Twist Bioscience (TWST) Q3 Revenue Jumps 23%, FY Guidance Raised

Twist Bioscience (NASDAQ: TWST), a leading company in synthetic biology, showcased robust growth in its fiscal third quarter of 2026 financial results. The company's total revenue surged by 23% year-over-year to a record $118.4 million. This achievement marks Twist Bioscience's fourteenth consecutive quarter of sequential revenue growth, underscoring its sustained expansion trajectory.

For the quarter ended June 30, 2026, the company's DNA Synthesis and Protein Solutions (DSPS) segment revenue climbed 39% year-over-year to $56.6 million. The Next-Generation Sequencing (NGS) Applications segment also contributed significantly, reporting $61.8 million in revenue, a 12% increase. The gross margin improved sequentially by 120 basis points to 52.8%. However, the company reported a net loss of $35.1 million, a decrease compared to the net income of $20.4 million in the prior fiscal year's third quarter, which notably included a $48.8 million gain from the spin-out of Atlas Data Storage. Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) stood at a loss of $11.3 million.

Dr. Emily M. Leproust, CEO and co-founder of Twist Bioscience, emphasized the company's consistent pattern of strong growth, exceeding guidance with record revenues. Dr. Leproust expressed confidence in achieving adjusted EBITDA breakeven in the fiscal fourth quarter, stating that this milestone would serve as a foundation for disciplined execution and profitable growth into fiscal year 2027. The company also recently strengthened its capital position through a $300 million follow-on common stock offering at $96 per share in early August and moved to resolve legacy securities litigation with a proposed $17.05 million class-action settlement.

The company's decision to raise its fiscal year 2026 revenue guidance by $12 million at the midpoint to a range of $456-$457 million was well-received. This revised outlook implies approximately 21% annual growth. For the fourth quarter, Twist Bioscience anticipates revenue between $123 million and $124 million and reiterated its target for adjusted EBITDA breakeven. Despite the robust revenue growth, the company's shares experienced a 7.7% decline in premarket trading following the earnings report, as investors reacted to a wider-than-expected adjusted loss compared to analyst consensus. This indicates that while top-line growth is strong, the market is seeking clearer signs of sustainable profitability.

Increasing demand in innovative areas such as AI-enabled drug discovery within the biotechnology sector is a key driver of Twist Bioscience's momentum. The company highlighted that AI-enabled drug discovery orders are fueling triple-digit growth, with pharmaceutical and technology firms utilizing its platform for iterative design and testing cycles. This trend underscores the growing importance of synthetic biology in drug development processes and solidifies the company's position in this evolving landscape. As of June 30, 2026, Twist Bioscience held approximately $167 million in cash, cash equivalents, and short-term investments.

Analysts and market observers are closely monitoring Twist Bioscience's ability to maintain revenue growth and improve gross margins. Looking ahead, the company's goal of achieving adjusted EBITDA breakeven in the fiscal fourth quarter is considered a critical step in its path to profitability. Management's commitment to disciplined expense management and operational efficiency improvements will be a significant indicator for long-term investors. The scalability of the company's synthetic DNA platform and its potential to evolve into a broader business model are key factors that will determine its future value creation capabilities.