Bio Rad Laboratories Inc (BIO) 2024 Q2 法說會逐字稿

(Operator Instructions) Good day, everyone, and welcome to today's Bio-Rad second quarter 2024 earnings results conference call and webcast. (Operator Instructions) Please note this call is being recorded. (Operator Instructions) It is now my pleasure to turn the conference over to Head of Investor Relations, Edward Chung.

（操作員說明）大家好，歡迎參加今天的 Bio-Rad 2024 年第二季財報電話會議和網路廣播。（操作員說明）請注意此通話正在錄音。（操作員指示） 現在我很高興將會議轉交給投資者關係主管 Edward Chung。

Thanks, operator. Good afternoon, everyone, and thank you for joining us. Today, we will review the second quarter 2024 financial results and provide an update on key business trends for Bio-Rad. With me on the call today are Norman Schwartz, our Chief Executive Officer; Andy Last, Executive Vice President and Chief Operating Officer, and Roop Lakkaraju, Executive Vice President and Chief Financial Officer.

謝謝，接線生。大家下午好，感謝您加入我們。今天，我們將回顧 2024 年第二季的財務業績，並提供 Bio-Rad 關鍵業務趨勢的最新資訊。今天與我一起參加電話會議的是我們的執行長諾曼·施瓦茨 (Norman Schwartz)； Andy Last，執行副總裁兼營運長；Roop Lakkaraju，執行副總裁兼財務長。

Before we begin our review, I'd like 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 are subject to risks and uncertainties. Our actual results may differ materially from these plans, goals and expectations.

在我們開始審查之前，我想提醒大家，我們將對管理層的目標、計劃和期望、我們未來的財務表現和其他事項做出前瞻性陳述。這些陳述是基於對未來事件的假設和預期，這些事件存在風險和不確定性。我們的實際結果可能與這些計劃、目標和期望有重大差異。

You should not place undue reliance on these forward-looking statements, and I encourage you to review our filings with the SEC where we discuss in detail of that risk factors in our business. The company does not intend to update any forward-looking statements made during the call today.

您不應過度依賴這些前瞻性陳述，我鼓勵您查看我們向 SEC 提交的文件，其中我們詳細討論了我們業務中的風險因素。該公司不打算更新今天電話會議中所做的任何前瞻性聲明。

Finally, our remarks today will include references to non-GAAP financial, including net income and diluted earnings per share, which are financial measures that are not defined under generally accepted accounting principles. Investors should review the reconciliation of these non-GAAP measures to the comparable GAAP results contained in our earnings release.

最後，我們今天的演講將提及非公認會計準則財務，包括淨利潤和稀釋每股收益，這些財務指標並未根據公認會計原則進行定義。投資者應審查這些非公認會計準則衡量指標與我們收益發布中包含的可比較公認會計準則結果的調節情況。

With that, I'll now turn the call over to our CEO, Norman Schwartz.

現在，我將把電話轉給我們的執行長諾曼·施瓦茨 (Norman Schwartz)。

Thanks, Ed. Again, we appreciate your joining us on the call today. I guess I would say overall, despite a challenging market environment, we did have a solid quarter with revenue in line with expectations and margins actually ahead of expectations, driven by favorable product mix, productivity gains and overall good cost management.

謝謝，艾德。再次感謝您今天加入我們的電話會議。我想我想說的是，總體而言，儘管市場環境充滿挑戰，但在有利的產品組合、生產力提高和整體良好的成本管理的推動下，我們確實度過了一個穩健的季度，收入符合預期，利潤率實際上超出了預期。

I would say that while we have seen some positive signs with the improved biotech funding, we are continuing to see constraints in biotech, biopharma spending globally. As such, we do think it's prudent to revise our full year 2024 financial outlook to better reflect a -- what I think it was a more modest pace of market recovery than originally predicted.

我想說，雖然我們看到了生物技術資金改善的一些積極跡象，但我們仍然看到全球生物技術、生物製藥支出受到限制。因此，我們確實認為謹慎的做法是修改 2024 年全年財務前景，以更好地反映市場復甦的步伐——我認為市場復甦的步伐比最初預測的更為溫和。

Roop will cover this in greater detail as we review our updated 2024 financial guidance. During the quarter, we continue to make progress establishing the new leadership team. You've already met Roop, our new CFO and have gotten a sense of his priorities as he comes up to speed, our new heads of Life Science and Clinical Diagnostics. I would say, also hit the ground running and are working closely with the CEO, Andy Last, to align on key initiatives.

在我們審查更新的 2024 年財務指引時，Roop 將更詳細地介紹這一點。本季度，我們在組建新領導團隊方面繼續取得進展。您已經認識了我們新任財務長魯普 (Roop)，並了解了他的優先事項，因為他是我們新任生命科學和臨床診斷主管。我想說的是，我們也立即開始行動，並與執行長安迪·拉斯特（Andy Last）密切合作，以協調關鍵舉措。

Lastly, here, we have made good progress on our search for a new Chief Operating Officer and have identified several finalist candidates. We do hope to share an update with you on this front in the coming weeks.

最後，我們在尋找新營運長方面取得了良好進展，並確定了幾位最終候選人。我們確實希望在未來幾週內與您分享這方面的最新情況。

We are continuing our corporate transformation path, more recently with efforts in supply chain and core process improvements, which are really starting -- it could contribute to our margin expansion. We expect to build on this progress and what our life science business rebounds in future quarters, we anticipate we'll see further benefit here.

我們正在繼續我們的企業轉型之路，最近在供應鏈和核心流程改進方面做出了努力，這些努力才真正開始——這可能有助於我們的利潤率擴張。我們期望在這一進展以及我們的生命科學業務在未來幾個季度的反彈的基礎上再接再厲，我們預計我們將在這裡看到更多的好處。

On the capital deployment front, we've continued to be successful with share repurchases having bought back $100 million with the Bio-Rad stock during Q2 and an additional $96 million during the month of July. And just to continue on that, this week, the Board authorized an additional $500 million, which further positions us to make opportunistic repurchases going forward.

在資本部署方面，我們在股票回購方面繼續取得成功，在第二季度回購了 1 億美元的 Bio-Rad 股票，並在 7 月回購了 9,600 萬美元。為了繼續這一目標，本週，董事會額外授權了 5 億美元，這進一步使我們能夠在未來進行機會性回購。

So all in all, I guess I'd like to reiterate that we view our strategy and focus for the future, both for the company to be really very much intact. In clinical diagnostics, we have leading market positions globally for our core platforms, continue to invest in supporting their growth while building a position in new molecular diagnostics segments and in life science, we both continue to maintain a focus on biopharma, especially for digital PCR to process chromatography products and new products in development around cell biology.

總而言之，我想重申我們對未來的策略和重點，這兩者都是為了公司真正完好無損。在臨床診斷領域，我們的核心平台擁有全球領先的市場地位，繼續投資支持其成長，同時在新的分子診斷領域和生命科學領域建立地位，我們都繼續專注於生物製藥，特別是數位 PCR處理圍繞細胞生物學開發的色譜產品和新產品。

But we also continue to invest to enhance our leadership in digital PCR and other positions in the academic market. Very important area for us. As such, we believe we're well positioned to drive long-term growth. And in both the academic and biopharma markets in life sciences as we move through this dynamic period. So maybe now I'll turn the call over to Andy to provide an update on global operations. Andy?

但我們也持續投資，以增強我們在數位 PCR 和學術市場其他領域的領導地位。對我們來說非常重要的領域。因此，我們相信我們有能力推動長期成長。當我們經歷這個充滿活力的時期時，生命科學領域的學術和生物製藥市場也是如此。因此，也許現在我會將電話轉給安迪，以提供全球營運的最新情況。安迪？

Thank you, Norman. Good afternoon, and thank you all for joining us. Second quarter of the year reflected a continuation of the same macroeconomic and market trends we've experienced with several quarters in the biotech and biopharma segments in China, alongside a generally improved market environment for our clinical diagnostic platforms. Our clinical diagnostics business continued to show steady growth in the quarter, delivering solid gains both sequentially and year-over-year.

謝謝你，諾曼。下午好，感謝大家加入我們。今年第二季反映了我們在中國生物技術和生物製藥領域經歷了幾個季度的宏觀經濟和市場趨勢的延續，以及我們的臨床診斷平台的市場環境普遍改善。我們的臨床診斷業務在本季度繼續呈現穩定成長，實現了環比和同比的穩健成長。

Growth was broad-based across the portfolio in all regions with solid performance in our immuno-hematology business when compared against the supply chain constraints we experienced in prior year. As we look toward the second half of this year, we are -- we are anticipating a continuation of normalized growth within our clinical diagnostics business.

與前一年我們經歷的供應鏈限制相比，我們的免疫血液學業務在所有地區的投資組合中都有廣泛的成長，表現穩健。展望今年下半年，我們預期臨床診斷業務將持續正常成長。

While it was in line with expectations, our Life Science Group sales declined double digit year-over-year, reflecting ongoing low demand in biotech and biopharma and in China. However, sequentially, second quarter revenue for the Life Science Group improved mid-single-digits and when excluding process chromatography sales, core life science grew sequentially mid-single digits in both biopharma and academic markets.

雖然符合預期，但我們的生命科學集團銷售額比去年同期下降了兩位數，反映出生物技術和生物製藥以及中國的需求持續低迷。然而，生命科學集團第二季的收入連續成長了中個位數，如果不包括製程色譜銷售，核心生命科學在生物製藥和學術市場上連續成長中個位數。

Similar to the prior year, our process chromatography resins posted a year-over-year decline, reflecting the ongoing destocking trend across the industry. More importantly for us, this is the result of several very large customers who stopped up heavily during -- prior years due to the critical importance of our products for specific key therapeutics. Outside of these key customers, we are starting to see a return to a normalized ordering pattern and are now looking to 2025 for a return to growth.

與去年類似，我們的製程層析樹脂較去年同期下降，反映出整個產業持續的去庫存趨勢。對我們來說更重要的是，這是由於我們的產品對於特定關鍵療法至關重要而在前幾年嚴重停止的幾個非常大的客戶的結果。除了這些主要客戶之外，我們開始看到正常化訂購模式的回歸，並且現在期待 2025 年恢復成長。

We remain confident in the long-term outlook for this product area. Excluding process chromatography, our core Life Science business continued to stabilize, declining low double-digit compared to prior year and in line with our expectations. The declines were again concentrated in instrument sales, primarily reflecting constrained biopharma spending, whereas consumable and reagent sales were largely flat, both sequentially and year-over-year.

我們對該產品領域的長期前景仍充滿信心。不包括過程色譜，我們的核心生命科學業務繼續穩定，與前一年相比下降了低兩位數，符合我們的預期。下降再次集中在儀器銷售上，主要反映了生物製藥支出受到限制，而消耗品和試劑銷售則基本持平，無論是環比還是同比。

During the second quarter, we launched two new important life science platforms, the ChemiDoc Imaging Systems which is getting strong interest from customers and our new cost-effective single cell sample prep solution that is in the early phase of product introduction.

在第二季度，我們推出了兩個新的重要生命科學平台，即引起客戶濃厚興趣的 ChemiDoc 成像系統和處於產品推出早期階段的新的經濟高效的單細胞樣品製備解決方案。

Our Droplet Digital PCR franchise was soft in Q2, against a tough prior year compare that included the receipt of a onetime technology license payment and reduction of back orders created due to supply change challenge from -- prior periods mainly for QX600. However, excluding the onetime impacts in the prior year, revenue for ddPCR declined a more modest mid-single digits.

我們的Droplet Digital PCR 特許經營權在第二季度表現疲軟，而去年的情況則很艱難，包括收到一次性技術許可付款以及由於供應變化挑戰而產生的延期交貨訂單減少——主要是針對QX600的供應變化。然而，排除上一年度的一次性影響，ddPCR 的收入下降幅度較小，為中個位數。

On a positive note, ddPCR reagents and consumables grew low single digits year-over-year despite the constrained funding environment. We are seeing strong interest in our recently launched ddPCR assay kits targeted at the oncology and cell and gene therapy markets. And we continue to maintain strong win-loss ratios for our Digital PCR platform in our current market segments. Importantly, we continue to target a fourth quarter introduction of the QX continuum which will allow us to end to the low end segment where others have been primarily focused.

從正面的方面來看，儘管資金環境有限，但 ddPCR 試劑和耗材的年成長率仍保持較低個位數成長。我們看到人們對我們最近推出的針對腫瘤學、細胞和基因療法市場的 ddPCR 檢測試劑盒產生了濃厚的興趣。我們的數位 PCR 平台在當前細分市場中持續保持強勁的盈虧比。重要的是，我們繼續目標是在第四季度推出 QX 連續體，這將使我們能夠結束其他人主要關注的低端市場。

In addition, we recently entered into a purchase agreement for a novel cutting-edge platform utilizing our core droplet technology that enables high throughput discovery of novel antibodies and T-cell receptors and complements our phage display library. This is a high-growth, high-value market segment and assuming successful completion of development, we anticipate introducing this platform in the next two to three years.

此外，我們最近簽署了一項新型尖端平台的購買協議，該平台利用我們的核心液滴技術，能夠高通量發現新型抗體和 T 細胞受體，並補充我們的噬菌體展示庫。這是一個高成長、高價值的細分市場，假設開發成功，我們預計在未來兩到三年內推出該平台。

Reflecting on the current macroeconomic and market conditions, we were pleased to see the positive trend for capital raises for the biotech and biopharma markets continuing into the second quarter. As Norman alluded to earlier, we have yet to see this funding translate into improved orders as customers appear to remain conservative on capital deployment. Likewise, market conditions in China remain soft for the Life Science business, although we remain hopeful of some improvement in the outlook towards the end of the year and into 2025.

考慮到當前的宏觀經濟和市場狀況，我們很高興看到生物技術和生物製藥市場融資的正面趨勢持續到第二季​​。正如諾曼之前提到的，我們尚未看到這筆資金轉化為訂單的改善，因為客戶似乎對資本部署保持保守。同樣，中國生命科學業務的市場狀況仍然疲軟，儘管我們仍然希望年底和 2025 年的前景有所改善。

In the Academic segment, we are seeing a slight softening of the global funding environment after a long period of strong research support. In addition to the slightly lower than anticipated NIH budget for the year, key European markets remain a mixed bag with lower funding in Germany, offset by more modest improvements in funding outlooks in the UK, France and other EU countries.

在學術領域，經過長期的強大的研究支持，我們看到全球資助環境略有軟化。除了美國國立衛生研究院今年的預算略低於預期外，歐洲主要市場仍然參差不齊，德國的資金減少，但被英國、法國和其他歐盟國家的資金前景的溫和改善所抵消。

For Asia, the challenging research funding environment in China continues and funding in Japan remains constrained, reflecting a shrinking economy, while Korean government spending on life science research remains soft as part of the deficit reduction.

對亞洲來說，中國的研究資助環境仍充滿挑戰，日本的資助仍受到限制，反映出經濟萎縮，而作為赤字削減的一部分，韓國政府在生命科學研究方面的支出仍然疲軟。

With these factors in mind, we remain -- remain cautious on the magnitude and timing of the recovery in life science markets and now with respect to more measured improvements in the back half of the year. We continue to expect steady, normalized growth for our clinical diagnostics business in 2024.

考慮到這些因素，我們仍然對生命科學市場復甦的幅度和時機以及今年下半年更加謹慎的改善保持謹慎態度。我們繼續預期 2024 年我們的臨床診斷業務將實現穩定、常態化的成長。

Operationally, we continue our focus on cost and productivity initiatives that have provided offsets to the softer top line. As we look toward eventual market recovery for our Life Science business, we believe that Bio-Rad remains poised for further margin expansion. Thank you, and I will now pass you to Roop to review the financial results.

在營運方面，我們繼續關注成本和生產力計劃，以抵消營收疲軟的影響。當我們期待生命科學業務的市場最終復甦時，我們相信 Bio-Rad 仍有望進一步擴大利潤率。謝謝，我現在將請您轉至 Roop 審核財務表現。

Thank you, Andy, and good afternoon. I'd like to start with a review of the second quarter 2024 results. Net sales were $638 million, which included approximately 1% currency headwind and represents a 6.3% decline on a reportable basis versus $681 million in Q2 of '23. On a currency-neutral basis, the year-over-year revenue decline was 5.4%.

謝謝你，安迪，下午好。我想先回顧一下 2024 年第二季的業績。淨銷售額為 6.38 億美元，其中包括約 1% 的貨幣不利因素，與 2023 年第二季的 6.81 億美元相比，在可報告的基礎上下降了 6.3%。在剔除貨幣因素的基礎上，營收年減 5.4%。

As Andy mentioned, this was the result of ongoing weakness in key life science end markets, somewhat offset by continued growth with the Clinical Diagnostics Group. Sales of the Life Science Group were approximately $251 million compared to $300 million in Q2 of '23, which is a decrease of 16.5% on a reported basis and a decline of 15.9% on a currency neutral basis. Year-over-year decline impacted most product and geographic areas. Excluding process chromatography sales, which can fluctuate quarter-to-quarter, core Life Science Group revenue decreased 11.6% on a currency-neutral basis.

正如安迪所提到的，這是主要生命科學終端市場持續疲軟的結果，但在某種程度上被臨床診斷集團的持續成長所抵消。生命科學集團的銷售額約為 2.51 億美元，而 2023 年第二季的銷售額為 3 億美元，在報告基礎上下降了 16.5%，在貨幣中性基礎上下降了 15.9%。年比下降影響了大多數產品和地理區域。不計入可能會出現季度波動的工藝色譜銷售額，生命科學集團的核心收入在匯率中性的基礎上下降了 11.6%。

Sales of the Clinical Diagnostics Group were $388 million compared to $380 million in Q2 of '23, which is an increase of 2.1% on a reported basis and 3.2% on a currency neutral basis. Growth of the Clinical Diagnostics group was primarily driven by increased demand for quality controls and blood typing products. On a geographic basis, currency neutral year-over-year revenue for the Diagnostics group posted growth across all three regions.

臨床診斷集團的銷售額為 3.88 億美元，而 2023 年第二季的銷售額為 3.8 億美元，按報告計算成長 2.1%，以貨幣中性計算成長 3.2%。臨床診斷部門的成長主要是由於對品質控制和血型產品的需求增加所推動的。從地理來看，診斷集團在所有三個地區的年收入均實現成長。

For the company, Q2 reported GAAP gross margin was 55.6% as compared to 53.2% in the second quarter of '23. The increase in gross margin was primarily driven by cost control initiatives, product mix and lower logistics costs, partially offset by lower sales volume and continued higher material prices for constrained or strategic materials. Note that 90% of the improvement was driven by cost controls, product mix and logistics.

該公司第二季的 GAAP 毛利率為 55.6%，而 2023 年第二季為 53.2%。毛利率的成長主要是由成本控制措施、產品組合和較低的物流成本所推動的，但部分被銷售下降和受限或策略性材料的材料價格持續上漲所抵消。請注意，90% 的改進是由成本控制、產品組合和物流推動的。

SG&A expenses for Q2 '24 were $195 million or 30.5% of sales compared to $208 million or 30.5% in Q2 of '23. The decrease in dollars of SG&A expense was primarily due to lower employee related expenses, restructuring costs and discretionary spending.

2024 年第二季的銷售管理及行政費用為 1.95 億美元，佔銷售額的 30.5%，而 2023 年第二季的銷售費用為 2.08 億美元，佔銷售額的 30.5%。SG&A 費用的減少主要是由於員工相關費用、重組成本和可自由支配支出的減少。

Research and development expense in the second quarter was $59 million or 9.2% of sales compared to $65 million or 9.5% of sales in Q2 '23. The decrease in dollars of R&D expense was primarily due to the cost control and lower restructuring costs. Q2 operating income was approximately $101 million or 15.9% of sales compared to $90 million or 13.2% of sales in Q2 of '23. Higher operating income is primarily driven by our proactive expense management initiatives and product mix, partially offset by lower sales. During the quarter, interest and other income resulted in net other income of about $8 million compared to about $5 million in the prior year.

第二季的研發費用為 5,900 萬美元，佔銷售額的 9.2%，而 2023 年第二季的研發費用為 6,500 萬美元，佔銷售額的 9.5%。研發費用的美元減少主要是因為成本控制和重組成本降低。第二季營業收入約 1.01 億美元，佔銷售額的 15.9%，而 2023 年第二季營業收入為 9,000 萬美元，佔銷售額的 13.2%。較高的營業收入主要是由我們積極的費用管理措施和產品組合所推動的，但部分被較低的銷售所抵銷。本季度，利息和其他收入帶來的其他淨收入約為 800 萬美元，而前一年約為 500 萬美元。

The effective tax rate for the second quarter of '24 was 22.3%, largely consistent with the 22.5% rate in the year ago period. The change in fair market value of equity security holdings, which are substantially related to the ownership of Sartorius AG shares, resulted in a $2.9 billion loss and drove the reported net loss of $2.2 billion or $76.26 diluted loss per share compared to net loss of $1.2 billion or a diluted loss per share of $39.59 in Q2 of '23.

2024 年第二季的有效稅率為 22.3%，與去年同期的 22.5% 基本一致。與Sartorius AG 股份所有權密切相關的股權證券持有的公平市場價值的變化導致了29 億美元的損失，並導致報告的淨損失達到22 億美元，即每股攤薄損失76.26 美元，而淨損失為1.2美元2023 年第二季的每股攤薄虧損為 39.59 美元。

Moving to the non-GAAP results. Non-GAAP financial measures, which exclude certain atypical and unique items that impact both gross and operating margins and other income are detailed in the reconciliation table in our press release.

轉向非 GAAP 業績。我們新聞稿中的調節表詳細介紹了非公認會計原則財務指標，其中排除了影響毛利率和營業利潤率以及其他收入的某些非典型和獨特項目。

Second quarter non-GAAP gross margin was 56.4% compared to 54.4% Q2 of '23, primarily reflecting various expense management initiatives we've implemented. Non-GAAP SG&A dollar spend was slightly lower on a year-over-year basis, but as a percentage of sales, was higher due to lower revenue in Q2 '24. Specifically in the second quarter of '24, SG&A as a percent was 30.4% versus 29.2% in Q2 of '23.

第二季非 GAAP 毛利率為 56.4%，而 2023 年第二季為 54.4%，主要反映了我們實施的各種費用管理措施。非 GAAP SG&A 美元支出較去年同期略有下降，但由於 2024 年第二季收入下降，佔銷售額的百分比有所上升。特別是在 2024 年第二季度，SG&A 百分比為 30.4%，而 23 年第二季為 29.2%。

Non-GAAP R&D as a percentage of sales in the second quarter of '24 was 9.3%, which is flat to Q2 of 2023. Second quarter non-GAAP operating margin was 16.8%. Our non-GAAP operating margin has expanded by 100 basis points from Q2 of '23 as reported non-GAAP gross margin of 15.8%, driven by the improvement in gross margin and the proactive operating expense cost management initiatives. The non-GAAP effective tax rate for the second quarter of 2024 was 23.4% compared to 22.5% for the same period in '23. The higher rate in '24 was driven by a geographical mix of earnings.

2024 年第二季非 GAAP 研發佔銷售額的百分比為 9.3%，與 2023 年第二季持平。第二季非 GAAP 營運利潤率為 16.8%。在毛利率改善和積極的營運費用成本管理措施的推動下，我們的非公認會計原則營業利潤率比 2023 年第二季度擴大了 100 個基點，報告的非公認會計原則毛利率為 15.8%。2024 年第二季的非公認會計原則有效稅率為 23.4%，而 2023 年同期為 22.5%。24 年較高的比率是由收入的地理組合所推動的。

Finally, non-GAAP net income for the second quarter of 2024 was $89 million or $3.11 diluted earnings per share compared to $89 million or diluted earnings per share of $0.03 in Q2 of '23. Moving on to the balance sheet, total cash and short term investments at the end of Q2 2024 was $1.62 billion, compared to $1.65 billion at the end of Q1 2024.

最後，2024 年第二季的非 GAAP 淨利為 8,900 萬美元，或攤薄每股收益 3.11 美元，而 2023 年第二季的非 GAAP 淨利為 8,900 萬美元，或攤薄每股收益 0.03 美元。轉向資產負債表，2024 年第二季末的現金和短期投資總額為 16.2 億美元，而 2024 年第一季末為 16.5 億美元。

Inventory at the end of Q2 was 100 -- I'm sorry, $804 million as compared to $783 million at the end of the first quarter. The increase is due to the strategic purchases of difficult to source raw materials that are critical to our supply chain.

第二季末的庫存為 100——抱歉，為 8.04 億美元，而第一季末的庫存為 7.83 億美元。這一增長是由於策略性採購了對我們的供應鏈至關重要的難以採購的原材料。

For the second quarter of 2024, net cash generated from operating activities was approximately $98 million, the same as Q2 of '23. Net capital expenditures for the second quarter of 2024 were approximately $42 million and depreciation and amortization was $36 million. Second quarter of 2024 free cash flow was approximately $55 million, which compares to $63 million in Q2 of 2023. Adjusted EBITDA for the second quarter of 2024 was $138 million or 21.6% of sales and was approximately $138 million or 20.2% of sales in the second quarter of 2023.

2024 年第二季度，經營活動產生的現金淨額約為 9,800 萬美元，與 23 年第二季相同。2024 年第二季的淨資本支出約為 4,200 萬美元，折舊和攤提為 3,600 萬美元。2024 年第二季的自由現金流約為 5,500 萬美元，而 2023 年第二季為 6,300 萬美元。2024 年第二季調整後 EBITDA 為 1.38 億美元，佔銷售額的 21.6%；2023 年第二季調整後 EBITDA 約為 1.38 億美元，佔銷售額的 20.2%。

During the second quarter, we repurchased 346,226 shares of our stock for about $100 million at an average purchase price of about $289 per share. During July 2024, we repurchased an additional $96 million at an average purchase price of about $293 per share.

第二季度，我們以約 1 億美元的價格回購了 346,226 股股票，平均購買價格約為每股 289 美元。2024 年 7 月期間，我們以每股約 293 美元的平均購買價格額外回購了 9,600 萬美元。

We also announced today that the Board authorized a $500 million increase to our existing share repurchase program. And in total, we now have approximately $578 million available for share repurchases as we continue to be opportunistic in our approach with buybacks.

我們今天也宣布，董事會授權將我們現有的股票回購計畫增加 5 億美元。總的來說，我們現在有大約 5.78 億美元可用於股票回購，因為我們繼續採取機會主義的回購方式。

Moving on to the non-GAAP guidance. As referenced in Andy's commentary, we have seen improved funding for the biotech end market that is yet to fully translate into customer orders. Given the pace of customer bioprocessing destock and the expectations of a much more moderated pace of biopharma recovery, we have tempered the outlook for our Life Science Group in the back half of the year. We continue to expect healthy normalized growth for the Clinical Diagnostics Group in 2024.

轉向非公認會計原則指導。正如安迪的評論中所提到的，我們看到生物技術終端市場的資金有所改善，但尚未完全轉化為客戶訂單。考慮到客戶生物加工去庫存的步伐以及生物製藥復甦步伐更加放緩的預期，我們調整了生命科學集團下半年的前景。我們繼續預計臨床診斷集團在 2024 年將實現健康的正常成長。

Taken together, we now estimate currency neutral year-over-year revenue to decline 2.5% to 4% for 2024 versus growth of 1% to 2.5% in our prior guidance. The 500 basis points change in our revenue outlook is because of lower process [chromatography] demand and slower than expected biopharma recovery offset by the higher levels of clinical diagnostics sales. For the second half of the year, we expect about 2% year-over-year currency neutral revenue growth versus a 7.5% year-over-year decline in the first half of 2024. This represents about 6% revenue growth in the second half of 2024 over the first half.

綜上所述，我們現在預計 2024 年，貨幣中立的年收入將下降 2.5% 至 4%，而我們先前的指導則為成長 1% 至 2.5%。我們的收入前景發生 500 個基點的變化，是因為製程 [色譜] 需求下降以及生物製藥復甦慢於預期，但被臨床診斷銷售水平較高所抵消。我們預計下半年營收將年增約 2%，而 2024 年上半年營收將年減 7.5%。這意味著 2024 年下半年的收入較上半年成長約 6%。

For the Life Sciences Group, we expect between 10% and 12% currency neutral revenue decline for 2024. The full year Life Science Group year-over-year sales decline, excluding process chromatography related sales, is expected to be about 4%.In this business group, we expect low double digit revenue growth for the second half of the year over the first half.

對於生命科學集團，我們預計 2024 年貨幣中性收入將下降 10% 至 12%。生命科學集團全年銷售額較去年同期下降（不包括製程色譜相關銷售額）預計約 4%。對於該業務組，我們預計下半年的營收成長將較上半年低兩位數。

For the Diagnostics Group, we are now guiding currency neutral revenue growth to be between 3% and 3.5% for 2024. This represents revenue growth for the Diagnostics Group of about 2% for the second half of the year over the first half.

對於 Diagnostics Group，我們目前指導 2024 年貨幣中性收入成長在 3% 至 3.5% 之間。這意味著診斷集團下半年的營收較上半年成長約2%。

Full-year non-GAAP gross margins are now projected to be between 54.5% and 55% versus 54% and 54.5% previously. Reflecting a combination of better product mix and cost improvements we've implemented. Our updated gross margin outlook is higher than our prior guidance. However, below the 55.3% we achieved in the first half of the year, because of the expected lower revenue in the second half of 2024, which will drive a higher level of fixed costs under absorption than previously forecasted.

目前預計全年非 GAAP 毛利率為 54.5% 至 55%，而先前為 54% 至 54.5%。反映了我們實施的更好的產品組合和成本改進的組合。我們更新後的毛利率前景高於我們先前的指引。然而，低於我們上半年實現的 55.3%，因為預計 2024 年下半年收入較低，這將導致吸收的固定成本水準高於先前的預測。

We now expect full year non-GAAP operating margin to be between 12% and 13% versus 13.5% to 14% in our prior guidance, reflecting a lower level of cost leverage in the second half, while we continue to carefully manage operating expenses. Full year adjusted EBITDA margin is expected to be between 18% and 19% versus 19.5% to 20% in our prior guidance.

我們現在預計全年非GAAP 營業利潤率將在12% 至13% 之間，而我們之前的指導則為13.5% 至14%，反映出下半年成本槓桿水平較低，同時我們將繼續謹慎管理營業費用。全年調整後 EBITDA 利潤率預計在 18% 至 19% 之間，而我們先前的指引為 19.5% 至 20%。

Finally, we expect to close the acquisition of certain technology assets that Andy mentioned earlier in the call and are anticipating a onetime in-process R&D charge of approximately $30 million likely in the third quarter or at the latest by the end of 2024. This will be incremental to the full year operating margin profile we've laid out above. That concludes our prepared remarks. We'll now open the line to take your questions. Operator?

最後，我們預計將完成對 Andy 先前在電話會議中提到的某些技術資產的收購，並預計在第三季或最遲在 2024 年底可能會產生約 3000 萬美元的一次性研發費用。這將增加我們上面列出的全年營業利潤率。我們準備好的演講到此結束。我們現在將開通電話回答您的問題。操作員？

(Operator Instructions) Patrick Donnelly, Citi.

（操作員指示）Patrick Donnelly，花旗銀行。

Hey guys. Thank you for taking the questions. Maybe to start on the margin side, obviously, a pretty nice performance in 2Q, but then, Roop, you just touched on to the cut for the year. Can you just talk about, I guess, what drove the strength in 2Q? And then, obviously, again, just that second half expectation margin down quite a bit there. Maybe just talk through the moving pieces as we work our way through the year and out of 2Q here?

嘿夥計們。感謝您提出問題。也許從利潤方面開始，顯然，第二季的表現相當不錯，但是魯普，你剛剛談到了今年的削減。我想你能談談是什麼推動了第二季的強勢嗎？然後，顯然，下半年的預期差值又下降了很多。也許只是談談我們在這一年和第二季結束時的工作進展？

Yeah, certainly, Patrick, good to talk to you. So first of all, maybe just to start -- I think just to remember, we are taking the overall gross margin up from a guide -- from where we were on the guide perspective based on the performance.

是的，當然，帕特里克，很高興與你交談。首先，也許只是開始 - 我想只是記住，我們正在從指南中提高整體毛利率 - 從我們基於業績的指南角度來看。

And so even in the second half of the year, we expect stronger gross margin than what we had originally guided. Q2 is kind of strength in the gross margin, specifically is associated with mix. But the other part of it is really sustained improvements based on our cost initiatives and efficiency improvements and things like logistics costs that we've been very proactively managing.

因此，即使在今年下半年，我們預期毛利率也會高於我們最初的預期。第二季是毛利率的優勢，特別是與組合相關。但另一部分確實是基於我們的成本計劃和效率改進以及我們一直非常積極管理的物流成本等方面的持續改進。

So those are the things that really helped Q2. And as we looked at these initiatives, the magnitude and timing can be a bit variable and so we saw it flow through in the second quarter. We do expect that to sustain into the second half of the year and beyond. With that said, as we look at kind of the revenue and what we expect to flow through our factories, we anticipate more under absorption in the factories and so we've been a bit conservative in giving kind of what that margin outlook is in the second half while still taking up the overall range of the margin for the year.

所以這些才是真正對第二季有幫助的事。當我們審視這些舉措時，其規模和時間可能會有所不同，因此我們看到它在第二季度得到落實。我們確實預計這種情況將持續到今年下半年及以後。話雖如此，當我們考慮收​​入的類型以及我們期望流經工廠的收入時，我們預計工廠的吸收更多，因此我們在給出利潤率前景方面有點保守。 。

Yeah. And then -- and just the margins as well? Just maybe talk through those with the SG&A line?

是的。然後──還有利潤？也許只是透過 SG&A 線與那些人談談？

Yeah, of course. Op margins, when I look at the actions we've taken on a proactive cost management and just efficiencies, productivity that we're driving throughout the different areas of OpEx, that's taking hold as well.

是的，當然。營運利潤率，當我審視我們在主動成本管理方面所採取的行動以及我們在營運支出的不同領域所推動的效率和生產力時，這也正在發揮作用。

I think part of the headwind on the OpEx, which then affects the op margin is just the fact that sales are coming down from where we originally expected. And therefore, the cost leverage, cost structure leverage isn't as strong yet even though we've got the gross margins improving. So that's simply flow through and we've been very proactive in terms of that headcount management through the year. I think one thing to keep in mind is from an operating expense standpoint. We've been very prudent in how we looked at headcount management and cost management. We'll see a little bit of uptick in the second half of the year just because of some of the projects and other things that we want to drive execution on it in the second half.

我認為，影響營運利潤的營運支出的部分阻力就是銷售低於我們最初預期的事實。因此，儘管我們的毛利率有所改善，但成本槓桿、成本結構槓桿還沒有那麼強。所以這只是流程，我們這一年在人員管理方面一直非常積極。我認為需要記住的一件事是從營運費用的角度來看。我們在如何看待員工管理和成本管理方面一直非常謹慎。我們將在下半年看到一些成長，只是因為我們希望在下半年推動一些專案和其他事情的執行。

Okay. That's helpful. Thanks. And then maybe just on process chrome. It seems like, obviously, some of the stocking lingering -- lingering here and obviously, it seems like that's a big part of the Life Science decline for the year.

好的。這很有幫助。謝謝。然後也許只是在工藝鍍鉻上。顯然，一些庫存似乎揮之不去——顯然，這似乎是今年生命科學下跌的重要組成部分。

Can you guys just talk about what you're seeing there? It seems like, again, you're taking out any sort of recovery for this year. But just what you need to see to kind of believe in a recovery there and visibility and just the different geographies? I know it seems like it's concentrated to a few customers, but maybe just pull the card back a little bit on that?

你們能談談你們在那裡看到了什麼嗎？看來今年你又要採取任何形式的復甦了。但你需要看到什麼才能相信那裡的復甦、可見度以及不同的地區呢？我知道它似乎集中於少數客戶，但也許只是將卡稍微拉回來一點？

Hey, Patrick, it's Andy. Yeah, I'll take that one. Yeah, I think, look the story here is a mixed bag. There are some positives. We're seeing a number of projects that we're engaged in improving in the first half and actually low double digit improvement. So that's a positive trend line. But those -- those small projects in early phase are not material revenue contributors in the first year.

嘿，派崔克，我是安迪。是的，我會接受那個。是的，我想，看這裡的故事好壞參半。有一些正面的方面。我們看到上半年我們正在改進許多項目，但實際上只有兩位數的改進。所以這是一條正面的趨勢線。但那些早期階段的小型專案並不是第一年的實質收入貢獻者。

The kind of pullback on our overall guidance on process chromatography is very much the same story as Q1. It's just a more acute understanding of the magnitude of destocking that a small handful of very large customers have to go through. And they've got multiple manufacturing facilities and it's been that struggle of getting full line of sight to all their sources of inventory. And so we -- we just being very prudent in our view on process chrome for the rest of this year and we expect to see recovery in '25.

我們對工藝色譜總體指導的這種回調與第一季的情況非常相似。這只是對一小部分非常大的客戶必須經歷的去庫存程度的更敏銳的理解。他們擁有多個製造設施，但要全面了解所有庫存來源卻很困難。因此，我們對今年剩餘時間的製程鉻的看法非常謹慎，我們預計 25 年會出現復甦。

Patrick, this is Roop. Maybe just to build on one part is the geo piece and based on the customers that Andy spoke of, it's in various geos. So it's not concentrated in any one geo.

派崔克，這是魯普。也許只是在一個部分上建立地理部分，並且根據安迪談到的客戶，它位於不同的地理區域。所以它並不集中在任何一個地理區域。

Okay. And then maybe just one last quick one. Just on the digital PCR side, obviously, always a focus for investors. Are you guys seeing anything different in that market, both competitively and just on the demand side? Would be helpful. Thank you guys.

好的。然後也許只是最後一個快速的。顯然，就數位 PCR 而言，始終是投資者關注的焦點。你們認為這個市場有什麼不同嗎，無論是競爭方面還是需求面？會有幫助的。謝謝你們。

I don't think we're seeing any real shift competitively that we've not already been seeing. Within the mix of life science overall, digital PCR instrumentation was the major factor again. Consumables were actually held up pretty well. And we -- and sequentially, quarter-to-quarter, we saw improvement. In fact, we saw quarter-to-quarter improvement broadly.

我認為我們沒有看到任何我們尚未看到的真正的競爭變化。在整個生命科學領域，數位 PCR 儀器再次成為主要因素。消耗品實際上保存得很好。我們——逐季度連續地看到了進步。事實上，我們看到了季度與季度之間的廣泛改善。

It's really the -- in the case of digital PCR, it's a pretty tough compare in Q2 of last year. The call out in the script of the onetime licensing fee and some of the -- kind of supply chain challenges that we actually managed to overcome in Q2 of prior year. So and as for the competitive situation, look, with maintaining our win rates in the segments we're focused in and we feel very positive about the long term outlook for digital PCR still.

就數位 PCR 而言，去年第二季的比較確實非常艱難。劇本中提到了一次性許可費以及我們在去年第二季度實際克服的一些供應鏈挑戰。因此，就競爭情勢而言，透過維持我們重點關注的細分市場的勝率，我們對數位 PCR 的長期前景仍然非常樂觀。

Yeah. I think the -- this is Roop. I would just add, we are going to see second half strength in DD PCR over the first half. So when we think about that, we're pleased with kind of as it's coming back.

是的。我認為——這是魯普​​。我想補充一點，我們將看到下半場 DD PCR 的強度超過上半場。所以當我們想到這一點時，我們對它的回歸感到高興。

Great. Thank you guys.

偉大的。謝謝你們。

Thanks, Patrick.

謝謝，派崔克。

Dan Leonard, UBS.

丹‧倫納德，瑞銀集團。

Thank you and good evening. At a high level, with the current guidance, do you think you've framed the operating environment appropriately or are there any areas where you're trying to be conservative or any further areas where you're speculating on improvement that you don't yet have visibility on?

謝謝你，晚上好。在較高的層面上，根據當前的指導，您是否認為您已經適當地構建了操作環境，或者是否有任何您試圖保持保守的領域，或者您在推測哪些方面需要改進但您並沒有這樣做還有可見性嗎？

Hey, Dan, this is Roop. Maybe I'll start. In terms of spect -- I think we framed it well in terms of what we're seeing and across the different areas. Obviously, from a Life Science Group, the process chrome is the area that, as Andy spoke up, we're seeing the greatest headwind, if you will.

嘿，丹，這是魯普。也許我會開始。就觀點而言——我認為我們根據我們所看到的以及不同領域的情況很好地構建了它。顯然，從生命科學小組來看，正如安迪所說，如果你願意的話，工藝鉻是我們看到最大阻力的領域。

And that really -- our position with these customers is very strong in terms of the end therapeutics that they support. Those are market leading therapeutics. And so we feel very good about that and it can't be displaced. It's just a matter of that destocking that's occurring there.

事實上，我們在這些客戶支持的最終治療方面的地位非常牢固。這些都是市場領先的療法。所以我們對此感覺非常好，而且它無法被取代。這只是那裡正在發生的去庫存問題。

As we just talked about DD PCR, we're seeing positive signals and expect that to grow. Clinical Diagnostics has been positive throughout the year and we expect it to have some normalized growth rate as we continue.

正如我們剛剛討論的 DD PCR，我們看到了積極的信號，並預計這一信號將會增長。臨床診斷全年都表現積極，我們預計隨著我們的繼續，它將會有一定的正常化成長率。

The margin is the one area that I framed, which is maybe a little bit more conservative, but part of this is mix being a contributor to our positivity so far. It's hard to predict mix exactly. And so we're mindful of that. And then as I mentioned, the under-absorption, beyond that, and I think we haven't touched on China and maybe in the questions. But China is the one variable that's an open question. The new stimulus that's been introduced.

邊緣是我所框定的一個區域，這可能有點保守，但其中一部分是到目前為止，混合對我們的積極性做出了貢獻。很難準確預測混合。所以我們注意到這一點。正如我所提到的，除此之外，吸收不足，我認為我們還沒有觸及中國，也許在問題中也沒有觸及。但中國是唯一一個懸而未決的變數。已經推出的新刺激措施。

It's interesting, but I'm not sure it will have that much of an impact. So we're again mindful of that. So I think we're trying to be very prudent in our view of what to layout for folks to expect in the second half, recognizing the markets are still dynamic and especially in a couple of the areas that we're playing in. And China is probably the one that's most variable for -- maybe not just us, but others as well.

這很有趣，但我不確定它會產生那麼大的影響。所以我們再次注意到這一點。因此，我認為我們在下半年的佈局上非常謹慎，因為我們認識到市場仍然充滿活力，尤其是在我們正在參與的幾個領域。中國可能是變化最大的國家——也許不只是我們，還有其他國家。

Understood. And thank you for elaborating on all those assumptions. Just a quick follow up. I know the single cell product has been a very high visibility R&D efforts at Bio-Rad for a couple of years now. You launched it in June. Hopeful that you could give any color on your go to market strategy or how to think -- we should think about framing that uptake?

明白了。感謝您詳細闡述所有這些假設。只需快速跟進即可。我知道幾年來單細胞產品一直是 Bio-Rad 的一項非常引人注目的研發工作。你在六月推出了它。希望您能夠對您的市場策略或思考方式給出任何意見—我們應該考慮建立這種吸收？

Yeah. Dan, it's Andy. Thanks for the question. And look, I think we're consistent in where we think the value proposition for the product offering sets, which is equal performance to the market leading solution, better value and a better workflow.

是的。丹，是安迪。謝謝你的提問。看，我認為我們對產品組合的價值主張是一致的，即與市場領先的解決方案具有同等的性能、更好的價值和更好的工作流程。

And we think the long term growth opportunity for single cell is solid. It's a sizable market. We expect it to continue to grow. I think the obvious acquisition of Fluent by Illumina is just kind of a testament to that. And I think that's going to kind of put more emphasis on value for the end market. We believe we've got a very well positioned product with the -- probably the best workflow of all the platforms. In terms of go to market, we've got a specialist focus in our early months of introduction to establish product performance and credibility out there with kind of key core labs and sensors.

我們認為單細胞的長期成長機會是穩固的。這是一個相當大的市場。我們預計它會繼續增長。我認為 Illumina 收購 Fluent 就證明了這一點。我認為這將更加強調終端市場的價值。我們相信我們已經擁有了一個定位非常好的產品，其工作流程可能是所有平台中最好的。在進入市場方面，我們在推出的最初幾個月就重點關注透過關鍵核心實驗室和感測器建立產品性能和可信度。

So that's the way we're approaching it as our platform value and we're kind of thinking about the work we'll do in the second half this year. We don't anticipate material revenue contribution that would change our outlook this year. But it's about building for next year.

這就是我們將其作為我們的平台價值的方式，我們正在思考今年下半年我們將要做的工作。我們預計實質收入貢獻不會改變我們今年的前景。但這是為了明年的建設。

Okay. Thank you, Andy.

好的。謝謝你，安迪。

Tycho Peterson, Jefferies.

第谷·彼得森，杰弗里斯。

Hey, good afternoon. Maybe you look at Life Sciences and backing out chrome, you're still down kind of 4% in the year. Most of your peers are flat. Can you maybe just talk a little bit about why that might be the case?

嘿，下午好。也許你看看生命科學並放棄了鉻合金，你今年仍然下降了 4%。你的同齡人大多是平淡的。您能否簡單談談為什麼會出現這種情況？

Yeah. I think we've got an element of mix that's playing into our disadvantage here, Tycho, amongst others and with the biopharma and digital PCR component. Maybe also a little bit with our qPCR business, since it was the beneficiary of a massive uplift in the COVID period. And we're still seeing some relative softness on recovery in qPCR instrumentation.

是的。我認為我們的混合元素在這方面發揮了我們的劣勢，第谷等公司以及生物製藥和數位 PCR 組件。也許我們的 qPCR 業務也有一點，因為它是新冠疫情期間大幅成長的受益者。我們仍然看到 qPCR 儀器的回收率相對較低。

So I think we've got that mix that's a little -- little bit against us relative to others. And the other -- depending on other folks on the reagent instrumentation mix where reagents are holding up better this year overall. And I'd say the last piece that I would call out, which we should not forget is Q2 was a pretty tough compare for us.

所以我認為我們的組合相對於其他人來說有點對我們不利。另一個 - 取決於其他人對試劑儀器組合的看法，其中試劑今年整體表現更好。我想說的最後一點，我們不應該忘記的是，第二季對我們來說是一個非常艱難的比較。

We had the onetime license fee. We actually, despite the market we're starting to pull back really by the end of Q1 last year, we actually were doing a fair bit of supply chain recovery during Q2. So I'll compare was a bit elevated to pass other focus as well.

我們有一次性許可費。事實上，儘管市場在去年第一季末開始真正回落，但我們實際上在第二季度進行了相當多的供應鏈恢復。所以我會比較一下，以傳遞其他焦點。

Okay. Capital deployment question, why not do a bigger buyback here? You've got peers buying $5 billion at 30 times earnings. You guys are 5 times extra carriers. Why don't do something more meaningful than the $500 million you just added to the repo?

好的。資本配置問題，為什麼不在這裡進行更大規模的回購？同行們以市盈率 30 倍的價格買入了 50 億美元。你們是 5 倍的額外帶因者。為什麼不做一些比剛剛添加到回購協議中的 5 億美元更有意義的事情呢？

Well, that's -- that's just -- that's the incremental authorization, I guess, and we're just mindful. I mean, those balance sheets that you referenced, Tycho, are large balance sheets. So that's one thing to keep in mind. With that said, we did close to $200 million through the Q2 period and through the blackout period, which we hadn't done.

嗯，我想，這就是增量授權，我們只是注意到了。我的意思是，第谷，你提到的那些資產負債表是大型資產負債表。所以這是需要記住的一件事。話雖如此，我們在第二季和停電期間賺了近 2 億美元，但我們還沒有這樣做。

So I think our actions speak to our perspective that we're undervalued. The $500 million in incremental authorization. I think it's a strong message from the Board and us. And when do you consider where our balance sheet is, that's a very reasonable percentage of our balance -- of our cash.

所以我認為我們的行為顯示了我們的觀點：我們被低估了。5億美元的增量授權。我認為這是董事會和我們發出的強烈訊息。當你考慮我們的資產負債表的情況時，你會發現這是我們現金餘額的一個非常合理的百分比。

And then are you committing to kind of prioritizing that over M&A? I mean that's the other side of it. Your peers are saying multiples are still too high?

那麼您是否承諾將其優先於併購？我的意思是這是事情的另一面。您的同行說市盈率仍然太高？

Yeah. I guess, I'll start and maybe Norman, if you'd like to add. Prioritization, I think, listen, part of it is the technical aspect of the share repurchase and where intrinsic values are and that's more of a technical answer.

是的。我想，我會開始，也許諾曼，如果你願意補充的話。我認為，優先順序的一部分是股票回購的技術方面以及內在價值所在，這更多是一個技術答案。

And so I wouldn't say we're necessarily prioritizing, but we're mindful and at the same time, M&A, the right deals have to come. And as you mentioned, valuations have to be appropriate for the right technologies and they have to contribute to our product roadmap and strategy. And so timing is an important part of that. So we look at both as opportunities to drive long term shareholder value creation.

因此，我不會說我們一定要優先考慮，但我們會注意，同時，併購，正確的交易必須到來。正如您所提到的，估值必須適合正確的技術，並且必須為我們的產品路線圖和策略做出貢獻。因此，時機是其中的重要組成部分。因此，我們將兩者視為推動長期股東價值創造的機會。

And then maybe last one on digital PCR. Just with the continuum launch coming, any risks ahead of the launch, freezing the market? It's been delayed a couple of times.

然後可能是關於數位 PCR 的最後一篇。連續推出即將到來，推出前有什麼風險，會凍結市場嗎？已經推遲好幾次了

Yeah, nothing outside of the normal risks that go with new product introduction and then all those final steps you go through. We're still targeting an initial entry in Q4. Really, it's about staging for next year, Tycho. Nothing more to add at this point, I don't think.

是的，除了新產品推出以及您經歷的所有最後步驟所伴隨的正常風險之外，沒有任何風險。我們的目標仍然是在第四季度首次進入。真的，這是關於明年的演出，第谷。我認為此時沒有什麼可補充的。

Understood. Thank you.

明白了。謝謝。

Thank you.

謝謝。

Jack Meehan, Nephron Research.

傑克·米漢，腎單位研究。

Thank you. Good afternoon. Norman, I wanted to ask you about the COO search. It sounds like there's still a few folks in the mix there. As you look at the group, is CEO potential still a high criteria? And I guess, how do you think about that relative to some internal candidates you might have in terms of succession planning?

謝謝。午安.諾曼，我想問你關於營運長搜尋的問題。聽起來那裡還有一些人。當你審視這個集團時，執行長潛力仍然是一個高標準嗎？我想，相對於您在繼任計劃方面可能擁有的一些內部候選人，您如何看待這一點？

Yeah. I think as we said before -- part of this -- part of evaluating the candidates has been a CEO of succession and that's still part of the -- that's still a critical part of the mix.

是的。我認為，正如我們之前所說，評估候選人的一部分是繼任首席執行官，這仍然是組合的關鍵部分。

Okay. And then I also wanted to ask your latest thoughts on the Sartorius stake and just thoughts around potentially monetizing that to fund buyback or near term M&A, if something presented itself? Just what's your latest thinking on kind of the strategic role of that state?

好的。然後我還想問一下您對賽多利斯股份的最新想法，以及關於可能將其貨幣化以資助回購或近期併購的想法，如果有東西出現的話？您對該國家的戰略角色有何最新看法？

Yeah. I mean it's -- we still do see it. It's a monetizable asset. I think that -- the question is what's the future with your team not extending its contract, certainly, his tenure has been really good for us. It's been really good for the company. And our investment has done really well. And I think, candidly, it's given us a much more valuable monetizable asset. But I guess at the end of the day, he's stepping down doesn't really impact our kind of overall views.

是的。我的意思是——我們仍然看到它。這是一種可貨幣化的資產。我認為——問題是你的球隊不續約的話未來會怎樣，當然，他的任期對我們來說真的很好。這對公司來說確實是好事。我們的投資效果非常好。坦白說，我認為它給了我們更有價值的可貨幣資產。但我想最終，他的下台並沒有真正影響我們的整體觀點。

Got it. Okay. And then I did have one cash flow question. Roop, on the relative inventory levels, I just kind of do some very basic benchmarking. Does look a bit bloated. Like if I look at inventory as a percentage of sales, maybe is one metric back in 2019 before the pandemic, it was around 24%. Today kind of annualized at over 30%. So maybe just it would be great to hear your thoughts like ability to start drawing this down to generate some cash? Are there any hurdles to doing that? Thanks.

知道了。好的。然後我確實有一個現金流問題。Roop，在相對庫存水準上，我只是做了一些非常基本的基準測試。看起來確實有點臃腫。就像如果我將庫存佔銷售額的百分比（也許是 2019 年大流行之前的一個指標）看出來，大約是 24%。今天年化利率超過30%。所以也許很高興聽到您的想法，例如能夠開始提取這筆錢來產生一些現金？這樣做有什麼障礙嗎？謝謝。

Yeah. Great point on that. You're spot on bloated. We haven't necessarily used that word, but we do think it's -- But I guess you pick your word. With all that said, we've got inventory. And some of it, quite honestly, has been purposeful because of the market, right? It's -- we needed to procure strategic materials to ensure continuity of supply. With that said, if I separate that out, we've got focused initiatives in terms of inventory reduction. Part of it is just operationally how we manage the sales and operations kind of alignment and there's improvements that are being made there.

是的。很好的一點。你已經很臃腫了。我們不一定使用過這個詞，但我們確實認為它是——但我想你選擇了你的詞。話雖如此，我們已經有庫存了。老實說，其中一些是因為市場而有目的的，對吧？我們需要採購策略物資以確保供應的連續性。話雖如此，如果我將其分開，我們在減少庫存方面採取了重點舉措。部分原因在於我們在營運上如何管理銷售和營運的一致性，並且正在那裡進行改進。

And we expect over time that that inventory will come down. And I'll say it more from an inventory turn standpoint, our inventory turns will improve, obviously, with revenue growth, you may see additional inventory on the balance sheet. But from an overall turns perspective, where we are today is unacceptable, and we're focused on improving that turns, which obviously will then drive stronger operating and free cash flow.

我們預計隨著時間的推移，庫存將會下降。我會從庫存週轉的角度更多地說，我們的庫存週轉率顯然會改善，隨著收入的增長，您可能會在資產負債表上看到額外的庫存。但從整體營收角度來看，我們今天的處境是不可接受的，我們專注於改善營收，這顯然將推動更強勁的營運和自由現金流。

Great. Thank you.

偉大的。謝謝。

Thank you. And it appears that we have no further questions at this time. I will now turn the program back to our presenters for any additional or closing remarks.

謝謝。目前看來我們沒有其他問題了。我現在將把節目交還給我們的主持人，請他們發表補充或結束語。

Thank you for joining today's call. We will be at the Wells Fargo Healthcare Conference in Boston in early September and hope to catch up with some of you in person. As always, we appreciate your interest, and we look forward to connecting soon. Thank care.

感謝您參加今天的電話會議。我們將於九月初參加在波士頓舉行的富國銀行醫療保健會議，並希望親自與你們中的一些人見面。一如既往，我們感謝您的關注，並期待盡快建立聯繫。謝謝關心。

Thank you. This concludes today's presentation. Thank you for your participation. You may disconnect at any time.

謝謝。今天的演講到此結束。感謝您的參與。您可以隨時斷開連線。