MaxCyte, Inc. (NASDAQ:MXCT) Q1 2025 Earnings Call Transcript

MaxCyte, Inc. (NASDAQ:MXCT) Q1 2025 Earnings Call Transcript May 10, 2025

Operator: Good day and thank you for standing by. Welcome to the MaxCyte First Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker’s presentation, there will be a question and answer session. [Operator Instructions]. Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your first speaker today, Eric Abdel, Investor Relations. Please go ahead.

Eric Abdel: Good afternoon, everyone. Thank you for participating in today’s conference call. Joining me on the call from MaxCyte, we have Maher Masoud, President and Chief Executive Officer, and Douglas Swirsky, Chief Financial Officer. Earlier today, MaxCyte released financial results for the first quarter ended March 31, 2025. A copy of the press release is available on the company’s website. Before we begin, I need to read the following statement. Statements or comments made during this call may be forward-looking statements within the meaning of federal security laws. Any statements contained in this call that relate to expectations or predictions of future events, results, or performance are forward-looking statements.

Actual results may differ materially from those expressed or implied in any forward-looking statements due to a variety of factors, which are discussed in detail in our SEC filings, except as required by applicable law, the company has no obligation to publicly update any forward-looking statements, whether because of new information, future events, or otherwise. And with that, I will turn the call over to Maher.

Maher Masoud: Thank you, Eric. Good afternoon, everyone, and thank you for joining MaxCyte’s first quarter 2025 earnings call. Before discussing our business performance, I would like to take a little time to discuss the current environment. It’s obvious the macro backdrop has become more dynamic since the start of the year, with headlines emerging that can have an effect on our industry and the lifelines of space as a whole. As stated in our release, we had a strong first quarter and remain confident in operational focus and underlying business. However, we are aware of and adapting to macro uncertainties that could affect our business. As to the new tariff policies, as it stands today, we see limited impact on our gross margins in U.S. revenue.

All of our manufacturing is in the U.S., and more than two-thirds of our revenue is from the U.S. We could potentially have greater exposure in Europe and Asia in the event of tariff retaliation, but we have mitigated tariff impacts in 2025 by leveraging our global distribution network where appropriate. It is the management team’s job to navigate through this more challenging environment, and we remain focused on executing our growth plan for 2025 and beyond. Jumping into the first quarter, MaxCyte reported $10.4 million in total revenue, which included strong core revenue of $8.2 million and SPL program revenue of $2.1 million. We were pleased with the business performance to start the year, which was in line with our expectations. The quarter was highlighted by continued demand for our expert platform, strong execution from our sales team, and successful progress integrating SeQure DX.

We have begun 2025 as a more agile and focused company than ever before, which is allowing us to adapt to the dynamic macro backdrop so far this year. Throughout 2024, we conducted a bottom-up review of MaxCyte to optimize new product development, manufacturing, commercial execution, and capital allocation initiatives. The streamlining of the business resulted in some workforce changes, including a reduction in inefficiencies and the addition of key personnel. These changes across MaxCyte have improved accountability and better aligned resources with the company’s long-term goals. We have reduced our operating expenses and cash burn, while we also increased our product offerings, best positioning the company to achieve profitability with our existing balance sheet.

As stated earlier, the operating environment for our customers continues to be challenged, particularly as the macro environment has become increasingly dynamic since the beginning of the year. Customers have become more hesitant in capital equipment purchasing decisions over the last few months, with a few customers reallocating R&D spend to prioritize certain programs over others. That said, we still expect to execute against a pipeline of instrument opportunities in our plan this year. Our team has adapted well to the evolving environment so far this year, and we are confident that our operational focus and highly differentiated offerings will allow us to deliver against our 2025 guidance, which we have reaffirmed today. To summarize the core business results for the first quarter, the instrument installed base grew to 787 as of March 31st, with instrument revenue of $1.4 million.

License revenue was stable quarter-over-quarter and year-over-year at $2.5 million, demonstrating strength from SPLs as they progressed to the clinic. And we were pleased with the continuation of strong PA demand as PA revenue grew 13% year-over-year, driven by activity from early stage and clinical customers. Lastly, we have seen solid initial traction with SeQure Dx in the first few months we have owned the company, and remain on track to deliver at least $2 million in SeQure Dx revenue for the year. Stepping back, despite a difficult market environment over the near term, we remain very optimistic about the cell and gene therapy market, and associated trends that MaxCyte for platform helps to address. Non-viral cell therapy continues to move towards engineering approaches that involve more complex therapies across an expanding variety of cell and disease types.

Additionally, cell and gene therapy developers and regulators are placing an increasing emphasis on safety. MaxCyte solutions, including SeQure Dx is incredibly well positioned to support these trends. As discussed on the last course call, the SeQure Dx services platform provides developers with safety assessment of their therapy earlier in the discovery process through on and off target gene editing assessments, which provides a range of benefits for programs. With the addition of SeQure Dx to MaxCyte, we can now provide ex vivo and in vivo solutions to both cell therapy and gene therapy customers. The integration of SeQure Dx is going very smoothly. Customers have been receptive and interested in the SeQure Dx offerings. We are seeing strong synergies in leveraging our sales and marketing teams, and we have added tremendous talent, expertise, and drug safety assessment with the SeQure Dx team.

Over time, we believe that gene editing assessments will continue becoming increasingly important and eventually essential to cell and gene therapy development programs and their safety profiles. Turning to our SPLs, we continue to support our existing clients as they progress their programs through the clinic and strengthen our expanding portfolio. In the first quarter of 2025, we signed TG Therapeutics. We entered into an agreement with Precision Biosciences to acquire our license to AsiaCell, bringing our total number of active SPLs to 29. We continue to see a robust pipeline of SPL opportunities ahead of us, and expect to sign SPLs at our historical rate of three to five per year in 2025. MaxCyte’s skill set of commercial and field application scientists, regulatory support with an accessible FDA master file, and differentiated electroporation technology with superior results, differentiates our offering and allows us to continue to capture meaningful economics in our SPL agreements.

In the quarter, SPL program-related revenue was $2.1 million, including milestone revenue and revenue that came from CASGEVY commercial royalties. During Vertex’s first quarter earnings call just a couple of days ago, the company indicated that there are now 90 patients who completed cell collection, up from approximately 50 patients stated in their fourth quarter 2024 earnings call. Further, more than twice that number of patients, so more than 180 patients, have been referred by physicians to activated treatment centers to initiate the treatment process, with many centers having collected cells from multiple patients. The company indicated that interest in CASGEVY continues to be incredibly high in the sicker cell disease and beta thalassemia patient and physician communities globally.

An uptake is accelerating as access and reimbursement are secured, and familiarity with the process for collecting cells and infusing this truly transformative treatment grows. Vertex indicated eight patients have received their infusion of CASGEVY edited cells in Q1 and reiterated that they believe CASGEVY has the potential to be a multibillion-dollar product for Vertex. As we look ahead, the future potential programs we are supporting in the clinic continues to grow as we add SPLs. There are eight potential approved therapies in 2027 and 2028 supported on MaxCyte, and an additional potential 12 approved programs from 2029 to 2031. As the management team, we will maintain an operational rigor in 2025 and beyond, continuously evaluating ways to be more efficient while ensuring we prioritize investments in areas of high growth.

This will include ongoing organic investments in the company, along with inorganic investments and external opportunities, such as SeQure Dx. Our management team, in collaboration with our board, always strategically assesses capital allocation initiatives that offer superior returns for MaxCyte and our shareholders. Organically, we are very confident in the processes and roadmaps we have put in place to drive growth. Inorganically, we strive to broaden our offerings to solve critical pain points in cell and gene therapy development. In both cases, we carefully manage our financial health and are very selective with capital allocation decisions. All in all, we are committed to deploying capital to drive value for shareholders over the long term.

I would like to take a moment to talk about the anticipated delisting from the AIM Markets. In April, we announced that MaxCyte is seeking shareholder approval to delist from the AIM and maintain a single listing on NASDAQ at our annual meeting of stockholders, which will be held on June 18th. As we have stated, the company and board believe that it is no longer in the best interest of MaxCyte or its shareholders to continue to trade on AIM. I want to emphasize, however, that we are thankful to our UK-based shareholders for their support and belief in our long-term vision, and we will continue to engage with and request support from our UK shareholders in future years. We will provide an update following the AGM. To close, we are pleased with our first quarter results and the progress that we have made so far this year.

We are navigating a dynamic and evolving macro environment and remain on track to deliver on our 2025 goals. We are optimistic about long-term opportunity in the industry and for MaxCyte as a premier cell engineering platform. With that, I will now turn the call to Doug to discuss our financial results. Doug?

Doug Swirsky: Thank you, Maher. Total revenue in the first quarter of 2025 was $10.4 million compared to $11.3 million in the first quarter of 2024, representing an 8% decline. Our milestone revenue remains lumpy from quarter-to-quarter, which can substantially impact year-over-year comparisons in total reported revenue. We reported core revenue of $8.2 million compared to $8.2 million in the comparable prior year quarter, which, absent rounding, represents approximately an increase of 1%. Within core revenue, instrument revenue was $1.4 million compared to $1.9 million in the first quarter of 2024. License revenue was $2.5 million compared to $2.6 million in the first quarter of 2024. And processing assembly for PA revenue was $3.9 million compared to $3.4 million in the first quarter of 2024.

Assay service revenue, which includes SeQure Dx, was $0.1 million in the first quarter of 2025, including approximately two months of revenue recognized in the quarter following the acquisition in January. Other revenue was $0.3 million compared to $0.2 million in the first quarter of 2024. Instrument revenue in the first quarter of 2025 was negatively impacted by a difficult operating environment experienced by our customers, leading to cautious capital spending. License revenue remained stable, while PA revenue continued to demonstrate strength. Of note, 57% of our core revenue is derived from SPL customers in the first quarter of 2025, which compares to 53% in the first quarter of 2024. The percentage of core business revenue from SPLs continues to demonstrate a healthy balance of early-stage to clinical-stage customers.

We recognize $2.1 million of SPL program-related revenue in the first quarter of 2025, compared to $3.2 million in the first quarter of 2024. This includes milestone revenue from SPLs advancing programs through the clinic and royalty revenue from sales of CASGEVY. Moving down the P&L, gross margin was 86% in the first quarter of 2025, compared to 88% in the first quarter of the prior year. Excluding inventory provisions and SPL program-related revenue, non-GAAP adjusted gross margin was 83% in the first quarter of 2025, compared to non-GAAP adjusted gross margin of 83% in the first quarter of 2024. Total operating expenses for the first quarter of 2025 were $21.2 million, compared to $22.2 million in the first quarter of 2024. As Maher discussed, MaxCyte is constantly evaluating the ways in which we can enhance operational efficiency, and we remain focused on making targeted investments to drive long-term returns.

We finished the first quarter with combined total cash equivalents and investments of $174.7 million, and no debt. Continuing to our 2025 guidance, we are reiterating core revenue growth of 8% to 15%, compared to 2024, inclusive of revenue from SeQure Dx, which we expect to be at least $2 million for the full year. Customer interest is very strong for SeQure Dx, but we expect this revenue to be weighted more to the second half of the year. We are very confident in our 2025 revenue guidance for this business. Our core revenue outlook assumes that the current operating environment experienced by our customers does not materially change for the better or worse. We are closely monitoring the environment through discussions with our customers and are confident that we will continue to execute our plan this year.

Additionally, we are reiterating SPL program-related revenue guidance, which is expected to be approximately $5 million in 2025, and which includes both expected revenue from pre-commercial milestones and commercial royalties and sales-based payments. We will not break out the components of SPL program-related revenue due to confidentiality agreements with our customers. We would like to note that our SPL program-related revenue outlook is a risk-adjusted forecast that is achievable under a variety of potential outcomes across our SPLs and the planned clinical progress and commercial success of our customers. Lastly, MaxCyte remains in a strong financial position and continues to expect to end 2025 with approximately $160 million in cash equivalents and investments on our balance sheet.

This guidance incorporates cash paid for SeQure Dx in January in addition to other transaction-related expenses. Due to operational improvements to MaxCyte since the beginning of 2024, we believe the operating cash burn profile of MaxCyte has decreased relative to prior years without sacrificing investments that we expect to drive growth. To close, MaxCyte remains positioned to execute on our 2025 outlook. We remain committed to operating efficiently and spending diligently throughout the year to best support our customers and deliver long-term value to our shareholders. Now, I’ll turn the call back over to Maher.

Maher Masoud: Thank you, Doug. We are pleased with the financial results and progress that we have made so far in the year, including integrating SeQure Dx and executing commercially and operationally. I want to thank everyone at MaxCyte for their hard work and dedication for providing the highest quality of offerings to customers. With that, I will turn the call back over to the operator for Q&A. Operator?

Q&A Session

Operator: Thank you. At this time, we will conduct the question-and-answer session. [Operator Instructions]. Our first question comes from Matt Larew with William Blair. Your line is now open.

Matt Larew: Hi. Good afternoon. You spoke a little about the sort of more recent introductions of a certainty into the macro environment, largely sort of on the geopolitical and funding categories. What about from a regulatory standpoint, there’s been a number of FDA leadership, guideline, and personnel changes over the last three months. I’m just curious your take on that as well as what you’re hearing from customers about potential upsides or downsides based on what’s come out so far?

Maher Masoud: Yes, absolutely. Great question, Matt, nice to hear from you again. Let me take that on. So obviously, it’s a little bit early right now to tell the outcomes from any regulatory risk or changes. We’re not hearing anything from customers that they feel as though the changes at both the FDA Commissioner with Dr. McCarrie as well as with the new CBRE head, Dr. Prasad, that there’s any changes there that could impact the future of potential regulatory hurdles that could come about. We’re not hearing any of that. The long-term health of our business is intact. The value proposition for cell and gene therapies, I think, is just as strong today with those changes as they were in the past. We’re not seeing any modifications or slowing of progress from our customers, And then a few things as well.

I mean, the industry as a whole, the cell and gene therapy industry, which is what I’ve been saying repeatedly is the path of the future for medicine and really procurative medicine. ARM, Alliance for Regenerative Medicine, has been putting out a note as well where they have talked about exactly these changes at the FDA Commissioner and as well as with the new CBRE head. And a few things worth highlighting, Matt, which is if you look at Dr. McCarrie’s position, he’s mentioned, he’s focused on cures and meaningful treatments, meaningful treatments for diseases that have not been treated before, as well as he supports new regulatory pathways for rare diseases. So you see the positivity as well from the new FDA Commissioner. And one thing I want to highlight as well, just to indicate, this aligns with what Secretary Robert F.

Kennedy has indicated in the past. In fact, a few days ago, he came out and there was, from HHS, there was a CMS, there was a video talking about the CMS pilot program on sickle cell disease specifically, where RFK actually mentioned life-changing gene therapies and transformative diseases for sickle cell disease. So I think we see this as just a continuation of why the cell and gene therapy space is at the forefront of medicine. We don’t foresee any regulatory risk. We’re not seeing anything from our customers in terms of any regulatory hurdles. And we look forward to continuing dialogue with the FDA Commissioner as well as the head of CBRE when we have a chance. We see this as a continuation of the great progress that cell and gene therapies have made.

Matt Larew: Okay, great. And then just one for Doug. Obviously, you had announced the RF and operational review at the end of December. And I just want to get a sense for how much of those effects were realized in the quarter versus what anything incremental we might see from a cost containment standpoint throughout the year. And then just in terms of the delisting, if there’s any way you can give a sense for the cost you’re incurring today with respect to maintaining dual listings that you would not have to incur if you moved to the sole listing?

Doug Swirsky: So let’s take it in reverse order. With respect to the AIM listing, if we’re successful there, I think the savings will be the magnitude of several hundred thousand dollars for the year and that will be for every year. So we think that would be good dollars to recapture. In terms of savings from the reduction we’ve done, I think we’ve begun to realize those. Obviously, personnel costs get recognized sooner than they’re paid out. And so from a cash flow point of view, a lot of that was in this quarter. But I think if you look at the cash position of the company in general, if you look at where we’ve been spending money, they don’t know net of, and we’ll disclose this, it was almost a million dollars worth of transaction-related expenses for the SeQure transaction that shows up in our financials in terms of expenses.

If you net that stuff out, I think we’re showing a clear trend towards better control over spending, but can’t quantify exactly how much of the cost savings. We’re not thinking about it that way. Some of these have been reinvested. I think in general, when you take away the strategic items that we’ve worked on as manifested by the SeQure acquisition, the trends on expenses are good.

Matt Larew: Okay, thank you.

Operator: Thank you.

Maher Masoud: Thanks, Matt.

Operator: Our next question comes from Julie Simmonds with Panmure Liberum. Your line is now open.

Julie Simmonds: Thank you. Hi, guys. Just a couple of questions from me. Firstly, on the operating environment generally, clearly you’ve touched on the regulatory side. I was just wondering whether there was anything specific that you’re seeing, either in sort of funding or changing strategies from your customers that’s worth talking about, aside from the regulatory bit?

Maher Masoud: Yes, absolutely, Julie. So one thing I think we want to highlight is, we are seeing some constraint on the CapEx spending. That is where we are right now. Nothing that is in any way worrisome, nothing that concerns us in terms of the yearly guidance. In fact, we’ve done a review of all of our for-the-year instrument sales, and we feel confident in the guidance for the year and executing against the funnel on the pipeline that we have. But we are seeing some hesitation in terms of larger CapEx spent from our customers. In terms of rationalization, we saw from one of our SPL clients and customers as well, where you saw Caribou came out and indicated that for their CB10 trial, they’re going to rationalize their program to really focus on B-cell malignancies versus also going after the same CB10 for lupus indication.

But that’s part of our business, Julie, and that’s in essence what we’ve talked about in terms of we expect some customers to rationalize in this type of funding environment. And it’s expected. It’s actually part of the guidance that we set for the year, knowing that we’re going to have this rationalization that we had last year and probably this year as well. So nothing really noteworthy, but we are seeing some cautiousness in CapEx spending that we expected and that we’re not seeing an increase of it, but just something we’ve seen since that’s probably a little bit of a difference from the beginning of the year.

Julie Simmonds: Lovely, thank you. And is that causing you any sort of pricing pressure on either instrument sales or across all the negotiations of SPL?

Doug Swirsky: So I think on pricing, if you look at our margins, we’ve held up, our non-GAAP adjusted gross margins are 83%. That’s what they were last time out. So I think we’re able to at least hold the pricing. It’s impacted by product mixes and you’re seeing sort of differences in terms of the mix of products that we’re selling, but I don’t think pricing pressure has been an issue.

Julie Simmonds: Lovely, thanks very much.

Maher Masoud: Yes, thank you, Julie.

Operator: Thank you. Our next question comes from Mark Massaro with BTIG. Your line is now open.

Mark Massaro: Hi, guys, thank you for taking the questions. I wanted to start with a question on your SeQure acquisition. It sounds like you’re doing a good job implementing or integrating it. I’m curious since this has an opportunity for you to expand, to work with in-vivo customers. Can you just maybe add some context to that? Obviously, your electroporation technology has been used for your ex-vivo folks. In what ways do you think SeQure can move you more into the fold in vivo and in which particular focus areas?

Maher Masoud: Yes, absolutely, Mark. Great question. So obviously, we are very excited about SeQure Dx. Let me reiterate that and indicate that the future for them this year and then the rest in the future years, we feel that we have an opportunity to really expand into the entire cell and gene therapy space. Right now, if you look where we are, we’re the premier technology for ex-vivo and non-viral gene editing. But now we have the chance and we’re doing it. SeQure Dx’s current customers and prospective customers are in the in-vivo space. And particularly, there’s two areas really that allows us to get into, which is not just those that are using AAV delivery, but also LMP delivery as well. That’s something that in the past, we’ve never had that ability to really enter into that customer base.

And now we can with SeQure Dx. But it does something else for us as well, Mark, which is I’ve talked about in the past, electroporation, LMPs, AAVs, they’re not just competing delivery systems, they’re also complementary. Oftentimes, you’ll see companies that are using LMPs for the knockout and using electroporation for the knock-in or vice versa, same thing sometimes with electroporation and AAV being complementary. This now allows us to work with those customers that are using those alternative delivery forms where it potentially can allow us to also capitalize on those complementary delivery customers as well. So really, it gets us into that space that we haven’t really been into before and allows us to work across the cell and gene therapy space for safety assessments, whether you’re doing AAV delivery, LMP delivery, or electroporation on an ex-vivo, doing gene editing safety assessments, knowing where the nomination confirmation sites are, especially now where there is more scrutiny on safety and ensuring that we have lifesaving therapies that have gone through the scientific rigor of the safety assessment, lets us plan the entire cell and gene therapy space.

And we’re excited about it, Mark. I hope that answers your question.

Mark Massaro: Yes, that’s super helpful. And then I wanted to follow up with a two-part question. I guess the SPL revenue for $2.1 million certainly came in above my expectations. I’m curious if it came in before your expectations as well, recognizing you have a full year guide for five, but I’m just wondering if the timing came in earlier. And then the second question is on sort of the makeup of the revenue drivers this year. You drove 13% growth in consumables, recognizing instruments are likely to remain under pressure this year. Do you see a similar trajectory of perhaps low double-digit growth in consumables steadily progressing throughout the year, or how should we think about that?

Maher Masoud: Yes, Doug, did you want to take that question?

Doug Swirsky: Yes, so in terms of the mix of revenue, let’s back up quickly, talk about SeQure. This is a new addition to the line items for core revenue. So we’ve got assay service revenue, which is now included with $142,000 for the quarter. We also do $30,000 of license revenue that’s now rolled into the licenses line of core revenue. So that’s what SeQure did for the quarter. Our view on that is we’re still confident that $2 million at least from that business this year, it’s less about the business ramping up, although that’s part of it, but it’s also about how we recognize revenue and in terms of recognizing you don’t want to find reports delivered. So there’s some revenue recognition timing issues there, but that business is off to a good start.

Terms of the mix, obviously instruments were a little down for the quarter, but we are paying very close attention to that. That is one of the key drivers of the forecast and looking out in the later quarters to assess our ability to get within the guidance we’ve provided. We feel comfortable with that in terms of what we can take away from the revenue mix within core revenue and extrapolate out that for the year. That’s tough to say. Obviously, license revenue is pretty stable. Usually we’ve talked about a couple of headlines that we faced in that area the last time that we’ve had an earnings call, but instruments is an area where we see an opportunity to drive growth from this point. This is a low point for us on instruments. That’s part of that was product mix.

We stole a lot of ATXs, for instance. It’s still a capital, people being very cautious with capital spending decisions, but we do feel good about the work that we’ve done to really understand the customer buying process and decision points and all the information that we have in our CRM. So we feel very good about the guidance in terms of the mix. You’re going to have to wait and see. We don’t obviously give guidance broken down by these areas. We certainly don’t give quarterly guidance as well, which sort of circles back to your first question, which is, were we surprised? We model out, if not the SPL, firm-related revenue. We really take a look at a variety of potential outcomes there and score when these things could occur, what’s the probability, and it’s a basket of things that sort of spits out a number that we’re comfortable with providing this guidance, whether it came earlier in the year or than expected.

I don’t know if that’s really the case. We really don’t break it out by quarter. There’s clearly some milestones in there, some milestones that we anticipated that would happen in 2025. There’s also obviously a component that’s for our royalties from CASGEVY. We just don’t break that out as well.

Mark Massaro: That’s helpful. Thanks, guys.

Maher Masoud: Yes, thanks, Mark.

Operator: [Operator Instructions] Our next question is from Brendan Smith with TD Cowen. Your line is now open.

Chad Wiatrowski: Hey, guys, this is Chad Wiatrowski on for Brendan Smith. Just given the priority to invest organically as you are, can we expect any new flow related to new products for product enhancements this year? And can you also just help paint the picture of what MaxCyte could look like in the next, say, three to five years as you continue to expand beyond electric operation? Thanks for the question.

Maher Masoud: Yes, absolutely. So, Chad, nice to hear it from you and great question. Obviously, we indicated last year some of the strategic initiatives that we took on and really removing some of the inefficiencies was meant to do a few things from, which is reduce our spending and ensure that we’re in line with the financial health that we always believe in, but then also to reinvest some of those savings into organic initiatives. So, yes, we do have a healthier bus product pipeline we’re working on and that we believe that we’ll have launch products this year. I can’t give, obviously, for competitive reasons what those products are, but we believe they’re meaningful products that allows us to expand the TAM for the space we’re in right now.

That really is complementary to our current electroporation technology and allows us to give our customers a complete workflow from early discovery all the way to the clinical commercial, which differentiates us from any other company which is we’re allowed. We have the ability to work with 29 SPL clients, the privilege of working with them. So, we’re working on products that allow us to really begin to truly increase our total addressable market to increase the SPLs as well. And we’ll have launch products this year within our current operating expenses and our current financial health. In terms of about the inorganic growth, we’re always looking at inorganic growth opportunities. I alluded to that on the call today. Along the lines of what we’ve done with SeQure Dx, as we see opportunities for us to grow in the cell and gene therapy space where we have highly differentiated products, but SeQure Dx offers us off-target gene editing, off-target assessments that no one else really out there can compete with, we’re always going to be looking for those type of opportunities to ensure that we can grow within the cell and gene therapy space, which we believe is the future of medicine.

Again, we’re always doing it in a very smart and thoughtful way, ensuring that our cash balance sheet is always at the forefront of where we are, and really ensuring that our profitability is something that remains maintained with those types of transactions. So, on both fronts, we’ll have products launches here, and we’ll continue to look for those opportunities. But at the same time, we’re going to look at it in a very thoughtful way, ensuring that it only grows our financial health and only grows our total addressable market. At the same time, we’re very confident in the business that we have. We have a very healthy electroporation platform that’s differentiated from the field. We have the premier gene editing off-target assessment in a platform as well.

We’re going to continue to focus on those and organic development from both those companies as well.

Operator: Thank you. One moment for our next question. Our next question comes from Dan Arias with Stifel. Your line is now open.

Dan Arias: Afternoon, guys. Maher, one of the themes coming into this year was just this idea that the pipeline funnel within the industry was starting to open up again after this period where it narrowed because companies were needing to save money given the financing environment. You mentioned asset prioritization earlier in your prepared remarks. Is your sense that we’re starting to swing back towards portfolio narrowing again a bit, or are companies still holding the line in terms of the scope of what they’re working on?

Maher Masoud: Dan, great question. Early last year, we saw that rationalization of programs that companies were working on. Obviously, the beginning of this year has changed what we thought was going to be the expansion of that breadth of programs. We’re not seeing that much more rationalization, however, Dan. I mentioned that one of our SPL customers rationalized their programs to focus on their lead indication rather than expansion of the indications for that one program. We’re not seeing that with any other customer, though. Obviously, we’re keeping a close eye, and we’ll update if we do see it. But as of right now, we’re not seeing a re-expansion of programs, but we’re not seeing a continued rationalization other than that one SPL customer that we saw.

But at the same time, we also mentioned that in the past, I think late last year, we had one SPL customer as well indicate that they’re rationalizing their programs and focusing more in-vivo, where they ended up no longer pursuing their ex-vivo therapy there. So we saw that rationalization, but we’re not seeing too much more. We’re not seeing expansion. We’re kind of seeing the, I would say, status quo of what we’re seeing from the end of last year, Dan.

Dan Arias: Okay, that’s good. And then, Doug, maybe just a follow-up on the outlook. I know you’re not looking to get into quarterly views, but I wanted to ask about the cadence of revenues for the year and just a way to think about that. The street has sequential increases for core revenues that they’re modest, but they’re up each quarter. And at one point, I think the idea was that this gradual improvement in the end market conditions did kind of get you from one quarter to the next. Now that feels a little bit less okay. So can you just touch on what the drivers would be on the incremental step-ups if, in fact, you feel comfortable with modeling that way? Thanks.

Doug Swirsky: Yes. So we do feel comfortable modeling it out that way. It’s not because, first off, we said at the beginning of the year, we’re really not anticipating the market to really get better. The guidance we’ve provided sort of is based on where the market is now, recognizing that you can make a point that this market is slightly different than it was seven weeks ago when we spoke. But we do see when we look at our models that we do have some incremental growth, particularly at the back end of the year. And that’s really more of a reflection of specific identified opportunities within the pipeline and some initiatives that we’ve made within the sales organization. And so we feel very good about it. As you know, leases have been relatively consistent.

PAs, we can model that out based on pull-through and run rates in a variety of different ways. It’s really instruments of the hardest piece to forecast. And again, we do look at specific identified opportunities. This tends to build the revenue later in the year. Do I think that that’s based on purchase decisions that are because the market’s expected to improve? That’s not how we’ve addressed this and modeling this out and discussing. We actually and we do have a weekly call here with the commercial team where members of the accounting finance and operations team sits down with the commercial team. And we really do go opportunity by opportunity to understand where those specific sales can manifest itself, so that we can come to this call with the confidence that we’ve got the right guidance in front of investors

Dan Arias: Yes. Okay. Thanks, Dan.

Operator: Thank you. At this time, I’m showing no further questions. I would now like to turn it back to Maher for closing remarks.

Maher Masoud: Thank you, operator. And thank you, everyone, for joining us on today’s call. We look forward to speaking with all of you and hearing from you again on our next earnings call in a few months.

Operator: Thank you for your participation in today’s conference. This does conclude the program. You may now disconnect. Goodbye.