Earnings call transcript: Maravai Lifesciences Q2 2025 sees stock dip despite revenue growth

Maravai Lifesciences Holdings Inc. reported its second-quarter 2025 earnings, revealing a net loss per share of $0.08, slightly missing the forecast of a $0.07 loss. Revenue also fell short of expectations, coming in at $47.4 million against a forecast of $47.61 million. Following the release, the company’s stock dropped 6.36% in regular trading but saw a slight recovery of 3.64% in after-hours trading. According to InvestingPro analysis, the stock is currently fairly valued, with a Financial Health Score rated as ’FAIR’.

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Key Takeaways

• Maravai Lifesciences reported a Q2 2025 revenue of $47.4 million, down from $69.4 million in 2024.
• The company’s stock fell 6.36% during regular trading hours but gained 3.64% after hours.
• The Nucleic Acid Production segment generated $31.1 million, while Biologics Safety Testing brought in $16.3 million.
• Maravai is implementing a $50 million cost reduction plan to improve financial health.
• The company has withdrawn its previous financial guidance, targeting positive adjusted EBITDA by 2026.

Company Performance

Maravai Lifesciences faced a challenging quarter with a significant reduction in revenue compared to the previous year, dropping from $69.4 million in Q2 2024 to $47.4 million in Q2 2025. Despite the decline, the company reported a 5% increase in base revenue. The Nucleic Acid Production segment remained a strong contributor, generating $31.1 million, while the Biologics Safety Testing segment brought in $16.3 million. Maravai’s efforts to streamline operations through a $50 million cost reduction plan aim to enhance its financial position.

Financial Highlights

• Revenue: $47.4 million, down from $69.4 million in Q2 2024
• Earnings per share: -$0.08, compared to a forecast of -$0.07
• GAAP net loss: $69.8 million
• Adjusted EBITDA: -$10.4 million
• Cash position: $270 million
• Long-term debt: $297 million

Earnings vs. Forecast

Maravai’s earnings per share fell short of expectations, with an actual loss of $0.08 compared to the forecasted $0.07. This represents a surprise of 14.29%. Revenue also missed projections, coming in at $47.4 million against the forecast of $47.61 million, marking a surprise of -0.44%. The discrepancies highlight ongoing challenges in meeting market expectations.

Market Reaction

The company’s stock experienced a 6.36% decline during regular trading, closing at $2.06 from a previous close of $2.20. However, in after-hours trading, the stock rebounded slightly, increasing by 3.64% to $2.28. This movement reflects investor uncertainty amid mixed earnings results and the withdrawal of previous financial guidance. InvestingPro data shows the stock has declined 75.88% over the past year, with 10 analysts recently revising their earnings expectations downward for the upcoming period.

Outlook & Guidance

Maravai Lifesciences has withdrawn its previous financial guidance, focusing instead on achieving positive adjusted EBITDA and free cash flow by 2026. The company is also targeting growth in the e-commerce and research markets, with an emphasis on expanding capabilities in mRNA therapeutics. A potential high-volume CleanCap order is anticipated in early 2026, which could significantly impact future revenues. InvestingPro analysis indicates management has been actively buying back shares, though analysts anticipate sales decline in the current year.

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Executive Commentary

Raj Atsarpota, CFO, expressed confidence in the company’s strategic direction, stating, "We are laying the foundation to drive operational excellence and disciplined growth." CEO Bernd Brust echoed this sentiment, highlighting the company’s strengths: "We have great science and technology, and I’m optimistic that we are going to have a great future."

Risks and Challenges

• Market volatility could impact stock performance.
• The withdrawal of financial guidance may create uncertainty among investors.
• The restructuring process could face execution risks.
• Increased competition in the life sciences tools market.
• Potential regulatory changes affecting the biotechnology sector.

Q&A

During the earnings call, analysts inquired about Maravai’s restructuring rationale and the potential for growth in the China market. The company addressed concerns about the mRNA funding environment and highlighted opportunities for expanding its Contract Development and Manufacturing Organization (CDMO) business.

Full transcript - Maravai Lifesciences Holdings Inc (MRVI) Q2 2025:

Earnings Call Operator/Moderator: Good afternoon, everyone. Thanks for joining us on our second quarter twenty twenty five earnings call. The press release and slides accompanying today’s call are posted on our website and available at investors.maravi.com. During today’s call, management will make forward looking statements and refer to GAAP and non GAAP financial measures. It is possible that actual results could differ from management’s expectations.

We refer you to slide three for more detail on forward looking statements and our use of non GAAP financial measures. The press release provides reconciliations to the most directly comparable GAAP measures, and we also post reconciling schedules to the IR website. Please also refer to Maravai’s SEC filings for additional information on the risks and uncertainties that may impact our operating results, performance, and financial condition. Now I’ll turn the call over to our Chief Executive Officer, Bernd Brust.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: Good afternoon and thank you all for joining. I’m Bernd Brust and I’m very pleased to be hosting my first earnings call as Marvei’s CEO. I’d like to begin with my reasons for accepting the role as CEO and in this context frame for investors the incredible opportunities I see ahead for the company. Over the past thirty years, I’ve been a leader of many successful life sciences companies that have experienced both growth and transformation. My approach centers around alignment, strategic clarity with operational discipline to drive meaningful measurable results.

I’ve had the rare opportunity to work directly on a long list of breakthrough technologies in the life sciences sector, including in multiple CEO roles. Most recently, I was the executive chairman and prior to that the CEO of Antilia Scientific, a global provider of tools and solutions for diagnostic testing, sample preparation, biological monitoring and environmental analysis. I’ve known Miravi as a technology leader that delivers meaningful innovation to market. When I was approached about the CEO role, I took a close look and what stood out to me was how rare it is to find a company in the life sciences tool space with this combination of proprietary technologies, trusted brands, and untapped market opportunity, and one I was excited to help shape. I came into this role with a clear understanding that realizing Maravai’s full potential would require change.

There’s important work ahead to position the company for sustainable, profitable growth. I spent my first sixty days understanding where we stand and where we can go next. We completed a top to bottom review of our strategy, structure and financial plans to sharpen our focus and reallocate resources toward initiatives with the greatest potential for impact and return. Through direct engagement with global customers and competitive benchmarking, we gained a clear view of where we lead and where we must sharpen our focus to win. I spent time with team members across the organization and gained a clear view of what’s working and where we face challenges.

I’ve been encouraged by the expertise and dedication of our people, but to move forward, we need to build a stronger culture of accountability and help our teams execute with focus and purpose. From these learnings, we’ve established a three part plan to put the business on the strongest footing to deliver on Maravai’s full potential. Let’s turn to Slide six. First, we are making a commitment to improve operational excellence and execution. On Friday, we initiated a restructuring plan designed to significantly reduce our operating costs.

Through reductions in headcount and non headcount related expenses across all functions in our organization. We expect to lower our annualized expenses by more than $15,000,000 These reductions will be phased in and should be complete over the next twelve months with the majority of the savings actioned on in the next two quarters. As part of the restructuring, we’re evolving from a more complex structure with higher overhead to a streamlined functional operating model. This includes consolidating executive roles and removing layers to accelerate decision making, reduce duplication and foster greater accountability and cross functional collaboration. One key change is to provide centralized oversight for TriLink R and D projects to ensure ongoing innovations are providing impactful value to our customers and the largest returns from RFI.

These decisions are never easy, especially when they affect valued colleagues. But the challenges RFI has faced post pandemic call for urgency and clarity in how we move forward. We’re approaching this process with care and respect, focused on minimizing disruption to our customers and positioning the company for long term profitability. I’m confident these organizational changes will strengthen the business. Raj will provide more details on these changes later in the call.

Second, we are focused on strategic levers for long term value creation, starting with revenue diversification and growth across each of our businesses. For Biologics Safety Testing or BST, this includes maintaining and building on our market leadership. We are investing in the development and launch of new analytical products tailored to the evolving needs of our Biologics and Cell and Gene Therapy customers. This investment not only supports our existing base of global biopharma customers, but also opens the doors to emerging players who require scalable and compliant testing solutions early in development through commercialization. We believe this business represents a highly valuable standalone platform.

It has high penetration across monoclonal antibody based products, recombinant vaccines and all FDA and EMA approved CAR T cell and gene therapies. With high contribution margins and a foundation of recurring demand, sickness is not only a core strength, it’s a strategic asset. We recognize the standalone value this segment represents and we’re committed to ensuring that this value is more clearly appreciated by the market. While the nucleic acid production or NAP business navigates a period of macro and political headwinds, our BSD segment provides visibility, diversification, margin stability and capital allocation flexibility. Within the NAP business, we are building on our GMP consumables capabilities.

We see this as an area where we hold a distinct advantage. Our large scale GMP capabilities are unmatched and we are actively expanding our product portfolio to support future mRNA applications, particularly in therapeutic categories such as oncology, autoimmune conditions and rare diseases. This is a vast evolving market and our ability to deliver reliable, high quality and scalable GFP products positions us as a key partner to our pharma, biotech and CDMO customers. For our CDMO business, we continue to make strong progress supporting customers from preclinical through commercialization. We’re not just a supplier, but an extension of our customers teams working side by side with them every day.

This trust and partnership leads to stickier relationships, helping us win follow on contracts as our customers program advance. It’s a key driver of both near term revenue and long term customer relationships, increasing the likelihood that we’ll support programs from early research through commercial launch. And for our research customers, we are broadening access to our technologies through innovation and expanding our consumables portfolio. We are also investing in our e commerce infrastructure and AI capabilities to provide a more streamlined commercial experience for our research customers. This month, we are launching a new version of the mRNA builder, our online ordering tool for custom mRNA that allows customers to design, order and build RNA using our products.

This tool is the first of several planned upgrades to our e commerce platform. These initiatives are central to our future growth and position us well for long term success. Third, with these actions in place, we will get the benefit of the margin flow through to return to sustainable positive adjusted EBITDA and free cash flow by the 2026. As a CEO, I have to make the tough calls that are in the long term best interest from RFI and our shareholders. We were structured for a much larger company than we are today.

And these actions will align the business to our current reality and allow us to grow revenue and profitability from here. We have great science and technology, and I’m optimistic that we are going to have a great future. While there is more work ahead and we continue our comprehensive business review and complete our budgeting process, I’m confident in our team’s ability to execute and be energized by the opportunity to build a stronger, more focused company for our customers, employees and shareholders. We have a clear plan and are moving quickly to return Maravai to growth and profitability. Now I’d like to introduce Raj Atsarpota, our new CFO, who joined Maravai on June 30.

As you can see on Slide seven, Raj brings over three decades of financial leadership experience across both public and private organizations, as they went through significant transformation and growth. I have personally worked with Raj at General Electric, Life Technologies and Antilia Scientific, And I value his leadership and financial stewardship as we continue building into a scalable, profitable and free cash flow positive business. I will now hand the call over to Raj.

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: Thank you, Bernd. I’m incredibly excited to join Marvei and partner with you as we embark on the next chapter for the company. I firmly believe we can unlock the full potential of what this company can deliver to both its customers and stakeholders. It’s clear to me that we have a world class team and cutting edge technology, and the opportunity ahead of us is truly unique. We are laying the foundation to drive operational excellence and disciplined growth as we strategically size and scale the business.

Now, let’s turn to the Q2 financial results on slide nine. Revenue for the quarter was $47,400,000 compared to $69,400,000 in 2024. Excluding revenue for high volume Clean Cap, base revenue was up 5% for Q2 versus 2024. The Nucleic Acid Production or NAP segment had revenue of $31,100,000 in Q2. The Biologics Safety Testing segment, or BST, revenue was $16,300,000 in the second quarter.

I will discuss segment results a little later in the call. Revenues by customer type in Q2 were 28% biopharma, 30% life sciences and diagnostics, 8% academia, 7% CRO, CMO, CDMO, and 27% to distributors. Revenue by geography was 65% North America, 18% EMEA, 12% Asia Pacific, excluding China, and 5% in China. Turning to slide 10. Our GAAP net loss before non controlling interests was $69,800,000 for the 2025.

This compares to a GAAP net loss before non controlling interests of $18,400,000 for the comparable 2024. Adjusted EBITDA, a non GAAP measure, was a negative $10,400,000 for Q2 twenty twenty five compared to a positive $13,000,000 for Q2 twenty twenty four. Moving to slide 11 and EPS. Basic and diluted EPS for the second quarter was a loss of $0.27 per share, compared to a loss of $07 per share in the 2024. Adjusted EPS in Q2 twenty twenty five was a loss of $08 compared to a loss of $01 in Q2 twenty twenty four.

Advancing to the balance sheet, cash flow and other financial metrics on slide 12. We ended the quarter with $270,000,000 in cash and $297,000,000 in long term debt. For Q2 twenty twenty five, cash used in operations was $10,300,000 Depreciation and amortization was $13,200,000 and interest expense, net of interest income, was $3,800,000 in the quarter. Stock based compensation, a non cash charge, was $6,800,000 for the quarter. Next to slide 13 and the discussion of segment performance.

The NAP segment had revenue of $31,100,000 in Q2. Base NAP business excluding high volume Clean Cap was up 3% year over year driven by demand for trialing GMP products. This was a sequential increase of 2,300,000 from $28,700,000 of base NAP revenue in 2025, marking our second quarter of base revenue growth in NAP. Adjusted EBITDA for NAP was negative $7,300,000 in Q2, highlighting the need for the cost reductions we have initiated. The BST revenue was $16,300,000 in the second quarter, up 10% year over year.

Adjusted EBITDA for BST was $10,900,000 for an adjusted EBITDA margin of 67%. The strong year over year growth in BST business was driven by demand for host cell protein kits and quantification services and increasing adoption of MOCV viral clearance products. Corporate shared service expenses impacting adjusted EBITDA totaled $14,000,000 in the second quarter. These services include centralized functions such as human resources, finance and accounting, legal, information technology, and the incremental expenses associated with being a public company. This is another large pocket of costs within the organization that we are significantly reducing with the cost actions announced today.

Turning to slide 14. Our strategic realignment and cost reduction initiatives are focused on improving how we operate by transitioning to more consolidated and functional organizational structure. This approach reduces complexity, fewer layers, tighter team alignment, and enhances our ability to operate with greater focus, speed and executional rigor. We anticipate more than $50,000,000 in annualized savings allocated approximately as follows: 45% to 50% from labor, 15% to 20% from facilities, 15% to 20% from CapEx reductions, and 15% to 20% from other productivity initiatives. Importantly, these actions are not expected to impact customer programs or revenue.

We remain fully committed to delivering the high quality products, service and innovation our customers rely on. As Bernd noted, we expect the majority of these savings to be in motion by year end with the full impact realized in 2026. While these are difficult decisions, they’re essential to restoring the company’s financial health and enabling us to reinvest in targeted purposeful growth going forward. In connection with these actions, we anticipate incurring restructuring charges of approximately $8,000,000 to $9,000,000 in the 2025. These costs will primarily consist of employee severance, benefits, and other related expenses.

I’d also like to take a moment to address our guidance philosophy for the balance of twenty twenty five. As a new leadership team, we are committed to providing guidance that reflects a high degree of confidence in our ability to deliver. Given that we are still in the midst of a comprehensive commercial deep dive, we have made the decision to withdraw our prior guidance range. We will look to reinstate guidance once we have completed a full business review and have a clear data driven outlook. In 2025, we have no orders for high volume CleanCap.

However, we are encouraged by early indications from a customer for high volume CleanCap for shipment that is anticipated in early twenty twenty six. Finally, before we move to Q and A, I’d like to share a few reflections from my first forty days. What I’ve seen is a company with tremendous runway ahead, and that’s exactly why I was excited to join Marwai. In addition to the immediate actions we’ve taken, we believe there are further levers we can pull to enhance profitability. The finance team is working closely with our new functional leaders and the sales organization to identify and execute on these opportunities as part of a robust budgeting process.

As part of this effort, we’re also upgrading our commercial metrics, introducing bottom up KPIs to validate our top down market assumptions and strengthen accountability across the organization. We’ll provide more detail on this progress in our Q3 call. Additionally, I’m addressing some of the operational headwinds we’ve encountered in the past, particularly around the audit process to ensure that areas within our control are managed with tighter execution and discipline. This includes onboarding a new controller and audit partner. I’m laser focused on closing the year strong, and I’m confident we are on the right path.

I’ll now turn the call back to the operator to begin the Q and A session.

Earnings Call Operator/Moderator: We’ll We’ll go first this afternoon to Matt Stanton of Jefferies.

Matt Stanton, Analyst, Jefferies: Hey, thanks. Maybe just to go back to kind of the guidance philosophy. I mean, it sounds like you’re still taking a closer look at the forecasting process. On one hand, you’re pulling the 25 guide. At the same time, you’re talking about cost actions and pointing to positive adjusted EBITDA and free cash flow in the back half of ’26.

So I guess, how should we think about how you’re feeling about the visibility, especially around the latter with the ’26 targets? And then just given we sit midway through 3Q here, was there any thought to potentially shifting to some form of quarter to quarter guidance in the near term? Thank you.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: Hey, Matt. This is Bernd. Let me make a few comments on that, and then I’ll see if Raj has anything to add to it. First and foremost, I think we’ve been on board now for less than a couple months here and our primary focus has been getting costs under control in this business. It was just something that was an obvious issue we had.

We had to deal with that. That meant some changes to the commercial organization. Add to that the announcements last week from Kennedy on some of the mRNA funding here. It’s just important for us that we really get our arms around this and bring confidence back to the street on the numbers that we share. Are there any specific red flags that we see that say, well, guidance that’s been given is not correct.

That’s not it at all. It’s just us having the right amount of time to really get our arms around this. Now, as far as running this company in a positive growth and a free cash and EBITDA point of view, regardless of where these revenue numbers sit, we’re going to run that in a positive way. I think we’ve taken some great steps to take the right amount of costs out of this business. Last Friday, we took those first steps by reorganizing the organization.

But one way or another, wherever revenue lands, if that means that there’s additional things that have to happen, we’ll take care of that. Although we have no indication that that needs to be done at this point. So I think this is just the result of us just needing a little bit more time. You know, the interesting part of Meravai, it’s a fairly lumpy business, unlike the traditional life sciences tools and certainly even Maravai before COVID, very much a run rate business. If you look at the business today, average order sizes are materially greater than what a run rate business would be.

That means just have a little bit more susceptibility to performance by quarter. And we just got to get our arms around that. It’s nothing more than that. Rush, anything else?

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: Yeah, I think I just kind of reemphasize that Bernd and I are both committed to operating the business with an expense profile that can achieve positive EBITDA by the 2026. As Bernd mentioned with the restructuring, we also had to change we had to change out on our sales leadership side, which also impacts kind of how we think about guidance. And then, Matt, your final question was around quarter to quarter guidance. We’re not going to do that. Again, until we have our arms around the whole business, we’re not going to provide that quarter to quarter guidance for now.

Matt Stanton, Analyst, Jefferies: Thanks. That’s helpful. Then maybe just on 2Q, BST nice quarter, I think typically 1Q seasonally stronger there. But if I exclude 1Q the last few years, I think 2Q was the highest dollars in that business going back to the 2022, if my math is right. So can you talk about the durability of kind of the improvement in solid trends you saw here in 2Q?

Then can you just clarify that you are not seeing any pull forward dynamics out of China or Asia in that business in 2Q? I know some other folks in the bioprocessing chain have kind of called that out, just level of visibility into no pull forward dynamics into that 2Q number. Thank you.

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: Sure. I’ll take that. So, you’re right. On the BST side, if you look at the different parts of the portfolio, so like on our wholesale protein kits, which is basically our gold standard, those kits grew by 7% in the quarter, which again demonstrates our position that customers are remaining loyal even in this market uncertainty. Mockweed, that’s been a great story.

So that portfolio continues to grow at a super rapid rate. The adoption is really strong and there’s a lot of confidence in that product’s performance. Likewise, on quantification services, it continues to grow. We’ve got many, many repeat customers there and our focus on tactical programs to engage on new accounts is also starting to kind of work well. To your question around, you know, pull forward, we did have a little bit of that in China, but nothing too material.

So right now, I think as far as the Cygnus business goes, it’s very healthy and showing a good growth rate. That said, though,

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: I think 10% off is an incredible quarter. I don’t think you model that in. Right? I think this business should be a mid single digit top line grower for the moment, and we’ll continue to optimize this business as well.

Matt Stanton, Analyst, Jefferies: Appreciate it. Thank you.

Earnings Call Operator/Moderator: Thank you. We’ll go next now to Matt Hewitt of Craig Hallum.

Matt Hewitt, Analyst, Craig Hallum: Good afternoon. Thanks for taking the questions. Maybe first up, regarding China, with kind of the easing that we’re seeing between The U. S. And China, do you anticipate that that could become a growth driver?

Do you think that that’s a region that could start to scale as we get into 2026?

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: Yeah, I think so. I guess in one word, the answer is yes. We would expect that to be a good kind of growth lever.

Matt Hewitt, Analyst, Craig Hallum: Great. And then maybe a follow-up. Go ahead.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: I’m sorry. I think just in general, right? If you look at the global markets, not just for biosafety, but the Samarivai product lines, The US is going to see some obviously retraction given the deep focus on mRNA. I think you’re going to see continued increase investments in the non US regions, and we’re well positioned to take advantage of those. That includes China, but I think other non US regions as well.

Matt Hewitt, Analyst, Craig Hallum: Excellent. And then maybe a follow-up question and a little bit different here. But regarding the CDMO business, how do the prospects or the potential for tariffs on imported drugs, how does that affect your business? Does that create incremental opportunity? And have you seen that in your pipeline?

Or is everyone kind of sitting on their hands waiting to see what’s going to happen there? Thank you.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: I think it’s more of the second at the moment. We haven’t seen a whole lot move from there yet. Is there certainly an opportunity that if tariffs really settle in on this and make it economically beneficial for some of the non US manufacturers to move production to The US? For short discussions we’ve had, I don’t think it’s anything we’ve actively seen. But in the event that were to happen, our facility expansions have happened here over the last years position us incredibly well to take advantage of that.

Matt Hewitt, Analyst, Craig Hallum: That’s great. Thank you.

Earnings Call Operator/Moderator: Thank you. We’ll go next now to Subbu Nambi of Guggenheim Securities.

Subbu Nambi, Analyst, Guggenheim Securities: Hey, guys. Thank you for taking my question. As you were reviewing different aspects of the business, were there things that you were positively surprised by? And then similarly, anything that you didn’t anticipate would be very challenging but was challenging.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: Well, that’s a good question. I think anytime you come into a new organization, as much diligence as you do, you will find surprises in the end. And I think if I reflect for myself here, and I’ll let Rajvi make some of his comments, I’ll lead this off with, again, saying it’s fairly early days. Quite surprised by the amount of expenditure that’s happened in this organization. It was really scaled for an organization so much bigger than we are.

And I think that was a much greater extent than we even anticipated. I mean, the numbers that we are taking out of this business, and we feel we’ll have fairly limited impact, if any, on our day to day operations kind of shows you how heavy this organization was layered. Certainly a big surprise there. Think on the positive front, I think if you look at the customer profile we are working with here, particularly in this sort of preclinical through phase three, there’s a ton of activity going on there. I mean, we talk a lot about COVID vaccines and the impact of capping and how that grew this business.

And that’s really at zero this year. But the fact that there’s still so much activity going on with customers for that same portfolio, But again, primarily focused on oncology, autoimmune rare disease kind of solutions, really positions the company incredibly well for I think where mRNA will go in the future. So that I think was an incredibly positive direction. And then you’ve heard us talk about our biosafety business in Cygnus. Think that organization has struggled a little bit in the past.

You’re starting to see that come around. There’s some great innovation happening there. Certainly a great brand around the world. We talked Asia a little bit ago. I think there’s huge upside in that region for this portfolio.

So I think lots of good movement happening for the portfolio at large. We just now have to get to the part where those all come to fruition and we execute on those.

Subbu Nambi, Analyst, Guggenheim Securities: Thank you for that, and thank you for the thoughtful response too. I know you said there’s a lot of focus on clean cap, but could I just, if possible, add one? You said you had encouraging conversations with a customer for a shipment in early twenty twenty six. Could you provide some more color here, like just confirming you’re defining high volume clean cap the same way as before?

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: Yeah. I’ll take that one. So, yeah, we do have an indication and a binding order for high volume clean cap in ’26. We’re not going to give you the name of the customer or any additional color yet till we’ve got things sorted out. But, you know, I think it’s an encouraging sign.

We don’t expect high volume clean cap to return to the 2024 levels. But having said that, this is at least, you know, a step in the right direction. We are basically going to run our business just like we have done this year in, you know, thinking that anything that we get from high volume clean cap is really going to be more upside. All of our business is gonna be managed as if we had no clean cap in our model. So, you know, to the extent that these orders come in, there’ll be a nice incremental kind of goodness to the business, but we’re not counting on it.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: But maybe use this opportunity to set the stage of how we label things. So high volume clean cap really is COVID clean cap, right? Let’s call it that. We’re going to get away from that kind of terminology. High volume clean cap in the end hopefully will be many other therapeutics that go to commercialization and we’ll use our caps and other consumables to manufacture those therapeutics.

So high volume clean cap, this question is exactly how you would have thought about it in the past. As we progress, assume that will be labeled differently. But that’s just sort of setting the stage for the future here.

Matt Larew, Analyst, William Blair: Yeah.

Subbu Nambi, Analyst, Guggenheim Securities: Thank you for that, guys. Good

Brandon Couillard, Analyst, Wells Fargo: luck. Thanks.

Earnings Call Operator/Moderator: Thank you. We’ll go next now to Kyle Cruz of UBS.

Kyle Cruz, Analyst, UBS: Hey, thank you for taking questions. You know, peers have talked about multi year headwinds in scientific R and D spend going forward. You’ve achieved, you know, mid single digit base business growth. Not commenting on the current guidance, but looking forward, how should we think about the business over the midterm and how it should and how your growth outlook of the business is? Thank you.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: I’ll take a couple of comments here and I’ll hand it to Raj. I mean, clearly, you can feel great about The U. S. Funding environment in research, specifically in mRNA. Our business exposure today is not that significant there.

Get most of our revenues from other parts of the business, including GMP and CDMO at this point, certainly from biosafety. But I think at a much broader picture for The US markets, we’re going to continue to see material research investments outside of The US. And, you know, that wouldn’t be great to see where that leads for this country in the future as it relates to a new therapeutic to market with this technology. So I think our business directly won’t have material impacts, but it would be a shame to see for this market locally here not to start coming back into mRNA research in the long term.

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: Yeah, I think the only thing I’ll add is, again, our Q2 base revenue growth was around 5%, and we are looking to accelerate that. Although like Bernd mentioned, there is variability quarter to quarter. But as we look at kind of what our peers are saying, the long term growth of this business is mid single to high single digits, whether it’s Danaher at 7% to 9%. We’ve heard Thermo citing market growth at about 6%, Sartorius at 8% to 12%, and Lonza at 8% to, you know, like 8% to maybe 10%. So that’s kind of where we see this business heading.

Matt Larew, Analyst, William Blair: Great, thank you.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: I think the key takeaway guys here is, when it relates to GMP and CDMO, I think the markets will continue to be healthy here. There’s a lot of programs out there where we’re involved with. And I think there’s a high level of confidence that will help us out. I think our emphasis to continue to focus on some of the non US markets in research has become ever more important with the recent news that has happened.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences0: So can we go to the next question, please?

Earnings Call Operator/Moderator: We’ll go next now to Brandon Couillard of Wells Fargo.

Brandon Couillard, Analyst, Wells Fargo: Thanks, guys. Good afternoon. Burns, you talked a lot about e commerce in your prepared remarks as part of the strategic review. It’s not been a topic that’s, I think, come up much in the past. Do you think you were missing out on revenues before?

How much of the revenue base is currently e commerce today? And where should that be over time?

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: And what kind of investment do you need to make there? Thanks. Yeah, it’s a great question. I mean, starters, do I think it’s important? Yes.

Today’s revenue in Miravai is not very significant in the research world, and I think that’s really where e commerce helps you out. It’s not that economically viable to put a large team of salespeople in the field for fairly small average order size opportunities, particularly with a fairly narrow portfolio that we have here. So it is very important. As you know, we bought EfficientA earlier this year. They really have a really nice AI engine that will help design custom RNA for research customers.

We just brought that live on-site, I think, last week in sort of a beta version. We expect that to go primetime later in the year. And that, I think, will be a big driver in the uptick of research consumables, specifically custom mRNA and associated consumables for the business. So critically, yes, at the moment. So a fairly small portion.

In my personal background, I come out of sort of large life sciences tools companies with much higher number of order volumes a day, much broader portfolios. I think it’s even more critical there than our world. But for us, I think creating this custom mRNA world in an e commerce fashion without any really sales involvement will become very valuable in the long term for the business. And today, you asked a question, don’t have these numbers offhand, but do we do we have what the total revenue coming in from e commerce is today? It’s a fairly small percentage.

It’s very small. Yeah. It’s it’s it’s it’s single digits is my guess.

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: Yeah.

Brandon Couillard, Analyst, Wells Fargo: Okay. And then just one clarification. I mean, based on your comments about the strategic review, it sounds as if you’re pretty committed to keeping the BST business in the portfolio. I just want to make sure that it’d be safe to conclude that kind of based on your initial assessment. Thanks.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: Yeah, listen, our goal as a leadership team is to create value for our shareholders. And so what that means that in the long term, whether that is selling assets or buying assets or organically investing, we’re not ready to make any comments on that.

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: Yeah. What I would add is just basically us focusing on restructuring the company, making it profitable, just gives us so much optionality and flexibility. So all these decisions will be a lot easier once you have that optionality. So right now, we are focused on growth and that’s where we’ll deliver value to the shareholders. So stay tuned on that.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: Thanks.

Earnings Call Operator/Moderator: We’ll go next now to Catherine Schulte of Baird.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences0: Hey, guys. Thanks for the questions. Maybe first, just understand the need to take a fresh look at forecasting and budgeting, but is there anything you can talk to about near term trends? There have been so many policy headlines in mRNA and cell and gene therapy. It could just be helpful to hear what you’ve been seeing in July and August and maybe how your customers are responding to some of those.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: Ross, I’d like to take a first step of that.

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: I think trends right now are fairly positive. We are again, like I think we mentioned a little while ago,

Brandon Couillard, Analyst, Wells Fargo: the

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: CDMO business is kind of lumpy. So we are, again, with new KPIs around trying to look at customer detail, regional details, price volume, all those KPIs and metrics are what we’re kind of diving into. But overall, it’s a reasonably positive trend that we’re seeing.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: Yeah, and again, you got to keep in mind here, a lot of the news that’s coming through on funding is heavily tied to research, right? And we just don’t have a big exposure there during COVID and we can debate right or wrong. But during the COVID years, this company was focusing purely on clean cap business for COVID vaccine manufacturing. And a lot of the emphasis on that research was taken away during those years. We’re rebuilding that up, it’s just not a big part of our base anymore.

I think if we sat in a world where a lot of our revenue was tied to academic research, we probably would have a different position. We haven’t heard much from customers. There’s been one or two customers that I think we’ve heard from that may have a little bit of a funding issue, but nothing material to the business.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences0: Right. Great. And then you’re taking steps to right size the organization. If we look back at Maravai pre COVID, the company had north of 40% EBITDA margins. There’s obviously been a lot of capacity expansion investment since then, plus some public company costs.

But just as we think about longer term, is this still a business that can support those types of margins? Or should we think about it as structurally different today?

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: Well, I think it’s too early for us to answer that question. I mean, for starters, for sure, we’d like to think we can get this business back to volume and profitability where it should be. I think for us, step one is to get free cash flow positive direction in our business and EBITDA growth. So let’s take that step first and then we’ll go from there. You know, sometimes, you know, somebody asked me a question earlier here about, you know, some of the surprises of what I have seen coming in here in these first couple of months.

And early sort of indication for me was, well, prior to COVID, there was a certain cost base and that is materially higher today. I do think that a lot of that cost is coming out. That’s good. But you also have to keep in mind that we do have GMP manufacturing capabilities today that inherently are a little more expensive. They will have a little more cost basis, but it also sets you up for some really, really large deal opportunities and some high margin consumables.

So kind of lumpiness we’ve been talking about. I think we are right sized. I think we are playing with a portfolio that is incredibly well positioned for new mRNA therapeutics coming out in the future. How that will play out over the short term, I think that’s what we’re getting our arms around. First and foremost, again, getting this business back to profitability versus what we’ve seen in the last six months here is our first and foremost priority.

Earnings Call Operator/Moderator: Thank you. We’ll go next now to Doug Schenkel of Wolfe Research.

Earnings Call Operator/Moderator: Hi. This is Madeline Mullen on for Doug. Regarding the risk, which is always a difficult decision and process, can you break down where the cuts were being made and also where you didn’t make cuts? We just wanna better understand how you’re balancing cuts versus working to reinvigorate growth. And then building off of that, regarding the eliminating the CCO position, what does that mean for changes in commercial strategy?

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: All right. Let me take a couple pieces here. Did you say chief technology officer or chief commercial officer?

Earnings Call Operator/Moderator: Chief commercial officer.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: Yeah. So on the I’m sorry, the first part of the question.

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: I’ll take that one. So on the

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: chief commercial officer side, we have a very, very large commercial organization that simply needs to be scaled back to where I think the focus should lie. Given the number of larger opportunities that exist, having a very strong field sales organization is critical. So we have hired a new EVP of Sales who will be responsible for selling all of our larger GMP manufactured products, CDMO products around the world. I think that that is a specific skill set required. Secondarily, having a chief marketing officer who will take the lead in this e commerce world that was brought up earlier becomes equally critical.

I think those are two very, very different skill sets. A company our size, you just kind of need to separate that out and focus on those separately. So this is nothing more than just some organizational realignment, focus on sales for larger deals, focus on e commerce for some of this research business, and executing on that. I will also say that’s primarily tied to Trilink and not to our Cygnus business. I

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: think the other question, the other part of your question was around where this is, where the reductions are coming from. So, if you think about the $50,000,000 half of that is going to be 50% from G and A. You’ve got about 20% to 30% on kind of sales and marketing, and then about 10% to 20% from R and D. So, a little bit more color around we’ve consolidated these executive roles, Bernd mentioned, removed layers in the organization, and centralized it to a functional alignment to improve kind of how we work and strengthen the company’s financial health. So these actions basically will streamline our decision making, kind of remove duplication of efforts that we’ve seen, and just foster greater accountability as we execute and kind of move forward.

Does that answer your question?

Earnings Call Operator/Moderator: Yeah. Great. That was really helpful. And then just one more regarding the high volume Clean Cap order you think that might come in 2026. Do you need that order or other high volume clean cap orders in 2026 to meet your goal of being EBITDA and free cash flow positive in H2 twenty twenty six?

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: No. You’re okay. No. I’ve made that clear. We are operating this business like we had no clean cap.

And anything that we get is going to be upside to what we’re planning.

Earnings Call Operator/Moderator: Great. Thank you.

Earnings Call Operator/Moderator: We’ll go next now to Matt Larew of William Blair.

Matt Larew, Analyst, William Blair: Good afternoon. Thanks for taking my question. You mentioned a couple of times throughout the call, you highlighted the standalone value of BST and also referenced working to create a vision for what an attractive life science tools asset would be. If we think back to how Marvell was created by aggregating four independent assets in different parts of the country, some of them hidden products like HCP, some of them, large fixed cost reagents offerings like, like, NDP business, San Diego. It was sort of, as you referenced built to be a bigger diversified company.

Some of that you’ve paired off over the years, like the protein business. Now, as you think for the future, how do you think about rightsizing what you’re doing from an operational standpoint, but then rescaling to your point that attractive life science tools would be, do you think building around customers as you did before, around capabilities, around geographies? I understand that it’s early, but as you got together with the Board and you just accepted these jobs, what was sort of the vision here?

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: For starters, I think it’s a really good question. If you look at Maravai when it started, honestly, I think it was a little bit more of a holding company set up at buying good assets at good valuations and kind of trying to optimize those accordingly. I’m not a 100% sure that had a really well thought out exit strategy at the time, but this is 2018 or whatever, maybe even earlier, so some time ago. Why did we call out biosafety in our earnings call, you know, I think two or three times? I think it’s just a reality.

If you look at Miravai today and where it trades, that business is incredibly valuable as an asset. And 99% of the discussion we’re having are on TriLink business. So I think we’re just trying to call that out as an asset that we shouldn’t overlook. We must understand the value that that brings. And whether we are going to sell that or not, as I said earlier, Raj responded to, we’re here to create ultimately shareholder value.

And the decisions we’re going to make, whether we divest or whether we acquire other assets and leveraging our capabilities to put those together, Well, that will happen. We will think about after we stabilize this organization, how can we add new assets into the business to make these assets stronger? And we’ll think about whether or not some fit or not. But we are by no means ready to make those decisions to date.

Matt Larew, Analyst, William Blair: Understood. You referenced obviously the timeline for the operational changes in terms of most of them occurring by calendar year end. It’s more challenging to put timelines on strategic reviews. I get that, but there’s obviously an element of an overhang with be it on employee turnover or customer conversations with this out there. Do you have any sort of sense for a timeline you’d like to hold yourself to sort of a merge on the other end of the strategic review?

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: Yeah. Well, for starters, think we’ve been here for less than two months and you’ve seen the massive overhaul we’ve done in a very quick period of time. So we are not a management team that sits on its hands very long and makes no decision. So you can safely assume that as we put these first steps behind us in rightsizing the organization to start thinking about and executing on what is a strategic plan moving forward beyond that will come rather sooner than later.

Matt Larew, Analyst, William Blair: Okay. Thank you.

Earnings Call Operator/Moderator: We’ll go next now to Dan Arias of Stifel.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences1: Afternoon, guys. Thank you. I was going to ask a question about M and A there, but I think you kind of covered that. So maybe I’ll just ask one on the fixed cost base of the company. That’s been a bit of an issue for margins at times when the top line view changes.

Do you see it as possible that the company can come to better absorb deviations at the revenue line? Is that something that you think can evolve or is it just sort of the nature of the business such that you’re of beholden to the way fixed costs are set up for the company?

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: I’ll take a macro look at this. This may be something we need to have as a follow-up call to get exact numbers to you. But, you know, obviously, this business has built a ton of infrastructure over the last years and that does give you a bit of a hangover when your revenue materially changes. When we look at our cost savings, our old corporate offices in San Diego that have not been used now for some time that leases up, I think in September year. So that’ll fall away.

We have some other facilities we’re looking at potential other opportunities to work with. But right sizing that part, although it’s not the largest part of our restructuring, I think it’s partially decided on in other areas we may think a little bit longer about. Somebody asked a minute ago about, are there potentially European or Asian pharmaceutical companies that need some US footprint? We have some facility space here that we could use for that. So instead of actively getting out of that type of infrastructure, you want to breathe a little bit to see what happens in the next six months or so.

But I think in general, we feel good about sizing the organization right with our infrastructure over the next six months.

Raj Atsarpota, Chief Financial Officer, Maravai Life Sciences: Yeah. Which will give us more flexibility on gross margin for sure and operating margin.

Matt Stanton, Analyst, Jefferies: Okay. Thank you.

Earnings Call Operator/Moderator: We’ll go next now to Matthew Parisi at KeyBanc Capital Markets.

Matt Larew, Analyst, William Blair: Hi. Yes. This is Matt Parisi on for Paul Knight at KeyBanc. I was wondering if you could kind of go into more detail on the, extended CDMO enablement strategy that you mentioned in your press release regarding the new license and supply agreement for CleanCamp with Thermo Fisher.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: I’m not sure what this question is. CDMO and licensing on Cleantat? That’s specifically the thermal one. Listen, I think that’s just another example of of, you know, clean-cut being used not just by our own CDMO capability, but broader CDMO as well as pharmaceutical manufacturing. Yeah.

Clearly, that’s one of our if you look at our consumable space, GMP consumable space, having as many targets out there, whether they are manufactured by a pharmaceutical company or whether they’re manufactured by a CDMO, ours or somebody else’s, we want CleanCap to be used as much as possible. And this agreement was just another licensing agreement with Thermo, and that will hopefully lead into a number of opportunities beyond from what we have today.

Matt Larew, Analyst, William Blair: Okay. Thank you. That’s really my question.

Earnings Call Operator/Moderator: Thank you. We’ll go next now to Justin Bowers of Deutsche Bank.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences2: Hi, good afternoon everyone. Just a two parter for me. You talked about the preclinical market earlier in the prepared remarks. Can you discuss some of

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: the

Bernd Brust, Chief Executive Officer, Maravai Life Sciences2: trends that you’re seeing in either the order book or the RFP volume over the last call it six to twelve months? And then part two would just be on the broader commentary on mRNA. Are you starting to see opportunities ex U. S. As a result of some of the announcements and sort of the policy and regulatory environment since last November?

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: Yes, I’ll give you more of a macro answer and then maybe Raj have more some specifics. I’m not sure what we have in front of us here, but I think if you look at the broader market, there’s no question that the number of targets that are out there that are appearing in preclinical, moving their way through Phase one, two, three, I think is a solid number. When you look for instance at our Q2 numbers, although still in research, it’s mainly GMP consumables that are picking up there. So I think there’s good activity there. Much of it still sits in The US, quite frankly.

But as we look at our funnels outside of that, I don’t know the exact numbers here, but we’re seeing great growth as it relates to GMP manufactured consumables, which all sits in clinical trial stages. If I recall in Q2, our research growth primarily came from GMP consumables.

Earnings Call Operator/Moderator: Thank you. And gentlemen, it appears we have no further questions this afternoon. Mr. Breast, I’d like to turn things back to you, sir, for any closing comments.

Bernd Brust, Chief Executive Officer, Maravai Life Sciences: Thank you. Again, thank you everybody for joining us today for my and Raj’s first conference call since joining Marabai. As we outlined in the prepared remarks, there’s much work to do, but we’re well underway. Through organizational restructuring, cost reduction initiatives, we are focused on driving speed, accountability and operational excellence across the portfolio to fundamentally transform our business model. These are structural wholesale changes to how Maravai operates from headcount and organization design to cost base and accountability.

The unique value we offer in our portfolio of our brands provide our customers for the life changing development of the next generation medicines and diagnostic is unmatched, and we will focus on areas where we see the highest returns to drive growth and diversify the business. I believe we can build a stronger, more focused company for long term sustainable growth, beginning with a return to positive adjusted EBITDA and free cash flow in 2026. I thank you again for all your questions and your time and the interest in Maravai. Take care everybody.

Earnings Call Operator/Moderator: Thank you, Mr. Brust. Again, ladies and gentlemen, that will conclude today’s Maravai Life Sciences second quarter earnings call. Again, thanks so much for joining us, everyone. We wish you all a great evening.

Goodbye.

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