Why Are Cryoport Shares Plunging Today?

Cryoport Inc CYRX shares are trading lower after the company released certain preliminary results for Q2 FY23 and updated its revenue expectations for FY23.

The company expects Q2 sales of $56.5-$57.5 million, representing a decrease of 11%, at the midpoint, compared to Q2 2022 and well below the consensus of $67.4 million. 

These results reflect weaker-than-expected global demand for capital equipment, clinical trial start delays, and slower-than-expected ramps from certain clients.

Jerrell Shelton, CEO of Cryoport, commented, "Based on our conversations with clients and third-party sources, we expect life sciences fundamentals to remain strong for the longer term. Unfortunately, there has been a global slowdown in capital equipment investment. The impact of this unexpected slowdown was further exacerbated by a number of clinical trial start delays and several key customers falling short of their forecasts for the revenue ramp of certain cell and gene therapies. We expect some of these challenging conditions to persist into the third and fourth quarters of 2023."

Cryoport has also lowered its FY23 sales outlook to $233-$243 million, down from prior guidance of $270-$290 million and falling behind the consensus Of $274.85 million.

Mr. Shelton continued, "The impact to our business from the factors outlined above was abrupt and significant. We are, however, positive about our long-term outlook as the cell and gene therapy industry is expected to grow at a ten-year compound annual growth rate (CAGR) in excess of 22%."

The company expects to report its full second quarter 2023 financial results on August 9, after U.S. markets close.

Price Action: CYRX shares are down 24.70% at $14.59 during the premarket session on the last check Thursday.