Intelligent Bio Solutions: Higher-Margin Sales Drive Q2 Profitability

Intelligent Bio Solutions Inc. (INBS) is expected to record increased profitability in the second quarter, driven by higher-margin sales. The medical technology company, which specializes in rapid, non-invasive testing solutions, has seen a significant shift in its product mix towards higher-margin cartridges used in its Intelligent Fingerprinting Drug Screening System. This strategic focus, coupled with increased sales volume, has contributed to the company's improved gross profit margin.

In the six months ended December 31, 2024, INBS' gross profit margin increased by 11 points to 38.5%, compared to the same period the prior year. This substantial improvement can be attributed to two key factors: the shift in product mix towards higher-margin cartridges and increased sales volume. The Company's strategic focus on maximizing recurring revenue from cartridge sales has driven this increase, with cartridge sales outpacing reader sales and serving as a primary source of recurring revenue with a higher profit margin.



Harry Simeonidis, President and CEO of INBS, commented on the Company's strong financial performance, stating, "Our strategic focus on higher-margin cartridge sales is driving a significant 11-point expansion in gross profit margin, reinforcing the strength of our business model." This trend is expected to continue, as the Company's growing customer base and expanding global footprint ensure a steady stream of recurring revenue.

Spiro Sakiris, CFO at INBS, also expressed confidence in the Company's financial outlook, noting, "Our Q2 and six-month results are very encouraging, showing strong growth compared to 2022 as we continued our focus on penetrating target markets." The Company's focus on safety-critical sectors and the continuous demand for cartridges to operate the readers ensure a steady stream of recurring revenue, contributing to the sustainability of these trends.

In addition to the shift towards higher-margin cartridge sales, INBS has implemented several strategic initiatives to drive recurring revenue and expand its customer base. These include expanding into new markets, forming strategic partnerships, and pursuing FDA 510(k) clearance for its Intelligent Fingerprinting Drug Screening System. These efforts have proven effective, as evidenced by the Company's significant revenue growth and customer account increases.

As INBS continues to execute its strategic plan, investors can expect the Company to maintain its focus on higher-margin cartridge sales, driving long-term revenue growth and profitability. The Company's growing customer base, expanding global footprint, and strategic partnerships position it well for continued success in the medical technology sector.