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Twist Biosciences (TWST) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Mar 2026 (Q2 FY26)· Health Care· May 4, 2026

Source: earnings call transcript

Executive summary

Twist Biosciences Q2 FY26 — Strong Revenue Growth Driven by AI-Enabled Discovery and NGS Reacceleration

Twist Biosciences delivered robust Q2 FY26 results, extending its track record of sequential revenue growth, primarily fueled by strong demand in AI-enabled drug discovery within DNA Synthesis and Protein Solutions, alongside reaccelerated growth in NGS applications. The company continues to expand gross margins and remains on course for adjusted EBITDA breakeven by Q4 FY26, driven by strategic investments in capacity and digital infrastructure, and disciplined cost management.

Highlights

5

  • Total revenue grew to $110.7 million, up over 19% year-over-year, marking the 13th consecutive quarter of sequential growth.

  • DNA Synthesis and Protein Solutions revenue increased by 28% year-over-year to $53.3 million, powered by AI-enabled drug discovery.

  • NGS applications revenue reaccelerated, growing 12% year-over-year to $57.4 million and 9% sequentially.

  • Gross margin expanded to 51.6%, an improvement of approximately 200 basis points year-over-year.

  • Adjusted EBITDA loss narrowed to $13.3 million, an improvement of $1.5 million year-over-year, remaining on track for breakeven in Q4 FY26.

Concerns

3

  • Global Supply Partner revenue decreased to $11.4 million from $12 million in the prior year, primarily due to order timing.

  • Industry and Applied revenue decreased to $5.8 million from $7 million in the prior year.

  • Academic and Government end market is suffering from funding pressures, though Twist is gaining market share.

Guidance & targets

CategoryTargetConfidence
Total Revenue
$442 million to $447 million
high materiality
High
Total Revenue
$114 million to $115 million
medium materiality
High
Adjusted EBITDA
breakeven
high materiality
High
NGS Applications Growth
return to 20%
medium materiality
High

Segment performance

SegmentRevenueYoYQoQMargin
DNA Synthesis and Protein Solutions
Powered by continued strength in AI-enabled drug discovery.
$53.3 million28%——
NGS Applications
Grew from $51.1 million in Q2 FY25. Driven by growth in top accounts, with particular offense in oncology diagnostics. Top 10 customers accounted for approximately 39% of NGS revenue. Served 627 NGS applications customers in the quarter, with 174 having adopted products.
$57.4 million12%9%—
Americas
Increased from $55.2 million in Q2 FY25.
$64.3 million17%——
EMEA
Increased from $30.6 million in Q2 FY25.
$37.3 million22%——
APAC
Increased from $7 million in Q2 FY25. Accounted for 8% of total revenue. China continues to be approximately 1% of total revenue.
$9.1 million30%——
Therapeutics
Increased from $26.3 million in Q2 FY25. Reflects increased uptake of products by large pharma and biotech customers in their efforts on therapeutic discovery, including AI-enabled discovery.
$40.8 million55%——
Diagnostics
Increased from $35 million in Q2 FY25. Based on strong growth from top accounts.
$40 million14%13%—
Industry and Applied
Decreased from $7 million in Q2 FY25.
$5.8 million-17.1%——
Academic Research and Government
Increased from $12.5 million in Q2 FY25. Driven by strength in U.S. accounts, despite suffering from funding pressures.
$12.8 million3%5%—
Global Supply Partner
Decreased from $12 million in Q2 FY25, primarily due to order timing.
$11.4 million-5%——

TWST operating KPIs by quarter

TWST operating KPIs stated on its earnings calls, by fiscal quarter
KPIThis call Mar 2026 Q2 FY26 Jun 2026 Q3 FY26Change vs prior quarter
NGS applications customers
627 We serve 627 NGS applications customers in the quarter with 174 having adopted our products. Source: earnings call transcript
657 We served 657 NGS applications customers in the quarter with 182 having adopted our products. Source: earnings call transcript
+4.8%
Adopted NGS applications customers
174 We serve 627 NGS applications customers in the quarter with 174 having adopted our products. Source: earnings call transcript
182 We served 657 NGS applications customers in the quarter with 182 having adopted our products. Source: earnings call transcript
+4.6%

Operating figures the company stated on at least two of the calls shown, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Deals & partnerships

Amazon Web Services (AWS) Wet lab partner for Amazon BioDiscovery, an AI-powered drug discovery application. Several months

Twist has been working with the AWS team for several months, providing wet lab services for Amazon BioDiscovery's scientific launch partners, including Memorial Sloan Kettering Cancer Center and the GRAIL Lab adjuncts of Kim Senior City.

Risks & headwinds

Academic and Government funding pressures Current

Market is basically shrinking right now.

Mitigation:Taking market share through product offerings and premium discounts (e.g., express genes) that resonate with customers facing funding constraints.

What to watch in Q3 FY26

Adjusted EBITDA breakeven

Q4 FY26
Current -$13.3 million (Q2 FY26 loss)
Target Breakeven

Why it matters

This is a key profitability milestone for the company, indicating operational efficiency and financial health.

We remain firmly on track to achieve adjusted EBITDA breakeven in the fourth quarter of fiscal 2026.

Find out whether TWST delivers this. Inve re-checks your case every morning.

Q&A highlights

How did AI-driven workflows perform relative to expectations, and how does the segment outlook contribute to updated fiscal guidance?

Emily Leproust highlighted strong performance in DNA Synthesis and Protein Solutions (SPS), growing 28% YoY, with therapeutics cracking $40M. AI-driven discovery significantly increases the number of sequences customers want, leading to upsell opportunities. The broad menu and NPI engine are driving growth, with AI being a major contributor.

“Obviously, we're very excited with the performance of the SPS growing 28% year-over-year. And for the therapics category, we cracked the $40 million for the quarter... AI-driven drug discovery has been a big help in that area. It just increases the number of sequences that people want to look at.”

asked by Steven Etoch · answered by Emily Leproust

2 min read 5 chapters

Detailed narrative

AI-Enabled Drug Discovery Momentum

Twist is seeing robust growth in AI-enabled drug discovery, with Amazon Web Services announcing Twist as a wet lab partner for Amazon BioDiscovery. This collaboration involves providing lab services for scientific launch partners like Memorial Sloan Kettering Cancer Center, focusing on accelerating antibody candidate design and optimization. The company noted that AI-driven discovery complements traditional discovery and increases the number of sequences customers want to analyze, leading to upselling opportunities for data and cell characterization. Emily Leproust noted that many drug discovery companies 'tap out at $50 million a year', highlighting Twist's significant progress in this area.

DNA Synthesis Platform Advantage

The core technology, a semiconductor-based DNA platform, provides structural advantages in cost, scale, and speed, enabling efficient new product introduction and continuous portfolio expansion. This platform allows for cost-effective synthesis of hundreds of thousands of unique sequences in parallel, supporting diverse customer workflows from pooled libraries to fully managed programs. The company highlighted its ability to run large, complex sequence sets in parallel, accelerating every stage of the workflow and delivering high-quality data.

NGS Applications Strength

NGS growth reaccelerated in Q2, driven by oncology diagnostics, particularly in minimal residual disease (MRD) testing. Twist's target enrichment and library preparation solutions are critical for high-sensitivity applications, ensuring uniform coverage and reproducibility. The company's ability to combine high-throughput DNA synthesis with precision panel design and manufacturing at scale enables rapid delivery of customized panels, supporting recurring revenue as these applications extend.

Manufacturing Acceptance Rate Improvements

Twist announced plans to increase its acceptance rate for clonal genes to approximately 99.5% and all DNA products to 99.9%. This improvement aims to unlock incremental market share gains by addressing manufacturing challenges for complex sequences (e.g., repeat regions, extreme GC content) and ensuring customers can rely on Twist as a single partner for their diverse needs. This continuous drive to improve sets Twist apart from competitors with narrower offerings.

Path to Profitability

The company is focused on achieving adjusted EBITDA breakeven in Q4 FY26 through continued revenue growth, gross margin expansion, and operating expense discipline. Recent actions include a reduction of 36 positions and other cost initiatives expected to contribute $6 million in sequential OpEx improvement in Q4 FY26. These are considered revenue-generating investments with a clear line of sight to return.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.