Cerus Corporation Q3 FY2025 earnings call

• Commercial execution was strong in Q3 2025 with double-digit product revenue growth across the INTERCEPT portfolio.
• In the U.S., INTERCEPT adoption in platelets continues to grow, with an estimated market penetration in the mid-60% vicinity and potential to reach north of 80%.
• IFC is gaining clinical traction, with an acceleration in kit sales to blood centers and a shift from direct sales to hospitals.
• In international markets, INTERCEPT is the standard of care in multiple European countries, and Cerus was selected by the German Red Cross Blood Service for the INITIATE study.
• Enrollment of the last patient in the U.S. Phase III RedeS trial was completed in October, with results expected in the second half of 2026.
• The regulatory review of INTERCEPT RBCs in Europe was delayed by at least 6 months.
• The INT200 LED-based illumination device's U.S. PMA submission is planned for mid-2026, and a new platelet clinical study is to be initiated.

For the third quarter of 2025, Cerus reported record product revenue of $52.7 million, a 15% year-over-year increase. For the first 9 months of 2025, product revenue increased 15% to $148.4 million compared to the first 9 months of 2024. Globally, platelet sales and IFC sales in the U.S. were key drivers of growth. EMEA product revenues in the third quarter increased 21% compared to the same period last year, with a 14% increase in constant currency. North American product revenues increased 11% compared to the prior year, led by the United States. IFC product revenue for the third quarter was $3.9 million, a 70% year-over-year increase, with volume demand increasing approximately 110%.

• Raised full year 2025 product revenue guidance range to $202 million to $204 million from the previous $200 million to $203 million.
• Full year 2025 IFC sales guidance adjusted to $16 million to $17 million from $16 million to $18 million due to the faster shift to kits.
• Achieved sixth consecutive quarter of positive non-GAAP adjusted EBITDA, with expectations to deliver full year positive adjusted EBITDA.

• Forward-looking statements involve risks and uncertainties that can cause actual events, performance, and results to differ materially, including factors like foreign exchange rates, tariff environment, etc.

Q: Congrats on the quarter. Starting on gross margin, which headwinds do you expect to ease versus persist in 2026 and what levers can be pulled to stabilize margins?

A: Some headwinds like FX rates and tariff environment are out of control. What can be controlled are growing the business, economies of scale, and product mix. The push for IFC to move from selling finished therapeutics to hospitals to a kit sale to blood centers to produce IFC for their own hospital accounts will help drive margin expansion.

Q: Just one more on IFC. Can you talk about the ability to meet growing demand over the next couple of quarters and supply chain/manufacturing to ensure consistent product availability?

A: We've seen strong improvement in production and supply capability. A fairly large blood center received their BLA. Blood centers express interest in producing IFC and those currently producing are seeking BLA to transport product across state lines, so supply shouldn't be a constraint for the foreseeable future.

Q: Just on IFC, what drove the decision to start shifting more towards the kit-based model?

A: The primary reasons are twofold. First, leverage existing sales channels of the blood center to amplify field sales personnel and engage with hospitals without associated SG&A expense. Second, leverage existing blood center and hospital contracts for market access, which reduces cycle time in getting contracts in place. There's also a gross margin benefit associated with selling kits through blood centers versus selling finished therapeutics directly to hospitals.

Q: On the OpEx side, you came in below modeling and a step down from Q2. Talk about what drove that and how sustainable it is going forward and into 2026?

A: In Q2, there were cumulative compensation costs that were an outsized impact. As for going forward, focus on the business model with a concentrated customer base and leveraging that for revenue growth from SG&A investments. R&D variability is driven by BARDA awards and the U.S. PMA for the LED illuminator. Expect them to be fairly consistent, and RedeS readout should see a slight tick down in R&D but nothing too significant.