Avid Bioservices Inc (NASDAQ:CDMO) stock plunges 14.10% (As on June 22, 11:27:39 AM UTC-4, Source: Google Finance) though the company surpasses the estimates for both topline and bottom line for the fourth quarter of FY 23. For the quarter, the increase in revenues can primarily be attributed to increases in manufacturing runs and process development services provided to new customers. As of April 30, 2023, the company’s revenue backlog was $191 million, representing an increase of 25% compared to $153 million at the end of the fourth quarter of fiscal 2022. The company expects a growing portion of the backlog will extend beyond a year. For the fourth quarter of fiscal 2023, the company recorded a net loss of approximately $0.3 million as compared to net income of $115.6 million for the fourth quarter of fiscal 2022. Avid reported $38.5 million in cash and cash equivalents as of April 30, 2023, compared to $126.2 million as of April 30, 2022.

Further, gross margin for the fourth quarter of fiscal 2023 was 21%, and in-line as compared to a gross margin of 22% for the fourth quarter of fiscal 2022. During the three months ended April 30, 2023, as compared with the same prior year periods, the labor, overhead, and depreciation expenses increased primarily due to the hiring of personnel and additional facility, equipment and related costs ahead of our mammalian and cell and gene therapy CGMP facility expansions. This decrease in margin was partially offset by a current year period benefit to margin from revenue associated with a change in variable consideration under a contract where uncertainties have been resolved. In addition, the same period in the prior year included a margin benefit from unutilized capacity fees. Meanwhile, the company’s commercial team signed multiple new orders during the fourth quarter, totaling approximately $55 million net. These orders are with new and existing customers, and span all areas of the business, from process development to commercial manufacturing.

CDMO in the fourth quarter of FY 23 has reported the adjusted earnings per share of 5 cents, beating the analysts’ estimates for the adjusted earnings per share of 1 cents. The company had reported the adjusted revenue growth of 28 percent to $39.8 million in the fourth quarter of FY 23, beating the analysts’ estimates for revenue of $38.91 million.

Avid Bioservices sees FY 2024 revenue in the range of $145.00M-$165.00M versus the analyst consensus of $181.27M.