Standard BioTools Inc.

Good day and welcome to the Standard BioTools, Inc. First Quarter 2025 Financial Results Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad. And to withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to John Graziano, Vice President of Investor Relations. Please go ahead.

Thank you, Operator, and good afternoon, everyone. Welcome to the Standard BioTools, First Quarter 2025 Earnings Conference Call. Leading the call today is Michael Eggholm, President and Chief Executive Officer, and Alex Kim, Chief Financial Officer. At the close of Market Today, Standard BioTools released its financial results for the quarter ended March 31, 2025. During this call, we will review our results and provide an update on our financial and operational performance, 2025 outlook, market trends, and strategic initiatives. During the call, we will make forward-looking statements about events and circumstances that have not yet occurred, including plans and projections for our business, our outlook for 2025 and future financial results, market trends and opportunities, the impacts of tariffs and funding pressures, and our expectations related to the combined operations with Somalogic, including potential synergies, and our business outlook for the combined company. These statements are subject to substantial risks and uncertainties that may cause actual events or results to differ materially from current expectations. For information regarding other related risks, see the risk factors section of the company's annual report on Form 10-K filed with the SEC on March 11, 2025, and in the company's other filings with the SEC. The forward-looking statements on this call are based on information currently available to us, and we disclaim any obligation to update these statements except as may be required by law. During the call, we will also present some financial information on a non-GAAP basis. We believe these non-GAAP financial measures are useful in evaluating our core performance and as a baseline for assessing the future earnings potential of the company. We use these non-GAAP measures in our own evaluation of continuing operating performance. We encourage you to carefully consider our results on a GAAP and non-GAAP basis. The reconciliation between non-GAAP measures and their GAAP equivalents are provided in the tables accompanying today's press release and as an appendix to today's presentation slides. Please note that management will be referring to a slide presentation, including updated supplemental financial information within the webcast today. Following prepared remarks, we will host a Q&A session. Today's slide presentation, along with a replay of the webcast, will be available on the Investors section of our website. I would like to now turn the call over to Michael Eichholm, President and CEO of Standard Biotools. Thank you, John.

Good afternoon, everyone, and welcome to Standard Biotools' first quarter 2025 earnings call. Joining me today is Alex Kim, our Chief Financial Officer. Before we begin, I want to thank our customers, employees, and investors. Your support is what fuels our work and drives our mission to set a new standard of life for our businesses. Standard Biotools has been a key partner in our business. We have been able to develop and develop new technologies, improve our business practices, empower researchers, accelerate in discovery, all while delivering long-term value to our shareholders. Standard Biotools delivered a solid first quarter, which results unplanned and in line despite a choppy operating backdrop. Execution continues to improve as we build rigor across the organization, guided by lean principles through our Standard Biotools business system or just SPS. As operators, we're staying grounded in fundamentals, focusing on what we can control, managing with precision, and driving toward profitability. Before diving into the details, it's worth stepping back for a moment. While the broader environment remains dynamic, we're navigating it from a position of strength with a diversified portfolio, a disciplined operating model, healthy balance sheet, and a team that's getting sharper quarter after quarter as forecast accuracy improves and consistency in how we run the business growth. We are particularly pleased with our strategic foothold in proteomics and a series of recent high-impact product responses. Last week at the American Association of Cancer Research's annual meeting, or AACR, we announced a new Somerscan offering that will pair well with the highly anticipated distributed NGS-based Illumina partner solution. Together, these advancements expand our reach and push the boundaries of what's possible in translational and clinical research. From the outside, the macro-biopter may still cloud the picture, but inside we're strong. Our diversified business and life sciences allows us to operate multiple levels to navigate the waters, including a patient and disciplined M&A strategy, which is benefiting from a growing number of compelling assets and opportunities. With that, let's turn to the numbers. In Q1, while not growth, we executed to plan and delivered $40.8 million in revenue. This was down 10% -over-year as the market got worse against last year's Q1, and we had elevated backlog to start 2024. Despite this, and not enough to wave the All Clear flag, we have seen encouraging traction in capital expenditures, which strengthen our instrument business, which also helped by a favorable -over-year comp. Consumables and service revenue, which represents larger portions of the mix, particularly in the Americas, was softer than usual and still exhibits variability quarter to quarter. That said, when you zoom out at multi-quarter trend, you see a pattern of improving precision, sharpened commercial execution, and more consistency, which gives us confidence in the direction we are heading. While headwinds remain, and in some cases with NIA budgets and tariffs concerns intensified, our diversification continues to serve as well. International markets and biofarm engagement remain more resilient, and we are seeing continued traction across those segments. The impact is reflected in our previously announced guidance, which assumes a mid-teens percentage decline in America's academic revenue of roughly high single-digit million dollars at the midpoint. On the impact of new tariff measures, while they have added a layer of complexity and disruption to global trade, are from our perspective manageable. While not material to near-term financials, including the top line, we are actively accessing the operational impact and working across teams to mitigate risk and maintain flexibility. In some cases, we are passing costs through to customers, and others we are absorbing it but selectively. If fully absorbed, we estimate the impact on gross margin and adjusted EBITDA would be in the low single-digit millions, within the bounds of our current outlook, and consistent with what we communicated during our last quarterly update. Specifically, products manufactured in Canada and shipped to the USA falls under the US MCA and are currently excluded from tariffs. Products made in Singapore and shipped to the US, primarily our biomark instruments and IFC consumables, are now subject to a 10% tariff. SOMA scan kits made in the US and an area of growth, though a smaller portion of the revenue today, are subject to significant tariffs. For the full year, there is no change to our prior guidance. We continue to expect full year 2025 revenue in the range of $165 million to $175 million. We are taking a measured approach, modeling persistent headwinds, though anticipating back-house seasonality. With $261 million in cash and equivalents on the balance sheet and no material debt, we remain well capitalized and disciplined in our resource allocation. Our healthy cash position is a key asset and differentiator in this environment, and we intend to protect it accordingly. Our eyes remain fixed on reaching adjusted EBITDA positive in 2026, all while closely monitoring the backdrop in which we operate today. Being well capitalized is only part of the story, and we are taking decisive steps to streamline operations, reduce costs, and reinforce our operating leverage. Non-GAAP objects improved 22% year over year. Operating laws improved 45% and adjusted EBITDA improved 29%. Those results are the output of hard choices made early and implemented swiftly. In January, as previously announced, we executed an additional $10 million in cost reduction on top of the $80 million operationalized in 2024, primarily focused on long horizon R&D projects. Moves that enable us today to stay nimble without compromising near-term priorities were leaner, more agile, and structurally more efficient. We have made a lot of progress in this area, and we are now at a significant advantage as we move through 2025. What's making this level of discipline possible and sustainable is SPS. It's how we run the business. It brings a mindset of continuous improvement to everything we do and accountability to every part of the organization. Nowhere is an obscure diamond complex under leverage and overlooked, but we saw what others could not. In just over 12 months, we applied SPS, took out over $80 million in costs, and got the fundamentals right. We leveraged several high impact -to-head studies to reposition the technology and drive interest, ramped activity with leading biobanks, improved manufacturing, launched new products, and importantly reengaged our key partner, Illumina. This is a platform now positioned to win in large-scale population studies and drive translational and clinical research. That turnaround didn't happen by chance. It happened because we applied the SPS flywheel and moved with precision. The momentum is building around this uniquely powerful platform, high-plex, high-precision, and now backed by a more focused organization and data. Design speaks for itself. SoMaskan is unlocking entirely new possibilities in disease research and drug development like never before. With unmet scale and precision, that legacy antibody-based technology simply cannot match. We're seeing growing traction across pharma, biobanks, and large-scale population studies, and importantly, the data keep reinforcing the value and differentiation of the platform. Our deep partnership with Illumina is a critical part of this strategy, extending SoMaskan's reach to thousands of sequences worldwide and will bring high throughput proteomics to more researchers than ever before. This momentum was on full display at AACR where roughly 90 posters and presentations featured our solutions, underscoring the breadth and utility of the entire proteomics portfolio and its growing role in translational and clinical research. A couple of examples stood out. In a prostate cancer analysis conducted by the multicenter EPIC study, SoMaskan 7K identified over 50 protein markers, including PSA and many previously unknown markers, while in a comparable analysis, the nearest competitor found just one known biomarker, demonstrating SoMaskan's -in-class coverage and ability to uncover both known and novel biomarkers that have the potential to assess prostate cancer risk up to decades in advance of cancer diagnosis. More is really more in proteomics. In another study by Dejushanko and Astrocynica that stemmed from multiple phase two and phase three clinical trials, SoMaskan showed the potential to predict and monitor serious lung complications from cancer treatment. In this case, most commonly antibody drug conjugates or ADCs, detecting early warning signs up to 60 days before symptoms appeared and helping assess patient risk before treatment begins. At AACR, we also introduced three new offerings spanning consumables, instruments and services, single soma-mary agents, the Rytop XT Pro, a higher throughput flow system with part 11 compliant software for clinical trial researchers, and the SoMaskan 3.7K Select Assay. Collectively, they complement our category-leading 11K assay, and the Select 3.7K assay offers more usable content at higher precision than the nearest affinity proteomics competitors highest throughput offering, and improved economics. Purpose-built for translational clinical research and aligned with our mission to help farmers make better drugs faster. Turning to our products, our revenue mix for the quarter remained balanced across the portfolio, with consumables at 35%, instruments 19%, and lab and field services at 30% and 13%, respectively. We saw growth globally from our instrument business, while consumables and lab were soft, in part due to project timing and funding uncertainty in the Americas. Consumables, positioned at the top of our product pyramid, were down mid-teens year over year and down low single digits sequentially with the largest impact and flow. To help close that gap, we recently launched the XT Pro, a faster automated system purpose-built to drive pull-through. Early signals from the field have been encouraging. SoMaskan authorized sites, which have become a steady contributor to the consumables line, were down modestly year over year due to order timing in the US, though experiencing increased activity internationally, particularly in APAC. Looking ahead, we expect additional lift as our distributed solution with Illumina comes online. Consumables remain a strategic priority, high margin, recurring, and essential to our model long term. Instruments were a bright spot with double-digit year over year and a high throughput, led by continued demand for our Hyperion XTi spatial imaging systems. These are high throughput, high performance systems, and importantly, each placement builds install-based leverage for future consumable pull-through. Spatial proteomics, where the Hyperion XTi plays, was named 2024 Nature Method of the Year, a strong endorsement from the scientific community, and we're beginning to see that recognition translate into market adoption. Services were down mid-teams year over year, driven primarily by a decline in lab services. Beyond the elevated backlog referenced earlier, SoMaskan remains concentrated in a handful of large accounts, while less so today. Timing and variability are still expected and impacts quarterly performance. US academia also weighed on volume this quarter, though partially offset by increased pharma project activity and modest growth ex-US. Big picture, we're focused on making high-precision proteomics more accessible. As we expand distributed offerings through authorized sites and the Illumina partnership, we expect broader adoption and more consistent utilization of our service offering. This is a long-term growth market with solid fundamentals and we believe we are well-positioned to scale with it. At Stand-About Tools, we are building a durable, diversified life science tools platform grounded in operations and strategic consolidation. Our mission is to overcome the scale and profitability bottlenecks that have long held this sector back, to be the partner of choice for customers and innovators alike. And we're doing it with intention. A portfolio increasingly weighted toward high-market consumables, disciplined capital deployment and a flywheel that compounds value over time. With valuations under pressure and innovation accelerating, we're seeing real opportunities to continue to expand strategically. We're pursuing a highly disciplined approach, focused on diverse technologies with line of sight to commercialization and value creation, a strong margin profile and clear integration synergies. Every deal runs through the SPS playbook where we strip out inefficiencies, optimize operations and scale with speed. The bar remains high, but the pipeline is full and the opportunity set is compelling. We're playing the long game and we're doing it with a team of proven operators, a clear strategy and the resources to execute. With that, I'll turn the call over to Alex.

Thank you, Michael, and thank you all for joining our call today. I will walk us through our financial results in more detail and provide some additional context for the quarter. Please refer to today's press release and the appendix to our earnings deck for more information, including a reconciliation of gap to non-gap measures that I will be discussing here. Also note, we are no longer breaking out our financial results into proteomics and genomics. This reflects our evolving nature of our business where what we have previously labeled genomics, principally our microfluidics-based integrated fluidic circuits or IFC chips, is increasingly being applied across proteomics, sample preparation and liquid handling applications. We now view our overall business as offering a portfolio of multi-omic tools designed to provide customers with the best solution based on the problem they are trying to solve. We do not operate our -to-day business as two segments, and with our integration activities and operational synergies being realized, we are seeing more and more leverage of our resources across our product lines, including manufacturing, research and development, and sales and marketing. As a result, we believe it's more meaningful to look at our financials as one operating segment. We will, however, continue to break out sales into consumables, instruments, lab services and field services. So let's start with revenue on slide 12. Our first quarter revenue came in at $40.8 million. That's down 10% year over year and in line with our expectations. As Michael noted, we had a strong first quarter last year as we entered 2024 with an elevated backlog, the majority of which related to our SOMA Scan lab services business. Breaking revenue down further, consumables revenue was $14.5 million in the first quarter, down 16% compared to 2024. This was attributed to lower volumes impacted by lower America's academia revenue, as well as fewer large-scale clinical research projects in the quarter. Our SOMA Scan authorized sites continue to purchase our SOMA and therefore we believe distributed solutions including our partnership with Illumina will be a key step forward to establishing market leadership and proteomics. Expanding our ability to supply more sites globally is highly complimentary to our existing lab services business and strengthens our overall market position. Instruments revenue came in at $7.8 million in the first quarter, up 24% year over year compared to the first quarter of 2024. This was largely driven by continued sales traction in our spatial proteomics business, particularly the Hyperion XTI, building on the momentum seen exiting 2024. As our install base continues to grow, we expect this to drive consumables growth. Services revenue, which includes both lab services and field services, was $17.6 million in the first quarter, down 16% year over year compared to the first quarter of 2024. Lab services was down 19%, largely due to the previously mentioned gap in backlog. We did see some impact due to project timing and America's academia funding delays. Field services was down 11%, as anticipated, on fewer active service contracts as aged legacy instruments go off contract, and lower on-demand service and parts revenue on improved quality and uptime of our instruments. This is further evidence of the positive impact that we are having on our customers' experience. Moving on to gross margins on slide 13, our non-gap gross margins, which exclude depreciation, amortization, and stock-based compensation, was .2% in the first quarter of 2025 versus .2% in the first quarter of 2024. Our first quarter margins were particularly impacted by lower volume, lower price realization on services, and product mix. These masked strong improvements that we saw in operating efficiencies. Our SBS-driven activities to reduce waste and improve quality are evident across the organization, and we anticipate this to benefit gross margin expansion over the near and long term as volume returns. Moving on to operating expenses on slide 14, our non-gap operating expenses, which exclude merger-related costs, stock-based compensation, and restructuring charges, were $38.6 million in the first quarter of 2025, a decrease of $10.7 million, or down 22% compared to the same period in 2024. Sequentially, from the fourth quarter of 2024, we delivered a 10% reduction. In the first quarter, we operationalized an additional $10 million in annual run rate cost reductions, as we mentioned on our last call, as we delayed investments in a long-term R&D project. We are now totaling $90 million in annualized cost reductions since the merger with SOMA Logic, which is important to reiterate as we navigate through the current macroeconomic uncertainty. On slide 15, our net loss in the quarter was $26 million compared to a net loss of $32.2 million in the first quarter of 2024, representing an improvement of $6.2 million, or 19%. While adjusted EBITDA for the first quarter of 2025 was a loss of $16.9 million, versus an adjusted EBITDA loss of $23.7 million in the first quarter of 2024, an improvement of $6.8 million, or 29%. That brings me to cash on slide 16. We ended the first quarter with approximately $261 million in cash, cash equivalents, restricted cash, and short-term investments with no material debt. Our total cash burn was $34 million in the first quarter of 2025, versus $101 million in the first quarter of 2024. Our adjusted cash burn to support ongoing operations was $31 million in the first quarter of 2025, representing a 33% reduction versus $47 million in the first quarter of 2024. We are continuing to see material reductions in our cash burn coming through as a result of our restructuring efforts, the ongoing realization of merger cost energies, as well as operational improvements. We believe we are well positioned with our strategic plan and our balance sheet to support the growth of our business towards our profitability targets. As Michael said, we are not changing our full year revenue guidance of $165 to $175 million. We continue to expect the year to be back half-weighted based on our internal funnel metrics and not on any assumed recovery in the macro dynamics. We continue to expect the mid-teens percentage to decline in our America's academia revenue, a high single digit millions revenue impact versus 2024. In respect to our tariffs, a gross annualized impact is estimated to be in the low single digit millions of dollars to bound our exposure. We plan to pass these tariffs to our customers where possible, be mindful of market conditions and driving volume growth. Clearly, the geopolitical backdrop is currently highly volatile and stiff macro headwinds persist. However, as we stand here today, looking at the year ahead, we are well positioned, controlling what we can with multiple cost levels to pull on and deploy if needed and a robust balance sheet. We remain committed to delivering long-term profitable revenue growth and increasing shareholder value. Back to you, Michael.

Thanks, Alex. We thank you all for your continuous support as we navigate these dynamic end markets. We look forward to seeing many of you at upcoming conferences and stay tuned for details on our upcoming proteomics round table series where we'll dive deeper into the science, strategy and exciting opportunities ahead. And now I hand the call back to the operator for Q&A.

Thank you, and we will now begin the question and answer session. To ask a question, you may press star and then one on your touch-tone phone. If you are using a speaker phone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. And our first question today will come from Dan Brennan of TD Cowan. Please go ahead.

Hey, good afternoon, guys. This is Kyle on for Dan. Thanks for taking the questions. I wanted to start on the reiterated guide. You said nothing's really changed in your view in terms of the weighting of revenue this year, more back half-weighted. Understanding you guys don't guide quarterly, but I think the street's looking for revenue down a bit, jubil queue on one of the easiest comps of the year next quarter. That being said, I guess, how should we think about the percentage split between first half, second half?

I'll let Alex

answer that one.

And good to hear, Kyle.

Yeah, thanks, Kyle. We're not being overly specific on that, but as we look at our internal funnel, we do see some larger projects that'll hit in the back half of the year. So it's less the seasonality that you might have seen in the past, but more driven by our funnel metrics.

Got it. And maybe on the instrument demand, we're seeing a lot of demand this year. First quarter instrument number looks pretty good relative to our model at least. Anything you can share, I guess, on the funnel? Did you see any pull forward in the first quarter, maybe? I guess, how are you seeing your overall sales funnel going forward?

We're really, we're encouraged by the growth in our funnel primarily in the Hyperion XTI, but also some traction on our other instruments. And it's really all the good work we did last year in a difficult capex environment. So we saw some opening up at the markets at the end of the year. And so we carried that momentum into Q1. We haven't, on the instrument side, it's always a little bit hard to say whether it's a pull forward or not, but I can't think of any that was pulled forward here due to tariffs or other things. It may impact consumables a little bit, but again, not materially. And again, just in this choppy environment, we continue just to focus on where control last year when capex was tough, we kept focusing on just building the funnel, and we're now seeing some good traction, but not declaring victory yet.

Don, maybe if I can sneak in one more here on the M&A side, earlier this year, you targeted the 4.6 deals between this year and 2026. Clearly there have been many changes in the market since you initially laid out that goal. And on the call, it sounds like you guys have a pretty good funnel. Has anything changed in regards to your pipeline and the potential timing of any deals? Thank you.

Strategic M&A is part of our founding thesis. It remains a core part of the strategy in here. Alex and I, now four years into this adventure here, remain ever more convinced that there's a need for consolidating this space. And I think we have positioned ourselves and we have proven ourselves here. The market needs integration. We see, and we have built the funnel here over the last few years, and what we're seeing now, of course, with the macro and the funding environment and VC investment, it definitely offer up an increased number of opportunities that are actionable now at improved valuation in our point of view. Having said that, I wanna remind everybody that we are highly disciplined. We recognize that our healthy cash position, the key asset, differentiate on this environment. And so we intend to go after that set number of acquisitions here over the next 18 months, but the bar is high.

Got it, thanks guys.

And our next question today will come from Matt

Stanton of DeFries, please go ahead.

Hey, thanks. Maybe one just on US academic and government. You kind of baked a 15% or mid-team decline on the four-queue call. I think when we caught up then, you had said you hadn't seen any kind of a noticeable change in demand patterns at that time. Now that we've had a bit more time pass, and obviously the news flow there has remained dynamic, but just any more color kind of on how US academic progressed through one queue and any color on how it's trended here into two queue. Within that mid-team decline for the year, you'd baked in prior. Any more color, just a finer point in terms of what that bakes in, consumables and service versus the instrument piece there? Thank you.

Yeah,

hey Matt, good to hear you. We were like surgical in how we called it out at our last earnings call, and that's the sort of high-level guidance that we made. It's more than I remind everybody that we were coming into the year expecting healthy growth in the Americas. So the 15% is still what our mid-teens is still what we're seeing. We've seen, because we've been advised by some institutions that have committed to buying instruments this year that they don't know if they'll be able to do it. We have seen some delay in consumables orders. Whether those are permanent, we don't know. And we have seen at the recent AACR conference a number of customers from academia could not travel because they were basically curbing all nonsense and expenditures, so the sort of broad impact of less fund in US academia definitely holds. I think we sort of pegged it about right from where we're sitting now, and therefore we're maintaining the guidance. Okay, great, that's helpful. Maybe, yeah, sorry, I forgot, like the little piece of instruments, so we've seen so many instruments we shipped here were in US academia, typically with private funding. We obviously hope NIH budget will be released and funding will come through for the various grants for all the good stuff we have in the pipeline.

Or funding, I should say. Okay, great, thanks. And then we'll move to some of the new products. A handful of new launches last week. Just to focus on the single SOMA reagents, any kind of early feedback or demand now that you get those out the door, and can you just remind us on the commercial model there, how much of the existing SOMA menu will be available for the single SOMA MERS, and then any workflows or customers you expect this to resonate strongly with, thanks.

Yeah, so we were in what we call an early access and minimal viable products up until now, and now we've made it fully available. We are initially addressing a couple of applications. One is as more and more resources will use SOMA scan, they will find a number of, identify a number of proteins, a very large number, as I just referenced in my script. And one of the first things you will wanna do is to do a pull down with those, and then analyze by mass spec, confirming post-translation modification, et cetera. So we see that as one avenue. And then we believe there's a broader reagent market where antibodies are really limited, where we have 11,000 fully synthetic monoclonal reagents binding to human proteins. We believe that's a valuable tool set, and we believe it's a very nice compliment to the antibody market. As for how we're going about it, it's a new capability. We have not sold individual reagents before, so I would not have high expectations in the short term, but in the long term, as we're figuring out how to sell this, we see this as a fairly significant

opportunity. Thank

you. Again, if you would like to ask a question, please

press star and then one. Our next question will come from Paul Knight of KeyBank. Please go ahead.

Michael, are you expecting the Illumina partnership to generate significant revenue in 2025?

Yeah, hey, Paul. We're very excited about the upcoming launch, as we talked about at JPM, at our last earnest call, with the mounting evidence that we are uniquely positioned to clinical research and insights, most recently at AACR, that you can see now, Illumina making this available to thousands of labs with sequences. We cautious for 25, but long term see this as a very strong value driver. Illumina is responsible for the sales marketing and support, and we have all the faith in the world that they will do a brilliant job. And this is new for them, and this always takes longer than one want. But the outlook is really bright for the technology. Maybe, Alex, you can just comment on what's baked into our 25 assumptions there.

Yeah, maybe just to remind you, in 2024, we had some good revenue from Illumina that came through for development, to support their development, as well as their early access customers. So year over year, it'll be moderate growth on top of that, but not for many of the reasons Michael mentioned, not a significant growth overall. And that is baked into our current guidance. And as Michael mentioned, 26 and beyond, we expect to begin to see strong traction and strong growth there.

And then, of course, I know academics challenging, but can you talk about what you're seeing within the biopharmaceutical customer set? It does seem like we've started the year with a more visible spending trend there. Are you seeing a better market condition for the major biopharma part of the market?

Good traction in pharma here in Q1, and have not seen a change from that as I'm sitting here today. Our numbers get a little bit obscured by our historical dependence on a few large customers. As I said in the script, it's becoming ever less so, but it still leads to quarter to quarter value. And then, we're seeing a lot of variation. So underneath that, we're actually seeing a healthy growth and funnel beyond those accounts and in our authorized sites.

Okay, and then last is the $10 million cost action in early January. Should we think about an improved outlook for EBITDA loss this year?

I'll let Alex handle that. Yeah, slightly. So the action was late January, 10 million annualized. And so, yes, you will see that flow through our approach, as Michael has said many times, is continuous improvement. And so, you'll see us continue to improve our adjusted EBITDA.

Thank you.

Ladies and gentlemen, at this time,

we will conclude our question and answer session and also conclude the standard bio to this conference call. Thank you for attending today's presentation and you may now disconnect your lines.