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Ginkgo Bioworks Q1 Revenues Drop 52 Percent as COVID-19 Testing Winds Down

NEW YORK – Ginkgo Bioworks reported after the close of the market on Wednesday that its first quarter 2023 revenues dropped 52 percent year over year, due to an expected ramp-down in K-12 COVID-19 testing, part of the company’s biosecurity business unit.

In the three months ended March 31, Boston-based Ginkgo booked $80.7 million in revenues, compared to $168.4 million in the same period a year ago, beating the consensus Wall Street estimate of $71.7 million.

Revenues from the company’s cell engineering business were $34.1 million, up 62 percent from $21.5 million in Q1 2022. Biosecurity service revenues were $34.9 million, down 74 percent from $133.0 million a year ago. Meanwhile, biosecurity product revenues were $11.7 million, a 16 percent year-over-year decrease from $13.9 million in 2022.

Besides providing COVID-19 testing for schools, congregate settings, and at ports of entry, Ginkgo’s biosecurity and public health unit, Concentric, continues to be active in additional areas, including conflict zones, agricultural settings, and healthcare facilities, the company said.

Ginkgo Bioworks' net loss for the quarter totaled $205.0 million, or $.11 per share, compared to a net loss of $592.6 million, or $.37 per share, in Q1 2022. It missed the consensus Wall Street estimate of a per-share loss of $.09. The number of weighted average shares of common stock Ginkgo used to calculate Q1 net loss per share was approximately 1.91 billion, compared to approximately 1.61 billion in Q1 2022.

The company reported $162.6 million in R&D expenses for the quarter, roughly half of the $323.6 million a year ago. SG&A expenses were $111.4 million, down 74 percent from $434.8 million in the prior-year quarter.

Ginkgo ended Q1 with $1.21 billion in cash and cash equivalents, which the company said puts it "in a strong financial position to pursue its strategic objectives."

The company reiterated its 2023 revenue guidance of at least $275.0 million, including at least $175.0 million from cell engineering and at least $100.0 million from the biosecurity business.

Ginkgo acknowledged that biosecurity "remains an uncertain business" and said it anticipates a shift in its revenue mix toward emerging product lines that are "expected to be more recurring in nature," such as federal and international partnerships to support pathogen monitoring and biosecurity infrastructure development.

"There is no doubt that we are going to be living in a challenging market environment for a while, but Ginkgo was built for these moments — we have worked hard to give ourselves a margin of safety so that we can relentlessly focus on our mission to make biology easier to engineer," Ginkgo Cofounder and CEO Jason Kelly said in a statement.

In early Thursday morning trading on the Nasdaq, Ginkgo's shares were up 2 percent to $1.37. 

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