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    TKNO
    Earnings call· Jun 2026(Q2 FY26)

    Alpha Teknova Q2 FY26 earnings call TKNO

    Aug 5, 2026 Source

    Executive summary

    Alpha Teknova Q2 FY26 — Record Revenue and Raised Full-Year Outlook

    Alpha Teknova delivered a record-breaking second quarter, achieving its highest-ever quarterly revenue with broad-based growth across most target markets. The company raised its full-year revenue guidance, reflecting confidence in its commercial investments and the underlying market recovery, despite continued softness in the cell and gene therapy segment. Strategic initiatives like the Build-Tek AI configurator are expected to enhance customer engagement and custom product adoption.

    Highlights

    5

    • Total revenue grew 18% year-over-year to over $12 million, the highest quarterly revenue in company history.

    • Free cash outflow significantly reduced to $0.6 million in Q2 FY26, compared to $2.3 million in Q2 FY25.

    • Lab Essentials revenue increased 18% to $9.2 million, driven by higher average revenue per customer.

    • Clinical Solutions revenue increased 18% to $2.4 million, driven by an increased number of customers.

    • Gross margin improved to 40.1% in Q2 FY26, up from 38.7% in Q2 FY25.

    Concerns

    3

    • Cell and gene therapy-related accounts were down in Q2 FY26 due to order timing and muted demand.

    • Biopharma revenue has been muted year-to-date due to softness in cell and gene therapy orders.

    • Operating expenses increased to $7.8 million in Q2 FY26, primarily due to investments in sales and marketing capabilities.

    Guidance & targets

    7
    CategoryTargetConfidence
    Full-year 2026 Total Revenue
    $45 million to $47 million
    high materiality
    High
    Full-year 2027 Total Revenue
    low $50 million
    high materiality
    Medium
    Full-year 2026 Gross Margin
    mid- to upper 30s percentage range
    medium materiality
    High
    Quarterly Operating Expenses
    at least $8 million per quarter
    medium materiality
    High
    Adjusted EBITDA Positive
    before the end of 2027
    high materiality
    Medium
    Annualized Revenue for Adjusted EBITDA Positive
    $52 million to $57 million
    medium materiality
    High
    Full-year 2026 Free Cash Outflow
    less than $8 million
    medium materiality
    High

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    Lab Essentials
    Revenue growth was attributable to higher average revenue per customer and, to a slightly lesser extent, an increased number of customers. The custom side grew significantly more than the catalog business.
    Q2 FY25 Revenue: $7.8 millionGrowth drivers: higher average revenue per customer, increased number of customers
    		$9.2 million18%——
    Clinical Solutions
    The increase was attributable to an increased number of customers, partially offset by lower average revenue per customer due to the addition of newer GMP catalog customers. Revenue per customer is expected to increase as customers ramp up clinical purchase volumes and move to commercialization. This category can experience quarter-to-quarter lumpiness due to larger average order sizes.
    Q2 FY25 Revenue: $2.1 millionGrowth drivers: increased number of customers, partially offset by lower average revenue per customer
    		$2.4 million18%——

    Operational metrics

    13
    Gross margin
    40.1%up from 38.7% in Q2 FY25
    Q2 FY26

    The increase was primarily driven by higher revenue, partially offset by higher fixed cost absorption into cost of goods sold from faster finished goods inventory turns. Q2 FY25 included unusually favorable manufacturing efficiencies, making for a difficult comparison.

    Operating expenses
    $7.8 millioncompared to $7.4 million in Q2 FY25
    Q2 FY26

    The increase was primarily driven by investments in our sales and marketing capabilities, resulting in higher headcount and increased marketing expenses, partially offset by lower general and administrative expenses attributable to lower stock-based compensation expense.

    Adjusted EBITDA
    -$0.7 millioncompared to -$0.8 million for Q2 FY25
    Q2 FY26

    Non-GAAP measure.

    Capital expenditures
    $0.1 millioncompared to $0.2 million in Q2 FY25
    Q2 FY26

    Lower capital expenditures year-over-year.

    Free cash outflow
    -$0.6 millioncompared to -$2.3 million for Q2 FY25
    Q2 FY26

    Non-GAAP measure, defined as cash used in operating activities less purchases of property, plant and equipment. Significant reduction compared to prior year.

    Cash, cash equivalents and short-term investments
    $17.4 million
    as of June 30, 2026

    Balance sheet item.

    Total borrowings
    $13.2 million
    as of June 30, 2026

    Balance sheet item.

    Catalog products revenue growth
    low double digitsYoY
    Q2 FY26

    Catalog business represents approximately 60% of total business.

    Total associates
    156compared to 171 a year earlier
    end of Q2 FY26

    Headcount reduction year-over-year despite investments in sales and marketing.

    Marginal cash rate for additional revenue
    approximately 70%
    ongoing

    Each additional dollar of revenue drops through at this rate, with some quarter-to-quarter variability due to GAAP accounting.

    Revenue capacity
    $200 million
    current

    The company has significant room for growth within existing facilities, able to add multiple shifts and work weekends before needing new capital expenditure for expansion.

    H1 2026 Revenue
    $23 million plus
    H1 2026

    Used as a baseline for mirroring H2 2026 revenue expectations in guidance.

    H2 2026 Revenue Expectation
    $23 million
    H2 2026

    Expected to mirror H1 2026 revenue, with Q3 stronger than Q4 due to seasonal lightness in Q4.

    Industry KPIs

    3
    MetricValueDetails
    Revenue EPS guidanceFY26: $45M-$47M; FY27: low $50MUSD
    Diagnostics testing demandStrong
    Segment organic revenue growth18%%

    Product announcements

    1
    ProductTypeDetails
    Build-Teklaunch

    Risks & headwinds

    2
    Muted demand in Cell and Gene Therapy (CGT) segmentQ2 FY26, year-to-date 2026

    down in Q2 FY26; biopharma revenue muted year-to-date

    Mitigation: Company expects biotech funding increase to positively impact revenue with a 4-quarter lag, and commercial investments to translate to revenue by early 2027.

    Seasonally light Q4 revenueQ4 FY26

    Q4 is seasonally light for us typically because of the fewer business days in that year

    Mitigation: Factored into the full-year guidance, with Q3 expected to be stronger than Q4.

    What to watch in Q3 FY26

    4

    Biotech funding impact on revenue

    end of 2026 or early 2027
    CurrentNot yet seen in revenue, 4-quarter lag expected
    TargetPositive revenue impact from additional funding

    Why it matters

    Biotech funding has increased for three quarters, and its translation to Teknova's revenue is a key indicator of market recovery and future growth.

    Given that we have historically seen an approximately four-quarter lag from funding changes to revenue recognition, we believe there may be a positive revenue impact from this additional funding at the end of this year or in early 2027.

    Q&A highlights

    5

    What is the visibility on the order funnel for Q3/Q4, especially in biopharma/CDMO, and is the biotech funding impact coming earlier than the typical 4-quarter lag?

    The funnel is strong, but current growth is not yet driven by biotech funding. Cell and gene therapy remains muted, though one Q2 order pushed to Q3 has no risk of further delay. The back half guidance does not factor in biotech funding flow-through.

    “Our funnel looks strong. It is not due to what we believe the biotech funding flowing through yet, right? So we have not yet seen that happen.”

    asked by Brendan Smith · answered by Stephen Gunstream

    2 min read5 chapters

    Detailed Narrative

    01

    Broad-Based Revenue Growth and Market Strength

    Teknova achieved its highest quarterly revenue in company history, exceeding $12 million in Q2 FY26, representing 18% year-over-year growth. This growth was broad-based, with no single customer dominating, and sales increased across all major target segments except cell and gene therapy. The company noted particular strength in supporting customers in the liquid biopsy market and driving catalog sales through improved distributor engagement.

    02

    Future Growth Tailwinds and Biotech Funding

    The company anticipates several tailwinds for 2027, including over 70 therapies/diagnostics using its products in clinical trials, with one expected commercialization by year-end 2027. This commercialization could increase customer purchases approximately tenfold. An increase in total biotech funding over the past three quarters is also expected to positively impact revenue by late 2026 or early 2027, following a typical four-quarter lag.

    03

    Commercial Investments Yielding Results

    Investments made in the commercial organization since January 2026, including new lead generation resources and additions to the field sales team, are producing results ahead of plan. These efforts are enabling access to high-profile accounts and creating new opportunities, which are expected to translate into revenue by early 2027. The company will evaluate further commercial investments in late Q3/early Q4.

    04

    Launch of Build-Tek AI Configurator

    Teknova officially launched Build-Tek, an AI-powered custom order configurator, which streamlines the design and quoting process for complex custom products. Trained on 30 years of manufacturing data, Build-Tek allows customers to create specifications in minutes, significantly reducing the weeks-long back-and-forth process. This tool is expected to increase brand strength and attract more customers to custom products, rather than being a direct revenue generator.

    05

    Operational Efficiency and Capacity

    The company continues to focus on operational efficiency, with gross margin improving to 40.1% in Q2 FY26. Teknova currently operates its facilities at 4-5 days on one shift, indicating significant remaining capacity, estimated at up to $200 million in revenue, before requiring major capital expenditures for expansion. Current manufacturing projects focus on driving efficiency and new capabilities.

    AI-generated summary of the company’s earnings call. Not investment advice.