Yes. My name is Mike Ryskin. I'm on the Bank of America Life Science Tools and Diagnostics team. We're excited to be joined by Bio-Techne. We're pleased to host Kim Kelderman, Chief Executive Officer, and Jim Hippel, Chief Financial Officer. Kim, Jim, thanks for being here. Thanks for having us. The forum will be a fireside chat. Raise your hand if you've got a burning question. I mean, maybe just to kick things off, you recently reported. Any highlights from the quarter you'd like to talk through, sort of how it played out relative to expectations, you know, what was a little bit better, what was a little bit worse? We reported our Q3 and printed - 2% growth for the quarter, and that was over a prior- year quarter of about 6% growth. Couple of dynamics in there that we'll definitely double-click on. In a quarter like that, you always wanna look back and ask yourself, do you have the right strategy, and is it rolling out in the right, in the right pace? There I've been pleased to see that, as you know, our strategy is around having a really broad core that reads on many different end markets, that gives us the leverage to pick specific fast-growing vertical markets where we can build out full solutions in specific application spaces. For us, that's cell therapy, it's protein analytics, and it's spatial biology. If I then walk through what happened in the core, negative mid-single digits, but we have talked about a timing issue with a specific large order that moved from Q3 to Q2. Take that into consideration, we saw that the most important product lines in the core, proteins and antibodies, were actually growing low single digits, and with that, are holding with or actually grow a little bit faster than market. That's a good sign. There we have the first growth vertical, cell and gene therapy, where we had some dynamics from large customers that got a Fast Track approval and are not ordering this year. Underlying, that was growing 50%, that's also what we like to see in that vertical market. The protein analysis, mid-single- digit growth. Again, positive growth for the instrumentation as well. This market has, of course, one read, strong read on biotech markets where I will get to in a minute. Last but not least, our s patial biology franchise, that grew mid-teens, that's also where I would like to see this business. Overall, the strategic aspects of our business were rolling out as we like them to see. There's no question, however, that every one of those product lines saw a suppressed biotech, early stage biotech, demand. The nice thing is that we saw that across the board, so we know that it is a very specific dynamic to the early stage biotech end markets. Yeah, that was not how we expected it, because if you think about large pharma, has been very strong for us, which is usually an early indicator for health in biotech as well. That wasn't the case. In the meantime, we had seen two really strong funding quarters for biotech, and that would also give us the indication that things would slowly go better. We had two mid-single digits negative quarters in Q1, Q2 in biotech, indicating a sort of stabilization. It was not unreasonable for us to think that a continued stabilization and then possibly followed by some improvement would be the right direction and trajectory for that end market. That's not how it played out, unfortunately. Fortunately, all the indicators for the end market are still very positive. If you go to the academic end markets, there it exactly played out as we thought, where we had two stabilization quarters of negative low single digits. We had some positive news, and there we flipped into the positive growth led by instrumentation. The last end market that we called and talk about is China, where over a year ago we saw stabilization, and then we called that we would be back into the positive growth territory, and that also happened. This last quarter we printed for the fourth time a positive quarter. Last but not least, our bottom line, 34.2% on EBITDA, exactly in line with how we saw that and called it, and probably a little bit ahead of where the Street has. That's the dynamics for the quarter. Okay. That's great. I'm gonna follow up on each of those in turn. Yeah. Maybe let's start with emerging biotech. You know, you talked about it, you know, a little bit surprisingly weaker in fiscal Q3. Why do you think that happened, given you saw stabilization the last couple of quarters, given funding has been better, given the indicators are still strong? Is this a timing dynamic? Is there some sort of disconnect between funding and spending? Just sort of, why was it so disappointing? Yeah, it's a very good question. It is really the underlying dynamics of the funding. It has been clear that IPOs, M&A, lots of activity in the biotech end market, but very much skewed to the later- stage projects and companies that have assets that are closer to commercialization. That eventually, of course, trickles into other programs, earlier stage, where these companies would broaden their portfolio. Initially, the funding is really focused on boosting the late stage programs. That, we can clearly see that in, for example, our biologics instrumentation, where, you know, you are supporting manufacturing and commercialization of these later- stage therapies. You see double- digit growth for us there. The overall research activity has been actually lagging in recovery. There was a nice write-up from Evercore this morning where there was more dynamics underneath being studied and very much in line with how we experienced the quarter and the recovery. Okay. Nonetheless, all, as I mentioned, you already said the funding has been very strong. I mentioned the licensing deals and the M&A activity. All of it are very strong indicators for improved dynamics, and therefore we're very confident that this sets us up really nicely for fiscal 2027. Okay. You think it's just a matter of time, and you just need more and more quarters of consistent stability and then those biotechs will work to replenish the pipeline? Exactly, yes. It will flow into earlier stage. It will stabilize for us, and then it will highly likely improve significantly, specifically based upon those indicators I just mentioned. Okay. Maybe let's talk about large pharma for a second. That's been doing a lot better. Is that, you know, a normalization post MFN? Is that more confidence in policy and regulatory? Is that, you know, maybe portfolio specific and technology specific, sort of like what's driving the strength there? Yeah, you mentioned the important dynamics. The budgets in R&D for the large pharma companies is in the mid-single digits, and that's where we would like it to be. It's actually increased a little bit year-over-year, but that's all we need from a funding level point of view. As I mentioned earlier, our strategy of having broad access from a core portfolio, but also having these growth verticals that are very applicable in large pharma, driving our growth and creating pull-through of our high- margin core reagents. That is the setup that we've seen now for six quarters in a row, giving us a double-digit performance in that end market. Now, we layer on in the future additional traction from onshoring, as well as from AI, where the initial steps are all about getting more instrumentation and with that more digital information for AI models. You would like to have highly characterized, high- quality reagents to have reproducible results as well. Therefore we feel that our whole portfolio is very nicely aligned with the trends within large pharma. Okay. Let's keep on going with the end markets. On academic and government, you kind of talked through that's more or less as expected as you thought. Can you parse out maybe U.S. versus OUS, the trends you're seeing there? We've seen really varying results from a number of your tools, peers, so it seems like things are a little bit murky there. You know, has visibility improved? Yeah. Overall, we have 22% of our revenues coming out of pharma globally, 10% coming out of— Academic. Oh. Academic. Did I say pharma? Sorry. Academic. Ten percent of that comes out of Europe academic. Europe academic has been very stable and there's definitely signs of improvement that we hear from the funding level, but has been stable for us. It's been the 12% that comes from the U.S. that has been challenged under the last couple of quarters. Definitely improved picture though. We can clearly see an improvement in the type of grants that are being released, very much aligned with our research portfolio and our verticals. The grants are more in chronic disease versus the infectious diseases. On top of that, we see that there are that there's more traction in certain grants where if customers get these grants, you will start with buying equipment that will help you in the methods that you will need to utilize during the grant. You see traction in our protein analysis, you see traction in our spatial biology and cell therapy verticals, exactly in line with our strategy. We can see a nice initiation of heightened activity and that's in line with our expectations. As I said, we had stabilization for two quarters and now we have flipped into the positive growth for the academic U.S. market. Yeah. You know, are the grants already being dispersed? Are scientists spending the money? Is there still any caution? 'Cause we've gotten mixed signals there. Maybe they're still a little bit worried that, you know, you could have another another round of fewer disbursements or fewer grants being granted. Yeah. Overall, there's been quite some dynamics in that end market, right? We had a government shutdown for a while. Combine that with, yes, we had an approved budget, which was great news, with a slight increase on it, there were grants being held back and all these dynamics made it a little bit murkier. On the bottom line, we can now see that grants are being released. We've seen that the right grants are being released if you talk from a Bio-Techne point of view. We can also see that there's traction in the growth verticals or the basically the technologies that are on the forefront of research that academics would be interested in the moment you get funding. All of that actually makes a lot of sense if you take all the noise out. Okay. Okay. You touched on China as giving you broadly positive indicators and moving in the right direction. Is there anything, you know, anything you could expand on that? Is it more on the local biotechs? Is it multinationals there? More, more generics branded, sort of like where, you know, CDMOs, CROs. What parts of China are you seeing better trends from? We're very excited about the fact that it's a very broad-based recovery, right? We see, of course, government funding is important, and they have approved their 15th five-year budget, and that creates a certain foundational health. Also, life science tools are still very high on the agenda of to be funded and supported aspects of the Chinese economy. Those are fundamentally good things. In the meantime, you can also clearly see a heightened activity level on biotech and pharma if you look at the novel therapies being developed. The model there is interesting because many of these companies create novel therapeutics that they then take the rights for for the China market, right? They can create a model where they serve the Chinese market, but out-license for Western for the Western world. That created a dynamic where that end market became much more fundable and could attract local as well as international money. Therefore, you see a definitely a heightened activity level and quite some successes over the last two quarters when it comes to licensing to Western companies. A very broad-based recovery. Four quarters ago, we said it would be back in the black, but we also said it wouldn't be a V shape, that it would be very foundationally coming up from a core strength rather than a jolt of funding, which happened to be the case over the last two years. A more foundational strength. We're really happy to see that. Yeah. Is there any talk of government stimulus or government support, or does this feel more organic and actual sort of driven by real demand? Right. There's, as I mentioned, the broad support from the government with a five-year plan of funding, and that's foundational and foundationally important. The activity level comes from several corners, private as well as government institutions and very broad-based. From pharma to biotech, early-stage biotech and academics. Very healthy rebound. Okay. All right. Let's dive into some of the segments and sub-segment results. You know, you talked about cell and gene therapy, some of the moving pieces there in the quarter. More broadly, can you talk about your solutions in cell and gene therapy and sort of how that's been received by the market, what the uptake of that has been? Yeah. The cell therapy is a important strategic pillar for us. We are really focused on having very efficient, scalable, and affordable cell therapy solutions, and that's what we're working towards. We had real nice traction. If you look at our overall portfolio of customers, we've seen a low single digits growth in the customers. Over the last year, we saw some turnover with companies moving out of cell therapy and some others moving in and coming up with better solutions, better therapies. We see a healthening of the pipeline, while it's still growing. Yes, we've talked over the last four quarters or so about the dynamics of two large customers that's received FDA Fast Track designation. That's great news because that will shorten their time to approval. However, it created a air pocket for us if it comes to the revenue throughout fiscal 2027. In 2028, we'll be Sorry, 2026. In 2027, we will be past that. That created a dynamic that, you know, influenced the top- line results. If you look underneath those two accounts, we can see clearly that there is a mid-single- digit, high single- digit growth underneath, which is definitely where we expect it to be. With a recovery in biotech, we definitely believe that the underlying growth should be above 20% on a 12 trailing- month basis. We have, we've this quarter seen 50% growth. That's definitely something that we continue to expect from the underlying business. Are there any other sort of implications or ramifications of those Fast Track designations? Is there You know, have you seen a pickup in interest from other customers? Is there more investment in the space, maybe as some others see, you know, the opportunity here and the, you know, the easier path to commercialization? It's a very interesting question because, yes, of course, this is a very positive aspect for the two companies that have received this designation if it comes to working together with the FDA and shortening their timelines for approval. With that, of course, plowing some snow for others to follow a similar path, especially since several of these therapies are relatively novel for the FDA and the reviewers. That is a good aspect and will bolster the confidence of others to enter. Now, in general also, people see that, hey, there is a definite interest by the administration for specific therapies. We have seen, let's call them fast followers, other companies that feel that, hey, this is very investable. We should do something similar, maybe slightly different, but at the end of the day, enter the same space and develop similar therapies for these very prevalent diseases. Therefore, there is a little bit of a Comet Halley effect. Okay. You still have that air pocket, just arithmetic of— Correct. Demand being pulled forward. Yeah. It was a 300 basis points air pocket for Q3, and will be 150 basis points for our upcoming Q4, and from there it will be out of our comparables. Okay. Okay. Maybe on that point, let's dive into the numbers a little bit. Jim, maybe you could talk us through sort of the, you know, the implied 4Q or the, you know, the 4Q guide. What are the moving pieces there? Jumping off into next fiscal year, any points, you know, we just touched on the air pocket, but any other dynamics we should keep in mind as we look to next year? Sure. Yeah, as we think about Q4, the guidance we gave on the earnings call was essentially a flat quarter year-over-year, which again, taking the 150 basis points headwind into account for these two Fast Track customers implies underlying growth or a jump-off point for fiscal 2027 of a positive 2% or so, which is very similar to what our Q3 performance was. If you take the 400 basis points, 300 basis points from these two Fast Track, 100 basis points from this OEM timing, and put that into play, it's basically saying the same kind of underlying growth. You know, at the end of the day, pharma's already performing very well. We still don't see any reason why that doesn't continue in both the near and intermediate and longer term. Academic is stabilizing and for us gradually improving. We think that as Kim outlined, it'll be a gradual process, but nonetheless going in the right direction, we kind of see that continuing. Of course, biotech is really the big swing factor, it has been, as to when this funding turns into spending. As Kim alluded to, there's all kinds of as you dive deeper into the funding detail, it points to, you know, a one-quarter lag for emerging versus the overall biotech in terms of when the funding really started to come in. Whether it's the very end of Q4 or whether that's the start of our fiscal 2027, it's like trying to, you know, thread a needle. Nonetheless, it does appear like it's on the horizon sooner than, you know, more sooner than later. It's not a matter of if, it's a matter of when, as long as the funding continues in the right direction. You know, we've said that, hey, we're not gonna try to thread this needle any more by quarter. We're assuming that our Q4 is very similar to our Q3 even for biotech. Either way, it sets us up for a very nice jump-off point as we think about fiscal 2027. 'Cause if you think about +2 as being the jump-off point, you know, biotech going from high single-digit declines just to flat gives you a couple extra points. It's over 20% of our revenue. Just that dynamic alone would suggest a nice step up. Of course, you got the dynamic of easier comps in general, definitely in biotech as well as academic. It, you know, generally improving markets for both academic and in Asia. It, you know, setting up for a nice I think recovery or start to recovery in fiscal year 2027. We're, you know, I think we're very pleased with our relative positioning going into fiscal year 2027. Okay. I mean, it sounds like you're generally more constructive on most of these factors, but still some uncertainty and some unevenness. Is visibility broadly getting better, or is it still, you know, a little bit challenged with some of these, you know, swing factors? Yeah. Things like biotech that seem to be edgy? I mean, you know, you have to always say being a very highly consumable-based business as we are, it's, you know, it's a, it's a blessing and a curse sometimes, right? It's a blessing because of the great recurring nature of it. It's a curse from a forecasting perspective sometimes because the book and ship all happens within a day or two. You really got to look at momentum and external factors and try to calibrate all that. I'd say where it is encouraging in terms of the biotech funding starting to turn into spending sooner than later is where we're seeing some increased activity with our customers that require longer funnel building and longer lead times, and that would be in our instrument portfolios, both in our proteomic instruments, but also in our spatial. We're hearing from the field that for the first time in quite a while, the interest level from biotech customers are starting to pick up there. The funnel's actually starting to build. Again, that bodes well maybe not for Q4, but, you know, as we start to fiscal year 2027, that's a very good sign that we're seeing actually in the field right now with regards to our biotech customers. We saw that same dynamic, by the way, play out in U.S. academic. Yes, we grew low single-digit in academic. That growth was actually driven, believe it or not, by our proteomic instrumentation and our spatial instrumentation. We've always said that when we see markets start to turn, we often see it in those two areas first because They're high- growth areas. They're tools that are in high demand by our customers. You can tell that by the consumables usage. Like for example, protein analytics has the cartridges. We have not had a down quarter in consumables since COVID for our instruments. They're using the heck out of our instruments, and it makes sense that when the money starts to become available, that's one of the first places they'll start to spend it. Okay. Okay. Kim, something you touched on earlier, AI and sort of how that's factoring into conversations, have to touch on that. Just, you know, how prominent is that in your conversations with your pharma and biotech customers in terms of, you know, AI applications, in research and discovery, and sort of how you can fit into that narrative? It's certainly on the forefront of many of the discussions. We believe that eventually it will increase the efficiency of the development work and therewith allows for a broader portfolio and more projects that can efficiently move forward to a commercial drug. Increase of the pipeline, bottom line. Short term, you can clearly see that customers would like to make sure that they can use their data for building their models, and therefore, automation is on the forefront of their minds. Of course, our protein analytics platforms, all three of them help you creating digital information on your biological instruments, sorry, biological experiments. Our COMET instrument very much aligned with doing large experiments as well. If you think about the data you generate, you would like to have reproducible data using high-quality reagents where there are many publications, as well as a good characterization data around those reagents. That's exactly what we've built over the last 50 years, taking every reagent that we launch, very serious, highly characterized, and over the many decades published from all angles. We do believe that we have a very strong competitive advantage in that environment. To validate it all, we've done a survey of over 100 of our customers, 140 or so, to see how and where they are in their adoption cycles, what their needs will be, and very much validated the storyline I just elaborated on. We're very confident that we're in the right spot with the right sense of urgency, with the right direction. Okay. I mean, trends you're talking about in terms of reproducible data, high- quality data, high- quality reagents, automation, more high- content screening, high- throughput screening, that's stuff that pharma's been doing for 10, 20, 30 years, right? It's been a trend, a move in this direction. Has there been a real step function change in the last like six months, 12 months, where it's taken another leg higher, where you can see sort of like, okay, this is when pharma started using AI, boom, they're doing a lot more high- throughput screening, they're doing a lot more automation? Is it still more gradual? Is it still to come? You know, are they still experimenting with these workflows, these protocols, is it already kind of being implemented? Yeah, it's a good question. At the end of the day, I would have to say that in general, the adoption has definitely increased over the last year. You can imagine with the rhetoric and the drive, top down, in a company to be in the forefront, there is definitely a step- up. You're also right in saying that many of them have already been adopting the large language models for several years. With that, you can conclude that not everybody is at the same stage, right? You'll see a bell curve. You have the fast movers, where, they're already building models and starting using the data, and others are right on time and started putting it in gear over the last year and you'll see laggers. Overall though, the trend is undeniable that we will see this bell curve moving through our customers and their demand and the type of products they would like to have. The pharma that's already adopting this and that's sort of further along on the curve, what are you seeing from them in terms of like spend levels overall? Are they spending more money total, or are they spending the same amount of money but shifting it around in terms of baskets, how they're doing R&D? Like what are the early earnings in terms of how they're implementing it? 'Cause there's a lot of debate of, you can make an argument that, you know, Bio-Techne and tools in general are beneficiaries here. You could argue that it's a detriment to the space, sort of like, you know, it's hard to tell where the overall dollar amount will go. The overall view is that, it will be beneficial, right? I think [inaudible] there's now enough data where you don't have to do the exact same volume. [inaudible] Underlying is a very strong [inaudible], and a strategy that is even in tougher end markets holding up. I mentioned in my opening statement, we have strengthened our core businesses and definitely grow in the verticals we talk about, where we have best solutions, and we can generate disproportionate growth by putting through disproportionate high- margin reagents. The setup works very nicely, and I'm very confident that we can be able to further demonstrate the strategic advantage. Yeah. That sounds great. We're gonna leave it there. Thanks, everyone, for joining. Kim, Jim, thank you so much for being here. Appreciate your time.