Alpha Teknova Q2 2025 slides: Revenue up 7%, margins expand as losses narrow

Alpha Teknova Inc (NASDAQ:TKNO) reported second-quarter results showing improved financial performance across key metrics, according to the company’s Q2 2025 presentation released on August 7, 2025. The life sciences reagent manufacturer posted 7% revenue growth and significant margin expansion while continuing its progress toward profitability.

Quarterly Performance Highlights

Alpha Teknova reported total revenue of $10.3 million for Q2 2025, a 7% increase compared to $9.6 million in the same period last year. The growth was primarily driven by the company’s Clinical Solutions segment, which grew 32% year-over-year to $2.1 million. The larger Lab Essentials segment showed more modest growth of 2%, reaching $7.8 million.

As shown in the following revenue breakdown chart:

Gross margin improved substantially to 38.7% in Q2 2025, up from 29.2% in the same quarter last year, reflecting enhanced operational efficiency and a more favorable product mix. Operating expenses decreased to $7.4 million from $7.9 million in the prior-year period, demonstrating the company’s ongoing cost management efforts.

The combination of revenue growth, margin expansion, and cost control led to improved bottom-line results. Adjusted EBITDA loss narrowed to $0.8 million from $2.6 million in Q2 2024, while diluted loss per share improved to $0.07 from $0.13 a year ago, as illustrated in this income statement comparison:

The company’s cash position remained stable with $24.0 million in cash, cash equivalents, and short-term investments as of June 30, 2025. Free cash flow improved to -$2.3 million from -$3.0 million in the prior-year period, showing progress in the company’s path toward cash flow positivity.

Strategic Initiatives

Alpha Teknova’s presentation highlighted its three-phase growth strategy, transitioning from the "Establish" phase (1996-2016) through the "Invest" phase (2017-2023) to the current "Scale" phase (2024+). The company aims to achieve sustainable above-market revenue growth while becoming the partner of choice for emerging therapies, including cell and gene therapy and next-generation antibodies.

The strategic evolution is visualized in this timeline:

A key element of Teknova’s strategy is migrating customers from catalog-only purchases to higher-value custom and GMP (Good Manufacturing Practice) reagents. The presentation revealed that GMP customers spend 44 times more annually than catalog-only customers, while custom customers spend 22 times more.

This customer migration strategy has shown significant success, with 58% of 2024 revenue coming from custom and/or clinical accounts, and 27% from Cell and Gene Therapy customers, as illustrated in the following chart:

The company’s 2024 revenue breakdown shows that catalog products represented approximately 60% of revenue, custom products 35%, and other revenue streams 5%. Within the custom segment, biopharma customers accounted for 70% of custom revenue and grew more than 40% in 2024.

Financial Trends

Teknova’s presentation included a multi-quarter view of key financial metrics, showing consistent improvement in operating expenses and adjusted EBITDA since 2023. Capital expenditures have decreased significantly from their peak in early 2023, while free cash flow has generally improved over the period.

The following chart illustrates these financial trends over the past ten quarters:

The company has also shown positive trends in customer metrics, with the number of Clinical Solutions customers growing from 34 in 2023 to 48 in 2024, though the average revenue per Clinical Solutions customer decreased from $195,000 to $160,000 during the same period.

Forward-Looking Statements

For the full year 2025, Alpha Teknova maintained its revenue guidance of $39-42 million, representing 7% year-over-year growth at the midpoint. The company is targeting free cash outflow of less than $12 million for the year and estimates it will achieve Adjusted EBITDA break-even when it reaches an annualized revenue range of $50-55 million.

As shown in the outlook slide:

This guidance aligns with the company’s Q1 2025 outlook, suggesting stable business conditions and confidence in its growth trajectory. The projected 7% revenue growth represents a continuation of the momentum seen in Q2 2025.

Market Context

Alpha Teknova’s stock closed at $4.34 on August 7, 2025, down slightly by 0.23% for the day. The stock has traded between $3.45 and $10.37 over the past 52 weeks, according to market data.

The Q2 results follow a strong Q1 2025 performance where the company beat EPS expectations with a loss of $0.09 per share versus the forecast of -$0.11. The continued improvement in Q2 suggests the company is making steady progress toward its financial goals.

The company’s focus on the high-growth cell and gene therapy market appears to be paying off, with the Clinical Solutions segment showing robust 32% growth in Q2. This represents a significant turnaround from Q1 2025, when this segment reportedly faced challenges with a 32% revenue decline.

The detailed reconciliation of non-GAAP measures provided in the presentation offers transparency into the company’s financial reporting:

As Alpha Teknova continues its transition to the "Scale" phase of its growth strategy, investors will likely focus on the company’s progress toward Adjusted EBITDA break-even and its ability to maintain revenue growth while improving margins and cash flow.

Full presentation:

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