Alpha Teknova, Inc. (TKNO)

Overview

Since our founding in 1996, we have been producing critical reagents for the discovery, development, and commercialization of novel therapies, vaccines, and molecular diagnostics. Our approximately 3,000 customers span the entire continuum of the life sciences market, including leading pharmaceutical and biotechnology companies, contract development and manufacturing organizations, in vitro diagnostic franchises, and academic and government research institutions. Our Company is built around our knowledge, methods, and know-how in our proprietary manufacturing processes, which are highly adaptable and configurable. These proprietary processes enable us to manufacture and deliver high-quality, custom, made-to-order products with short turnaround times and at scale, across all stages of our customers’ product development, from early research through commercialization.

We have two primary product categories: (i) Lab Essentials, and (ii) Clinical Solutions. Our products cross all stages of development, from early research through commercialization. We offer three primary product types: (i) pre-poured media plates for cell growth and cloning; (ii) liquid microbial culture media and supplements for cellular expansion; and (iii) molecular biology reagents for sample manipulation, resuspension, and purification. Our liquid microbial culture media and supplements and molecular biology reagents are available in both of our two primary product categories; pre-poured media plates are available in our Lab Essentials category only.

We are ISO 13485:2016 certified, enabling us to manufacture products for use in diagnostic and therapeutic applications. Our certification allows us to offer solutions across the entire customer product development workflow, supporting our customers’ need for materials in greater volume and that meet increasingly stringent quality requirements as they scale from research to commercialization.

We manufacture our products at our Hollister, California headquarters and stock inventory of raw materials, components, and finished goods at that campus. We rely on a limited number of suppliers for certain raw materials, and we have no long-term supply arrangements with our suppliers, as we order on a purchase order basis. We ship our products directly from our warehouse in Hollister, California, to our customers and distributors, generally pursuant to purchase orders. We typically recognize revenue when products are shipped.

We generated revenue of $12.2 million during the three months ended June 30, 2026, which represented an increase of $1.9 million compared to revenue of $10.3 million during the three months ended June 30, 2025. For the three months ended June 30, 2026 and 2025, only 4.3% and 5.0%, respectively, of our revenue was generated from customers located outside of the United States. We generated revenue of $23.3 million during the six months ended June 30, 2026, which represents an increase of $3.2 million compared to revenue of $20.1 million during the six months ended June 30, 2025. For the six months ended June 30, 2026 and 2025, only 4.5% and 5.1%, respectively, of our revenue was generated from customers located outside of the United States. Our sales outside of the United States are denominated in U.S. Dollars. We primarily generate sales through direct channels and a small salesforce, supported by an established network of distributors.

We had an operating loss of $2.9 million during the three months ended June 30, 2026, compared to an operating loss of $3.4 million during the three months ended June 30, 2025. We had an operating loss of $7.2 million during the six months ended June 30, 2026, compared to an operating loss of $8.4 million during the six months ended June 30, 2025. While our expenses may fluctuate over the short term, we expect our expenses will increase in future periods, but at a slower rate, in connection with our ongoing activities as we:

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•
attract, hire, and retain qualified personnel;

•
invest in processes and infrastructure to improve operating efficiency and expand capacity at our facilities, including the ramp up of our new warehouse and distribution facility;

•
build our brand awareness and market presence through targeted marketing initiatives, strategic partnerships, and expanded sales efforts; and

•
increase investment in selling and marketing activities to drive customer acquisition, strengthen channel relationships, and support revenue growth across existing and new markets.

Impact of Broader Economic Trends on Our Business

We continue to closely monitor economic uncertainty in the U.S. and abroad. General inflation in the U.S. rose in recent years to levels not experienced in recent decades. While the rate of inflation has moderated in recent years, general inflation, including rising prices for our raw materials and other inputs, tariffs, as well as rising salaries and other expenses, can negatively impact our business by increasing our cost of sales and operating expenses. Inflation, together with uncertainty regarding future interest rate changes, and broader macroeconomic uncertainty, may cause our customers to reduce, delay, or cancel orders for our goods and services, thereby causing a decrease in or change in the timing of sales of our products and services. We cannot predict the impact of future inflation and interest rate changes on the results of our operations. Furthermore, changes to tariff and related international trade policy that began in 2025 have created uncertainty about the broader economy and our business. For further information regarding the impact of these economic factors on the Company, please see the risk factors identified in Part I, Item 1A, Risk Factors, of our 2025 Annual Report on Form 10-K.

Results of Operations

Comparison of the Three Months Ended June 30, 2026, and Three Months Ended June 30, 2025

The following tables set forth our results of operations for the three months ended June 30, 2026 and 2025 (dollars in thousands):

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Revenue

Our revenue disaggregated by product category for the three months ended June 30, 2026 and 2025, was as follows (dollars in thousands):

Total revenue was $12.2 million and $10.3 million for the three months ended June 30, 2026 and 2025, respectively.

Lab Essentials revenue was $9.2 million for the three months ended June 30, 2026, an increase of $1.4 million, or 17.9%, compared to $7.8 million for the three months ended June 30, 2025. The increase in Lab Essentials revenue was attributable to higher average revenue per customer and, to a slightly lesser extent, an increased number of customers.

Clinical Solutions revenue was $2.4 million for the three months ended June 30, 2026, an increase of $0.4 million, or 17.9%, compared to $2.1 million for the three months ended June 30, 2025. The increase in Clinical Solutions revenue was attributable to an increased number of customers, partially offset by lower average revenue per customer.

Our revenue disaggregated by geographic region, for the three months ended June 30, 2026 and 2025, was as follows (dollars in thousands):

Revenue from U.S. sales was $11.7 million and $9.8 million for the three months ended June 30, 2026 and 2025, respectively. Revenue from U.S. sales as a percentage of our total revenue was consistent period over period, representing 95.7% and 95.0% of our total revenue during the three months ended June 30, 2026 and 2025, respectively.

Revenue from international sales was $0.5 million for each of the three months ended June 30, 2026 and 2025. Revenue from international sales as a percentage of our total revenue was also consistent period over period, representing 4.3% and 5.0% of our total revenue during the three months ended June 30, 2026 and 2025, respectively.

Gross profit

Our gross profit for the three months ended June 30, 2026 and 2025, was as follows (dollars in thousands):

Gross profit percentage was 40.1% and 38.7% for the three months ended June 30, 2026 and 2025, respectively. The increase in gross profit percentage was primarily driven by higher revenue, partially offset by higher fixed cost absorption into cost of goods sold from faster finished goods inventory turns. This compares to the same period in the prior year that had benefited from unusually favorable manufacturing efficiency gains.

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Operating expenses

Our operating expenses for the three months ended June 30, 2026 and 2025, were as follows (dollars in thousands):

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Overview

Since our founding in 1996, we have been producing critical reagents for the discovery, development, and commercialization of novel therapies, vaccines, and molecular diagnostics. Our more than 3,000 customers span the entire continuum of the life sciences market, including leading pharmaceutical and biotechnology companies, contract development and manufacturing organizations, in vitro diagnostics franchises, and academic and government research institutions. Our Company is built around our knowledge, methods, and know-how in our proprietary manufacturing processes, which are highly adaptable and configurable. These proprietary processes enable us to manufacture and deliver high-quality, custom, made-to-order products with short turnaround times and at scale, across all stages of our customers’ product development, from early research through commercialization.

We have two primary product categories: Lab Essentials; and Clinical Solutions. Our products cross all stages of development, from early research through commercialization. We offer three primary product types: (i) pre-poured media plates for cell growth and cloning; (ii) liquid microbial culture media and supplements for cellular expansion; and (iii) molecular biology reagents for sample manipulation, resuspension, and purification. Our liquid cell culture media and supplements and molecular biology reagents are available in both of our two primary product categories; pre-poured media plates are available in our Lab Essentials category only.

We are ISO 13485:2016 certified, enabling us to manufacture products for use in diagnostic and therapeutic applications. Our certification allows us to offer solutions across the entire customer product development workflow, supporting our customers’ need for materials in greater volume and that meet increasingly stringent quality requirements as they scale from research to commercialization.

We manufacture our products at our Hollister, California headquarters and stock inventory of raw materials, components, and finished goods at that campus. We rely on a limited number of suppliers for certain raw materials, and we have no long-term supply arrangements with our suppliers, as we order on a purchase order basis. We ship our products directly from our warehouse in Hollister, California, to our customers and distributors, generally pursuant to purchase orders. We typically recognize revenue when products are shipped.

We generated revenue of $40.5 million in 2025, which represents an increase of $2.8 million as compared to $37.7 million in 2024. In 2025 and 2024, only 5.6% and 4.8%, respectively, of our revenue was generated from customers located outside of the U.S. Our sales outside of the U.S. are denominated in U.S. dollars. We primarily generate sales through direct channels and a small salesforce, however, some of our sales are generated through distributors.

We had an operating loss of $17.0 million in 2025 compared to $26.1 million in 2024. While our expenses may fluctuate over the short term, we expect our expenses will increase in future periods, but at a slower rate, in connection with our ongoing activities as we:

•
attract, hire, and retain qualified personnel;

▪
invest in processes and infrastructure to improve operating efficiency and expand capacity at our facilities, including the ramp up of our new warehouse and distribution facility;

53

▪
build our brand awareness and market presence through targeted marketing initiatives, strategic partnerships, and expanded sales efforts; and

▪
increase investment in selling and marketing activities to drive customer acquisition, strengthen channel relationships, and support revenue growth across existing and new markets.

Key Developments

•
On March 3, 2025, we entered into the Second Amended and Restated Credit Agreement with MidCap Financial Trust which provides for loan commitments in an aggregate amount of up to $28.245 million consisting of a $23.245 million senior secured term loan and a $5.0 million working capital facility. The Second Amended and Restated Credit Agreement includes minimum net revenue requirements that are measured on a trailing twelve-month basis and a minimum cash requirement. See "Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” for more information regarding the Second Amended and Restated Credit Agreement and the credit facility.

Impact of Broader Economic Trends on Our Business

We continue to closely monitor economic uncertainty in the U.S. and abroad. General inflation in the U.S. rose in recent years to levels not experienced in recent decades. While the rate of inflation moderated in 2024, general inflation, including rising prices for our raw materials and other inputs, tariffs, as well as rising salaries and other expenses, can negatively impact our business by increasing our cost of sales and operating expenses. Inflation, together with uncertainty regarding future interest rate changes, and broader macroeconomic uncertainty, may cause our customers to reduce, delay, or cancel orders for our goods and services, thereby causing a decrease in or change in the timing of sales of our products and services. We cannot predict the impact of future inflation and interest rate changes on the results of our operations. Furthermore, changes to tariff and related international trade policy that began in 2025 has created uncertainty about the broader economy and our business. For further information regarding the impact of these economic factors on us, please see Item 1A., “Risk Factors” in this report, which is incorporated herein by reference.

Results of Operations

The following tables set forth our results of operations for the years ended December 31, 2025 and 2024 (dollars in thousands):

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Revenue

Our revenue disaggregated by product category, for the years ended December 31, 2025 and 2024 was as follows (dollars in thousands):

Total revenue was $40.5 million in 2025, an increase of $2.8 million, or 7.4%, compared with $37.7 million in 2024.

Lab Essentials revenue was $31.0 million in 2025, an increase of $2.2 million, or 7.5%, compared with $28.9 million in 2024. The increase in Lab Essentials revenue was attributable to an increased number of customers, partially offset by lower average revenue per customer.

Clinical Solutions revenue was $7.7 million in 2025, an increase of $0.6 million, or 7.8%, compared with $7.1 million in 2024. The increase in Clinical Solutions revenue was attributable to an increased number of customers, partially offset by lower average revenue per customer.

Our revenue disaggregated by geographic region, which is determined based on customer location, for the years ended December 31, 2025 and 2024, was as follows (dollars in thousands):

Revenue from sales to customers in the U.S. was $38.2 million in 2025, and $35.9 million in 2024. Revenue from U.S. sales was consistent year over year, representing 94.4% and 95.2% of our total revenue in 2025 and 2024, respectively.

Revenue from sales to customers in markets outside of the U.S. was $2.3 million in 2025, and $1.8 million in 2024. Revenue from international sales was also consistent year over year, representing 5.6% and 4.8% of our total revenue in 2025 and 2024, respectively. Revenue from sales to customers in markets outside of the U.S. was primarily derived from the United Kingdom, Canada, and Singapore in both 2025 and 2024.

Gross profit

Our gross profit for the years ended December 31, 2025 and 2024 was as follows (dollars in thousands):

Gross profit percentage was 33.2% in 2025, and 19.2% in 2024. The increase was primarily driven by $2.8 million of non-recurring and non-cash charges during 2024 related to the disposal of expired inventory and write

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down of excess inventory. Excluding those non-recurring and non-cash charges, gross profit would have been $10.0 million and gross profit percentage would have been 26.5%, respectively, in the year ended December 31, 2024. The improvement in gross profit percentage from 26.5% to 33.2% was primarily driven by higher revenue and manufacturing efficiency gains.

Operating expenses

Our operating expenses for the years ended December 31, 2025 and 2024 were as follows (dollars in thousands):

Research and development expenses were $2.2 mill

[Excerpt truncated for page length; the complete text is on the linked full-MD&A page.]