This article first appeared on GuruFocus .
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Revenue:Total revenue reached $404.2 million, up 27.3% year-over-year.
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Adjusted Net Profit:Reached $62.5 million, up 203.3% year-over-year.
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Gross Profit:Group gross profit reached $206.7 million, up 48% year-over-year.
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Life Science Group (LSG) Revenue:Grew 28.8% to $319 million.
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LSG Adjusted Gross Profit:Reached $185 million, up 46.1% year-over-year.
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LSG Adjusted Operating Profit:Reached $94 million, up 102.8% year-over-year.
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LSG Adjusted Gross Margin:Reached 57.8% (or 55.4% excluding U.S. tariff refunds).
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LSG Adjusted Operating Margin:Reached 29.5% (or 27.1% on the same basis).
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ProBio Revenue:Grew 34.2% to $61.1 million.
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ProBio Adjusted Gross Profit:Reached $8.3 million, up from around $2.7 million in first half 2025.
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ProBio Adjusted EBITDA:Loss narrowed to $6.5 million from $16.8 million in first half 2025.
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BestSign Revenue:Grew 7.4% to $30.4 million.
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BestSign Adjusted Gross Profit:Grew 14% year-over-year to $13 million.
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BestSign Adjusted Operating Loss:Was $1.3 million, compared to a $0.6 million loss in first half of 2025.
Release Date: August 16, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Revenue exceeded $400 million with 27.3% year-over-year growth, and adjusted net profit surged over 200% to $62.5 million, demonstrating strong top-line and bottom-line performance.
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Life Science Group (LSG) delivered 28.8% revenue growth and doubled adjusted operating profit to $94 million, with operating margin approaching 30%, reflecting significant operational leverage.
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AI-driven drug discovery (AIDD) demand is a major growth engine, with orders projected to double in the second half and a structural shift toward recurring, high-volume validation services.
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ProBio achieved 34.2% revenue growth and a 54% increase in new orders, with adjusted EBITDA loss narrowing by over $10 million, signaling a clear path to profitability.
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The company raised its full-year guidance for LSG to 25-30% revenue growth and ProBio to 25-30%, underpinned by strong order momentum and a robust balance sheet with $830 million in cash.
Negative Points
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Bestzyme's adjusted operating loss widened to $1.3 million from $0.6 million in the prior year, reflecting deliberate investments that may pressure near-term profitability.
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The company faces potential competitive pressure from players like Twist Bioscience, though management argues its platform advantages are durable.
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AIDD-related orders carry higher margins but also require significant capacity expansion, with capital expenditures expected to reach $130 million in 2026, which could strain cash flow if demand softens.
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The company's growth is increasingly dependent on the nascent and rapidly evolving AIDD market, which carries execution risks and potential volatility in customer demand.
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Despite strong overall performance, the company's reliance on North America for 50% of revenue exposes it to regional economic and regulatory risks, including tariff impacts.
Q & A Highlights
Q: Management significantly raised its 2026 guidance for the Life Science segment. What are the key drivers behind this upgrade, and what is the likelihood of further upside given the strong AIDD demand? A: Ray Chen, President of GenScript Life Science Group, attributed the upgrade to three reinforcing drivers: 1) Surging AIDD demand, with larger project sizes and deeper, more strategic engagements; 2) A compounding, higher-quality customer base, with a growing share converting from single projects to multi-stage, multi-service partnerships; and 3) The fruits of years of platform investment in automation and digitalization, translating into shorter turnaround times and greater scalability. Chen noted that AIDD is still early, with customers moving from proof-of-concept to large-scale validation. He cited three concrete signals of continued upside: growing order sizes, deepening customer relationships, and a rising share of high-complexity, structured recurring orders. He concluded that if these trends continue, there is "real potential for continued upside versus our current assumptions."
Q: How does GenScript view the competitive landscape against Twist Bioscience in the AIDD space, and what is GenScript's competitive edge? A: Ray Chen stated that GenScript does not compete on commodity volume but on value per delivered result, speed to data, and data quality. He provided specific metrics: GenScript captures more than twice the revenue per delivered item versus Twist, processes over 4,000 designs per day (vs. Twist's thousands per week), and delivers from digital sequence to binding data in 4-7 days (vs. Twist's two-plus weeks). Most importantly, Chen highlighted data quality, citing a recent customer evaluation where GenScript's assay variability came in under 10% compared to nearly 30% for Twist. He emphasized that GenScript's modular, intelligent workstations allow for faster capacity addition with lower capital intensity, and the company is targeting doubling throughput capacity every quarter.
Q: Can you provide details on ProBio's AIDD-related pipeline and technology capabilities, and what are the company's CapEx plans and potential financing requirements to support this growth? A: Allen Guo, CEO of ProBio, reported that ProBio signed $9.7 million in AIDD-related orders in H1 2026, delivering around $2.5 million in revenue. He noted that AI-generated drug candidates are typically complex molecules (bispecific or trispecific antibodies) requiring accelerated timelines and high-throughput parallel development. ProBio has established specialized solutions, including a wet-lab validation platform capable of processing thousands of samples per day and an Express CMC offering, enabling progression to PCC in as little as four months. CFO Phil Zhou addressed capital allocation, stating the company incurred $48.4 million in CapEx in H1 2026 and expects full-year CapEx of approximately $130 million. With roughly $830 million in cash and a robust balance sheet, Zhou confirmed there is no need for equity financing.
Q: How do the needs of large AI model companies differ from traditional pharma and biotech customers, and how is GenScript adapting? A: Ray Chen explained that AI-native customers operate on an entirely different order of magnitude, generating hundreds or thousands of candidate sequences in a single iteration, each requiring rapid experimental validation. They demand continuous, fast feedback loops with turnaround measured in days, not weeks, and they push molecular complexity boundaries that traditional discovery won't attempt. Chen emphasized the key insight: for AI-native customers, GenScript is not just delivering DNA constructs or proteins, but the data itself, which feeds back into model development. This transforms GenScript from a one-off project vendor into part of the customer's AI development infrastructure, significantly expanding customer lifetime value and creating a structural, long-term growth driver.
Q: Can you provide more color on the improved gross profit margin in H1, particularly for AIDD orders, and how should we think about long-term AIDD margins and entry barriers? A: CFO Phil Zhou explained that AIDD-related orders carry structurally higher margins due to three durable drivers: 1) Larger-scale, high-volume orders that spread fixed costs; 2) A premium for speed, as rapid turnaround is essential for AI model iteration; and 3) The deliverable itself is higher-value structured experimental data, not just protein. Zhou noted AIDD projects run roughly 20 percentage points higher in gross margin than traditional protein expression orders. He believes this differential will persist or widen because the value of speed and model-ready data becomes more critical as AI adoption deepens, and GenScript's improving cost structure will help defend the margin premium even as competition intensifies.
Q: How is Bestzyme integrating AI into its operations, and what impact is it having on the business? A: Aixi Bai, General Manager of Bestzyme, stated that AI is deeply integrated into every stage of R&D, resulting in faster R&D and lower costs. AI-driven multi-property optimization has doubled the positive hit rate compared to 2025, with some projects achieving goals in just two rounds of variant design with fewer than 150 mutants. For 2026, Bestzyme expects to deliver six to seven projects, twice as many as in 2025. The company is launching a design online platform and a product flow agent platform that have already cut lead time by 20%. AI models have driven significant cost savings across more than three projects, with specific products like five-day and high-temperature amylase achieving gross margin improvements of 7% and 6%, respectively.
Q: What is the current utilization rate of GenScript's platform, and how is the company preparing for increased capacity, particularly on the protein side where automation is lower? A: Ray Chen responded that GenScript's infrastructure is built on modular, intelligent workflows and workstations, allowing rapid scaling with confidence. He stated that the order magnitude GenScript is receiving is something "no one else in the world could accept and deliver." Chen expressed confidence in further doubling throughput capacities in the coming days and months, emphasizing that the scaling applies not just to genes but all the way through protein expression and downstream assays for validation.
Q: What are the key financial highlights for the first half of 2026, and what is the company's outlook for the full year? A: CFO Phil Zhou reported revenue of $404.2 million, up 27.3% year-over-year, with gross profit reaching $206.7 million, up 48%. Adjusted net profit hit a record $62.5 million, up 203.3%. The Life Science Group grew 28.8% to $319 million, with adjusted operating profit doubling to $94 million. ProBio grew 34.2% to $
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
