Teknova Q2 2026 Earnings: Revenue Growth Drives Higher Guidance

Teknova (Nasdaq: TKNO) reported fiscal Q2 2026 revenue of $12.2 million, up 18% from $10.3 million a year earlier, while GAAP diluted EPS improved to a loss of $0.06 from a loss of $0.07. Gross margin expanded by 1.4 percentage points to 40.1%, and free cash outflow narrowed to $0.6 million from $2.3 million.

Core financial results

Revenue growth outpaced the increase in operating expenses, helping Teknova reduce its operating and net losses. Gross profit rose faster than revenue, although adjusted EBITDA remained negative.

The gross margin improvement primarily reflected higher revenue. Teknova said this benefit was partly offset by higher fixed costs absorbed into cost of goods sold due to faster finished-goods inventory turns, while the prior-year quarter had benefited from unusually favorable manufacturing-efficiency gains.

Adjusted EBITDA and free cash flow are non-GAAP measures. Teknova defines free cash flow as operating cash flow less purchases of property, plant and equipment.

Business and segment performance

Growth was broad across Teknova’s two main revenue categories. Lab Essentials remained the largest business and contributed most of the dollar increase, while Clinical Solutions also grew 18%.

Lab Essentials represented roughly three-quarters of quarterly revenue. Other revenue grew at the fastest percentage rate but remained a relatively small part of the total.

Teknova also launched Build-Tek™, its AI-powered custom order configurator, after a Q2 beta release. The company said the tool allows therapeutic and diagnostic developers to configure complex custom products in minutes, but it did not quantify any revenue contribution from the launch.

Revenue growth narrowed losses, but costs still exceed gross profit

Gross profit increased by $0.9 million year over year, while operating expenses rose by about $0.4 million. That difference reduced the operating loss by approximately $0.5 million to $2.9 million, showing improved operating leverage without reaching profitability.

Sales and marketing expense increased to $2.1 million from $1.6 million, driven by additional headcount and higher marketing spending. General and administrative expense declined to $4.8 million from $4.9 million, partly because of lower stock-based compensation. Even after the improvement, total operating expenses of $7.8 million remained well above quarterly gross profit of $4.9 million.

Cash flow and balance sheet

The improvement in cash consumption was more pronounced than the reduction in the net loss. The quarterly change in inventories used $0.4 million of cash, compared with $1.5 million a year earlier, while capital spending declined to $0.1 million from $0.2 million. These factors helped reduce free cash outflow to $0.6 million.

At June 30, 2026, Teknova held $6.0 million in cash and cash equivalents and $11.4 million in short-term investments, for combined liquidity of $17.4 million. Total borrowings were $13.2 million. Combined cash and short-term investments had declined by approximately $3.9 million from December 31, 2025, while free cash outflow for the first six months of 2026 totaled $4.2 million.

2026 guidance

Teknova raised its full-year revenue outlook and improved its free cash outflow outlook following the Q2 results. The materials did not provide the previous quantitative ranges, so the size of each revision cannot be calculated.

The guidance covers the fiscal year ending December 31, 2026.

Management commentary

CEO Stephen Gunstream said the company achieved quarterly revenue above $12 million for the first time, with growth across nearly all served end markets. He attributed the performance to investments in Teknova’s commercial organization, facilities and manufacturing systems, alongside an ongoing recovery in the biotech market.

CFO Matt Lowell linked the higher revenue guidance and lower expected cash outflow to the quarter’s 18% revenue growth and improvement in free cash flow.

Recent insider transactions

The supplied insider transaction records show direct purchases by Teknova’s CEO and CFO on March 6, 2026, along with a director sale and stock awards from June 2025. The records provided transaction values but not share quantities.

These records describe the transactions but do not establish the insiders’ views about Teknova’s future performance.

Risks investors should monitor

• Continued losses: Teknova remained unprofitable on GAAP and adjusted EBITDA bases. Revenue and gross profit must continue growing faster than operating costs for the company to approach break-even.
• Execution against higher guidance: The raised revenue range depends on sustained demand across Lab Essentials, Clinical Solutions and other end markets. Delayed or paused customer orders could affect that outcome.
• Margin sustainability: Q2 gross margin benefited from higher revenue but faced pressure from fixed-cost absorption related to inventory turns. Manufacturing efficiency and product volume could continue to influence margins.
• Ongoing cash consumption: Free cash outflow improved substantially but remained negative, while cash and short-term investments declined during the first half. Continued cash burn would reduce the company’s liquidity buffer.
• Commercial spending efficiency: Higher sales and marketing investment supported the expanded commercial organization, but it will need to generate sufficient additional gross profit to offset the higher cost base.

Summary

Teknova’s Q2 2026 results combined broad-based 18% revenue growth with a higher gross margin, narrower losses and substantially lower cash outflow, giving management enough confidence to raise full-year revenue guidance. The main questions now are whether the company can sustain segment growth and margin gains, convert higher commercial spending into additional gross profit, and continue reducing cash consumption while executing against its updated outlook.