908 Devices Inc. Q3 FY2025 earnings call

• Revenue from continuing operations for the first nine months totaled $38.8 million, up 16% year over year. Recurring revenue represented 36% of total revenue, and U.S. State and local channel revenue for the first nine months was 47% of total revenues.
• Adjusted EBITDA loss for the third quarter was $1.8 million, an improvement of over $5 million year over year and a 53% decrease quarter over quarter, the lowest adjusted EBITDA loss in the company's public history.
• Strategic focus areas include increasing adoption of devices to address global threats, advancing next-gen analytical tools portfolio (launch of Viper handheld chemical analyzer), and strengthening financial position and accelerating profitability through facility consolidation and operational scale-up.
• Explorer device shipments were a record in Q3, with a 30% quarter over quarter increase in placements. Viper unit shipped to a government intelligence agency in Southeast Asia, and there was enthusiasm for Viper at the EMEA Channels Partner Summit.

Total revenue for the third quarter of 2025 was $14 million, down 4% year over year but up 8% sequentially. Handheld product and service revenue was $13.2 million, down 5% year over year, accounting for 35% of total revenue. OEM and funded partnership revenue was $800,000, up from $500,000 in the prior year period. Recurring revenue, consisting of consumables, accessories, and service revenue, was $4.8 million, 35% of total revenues, and up 10% year over year. FTIR devices accounted for 42% of revenue, driven by strong demand for the Explorer gas identification device.

• Revenue from continuing operations for 2025 is expected to be in the range of $54 million to $56 million, representing 13%-17% growth over 2024. Handheld product and service revenue is expected to grow 16%-20% year over year, OEM and funded partnerships to be ~$2.5 million.
• Adjusted gross margins are expected to be in the mid- to high 50s range for full-year 2025, with further expansion in 2026.
• Target to achieve adjusted EBITDA positivity in Q4 2025, supported by Q4 revenue projection, anticipated mix, and lower operating costs following portfolio divestiture and facility consolidation.

• Impact from the protracted U.S. Government shutdown on three areas: demand from state and local customers, international engagement and order flow (export licensing delays), and federal and defense orders (larger awards delayed). Approximately $4 million of Q4 revenue could be impacted by these delays.
• Uncertainty around timelines for government programs like AvCAD due to program changes and shutdown dynamics.

Q: Interest in Viper so far and launch ramp relative to earlier gen devices?

A: Viper had a first unit shipped to a government intelligence agency in Q3, with 35 units on deck for Q4 shipment. Viper is expected to be a rising contributor in 2026, complementary to earlier gen devices with no cannibalization impact.

Q: Next steps for Team Leader app and monetization?

A: Team Leader is an app connecting to FTR devices and soon mass spec devices, with fleet management features being developed. It is expected to contribute incrementally to recurring revenue as more features are added.