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Twist delivered its 13th consecutive quarter of sequential revenue growth, outperforming the broader life sciences tools market through its proprietary semiconductor-based DNA platform.
The core technology provides a structural advantage in cost, scale, and speed, enabling a highly efficient new product introduction engine that translates customer demand into scalable offerings.
Growth in DNA Synthesis and Protein Solutions (up 28%) was powered by early investment in AI-enabled drug discovery, which has expanded from a few accounts to dozens of active customers.
Management attributes the 55% growth in the Therapeutics segment to the platform's ability to meet customers at any entry point, from pool libraries of 100,000 sequences to end-to-end characterization.
The NGS business reaccelerated, driven by increasing adoption in oncology diagnostics, specifically minimal residual disease (MRD) testing which requires high sensitivity and rapid panel customization.
Operational leverage is improving as volume increases on the silicon chip, supporting gross margins above 50% while maintaining strategic investments in commercial and digital infrastructure.
Management remains firmly on track to achieve adjusted EBITDA breakeven in the fourth quarter of fiscal 2026 through revenue momentum and expense discipline.
Fiscal 2026 revenue guidance was raised to $442 million to $447 million, reflecting confidence in the continued uptake of therapeutic discovery and a return to 20% growth in NGS by Q4.
The company expects a $6 million sequential improvement in operating expenses in Q4 fiscal 2026 following a reduction of 36 positions and other cost-saving initiatives.
Future margin gains are expected from continuous process improvements and the automation of back-end workflows for IgG and characterization projects.
Twist plans to expand its manufacturing capabilities to accept approximately 99.5% of clonal genes and 99.9% of all DNA products to unlock incremental market share.
Twist reached an agreement in principle to settle a securities class action for $17.1 million, with $7.2 million booked in Q2 and the remainder expected to be covered by insurance.
A new partnership with Amazon Web Services (AWS) positions Twist as the wet lab partner for Amazon BioDiscovery, validating its biologics and protein solutions capabilities.
The company licensed the Invenra body-byspecific platform in February to enable high-throughput discovery in the rapidly growing bispecifics modality.
Geographic growth was strongest in APAC (up 30%) and EMEA (up 22%), while China remains a minimal portion of total revenue at approximately 1%.
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AI discovery has significantly increased the volume of sequences customers want to analyze, allowing Twist to upsell from DNA pools to data and cell characterization.
The Therapeutics segment's $40.8 million revenue this quarter reflects a shift from model building to 'turning the crank' on active discovery programs across dozens of accounts.
While the academic market is shrinking due to funding pressures, Twist is gaining market share by offering premium discounts on express genes to provide better value and speed.
Management intends to maintain these promotions to help academic researchers remain competitive for grants while capturing volume from legacy competitors.
The slight sequential moderation in gross margin was a deliberate investment in capacity and people to support the 55% growth in Therapeutics.
Management expects a 75% to 80% average drop-through on incremental revenue to gross margin as they continue to automate the 'back-end' of the production process.
Twist is moving toward accepting nearly 100% of DNA requests to prevent losing entire orders when a single complex sequence in a set cannot be manufactured.
This initiative targets emerging needs in nucleic acid therapeutics and plant engineering where sequence complexity has historically been a barrier.
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