2024-05-10 11:08:26 ET
Summary
- Ginkgo Bioworks' first quarter earnings were weak, with revenue and guidance falling well short of expectations.
- The company is shifting its business model away from ownership of IP and participation in downstream value, undermining the bull case.
- Ginkgo now appears to be moving towards a traditional CRO business model and should be valued as such.
Ginkgo Bioworks' ( DNA ) first quarter earnings were concerning for a number of reasons. Revenue and guidance were both weak, but perhaps more importantly, Ginkgo is pivoting its business model, indicating serious issues. Ginkgo is shifting away from ownership of IP and participation in downstream value, which completely undermines the primary reasons for investing in the company. This was always a risk, particularly with Ginkgo shifting its focus towards more mature pharma and biotech customers....
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Ginkgo Bioworks: Broken Narrative