On Wednesday, Ginkgo Bioworks Holdings IncDNA made public preliminary FY23 sales of $250 million-$260 million, differing slightly from the consensus of $258.65 million.
Preliminary cell engineering and biosecurity revenue are projected to fall within the disclosed range of $145 million-$150 million and up to $110 million in 2023, respectively.
New Cell Programs are expected to align with the previously disclosed range of 80-85 new Cell Programs added to the platform in 2023.
William Blair views Ginkgo’s recent update positively, despite a reduction in the full-year program target from 100.
The accelerated pace of program announcements correlates with a new success-based pricing model and operational enhancements.
Ginkgo also completed the program’s pilot phase with Novo Nordisk A/S NVO and completed a gene therapy collaboration with Biogen Inc BIIB.
The company’s ability to converge automated data generation at scale with AI models tailored to customer program areas is expected to lay the groundwork for additional pharmaceutical partnerships in 2024.
Ginkgo concluded 2023 with approximately $950 million of cash and cash equivalents.
Furthermore, the company reported over 50% growth in cell engineering revenue from biopharma clients in 2023, indicating market strength despite uncertain macro conditions.
The present valuation of Ginkgo’s shares stands at 10.3 times their projected 2024 cell engineering sales target—a premium compared to other high-growth life science tools peers.
William Blair believes Ginkgo is solidifying its position as a leading horizontal platform in synthetic biology, endeavoring to democratize access to cell programming. Nevertheless, concerns linger about the feasibility of growth expectations and the path toward a more robust financial model. As a result, William Blair maintains the Market Perform.
Price Action: DNA shares are down 5.30% at $1.43 at the last check on Wednesday.
