Ginkgo Bioworks Holdings, Inc. Q3 FY2025 earnings call

Management Statement and Operational Highlights

• Strategic Focus:
  • AI Impact: AI models will impact biotechnology by enabling reasoning models to control physical lab automation and training neural nets on biological data. Ginkgo is positioned to sell tools in these areas.
  • Research Solutions Wins: Had 2 big wins in the last quarter, including a $22 million BARDA award for monoclonal antibody manufacturing and extending a partnership with Bayer for fertilizer-producing microbes.
  • Frontier Autonomous Lab: Expanding the RAC setup in Boston with 45+ instruments, aiming for 100 RACs. The RAC system allows LEGO-like assembly of lab equipment, software-controlled, and demoable for customers.
• Cost and Cash Burn: Significant reduction in cash burn to $28 million in Q3 2025 from $114 million y-o-y, driven by restructuring efforts.

Segment Performance

• Cell Engineering: In the third quarter of 2025, Cell Engineering revenue was $29 million, down 61% compared to Q3 2024. Excluding noncash revenue from Motif FoodWorks, revenue was down 11% y-o-y. Supported 102 revenue-generating programs, a 5% decrease year-over-year. R&D expense decreased 8% to $51 million, G&A expense decreased 47% to $12 million. Segment operating loss was $37 million vs. $5 million in the comparable prior year period.
• Biosecurity: Generated $9 million in revenue in Q3 2025 with a segment gross margin of 19%. Segment operating loss improved 21% compared to the prior year comparable period.

Guidance

• Reaffirmed full-year 2025 revenue guidance of $167 million to $187 million, with Cell Engineering revenue $117 million to $137 million and Biosecurity revenue at least $40 million.
• Focus on core objectives in Q4 while navigating macroeconomic uncertainty.

Risks

• No specific risks detailed beyond general macro environment uncertainty mentioned in the guidance.

Question and Answer

• Q: Can you comment on the extent of Ginkgo's exposure to U.S. government business and how that has been impacted by the shutdown?

A: Shutdown hasn't had a big impact; grants/funding slow but Ginkgo has good exposure with government contracts like BARDA and ARPA-H awards.

• Q: How do you see the broader development or rollout path ahead for the RAC system over the next 18 months?

A: Scale manufacturing, reduce costs, drive adoption of general purpose autonomous labs. Internal milestone: 50+ scientists ordering simultaneously. External milestone: Large biopharma purchase of a large system.

• Q: Steve, you mentioned resetting the contract with Google. Can you provide more color?

A: Reset terms to reduce go-forward commitment by over $100 million and extend period by 2x, favorable for Ginkgo.

• Q: How does Ginkgo's experience inform viewpoint on AI designing experiments?

A: AI models can read literature and generate hypotheses, but limitation is access to lab tools. Ginkgo provides robotic infrastructure to enable models to conduct experiments.

• Q: How will AI plus robotics change R&D landscape?

A: Allows pursuing multiple hypotheses in parallel, reducing reliance on human time and lab space, compressing costs to consumables.