OmniAb — Third Quarter 2026 Earnings Summary

Financial Performance:

• Third quarter 2026 revenue was $4.0 million, up from $2.2 million in the prior-year period, driven by service revenue and xPloration revenue.
• Year-to-date revenue for the nine months ended September 30, 2026, was $31.8 million, compared to $10.3 million in the same period in 2025, primarily driven by milestone revenue.
• Net loss for the third quarter of 2026 was $15.7 million ($0.12 per share), compared to $16.5 million ($0.14 per share) in the prior-year period.
• Net loss for the nine months ended September 30, 2026, was $29.3 million ($0.23 per share), compared to $50.6 million ($0.46 per share) in the prior-year period.
• Cash costs and operating expenses were $13.7 million for the third quarter of 2026, compared to $12.3 million in the prior-year period.
• Cash costs and operating expenses were $39.2 million for the nine months ended September 30, 2026, compared to $38.9 million in the prior-year period.
• As of September 30, 2026, the company held $64.2 million in cash, cash equivalents, and short-term investments.
• Deferred revenue increased to $14.973 million (current: $5.238 million; long-term: $9.735 million) as of September 30, 2026, from $3.161 million (all current) as of December 31, 2025.

Guidance and Future Outlook:

• Full-year 2026 revenue guidance was raised to $35 million to $39 million, up from the previous range of $32 million to $36 million.
• Full-year 2026 costs and operating expenses guidance is $83 million to $87 million, down from $84 million to $88 million.
• Full-year 2026 cash costs and operating expenses guidance is $50 million to $54 million, down from $51 million to $55 million.
• The company now expects to end 2026 with cash and cash equivalents between $53 million and $57 million, up from $49 million to $53 million.
• The full-year 2026 effective tax rate is expected to be approximately 0%.
• xPloration revenue is expected to be between $2 million and $3 million in 2026, with expectations to double in 2027 and double again in 2028.

Business Segments and Product Lines:

• Service revenue increased due to higher work performed on antibody and ion channel programs.
• xPloration revenue increased due to higher instrument sales and related consumables; cost of xPloration revenue was $0.3 million in Q3 2026 compared to $0.03 million in Q3 2025.
• OmniAb entered into a new global collaboration and license agreement with Eli Lilly and Company for an undisclosed ion channel program, receiving an up-front payment and eligible for up to $370 million in milestone payments plus tiered royalties.
• OmniAb launched OmniTides, a new peptide discovery offering powered by the OmniUltra™ transgenic chicken platform, providing an integrated discovery-to-synthesis workflow.
• The xPloration platform expanded commercial access in October 2026, making the AI-powered, high-throughput single B-cell screening platform available for purchase by all customers, addressing an estimated market opportunity of over $500 million.
• As of September 30, 2026, the company had 111 active partners and 433 active programs, including 34 OmniAb-derived clinical and commercial programs.

Market and Competitive Landscape:

• The expanded commercial launch of xPloration addresses an estimated market opportunity of more than $500 million and is expected to create synergistic opportunities across business lines.
• Partner program highlights include positive Phase 2a results for Teva's TEV-’408 in celiac disease and NMPA approval in China for Harbour BioMed's batoclimab for generalized myasthenia gravis.
• Merck KGaA's Phase 3 trial for precemtabart tocentecan (M9140) for metastatic colorectal cancer is ongoing.
• Immunovant expects updates on IMVT-1402 for rheumatoid arthritis in the second half of 2026, with registrational trial data anticipated in 2027 for Graves' disease and myasthenia gravis.

Risks and Challenges:

• Future operating results depend on the acceptance of the technology platform by new and existing partners and the eventual development, approval, and commercialization of partner products.
• Biopharmaceutical development is inherently uncertain, and the company has no control over partner development plans, regulatory strategies, or commercialization efforts.
• Risks include reliance on a limited number of third-party manufacturers and suppliers for xPloration instruments and consumables.
• Potential risks include failure to maintain intellectual property rights, unexpected higher operating expenses, and the possibility of not achieving financial guidance or projected xPloration revenues.

Management Commentary and Tone:

• CEO Matt Foehr stated that strong third-quarter performance reflects licensing execution and a focus on driving value within an efficient business model.
• Management expressed confidence in the durability of the revenue base and long-term growth potential, citing the expanded commercial launch of xPloration, the introduction of OmniTides, and progress across partnered programs.
• Management noted the increase in costs and operating expenses was driven by higher external expenses, including legal and public company costs, partially offset by lower share-based compensation.

Other Key Points:

• OmniAb hosted an Investor & Analyst Day in October 2026 to highlight expanded commercial access to xPloration and introduce OmniTides.
• The company recorded a $2.9 million non-cash impairment related to the discontinuation of certain legacy small-molecule ion channel programs in the first quarter of 2026, contributing to increased amortization of intangibles for the nine-month period.
• A $3.0 million one-time gain from the sale of a small-molecule program was included in other operating income for the same period in 2025.
• The company's effective tax rate for the full year 2026 is projected to be approximately 0%.