Alpha Teknova, Inc. (NASDAQ:TKNO) Q2 2023 Earnings Call Transcript

Stephen Gunstream: Yeah, yeah. This is some we are really proud of. We spent the last two years building out this facility. It really takes the company to a position where we can bring customers in and they’re not concerned about the long-term ability for us to deliver for them. And like I said, we’ve had a number of customers that are ready. And every one of them said, this is where we want our stuff made. This is perfect. And what we’re looking forward to moving towards over time. So, that’s all very positive from those from the capability of the facility, combined with our existing other facilities, we can get to about $200 million in total revenue from a capacity standpoint. But probably more relevant here is the fact that we have built a facility that specializes in these sort of less than 1,000 leader batch sizes.

All the way down we can we can do, one liter bags or even smaller in this facility and is extremely flexible and how we operate with a number of redundancies, as well. So, what we’re finding and we bring some of these customers in, it’s not just the sort of the fact that we have this capacity. But we’ve built a purpose-built facility that can do this custom manufacturing at these small scales and then scale with them all the way up through commercialization. And they’re and they’re excited and we are to this. So I think, the early indicators on us is that, this is the right type of capability for them for the long term. And we’re how kind of working them through the audit schedules and bring them in. We will do the pile up and then over the course of the next couple of years, hopefully get in become one of few suppliers as they go into clinical trials.

Mark Massaro: Okay. Thanks for the color.

Operator: Thank you. One moment for our next question. And that will come from the line of Jacob Johnson with Stephens. Your line is open.

Jacob John : Yeah. Thanks for taking the questions. Good afternoon. Maybe just another one on guidance as relates to Clinical Solutions kind of the implied back half number there. I understand you had a lumpy order at 2Q, but it’s still at the midpoint implies something kind of lighter than, than 1Q and that, I understand the macro environment. But could you just speak to why such a step down in the back half? And maybe related in that the sausage you’re seeing is the customers ordering less than you thought they would previously or some of these orders are getting pushed into 2024?

Matthew Lowell: Yeah, I’ll take it first and then Stephen can comment if you want. So, yeah I think from your observation, it’s fair Jacob, the back half guidance for our implied guidance for the Clinical Solutions business is certainly a step down from what we’ve seen here in Q2. In general, what we’re seeing is the environment that is essentially unchanged what we’ve been seeing earlier in the year and of course, in Q2, we did have this particularly large order from one customer go through during the quarter. So we’ve gotten the nice boost during Q2. So, Q3 and Q4 we’d expect it to go back to more normal from what we’re seeing in this environment, although of course, we are expecting that to come back as the environment improves. But in terms of smaller orders are fewer customer, I’ll let Stephen can maybe?