Cytek Biosciences Reports Mixed Earnings Amid Growth and Challenges

Cytek Biosciences, Inc. ((CTKB)) has held its Q4 earnings call. Read on for the main highlights of the call.

The recent earnings call of Cytek Biosciences, Inc. revealed a blend of accomplishments and hurdles. The company reported growth in revenue and adjusted EBITDA, primarily fueled by international market success and increased service revenues. However, challenges such as stagnant product revenue, difficulties in the U.S. market, and potential obstacles from NIH funding cuts and currency exchange rates were also highlighted.

Revenue Growth

Cytek Biosciences experienced a 4% increase in full-year revenue for 2024, reaching $200.5 million. This growth was largely driven by a strong performance in service revenue and significant double-digit growth in international markets outside of the U.S.

Adjusted EBITDA Surge

The company reported a remarkable surge in adjusted EBITDA, which rose by more than 77% to $22.4 million in 2024, compared to $12.6 million in 2023. This increase underscores the company’s operational efficiency and successful cost management strategies.

Service Revenue Increase

Service revenue saw an 8% increase in the fourth quarter of 2024, attributed to the expansion of the total installed base of instruments. This growth highlights the company’s focus on enhancing its service offerings.

International Market Success

Cytek Biosciences enjoyed a robust demand environment in the Asia Pacific and the Rest of the World regions, with a 21% growth in Asia Pacific, driven by strong performance in China. This success underscores the company’s strategic emphasis on international markets.

Cytek Cloud User Growth

The Cytek Cloud user base expanded by more than 160% since the beginning of 2024, reaching over 16,000 users. This growth reflects the increasing adoption of Cytek’s digital solutions.

Flat Product Revenue

Product revenue decreased by 3% in the fourth quarter of 2024 compared to the same period in 2023. This decline was influenced by the strong U.S. dollar and a softer instrument market in the U.S. and EMEA.

Challenges in U.S. Market

The U.S. market posed significant challenges, with total revenue declining by 10% year-over-year in the fourth quarter of 2024. This was primarily due to a reduction in academic and government instrument revenues.

Currency Exchange Impact

The appreciation of the U.S. dollar negatively impacted revenue, particularly in the EMEA region, where revenue declined by 18% year-over-year in the fourth quarter of 2024.

NIH Funding Reduction

Cytek faces potential headwinds from the NIH’s reduction in funding for indirect costs associated with grants, which could affect approximately 5% of the company’s revenue.

Forward-Looking Guidance

Looking ahead, Cytek Biosciences has set its 2025 revenue guidance between $204 million and $212 million, indicating a growth of 2% to 6% over 2024. Despite anticipated challenges such as changes in NIH funding and potential tariff impacts, the company expects continued strong growth in its service business and robust demand in the APAC region, contrasting with softer conditions in the U.S. and EMEA.

In conclusion, Cytek Biosciences’ earnings call painted a picture of both progress and challenges. While the company has achieved significant growth in international markets and service revenues, it faces hurdles in the U.S. market and potential financial impacts from external factors. Nevertheless, the company’s forward-looking guidance suggests a cautiously optimistic outlook for 2025.