Cerus Corporation Q2 FY2025 earnings call

• Strong commercial and product development execution in Q2, with record quarterly sales and near doubling of IFC revenue quarter-over-quarter.
• Raised full year 2025 product revenue guidance due to increasing customer demand for IFC and growth across the INTERCEPT product offering.
• INT200 Illuminator launched, with positive feedback, approved in ~40 countries, and deployed in the field. It has CE Mark and approvals in France and Switzerland.
• Red blood cell program in Europe: regulatory review advancing, TÜV SÜD completed review of several modules, and expect CE Mark approval decision in second half of 2026 with expanded submission covering all patient indications.
• $7.2 million award from U.S. Defense Department for CRYO-FIRST study on early IFC in trauma patients.
• Q2 product gross profit was $29 million, up 17% year-over-year, with product gross margins at 55.2%.
• Fifth consecutive quarter of positive non-GAAP adjusted EBITDA, totaling $935,000 in Q2 2025.

For the second quarter of 2025, product revenue was $52.4 million, a 16% year-over-year increase. First half product revenue was $95.7 million, a 15% increase compared to the first half of 2024. IFC sales in Q2 were $5.6 million vs. $2 million in the prior year period. North American product revenues increased 17% year-over-year in Q2, and EMEA product revenues increased 21% year-over-year. Full year 2025 product revenue guidance is raised to $200 million to $203 million (previously $194 million to $200 million), with IFC sales expected to be in the range of $16 million to $18 million (previously $12 million to $15 million). Government contract revenue in Q2 2025 was $7.7 million vs. $5.4 million in the prior year period.

• Raised full year 2025 product revenue guidance to $200 million to $203 million from $194 million to $200 million.
• Full year 2025 IFC sales expected to be in range of $16 million to $18 million vs. previous $12 million to $15 million.
• Expect continued growth in back half of 2025, but Q3 may be tempered by summer holiday season and absence of deferred revenue recognized in Q2.
• Historically, Q4 has been robust.

• Forward-looking statements involve risks and uncertainties that could cause actual results to differ, detailed in press release, slide presentation, and Form 10-Q.
• Ongoing changes in Washington causing back-office administrative delays and timing issues with award modifications for government contracts.
• In China, NMPA requested additional pathogen inactivation and in vitro platelet quality data tailored to local processing requirements, leading to temporary withdrawal of current submission.
• In Germany, regulatory process ongoing regarding potential new requirements for pathogen reduction or bacterial testing for blood components, which could impact INTERCEPT platelet adoption over time.

Q: Could you touch on the expected cadence of revenue through the remainder of the year, comparing to 2024 precedent?

A: Expect continued growth in back half relative to first half. EMEA may flatten from Q2 to Q3 due to summer holidays. Deferred revenue recognized in Q2 won't be in back half, so growth tempered in Q3, and historically Q4 is robust.

Q: With the expanded CE Mark submission for red blood cells to cover all patient indications, how does this change the view of the TAM compared to initial chronic transfusion submission?

A: Initial submission was for chronic transfusion recipients, but now expanded to all patient populations receiving red cell transfusion. This opens up more opportunity with fewer restrictions on blood centers' operations post-CE Mark approval, though details on rollout post-approval are still TBD.

Q: Given the strong ramp in first half IFC and increased guidance, can you walk through key drivers in hitting the revised guide and quarterly cadence?

A: Had catch-up in first half from backlog and back orders ending 2024. Now fully through backlog. Increasing supply and demand, with new hospitals onboarding and existing customers increasing penetration. Comfortable supply position entering back half drives confidence in hitting revised guide.

Q: Can you parse out how much of the OpEx step-up reflects variable investment in growth versus one-time related spend and expense cadence in back half?

A: Increase in government contract activity underwritten by BARDA, FDA, and DoD contributes to R&D expense increase. Also, cost of living adjustments for employees due to inflationary environment are a factor. Expense cadence in back half expected to continue with focus on leveraging SG&A investments.