Company: RPID
Filing Date: 2025-08-12
Form Type: 10-Q
Source: 0001380106-25-000174
Chunk: 359

Company: RAPID MICRO BIOSYSTEMS, INC.
Filing Date: 2025-08-12
Form: 10-Q
Item: Part I, Item 8
Chunk 359
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 expanding and continuously enhancing the Growth Direct platform, we believe we can drive incremental revenue from existing clients as well as broaden the appeal of our solutions to potential new customers.

We made the Growth Direct Rapid Sterility application available for commercial sale and placed the first Rapid Sterility system at one of our existing customers in the second quarter of 2024. We plan to continue efforts to scale our manufacturing capabilities for the Rapid Sterility application.

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Revenue mix

Our revenue is derived from sales of our Growth Direct systems, our LIMS connection and RMBNucleus Mold Alarm software, proprietary consumables, and services. Growth Direct system revenue involves a capital selling process and tends to be somewhat concentrated within a relatively small (but varied) group of customers each year, so it is subject to variability from quarter to quarter.

Gross margin improvement

The majority of our customers are large, global pharmaceutical manufacturers and CDMOs. In order to meet the expectations of our customers, we have made significant investments to build infrastructure and develop capabilities in areas such as procurement, manufacturing, distribution, quality and after-sales service. Since the third quarter of 2024, when we achieved positive gross margins for the first time in our company's history, we have maintained positive gross margins each quarter. Maintaining these positive gross margins in future periods will depend on our ability to execute on our business objectives, including generating sufficient revenues to cover the costs of producing and delivering our products and services. In order to further grow our gross margins, we are actively targeting numerous areas including:

•Reducing instrument and consumable product costs (materials and labor) through activities including strategic sourcing and product redesign; 

•Increasing product manufacturing efficiency through activities including increased throughput on our automated consumables manufacturing line and manufacturing process optimization;

•Increasing productivity and efficiency in our service organization;

•Increasing achieved pricing of our existing products and services; and

•Introducing and expanding new, higher margin products and services.

At the same time, we also expect future revenues from both products and services to grow at rates significantly higher than the related costs to provide and support those products and services.  As a result, we also expect increasing revenues from both products and services to contribute significantly to future gross margin expansion. While we expect gross margins to continue to trend positively in the future, expansion in gross margins in future periods may not be linear and may be subject to variability from period to period.

Key business metrics

We regularly review the following key business metrics to evaluate our business, measure our performance, identify trends affecting our