Oxford Nanopore Technologies Tops Revenue Guidance With 24% Growth Despite NIH, China Headwinds

Oxford Nanopore Technologies (LON:ONT) Chief Financial Officer Nick Keher said the company delivered revenue growth ahead of its initial guidance despite what he described as a “challenging backdrop,” pointing to pressures including U.S. NIH funding uncertainty, continued difficult trading conditions in China tied to geopolitics and restricted customer lists, and tariff-related news during the year.

Speaking in a discussion hosted by European Healthcare equity research lead Charles Weston, Keher said Oxford Nanopore achieved 24% constant currency revenue growth for the year, above its earlier 20%-23% target. He added that growth exceeded 20% constant currency in each region, with the Americas seeing particularly strong momentum in the second half.

Regional and end-market performance

Keher emphasized that Oxford Nanopore saw growth across its product ranges and highlighted faster expansion in newer end markets. He said clinical revenue grew more than 60% for the year, biopharma grew 30%, applied industrial grew 27%, and research grew 15%, which he characterized as strong relative to the broader market.

On regional mix, he said the Americas now derive more than half of revenue from non-research segments (applied industrial, clinical, and biopharma). He contrasted that with EMEA, where research remains a larger share, and Asia-Pacific, where distributor reporting affects the way revenue is categorized.

• Americas: Keher said academic research was flat for the year, while research and government combined rose in the single digits. He described conditions as “stable” but said the company has not yet seen a full rebound to “normality.”
• EMEA: Academic growth was over 20% and clinical growth exceeded 50%, with continued activity including work tied to the European Long Read Initiative (ELRI) and other projects.
• APAC: Growth was affected by the roll-off of the PRECISE contract, which he described as a $3 million benefit in the prior-year second half but zero in the most recent second half. He also cited China as a drag on growth even though it remains positive.

Keher said China represented about 8% of total revenue in 2024 (roughly one-third of Asia-Pacific revenue), and he noted additional competitive pressure from local nanopore players there. He said the company views itself as the “premium product” in a two-tier market and is assessing how to improve operations in China, but he did not signal a near-term shift in trajectory.

Product positioning: flow cells and devices

Keher framed product relevance primarily through flow-cell capability. He described the MinION flow cell as producing about 30 gigabases of data, making it suitable for small genomes and targeted human sequencing, but not for whole human genome sequencing due to output limitations. In that context, he outlined use cases for MinION and GridION (which supports five MinION flow cells with onboard compute), including targeted sequencing for rare disease and infectious disease, and “locked down” GridION configurations for certain biopharma QC applications.

He said the PromethION flow cell produces more than 100 gigabases and is applicable to whole human genome sequencing as well as higher-throughput versions of MinION applications. He added that internal analysis of “47 market segments” suggested PromethION overlaps with most high-priority markets, with the P2i highlighted as broadly applicable due to onboard compute and the ability to “daisy chain” units for scaling. Keher also noted that customers increasingly go “straight for the P2i and the PROM” rather than progressing through earlier devices.

Applied industrial: plasmid sequencing and Sanger displacement

In applied industrial, Keher said the fastest growth was in APAC, driven partly by Sanger sequencing providers switching to Oxford Nanopore’s platform for plasmid sequencing and other tests historically conducted on Sanger. He cited China restrictions as a factor that kept applied growth below the roughly 40% seen the prior year.

On competitive dynamics among plasmid sequencing providers, he said increased competition in the U.S. is affecting providers’ pricing, but not Oxford Nanopore’s pricing directly. Instead, providers are working to increase throughput by putting more plasmids on each flow cell.

He also discussed a new chemistry initiative introduced at London Calling, describing it as early-access/beta and primarily aimed at improving output for whole human genome sequencing by keeping pores open longer. Keher said the company is thinking carefully about how to position and roll out the chemistry, including the possibility of running two PromethION flow-cell variants and limiting applicability to certain sample types and use cases.

Clinical and biopharma: growth, partnerships, and product adjustments

Keher said clinical growth was driven by areas including rare disease and infectious disease, with oncology “building,” particularly use cases requiring rapid turnaround such as blood cancers. He also pointed to potential step-changes tied to partners, naming bioMérieux and Cepheid and suggesting “quite a bit” could emerge over the next 24 months, which he said could influence the company’s 2027 outlook.

In biopharma, he described a second-half acceleration after 19% growth in the first half and 40% year-over-year growth in the second half. He attributed part of the improvement to increased traction in QC applications, citing examples including sterility testing at a large European biopharma from a centralized facility with plans for rollout to additional sites, and a large mRNA customer using the platform for QC in a clinical trial. However, he said the company had hoped to grow faster and acknowledged both market inertia and internal execution factors, including the need to better align product development with customer requirements.

Keher said Oxford Nanopore is preparing a “GridION version two” for the Q-Line, describing it as feature tweaks rather than a wholly new device, with launch activity occurring “now.”

Cash position, cost actions, and longer-term targets

Keher said the company ended the year with GBP 302 million of cash, ahead of market expectations, citing working capital improvements, especially inventories. He said the company is not pursuing acquisitions and intends to maintain focus until reaching cash flow breakeven.

On the shift to a CapEx sales model (selling devices outright rather than placing them with quasi-lease economics), Keher said the company notified customers in January and went live February 5, missing some customer budget cycles. He said P24 volumes were down year-on-year during the transition, but by year-end, larger device sales were effectively 100% CapEx outside of certain large tender-style programs. He estimated the model shift has improved cash flow by about GBP 20 million per year and provided a 300-400 basis point structural benefit to gross margin.

He also said Oxford Nanopore had more than GBP 100 million of inventory at the end of 2024 (net of provisions) and characterized inventory optimization as a meaningful source of cash improvement.

On internal restructuring, Keher said the company reduced headcount by 5% early in the year, mainly in SG&A, while reallocating resources toward commercial teams focused on clinical, applied, and biopharma. He also said it removed around 75-80 people in November after decisions to discontinue certain R&D projects that did not align with the company’s prioritized market segments.

Keher reiterated the company’s targets of EBITDA breakeven by 2027 and cash flow breakeven by 2028, emphasizing that controlled operating expense growth and gross margin improvement are key components. He acknowledged that achieving the implied acceleration in revenue growth adds risk, but said the company remains committed to the breakeven goals and would consider modulating the cost base if top-line growth underperforms.

About Oxford Nanopore Technologies (LON:ONT)

Oxford Nanopore Technologies’ goal is to bring the widest benefits to society through enabling the analysis of anything, by anyone, anywhere. The Group has developed a new generation of nanopore-based sensing technology that is currently used for real-time, high-performance, accessible, and scalable analysis of DNA and RNA. The technology is used in more than 125 countries, to understand the biology of humans, plants, animals, bacteria, viruses and environments as well as to understand diseases such as cancer.