OmniAb outlines $18M–$22M 2025 revenue guidance while launching OmniUltra and expanding xPloration platform

Earnings Call Insights: OmniAb, Inc. (OABI) Q3 2025

MANAGEMENT VIEW

* CEO Matthew Foehr reported continued strong deal flow in the third quarter with new program additions for 2025 already matching the total from all of 2024. He highlighted that "the number of new program additions this year is far outpacing last year," and the base of active partners has grown to over 100, a record high for the company.
* Foehr announced the upcoming December launch of "OmniUltra, which is the first transgenic chicken that produces cow-like antibodies with ultra-long CDRH3s," adding that the technology "has the potential to open new markets and new business opportunities for us and to expand our reach into enabling the discovery of novel peptide therapeutics."
* The company realigned staffing levels and executed a $30 million private placement to enhance financial flexibility. Foehr welcomed new and existing shareholders who participated in the transaction.
* CFO Kurt Gustafson stated: "For the third quarter of 2025, we reported revenue of $2.2 million, and this compares to $4.2 million for the same period in 2024. The decrease was primarily related to a reduction in milestones achieved and lower service revenue." Gustafson also noted a decrease in operating expenses to $20.4 million and a net loss of $16.5 million or $0.14 per share for the quarter.

OUTLOOK

* CFO Gustafson updated financial guidance: "We now expect that 2025 revenue will be between $18 million and $22 million and operating expense will be between $82 million and $86 million." He also stated, "We continue to expect that our cash used in 2025 will be lower than the cash used in 2024, excluding financings in both years, and we expect our year-end cash balance to be between $52 million and $56 million."
* Gustafson explained that some milestones expected in the second half of 2025 have been delayed to 2026, prompting the guidance update. The company continues to expect a tax rate of approximately 0%.

FINANCIAL RESULTS

* CFO Gustafson reported revenue of $2.2 million for Q3 2025, compared to $4.2 million for the same quarter in 2024, citing reduced milestones and lower service revenue. He noted that the current quarter included xPloration revenue from consumables and modest royalty increases.
* Operating expenses declined to $20.4 million from $23.9 million year over year, with R&D expense at $10.4 million and G&A expense at $6.8 million. The quarter included a nonrecurring charge of about $800,000 related to a headcount reduction.
* The company ended Q3 with $59.5 million in cash, supported by the $30 million private placement, which netted $28 million.

Q&A

* Michael Almisry, Leerink Partners: Asked about the motivation for the private placement and cash runway. Gustafson replied that "we took that opportunity to strengthen the balance sheet. I feel like the company is now well capitalized."
* Almisry asked for color on xPloration customer interest, bookings, and order timelines. Foehr responded, "interest has been very strong... it is definitely the higher tier of partners who are the most active and likely the ones who will benefit the most from xPloration."
* Sara (for Joe Pantginis, H.C. Wainwright): Inquired about OmniUltra launch readiness and pilot projects. Foehr stated, "We've done a substantial amount of validation work around OmniUltra with many, many targets that we know are of interest to the industry... we have a really good sense of the breadth of applicability of this technology and I think are really well positioned for the launch in December."
* Alexander Xenakis, Truist: Requested an update on xPloration revenue potential. Foehr answered, "We've not given precise guidance at this point. I think as we progress through the launch, as we get additional instruments sold and deployed, we'll have more visibility there, but we're feeling really good about how it's positioned."
* Matthew Hewitt, Craig-Hallum: Queried about partner program delays and R&D budget trends. Foehr characterized milestone delays as "standard development stuff" and said, "we are seeing continued momentum in program additions that has been sustained through this year, which is very good to see."
* Brendan Smith, TD Cowen: Asked about OmniUltra's economic model and royalty ramp. Foehr said, "we see OmniUltra as additive to the business, right, broadly applicable and opening up new fields for us... this does open new opportunities for us to drive service revenue in the near term." Gustafson explained, "we typically take a look at what analyst consensus are for these drugs... they're expected to be very large drugs."

SENTIMENT ANALYSIS

* Analysts' tone was neutral, focused on clarity regarding capital position, xPloration and OmniUltra launches, and revenue potential, without overt skepticism or optimism.
* Management maintained a confident and constructive tone throughout, with Foehr stating, "we feel good about where we are," and Gustafson emphasizing the company is "well capitalized." During Q&A, management provided detailed answers and reiterated confidence in new initiatives and financial positioning.
* Compared to the previous quarter, both management and analyst sentiment remained steady, with management’s confidence level consistent and analysts maintaining a pragmatic, fact-seeking approach.

QUARTER-OVER-QUARTER COMPARISON

* Active partners increased to 104 from 100, and active programs rose to 399 from 381, with 18 programs added in Q3 alone.
* Financial guidance for 2025 was reduced from $20–$25 million revenue and $85–$90 million operating expense (Q2) to $18–$22 million revenue and $82–$86 million operating expense (Q3), reflecting delayed milestones.
* Management maintained a focus on streamlining expenses and highlighted greater financial flexibility after the $30 million private placement.
* Analysts’ questions shifted slightly toward seeking specifics on commercial launches (OmniUltra, xPloration) and royalty ramp, while the previous quarter focused more on technology launches and partner mix.
* Management’s confidence in core technology and new offerings was consistent, while the update on milestone timing and guidance was a new area of focus.

RISKS AND CONCERNS

* Management cited milestone delays as a primary challenge, with some expected in late 2025 now pushed to 2026.
* Program attrition was acknowledged as a "normal part of our business" due to partner shifts in priorities and budgets.
* Analysts questioned the sustainability and timing of new revenue streams from xPloration and OmniUltra, as well as the ramp in royalties across the partner pipeline.
* The company responded by emphasizing a diversified partner and program base, recent cost controls, and the potential of new technology launches to drive future growth.

FINAL TAKEAWAY

OmniAb emphasized strong partner and program growth, the upcoming launch of the OmniUltra platform targeting novel antibody and peptide therapeutics, and the expanding commercial opportunity of the xPloration instrument. While 2025 financial guidance was lowered due to milestone delays, management highlighted strengthened financial flexibility after the private placement and ongoing momentum in core business metrics. The company projects further growth from new technology launches and recurring revenue streams, reinforcing its position for long-term value creation.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/oabi/earnings/transcripts]

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