Cytek Biosciences, Inc. Q2 FY2025 earnings call

Quarterly Performance

• Second quarter revenue was $45.6M, down 2.2% y-o-y. Recurring revenue from service and reagent grew 18% y-o-y. FSP unit volume increased 3%, led by Aurora Analyzers with 10% growth in the U.S.

Geographic Performance

• U.S. revenue up 7% y-o-y driven by service and reagent; EMEA down 11% due to lower instrument sales; APAC down 12% in Q2 but up 9% in H1; Rest of World up single digits y-o-y.

Strategic Pillars

• Expanded global instrument installed base to 3,295 units. Launched Cytek Aurora Evo system with enhanced capabilities. Cytek Cloud users reached over 20,500, a 27% increase since the start of 2025. Reagent revenue achieved an 18% y-o-y increase, and service revenue grew 18% y-o-y in Q2.

Second quarter 2025 revenue was $45.6 million, down 2.2% compared to Q2 2024. Product revenue decreased 9% due to EMEA decline, while U.S. product revenue increased 2%. Service revenue grew 18% globally. Recurring revenue (service and reagent) reached 32% of trailing 12-month sales, growing 16% year-over-year. FSP unit volume grew 3%, led by Aurora Analyzers with 10% year-over-year growth in the U.S. For the first half of 2025, total revenue was down 5% compared to the prior year's first half, with APAC up 9% and Rest of World up 14%, offsetting declines in EMEA and the U.S.

Full year 2025 revenue guidance is narrowed to $196 million to $205 million, representing overall growth of minus 2% to plus 2% over full year 2024 assuming no change from current currency exchange rates. This reflects the company's assessment of market conditions and the first half results.

Risks

• Uncertainties in capital equipment spending due to policy issues affecting various markets.
• Potential impact of interest rates and NIH funding on market conditions, which could influence capital spending trends and U.S. academic/government sector performance.
• Variability in geographic revenue performance across regions like EMEA, APAC, etc.

Q: Discuss the flow cytometry market performance and competitive landscape.

A: Wenbin Jiang stated the overall flow cytometry market is reducing due to funding challenges, but Cytek's core business continues to grow with increasing FSP instrument unit volumes.

Q: How comfortable are you with the second half guidance and market improvement expectations?

A: Bill McCombe mentioned recurring revenue businesses (service and reagent) are growing strongly and expected to continue, while the instrument business is back-end weighted with a quarterly pattern similar to last year, expecting stronger second half performance.

Q: Are you open to M&A and what adjacencies are of interest?

A: William D. McCombe said Cytek is open to M&A and would look for opportunities with high synergy potential, either in existing markets or adjacencies. Wenbin Jiang emphasized organic growth in reagents and service as well.

Q: Talk about gross margins and tariff headwinds.

A: Bill McCombe explained margin improvement expected due to instrument revenue seasonality (third and fourth quarters typically stronger) and removal of onetime factors like overhead capitalization charges. Tariff headwinds were discussed but no specific update on current status beyond noting previous ranges.

Q: Contribution of Aurora Evo and Muse Micro to revenue and margins.

A: William D. McCombe said Aurora Evo is a larger contributor with high ASP, supportive of margins, while Muse Micro has a smaller impact on margins as it's a lower-priced product.

Q: Growth of reagent service and ex U.S./EMEA capital sales.

A: William D. McCombe noted service revenue growth is tied to installed base growth (predictable with 1-year lag), and reagent growth is due to existing customer relationships, improved execution, and broader product range, with drivers expected to continue.