Dyadic International, Inc. (DYAI) Q3 FY2025 Earnings Call Transcript & Summary

Good evening, and welcome to Dyadic International's Q3 2025 Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded today, November 12, 2025. I would now like to turn the call over to Ms. Ping Rawson, Dyadic's Chief Financial Officer. Please go ahead.

Thank you. Good evening, and welcome, everyone, to Dyadic's Q3 2025 Conference Call. I hope you have had the opportunity to review Dyadic's press releases announcing financial results for the quarter ended September 30, 2025. You may access our release and Form 10-Q under the Investors section of the company's website at dyadic.com. On today's call, our President and Chief Operating Officer, Joe Hazelton, will give a review of our Q3 2025 business and corporate highlights and provide a commentary on the strategic direction of the business. Our CEO, Mark Emalfarb, will provide an update on our biopharmaceutical programs, and I will follow with a review of our financial results in more detail, after which we'll hold a brief question-and-answer session. At this time, I would like to inform you that certain commentary made in this conference call may be considered forward-looking statements, which involves risks and uncertainties and other factors that could cause Dyadic's actual results, performance, scientific or otherwise, or achievements to be materially different from those expressed or implied by these forward-looking statements. Dyadic expressly disclaims any duty to provide updates to its forward-looking statements, whether because of new information, future events or otherwise. Participants are directed to the risk factors set forth in Dyadic's reports filed with the SEC. It is now my pleasure to pass the call to our President and COO, Joe Hazelton. Joe?

Thanks, Ping, and thank you all for joining today. The third quarter was another pivotal quarter for Dyadic as we continued our transformation from a platform-centric R&D organization into a commercially focused biotechnology company with a growing portfolio of high-value products. At the start of the fourth quarter, we saw our first commercial bulk sale of a Dyadic-produced protein, marking the beginning of a new chapter in our company's evolution. We expect momentum to build with additional product opportunities emerging in 2025 and accelerating in 2026 as we scale our portfolio and expand our global market reach. We've now rebranded as Dyadic Applied BioSolutions, launched a redesigned corporate website to enhance commercial engagement, and strengthen our technology foundation with the addition of CRISPR/Cas9 gene editing capabilities through our license with ERS Genomics. This license allows us to accelerate strain optimization, improve productivity, and further increase yields and consistency across our proprietary C1 and Dapibus platforms, directly supporting commercialization and profitability. At this stage, Dyadic is no longer just a story about potential. It's a story about execution, commercial traction, and growing product revenue. As we move from transformation to execution, our progress in Life Sciences in the Life Sciences segment highlights how Dyadic is now operating as a product company. We are manufacturing and supplying lab-grade material for multiple recombinant proteins, focusing our efforts on near-term product revenue from markets where the need for animal-free, high-performance materials is rapidly expanding. The cell culture media market represents one of the most dynamic growth areas in biotechnology, supporting biologic manufacturing, cell and gene therapy, and cultivated meat. These markets require consistent animal-free proteins that enable scalability and regulatory confidence while balancing costs, and our protein production platforms deliver on those needs. The recombinant human albumin program, in partnership with Proliant Health and Biologicals, continues to advance toward commercial launch in early 2026. Albumin is a cornerstone protein used across diagnostics, research, and biomanufacturing for stabilizing and transporting biomolecules, and transitioning to recombinant production offers significant advantages in purity, safety, and supply chain reliability. We remain fully aligned with Proliiant as they prepare for market entry. To date, Dyadic has received a total of $1.5 million in milestone payments from Proliant, including a third payment of $500,000 received in October, and we expect to share in the profits as the albumin products enter the market. This collaboration exemplifies how our platforms enable partners to deliver high-value animal-free proteins at commercial scale. In October, we achieved an important milestone with the first bulk purchase order for a Dyadic-produced protein. Our recombinant bovine fibroblast growth factor, or FGF, is now being sold into the cultured meat market, demonstrating our ability to deliver commercial-grade material at scale and validating the market readiness of our technology. Looking ahead, in addition to growth factors, our top product priorities are animal-free transferring and DNase1, which are now in active manufacturing and sampling to prepare for commercial launch. Transferrin is a key functional protein in serum-free cell culture media responsible for delivering iron to support healthy cell growth and metabolism. Dyadic is producing both bovine and human recombinant transferrin to serve distinct market segments. Bovine transferrin is designed for cultivated meat and research markets where cost efficiency and scalability are key, while human transferrin is targeted for biopharmaceutical and cell and gene therapy applications, which demand higher specification and regulatory-grade consistency. Together, these 2 products position Dyadic to compete effectively across complementary ends of the market. Our FGF program continues to advance beyond the cultured meat segment as we target cell and gene therapy manufacturers and suppliers. FGFs are essential growth factors in cell culture formulations, driving cell proliferation and differentiation. We're now expanding sampling and validation activities with additional customers, and interest continues to build as companies look for reliable animal-free sources. In molecular biology reagents, our RNA-free DNase1 has completed production validation and entered sampling while we work to secure purchase orders. DNase1 is a critical enzyme used in gene therapy, molecular diagnostics, and biopharmaceutical manufacturing to remove unwanted DNA without compromising RNA or protein integrity. Dyadic's ability to supply DNase1 in a high-purity animal-free form directly supports the industry's move toward cleaner, more consistent inputs without increased costs. These products form a high-margin recurring revenue foundation serving critical and fast-growing life science applications. We're also advancing the development of T7 RNA polymerase and RNase inhibitor products to expand Dyadic's position in the DNA and RNA enzyme market. To further expand our global commercial reach, we recently partnered with Intralink, a leading Asia Pacific business development firm, to accelerate market penetration in Japan and South Korea, 2 of the world's fastest-growing and most advanced markets for cell culture media and molecular biology reagents. Being a lean U.S.-based organization, we look to leverage local expertise and established commercial networks to effectively reach these important markets without the need for significant internal infrastructure or capital investment. Intralink provides Dyadic with on-the-ground commercial resources and regional experience that allow us to engage manufacturers, distributors and potential partners more directly and efficiently. Through this partnership, we are actively introducing our products, such as transferrin DNase1 and growth factors, as well as our platform technologies to new customers in the Asian region, expanding Dyadic's footprint across key global manufacturing hubs in a cost-effective manner. Building on our momentum in life sciences, Dyadic is also advancing its commercialization efforts in the Food nutrition segment, another large, fast-growing market where our technology is enabling the transition to animal-free sustainable protein production. The food and nutrition market is undergoing a structural transformation as global food producers shift towards sustainable, functional, and animal-free proteins. This transition is driven by consumer preference, regulatory trends, and supply chain sustainability pressures, and it presents Dyadic with a major opportunity to apply its Dapibus platform to supply recombinant proteins and enzymes at scale. The animal-free dairy protein market alone is expected to exceed $20 billion by 2035, led by growing demand for precision fermented proteins in infant formula, medical nutrition, and wellness applications. These markets require consistent high-purity proteins that replicate the nutritional and functional properties of traditional dairy ingredients, areas where we believe that Dapibus may provide a competitive edge. Our recombinant alpha-lactalbumin program advanced meaningfully this quarter. We've entered into a term sheet with a non-animal dairy development partner focused on the infant nutrition market, and we anticipate additional agreements for our alpha-lactalbumin program in 2025. The protein has demonstrated strong performance in product testing and formulation trials, with sampling for research and nutritional applications expected by late 2025 or early 2026. Also in the third quarter, our human lactoferrin program continues to progress with a stable production strain developed and yield optimization underway. Lactoferrin is valued for its antimicrobial and immune-supporting properties and commands premium pricing in both nutritional and wellness markets. We expect sampling for research use in early 2026. In non-animal dairy enzymes, we received an additional $250,000 milestone payment for enzymes in the third quarter, bringing total license and milestone revenue from this partnership to $1.275 million to date. Scale-up for the first enzyme remains on track for commercial launch in late '25 or early 2026, with a second enzyme candidate advancing towards commercialization under the existing license. Importantly, Dyadic is eligible to receive future royalty payments on commercialized products, creating a recurring revenue opportunity and further validating the commercial value of our technology and partnership model. As we expand our presence in food nutrition, we're also applying our technology to industrial biotechnology, where Dyadic's enzyme expertise is addressing global demand for more sustainable, efficient, and bio-based manufacturing solutions. Dyadic's Bioindustrial segment continues to demonstrate the scalability, flexibility, and cross-sector relevance of our enzyme technology. Using our Dapibus platform, we're delivering enzyme solutions that replace petrochemical or animal-derived inputs and improve process efficiency across industrial and emerging bio-based markets. Our collaboration with Fermbox Bio on an enzyme cocktail that converts agricultural residues into fermentable sugars continues to advance and deliver results. Fermbox is a strategic partner for Dyadic with robust manufacturing capabilities across multiple quality grades, which allows us to serve a broader range of industrial and bio-based customers. Initial commercial deliveries have been completed, and sampling is expanding with additional customers in biomass processing, biofuels, and pulp and paper markets. Under this partnership, Dyadic participates in a 50-50 profit share on sales, creating a scalable and recurring revenue model as the adoption and portfolio grow, and we expect to begin seeing revenues in the first half of 2026. Our cellulosic enzyme technology is also being evaluated in regenerative medicine and tissue engineering through collaborations with pharmaceutical and medical device companies. These efforts demonstrate how Dyadic enzymes can contribute to the development of biomaterials for the rapidly growing market of tissue repair and regeneration, further underscoring the versatility and commercial reach of our technology beyond traditional industrial applications. In parallel with our commercial initiatives, we continue to advance a select group of partner-funded biopharmaceutical collaborations that extend the reach of our technology into vaccines and antibody production, providing valuable validation and nondilutive funding while we stay focused on near-term product revenue. I'll now turn the call over to our CEO, Mark Emalfarb, to provide an update on our progress of these partner-funded collaborations. Mark?

Thanks, Joe. Our biopharmaceutical programs are accelerating and delivering meaningful advancements in vaccine and therapeutic protein development for both animal and human health through collaborations supported by the Gates Foundation, the Coalition for Epidemic Preparedness and Innovation, CEPI, and our strategic partnership with Dr. Rino Rappuoli and the Fondazione Biotecnopolo di Siena, FBS, as part of the EUR 170 million EU vaccine hub. We're continuing to validate the power of our C1 protein production platform through nondilutive funding. These efforts are generating strong data that demonstrate C1's ability to rapidly, efficiently, and affordably manufacture high-quality biologics, including vaccines, monoclonal antibodies, and other complex proteins with exceptional productivity and scalability. Our Gates Foundation program focused on developing low-cost monoclonal antibodies for malaria and RSV have achieved key milestones in both productivity and in initial biological characterization when compared with the same antibody produced using traditional mammalian chill production methods. To date, we've received $2.3 million of $3 million grant. Under our CEPI Fondazione Biotecnopolo di Siena collaboration, Dyadic is eligible for up to an additional $2.4 million in funding to support antigen design, cell line development, and cGMP manufacturing scale-up. This project has already begun to generate encouraging data, including the successful development of another C1-produced H5 influenza antigen by FBS. Initial results show that the Dyadic's H5 antigen reacts as expected with human monoclonal antibodies. In collaboration with FBS, we're preparing to provide H5 antigen samples for preclinical evaluation with the potential to advance into a funded Phase I trial. Other CEPI-supported programs, including the UVax Bio MERS vaccine and the AdaptVac consortium for broad-spectrum fibovirus and vaccines, are expected to further reinforce C1's ability to deliver rapid, scalable, and cost-effective production solutions. Our collaboration with the process development unit at the NIAID NIH continues to generate encouraging data that not only supports vaccine development, but also enhances the productivity and consistency of our C1 platform. The insights and process improvements gained from this and other funded programs strengthen C1's broader capabilities, and these can be applied across both our biopharmaceutical and Dapibus non-pharmaceutical platforms. This cross-platform innovation drives future value creation and supports the potential for additional licensing and monetization opportunities in animal and human health. While our internal resources remain focused on generating near-term revenues through high-value nontherapeutic proteins, these externally funded biopharmaceutical programs provide valuable nondilutive funding and global validation of our technology. With that, I'll now turn the call over to our Chief Financial Officer, Ping Rawson, who will walk you through our third quarter 2025 financial results.

Thank you, Mark. I will now go over our key financial results for the quarter ended September 30, 2025, in more detail. You can find additional information in our earnings press release and Form 10-Q, which we filed earlier today. Total revenue for the quarter ended September 30, 2025, decreased to $1.165 million compared to $1,958,000 for the same period a year ago. The decrease was due to decreases in research and development revenue of $183,000 and license and milestone revenue of $1.425 million from the Pine agreement and enzyme agreement in 2024. The decrease is offset by an increase in grant revenue of $815,000 from the Gates Foundation and CEPI grant in 2025. Cost of research and development revenue and cost of grant revenue for the quarter ended September 30, 2025, decreased to $255,000 compared to $396,000 for the same period a year ago. For the quarter ended September 30, 2025, cost of grant revenue from the Gates Foundation and CEPI brands was $769,000 compared to 0 for the same period a year ago. Research and development expenses for the quarter increased to $572,000 compared to $460,000 for the same period a year ago. The increase was driven by a rise in the number of active internal research initiatives undertaken to expedite product development. G&A expenses for the quarter increased to $1,481,000 compared to $1,298,000 for the same period a year ago. The increase reflected increases in rebranding and business development expenses of $176,000, legal and accounting expenses of $83,000, partially offset by a decrease in share-based compensation expenses of $79,000. Loss from operations for the quarter increased to $1,925,000 compared to $203,000 for the same period a year ago. Net loss for the third quarter of 2025 increased to $1,976,000 or $0.06 per share compared to $203,000 or $0.01 per share for the same period a year ago. As we reported earlier, on August 1, 2025, the company closed its public offering of 6,052,000 shares of its common stock at a public offering price of $0.95 per share. The net proceeds to the company from the offering were approximately $4.9 million after deducting legal expenses, underwriting discounts and commissions, and other offering expenses. As of September 30, 2025, cash, cash equivalents, restricted cash and cash equivalents, and the carrying value of investment-grade securities, including accrued interest, were approximately $10.4 million compared to $9.3 million as of December 31, 2024. On October 14, 2025, we received a third and final milestone payment of $0.5 million from Proliant upon meeting a certain productivity threshold, which was now included in the cash balance as of September 30, 2025. For the rest of 2025, we expect to see growth in product revenue in our life sciences and food and nutrition markets as we launch products in cell culture media and molecular biology while maintaining our operating expenses in line with last year. With that, I will now ask the operator to begin our Q&A session. [Operator Instructions]. I will now ask the operator to begin our Q&A session, after which Joe Hazelton, our COO, will provide closing remarks. Operator?

[Operator Instructions] First question comes from Matt Hewitt with Craig-Hallum Capital Group.

Maybe first up, and I apologize if I missed this, but earlier this week, you announced a new relationship with -- that's going to grant you access to CRISPR commercial licenses. I'm just curious, what does that bring to your portfolio? How is that going to help you drive incremental growth and sign some new contracts?

Matt, it's Joe. It's a great question. And the license that we signed with ERS Genomics earlier this week actually gives us a more powerful genetic toolbox to accelerate product development, improve optimization yields, both with our internal pipeline, but also with our customers. Having access to the CRISPR technology actually helps our partners for some of them that are like food and nutrition, CRISPR licensing can be somewhat problematic. So us having access to the technology to use in these development programs gives us a competitive advantage in some of these markets, as well as the ability to expand and accelerate our internal programs. So we see this as a great opportunity to enhance the already strong genetic toolbox that we have.

And then maybe a follow-up question. And picking one is tough, but I'll just go with this one. The DNA 1 opportunity. It sounds like you're making progress there. How should we be thinking about that opportunity ramping '26 and beyond? And how big could that ultimately become?

Again, a great question. So the market itself for DNase1 is roughly a $250 million market for recombinant products today. Overall, it's closer to a $1.5 billion market for DNase1 for all methods of production and platforms. So as we look at what we're looking to do, we're targeting distributors, suppliers, and manufacturers for bulk sale opportunities. So we're not going to be manufacturing or selling to like individual institutions in small orders. The goal is, and our focus right now is on securing OEM agreements or broader bulk opportunity. So we expect to see it scale rather rapidly. Obviously, we're getting lab-grade material up first. And as we start to expand the quality of the material, so moving up to like ISO and even GMP grade, those are very expensive to manufacture. So as we get the initial revenues in, we'll be able to target higher-margin segments. So it will be a slow growth at first, but we anticipate it to be steady, given the expansion of the DNA and RNA products in the market itself. I mean there's a ton of -- not just in mRNA still, but a ton of opportunity in cell and gene therapy as well as other markets where we think we have a great opportunity and advantage given our cost structure in that segment.

Next question, John Vander.

So I wanted to ask about the other relationship that you announced with Intralink in Asia. What characteristics of the customers do you think there will be for the -- for those products there, the DNase1 and the transferin? Will those be academic centers or labs? Or what do you think those customers will be?

John, this is Joe. It's a great question. So the reason we're targeting those markets specifically is that they're experiencing a significant growth in the uptake of these products with cell and gene therapy manufacturers, suppliers, and distributors. There are several new companies and several existing companies that are very large. We're targeting those organizations for purchase orders and bulk purchase orders, and then they would, in turn, supply the end users. We're not looking obviously to become a wholesale distribution network to every supplier or every academic institution, but we want to hit where they're pulling their products from.

And I think, John, one of the things you should keep in mind on all these programs is we're dealing with global markets. And as Joe points out, Japan and Korea are expanding, and they're not in turmoil like in the U.S. So our global presence is paying off. As you know, we are heavily involved in Europe and now in Asia and Japan, of course, in the United States, but India and other countries. So we're kind of like in a lot of ways, protected from what's been going on here in the United States to some degree, and because we really have a global footprint, and we're expanding that global footprint, ThmBox as well.

And that's a great point because in addition, a lot of the companies are worried with regard to the tariff situation. So in Japan and Korea, they are looking to improve their manufacturing capability in the homeland. So obviously, us having the ability to transfer our technology anywhere in the world gives us an advantage. So I think, Mark, you're absolutely right.

Well, they need a lower cost of goods to offset the tariffs to ship back in the U.S. So it's opening up doors that heretofore might have been closed.

Would the tariffs apply to your product? I mean, since it's a technology transfer rather than a product itself crossing the border, would that be something that you'd have to worry about? Or would the customer have to worry about in Japan and Asia, and other places outside the U.S.?

Yes. I think the tariffs would be on the products coming back, not on the technology going out.

Next question, Robert Hoffman with Princeton Opportunity Management.

I just want to dig in a little deeper on the CRISPR ERS agreement. So is that something you had to pay anything upfront, and I'm assuming it might be modest. And then how does it work going forward if you -- let's say discover a system within their genomics and -- are they going to get a royalty on the sales of that? Can you just kind of -- I know you can't give specific numbers, but if you can kind of walk us through how a license agreement like that is structured, I appreciate it.

Well, first of all, to your point, I think Joe did a great job in negotiating the deal with ERS Genomics. You got to remember, we're not cutting and clipping out things going into human bodies. We're improving fungal cell lines to make them more efficient, to make them cleaner, to knock out things that might be problematic, improve qualities. And so I can't get the finances to your point, because it's confidential. But I can assure you, it's nothing like you hear about the CRISPR being used in the pharmaceutical and the medical industry. This is really more about engineering cells and making them home at a higher level faster, quicker, and cheaper than they already are. So as somebody brought up, I think Matt pointed out earlier, we're expanding the opportunities. Our customers don't have to use CRISPR. We have different technologies. We have a site-specific integration, which can allow you to do things repeatedly from a genotype, from a regulatory perspective. In the life sciences and food and nutrition, we can do random in a lot of ways, random will give you the same result as CRISPR, but CRISPR is a little faster and a little more directed. But if you screen more mutants, you might get to the same point. So it gives us an advantage of time and specific ways to manipulate and modify these cells. So I think I wouldn't worry about the back end because the back end, you more than make up for it. If you get higher productivity, you can afford to pay a little bit of a payment to the ERS Genomics. And it's a great deal for them as well because it's opening the door to a whole new area that here before they couldn't get into.

Next question, John Vandermosten.

My follow-up question is on the infant nutrition product. Is that something new that's being launched? Is the customer trying to differentiate it from an animal-based product or something? I want to see if you can help me understand how that product will be marketed to the end customer.

I think in infant nutrition and medical nutrition, what they're looking to do is basically mimic human breast milk. That's really the -- one of the key focuses. The other is, obviously, they want to mimic bovine milk as well. I think you'll see the bovine products be accepted or recombinant non-animal bovine products will probably be accepted first, because that's a shorter -- I guess, a shorter leak for most consumers and most larger companies to take, because they're currently using an infant formula, they're using bovine source materials. So when it gets to things like infant nutrition, ultimately, the goal would be to mimic human breast milk. That would be the ultimate goal. But having human alpha-lactalbumin, I think you'll see it in like medical nutrition, sports nutrition products, prior to seeing it in infant nutrition. But that is exactly what they're trying to do. There's only, again, so much like actually naturally derived human breast milk that can be produced in a given year, as well as bovine milk as well. Those are self-limiting, or I won't say unsustainable, but they're very difficult to scale to significant levels in certain cases when you're talking about the purity and consistency you need for something like infant nutrition. So the recombinant proteins themselves give them greater assurance of the product quality and better control of the manufacturing process than you get with animal or even human-derived proteins. So the goal is there. The road map is there. Obviously, getting past some of the regulatory hurdles and then consumer issues as well, that will take some time. But we do see this as a great opportunity.

And just to add a little color to that, just like for Proliant, we've got partners that we're talking to and working with that have decades of experience in this industry. So it's not like we're tackling this on our own. We're aligning our interest with people that actually have the knowledge and the expertise to drive this forward to commercialization. If you think about omega-3, which is kind of a similar thing is used in infant formula, for example, these are multibillion-dollar product opportunities. And DSM paid Martech over $1 billion several years back. And it wasn't too long ago that we had this infant formula shortage. So that was a big deal. But this is a huge opportunity, and we're addressing it not on our own, but in partnership with what we think are some of the smartest people to have the industry experience for decades.

[Operator Instructions] Next question comes from Tony Bowers with IntroAact.

I know the grant business is pretty much of a breakeven proposition initially, but it's great credibility, great visibility, and validation. What do you think the positive endgame could be from the Gates Foundation and CEPI?

Well, the positive endgame could be saving hundreds of thousands, if not millions of lives, and getting rewarded for it financially. So I mean these people have the wherewithal of the Gates Foundation to move this to the clinic. And it isn't just about that. This opens up the door for monoclonal antibody production and development of a faster, quicker, more efficient way, lowering the cost of goods. If this administration wants to do anything, they want efficient, low-cost biologics because you've got Lilly, you got Pfizer, you got Novo, Trump calling into the office, and they're all caving in. But guess what? That's a drop in the bucket compared to what we can do with this platform to drive the cost of biologics down. So there's huge opportunity in the end. But it's also providing technology and advancements for Dyadic.

Well, in addition, Tony, it also gives us some potential avenues for cell culture media. So on one side of the fence, while we have the capability to produce mAbs, we're producing things like transferrin and growth factors. And when you look at those markets themselves, the growing interest and demand for therapeutic proteins means that there's going to be growing interest in demand for cell culture media of all types. So as we're looking to launch transferrin very quickly here into the cell culture media market, not just for cultured meat, obviously, but we're looking to launch into the CO market, the HEC market, where you need these high-quality, high-purity proteins at a reasonable cost in order to be able to produce some of these more high-value targets like monoclonal antibodies. So it really, to me, it not only validates our platform for biopharmaceutical use, it's giving us potential opportunities for us to get our other products in there as well.

All 3 of the products that you're planning to manufacture under your own name, DNA transfer and growth factor, they're all essentially they have been derisked in terms of production validation. And the CDMO market, there's plenty of choices. That's not a bottleneck for you commercializing these?

No, not today, Tony. It's a great question. Right now, there's plenty of capacity with CDMOs. Obviously, from our standpoint, it's the cost of producing some of these grades that we have to be considered of. But today, we are not finding that type of an issue. The other thing we're trying to do is identify opportunities in market, right? So whether it's Japan or Korea or whether it's in the EU, we're adopting we're trying to bring CDMOs in all different parts of the world, obviously, to reduce our tariff implications and to improve the economics of being able to distribute these products in both. So we haven't seen that to be an issue as of yet.

Last question, if I may. Can you comment on the burn and how much ability you have to do what you need to?

Yes. Tony, this is Ping. We don't normally give the cash guidance, as you know, but as close to the end of the year, as you can see at the third quarter, I think we are still expecting the last quarter to have the recognized the $0.5 million cash in October, we received Proliant. So that will be reflected in the Q4 financials. And also from a business perspective, I think we are still expecting certain product revenue, even though the amount may be not disclosed at this point. So it's really hard to give you the actual cash burn at this point. But we do -- like I said in the script, we do expect the operating expenses will be in line with last year. I hope that helps.

Next question, Robert Hoffman.

Just actually pick up on that question. Moving forward, in terms of like just headcount and expenses, obviously, you're outsourcing a lot of things, especially the marketing and development, although maybe not the development. But what do you see out 2 or 3 years? Are you going to have to expand dramatically? Or is it something that operating leverage is such that you have to increase your cost structure by 50% while revenue goes up multiples of that? Can you give us just some sense of how the business model scales?

Yes. Actually, it scales rather easily, considering the model that we're focusing on is the distributors, wholesalers, and suppliers. So from an infrastructure standpoint, that's not going to require significant amounts of build. So even as we scale, it's really about your manufacturing capacity and getting product to those customers. So that we can do, obviously, through our current outsourced model. So we don't anticipate significant infrastructure changes in the next 2 to 3 years. Now obviously, as we continue to move forward, and if it makes sense to grow in certain areas, we want to take a look at that. But right now, the quickest path to acceleration is more product that we're able to actually produce and get on to the market. So that's really the main focus right now.

So you don't see G&A expense blowing up as your revenue expands. Obviously, it's going to grow, but it's not going to keep pace with your revenue.

There are no further questions. I will now turn the call over to Dyadic President and COO, Joseph Hazelton.

Thank you, everyone. Putting today's call in perspective, we're very encouraged by the progress we're making. While, of course, we want to see larger gains come faster, the indicators for growth are clear. Our pipeline is advancing, customer engagement is increasing, and the foundation for sustained commercial expansion is firmly in place. Q3 2025 marked a defining step in Dyadic's commercial evolution. With our first bulk order, additional purchase orders underway, multiple product launches approaching, and we're now executing as a product-driven biotechnology company. With the integration of the CRISPR technology, the commercial expansion through Intralink, and strong balance sheet of $10.4 million in cash and investments, Dyadic Applied BioSolutions is well positioned to deliver sustainable revenue and growth and long-term value creation. In parallel, our legacy biopharmaceutical programs and collaborations continue to advance, providing validation for our technology and the potential for longer-term revenue streams as those programs mature. At the same time, our near-term focus remains on executing the commercial strategy already taking shape across our core markets. Our near-term priorities are clear. First, to accelerate product sales across our Life Sciences and molecular biology reagent portfolio, where early commercial traction is already underway; second, to expand customer engagement in key global markets, including Asia, Europe and North America through targeted partnerships and business development initiatives; and third, to advance commercialization in our Food, Nutrition and Bioindustrial segments where our technology is enabling new sustainable solutions and creating meaningful opportunities for recurring revenue growth. Dyadic is now executing as a commercial organization built on validated platforms, established partnerships, and a clear path toward recurring revenue and profitability. Thank you for your continued support, and we look forward to updating you on our progress.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines at this time.