Bruker Corporation (BRKR) Earnings Call Transcript & Summary

All right. Good morning, everyone. I'm Tejas Savant, I cover the Life Sciences here at Morgan Stanley. Before we begin, for important disclosures, please see the Morgan Stanley research disclosure website at morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales rep. So it's my pleasure to host Bruker this morning. And speaking on behalf of the company, we have Chairman, President and CEO, Frank Laukien; and CFO, Gerald Herman. So welcome, guys. I appreciate you joining us.

Maybe just to set the stage, Frank, '24 has been quite the transformational year for Bruker, multiple acquisitions, top line growth that's come in handily above the end markets, even though the end markets have been in a tough spot. Talk to us about how the years played out so far versus your initial expectations? And what are you most proud of over the last 12 months?

Yes. Well, first of all, Tejas, it's really a pleasure to be here, and thank you for having us. Good morning, everyone. So 2024, our core business, which is 90% of what we're doing, although right now, people talk a lot about the acquisitions, right, is doing really well. It's doing relatively very well. If you recall, the 3 prior years, we had constant -- we had organic revenue growth and constant exchange rate growth that was greater than 10%. So outperforming the industry. We are a fast growth company now with our repositioning for the post-genomic era tools, in particular, that's where the funding will be over the next 15 years, more so than the last 15 years that have been more traditional LC and genomics driven. So fundamentally, the strategy is working in our core business this year, our guidance for organic revenue growth is 5% to 7%. And yes, we have a lot of acquisition growth. So our constant exchange rate growth will be in the mid-teens. So again, transformative 4 years, all cumulative growth of about 70%. So we are a different company today than we are even 4 years ago. So that continues to do well, but we have headwinds. I mean this year, China is a headwind on the revenue, and biopharma is a headwind. And we have all learned that that biopharma headwind hasn't dissipated yet, right? Now we're talking about -- it's something -- it's getting better in '25. But nonetheless, if the markets are flat this year or maybe they're down 1% or 2%, I don't know what the average will be, us being outperforming again by 500 or 600 bps or something in that frame, I think is really doing very well. A lot of that has continued strong orders. Some of that is also we use our backlog, which had been at a very high level previously because -- and cushioning this downturn a little bit by bringing down our backlog a little bit. We still have a couple of years to go to bring that to a more normalized 5 months backlog level. Right now, we're at 7. So that combination has really cushioned. I think that's the core. That's the story about the core business. The other really important point on the core business, we're continuing to using our Bruker management process to grow our organic operating margin. With our Bruker management process that we've established about 10 years ago with the new group structures and very, very capable group presidents, we had expanded over 8 years our operating margin by 1,000 bps, starting from a lower level, but nonetheless, very, very solid, steady margin improvement. And we've done it the right way to build industry leaders. We've done it with gross margin improvement by 750 bps. And yes, we also got 250 bps of operating margin leverage. So it came down very nicely. And that's really what we're applying to the new acquisitions. I'm sure we're going to talk about those some more. That's kind of the -- that plus then some very strategic acquisitions when we could do them at attractive value dislocation that we have -- we had an extreme value dislocation in '21. Some of the assets we purchased traded at $3 billion and at $8 billion, respectively. Now we could buy very strategic assets in single cell, in spatial, in sample-to-answer molecular diagnostics, in a condensed time period, admittedly, that has maybe surprised -- that has definitely surprised the Street, but I think it gives us the opportunity to build very high ROIC businesses. And of course, use our management process to pretty quickly build these businesses back towards breakeven where they're not yet or take their margins as in the other tech case and drive them very significantly higher. That's the big picture story.

Lots to unpack there, Frank.

Exactly.

Maybe we'll start with instrument demand. You have pretty heavy instrument exposure. The macro has been challenging. And your instruments are big-ticket items. They're not sort of cheap to purchase. So despite that, you've been delivering solid performance year-to-date. You talked about the 5% to 7% organic growth. How has Bruker been able to execute and deliver above-market growth in the challenging macro? Part of that is innovation and you did launch a couple of interesting instruments at ASMS earlier this year as well. So just unpack that for us a little bit.

Yes. No, I -- Hey, I don't let anybody tell you that aftermarket is where it's all at. I mean, instruments business is great. Actually, the combination, the balance is great, I like a balance. But the instruments business, and we make $20,000 and $50,000 instruments as well. And yes, we make some multimillion-dollar NMRs or $1 million mass spectrometers. We have a broad range. But it very often allows you to innovate. You don't just go after the market, you follow the market. It allows you to innovate and create new areas like mass spec-based proteomics. I mean Team Red is doing a good job with Cryo-EM, right? Those are big ticket items. We don't do that, right? We build NMRs. We're doing a good job there. So there's a lot of opportunity in creating new spaces that you can that often are instrument, and initially, they tend to be instrument land grab driven, even spatial biology, which we entered more recently, is an example of that. First comes the instrument and then over time, spatial biology probably will be 60% aftermarket and consumables. Our diagnostics business that we acquired, Tejas, is 85% consumables, right? So we used to be 25% aftermarket. Now we're at about 35%. With these acquisitions and then the natural development that in proteomics at first, you sell the timsTOF, the instrument, then you pull through automation and consumables, especially as you then go into the more of the translational and clinical research. People want to have defined solutions and especially when you go into regulated diagnostics then. So over time, Bruker probably will end up at 50-50, and we're moving in that direction. I think that's a good balance. But I'm not at all saying, oh my god, like everyone else, I want to be primarily aftermarket, because I think that does not enable you to innovate the way we've been innovating.

Got it. I want to unpack China a little bit. First of all, it's about sort of 15% of your total revenue. Maybe just to set the stage, Gerald, one for you. Could you talk about your end market mix in China at the moment? How large is academic and government exposure in the region for you?

Yes. On China -- our portfolio in China is about 50% academic government research and relatively modest to 10% in the biopharma space. So the remaining portion of it is industrial research, cleantech and material science-related elements. And we had, at some point, a much larger semiconductor metrology-based business there, but a lot of that's unfortunately not available to us, at least not through the U.S. space. So it's very much tilted towards academic and government research markets, which is actually quite favorable under the proposed stimulus programs under the current plan.

China completely gets it. I mean they have complete genomics -- or Beijing Genomics. They have huge sequencing centers, but their investments in proteomics and in other post-genomic tools, as we call them, they're ahead of the curve in some ways in where the science drives us anywhere. So I think this will be the stimulus package, because we are so strong in academia, I think it will favor academia, it will favor big ticket items. People don't buy $100,000 bench tops when they get a multimillion package and the activity is very significant. So it will be -- we don't know how to size it yet. But we think it will be a meaningful tailwind in 2025 with orders may be coming in, in Q4 and then in the first half of next year. Probably be a tailwind for us for -- on the P&L in '25 and '26, not yet this year. But that's all right. I mean, I think this actually is a nice timing for us. It will also be more spread out than previous stimulus actions, which we're very much focused on a quarter or 2. And as I said, China completely gets the post-genomic era. I think this will heavily favor our products.

Got it. So Frank, just to double-click on that a little bit. Is the right way to think about China for you, a bit of a headwind from continued delays before the money starts to flow down at the province level? Then you get the orders starting in 4Q ramping into the first half of next year. And then after that, what's the lag in your mind before that translates into revenue generation for you -- for us, typically, 2 quarters?

2 quarters. Okay. But the way you described it, yes, it's a little -- I wouldn't call it an air pocket. I think it's, however, demand has been just a little bit anemic recently. And indeed, there have been anecdotal stories of people saying, wow, I'm not going to spend $0.5 million with you now. I'm now getting together with 2 other researchers and we're asking for $5 billion for this new center, whatever it may be, right? So yes, I think we confirm what some other companies have said in that respect as well. So China is a headwind this year, and we think it will turn into a tailwind next year in '26.

And in the context of your portfolio and the end market mix, Gerald, that you just laid out as well, how should we think about long-term growth in China? And what's embedded in your -- the 6% to 8% organic growth target that you've outlined? What's baked in there for the Chinese recovery eventually?

I mean we're pretty positive about the China economic condition overall. I mean, positive in the sense that Frank just outlined, the area in which they really understand is the post-genomic piece, and they also have significant industrial and cleantech activities already underway. So I think a lot of our portfolio is really directed, particularly well to that market. I do think it will likely not be at the growth rates that we saw a decade or so ago, but that doesn't mean it can't be a significant ongoing geographic market for us and for others. I mean just to clarify, we have commercial operations in China. We don't have R&D operations or production facilities in China. So I think, to some extent, we're a little better positioned if it turns out that other things happen from a geopolitical risk perspective to be in a slightly more favorable position than some of our peers. But to answer your question about medium-term outlook, we haven't laid out specifically which geographic piece is driving growth in every -- across that medium-term outlook, but I would say we've factored it in to be pretty balanced, slower than where we were maybe 5, 6 years ago, but certainly not at an unimportant level. It's still a meaningful grower for us.

Zooming out, perhaps, I mean, this industry to us -- the growth of this industry to a significant extent, prior to COVID, that decade was driven by China and China's thirst for innovation and investment and all of that. Over the next 2 years, we think China will be a tailwind for us, because in part of the stimulus, over the next decade, I think China, I assume it will be normalized growth. I don't know that it will outgrow the U.S. or Europe for -- that may be a structural change to our industry. Our industry is changing and the tools that are changing, what gets invested in, biopharma isn't going back to the boom times of 2022. Those aren't -- that's not the normal. We're not snapping back to that. I'm convinced, that's not the case, which is why we're taking so many proactive actions to adjust our portfolio to increase our exposure in biopharma, but of course, in biologics and cell and gene therapy, less affected by IRA and other trends, right? So there will be a new industry fundamentals emerging in the next couple of years, and it's not the old normal. It's not the boom times of '21, '22. And for that, that's why you at least will not say well, you should have been more proactive. I think we are rather proactive and we're doing it very strategically in the way that we think the shape and the contours of this industry will favor in the next decade.

Got it. I want to pick up on what you just mentioned in China that the right kind of exposure and then the mix shift within even the academic budgets towards the newer modalities is providing you a degree of insulation. Does that sort of carryover even to the U.S. and Europe? We get questions around flattish NIH budgets and pressure in horizon funding.

Completely. I mean if I look at academic government budgets, there may be 2 aspects. One that I've mentioned a couple of [indiscernible], but not here yet, right? We've always -- we Bruker have always been strong in academic and government budgets, but 10, 20 years ago, it was the department of chemistry, and Earth and planetary science, and physics and a few others, right, biology, of course. Today, that's still the case, but the much better funding is in academic medical centers. Major cancer centers are a big part of our demand, neurodegeneration research, autoimmunity and yes, all the way to cardiovascular and other areas. Today -- and those are very well funded. So first of all, we're in the -- primarily now in the better funded part of academic research if it's -- second, it's that trend. I mean it is like an ocean. And yes, the ocean goes up and down a little bit. But wow, what does it get allocated to? Is it more genomic sequencing? Is it another SNP project? Is it another WGS project? And those don't stop. But there'll be less funding and thank you they're also becoming much more affordable. I mean some customers said, "Look, look, Frank, I have more money to spend on proteomics because the sequencing chemistries are now relatively inexpensive." And so they can do all their sequencing and they do more, but it's -- there's more budget available for other things. And in Europe, in NIH, in the U.S. and in Japan, China, for sure, the allocation towards multiomics, proteomics, structural technologies, interaction technologies, the greater complexity that we now realize that life and disease has, it's not all in the genome. It's not the blueprint for life. It's maybe 10% of the information that's needed. So the bad news is it's much more complex. The good news for Bruker is it's much more complex and there's a lot more opportunity there. So that fundamental secular shift in how we do disease biology. Biopharma gets it completely. They've already adjusted. NIH and so on is a little slower, but it's coming along as well. And it's very -- that's the most fundamental reason of why we're a fast-growth company today that's outgrowing the markets.

Got it. Switching to biopharma, Frank, you mentioned a couple of times that we're not going back to the 2020, 2021 levels of funding. But biopharma still remains the fastest-growing sort of like end market and tools. And then you also mentioned the right kind of exposure that the neuro modality is. One of the questions that we've been getting is, some of the preclinical CROs have been tucking up a spike in weakness in June, July, largely pointing to IRA and patent cliff concerns. Have you noticed that in terms of your conversations? And secondly, as far as the neuro modalities like cell and gene therapy are concerned, does pipeline reprioritization impact that modality, mainly because pharma companies might want to prioritize larger indications first?

Excellent questions. I wish I had the answer to -- I don't have the answer to all of these questions, but I know they're completely relevant. I agree that our pharma exposure, which has gone from 10% to 15%, things like the old Berkeley Lights, the Beacon instrument is that's going 70%, 80% into pharma, even the NanoString spatial technologies maybe go 20%, 30% into pharma. And we're doing more and more with proteomics and other NMR and other tools. So our pharma exposure is probably going to go towards 20%, maybe eventually 25%, because I agree with you that it's a fundamentally healthy market despite IRA and temporary price control, temporary pressures. I think it will be a more -- it will be a different R&D environment. I think biopharma will not be the standout. I think there's other clinical research at major medical centers. There is cleantech research. There is very advanced metrology and support of AI, I think it will be more balanced to where biopharma is fantastic, but it's not. My god, there's biopharma and then there's the also-rans, everything else. I think it's just -- I think that's part of the '25, '26 picture that where I'm -- where I think there will not be that snapback or the old normal being, the new normal. I'm -- we're investing in it. But I'm also very glad that I'm not 60% dependent on biopharma.

Got it. Fair enough. You talked about your backlog being -- I think it's about 7 months at the moment and 2-year path to getting it back down to 5. I guess one of the questions that we often get is do you have enough of a backlog to bridge you to the other side of the macro headwinds. And on that note, I mean, the book-to-bill number, I think it's 0.95 or so at the moment. Talk to us a little bit about how you see that trending? And second, I mean, a lot of investor focus quarter-to-quarter on that book-to-bill number, as you guys know, right? So how do you think about that number internally? I mean, is it as much of a point of focus for you?

Well, it is and it's more of an annual thing, but do you want to take that?

I'll make a couple of comments, you can follow. So first of all, I mean, I was here a year or so ago, you were kind enough to invite me. And we talked a little bit about that book-to-bill. I think the broader story is for us to look at book-to-bill over an annual period, not on a quarterly basis. And as you've just heard, we have demand swings. We have revenue performance, largely due to the scale of some of the instruments we have. If you have a $10 million instrument that moves from 1 quarter to another, it skews your book-to-bill ratio. So I think, generally speaking, I'm trying to steer investors further towards an annualized look at book-to-bill, and we will report that on an annual basis. So that's the first point. I think the second is, generally speaking, the core business performance has been very healthy, both from a demand perspective and you see the revenue performance already reported. We do -- we're in some choppy waters as we've already just talked about biopharma and some headwinds on China. But fundamentally, the overall demand position is pretty solid. So there may be some ups and downs, but I think generally speaking, we're quite positive about where we are from a book-to-bill perspective.

If I needed backlog for 2 more years of economic -- I don't expect another 2 years of economic downturn. But now I read what you're writing about other companies and what people were saying at Wells Fargo, right? And now it's not so much the snapback talk, but more -- well, if we go from low single-digit declines to a low single-digit market growth in '25 and then maybe to whatever the new market growth in this industry will be in '26, we're completely set up for that. We would be set up for a longer period of weakness, which we actually don't expect. And with our backlog, it's helped us navigate this year very nicely in terms of growth, right, and further organic margin expansion, we could withstand a longer downturn, but that's not what we're expecting. In fact that the market would go. Well, it's -- I don't have specialty leaves either, but I would assume that it will go from low single-digit decline to at least low single-digit growth next year. And remember, we -- rather than 6% to 8%, maybe a good average figure, but we're really looking at outperforming by 200 to 300 bps whatever the market brings organically. On top of that next year because of the acquisitions, we'll still have 2% to 3% M&A growth. That's just the tail of what we've done already that's not signaling new M&A. We're on a bit of an M&A breather and integrating and making profitable or more profitable the acquisitions that we've done with our very successful Bruker management process.

That's actually a perfect segue to my next question. Frank, another life sciences CEO told me earlier this week that companies rarely die of starvation, but they can die from indigestion, right? And on the other hand, I kind of see where you're coming from?

They rarely die of starvation, but they can die from indigestion?

Yes. And so I can see why you pulled the trigger on the assets that you've picked up over the last few months here? They've landed on top of each other more because it's an opportunistic time to pick up those assets, right? And so talk to us about the Bruker management process and how it's playing out with the integration of those assets? And then second, do you need to stick the landing on each of these deals to meet your medium-term outlook? Or is this more of an opportunistic shots on goal approach?

Okay. A number of good questions, right? Yes, I mean, of course, we -- indeed, we did this $1.6 billion of multiple acquisitions, including 3 larger ones and some other bolt-ons, all with assets where we had been in touch with almost all of them for a very long time. And in '21 and even early '22, we also pay attention to ROIC and things like that. So this was just the wrong time to pull the trigger. We would have overpaid, right? I think on the other hand, there was an opportunistic always has this flavor of you're buying stuff that's not strategic. We seized the opportunity of valuation dislocation with some of these assets being -- I mean, ELITech, we bought at a fair market price, right? That was not a bargain. But some of these other things, they were in distressed assets. So you could buy something that was worth billions of dollars previously at very low valuation, very attractive for us as a buyer. And we did that because they were good strategic fits, but some of them are fixer uppers, right? So -- but we have the management process to do that. To your second question, a Bruker management process. As I said, at the high level, over an 8-year period, we had 1,000 bps of margin expansion with that process. It's distributed nicely over the 3 groups. So I really have 3 CEO quality people that are doing this together with us here. So it's not all a centralized activity to where we have -- and we don't have indigestion. We really manage this very nicely. Thank you to that CEO who is -- who thought that we don't have that issue. We have a good process. We have an outstanding team, and we have a very good track record of not only growing things organically, but also in incorporating previously -- I'll give you 2 cases of previously losing money, losing acquisitions that we fixed the right way with cost cutting, but also reinvestment and making them into market leaders. One, we've owned for a while, that's Bruker AXS. I bought that from Siemens when it was a $50 million ,#3 in its market. Today, it's #1 in its market at about $300 million in revenue. It was consistently losing a little bit of money under Siemens. Today, that's one of our medium performers, so about 20% operating margin going into the low 20s. Very good story. My colleague, Mark Munch in the semiconductor metrology, he did the Jordan Valley Semiconductor acquisition. It was a startup with $20 million of revenue and an easy-to-remember number, they lost about 10% operating loss margin. Today, there are $100 million segment -- $100 million revenue segment market leader with operating gross margins well above 60%, gross operating margins well above 30%. Key enabling technology for actually -- this is the metrology you need so that TMSC (sic) [ TSMC ] can make NVIDIA chips. They need a few other tools, not only ours, but that's it wouldn't work without our tools. So a beautiful example of building up something. And the last one is actually is also very indicative of Bruker, because we build up the MALDI Biotyper, clinical microbiology business essentially from scratch over the last 15 years from nothing and from scratch, it's today a greater than $300 million business with greater than 60% gross margin, greater than 30% operating margin. And yes, we've taken that as a platform to add the sample to answer molecular diagnostics business of ELITech, the combined run rate of our infectious disease diagnostics is now $500 million. Yes, that's 60%, 70%, 80% aftermarket consumables, right? Even in the aggregate, if I combine the 2, it's still above 30% operating margin. Of course, I want to grow that. That's the stuff that pulls up our margins, while we push up the margins in big thing NanoString, which is very fixable, taking a lot of cost out and reinvesting in its faster growth. So those are some maybe concrete case studies or example -- when you hear something more like Bruker has a great management process, we do, but there's really very specific evidence plus the overall 8-year evidence track record is terrific.

Fair enough. To be clear, that comment was not about Bruker, that was [indiscernible].

I'm getting too defensive here.

I want to double-click on NanoString. You've guided to, I think, it was $10 million a month in revenue contribution. What's the path to 15% to 20%? I mean, is it is some improvement over [ $10 million ] just a function of being back on the market in Europe? Or what exactly do you need to do to rehabilitate that growth trajectory there? And perhaps more interesting, Frank, from your perspective, Talk to us about the combination of NanoString with CellScape. What could we see you do there from a hardware perspective? Is there a path to integrating those 2 instruments at some point?

Not at the instrument, but at the workflow level and the combined results. Let me back off to the beginning of your question. Yes, we -- if you recall, NanoString before they went into Chapter 11, before they got barred, temporary injunctions in Germany and then in all of the European Union and then they lost the GeoMx case in Delaware, right, one hit after the other. When we acquired them as an asset deal, so we didn't take the corporate infrastructure, the public company infrastructure. A lot of costs had come out already. We modeled it at $10 million run rate per month, and that's a good run rate for this year. The first 2, 3 months came in roughly like that, and that's good for planning, right? When will it grow back towards the previous $170 million? I think it's going to be over 2 years. So us wanting -- it will still be mildly dilutive next year and then near breakeven in '26. That's the plan. And it will take fixing up that you're reinstating putting together that European sales force, but also building a lot of confidence in that team. I mean they had lost everything, right? They were kind of despondent. We have a highly motivated, very aligned, well-trained also in terms of management process and financial discipline and execution team in Seattle, we went from 5 facilities by the end of this year, we'll be in 2 facilities in Seattle and Buffalo, Washington, which is much less expensive and you don't always need to be downtown. We will also reinvest in pushing forward on product development on the CosMx, which competes with Xenium. We have already announced this hero experiment of doing the entire genome. So all 18,000, 19,000 expressed -- doing the gene expression on all these protein genes, all the entire human genome first and that on the discovery side, I think we'll be so far ahead of anybody else that will have a huge advantage. We have somewhat lower throughput and efficiency on the smaller plex translational clinical research. So someone else is ahead on that. We acknowledge that. We intend to catch up with that and leapfrog that actually. But those are things that are on our road map. And these are some new technologies and even chemistries that we bring in. So we're not going to merge the 2 instruments that we're bringing in other barcoding and chemistry schemes, other approaches in software that we will -- that will also technologically strengthen the NanoString product line. One more aspect, if I may. We had -- without NanoString, we had budgeted tens of millions of OpEx per year to build a really big spatial biology channel to compete with Akoya, to compete with 10x and NanoString and all of those folks. The cost avoidance at Bruker by being able to have this right off the bat and use that NanoString channel, they go into all the same labs, the same salespeople and even service and field applications people and so on, can all be cross-trained. So I will have one spatial biology channel, courtesy of that NanoString much larger business with a much larger installed base, right? And I can plug in 2 things. First of all, the spatial proteomic CellScape that you mentioned. There, we are #3, and we want to catch up with Bio-Techne and Akoya, right? And they're doing a good job. It's a nice growing area in spatial proteomics. And then if you recall, you probably don't recall, we acquired -- we in-licensed from Harvard Medical School, 3.5 years ago, Acuity Spatial Genomics. And I really mean spatial genomics in the DNA structure, the chromatin structure, the chromosomes, not transcriptomics, everybody can do that. That's much, much harder, and this doesn't exist today. So therefore, you haven't heard about it. We're launching that in early '25 probably around AGBT. That, again, does not need a separate channel, but it can all go into that channel, which is why strategically even more than was obvious from the outside for us, Bruker, as a new owner, this is such a good asset to be with Bruker because it will be our spatial biology channel and platform with covering transcriptomics, NanoString, proteomics and soon also this truly differentiated spatial genomics, which nobody else does yet.

Got it. Fair enough. Just quickly on the proteomic landscape and the evolution there. You've launched the Ultra 2 timsTOF instrument at ASMS earlier this year. And there's been some sort of movement in the space, Thermo bought Olink. So as you think about the broader landscape, not just on the mass spec side, but also on the targeted front, can you just talk about your portfolio positioning there? And I think you've done PreOmics and you've got the investment in Biognosys?

Exactly. So the mass spec-based proteomics with PreOmics, consumables and automation, TRO and the best software for mass spec-based proteomics from Biognosys. We have a beautiful coverage. Thermo has done a good job with that Astral instrument that does a very nice job. We have advantages in some areas. So that's a 2-horse race that for sure in a very fast-growing area. So that's good. The slightly broader perspective of -- initially, the mass spec-based proteomics couldn't really participate very much in the largest part -- growing part of proteomics, which is plasma proteomics or large-scale epidemiologic studies. So those -- there you essentially went to Olink or you went to SomaLogic which is part of Standard Biotools now. But their mass spec-based has the huge advantage that it has 99% accuracy, not 85%, not 95%, 99% is essential. And we now have the throughput and robustness and probably a factor of 5 in better economics. I think there will be a big shift in that favors mass spec-based proteomics in this liquid biopsy biomarker or large-scale U.K. Biobank or whatever it may be, epidemiological studies where you need more than check-the-box proteomics, but you don't know which are right and which are wrong. You need the 99% specificity at the better economics and now with the throughput and robustness. Having said that, these other areas have a right to exist. And I mean there's companies like that I think are much more sensitive than Olink, like an Alamar, we're a minority investor. So we think in some of our CRO offerings, we're combining the tools. For Alzheimer's research, we think some of the mid-plex panels don't have to be on mass spec with ultimate sensitivity. So we're taking a pretty broad holistic approach to proteomics and we're not just a purveyor of mass specs or timsTOF.

Perfect. We're out of time, but I'd be remiss if I let you get off the stage without asking you -- you're in the unenviable position of having a point estimate for '25 EPS out there. And it's a target. I get it. It's not a guide.

It's a calculation.

It's a calculation, but it did make it on a PowerPoint slide, I suppose, in your deck.

That's correct.

As you think about that number, how should we think about the degree of downside risk from the NanoString operating loss? Or do you have enough levers between the ELITech accretion, cost-outs at NanoString and the base business benefiting from maybe not a full rebound, but continued improvement in biopharma in China to essentially have enough of an offset in the portfolio at the bottom line?

Yes. No, I mean, we're very comfortable with our multiple -- what May '17, we gave our medium-term outlook for 2017. And yes, they were a PowerPoint with interpolation right, completely. We're very optimistic that we'll have very fast EPS growth in the next 3 years, which is implied after very fast revenue growth and more recently also inorganic. And that does bake in some China tailwinds, not something extraordinary, but we think it will turn from a headwind into a small tailwind, at least again, that does bake in some biopharma recovery. We don't have it now by midyear, but we think we'll have some of it next year, even if it doesn't go back to historical boom levels. So with that, I'm really quite comfortable that there is enough takes, right, that we are on a good track this year, next year, over 3 years and longer term.

Perfect. This is great. Thank you so much, guys, for joining me. I appreciate it very much.

Thank you very much.

Thank you all.