Codexis(US:CDXS)2025-08-13 21:30Financial Data and Key Metrics Changes - Total revenue for Q2 2025 was $15.3 million, up from $8 million in Q2 2024, primarily due to variability in Pharma Biocatalysis customers' manufacturing schedules and clinical trial progression [14][15] - Product gross margin increased to 72% in Q2 2025 from 45% in Q2 2024, attributed to shifts in sales to more profitable products [15][17] - The net loss for Q2 2025 was $13.3 million, compared to $22.8 million in Q2 2024, indicating improved financial performance [17] Business Line Data and Key Metrics Changes - The Pharma Biocatalysis business saw increased orders for enzymes supporting late-phase and commercialized APIs, contributing to strong Q2 revenue [6][14] - The Ecosynthesis platform is experiencing strong customer engagement, with over 30 ongoing customer engagements, indicating growing demand [5][21] Market Data and Key Metrics Changes - The demand for the Ecosynthesis platform is expected to exceed supply, prompting the company to explore options to expand capacity [5][12] - The ligation process is becoming the new standard in siRNA manufacturing, with the company focusing on acquiring new ligase customers [9][10] Company Strategy and Development Direction - The company aims to achieve cash flow breakeven by 2026 while exploring ways to maximize stockholder value through the Ecosynthesis platform [4][5] - A strategy is in place to secure early-phase products on the ECO platform, which could lead to significant returns as these products mature into commercial drugs [5][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the trajectory towards profitability and highlighted the importance of managing expenses while capitalizing on the strong cash position [17] - The company anticipates continued revenue lumpiness in the near term due to the unpredictability of the heritage business, but expects growth from the Ecosynthesis platform in the coming years [15][30] Other Important Information - The company ended the quarter with $66.3 million in cash and equivalents, sufficient to fund operations through 2027 [18] - Management is focused on establishing a GMP facility to improve the scale-up process and service small to medium-sized drug innovators [12][34] Q&A Session Summary Question: Can you provide an update on the pipeline and customer discussions? - The company has over 30 discussions ongoing, potentially growing into the 40s, with a mix of CDMOs and biopharma companies [21][22] Question: What is the status of process development projects in the Eco Innovation Lab? - The company is excited about recruiting early-phase projects and is considering setting up a second Eco Lab to increase capacity [27][28] Question: How does the company plan to expand bandwidth for the ECO platform? - The focus is on filling existing capacity and exploring partnerships while ensuring a credible path to GMP material [33][35] Question: What is the company's IP position around Ecosynthesis? - The company has a strong IP portfolio and emphasizes the importance of trade secrets and know-how in maintaining a competitive edge [37][38] Question: How should investors think about revenue collection pace? - The company aims to lock in a large number of early-stage projects, which could lead to significant future revenues as these assets mature [42][46] Question: What are the options for funding scaling to GMP? - The company is not considering selling its biocatalysis business, as it is profitable and reduces cash needs, while also planning incremental scaling [68][69]