Cibus, Inc. (CBUS) Earnings Call Transcript & Summary

Thanks so much, and welcome everyone on this afternoon. We appreciate your time in joining the Cibus call and webcast covering our second quarter 2026 financial results along with a business update. Joining me on today's call are Craig Wichner, who serves as our chief executive officer, and Peter Beetham, Cibus Founder, President and Chief Operating Officer. Gregory Gocal, our Chief Scientific Officer, is also on hand to take part in the Q&A segment. Before we get going, I want to note that anything stated during this call and on our webcast — including remarks about future financial results, upcoming operational goals, and industry prospects — counts as forward looking and could be affected by various risks and uncertainties that might cause actual results to differ materially from what's described here. For a list of associated risks, please refer to Cibus' SEC filings. This conference call is being webcast. The webcast link, together with our press release and corporate presentation, can be found on the Investor Relations section of cibus.com to help you in your analysis of our business. With that said, I'll now hand the call over to Craig.

Thank you, Cornelis, and hello everyone on the line this afternoon. This is the first time I'm speaking on an earnings call as CEO. Let me start by sharing the reasons I took this position. Across a span of 25 years, Cibus has built something truly distinctive. My decision to join the Cibus board came about because the technology and the people are both among the best anywhere. And the reason I accepted the CEO role is that I have strong confidence in our ability to generate revenue at scale. That mission drives me. My studies in biochemistry and molecular biology took place at UC San Diego — the very city where our laboratories are located today — and I've devoted more than 30 years to founding technology companies and managing investments. During 17 of those years, I oversaw organic and regenerative farmland for investors, and there we achieved stronger returns on assets by deploying technology and smarter farming methods. Today we hold more than $400 million of pristine cropland across Washington state, California, and Oregon. I understand directly the pressures growers face. Fertilizer now costs more than before, and every grower I know wants a way to extract more from whatever they can afford. Those are the people Cibus serves. A grower makes do with whatever is right in front of them. Equipment, water, chemistry, improved practices in the field. At the top of that list sits the seed. This is the initial choice of the season, and it's one you cannot reverse; it also sets the upper limit that all subsequent efforts are measured against. When it comes to corn and soybeans, advancements in seed technology have been remarkable. For nearly all other crops, movement has been far more sluggish, because breeding takes many years and outcomes are hard to predict. Every crop that exists comes from plant breeding, and at Cibus, we handle that part rapidly and with precision. Cibus is a tech firm, and we hold a platform shielded by IP that makes exact seed enhancements possible in a small portion of the time traditional breeding demands. Think of the genome as data. Now think of our platform as the mechanism through which we turn that data into superior outcomes for farmers. Quickly and accurately. Partners are willing to pay for that kind of speed because it lowers what they spend on development and lets them launch products sooner. An iterative, scalable platform is what we've built. Whatever work we do, along with the tools and expertise behind it, carries over from one program to the next. Once a trade has been created in one crop, we don't start over from scratch the next time around. Instead, we build on knowledge we already have, which means every program ends up costing less than the one before it. That advantage also accumulates for our partners, and within ten years it could put them one or two generations ahead of competitors. The direction we're headed is defined by this capability. Since the platform scales, it lets us stay nimble while evaluating market and customer needs; that's the key idea I want to leave with you today. Because that's how I want you to view Cibus from here on. One platform, one set of foundational capabilities, and it produces value in 3 distinct ways across the company. First comes the revenue we bring in right now, through platform programs in which we perform edits for partners and take a share of the value that gets created. Our sustainable ingredients effort is the most obvious illustration, and though it remains in the scaling phase, it has driven a 35% revenue increase year to date. Next, we have the trait royalty model, and that's the path we're taking with Rice. In that case, we earn a fee for every acre where our traits are planted; growth kicks in as we roll out commercially, beginning in Latin America, and it builds up as adoption increases over the years. The third piece involves strengthening those same relationships over time. A partner gets access to a pipeline of traits from us — improved yields, resistance to disease, higher-quality crops for their own buyers — not just a single tweak in one crop, but a continuous flow of advancements across their entire range. Once those relationships deepen, we end up functioning as an arm of their breeding efforts, and the confidence built across the first 2 tiers is precisely what makes that possible for us; the way we frame how we approach and run the business gives us optionality and lets us align the appropriate model with each market opportunity. When it comes to row crops, a space controlled by a handful of big seed players, the sensible path is to hand our traits to that sector under license and collect royalties on each acre put in the ground. We turn into a technology partner that speeds up their pipeline. With partners positioned to engage us directly, we sign contracts for platform access. Once those partnerships evolve and collaborators start sharing their development plans with Cibus, the relationship gets stronger. That's the benefit our platform's scalability delivers — the ability to turn one project into a wider range of possibilities, potentially spanning a whole crop or ingredient approach, done within set timelines, reliably, and with efficient use of resources. To repeat, I came onto the Cibus board 9 months back, so I already had familiarity with the company. During these last 2 months serving as CEO, my belief has only deepened. I've been spending the bulk of my time alongside our teams, and what I've discovered are capabilities and initiatives that have accumulated across 25 years and a wide range of crops, a good deal of which sits nearer to product than most folks would imagine. Peter is going to walk you through where things currently stand. I'm looking at each program, each expense, and each opportunity through one straightforward filter. What generates revenue in the near term, what makes the balance sheet stronger? And what releases the value we've already created. This company will be operated with discipline around capital, We're putting priority on how resources get allocated and boosting what we invest in AI so that our team becomes more productive. Ahead of passing the mic, I'd like to express my appreciation to Peter — both for the warm welcome onto this team and for the strength he keeps bringing to it in his roles as president and chief operating officer. Since he helped found this company, Peter has steered us through several stretches of growth. Everything I've laid out as our strategy builds directly on foundations that he and many other colleagues established. With that, I'll turn it over to Peter, who can walk us through our commercial position. Peter?

Thank you, Craig, and good afternoon to all of you as well. Having Craig come aboard to steer Cibus as our new CEO is wonderful. We consider ourselves extremely lucky to have someone who is a leader in the farming sector, a scientist, and a financier guiding Cibus toward its next stage. What I would like to do with my time is expand upon Craig's remarks by demonstrating how his vision aligns with our short-term commercial priorities; this quarter and how those strategies can open up the incredible possibilities that lie before us as we strive to strengthen our industry partnerships. If I boil this quarter down to a single concept, it is that the discussions we mentioned earlier in the year are now turning into commercial actions. Seed companies are approaching us not seeking one edit in one crop. Rather, they want a continuing partnership in which we provide customers' canola and winter oilseed rape lines with 6 returns. Our herbicide tolerance traits have been moved into elite rice germplasm; we have provided 3 improved rice lines to a customer in the United States. And we have edited rice material and sent it back to Interoc, our first Latin American customer. Each 1 of these constitutes the building blocks of value, and our aim is to verify the 12-month turnaround of edits across all crops. That is what we have accomplished in canola; so allow me to go further into our 2 priority near-term programs. Sustainable ingredients and rice; in Craig's terminology, these represent the first 2 tiers. Sustainable ingredients is producing platform program revenue at present. And rice is a trait royalty business that expands once our customer launches in the field. Beginning with sustainable ingredients, which keeps generating R&D revenue, this program encompasses gene-engineered yeast to create oils that consumer product companies require. For example, consider fragrance ingredients, the molecules responsible for giving a product its scent. These are produced in a fermenter, instead of being pumped from petroleum or extracted from harvested plants. This program is bringing in revenue, and it serves as a proof point for the platform model. We obtained our first customer payment from this program during the fourth quarter of 2025. It has now entered a commercial ramp up phase alongside our consumer product partner. Revenue increases when 4 things occur sequentially. First, our partner confirms the ingredient works in their product. Second, we manufacture it at full commercial scale. Third, we settle on supply terms and pricing. And fourth, our partner submits commercial production orders. We have moved beyond the first, We still anticipate additional scale up orders of our initial biofragrances in the second half of 2026. We are also creating further fragrance ingredients with a similar edited yeast and the same process that yielded the first biofragrances. Each 1 begins from work already completed, so it gets to the partner more quickly than the previous product did. The potential here is significant. Once fully commercialized, we think our biofragrance partnership could amount to as much as a $20 to $40 million yearly revenue opportunity for Cibus. Equally significant, that revenue acts as a short-term bridge that grows as the rice royalty we anticipate begins to scale. Plus, it highlights a point I believe gets too little credit: the very same fundamental technology that confers herbicide tolerance in rice is generating commercial worth within the consumer products sector. One platform, several markets. We're also continuing to push forward our lauric oils initiative in soybean, backed by our consumer packaged goods collaborator. That's a second partner-funded effort within sustainable ingredients, operating on the identical soybean platform we're developing for additional traits. Moving to rice, Latin America serves as the main focus of our near-term rice work; it accounts for the majority of the approximately $200 million yearly addressable royalty chance throughout The Americas. Across a combined 5 to 7 million peak addressable acres. As we've mentioned before, we have 7 rice seed company clients spanning Latin America and The United States. And we keep moving forward with talks involving further C companies in Latin America and India. We're revising our guidance on the timing for the first commercial launch of rice in Latin America, shifting from late 2027 to 2020. With our client Federarroz progressing as planned and our client Interoc strategically concentrating on hybrid varieties, with the possibility of a limited launch in 2028 too. Throughout the quarter, we pushed development ahead on both of our rice herbicide tolerance traits, encompassing field trials of a better first generation trait and efforts to pinpoint the particular genetic changes behind the dramatic boost in herbicide tolerance and seed fertility within that trait. Crucially, testing of the traits. We moved to Interoc rice seed in May, is in progress; during August, we broadened our framework with Interoc from 2 rice traits to 5 That alters the character of the relationship as we keep working toward a definitive commercial agreement. Rather than licensing 1 trait into a customer's variety, we're aiming to become a trait pipeline driving their varieties. That's the model we plan to establish with seed companies. And that's why we state speed is our product. Within The United States, our launch is tied to our partner Albaugh's herbicide registration timeline, and our present planning aims at a 2029 launch. The effort toward this launch stays on track. Past our 2 priority programs, the identical platform is sparking interest throughout a wider array of crops and traits. Cibus has shown regeneration from single cells toward enabling crop platforms in 8 crops. Rice, canola, wheat, flax, peanut, potato, sugar beet, and cassava, along with additional crop platforms, such as soybean, are under development; this is where Craig's third tier starts to come together. Taking this work and the operational platforms we've established, to current partnerships to figure out where we can speed up their innovations; these discussions are progressing partly due to a harmonizing regulatory environment, which has brought the entire industry back into focus. Nutrient use efficiency is our program alongside the John Innes Centre, a top plant science institute in The United Kingdom. Our efforts center on the way a plant's roots absorb nutrients from the soil around them. And rather than just nitrogen, it addresses the entire fertilizer package. We anticipate delivering edited canola material to them during Q3 of this year. And to strengthen our single trait multi crop strategy, this trait could potentially be used in rice, wheat, and canola. In The United Kingdom we have 2 canola programs; the 1st involves resistance to light leaf spot, a fungal disease that reduces canola yields throughout Europe, and that program receives funding from a UK government research initiative administered by DEFRA, the British Agricultural Department. The 2nd is likewise a yield enhancer aimed at Pod Shatter Reduction. That stops seed pods from breaking open and releasing their seed prior to harvest. After 2 years of promising field trials in England, using our customers' own varieties, Pod Shatter Reduction is advancing to broader trialing in that country. It will be sown under Britain's new precision breeding regulations. These regulations, applicable in England, treat gene edited crops identically to a conventional 1. 1 additional outcome from our canola efforts.

The tolerance level we'd anticipate from a novel weed management solution is being matched in this year's trials for our second generation herbicide tolerance trait, which has moved forward. Farmers get valuable choices from canola weed control solutions targeting hard-to-manage weeds, and those choices can cut down the overall herbicide package required, lowering both expense and chemical application. What this means is that across multiple crops and traits of growing complexity, our platform is delivering; and each one of these programs can be partnered. The optionality Craig talked about is what they collectively amount to. Last, at a time when it counts, the regulatory landscape keeps favoring us; the European Union completed new rules in June that generally place most crops improved without foreign DNA addition on the same footing as conventionally bred crops. Instead of being treated as GMOs; those rules took effect in July, and a 2-year implementation period now begins. For our industry this marks a significant moment, and the acknowledgment arrives from 1 of the biggest and strictest agricultural markets globally. Canola and oilseed rape efforts such as disease resistance and our Pod Shatter Reduction are anticipated to meet the criteria for that same conventional breeding treatment. Pod shatter reduction in winter oilseed rape is the first submission we have planned under the new framework. In Latin America, Ecuador and Peru have each affirmed that our first and second generation herbicide tolerant rice traits match those produced via conventional breeding. On a separate note, the United States Food and Drug Administration finished its assessment of our altered lignin alfalfa trait and sent a letter saying it has no further questions. USDA APHIS in The United States has concluded that our traits are not regulated articles. Under its biotechnology regulations. Now 3 continents are covered by those decisions, and the launch timelines I described today rest on them. So with that, I'll turn it over to Cornelis for the financial review. Cornelis?

Thanks, Peter. Turning to our second-quarter numbers: cash and cash equivalents stood at $20.4 million as of June 30, 2026. One encouraging sign was that cash burn for the quarter dropped roughly 19% versus Q1, and 31% against the prior-year period. When we factor in the cost cuts already made — and leave aside any financing transactions Cibus might enter into from time to time — we believe our current cash and cash equivalents will support planned operating expenses and capital expenditure needs into early in the first quarter of 2027. Now to Q2 operating results: quarterly revenue came in at $1 million, up against $900 thousand in the comparable period a year earlier. Over the past six months, revenue from our collaboration agreements with the sustainable ingredients program reached $2.7 million, rising from $2 million — a 35% increase. At this stage those figures may seem modest, but what counts is the direction. R&D expenses were $8.5 million, lower than the $12.2 million recorded in last year's comparable period. That $3.7 million decrease stems mostly from our cost reduction initiatives. SG&A was $5.4 million, compared with $6.6 million a year earlier. The $1.2 million drop mainly reflects those same cost-cutting measures. All told, R&D and SG&A operating expenses came down by almost $5 million versus the prior year, and it's worth noting as well what shows up below the operating lines. Interest expense on non-cash royalty liabilities owed to related parties was $9.5 million for the quarter, against $8.7 million in the same period last year. That amount reflects interest accruing on the royalty liability balance. Among everything widening the gap between our operating loss and our net loss, this item is the largest. The savings we're delivering stem directly from the cost discipline now central to how this company is run. As Craig said earlier, the team is conducting a thorough review of both our cost structure and our capital allocation, and we plan to share more detail on our next call. On non-operating income, net, we recorded $0.2 million of income. In the comparable period last year, that line reflected a nominal expense. The gain is driven by increased partner funding for Cibus's completed work, together with a fair value adjustment on the company's liability classified common warrants. Net loss for the quarter was $22.1 million, versus $26.6 million in the same period a year ago. Net loss per share of Class A common stock came to $0.29, compared with $0.61 a year ago. The cost reductions I described were the primary driver of that $0.32 improvement. Separately, $6 million is expected to be received under the partnership arrangement. In addition to an increase in weighted average shares outstanding versus a year ago, when it comes to how we use net cash, our target now is a net cash usage run rate of about $35 million as we exit 2026, and that shows continued cost discipline even while we invest more in growth efforts such as technology and people. Now I want to give a little more color on how we expect the right royalty streams to take shape. Since payments tie to how many acres get planted, the timing of when that revenue shows up depends on when commercial launch actually starts. As soon as our Latin American partners begin selling rice containing the trait, we expect those royalty payments to start in 2028 and then build through 2029 as additional acres and additional customers join. To put it in perspective, at peak volumes across all the rice acreage we might serve, we've discussed an annual royalty number above $200 million; getting from those initial planted acres in 2028 to that point requires multiple years, and we'll continue reporting our position every quarter. The larger picture is straightforward. Strict cost management is evident in our results. Near-term revenue is building within the first 2 tiers Craig described. With the platform programs already underway and what the rice royalty business might become as it expands over the coming several years — including the potential to add roughly $6 million — everything we're doing aligns with Craig's objective of strengthening our financial foundation through a sound strategy. With that, I'll turn it back to Craig for his closing remarks.

Appreciate that, Cornelis. Cibus stands out as a technology few can match, shielded by over 500 patents and patent applications, and proven out via rigorous regulatory routes that offer an obvious route to worth spanning the 3 tiers I laid out. 8 platform programs, a royalty operation that grows alongside Rice, and partnerships that keep getting deeper. Executing on that structure is what we're here to do, and that's precisely where this team's attention sits. The reason I accepted this role is my conviction that this platform can drive revenue at scale. Nothing has shifted on that front. So, operator, let's open it up for some questions.

Hey there. I appreciate you fielding our questions, and congratulations on what you achieved during this quarter. I wanted to ask whether you might elaborate a bit on the strategy of turning into, in a sense, a trait machine aimed at particular seed businesses, instead of granting licenses for your traits to large agricultural conglomerates. What do the economics look like, and what kind of moat do you hold in that area?

Wonderful. Matthew. I really appreciate you being with us. I appreciate your inquiry. Speaking is Craig Wichner. Your inquiry concerned the trait machine — advancing the trait machine. On a narrower footing instead of simply spanning the whole enterprise. Without question, we keep delivering our technology along with our solutions throughout the industry. What we bring in addition is the capacity to genuinely deliver a competitive edge for particular essential partners within particular geographies on a crop-by-crop basis; thus, a partner such as Interoc, to illustrate, in rice, we possess a solid, extensive platform on the technology side; we have multiple partners active in the market and within the crop. And the thing Interoc feels enthusiasm about is the chance to possess a pipeline of traits. Moving into rice. In order to truly hand them a robust competitive edge. For that. That permits us to genuinely concentrate our work and deliver substantial value to particular partners; our conviction is that this will simultaneously speed up the rollout and the partnerships involving our company, and also widen the market opportunity too. Truly establishing a tighter connection with the essential companies.

Excellent. Thank you, Craig. If I may, just one additional question. How common is hybrid rice throughout Latin America? I realize this represents a far more dependable stream of repeat business. In the regions you intend to move into during 2028, what number of acres do you include in your projections?

Appreciate it, Matthew; Peter here. I'll address that one, since I believe, as you're aware, 26 has proven to be a genuinely thrilling year for us, watching clethodim tolerance rice perform in the field once more, with our partners having the opportunity to observe it across various geographies. The enthusiasm surrounding that trait stems from how effectively it performs. That's been wonderful to witness. I believe they're watching, and considering the Latin American marketplace, which has mostly consisted of inbred or conventional varieties, it is shifting, and they'd be eager to shift at an even quicker pace toward hybrid seed production; so, as you know, combine that with broadening what we're doing to strengthen our relationships under Craig's vision; involving Interoc and others, plus the capacity to essentially examine the trait and say, wow. That's fantastic. We wish to place this on the greatest possible number of acres and achieve strong market penetration. So, as you know, at present, looking at key crops globally, every one of them is moving toward hybrids. So, as you know, corn has corn has shown the path. Wheat is arriving at that point now. Canola has consistently occupied that space. And currently we're observing rice, as you know, worldwide experiencing that same effect; so, as you know, when we project acres, we anticipate expanding acreage within that 5 to 7 million acres range moving ahead as hybrids take hold in that marketplace. So, as you know, we're collaborating with additional partners such as Federarroz, who lean more toward the inbred side or the variety side. Therefore, it will significantly propel our model forward.

Excellent. Thanks, Peter. And I appreciate you all answering my questions.

Appreciate it, Matthew.

Hi there. Afternoon to everyone. I appreciate you letting me ask a question. Craig, Peter, and Cornelis — congratulations on how far things have come. And particularly, well done on the opening in the EU. From what I recall in your prepared remarks, you referenced an implementation period of 2 years. My question is whether you've got staff on the ground who can shape that process, or what's the approach to handling it so you'll be ready once the moment arrives?

I'll handle that one. Peter here. It's a really significant question. As you're aware, our company has tracked EU legislation for many years, and done so very closely. Several industry organizations, such as Euroseeds and the American Seed Trade Association, have served, you know, as strong advocacy voices for that legislation. And I can share that already, you know, following the vote we've already had quite a few engagements regarding the discussion. Items concerning the implementation. So, you know, I've already traveled to Brussels and delivered presentations. We've received invitations to several other conferences over the coming months. And this is assisting DG SANTE, the body that will oversee the administration within the commission, And apologies for the interruption, this is the operator.

We're trying to figure out the point where we got cut off. Right. Could you assist us in grasping where the disconnect happened?

Yes. Samir here. My sense is you were walking through your advancements across European nations and the way you're situated in those markets.