8-K: Twist Bioscience Reports Strong Q3 FY26 Revenue Growth

Twist Bioscience announced record revenue of $118.4 million for its fiscal third quarter of 2026, a 23% increase year-over-year, and raised its full-year revenue guidance.

Summary

• Twist Bioscience reported record revenue of $118.4 million for the third quarter of fiscal year 2026, representing a 23% increase compared to $96.1 million in the same period of fiscal year 2025.
• This marks the 14th consecutive quarter of sequential revenue growth for the company.
• Gross margin improved to 52.8% in Q3 FY26, a 120 basis point increase from the previous quarter.
• Full-year fiscal 2026 revenue guidance has been raised to $456-$457 million, an increase of $12 million at the midpoint.
• The company reiterates its expectation to achieve adjusted EBITDA breakeven in the fourth quarter of fiscal year 2026.
• Net loss for the quarter was $35.1 million, or $0.56 per diluted share, compared to a net income of $20.4 million in Q3 FY25, which included a significant gain from a business spin-out.
• Adjusted EBITDA for Q3 FY26 was a loss of $11.3 million, compared to a loss of $8.0 million in Q3 FY25.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this as a positive report, with strong revenue growth and a raised full-year guidance, indicating upward momentum despite continued net losses.

Positives

• Record revenue of $118.4 million in Q3 FY26, up 23% year-over-year.
• 14th consecutive quarter of sequential revenue growth.
• Gross margin increased to 52.8% in Q3 FY26.
• Full-year FY26 revenue guidance increased by $12 million at the midpoint to $456-$457 million.
• DNA Synthesis and Protein Solutions (DSPS) revenue grew 39% year-over-year to $56.6 million.
• NGS Applications (NGS) revenue grew 12% year-over-year to $61.8 million.
• Shipped products to approximately 2,650 customers, an increase from 2,480 in the prior year.
• Physically shipped approximately 369,000 genes, a significant increase from 237,000 in the prior year.

Negatives

• Net loss for Q3 FY26 increased to $35.1 million, compared to a net income of $20.4 million in Q3 FY25 (which included a $48.8 million gain from a spin-out).
• Adjusted EBITDA loss widened to $11.3 million in Q3 FY26 from $8.0 million in Q3 FY25.
• Selling, general and administrative expenses increased to $80.7 million from $63.4 million in the prior year's quarter.
• Cost of revenues increased to $55.9 million from $44.8 million in the prior year's quarter.

Risks

• The ability to attract new customers and retain and grow sales from existing customers.
• The ability to achieve sufficient revenue to reach or maintain positive cash flow from operations or profitability.
• Rapidly changing technologies and extensive competition in synthetic biology could make products obsolete or non-competitive.
• Dependence on a single supplier for a critical component.
• Dependence on key personnel.
• Additional regulations could increase costs and delay commercialization.
• Changes in U.S. trade policies and other trade actions could result in increased costs and supply chain disruptions.
• Uncertainty regarding economic and market conditions and the impact of adverse economic conditions.

Future Outlook

Twist Bioscience has raised its full fiscal year 2026 revenue guidance to $456 million to $457 million, representing approximately 21% year-over-year growth. The company expects gross margin to be above 52% for the full year. For the fourth quarter of fiscal year 2026, the company anticipates total revenue of approximately $123 million to $124 million and expects to achieve adjusted EBITDA breakeven.

Management Comments

• "We continued our pattern of strong growth, reporting our fourteenth consecutive quarter of growth and exceeding guidance with revenue for the third quarter of fiscal 2026 of $118.4 million, growth of more than 23% compared to the third quarter of fiscal 2025."
• "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. That milestone is not the destination. It's the foundation for delivering disciplined execution and profitable growth as we move through fiscal 2027."

Industry Context

StockSavvy.ai notes that Twist Bioscience's sustained sequential revenue growth in the synthetic biology sector, particularly in DNA synthesis and NGS applications, aligns with broader industry trends driven by advancements in genomics, drug discovery, and diagnostics. The company's ability to scale production and improve gross margins is crucial in this competitive landscape.

Legal Proceedings

• The filing mentions 'Litigation settlement costs, net of recoveries' of $7,205 thousand in the nine months ended June 30, 2026, but provides no further details on the nature of the litigation.

Stakeholder Impact

• Shareholders: Positive impact from raised revenue guidance and continued growth trajectory, though net losses persist. Potential for future profitability is a key focus.
• Employees: Continued growth may lead to increased opportunities, but the focus on achieving profitability could influence resource allocation.
• Customers: Continued product shipments and potential for new product introductions (e.g., Twist Complex Genes) benefit customers.
• Creditors: The company's cash position of $167 million provides a buffer, but ongoing net losses require careful financial management.

Next Steps

• Achieve adjusted EBITDA breakeven in the fourth quarter of fiscal year 2026.
• Continue disciplined execution and profitable growth through fiscal year 2027.
• Commercialize Twist Complex Genes.
• Continue to drive innovation across diagnostics, therapeutics, industrial, agriculture, and research markets.

Key Dates

Recommendation

The company demonstrates strong revenue growth and has raised its full-year guidance, which is positive. However, the increasing net loss and widening adjusted EBITDA loss, despite progress towards breakeven, warrant a cautious approach. The stock is likely to react positively to the revenue news, but the path to sustained profitability remains a key concern. A 'hold' recommendation reflects the balance between growth and ongoing financial challenges.

Keywords

DNA synthesis, synthetic biology, biotechnology, revenue growth, financial results, gross margin, EBITDA, guidance