Skip to main content
Premium Trial:

Request an Annual Quote

Twist Bioscience Fiscal Q1 Revenues Grow 64 Percent; JP Morgan Downgrades to Underweight

NEW YORK – Twist Bioscience reported after the close of the market on Thursday that its first quarter revenues in fiscal year 2021 increased 64 percent year over year.

For the three months ended Dec. 31, 2020, Twist reported $28.2 million in revenues, up from $17.2 million during the same quarter a year ago and beating internal guidance and the average analyst estimate of $25.4 million.

Next-generation sequencing revenues, including SNP microarray conversions and liquid biopsy panels, were $15.6 million, up from $7 million during the year-ago quarter, outpacing synthetic biology revenues for the first time.

Synbio revenues, which include genes, libraries, and oligo pools, totaled $11.5 million in Q1, up from $10.1 million a year ago, with $8.1 million from genes, which included $1.4 million from Ginkgo Bioworks. The company shipped approximately 84,000 genes during the quarter.

Biopharma revenues were $1 million, driven by upfront services for antibody discovery projects. "We reported a strong quarter both for orders and revenue, building a solid foundation for fiscal 2021," Twist CEO and Cofounder Emily Leproust, said in a statement. "We see early evidence that our investment in synbio products for our pharmaceutical and biotech customers is beginning to gain traction, and for our NGS tools business, our liquid biopsy customers continue to drive revenue growth."

On a conference call with investors following the release of results, Leproust noted that the quarter's revenues included a single $4.5 million order from a liquid biopsy customer, which she declined to name.

Twist saw growth in all geographic regions, CFO Jim Thorburn said during the call, with $17.3 million coming from the Americas, $9.1 million from EMEA, and $1.8 million from APAC.

The largest business segment was healthcare, with $15.9 million in revenues, followed by industrial biotech, with $7.1 million in revenues; academic revenues, $4.9 million; and agriculture, $2 million.

In total, the company shipped products to about 1,500 customers during the quarter, compared to about 1,000 during the year-ago quarter.

Twist also completed an offering of approximately 3.1 million shares of its common stock in Q1, raising about $324 million in net proceeds.

JP Morgan downgraded shares of Twist to an Underweight rating.

"While we acknowledge that Twist is a clear leader in the attractive synthetic biology market, we now see the risk/reward profile as skewed to the downside versus the rest of our coverage, with performance highly contingent on sustained momentum in synbio (with and excluding Ginkgo contributions), the NGS ramp (continued progress with conversions), substantial advancements in biopharma drug discovery, and DNA data storage," analyst Tycho Peterson wrote in a research note. "With these factors in mind, we are downgrading our rating to Underweight, with no change to our December 2021 price target of $100."

For Q1, the company reported a net loss of $32.9 million, or $.72 per share, compared to $55.6 million, or $1.69 per share, in Q1 of FY2020, beating the average analyst estimate of a net loss of $.74 per share. Twist's year-ago quarter included a $22.5 million litigation settlement expense. The weighted average number of shares used to compute net loss per share was 46 million in Q1, compared to approximately 33 million a year ago.

Twist's Q1 R&D expenses rose 36 percent to $14.0 million from $10.3 million in Q1 of FY2020, offset by about $300,000 from Georgia Tech for DNA synthesis and $800,000 for a confidential project. SG&A expenses rose 9 percent to $28.8 million from $26.4 million a year ago, driven by investment in Twist's commercial organization.

As of Dec. 31, 2020, the company had $348.8 million in cash and cash equivalents, and $238.5 million in short-term investments.

Twist reiterated fiscal year 2021 guidance of total revenues of $100 million to $118 million, including Ginkgo Bioworks revenue in the range of $11 million to $12 million; synbio revenue, excluding Ginkgo, in the range of $41 to $44 million; NGS revenue in the range of $54 million to $58 million; and biopharma revenue of approximately $4 million.

The firm now expects a net loss of $142 million to $147 million, compared to previous guidance for a net loss of $136 million to $141 million, reflecting increased investment in its commercial organization and R&D activities.

In after hours trading on the Nasdaq, Twist shares were down 14 percent at $170.00.