Company: RPID
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0001380106-25-000200
Chunk: 7

Company: RAPID MICRO BIOSYSTEMS, INC.
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 2
Chunk 7
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 can also occur as customers advance through the Growth Direct platform adoption cycle, from early validation of initial applications to validation and conversion of multiple applications on the Growth Direct platform, or as the result of new product approvals or increases in their manufacturing volumes for existing products.

Innovating and launching new products on the Growth Direct platform

We believe the depth, scalability and robust capabilities of our Growth Direct platform allow us to address key opportunities and challenges facing MQC testing in the pharmaceutical industry. As an innovative leader in automated MQC testing, we intend to invest in further enhancements in our existing Growth Direct platform as well as end-to-end workflow solutions in our core market. We plan to further invest in research and development to support the expansion of our Growth Direct platform through development and launch of new applications to capture greater share of customer testing volume, new product formats to broaden our ability to serve different market segments and launch of new products and technologies to address adjacent segments of the overall MQC workflow. We plan to continue to hire employees with the necessary scientific and technical backgrounds to enhance our existing products and help us introduce new products to market. We expect to incur additional research and development expenses as a result. By 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.

Revenue mix

Our revenue is derived from sales of our Growth Direct systems, our LIMS connection and 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.

37

Gross margin improvement

The majority of our customers are large, global pharmaceutical manufacturers and contract development and manufacturing organizations. 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