Overall Revenue Growth
Total revenue grew 13% year over year in Q1 2026; this is the first Q1 in nearly three years with revenue above $11 million.
Clinical Solutions Surge
Clinical Solutions revenue increased 85% year over year to $2.1 million (from $1.2 million), driven by an increased number of customers and higher average revenue per customer; management characterized the growth as broad-based rather than a single large order.
Lab Essentials Stability
Lab Essentials revenue was $8.4 million, up 3% year over year from $8.1 million, supported by higher average revenue per customer despite a decreased customer count.
Improved Profitability Metrics
Gross profit rose to $3.8 million from $3.0 million year over year; gross margin improved to 34.2% from 30.7% in Q1 2025. Adjusted EBITDA improved to negative $2.0 million from negative $2.5 million.
Cash Flow and Balance Sheet Improvements
Free cash outflow improved to $3.6 million from $4.3 million year over year (approximately a 16% improvement). Cash, cash equivalents, and short-term investments totaled $17.8 million with total borrowings of $13.2 million as of 03/31/2026.
Operational and Process Enhancements
Operational initiatives included tripling single-batch size for high-volume bottle production and implementing an automated aseptic filling line to scale volumes and reduce labor hours per unit; 90 of over 3,000 paper batch records migrated to digital to improve analytics, documentation quality, and standardization.
Commercial Investment and 2027 Growth Target
Company initiated roughly $2 million annual increase in commercial spend (sales and marketing) starting in 2026 to drive lead generation and field coverage; management expects to see revenue impact by early 2027 and is targeting approximately 20% revenue growth in 2027.
Reiterated 2026 Guidance with Manageable Expectations
Management reiterated 2026 revenue guidance of $42 million to $44 million (midpoint implying ~6% growth versus 2025) and expects gross margin in the mid-30s for the full year; free cash outflow is expected to be less than $10 million for full-year 2026 despite increased commercial investment.