MindWalk Holdings Corp. (HYFT) Q1 2026 Earnings Call Transcript

Access earnings results, analyst expectations, report, slides, earnings call, and transcript.

Overview

The earnings call reflects a positive sentiment due to a 45% revenue increase, improved margins, and reduced losses. The transition to a bio-native AI platform and rebranding indicates strategic growth, despite execution risks. The divestiture strengthened the balance sheet, and the Q&A highlighted strong gross margin contributors and strategic partnerships. However, management's lack of clarity on some details introduces uncertainty, slightly tempering the overall positive sentiment.

Key Financial Performance

Revenue $7.6 million, up 45% year-over-year, driven by both project and product revenue growth.

Gross Profit $4 million, with margins expanding to 53% compared to $2.4 million or 45% margin last year.

Operating Loss $2.7 million, narrowed from $4.2 million a year ago, excluding amortization and nonrecurring charges.

Adjusted EBITDA Loss $1.4 million, cut in half year-over-year from $2.8 million, reflecting stronger operating leverage.

Net Loss $3 million, improved from $1 million last year.

General and Administrative Expenses Declined year-over-year, underscoring operational discipline.

Cash $5 million at the end of the quarter, plus an additional $16.1 million received in proceeds from the divestiture of Netherlands operations.

Continued Operations Revenue $3.2 million, up 28% year-over-year, demonstrating sustainable results from the core bio-native AI platform.

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Operating Highlights

Rebranding to MindWalk: Unified legacy companies (ImmunoPrecise Antibodies, BioStrand, Talem) under one identity, reflecting a shift to a bio-native AI platform company. Introduced new NASDAQ ticker HYFT, emphasizing the role of proprietary HYFT technology.

BioIntelligence Ecosystem: Integrated bio-native AI powered by $25 billion proprietary HYFT connections, multi-omic platform, and advanced lab capabilities. Focused on scalable intelligence models like SaaS, DaaS, and asset generation.

Market Positioning: Shifted from wet lab services to a scalable intelligence platform model, opening pathways for SaaS, DaaS, and large-scale partnerships.

Financial Performance: Record revenue of $7.6 million (up 45% YoY), gross profit of $4 million (53% margin), and narrowed operating loss to $2.7 million. Adjusted EBITDA loss improved to $1.4 million.

Cost Discipline: General and administrative expenses declined, reflecting operational discipline. Sales and marketing investments increased to support growth initiatives.

Divestiture of Netherlands Operations: Generated $16.1 million in net proceeds, strengthening the balance sheet and focusing resources on high-priority initiatives.

Business Transformation: Transitioned from wet lab services to an integrated bio-native AI platform, enabling new revenue streams and scalable growth opportunities.

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Risk or Challenges

Divestiture of Netherlands Operations: The divestiture of the Netherlands operations, while strengthening the balance sheet, removes a revenue-generating segment from the company's portfolio. This could impact future revenue streams and operational diversity.

Shift to Bio-Native AI Platform: The transition from wet lab services to a scalable intelligence platform model introduces execution risks, including potential challenges in scaling operations, integrating technologies, and achieving market acceptance for the new business model.

Dependence on New Revenue Streams: The company's focus on Software-as-a-Service, Data-as-a-Service, and translational programs like the dengue vaccine initiative relies on the successful development and commercialization of these offerings, which may face market, regulatory, or technical hurdles.

Economic and Market Conditions: Global political and economic uncertainties, as mentioned in the forward-looking statements, could adversely affect the company's operations, financial performance, and strategic initiatives.

Increased Sales and Marketing Expenses: While aimed at supporting growth initiatives, the rise in sales and marketing expenses could strain financial resources if revenue growth does not meet expectations.

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Guidance & Outlook

Future revenue and growth opportunities: The company plans to advance growth opportunities in Software-as-a-Service, Data-as-a-Service, and translational programs, such as the dengue vaccine initiative. The stronger capital position from the divestiture of Netherlands operations enhances flexibility for these initiatives.

Business model transformation: The company is transitioning from primarily wet lab services to a scalable intelligence platform model, opening pathways for Software-as-a-Service, Data-as-a-Service, asset generation, and large-scale partnerships.

Rebranding and strategic focus: The rebranding to MindWalk reflects a unified brand identity and a shift to an integrated platform-driven bio-native AI company. The new NASDAQ ticker HYFT underscores the role of their proprietary HIT technology in their AI stack.

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Shareholder Return Plan

The selected topic was not discussed during the call.

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Key Q&A

Q:What portion of the $4.3 million revenue from discontinued operations comes from products or AI assets that the company continues to carry?

A:The majority of the products and services are being carried forward, except for one service that is not a major cash generator. None of the AI products or services are being discontinued, and physical AI-related assets are retained by the company.

Q:How much of the gross margin contribution comes from continued operations, and what is the outlook for gross margins?

A:Canada and BioStrand are strong contributors to gross margins, with BioStrand historically achieving over 90% gross profit margins. The company expects stronger contributions from BioStrand and overall growth in gross profit margins as operations continue.

Q:What is the strategy for the dengue vaccine development beyond preclinical programs?

A:The company is focusing on preclinical trials to assess antibody production and virus neutralization. They are also working with the NIH and other partners to potentially move the vaccine into Phase I clinical trials. The company does not plan to fund Phase I trials but seeks partners to sponsor them.

Q:Will the company develop an internal pipeline or focus on partnerships to progress its pipeline?

A:The company plans to do both. They are integrating in silico applications into their wet lab processes and emphasizing partnerships with technology and pharmaceutical companies. They are also developing internal products, particularly in the vaccine space, to showcase their technology's differentiators.

Q:Review of Unclear Management Responses

A:Management avoided providing specific details on the exact portion of the $4.3 million revenue attributed to continued operations and did not quantify the expected gross margin growth. Additionally, while discussing the dengue vaccine, they did not provide a clear timeline or specific partners for Phase I trials.

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Earnings Word Cloud

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