HBIO — Harvard Bioscience, Inc.

Summary of Harvard Biosciences, Inc. Q1 2026 Earnings Call

1. Key Financial Results and Metrics:

• Revenue: $20.8 million, in line with guidance ($20 million to $22 million) but down from $21.8 million in Q1 2025.
• Adjusted Gross Margin: 59%, up 300 basis points year-over-year, attributed to operational efficiencies and higher-margin new product innovations (NPI).
• Adjusted EBITDA: $0.8 million, flat year-over-year, slightly below expectations due to increased sales and marketing investments.
• Operating Loss: $1.2 million, significantly improved from a loss of $49.7 million in the previous year (which included a $48 million goodwill impairment).
• GAAP EPS: Negative $0.77, improved from negative $11.42 a year ago; adjusted EPS was negative $0.33 compared to negative $1.25 last year.
• Cash Used in Operations: $0.7 million, down from $3 million in Q1 2025, primarily due to increased inventory.

2. Strategic Updates and Business Highlights:

• Continued transformation into a supplier of translational science products, with a focus on new product innovations like Mesh MEA, BTX Electroporation, and SoHo Telemetry.
• Sales to pharma and biotech customers grew over 20% year-over-year, driven by the adoption of new methodologies.
• The Made in China initiative launched to enhance local manufacturing and sales, starting with BTX products.
• Project Viking, aimed at consolidating manufacturing, is on track to generate $3 million in savings by 2027.
• Strengthened leadership team with the addition of Dave Panzarella as SVP of Commercial.

3. Forward Guidance and Outlook:

• Q2 2026 Guidance: Revenue expected between $20.5 million and $22.5 million, with adjusted gross margin between 57% and 59% and adjusted EBITDA between $1 million and $2 million.
• Full Year 2026 Guidance: Revenue growth of 2% to 4%, gross margin of 58% to 60%, and adjusted EBITDA growth of 6% to 10%.
• Anticipated growth in NPI products and increased spending from academic institutions following the approval of the NIH budget.

4. Bad News, Challenges, or Points of Concern:

• Year-over-year revenue decline primarily due to lower sales from academic institutions in the Americas and distributors in APAC.
• Operating cash flow was negative due to increased inventory and one-time administrative costs related to corporate actions.
• The Americas revenue decreased by 9% year-over-year, indicating challenges in the academic sector.
• Potential risks include reliance on the timely spending of academic budgets and the overall economic environment affecting research funding.

5. Notable Q&A Insights:

• NPI products (Mesh MEA, SoHo, BTX) currently account for 15% to 20% of total revenue and are expected to grow double digits.
• Increased activity in bidding from academic institutions is anticipated due to the recent approval of the NIH budget.
• In Asia, a mix of new and restarted projects is driving growth, with expectations for flat to positive growth in the region.
• The company is optimistic about sustaining gross margins above 60% due to the higher margin nature of new products and increased recurring revenue.

Overall, Harvard Biosciences is navigating a transitional phase with a focus on innovation and strategic initiatives, despite facing some revenue challenges in specific markets. The outlook remains cautiously optimistic with plans for growth and operational improvements.