Harvard Bioscience (HBIO) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue declined 13.4% year-over-year to $22.0 million, reflecting lower demand in key segments and geographies, especially China/APAC, and continued softening from CROs and academic institutions.

• Gross margin remained stable at 58.1%, near the 60% target, despite lower revenue.

• Net loss widened to $(4.8) million GAAP, with adjusted net loss at $(1.1) million for the quarter; nine-month net loss was $(12.4) million.

• Major operational milestone: all U.S. operations migrated to a modern ERP system, improving supply chain and inventory management.

• Cost reduction actions implemented in Q3 and early Q4 are expected to reduce operating expenses by $1 million per quarter starting Q4.

Financial highlights

• Q3 2024 GAAP operating loss was $1.9 million; adjusted operating income was $0.8 million (3.8% margin), down from $1.8 million (7.3%) year-over-year.

• Adjusted EBITDA was $1.3 million (6.0% margin), down from $2.2 million (8.9%) last year.

• Cash flow used in operations was $(0.8) million in Q3 2024 and $(0.3) million for the nine months, compared to positive cash flow in 2023.

• Net debt as of September 30, 2024 was $33.8 million, up from $32.8 million at year-end 2023.

• GAAP loss per share was $(0.11); adjusted EPS was $(0.02) for Q3 2024.

Outlook and guidance

• Q4 2024 revenue expected between $23 million and $26 million; full-year 2024 revenue guidance at $93–$96 million.

• Q4 and full-year gross margin projected at 59–60%; Q4 adjusted EBITDA margin anticipated in the mid-teens, full-year in the high single digits.

• Sequential growth expected from new product adoption in telemetry, neurobehavior, bioproduction, and MeshMEA systems.

• Available cash and expected operating cash flow deemed sufficient for at least the next 12 months, but ongoing compliance with debt covenants depends on revenue and operating performance.