Bio-Rad Laboratories Inc (BIO) — Q2 2025 Earnings Call Transcript

Good afternoon, everyone, and thank you for joining us. Today, we will review the second quarter 2025 financial results and share updates on key business trends for Bio-Rad. On the call today are Norman Schwartz, our Chief Executive Officer; Jon DiVincenzo, President and Chief Operating Officer; and Roop Lakkaraju, Executive Vice President and Chief Financial Officer. Before we start, I want to remind everyone that we will be making forward-looking statements about management's goals, plans, and expectations, our future financial performance, and other matters. These statements are based on assumptions and expectations of future events that carry risks and uncertainties. Our actual results may differ significantly from these plans, goals, and expectations. You should not rely too heavily on these forward-looking statements, and I encourage you to review our filings with the SEC, which detail the risk factors in our business. The company does not plan to update any forward-looking statements made during this call. Additionally, our remarks will include references to non-GAAP financials, such as net income and diluted earnings per share, which are not defined under generally accepted accounting principles. Along with excluding certain atypical and nonrecurring items, our non-GAAP financial measures also exclude changes in the equity value of our stake in Sartorius AG to provide investors with a clearer view of Bio-Rad's core operational performance. Investors should review the reconciliation of these non-GAAP measures to the corresponding GAAP results in our earnings release. We have also posted a supplemental earnings presentation in the Investor Relations section of our website for your reference. Now, I will turn the call over to our Chief Operating Officer, Jon DiVincenzo.

Thank you, Ed. Good afternoon, everyone, and thank you for joining us today. We are pleased to share our second quarter 2025 results, which reflect solid execution across the business. Both revenue and operating margin exceeded consensus expectations, underscoring the strength of our portfolio and the discipline of our teams in a challenging and rapidly evolving macroeconomic environment. Our Clinical Diagnostics business remained stable, while our Life Science segment benefited from the strength in our process chromatography portfolio. Product mix and a continued focus on cost control and discretionary spending helped drive an outperformance in operating margin for the quarter. While we continue to face headwinds in the academic market due to constrained government funding, we saw signs of stabilization, particularly in consumables. This resilience highlights the enduring demand for our differentiated assays and reagents, including Droplet Digital PCR consumables, which saw high single-digit revenue growth versus 2024. The second quarter was a busy one for our ddPCR team as we completed the development of the QX Continuum platform and successfully closed the acquisition of Stilla Technologies, adding new platforms and a fantastic team of colleagues to Bio-Rad. Synchronized with the closing of the Stilla acquisition, we launched the rebranded QX700 Series ddPCR instruments. The combination of the QX Continuum and QX700 Series products are positioned to expand our Droplet Digital PCR portfolio for customers requiring a simplified workflow and flexibility at various budget levels. Although it is early, customer feedback has been very positive. We look forward to showcasing these innovations at the upcoming ddPCR World Conference in Seoul, Korea this September, along with a series of satellite events across APAC, EMEA and the Americas. Also during the quarter, several of our key ddPCR partners made progress in bringing this technology to the diagnostic market. Incyte Molecular Diagnostics, formerly OncoCyte, announced positive clinical data for its assay in kidney transplant monitoring. We are supporting its path toward FDA approval in 2026 and the development of a kitted IVD solution, an exciting advancement for the transplant community. Genoscopy advanced its ColoSense colon cancer screening test, which is powered by our ddPCR technology. The assay was recently included in the National Comprehensive Cancer Network guidelines, a critical enabler for clinical adoption and reimbursement. We're encouraged with their progress and the potential of ColoSense. Operationally, our teams continue to drive improvements through strong execution of lean initiatives, careful cost management and actions to actively mitigate tariff impacts. In Diagnostics, strength outside of China helped offset local reimbursement pressures, resulting in 3.7% growth in our rest of world markets. In China, volume-based procurement or VBP has not impacted our portfolio. Beyond the previously noted diabetes testing reimbursement reductions, we haven't faced any new reimbursement challenges. While we factored headwinds from the recent diagnosis-related group or DRG policy changes affecting diagnostic panels into our first quarter guidance, the impact was not significant in the second quarter. Our local team continues to diligently monitor the evolving landscape of Chinese government policies. And finally, I'm excited to welcome Rajat Mehta as Bio-Rad's new Executive Vice President of Global Commercial Operations. Rajat brings deep experience across diagnostics and life sciences, most recently leading a large regional diagnostics division of Labcorp. He has lived and worked globally and brings expertise in commercial transformation, digital innovation and customer-centric strategies. Rajat succeeds Mike Crowley, who is retiring after a remarkable 26-year career with Bio-Rad. I have enjoyed working with Mike during my first year and personally thank him for his support. We all wish Mike all the best in his retirement. So thank you again for your continued support. I'll hand the call over to Roop for a detailed review of our financial results.

Thank you, Jon, and good afternoon. I'd like to start with a review of the second quarter 2025 results. Overall, we executed well during the quarter. Net sales for the second quarter of 2025 were approximately $652 million, which represents a 2.1% increase on a reported basis versus $638 million in Q2 of 2024. On a currency-neutral basis, this represents a 1% year-over-year increase and was primarily driven by sales of our process chromatography products. Sales of the Life Sciences Group in the second quarter of 2025 were $263 million compared to $251 million in Q2 of 2024, which is an increase of 4.9% on a reported basis and 3.8% on a currency-neutral basis, primarily driven by the increase in process chromatography and food safety product sales. Currency-neutral sales increased in the Americas and EMEA, partially offset by decreased sales in Asia Pacific. Our process chromatography business experienced strong double-digit growth on a year-over-year basis due to orders pulled into the second quarter by customers. The orders represented approximately 20% of the quarter's process chromatography sales. Zooming out of the second quarter results, we now expect low double-digit growth for this product area in 2025 versus our prior high single-digit growth outlook. Excluding process chromatography sales, our core Life Science Group revenue decreased 1.7% year-over-year and 2.7% on a currency-neutral basis, reflecting ongoing softness in the biotech and academic research market, which affects instrument demand. Sales of the Clinical Diagnostics Group in the second quarter of 2025 were approximately $389 million compared to $388 million in Q2 of 2024, essentially flat on a reported basis and a decrease of 0.7% on a currency-neutral basis. The decrease is because of the previously discussed lower reimbursement rate for diabetes testing in China, partially offset by increased demand for our quality control and immunology products. On a geographic basis, currency-neutral sales decreased in Asia Pacific, partially offset by increased sales in EMEA and the Americas. Q2 reported gross margin was 53% as compared to 55.6% in the second quarter of 2024. On a non-GAAP basis, second quarter gross margin was 53.7% versus 56.4% in the year-ago period. The decrease in non-GAAP gross margin was due to higher material costs and reduced fixed manufacturing absorption because of lower instrument demand. SG&A expense for the second quarter of 2025 was $208 million or 31.9% of sales compared to $195 million or 30.5% in Q2 of 2024. Second quarter non-GAAP SG&A spend was $201 million versus $194 million in the year-ago period. The year-over-year increase in non-GAAP SG&A expense was primarily due to higher variable compensation costs. Research and development expense in the second quarter on a GAAP and non-GAAP basis was $61 million or 9.3% of sales compared to $59 million or 9.2% of sales in Q2 2024. The slightly higher year-over-year R&D was primarily due to project-related spending. Q2 operating income was $77 million or 11.8% of sales compared to $101 million or 15.9% of sales in Q2 of 2024. On a non-GAAP basis, second quarter operating margin was 13.6% compared to 16.7% in Q2 of 2024, reflecting the lower gross margin. The change in fair market value of equity security holdings primarily related to the ownership of Sartorius AG shares contributed $250 million to our reported net income of $318 million or $11.67 per diluted share. Non-GAAP net income, which excludes the impact of the change in equity value of Sartorius shares, was $71 million or $2.61 diluted earnings per share for the second quarter of '25. Moving on to cash flow. For the second quarter of 2025, net cash generated from operating activities was $117 million compared to $98 million for Q2 of 2024. Net capital expenditures for the second quarter of 2025 were $46 million, and depreciation and amortization for the second quarter was $41 million. Regarding free cash flow, we were pleased with the generation of $71 million, which compares to $55 million in Q2 of 2024. For the first 6 months of 2025, we generated free cash flow of $166 million, resulting in a year-to-date free cash flow to non-GAAP net income conversion ratio of 117%. We continue to target full-year free cash flow of approximately $310 million to $330 million for 2025. During June, we purchased an additional 170,860 shares of our stock for a total cost of $40 million for an average purchase price of approximately $233 per share on top of the $99 million share repurchase we called out for April. In aggregate, we bought back 593,508 shares during the second quarter for a total cost of $139 million for an average price of approximately $234 per share. We will continue to be opportunistic with our buyback program and still have $337 million available for share repurchases under the current Board authorized program. Moving on to the non-GAAP guidance for 2025. We are raising our 2025 full-year guide to reflect the Q2 results, the close of the Stilla acquisition, the evolving state of academic and biotech research funding and the impact of changes in the macro economy, including tariffs. Overall, we now expect total currency-neutral revenue to be in the range of flat to 1% growth, with the midpoint approximately 25 basis points higher than our previous guide. With respect to our Life Science business, we see consumable demand from academic customers more durable than our prior expectations in addition to an improved outlook for our process chromatography business that I called out earlier. With the recent close of the Stilla acquisition, we now expect revenue for our ddPCR portfolio to increase mid-single digits in 2025 versus low single digits previously. We continue to see a slow biotech recovery and soft demand for instruments. In aggregate, we now expect our Life Science business to increase in the range of flat to 1% for the full year versus flat to down 3% previously. For our Diagnostics business, we are further tightening our range to approximately growth of 0.5% to 1.5% for 2025 versus 0.5% to 2.5% previously. This represents a 50 basis point reduction at the midpoint and primarily reflects continued market softness. Reflecting the easing of trade tensions with China and delays in implementing tariffs in other regions, we now expect a reduced headwind of approximately 30 to 40 basis points to operating margin. The remaining tariff headwinds are primarily related to supplier costs and EU manufactured products that are imported to the U.S. Factoring in the reduced tariff headwind, the updated full-year non-GAAP gross margin is projected to be between 53.5% and 54.5% versus 53% and 54.5% previously. Full-year non-GAAP operating margin is now projected to be between 12% and 13% versus 10% and 12% previously, reflecting our updated gross margin outlook along with proactive cost actions we've taken in managing the business. We continue to anticipate incurring an IPR&D expense in the third quarter as previously disclosed. Due to a further weakening of the U.S. dollar, we now expect currency exchange to be approximately a 100 basis point tailwind to 2025 revenue with a 10 basis point positive impact on operating income. Notwithstanding our updated outlook for 2025, there are still many moving pieces, which we continue to monitor closely. Finally, we had previously mentioned having an Investor Day this November. However, after careful consideration of the continued market volatility and the global geopolitical status, we've decided to move our Investor Day to the spring of 2026. We will provide more detail on a specific date in early 2026.

Thanks, Roop. Again, I think, as we all know, the second quarter remained tumultuous, but it does seem we're all getting used to it, for what it's worth. I think, in any case, it's good to see our customers adapting to the current situation and figuring out how to navigate. And it's nice to see some positive signals relating to NIH funding for 2026. We discussed tariffs. Obviously, it's still evolving. The U.S. government policies are a work in process. But I think to the credit and determination of Bio-Rad employees around the world, as a company, we remain resilient and continue to advance our business on many fronts. Probably good to take a moment here to welcome the Stilla employees to Bio-Rad. I've had the chance to interact with some of them in the last few weeks, and I think they are a great addition to Bio-Rad. As Jon mentioned, Mike Crowley, who's been leading our global commercial operations is retiring after a long and distinguished career at Bio-Rad. Mike has been an important part of Bio-Rad's success over the years. Just a call out, thank you, Mike, for all your contributions. So I think that concludes our prepared remarks. Gill, I think we'll now open it up to take questions.

Maybe first, just on the process chromatography side, nice to see those results this quarter. I think you hinted at maybe a little bit of pull forward. Can you just talk about, I guess, what you saw in the quarter, what sense you have for how much of that was pulled forward? What's sustainable? Just want to talk through, given what's going on with tariffs and everything, it felt like maybe there was a little bit of an impact there. So it would be helpful if you could just talk through that and the expectations for the remainder of the year on that piece.

Yes, of course. So first of all, I'll start out with maybe for the full year, we actually raised kind of the previous guide on process chromatography from high single digits to low double digits. So I think that maybe answers your question on sustainability. We think it is sustainable. Yes, we've had both in Q1 and Q2, a little bit of movement between quarters because these are customer conversations where they want to pull it forward for their own purposes. I can't necessarily say it's because of tariff related. That's not necessarily the driver, but just in terms of their production time frames and these sorts of things. So we were more than happy to help support it. And as I said earlier, I think we see that as continuing to sustain through the rest of the year and expect it to be still good for us.

Okay. Understood. And then in the guidance, I just want to clean up. I know Stilla is now in the guidance. Can you just peel back what contribution that is? Did the organic number move? I just want to make sure I understand where the raise came from, what's organic, what's Stilla? If you could just help us out there, that would be appreciated.

Yes. We have several avenues for growth. Stilla is now included in our guidance as we indicated we would be after closing the transaction on June 30. The updated guidance reflects an increase in the ddPCR growth rate to mid-single digits, which is solely due to Stilla. Continuum was already accounted for in our original guidance for the year, as we anticipated its release in 2025, though we did not specify dates. This update contributes to the increase in the ddPCR growth rate, resulting in an overall range adjustment to 0% to 1%, compared to the previous wider range that extended down to minus 3%. To summarize, we see opportunities for growth in process chromatography, ddPCR with Stilla included, and more resilient consumables, which we discussed earlier.

Yes. That's helpful. And then maybe last one, just on the margins. Obviously, a lot of moving pieces there with some of the tariff moves. Can you just talk about, again, the delta, the bridge from the old guide to the new? What are the moving pieces? What's tariffs, what's not, would be helpful.

Yes, of course. So the biggest piece, tariffs have come down significantly. So that's a big piece, right? If you remember in the prior calls, we had indicated we could see up to 130 points of headwind on tariffs at the bottom line. We now think that that's 30 to 40 basis points of headwind on the operating margin related to tariffs. So significant change there. So if you think about the operating margin change from 10% to 12% previously to now the 12% to 13%, you can see about 100 basis points of that is related to tariffs. The rest of it is related to, one, expecting to see because of Stilla and other things, some better absorption from the manufacturing standpoint. And then, of course, the mix continuing to be stable for us and positive, if you will, because of the consumable pull-through. So those are the different pieces there.

My first question is on the diagnostics market in China. I could use a bit of help understanding how all the headlines relate or don't relate to Bio-Rad over there and why?

Sure, I can start, Jon, and then Norman can add. There are three main points to consider right now. First, China continues to experience softness. Second, regarding the aspects Jon mentioned, we have not observed any effects from VBP, and that remains the case. Third, in relation to DRG, we had anticipated some challenges earlier this year and adjusted our forecasts accordingly during the Q1 call. The issues in Diagnostics included some factors related to the China DRG situation, which we had already factored into our outlook. Finally, concerning reimbursement rate changes, our teams are keeping an eye on that, but we have not received any additional information indicating changes that might negatively affect us.

Yes, exactly, Roop. This is Jon DiVincenzo. Essentially, it reflects our mix compared to some other suppliers. We are a specialty diagnostic supplier. A significant portion of our portfolio consists of quality controls, which are not necessarily influenced by reimbursement. While we were affected by the diabetes reimbursement, other specialty areas are not currently targeted by those policies. It seems they have focused on larger spending areas, which have not impacted us, and we don't believe this will be part of their future considerations.

And Jon, on the panel testing, pressures over there, I know you supply panel tests through the BioPlex 2200, but from a mix perspective, is that just not a big part of your mix in China?

Right, exactly. I think that's the explanation, yes.

I would like to ask a follow-up question about the tariff environment. I understand that there is less of a negative impact on operating margins due to the rollbacks. However, I'm curious about how you are navigating your business amidst all this uncertainty. Have you implemented specific countermeasures for a potentially more challenging tariff environment that required rollbacks? Or are there initiatives currently underway that are still ongoing? It would be helpful if you could elaborate on that process.

Yes. We have taken several actions. We've closely examined all of our suppliers in different regions. We have started adjusting how we transport materials globally for production. We have plans to become even more flexible and adapt to the best sources for those products. We've collaborated with suppliers and our teams, and we've replicated some manufacturing capabilities in certain areas if necessary. We were cautious about overextending due to ongoing volatility. However, as conditions stabilize, we believe we are in a strong position. We understand the challenges we face and have some flexibility with our suppliers as well as within our own facilities to shift manufacturing as needed. Overall, we feel we have built a certain level of adaptability and resilience.

Roop, as we look at the second half, how should we think about revenue margin phasing between third and fourth quarter? And did the second half organic guide actually come down if we exclude the Stilla contribution?

No, it did not grow organically. We are experiencing some challenges in the Diagnostics segment, but Life Sciences continues to perform well, including contributions from Stilla, which is supporting overall growth. I anticipate that Q3 will resemble Q2 in terms of revenue. We do expect an increase in Q4 due to seasonal factors, although the growth may not be as pronounced as in past periods. There might be slight strength in Q3 compared to Q2, but overall, the changes are minimal, with some shifts occurring between Q2 and Q3. Regarding margins, I expect Q3 margins to be in line with those of Q2. In Q4, we should see improvements in margins due to a better mix of higher quality systems and the impact of ddPCR, leading to better absorption compared to Q3 and Q2. This should align us within the midpoint of our provided range of 53.5% to 54.5%. We've dedicated considerable time working with our commercial teams and customers to prepare for the ramp-up in Q4, which we anticipate will be a notable increase over previous quarters. This growth is somewhat dependent on timing and year-over-year comparisons, as we expect larger orders in several business areas. We have strong confidence in the orders expected and in our supply teams' ability to fulfill these orders during the quarter, giving us solid assurance regarding our Q4 projections.

Okay. That's helpful. And then on ddPCR, did you comment on how instruments performed in the quarter? And then secondly, it's nice to see Continuum finally coming to market. I think you mentioned that it was already baked into the guidance. But do you think there's any pent-up demand in the market for that system? And how are you kind of positioning it relative to the Stilla platforms?

Yes, I want to acknowledge the team's excellent work in completing the acquisition and maintaining a strong focus on Continuum, which is equipped with robust quality data for market launch. There is significant excitement surrounding it. The Continuum platform is intended to replace qPCR and follows a 96-well plate standard format, promising enhanced precision and sensitivity for those applications. We're on track with our year-end forecasts. Regarding the QX700 series, the team has successfully rebranded and positioned them. We have developed hundreds of thousands of assays over the past decade, which we are transitioning to Continuum and the QX700. Just a week after closing the deal, our sales team in Pleasanton, California was trained on these products, and we are extending that training globally across sales and service. We are fully committed to capturing market share and expanding the overall digital PCR market. There is a lot of enthusiasm for both of these products and our assay content.

Can you provide insights on how the ddPCR instruments performed in the second quarter?

Yes. They were slightly better on a sequential basis. However, compared to last year, the performance was relatively weak overall.

Still very soft, particularly in the academic market where people are not sure of their budgets overall. So we see softness across the board instruments, not just digital PCR, but all other instruments as well. And just a little bit of color to that. We have not factored in any kind of end of year budget flush, but potentially, that's some upside for us as we speak to customers on a daily basis here. And potentially, there'll be a little more confidence in their budget and there could be a little bit of upside, but we have not factored into our forecast.

First question, I wanted to ask about the process chromatography strength in the quarter. How much of this is just small numbers and easy comps versus can you talk about what you're seeing in terms of order patterns with your customers and any recovery there?

Yes. So I think we're getting back to a normal state where it's not a matter of customers being overstocked anymore. There might be some of that in some places, but I think it's more of an appropriate relationship between how they need product, when they need product and when they're ordering from us. So you're right, it's an easier comp. Last year was a soft year as we allowed our customers to adjust to their inventory levels they wanted. And now we think it's more of a direct correlation between their demand and what they're ordering from us, and it's more similar to the volume that we saw in years past before kind of the volatility of supply chain challenges and overall their own managing their inventory.

Okay. And then sticking with Life Sciences, you called out food safety as a growth driver. It's been a while since we talked about that product family. Anything to note there?

Our food safety business is quite intriguing as we are adapting our products used for life science research to develop specific content for food applications. This segment has consistently experienced high single-digit growth. We have a robust team dedicated to this area. Although it isn't a large business for us, it represents an interesting additional market that doesn't face some of the challenges encountered in life sciences or biotech today. Therefore, we are exploring further opportunities in this sector over the next few years.

Okay. And last one, I wanted to circle back on the U.S. federally funded research customers. Just as you look at them as a customer class, can you talk about how the demand played out throughout the quarter on consumables and instruments? Was it stable? Did it strengthen or weaken at all? How are you feeling about that?

Yes, Jack. It was stable throughout the quarter and improved from where it was in Q1, where I think there was a bit more paralysis, if you will. And that's part of what we're anticipating for the rest of the year to see that continuity from Q2 through the rest of the year.

This is Matt standing in for Tycho. Roop, regarding process chromatography, I appreciate the information in the presentation you provided this quarter. It appears that process chromatography increased by approximately $15 million to $16 million year-over-year. Are you indicating that 20% of that is related to pull forward, suggesting a few million was due to pull forward? Additionally, could you provide more insight into the strong double-digit growth? Given the revenue base of that business and the disclosures, it seems that the strong double digits indicate growth of over 50% this quarter. Can you offer any further details on the extent of the process chromatography growth and the comparison you had in the second quarter?

Roop, I appreciate all the numbers you've shared. However, I think some of those figures might be a bit high. In terms of process chromatography and its performance for the quarter, we obviously have an easier comparison from the standpoint of '24. As we've mentioned, we believe we are in a more normalized environment, which has been beneficial. On a sequential basis, we've observed strength in process chromatography, and there's also a very favorable comparison year-over-year. It's not quite 50% year-over-year growth; it's more likely around half of that figure or slightly above. That's how you should consider it.

Okay. That's helpful. And then just to go back to the new digital PCR launches. It sounds like you have the whole team out there right after it closed. Can you just talk about what you're doing on the commercial side to stimulate demand? Are you running any promotions for existing ddPCR customers? I understand it's a different part of the market. Or are you running any kind of targeted programs for high-end qPCR customers? Just talk about how you're kind of positioning the 700 series in the Continuum going forward.

Yes. And we will share more details at a webinar coming up here. But it's exactly, the point is that this is not to replace our installed base. It's really to expand the number of users for digital PCR. It is a very simple workflow at the right kind of price points to take share from qPCR. And also, as you said, in the high end, with the QX700 HT and our existing QX600 products, we continue to have the high sensitivity products in the market. And we see a number of applications where rather than next-gen sequencing, they can apply digital PCR for kind of faster and less expensive solutions for them. So it's expansion of the marketplace primarily. Of course, there are some areas where it will hit kind of the center of the existing ddPCR market. But in general, it's to expand the number of users of Droplet Digital PCR.

And maybe if I could just sneak one more in. OUS academic government, would just be curious kind of what demand trends look like both in Asia and Europe in 2Q and kind of how you're thinking about the funding and demand backdrop ex U.S. for A&G for the rest of the year?

Yes. So maybe Roop will give more details on it. But when we say academic, we're specifically talking about global academic, where some countries in Europe have shifted budgets to defense or other areas. It's a zero-sum game in some areas. So they're slowing down some investments in academic. So it's not just a U.S. phenomenon. It's a global phenomenon. I can't say I know exactly in China if it's really seen that way or not, but certainly, U.S. and Europe are similar in pressures on academic funding.

I think you're right, Jon. From an APAC perspective, China continues to show weak performance. However, we're noticing positive changes in Korea and Japan, which is encouraging since they have faced challenges for some time. China remains in a weak category, if you will. To reiterate what we mentioned earlier, our customers are focused on retaining their workforce and maintaining their research efforts. I truly admire their creativity in achieving this. This dedication is reflected in our assay and reagent results, which continue to be utilized. Research is moving forward despite uncertainties, and it's commendable that they persist in this effort despite various disruptions and unknowns, as evidenced by our numbers.

I just wanted to call to ask about, can you confirm if the organic number for Q3, which goes from like a negative 3% that goes to about positive 5% in the fourth quarter?

That sounds about right because you're looking at it from a total company standpoint. Is that right?

Yes, that's correct.

And again, part of that is in the fourth quarter last year is when we first saw the reimbursement changes in China. So that's annualized at that point in time. So that's kind of not necessarily because all of a sudden, there's a better market dynamic, it's more of a comp to it.

And just to follow up on the Continuum. How has the response been for the lower throughput customers because I know that was one aspect of the portfolio, there was a gap for that for the ddPCR. How is the uptake from that portion of customers?

Yes. I think it's too early to give you actual results, but actually the flexibility on the Continuum where you can have 1 sample or 96 samples is cost effective and it also meets those customers more episodic when they're actually using the platform. So that's one of the advantages that we're touting to the product. But probably a little too early to tell that there's direct customer user feedback yet. Give us a month or so.

Thank you for joining today's call. As previously discussed, we are planning to host a webinar on Droplet Digital PCR and our updated portfolio on August 26 at 1:00 p.m. Eastern Time, 10 a.m. Pacific. We will post registration information on the Investor Relations section of bio-rad.com shortly. As for upcoming investor conferences this fall, we'll be participating at the Wells Fargo Healthcare Conference in Boston, and the Morgan Stanley Global Healthcare Conference in New York. Our CEO, Norman Schwartz will also be participating on an industry panel at the Nephron Healthcare Summit in Napa. As always, we appreciate your interest, and we look forward to connecting soon.