RPID - Earnings call 2 2021 | Rapid Micro Biosystems, Inc.

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Rapid Micro Biosystems Second Quarter 2021 Earnings Conference Call. [Operator Instructions] I would now like to hand the conference over to your speaker, Mr. David Deuchler with Investor Relations. Please go ahead, sir.

David Deuchler

Good afternoon, everyone, and thank you for joining Rapid Micro Biosystems Second Quarter 2021 Earnings Call. the and Deuchler David Gilmartin Group. I'm

the call Chief Executive the Earlier copy Rapid results of from XXXX. release June Chief the Rapid Spignesi, Rob today, company's for financial released available have the we Micro quarter Officer; A Officer. ended XX, Micro, Financial On second is and on press Wirtjes, Sean website.

securities to from statements that of expressed the laws, in will make meaning statements or Any this call include Before expectations to statements harbor are management of or are or the we due call Reform future forward-looking statements variety provisions Private of to contained XXXX. which that materially federal that performance relate results begin, to made pursuant of factors. remind you those in I'd this Actual forward-looking Securities the forward-looking like Act within implied safe during Litigation results events, statements. a predictions, differ may the

considered of and the We Securities Factors to Commission not description Form you conference with that section filed and Risk should broadcast August only you list factors, July as the information only XX, S-X should of contains these on guarantee the XX, are live and of to consider with a today, uncertainties Rapid and business, and these refer risks urge For our please Micro's time-sensitive XXXX. associated statements Exchange and of be call future be XXXX. This aware estimates performance. is accurate

statements, otherwise. to the that, of information, over Micro turn Rob. by or revise as financial law, because required any call to new obligation, forward-looking or or or any I'll And except events Rapid update projections future with disclaims intention whether

Robert Spignesi

Sean I'll second then opportunity of we followed and and review saying financial with first a very IPO. to XX. David, significant my for by who a business it before including underwriters' financial IPO the an for and and overallotment we Thank call good option. with pass everyone. start front open us. see operational everyone to by on speaking on that exercise quarter, like I'll overview a you, our million for for detailed the net to the highlights of I'd $XXX listed we remarks afternoon, proceeds, over review approximately in be like up of NASDAQ begin excited the we're the The We'd questions. raised to our time supported of following July us during their our you thank in

the team of thankful are dedicated our support We for and Micro hard customers of work and for the shareholders. Rapid our

complete, of our we the Growth than ever With the IPO now to are our global accelerate to adoption biopharmaceutical within manufacturing. on platform better Direct positioned strategy execute

report million, growth we commercial XXX%. continued platform X had performance We systems with placed year-over-year are adoption demonstrates robust that pleased This a representing of second XX with quarter during to the revenue our systems $X.X validated reported quarter. strong of of Direct and Growth

compared to to $XX today announced at would represent XX% of at million, commercial full also growth which our XXXX. be revenue XXXX that We expect least least year we

Growth Additionally, consumable we current our million shipped the our generation Direct X of launch since system.

very of also addition talent great continuing the and are team our We with the across to we to report that grow pleased company. new are

capability new of and new a Pacific. these believe Asia as our expanded executive we include quarter, expand second and our a to goals. innovation and the Counsel team well of to General our General R&D, During our team in as support Manager growth our and President Board leadership will Directors additions Vice We

product our minutes While end platform. company, to of process, and provide IPO of take markets our rate we a our many had few like store a overview a to chance to tell to our through today our brief I'd you

while quality The a element control microbial control For and infrastructure. critical the is quality the market modalities pharmaceutical aspect global gene advanced and pharmaceutical of background of regulated traditional is therapies, meet global fundamental small from pharmaceutical and per context, therapies. or change, $X global undergoing trillion biologics process transitioning to global tremendous rapid MQC, year modalities, growing including revolutionizing Biosystems at manufacturing molecule cell for demand X% and micro to

testing meet technologies. To pharmaceutical materials, on and of pharmaceutical confronting capacity and harmful environments, The personnel, in-process production complexity, other a growing products the and materials the mold MQC microbial automation bacteria, as final demands massive sterility contamination, such organisms. scale, and process future of for of digital companies, a depends global deployment includes regulatory manufacturing constant testing drug raw

method letters of incubated decrees. conduct MQC visually was method developed manual not growth inspected traditional including on is ensure labor-intensive years promotion, with manually of tests thousands and to is and microorganisms. MQC tens XXX conduct of The then Form samples MQC single to by This and growing critical consent may from and monitored called A safety. lack compliance, production per manually has helps changed to even MQC specialists, by is agencies serious observations, for process million testing patient mandated processed, MQC FDA anywhere year. or The plates regulatory fundamentally other for because drug where X consequences about collected warning since. are and closely XXX ago it the financial testing global media colonies facility ultimately regulatory

Today, still global slow, The and results. is to well XX process. to of MQC deliver legacy nonautomated this days testing complexity uses costs, legacy approach despite by up requiring posed process MQC XX% a over risk growing

steps Second, the entirely human involves. of on process labor XX legacy is dependent for each the it

falsification vailability, for subject is potential process error and legacy the data. of even the technicians to Third,

in enforcement process shareholder unsecured, including spawn have manufacturers, These legacy real-world value for with problems costly substantial result some pharmaceutical and is data risks multiple noncompliance regulatory destruction. which can integrity long investigations, the in Finally, cases, regulations. actions,

pharmaceutical manual these legacy unable of has growing MQC reliable requirements For it less manufacturing. is the to become process and as reasons, the match scale modern

this to solve specifically technology our problem. developed We

in support with over automated, Developed platform and MQC Our XX a for modalities, the robust Growth novel and gene as scalable and and the only therapies solution in These active sterile of such world. therapeutic to demand we cell have years customers, investments solution purpose-built, improvements. in investments Direct from our injectables. fully biologics, is secure feedback complex the and vaccines, significant difficult-to-replicate high expanding have made engineering throughput rapidly resulted

fully Our replace the Growth designed Direct platform is traditional automate to MQC and process. manual

natural replacing counting Our proprietary works and of software autofluorescence. analysis with and microbial detection by technology on human growing colonies counting based of image algorithm-driven

regulations. this high wraps with compliance high system fully secured interface with core sample locked a integrity walkaway behind enables robotic technology volume, Our incubation, capacity handling that and detection automated, data

and is required by accuracy, manufacturing. pharmaceutical scalability several of improvement technology results advanced Growth days, by eliminating traditional X-step process. traditional accelerates XX% time Growth the Direct simple Direct workflow, speed, Our security a testing XX% over the delivers MQC MQC steps method. to manual of a a the

to the of risk of data accelerated system capacity Direct more and efficient, results, and time test from advantages errors, benefit Growth human manufacturing cost operations. savings, lower higher with a customers Our reduction integrity compliance ultimately

annually Globally, we manufacturing. quality pharmaceutical facilities dedicated market is in year. billions Moreover, multiple with facility of conducted manufacturing and be to volume, of therapeutics automate doses every XXX and estimate thousands absorb tests the is of microbial to designed system manufacturing majority Direct Growth are The operated producing scale can high-volume and daily pharmaceutical test test the of large. of fleets MQC any million systems MQC vast control

XXXX. study by market recent over be we XXXX, to our addressable approximately we on grow we CAGR estimate or Based $XX X% market, in commissioned, billion $XX expect TAM, total to an research our billion to which at

and we our believe we majority proposition control automation. As attracted pharmaceutical well a well operations embed customer automate products including positioned midsized platform manufacturing as the customer our exceptionally our is has top-tier to and The base, of the to of enable digitize as customers. manufacturers within begin XX workflows, global strength pharmaceutical future top the of global and value quality small

biologics, cell Our and gene manufacturers personal care small customers therapies, molecules, compounders and products. XXXB of include

installed our We as manufacturing Asia. customer half have a customers. date, multiple has significant America, as installed We more our network. new within systems existing customers expand market of opportunity share To which are site North systems, of across networks our well than multiple and manufacturing within sites Europe purchased see to global many base acquire across customer's in

all the Growth using note, biologics and all are cell we Of of pharmaceutical are modalities, system. in therapies and XX% gene address therapies. currently especially gene Direct we strong approved While cell and

I system systems earlier, completed mentioned placements quarter, during to XX As validated. totals second the systems X we and cumulative system bringing placed and validations XX XXX our

commercial initial about this have excited While start, we runway ahead. significant we are

Our streams revenue model. blade being Growth platform revenue attractive drives razor, razor Direct multiple

Direct this then services customers and system Growth begins customers of and provide Direct increasingly Initial associated starts workflow. a transitioned secure customer Growth and routine equipment of validate provides a support install the revenue connection each high suite lab sale software, broad the validation Once is of and paperless volumes data proprietary validated to and and Growth consumables. to system capital to pull-through We system our information our help management Direct. use, X-way, global system with which

we and profitability of we As add an durable our utilization a consumables drive will attractive increases, with systems and substantial, base to profile. stream validated revenue expect recurring

which ongoing provide to drive revenue. revenue recurring maintenance in consumable also services, recurring preventative We service addition

broadly and market across forward, goal Direct control focused for on business. ultimately microbial of excited test the growth opportunities We're tremendously the pharmaceutical manufacturing we're MQC Growth global industry. automation Looking on delivering standardizing about platform more the our quality our

We position believe growing we competitive are with very intensity. strong and market low to capitalize large a a in on

gene strategic We a high-growth and cell commercial are advantage therapy biologics especially in our and segments. strong leveraging momentum, to accelerate

Our growth is clear. strategy

pharmaceutical adoption across We continue the industry. customer global to new drive

We sites systems, to are the and deliver. expanding placing applications expanding existing broadening customers within our new more we

and geographies services as build Pacific, deliver launch to operational spanning products the And see we intend to new that to integrated Asia our QC data, commercial we and consumables, substantial automation future, automation. opportunity targeting are where to new look footprint. include we We

within to over influence upstream customer wallet our grow workflows expect and more time. secure and downstream customer of share We

in accelerated build as We key future have With revenue accelerate geographic also growth. to development U.S. to We are proceeds, teams in and research continue and AsiaPac. to and with Europe, as our we teams innovation. adoption as in a infrastructure IPO well increasing well-established Europe to commercial expansion opportunity to these to commercial the U.S. our significant driver investment see the investment drive in

M&A financial had excited services start we selectively organic strong business we future, to proposition products closing, to believe we add enhance are for the use quality there's also over over results. coming the Sean? to going and very space years. invest an We addition define our to look own future XXXX, global In in to call In our to the as may the forward and customers. our now our you about standard. complementary I'll a to and exciting value business Sean We we control investments have forward. updating microbial expand opportunity the to and to discuss turn

Sean Wirtjes

Thanks, everyone. good Rob, afternoon, and

streams Before business. review to our through to revenue we're why QX and I understanding you today like results, and reporting that KPIs we walk our believe I'd they're important the

Our today we received Direct rapid revenues Commercial total both our and from BARDA currently have of under Noncommercial an new Growth XX% a over products existing develop sales comprised noncommercial both are and to our to contract revenues our on of for consumable revenues relate of system. commercial component. customers. our component testing a sterility funding represent services a revenues and to

recurring are of system which nonrecurring recurring. LIMS both component includes business which time. of the includes service we and and component important service our are of nonrecurring them connection progress because our services, revenue report product as recurring as contracts. We as as revenue our which sales break revenues our and as commercial, view The Growth an out as KPI well annual a over Direct software, measure of well validation consumables, installation are them sales Within

placed. of the product provide on contractual our occurs ship because System plan systems system information placement deliver or the systems the of they a KPIs, about terms number to other a when placements we component drive we terms. In system of depending to revenue. customer, important A are

because important number validated, customer plan to at unlocking to with provide our system the once meaningful pull system consumable sites. Validations customer that also validated the is systems We routine we use, work can to then are through. of transition

impacted QX second systems of representing this the both Within revenues over revenues negatively last in Now our other access commercial period. was were a which turning system with those $X.X million. for XXX% placements customer issues Many growth placed the consumables year. standpoint, revenue revenue, and X QX in million last resolved up $X.X that grew some Commercial This was were of to positively revenue to over year, X the compares of which XXXX $X.X over our From quarter. closures in systems systems QX and QX results. QX by XXX% million we of total, year, year, Total limitations. last growing and last product made for XXX% results site quarter border in quarter. COVID-related from impacted

Service XXX% the validation lesser year. was last up second higher compared to same revenue recurring revenue to in due contracts. period service quarter, a was services and, $X.X million The from to the increase extent,

increase we the the process bringing XX of XX. in completed validation the During XXX% on almost months. systems, cumulative the validated of XX over This new field systems number are quarter, our represents an that the past to

important revenue view Given our the future to progress. as growth, implications for potential of this consumables significant metric we and this

continue on contract service million compared driven systems. we $X.X QX of as XX% and includes BARDA of up which was related well as million was validated contracts, revenue the revenue, $X.X by finish growth consumables consumables in base in was This grew revenue to revenue, triple-digit from contracts solid $X.X Recurring in and with XXXX. our year. second last to growth million noncommercial quarter grow growth compared in service to To as our QX to

Product revenues Moving or year were last $X.X million in or million mainly on Service gross QX XX% breakeven QX margins negative to resulting the services to margin $X.X this XX% leverage second year. this QX period $X.X year. negative XX% gross negative compared attributable same percentage the in both from year. or to million margins. higher to in were improvements in margins negative products The in compared and cost quarter were for in last

$X.X Total the in operating in drivers public P&L. related compares in This in company million R&D. Costs down operating included contributed of $X.X year-over-year of increase total quarter IPO with to of primary were second G&A sales marketing, anticipation sales $X.X Moving second the in the in made expenses and spending the million The $X.X we quarter, in XXXX. in $X.X increase. a were million investments OpEx OpEx in our spending the and process investments and G&A. marketing and and as also R&D to of million of million to

expenses $XX.X stockholders to compared loss share QX of $XX.XX second year. million, Net million amortization to in $X.X net quarter second million in With were $XX.XX respect the CapEx, expense million loss QX of comp and loss in million, XXXX. net per per was attributable compares noncash of depreciation second was to the and Net which and share in $X.X of quarter capital XXXX last common $X.X quarter was to loss a stock XXXX in of $X.X expenditures the XXXX. expense was a

in second debt, million We discount. quarter debt in with ended equivalents million $XX.X cash the and and $XXX of unamortized excluding cash XXXX

balance Following million our August, IPO, X outstanding. on we in our with common IPO exercise the early finished the equivalents in Prior sheet. and partial cash closing of and QX in shares our option underwriter's approximately their we July roughly $XXX million overallotment had cash of to

our of also exercise Following into million have outstanding IPO, an Class conversion basis. all which common their option, our outstanding Class overallotment shares B and on of the common stock the stock approximately A preferred now the of we triggered underwriter's of XX.X aggregate and closing

shifting Now guidance. to

customer governmental growth vigilant represent and expectations material progress remain compared changes we any basis, as at significant haven't business we which indication to sequential year revenues the changes QX. full won't our predicated date. on any policies to monitoring COVID be expect and spending revenues expect commercial our are including and On would a environment of improve increase, $XX OpEx to increase to million, relating through then least that XXXX. in to impacts, We gross material business XX% our seen of these least their These QX COVID. commercial to see policies and our in We to tightening we in environment, assumption potential margins XXXX at of we but

this the the to upon to in remarks. lender our I'd P&L. you the line model QX we currently pay below fee amount prepared to a of you in as QX former record closing that exit $XXX,XXX expect other to like Finally, were concludes this an We IPO. That remind our expense required year,

we'll questions. the So open point, up at this now Operator? for call

Operator

from [Operator JPMorgan. Instructions] with Our first question will Peterson Tycho come

Casey Woodring

Casey I for sort has know competitors is This similar is testing product. MQC first on guess little space? you a Tycho. one of Can landscape. I talk competitive the the a around about the Interscience in bit

Charles think about little River competition? on is side competitive a system bit Direct seeing Can and a little I what just competes. differentiated the you the talk how you're from Growth bit

Robert Spignesi

say there's competitive a it. low. of intensity the percent low. competitive in again, change legacy no competitive and believe, I'd with is of method we believe the been By course, is the Yes. environment far, But largest competitive remains be the have, the the competitor intensity we generally, we, using watching -- are XX-plus landscape. remains to we -- the market And

Moreover, any our there. our it, believe highly differentiated call -- the we out against companies technology-enabled the, is system of

that. capacity, it's and our We the throughput with we to custom-built there, And have right for high out the the customer other high pharmaceutical globally believe commercial compared and system makeup players effectively right -- it's our differentiated the traction built highly believe we market. base and represents

Casey Woodring

you. following then that. And Got on just up

During the got IPO we process, the question.

on long customers. around how only to guys around the have I compared XX% market, you've years, think of XX think penetrated pharma been think, you I I

bit can forward? to drive about moving further of how sort So and going historically penetration a you're here little you maybe talk penetration pharma

Robert Spignesi

Yes.

in of launch our So count important so current first that to Growth it's for context, note we recently. full system Direct relatively I XXXX, the think really,

official beta in the launched XXXX, effectively base, reaction the XXXX the segments. a had gene in perspective, in especially therapy in phenomenal commercial the and We global and biologics and cell customer a view top that launch from 'XX in we've So format. and global particular, among was initially it to

So system top of we're globally, but small continuing as to see our customers well. and also in the uptake global 'XX, not only broad-based in mid

to a -- broad-based again, right pharmaceutical value this proposition was are challenges the companies highly in So that have And mentioned, market. is market the we it's these differentiated. system specifically that for purpose-built, It that globally I this as experiencing. solve

Casey Woodring

queue. back Got you. then And and I'll last one me then for into hop

I build And sort would term, something at? you guess, menu some Or testing would aren't of thinking guess, look near-term you that guys personal I we how MQC that longer priorities, terms something be In out care buildout? guys menu of would expect this about point? at is

Robert Spignesi

trust Well, It's aware of we tremendous as momentum just us. currently of of market. certainly on very remarks, have amount in global we in segment, have front my the it, credibility pharmaceuticals. the I runway and into pharmaceutical although sales We've in strong we're mentioned you're focused and brand got a

So that market others. we're and focused those on for reasons

that to it's market can with You the mentioned menu, important note address our care current we platform. personal

and a So focused we've more focus follow commercial it'd is right of pharmaceutical operation. an of activity of future, be commercial again, pharma extension R&D an our our the But perhaps it'd the to market. global more our but of More less -- be now currently in and biopharma. global on resources

Operator

from with Morgan Our Tejas will next question Stanley. Savant come

Tejas Savant

but be mix in little Just mean, of half share in installation color and that? up a any backlog at thinking for And bit on terms then you site, what share of the in a means of your can of cycle heading color the slightly quick should multiunit Can me, some backlog that same site orders then into sales of back in different couple backlog we year? customers. placements terms a about? on you new same large here. the terms for and Rob, on And the slicing ones more new customer, way, I

Robert Spignesi

Yes.

us I across my particular, large won't schematically, any are networks. out specific get seeing global in per So we Tejas, their into companies, customers, remarks, rolling but previous

it, and funnel. our -- to in refer I'll So backlog, call by I'll --

systems their consists new orders funnel of those executing geographies that starting well -- both, will their healthy customers new us. it's sites, customers mix forward as Our those rollouts new current with into a across sites, expect as -- into got we current they customers drive within have of strong continuing our from

customers. confident So to all in our categories is are our funnel we're of forward-looking regard very and quite healthy, those both with funnel -- general of

Tejas Savant

orders, can And Rob, a Fair projects it. Got pull-through note underway consumable share the the shorten details of some then kinds specifically and process? on validation you Kaizen to instrument of cycle generation the related somewhat around around enough. have you from

Robert Spignesi

Yes, sure, Tejas.

lean our our a for clearly, And So process stream across -- we working value from And to business due our routine with speed [Technical at validation yes process apply have schools, and improve to improvement continuing -- looking partner use, do Kaizon so through through or our through Difficulty] and -- mapped holistically our to PO and productivity. that. we customers ways.

this the into get Rapid Micro, throughput improve the with details can call. validation partnership won't I within the efficacy process. our in customers, We but of only and speed on -- not and

Tejas Savant

Got it.

the testing sterility big versus BARDA year, November about you on and updates run et be cetera? competitive any that in perhaps then year? out can launch place to And And folks opportunity is good in next that contract to there like you think differentiation scheduled are a could plans? how Obviously, us this help capability Okay. but the Celsis,

Robert Spignesi

Yes.

than reverse system. The in is on the competitive -- will order, $X better our total size maybe billion. the consumable run So market

the So and the integrity, from that's platforms, other system, nature walkaway consumable, the will -- speed, the our assays the the market player really the clearly automation, from other data on capacity sterility of the automation, from and full to differentiated include throughput. digital any benefit our benefit

to can tell new XXXX I the potential current -- we're beta it's going. I the steer speaking level regard would high is At with With you, sterility. the give call and it, for to on That customers of we're how well. can a we'll in a be development regard program, to proceeding looking you level, high test,

Tejas Savant

hiring the seeing possibility given people any given cadence slower-than-expected in plans et half pressures, the companies supply pressures of are hiring inflation, of final I terms any mean, in to seeing And just at the one your good lot one chatter Perfect. a all science chain through for you back Sean. of cetera? terms a of the life moment? year, the Sean, that of around OpEx, are cost And

Sean Wirtjes

Yes. Yes. Sure, Tejas.

think the we costs very about we've commitments COVID think like inflation in and like safety I when stock things as things proactive, and early and So through with that, on supply been doing vendors. pretty hit, our longer-term building starting locking

there's in So those clearly of being pretty job doing some being the good We've to inflationary, with most that done, I guess, marketplace. able there that. headwinds avoid out by think, a I of proactive and

view and hitting us. pieces say I would that as and are something significant nothing mitigate we forward. of we kind going this point manage can't it's or to Bits it at continue that of

a In of sciences and hiring, competitive in clearly, out life in marketplace there terms general.

We hiring have successful I'd with pretty year say, have it. been through been, actively and this entire

year. we and accelerating as to of the move second of at looking the some into are We half that adding

recruiting are We that. and our both internally supplementing with help us capabilities, externally to

we very that for we'll meet tough to market. second able hiring the year. half goals the it's our optimistic in be So feel But a of

continue do to can So we're we'll we're to able things that. execute to on look at sure going we -- make to

Operator

will Our Cowen. Masucci next come with question from Max

Max Masucci

a on strong Sean, debut. Robert, congrats

Sean Wirtjes

Max. Thanks,

Robert Spignesi

Yes. Thanks, Max.

Max Masucci

of of underlying what the large you target, That's that revenue then that quicker we commercial Can gets year assumptions million could full on the providing some pace types number? And you a you events, just whether where order were. least $XX of above $XX validations million. maybe mark customer or upside? just appreciate at a be it to touch So

Sean Wirtjes

Yes. Sure. It's Sean, Max.

we right? So past drive cadence, up more we to that, little the sequential talked see number prepared validated expectation then around our systems you're think my in of go in I a the I We've almost we of going placements the sequentially to to We're systems. XX bit expect months. doubled in happen in remarks again field have what validating QX some -- is and QX. over

and over to drive consumable still help growth to pretty service to of we contract then going our to that's a time. So adding validation backlog. do, healthy us work have backlog And we're

that things growing we installed be revenue. the are those going customer build as and So base to all across our of base drivers base, for

think of that play I year to for of construct we rest kind So that's under. expect the the out this

I think there's across some for all the areas, potential upside. of those

I into second half. visibility think good system on looking the the the -- we side, have relatively out

want I where carefully the feel are. sure But think we're good make there to business well. that we we about as managing

I the think hard. of consumables a that there at point. there? opportunity pushing very to any an to is it's but area like where We'd little is, building be think we're there early some think forecast I this Is into

to So I there. to to, continue after think going put that level second we're need of we go conviction half. the our the but we there's opportunity the to We have into as don't it forecast, work way through

Max Masucci

Direct your we have X-year or X- these customers think period. over makes Growth multiple how just say, rolled out few Direct if network? then understand sense. about systems right the customers a, the global time you And absolutely want sites? in manufacturing they it's a several when generally, think customers systems which to of look out us the their roll one Growth that about platform the to help to at just how expand then pace to Yes, sites from Can to And

Robert Spignesi

will initial monitoring solving, Yes, to even across thematically a rollout an site, environmental water process a more customers purchases. problems multiple sites follow-on they'll The Max, then the typically as customers a purchase X go to they're products maybe well. initially through have like maybe a application They'll sites starts systems. and from And multiple validation different application, across some go maybe start typically Different sites installation multiple across usually where process. validation it's there, through Rob. -- at

Other customers will and roll therapeutic a globally single way. and to a category focus product category out even tend that on

now fits driven. and and starts out many with site the around and is from But done again, many, from And Europe how that one high really at there. customers a validated, regard So it rollout level, size typically Asia. have are the rolls America, there's all and across North that not to doing world a where it's

are say, we their wouldn't of our different that to necessarily As we far brand we quickening -- the are manufacturing are the feature, customers seeing networks. And a networks, mature but would timing, aware pace the and market. in as it from we've the a as I roll strong got seeing, I global are us, systems to more we and and out as of more market -- out call it's more seeing demand global a and highly capability

Sean Wirtjes

we've out a Yes. we And their Max, opportunities accelerate is on part and component our to accounts. at one look to rollout. that's build that is we as to that sales focused have these -- And try of thing I'd remit organization, key add

So into -- have to and have visibility they're to are that drive working going with the try across customers to world individual forward. reps process global our they

Robert Spignesi

tandem, reps our with And Right. in exactly.

Max Masucci

Makes sense. Good segue.

Now just that validation you investment the can most customer side deployments a period? for can the specific in increased side existing support it sense on sheet, think for give the the areas Or Is and is in sales enterprise shortening wins customer you've fortified growth? it assist the customer us the you where new balance on be impactful? to

Robert Spignesi

both, Yes. It's a of bit actually.

clear my you in sales very up our resources initial world. revenue -- we hiring that -- a growth. believe the may have and it's with We believe So in direct is do accelerate there starting around will remarks, picked ROI more

this doubling leading sales beyond. relatively than are we've IPO, more investment As on we know, we globally continue we'll into and in force direct up very do planning to and sales to looking XXXX had grow the you our year, but -- -- light may

for and process well As we your that sell question. more more of validations previous as roll our part demand that to drives customers out B discussion, per through

as believe it resources, We differentiators continue we'll to to So competitive ability customers, is validate a we differentiator. we among which to routine view other competitive to with add in a effectively validation our move advantage. customers, efficiently have a is use and business, with into them -- our partner our

and didn't We'll areas but growth continue on are to and are -- invest we'll topic, a separate longer-term the you of lever more the innovation another make investment. where as validation as there. those business And the imagine, you may R&D in for sure we're bit well. in level high investment we but That's see that as also -- be incremental But also that we volume-driven, focused group. investing those leverage

Operator

Our next Arias from Stifel. question with come Dan will

Daniel Arias

a here. you CAR-T relative what trying we little X initial intensity that asked et comes in just might at usage? when about mean when biologics, cetera? molecule, to on I just for at I accounts Direct see that of basis level customer, that that of just has Growth and see the the the a just of Congrats a sort high company, that's it understand call terms we a usage can you different of cell on a to a mean when focus box, talk look therapy, the small application Rob, bit know company across types you

Robert Spignesi

Yes.

would well. also say care, actual product So sterile that end what or of well. usage. biologic therapy is, oral kind end. more on Small be a personal higher depending the high be at generally at bit a type formats Dan, lower be to would would as higher the usage tend the we cell lower higher tend moderate formats and on end injectables manufacturing And therapies as and be I level, and then a to gene the and complex and molecule,

Daniel Arias

gross then think I like? some look of does And line. there includes the that reduction. margin path maybe, benefit What Okay. mean, leverage, but the also cost Sean, forward seeing on I the

there about to look on on to target, side, say too. the might maybe that to the And What's be way first anything want elements about? things? for we vendor would where should the think you you And the maybe it thinking consolidation, some do the helpful, what's cetera? outsourcing, timing cost you're So best et

Sean Wirtjes

Yes.

number a looking cost So levers we have take at different of out. that we're to pulling

You one. vendor vendor is consolidation, touched of of on them, one kind leverage

number category So I'd I it put strategic through procurement of of strategies, including the at one of out looking that at different a just into and under putting that cost we're our and mentioned. getting look broader products that point materials

looking cost well. We're the and make take they're at to replace design out with made build product and today, products, as looking otherwise, products our value changes at like how things of materials, at our we of so looking engineering what opportunities today

be out would that's at looking definitely our further a process. category Another verticalize to but crosshairs, bit little in ways maybe manufacturing our

sterilization, the we of bringing parts it's it that different of more of. that and where and taking things variable into of outsource, like turning including we manufacturing out So more cost that a cost things fixed in-house a drive can leverage

of be we're areas more significant would those focused So few the a on.

longer are are shorter some Some term. term,

years. see bit getting climb months And next to that's quite goal then as meaningful work do several forward than XX positive continue progress march continue and regular a over those. a to next margins over we those on the we to that the expect somewhere toward we'll in and higher So

Daniel Arias

Yes.

heard Okay, one mentioned. I just don't if I did. for think last And you very you good. which then Apologies me,

on a that's here. great really I these our companies growth for Just Asia, of obviously space mean, in source

specific capabilities to You grow you I footprint should plan pretty Can investment out small how rolling we just but the your you just look a there, to have talk and significantly. the think focus, presence about about footprint is there? Asia and

Robert Spignesi

Yes.

So role leadership and Singapore. we in with joining Scientific. Maynard, he's Fisher our Sean us we he's that Thermo based hired recently from started

Asia he direct include our as and time, force, around this to comments -- space, only consistent on well in services. is in and sales but operation commercial over that well to the to leader the field previous our balance region plan -- do growing commercial plan the the Pacific with validations as not So we of sales,

Daniel Arias

Okay.

Robert Spignesi

to our this but placements and region, revenue investment in in plan have accelerate We will region our -- the growth forward. going is the

Sean Wirtjes

Yes.

there, the relative mix. small fairly talked systems we just about Rob think I do revenue before as we today. we there I given have I opportunity. in the aggressive pretty is but revenue Asia be mean, to said, mean, want

attractive. we is -- very there's opportunity view that So

Daniel Arias

Okay.

So should regions the in of anything perspective, we rest -- regions? or Asia expansion in the from a should geographic assume other the we outpaces

Sean Wirtjes

investment investment, will investment productivity getting be Dan. on initially, -- it and that Well, then will

Ultimately, the growth of would out strong a on expect that. standby for of kind we So more region, yes.

Operator

Thank call to at time. this Rob the I'm to further Spignesi remarks. showing now any back like no further questions turn over Mr. would in for queue I the

Robert Spignesi

us much. as a a you all today Well, progress our our first on forward QX our earnings call I months. during look company. thank you public few for updating call joining to Thank very in you on

Operator

gentlemen, and your you participation. this Thank conference for concludes Ladies call. today's

You may -- a now -- have disconnect.

Rapid Micro Biosystems (RPID) 26 Aug 212021 Q2 Earnings call transcript