Harvard Bioscience Q2 2025: Unpacking Contradictions in NIH Funding, Refinance Terms, and China Market Outlook

NIH Funding and Budget Improvements, Refinance Terms and Rate Expectations, NIH Funding and Budget Expectations, CRO Revenue and Impact on Company Revenue, and China Market Stability and Growth are the key contradictions discussed in Harvard Bioscience's latest 2025Q2 earnings call.



Revenue Performance:
- Harvard Bioscience reported revenue of $20.5 million for Q2 2025, exceeding guidance of $18 million to $20 million but lower than the previous year's $23.1 million.
- Revenue decline was mainly attributed to a lack of budget clarity for academics and NIH, as well as tariff impacts on the Chinese market.

Operating Expense Reduction:
- The company achieved a $2 million decline in operating expenses from the prior year, driven by actions such as moving to a U.S. ERP system and reprioritizing NPI projects.
- This led to an improvement in adjusted operating income of $1 million, contributing to a strong adjusted EBITDA of $1.5 million.

Gross Margin and Cash Flow Management:
- Gross margin improved sequentially to 56.4%, despite a decline from the previous year's 57.2%, primarily due to lower absorption of fixed manufacturing overhead costs.
- Year-to-date cash flow from operations was strong at $5.7 million, with $2.8 million generated in the second quarter, driven by working capital management and operating expense reductions.

Strategic Focus on Product Adoption:
- Harvard Bioscience focused on accelerating product adoption with new product launches and strategic partnerships, such as shipments of the SoHo Telemetry platform and progress in the VivaMARS automation pilot.
- These efforts aim to position the company for future growth in high-value markets with structural tailwinds.