Twist Bioscience (TWST) Q3 2026 earnings call transcript

Thank you, Operator. Good morning, everyone. I'd like to thank you for joining us for Twist Bioscience's conference call to review our fiscal 2026 third quarter financial results and business progress. We issued our financial results press release before the market, and it is available at our website at www. twistbioscience. com. With me on the call today are Dr. Emily LaPruce, CEO and co-founder of Twist, Adam Loponis, CFO of Twist, and Dr. Patrick Finn, president and COO of Twist. Today, we will discuss our business progress, financial and operational performance, as well as growth opportunities. We'll then open the call for questions. We ask that you limit your questions to only one and then re-queue as a courtesy to others on the call.

This call is being recorded and the audio portion will be archived in the investor section of our website and will be available for two weeks. During today's presentation, we will make forward-looking statements within the meaning of the U. S. Federal Securities laws. Forward-looking statements generally relate to future events or future financial or operating performance. Our expectations and beliefs regarding these matters may not materialize and actual results in financial periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks include those set forth in the press release we issued earlier today, as well as those more fully described in our filings with the Securities and Exchange Commission.

The forward-looking statements in this presentation are based on information available to us as of the date hereof, and we disclaim any obligation to update any forward-looking statements except as required by law. We'll also discuss adjusted EBITDA, a financial measure that does not conform with generally accepted accounting principles. Information may be calculated differently than similar non-GAAP data presented by other companies. When reported, a reconciliation between GAAP and non-GAAP financial measures will be included in our earnings documents. Which can be found on the investor section of our website.

With that, I will now turn the call over to our CEO and co-founder, Emily Lepoost.

Thank you, Angela, and good morning, everyone. On slide three, you will see that this morning, we reported our 14th quarter of consecutive growth, with record revenue of $118.4 million, growth of 23% year-over-year. This growth reflects the diligence and execution we have employed over the last several years, Building for opportunities we see ahead. Sometimes those opportunities are clearly visible many years in advance, and others require us to be nimble and engage with our customers in real time to ensure we build and deliver what they need to be successful. On slide 4, you'll see that at Twist we sit at a unique junction where we have spent the last decade building the infrastructure to enable our customers to advance the therapeutics, diagnostics, and industrial breakthroughs resulting from their innovation.

As biology becomes increasingly computational, our ability to deliver precision and speed at scale becomes even more valuable. On slide five, I'm sure you agree that AI is shifting workflows across multiple industries, and we see an inflection point in drug discovery, with more and more groups leveraging AI as their first antibody discovery screen. Well, one year ago, just a handful of organizations were pursuing this path. Now we have seen large pharma, dry lab biotech, traditional biotech, and even major technology companies all employ AI through mere AI approaches, following the pattern of design-built test loop. Our customers cannot design more sequences, test more hypotheses, and iterate faster than ever before. In parallel, we also see the benefit of data and genetic information resulting in diagnostic assays that monitor, select, and determine next steps for a wide variety of diseases.

Turning to our product groups, over the past year, we've talked about AI-enabled discovery as an important emerging opportunity. Today, we are seeing that opportunity mature into a durable growth engine. We continue to support customers in building new models, while others are using Twist to conduct discovery for specific specific targets and to iterate models. This combination of repeat business, new customer acquisition, and new organizations forming or expanding into the life sciences area gives us increasing confidence in the durability and longevity of AI-enabled discovery as a growth driver for the short, medium, and long term. On slide 6, the premise of AI-enabled drug discovery is straightforward. Identify better drug candidates faster, reduce the cost of bringing new medicines to market, and improve the probability that candidates entering development ultimately succeed.

On slide 7, you'll see the workflow where our customers use AI to competentially generate thousands to millions of potential DNA sequences, and iteratively refine those designs to identify the most promising therapeutic candidates for a specific disease. Twist quickly translates those digital designs into physical biology through high throughput DNA synthesis of individual or pooled DNA, followed by protein expression. Many customers then leverage our downstream capabilities to evaluate those proteins across assays, measuring binding, the reliability, characterization, and other properties associated with successful drug candidates. We enable rapid design, build, test, and learn cycles at the earliest stage of discovery, supporting our customers' ultimate objectives. When seeking a partner for this work, every customer needs a trusted provider capable of manufacturing increasingly complex DNA sequences, expressing protein, generating high-quality characterization data, and delivering consistent results at the speed modern drug discovery requires.

This combination of capabilities has become one of Twist's most important competitive advantages. As our investor day in May, we guided to triple-digit percentage order growth for AI-enabled discovery in fiscal 2026 versus fiscal 2025. Now that we are through the third quarter of the year, we are increasingly confident that we will meet or exceed that target. Our confidence reflects durable demand signals as existing customers return for iterative design build, test, learn cycles, Reflecting growing recognition that our platform is well suited to support AI-enabled drug discovery programs, as well as traditional drug discovery. Importantly, our funer of opportunities continue to expand meaningfully, and we believe that we have the potential to again post triple digit percentage order growth for AI-enabled drug discovery in fiscal 2027 when compared to fiscal 2026.

Turn to slide 8. During the quarter, our platform again demonstrated its importance in supporting global public health. On May 15, 2026, public health officials in the Democratic Republic of Congo announced a developing outbreak of hemorrhagic fever. The outbreak went undetected for at least a month, escaping standard PCR assays, a gap that allowed the virus to spread further before it could be identified and contained. As of July 1st, the virus has been confirmed in both the DRC and Uganda, with an estimated spread to several thousand people and at least 399 confirmed deaths. Approximately one month into the outbreak, researchers used Twist comprehensive viral panel to identify the pathogen as the Bondi-Bondi-O Ebola virus, Underscoring the value of whole viral genome enrichment to catch emerging infectious diseases that standard testing missed.

Separately, we also synthesized antivirus material in less than 24 hours to support rapid response efforts during the cruise ship outbreak in Maine. These are powerful examples of the breadth, speed, and reliability of our platform, and of our role in the global research and public health communities. On slide 9, we continue to see strong accelerating momentum for our NGS applications group, driven primarily by diagnostic customers, many of whom are focused on growing their commercial volumes with others advancing towards commercialization. We have our eyes on several new opportunities. As the pipeline remains rich for next-generation assays, tumor-informed molecular residual disease tests optimize workflows using proprietary enzymes and more. During the quarter, we increased customer adoption, strengthened our commercial pipeline, and continued to execute on new product introductions to reinforce our position as a trusted partner for next-generation sequencing workflows.

As sequencing volumes continue to grow globally, we believe our differentiated technology and expanding portfolio positions do us well for continued growth. We continue to see customers turn to twithes when scientific precision and rapid execution matter most. This holds true when we are supporting academic research, cancer diagnostic, agricultural biotech, responding to emerging infectious diseases, or myriad other work streams.

On slide 10, one of the allies of the quarter was hosting our Investor Day at our FAB in Wilsonville, Oregon. Many of our customers shared how Twist products and services play a critical role in the internal workflow, providing tangible examples across multiple markets and applications. In addition, several Twist leaders showcase their expertise and leadership throughout different areas of the business. As Twist has grown, we have built an organization designed to repeatedly convert scientific innovation into commercial success. Great science creates opportunity. Operational General excellence turned that opportunity to durable revenue growth, expanding profitability, and long-term value creation. That requires manufacturing discipline, commercial execution, digital capabilities, and above all, an exceptional team. Investor Day gave us the opportunity to demonstrate the strength of that foundation through our leadership bench, differentiated technology, highly automated manufacturing, expanding capacity, and the The consistent feedback we received was that investors left with a broader appreciation of the scale of our opportunities, the strength of our execution, and the depth of our organization we have built, as well as the reality of the growth opportunities that lie ahead to drive confidence in our long-term trajectory.

For me, Investor Day reinforced something I've believed since founding Twist. We do things the Twist way, and this is not the easy path. When someone says If it's hard, I say yes, that's the point. If it were easy, everyone would be doing it. Building what has never existed before requires relentless innovation, disciplinary execution, and clear communication. What began as a founding principle has become how Twist operates. It's embedded in our systems, our processes, and more importantly, our people. That's how we scale innovation consistently, build trust with customers and investors, strengthen our competitive advantage, and create long-term shoulder value. I'd like to turn the call over to Paddy, who will discuss our competitive mode, how we're executing against our priorities, and why we believe the operational foundation will build positions TWIST for its next phase of growth.

Thanks, Emily. Good morning, everyone. One of the things I enjoyed most about Investor Day is that people got to see TWIST from the inside. They didn't just see the products, they saw how we operate. Twist's core technology differentiation is a semiconductor-based DNA synthesis platform that provides a structural advantage in cost, scale, and speed that feeds into every product and service we offer.

The same platform also enables a highly efficient new product introduction engine, allowing us to rapidly translate customer demand into scalable offerings and continuously expand our portfolio. As we increase volume on the silicon chip, we expand our wallet share, accelerate product innovation, and further strengthen our competitive advantage.

However, as Twist has grown, one thing has become increasingly clear to me. You'll see on slide 11, our competitive mode expands well beyond our robust IP position around the chip into a complex infrastructure where manufacturing, automation, software, commercial execution, product development, customer engagement, Scientific innovation and critically, the customer experience all reinforce one another. Every improvement we make strengthens the platform. Every new capability benefits multiple parts of the business. Every automation project improves quality, productivity and throughput. And every customer we add helps make the platform stronger. It's something we've been building deliberately for years. It's also why I believe our advantage continues to expand. Customers are looking for a partner that can help them move faster, and we're becoming more deeply embedded in our customers' research and development activities.

That creates more durable relationships and over time, a stronger business. And that doesn't happen without exceptional and consistent execution. Every day our teams are focused on delivering exceptional quality, increasing productivity, expanding capacity, and reducing turnaround time. These priorities don't change, there's no finish line, and we measure ourselves by how consistently we improve. On slide 12, I talked earlier about our silicon chip shown on the left. It's been the foundation of our commercial manufacturing platform since 2015. By miniaturizing known phosphoramidate chemistry and dramatically reducing reagent consumption, In the meantime, the last three years of the year, we have reduced manufacturing costs by 60%, reduced waste by 70%, reduced turnaround time by roughly 73%, and increased oligonucleotide capacity.

Our year, this is the only thing that I have to do with my team. It's a good idea. And I will now turn the call on the Twist Bioscience Corp. I will now turn the call on the Twist Bioscience Corp. It requires molecular quality, reproducibility, manufacturing skill, and continuous operational improvement. We believe our platform and track record continues to set the standard. Leadership in the field is one of the many things that gives us confidence in the long opportunity Our investments aren tied to one product cycle They strengthening the foundation for everything we build next That how we think about creating long value We do not optimize for a single quarter. We focus on building a stronger company every quarter.

On slide 13, another tangible example of continued improvement leading to a specific Last quarter, I talked about an early access launch of our complex genes offering, extending the range of DNA sequences researchers can order from Twist.

Complex genes are highly challenging constructs that have historically been out of reach for most platforms to synthesize consistently because of high GC content, repetitive elements, or other complex characteristics. Today, we manufacture these sequences with the same automation, the same manufacturing line as part of our standard and express gene production workflow with the consistent speed, scale, and quality customers expect from Twist.

Early customer adoption has been very encouraging. During early access, we've worked with a select handful of customers who've ordered more than 1,800 complex genes across well over 100 orders, and the execution has been superb. We've completed the overwhelming majority of these highly complex constructs in 12 days within our expected delivery window. That matters because it's one thing to produce a complex sequence once in an R&D environment.

It's something entirely different to manufacture thousands of highly complex constructs repeatedly at commercial scale with consistent quality. While complex genes represent a relatively specialized market today, our execution demonstrates that we continue to expand the boundaries of what customers can manufacture on the Twist platform using the same highly automated production infrastructure. Each new capability increases the value of our platform, expands wallet share with existing customers, and further differentiates Twist from competitors. At Twist, we focus on automating and operationalizing any new product offering within our manufacturing workflow, so that what we can do for one customer, we can deliver for thousands of customers with consistent quality, speed, and precision at scale.

Two weeks ago, we launched our complex offering formally, expanding availability broadly across the market. In summary, we believe our silicon platform, automation, software, and manufacturing infrastructure uniquely positioned us to serve a wide range of customers across industries, creating a competitive moat that would be exceptionally difficult to replicate.

With that, I'll turn the call over to Adam to review our financial results.

Thank you, Patty. Turning to slide 14, Q3 was another quarter of consistent execution against the financial model we've laid out. Revenue grew 23% year-over-year to $118.4 million, our 14th consecutive quarter of sequential growth. We focused on growing the top line while maintaining our commitment to adjusted EBITDA break-even for the fourth quarter of fiscal 2026, and we understand that growth of 20% or more significantly differentiates twist among our peers. Gross margin was 52.8%, growth of 120 basis points sequentially, with 70% of incremental revenue dropping to the gross margin line.

Let me walk you through the details. On slide 15, you'll see DNA synthesis and protein solutions revenue increased to $56.6 million compared to $40.8 million in the third quarter of fiscal 25. Growth of 39% year-over-year at 6% sequentially. We shipped 369,000 genes in the third quarter, plus consecutive quarter-over-quarter growth in genes manufactured for data characterization.

On slide 16, we show NGS applications revenue for the third quarter grew to approximately $61.8 million, compared to $55.3 million in the third quarter of fiscal 2025, an increase of 12% year-over-year For the quarter, revenue from our top 10 NGS applications customers accounted for approximately 48% of NGS applications revenue.

We served 657 NGS applications customers in the quarter, with 182 having adopted our products. Looking geographically on slide 17, America's revenue increased to approximately $77.3 million in the third quarter. On slide 18, looking at revenue by industry. Therapeutic revenue was $40.4 million for the third quarter of 2026, compared to $27 million in the same period of fiscal 25, a growth of 49%, reflecting the increased uptake of our products by pharma, dry lab biotech, and large tech companies in their efforts on therapeutic discovery and including AI-enabled drug discovery. Diagnostics revenue was $43.8 million in the third quarter of 2026, compared to $38.1 million in the same period of fiscal 2025, an increase of 15%. Diagnostics revenue grew 10% sequentially based on strong growth from top accounts.

Industry and applied revenue were $5.7 million in the third quarter of 2026, compared to $6.1 million in the same period of fiscal 2025. Academic and government revenue were $15.5 million in the third quarter of fiscal 26, an increase of 32% year-over-year and 21% sequentially, driven by strength in U. S. accounts where we saw several large customers return during the quarter. The environment remains dynamic, and order patterns may fluctuate, but importantly, our outperformance this quarter for academics and government demonstrates the resilience of our business, the depth of our customer engagement, and the growth of this customer group.

Global supply partner revenue was $12.9 million in the third quarter of 2026, compared to $13 million in the same period of fiscal 2025. This revenue stream continues to provide a stable, reoccurring revenue base, while our faster-growing therapeutics and diagnostics product groups drive overall company growth. Moving down the P&L to slide 19, you'll see our key financial metrics. Our gross margin for the third quarter was 52.8%, up sequentially and driven by strong revenue growth, even as we continue to make deliberate investments in new product offerings and manufacturing capacity that we expect to result in future margin gains as we accelerate growth and implement continuous process improvements. Operating expenses excluding cost of revenues were $98.7 million for the quarter, compared to $81.4 million in the prior year, which includes approximately $2 million in employee transition costs, as well as other one-time expenses that will result in more than $5 million reduction in OPEX in the fourth quarter.

Looking at our progress and our path to profitability and progress towards break-even on slide 20. For the third quarter of fiscal 2026, adjusted EBITDA was a loss of approximately $11.3 million, reflecting planned one-time investment. We ended Q3 with $166.8 million in cash, cash equivalent in short-term investments, versus $171.7 million as of March 31, 2026. On slide 21, turning to guidance. For fiscal 26, we are increasing our revenue guidance and now expect total revenue of $456 million to $457 million, up $12 million at the midpoint, representing growth of approximately 21% year over year. In the third quarter, total revenue growth reflected above 20%. Based on customer demand, our current funnel and order growth, we expect momentum to continue and look forward to sharing full-year guidance for fiscal 27 in November.

For Q4 of fiscal 2026, we expect total revenue of $123 to $124 million, growth of approximately 25% year-over-year at the midpoint. We expect sequential growth from both DSPS and NGS. We expect ESPS sequential growth to be driven by therapeutics and NGS to return to growth above 20% year-over-year. Well into our final quarter of the fiscal year, we remain confident in our trajectory and continue to expect to achieve adjusted EBITDA breakeven this quarter. Our focus is now on sustaining that performance and continuing to execute against long-term financial objectives throughout fiscal 2027.

With that, I'll turn the call back to Emily.

Thank you Adam. I'd like to leave you with one final thought. When Twist was founded more than 13 years ago, our goal wasn't simply to build a better way to synthesize DNA. It was to remove biops that slow scientific discovery. That vision is working. Today, our platform is enabling advances across cancer diagnostic, AI-enabled drug discovery, synthetic biology, and academic research. We have translated innovation into durable business performance, delivering 14 consecutive quarters of revenue growth, expanding growth margin, and remaining on track to achieve adjusted beta break-even this quarter.

And yet, I believe we are still in the early chapters. Biology is becoming increasingly digital, data-driven, and AI-enabled. Scientists are asking bigger questions, designing more complex molecules, and moving faster than ever before. Those trends play directly to twist strengths and reinforce our confidence that the opportunity ahead is substantially larger than the one we set out to address 13 years ago. Importantly, we continue to execute against our plan to deliver sustainable, profitable growth. As we look ahead, we are confident not only because of the opportunities in front of us, but because of the foundation we have built to capture them. And we continue to see multiple durable drivers of growth, as you'll see on slide 22.

The high-enabled drug discovery continues to expand. Molecular residual disease continues to grow in application, with the reimbursement environment expanding. We see opportunity to introduce proprietary enzymes in our workflows and our internal processes to optimize performance and cost, as well as reduce our dependence on suppliers. And in the longer term, we believe nucleic acid therapeutics provides a personalized diagnostic and therapeutic approach that will improve patient outcomes and positively impact the healthcare system. With the growth across the market we serve expanding, our serviceable addressable market is projected to be $13 billion by 2030. In addition, our innovation engine will continue introducing new capabilities that we haven't mentioned here today, expanding that upside opportunity. On slide 24, you will see that we feel confident in our ability to drive continued growth moving forward.

Specifically, we have just delivered our 14th consecutive quarter of revenue growth at 23% growth year-over-year. We believe we have a strong growth trajectory to more than double revenue from organic growth in 2021. We guided $123 to $124 million for the first quarter of fiscal 2026, gross of approximately 25% year-over-year. Based on customer demand, our current funnel and order growth, we expect momentum to continue. We expect to meet or exceed our guidance of triple-digit percent order growth for AI-enabled drug discovery in fiscal 2026. Based on our robust funnel, we expect to again deliver triple digit percent growth for orders from AI enabled drug discovery in fiscal 2027. We expect gross margin above 52% for fiscal 2026 with a goal of margins of more than 60% as the business matures.

We expect to achieve adjusted Vita break-in for the first quarter of fiscal 2026, and we expect to maintain this commitment for fiscal 2027. And we will continue to meet our customers where they are, enabling them to truly change the world for the better. At this time, let's open the call for questions.

Thank you, Brandon. We are very excited about this quarter. We are seeing a lot of strength from existing customers as well as new customers coming in. Obviously, we had a growth of more than 20%, and we are guiding a growth of more than 20%, actually almost 25% for people. So things are going really well. In AI, in particular, there are a few things happening.

First, customers that have built their models are turning the crank. And then we are seeing new customers coming on top of that. And then even the existing customers that have been turning the crank now are trying to look at new modalities. So, you might have people coming in with just a VHH and then expanding to full IDG. And people are not quite broadly talking about AI for Biccific, but we know it's done. So talking to customers looking at the quotes we are giving them the number of sequences that they have Keep in mind that they want to build either as full DNA or as array DNA gives us very very strong confidence that the triple percentage goals that we see in AI discovery and we know we going to be able to deliver at We see it continuing, again, from the presentation.

Thanks, Poudin, for the great question. The number of genes is growing massively, which is great, right? I think for us we can process them easily on our automated systems and we have a hard time to absorb that kind of provenance. So the therapeutic business rules 49% year over year, so very much in line with the growth of genes. It's correct that the STF quote-unquote only groups 36%. I think that as the volume growth comes primarily from antibody-type sequences, as you know those sequences are shorter than maybe plant genes. And so as we see the growth coming primarily from human therapeutics, there is a shift to smaller genes, which is a very safe time with us.

But the key is AI is doing exactly what we thought it would do. It just creates more sequences. And the test of that I mentioned is that biology is becoming more digital, more data-driven, and more AI-enabled. And that just brings more demand for more end, more frequency, and we're absolutely seeing it in our data. Adam, do you want to take the second question?

No, absolutely. So thanks for the question, Vinit. In terms of order to revenue recognition, we're noticing, particularly with AI drug discovery, that the timeline for projects are usually measured in weeks. So at the end of last year, when we had a pretty significant order step up towards the end of the fiscal year, we saw there was some separation there. But as we go into 26 and look towards 27, the two metrics converge pretty nicely. The other question in terms of adjusted EBITDA and the path and the bridge to Q4 and beyond. No, great question, and we've been very disciplined over the last number of years with how we've managed the business and our investments, and we continue to do so.

And so, as we look into Q4, we had the one-timers associated with some of the employee transitions in Q3, as well as some continued investment in our new digital capabilities that we've here launched in Q4. So, we expect to see sequential improvements in the OpEx moving forward starting in Q4, so that we see the path to the Justineva. positive in Q4 and then being able to continue to make progress on that in 27 and beyond.

Thanks David, great to have you. Thanks for initiating and for your first double question. I'll start to Adam for your first one on the just a bit of momentum and then Patty for the new perk in NTS.

David, great to hear you on the call. In terms of our commitment, we said we're going to give full year guidance in November, and we plan to give a robust outlook. We're not in the business typically of going backwards, that being said. And so, you know, we look at our full year adjusted EBITDA this year, improving year on year to being positive for the year. And we look to make sequential improvements wherever possible. We also recognize we love our employees and give them a raise at the beginning of every fiscal year. So we're going to balance that. We'll give a full guidance as we approach November. And then also in terms of how we look at the business long term, very positive progress on both the growth trajectory as well as the commitment on continued progress.

Dave, just building off, just coming over to your questions on products and NGS space. And from a workflow standpoint, it's a good time just as a reminder how we've built out some really well differentiated enzymes using AI-driven discovery and development methods. And they're critical in whole genome and other workflows is high-performing ligase and high-satellite, high-performing glimmery, both of which are featuring in our kits, which are benchmarking incredibly well, both internally and in our customers' hands. So that's a long-term commitment to enhance our customers' success in their experiments, and it's going to be an ongoing drive into the market.

And if I move across into the emerging applications that we're excited about, I'll just call out MRD, again, from Lecular Residual Disease. Obviously, we have workflows for any approach, but in particular, maybe just spend 30 seconds on the tumor-informed platform. And what you're seeing there, obviously, is a correlation between increasing probe count derived from knowledge gains from sequencing the patient's tumor, leading to higher sensitivity tests and therefore better patient outcomes.

And we see demand continue to increase. And if I just go way, way back to talking about something like our current capacity for something like 32 million oligos per day, If you can imagine a situation of hundreds of thousands to millions of tests in the future, all demanding thousands of probes, tumor informed, delivered to a patient in, or sorry, delivered to a service lab or to a hostel or wherever a customer is in a very, very short period of time. And by that, I mean, you know, a couple of days max. And we're pretty excited about where that segment's going. It's another beautiful application of our synthesis platform.

Thank you, Subbu. Yes, you got that right. In terms of long-term growth, I think that overall the trends are in our favor. I did just mention the trends in MRD where I will fully repeat this comment. Basically, what we're hearing is for high-standing PTC, People want more problems. And in order to be able to fit their window for the therapeutic, it needs to be delivered fast. So, specifically what we feel is the speed of delivering thousands of probes with another experiment. We think that that trend there is going to be a very strong sales in our win. In terms of AI discovery, it's just incredible. The business is kicking through all the cylinders. Last year, a year ago, was a big order in the SPS, and now the rigorous model.

Really, we've seen a change in the order platform. We are asking just big, chunky orders, and then speaking to customers in what they need going forward. We've heard about the model for AI bots needing more and more data points. The same for AI to score. There's a growing number of data points that are needed, and we can feel that hunger for data points. We deliver high throughputs, extended expression and characterization. And so we are going to prepare the market. Overall, we are not guiding to 2027, but before we are guiding to a very strong Q4, We are guiding to a fiscal 26 years above 20% growth. We are guiding to just a little bit of a regular in Q4, and we couldn't be more excited about what's going on.

Again, the Twist platform is really meeting the moment of what our customers need, both on the MGS and the D&S and the D&S solution.

Yeah. Thanks, Kyle, for initiating and the question. Yeah, 49% growth, quarter by quarter is outstanding. We are raising the guy by $12 million, which is three times the beat. So obviously there's a lot of confidence. Maybe I'll step back to one sentence that Ali said in his remarks, which is that we do not optimize sourcing a quarter. Instead, what we're doing is we are focusing on building a stronger company every quarter. So we have our eyes firmly looking ahead. Frankly, not worried about competition at all. The kinds of numbers in terms of thousands of frequencies that people need in an array format, or the millions that people need in a crude format, I don't know if there is any other platform that I3 can deliver that kind of number.

So for us, we're not really worried about competition. It's about being there for customers, hearing what they need, and meeting their faster data point target. And we think we doing pretty really well and as people start to expand to new modalities again a lot of the AI so far has been done for GHH our agency IGGs As people are going to new modalities, as more, I guess we know that maybe a year ago, we are on the sideline now, we are really engaged. We will not guide to a triple digit growth on the air hydro discovery for 2027. Again, after the end of the week, we will be able to do a very strong signal forecast.

So, please be ahead.

Thank you, Matt. The growth for next year is anticipated to be very broad-based. We are actually adding capacity now ahead of the demand in the data characterization. As you know, the The capacity that we have on the DNA synthesis and protein expression is really outstanding and ahead of what people need. And so we know that the data piece is very exciting about customers. They don't have to be the lab. They don't have to worry about maintenance, about calibration, about machine-to-machine reproducibility. We take care of all of that. So being able to have a one-stop shop where you give sequences, thousands of sequences, and the target that you're interested in, and being able to get data is very appealing.

At the same time, we are a custom business. Our customers want different things, different blend of text, different conditions, different buffers, different pollution. And so our platform is built for that as well. So to your question in terms of where will the growth come from, frankly, it doesn't really matter. We don't really care. We will be there for wherever the science takes our customers. At the same time, we anticipate that a lot of it will come from the data site.

Thanks for the question. So, in terms of the guide for Q4, we are expecting sequential growth, both DSPS and NGS applications. We continue to see both strength continuing in the diagnostic space sequentially as well as in the therapeutics, often driven by the AI drug discovery. As we look at that strength continuing, it's really a sediment to the pipeline about opportunities we see. We see growth both in terms of the new customers coming in as well as in the repeat business across the DSPS and the Azure Discovery space.

Yeah, that's a great comment. It's true that you're 100% correct that in the past we talked to some companies and they will send us some sequences and we will ship them very quickly, we get paid, and we didn't always have visibility as to when the next batch would be. I think for AI, it's a little bit different because now we're talking about very, very big numbers. Now we have all the from the DNA synthesis and protein solution side that's similar from what we're getting in the NGS side. And when you're thinking about a big number of millions of dollars, and now you need an MSA, and there's some discussion up front of what do they need, and it's more our customers making sure that, convincing themselves that we have the capacity to do.

And so they are a lot more transparent in what they need. And then when the orders come in, again, those are our big numbers. There's a lot more engagement and transparency on their side with what they're going to do with it, what the next batch is coming in. And so in some ways we have been much more engaged in the science of what our customers are doing than we were before where we were quote unquote just a DNA provider or just a sequence provider. And now, you know, we will move to the next level of providing a solution. And they're talking to our CSO, you know, with a drug discoverer, right? And so it's a much higher level of engagement.

And that's why we have more visibility than we had before.

I'll start and then I'll pass the question to Adam on the financial question. We don't worry too much over the competition, frankly. We try to hear what customers want and then do that. At the same time, having a healthy panorama and looking over the shoulder is important. I think in this case, We started as a DNA company and we didn't have a big presence in protein. Through the engagement with customers, we understood that they needed protein and data. And so over the last 18 months, we built something that we think is really unique. And in some ways, we are leaping ahead of GeneScript because we don't believe they have the same data capacity and capabilities as we are.

So in some ways, we are the descriptors, not the other way around. Cuberthure has been around for a long time, and frankly our customers don't care what kind of ture you need, you use. They want to know what data capability we have, what capacity we have, and what speed we can deliver that data. And so, it's not the differentiation, it's not around the truth that you're using, the differentiation around the breadth of the menu, the flexibility in the condition that those that are said are And then, very importantly, the N. How many sequence can I test? If you're talking about millions of data forms in a pooled assay, I think we are unbeatable there. If you're talking about tens of thousands of sequences in an average format, I think we're also pretty invisible.

If you want five, ten sequences, you may have a choice of supplier, but for large numbers, I think we're in a very, very good position.

Adam? Yeah, Luke, thanks for the question. In terms of AI orders and revenue, I hit on it earlier, But if you looked back a year ago at this time, in Q4 of 2025, we had a record order from an AI drug discovery project that really made the cutover at the end of the fiscal year. Some of that order dripped into revenue recognition into Q1 fiscal of 26.

Looking at 26, the timelines are much more lined up, just that the progress has been smoother, and we've had a broader base of customers upon which to grow on. And we're seeing that the orders and the revenue are much more lined up with each other. Although we haven't given specific breakouts for AI drug discovery quarter and quarter, I point everybody to the progress in therapeutics and really the outside growth in therapeutics primarily being driven by AI drug discovery. So looking forward into 27 and beyond, we'd expect the revenue and the orders to be more lined up like they are in 26.

Yeah, good question. Thanks for that. Yeah, the academic segment, good quarter team executed well. It remains a dynamic environment and will continue to execute well into that segment. Our value proposition continues to resonate. You imagine a budget constrained environment, cost, speed, quality, essentially more shots on your budget and resonates well. It's something that we've underserved, really, the history of Twist.

And Express Gines and Promotions into the segment continues, and we've just focused on, like all of our customers, delivering a really fantastic customer experience. Once you're on the platform, you're not going to go back to pay more or slower products. We'll continue to execute day by day, and we'll look to continue our strength in that segment.

Thank you for your question. The story this quarter is simple. Customer demand continues to strengthen. Our execution continues to deliver. And the platform we've built over the more than 10 years that we've been doing this is creating an advantage that continues to widen. We remain confident in our trajectory and excited about the opportunities ahead. Thank you.