Okay, thanks everyone for joining us at HealthCONx . I think it's the first time we're doing from Miami, so this should be pretty exciting away from Boston. A pleasure to kick things off with Twist Bioscience. We have CEO, Emily Leproust, and CFO, Jim Thorburn. Emily, Jim, thanks for coming here.
Thanks for having us.
Fantastic. So maybe, just given you had your fourth quarter results, I want to kick things off with, the numbers that you guys printed. You know, some of your peers, when I look at genomics, consumables, end markets, they talk about challenging end markets. Despite that, you guys did high teens. Maybe high level, like, what is different? Why is Twist seeing a different, you know, trend here? Is this just a scale, you know, issue, or perhaps something is, different for Twist?
Yeah, thanks, thanks for the question. And so for us, what we've always done is try to leverage the platform to have highly differentiated products. And I think what we are seeing now is the benefit of that investment. We're leveraging that investment. If you look at NGS, what we do is we provide a higher quality product, which means that when you go do the sequencing, you only have to sequence half as much. And so essentially, what we sell diagnostic companies, we sell an improvement in gross margin. Because, again, the total cost per sample would go down, and a number of those companies are under funding pressure.
They do need that extra gross margin, and so we're seeing a trend where people are abandoning older tests, which was not under Twist, and then are focusing on new tests, which are powered by Twist. And so in NGS, that gives us some really good tailwind. If we look at SynBio, what we sell our customers is more shot on goals. A lot of our SynBio customers are pharma companies that are developing drugs, and with the DNA that we make using our platform, we're able to provide a better price point. But they spend their budget, which means that they get more shots on goals. So that was the story up basically until July. Until July, in July, we started to launch faster products in SynBio.
In summer, we had faster gene fragments. Just before Thanksgiving, we launched Express Genes. In early 2024, we launched more Express products. So not only now customers have the benefit of price, but in addition to that, they have an access to unmatched speed, and that is resonating well in the science that they are doing. So I think what you're seeing is we have leveraged the silicon platform to make products that are higher quality, faster, price better, and I think in a funding environment that is under pressure, our product just resonates perfectly.
Great. Before we get into express genes, fast genes, I did want to maybe touch upon a couple of points you mentioned. Lower price point in NGS. NGS grew 27% in Q4, and when I look at some of those end markets, you know, again, we hear the same macro sort of concerns, right? In those end markets. When you think about some of the new systems coming on, you know, NovaSeq X, and, you know, price points coming down, and, you know, your customers are in a talk about destocking. Like, how is Twist able to grow 27%? Is your- you know, when you, when you report the number 27%, is that correlated to run activity, and it doesn't correlate with the price point for sequencing?
Yeah. So, maybe a point of clarification. In a NGS experiments, you have the price of library prep capture, and then you have the price of the sequencing. The price of library prep and capture that we have is essentially the same as the competition, so we're not lower price there. Yeah, we're market priced. However, what we do is we halve the price of the sequencing. In other words, if a company was able to put 100 samples per lane, now they would be able to put 200 samples per lane. Or if they were able to put two samples per lane, now they'll be able to put four samples per lane, or 1,000, 2,000.
So that, that's what we enable, is we enable them to put twice as many samples per lane, which means that as their volume ramps, as the number of samples ramps, they don't have to buy as many sequencer as quickly. Because essentially, their CapEx investment in the sequencer enables them to do twice as many patient samples as they could. As far as switch in platform, our kits are basically independent on the platform. You can run it on a MiSeq, on a NovaSeq, NovaSeq X. You can put it on an Element, or any other sequencer. The one area where we do need a slightly different kit configuration is between short read or long read.
Some of our customers have moved on to PacBio or Oxford Nanopore technology. There, you need a different kit. It's a different probe design. And so essentially, if you have a short-read kit, you can put it on any short-read sequencer. If you buy a long-read kit, you can put it on any long-read sequencer.
Understood. And Emily, just on that point of lowering cost of sequencing, how are you able to enabling that? I think you mentioned 2x higher number of samples. How does that work? I mean, if I'm a customer, if I want to sequence a cancer sample, I have a certain depth in mind, like, how are you able to change that?
Yeah. So that's a great question. So if you're a customer, a cancer customer, you decide the regions you want to look at. You may want 500 genes, you may want 25 genes, you may want 2,000, but you tell us, those are the genomic regions that you're interested in. Then I will turn that into a design, and that becomes a number of oligos that you need, and so a number of probes. So you may, on the high end, you may need a couple million probes. On the low end, you may need 100,000 probes.
So if we take something in the middle, let's say 500,000 probes, we can buy them from our competitors, but the price will be about the same as us, as I mentioned, but the difficulty will be in the quality. If you make 500,000 probes in 500,000 tubes, at the end, you have to combine into one tube, and that combination creates a lot of variation. The platform that we have, the silicon platform, we make all of those probes at the same time on the same chip, which means that they are already pre-blended, pre-normalized in some ways, which means that when they are put together in the tube, the evenness, the distribution is much, much better. That's the quality difference. Our distribution is tight.
The distribution of the competition is very broad. And so when you go and you sequence, if you have a broad distribution, some cancer genes may have the right read depth, which is 500, but others will have too much. They'll have 2,000 coverage, and yet others will have not enough. They'll have a 100X coverage. And so that means that for that sample, you're going to have to over sequence to lift the 100X coverage up to 500, and that is wasted sequencing. Whereas with Twist, the distribution is very tight, and so you, you may have a distribution between, let's say, 450 to 550, coverage, and you don't have to spend that extra sequencing.
So that's where we save cost per sample for the customer, is by providing a tighter distribution of probes, and that's how you're able to put twice as many samples per lane.
Understood. And maybe within NGS, can you talk about your customer mix between in a biopharma, diagnostics, government, academia? Any trends you're seeing across those three different end markets?
Yeah. So in NGS, we are most of our customers are in diagnostics, so diagnostic companies. And the trend that we are seeing is that, you know, those companies, the industry is under tremendous pressure to reach profitability. And so I think what we are seeing is consolidation of menus. In the past, they may have had dozens, 100 different tests, different panels, and what we're seeing is that companies are focusing on a few panels that are commercially viable, and those panels are usually the newer panels, and the older tests are being obsoleted, basically. And so those older tests, they were developed before Twist was even selling NGS products. And so when those products get removed, there's no impact on us. But when they move on to...
And then when they focus on the newer tests, those are the tests that we've been baked in over the last few years. And so what we are seeing is a shift of samples away from older tests that are not profitable to our new tests that are higher margin, and those tests are powered by Twist. And so that's how we're able to benefit from this tough funding environment. And the majority of our revenue in NGS is diagnostic companies. We don't have a lot of exposure to academic yet. We've recently launched our RNA-seq product line that is focused to the academic market, and so we're still in the ramping phase. And so I think there's only upside for us in academia with RNA-seq.
Yeah, I think it's kind of interesting. We've got about 1,000, overall 1,000 NGS customers. We track the top 270, 280. We define the top customers as those that revenue $250,000 per year above. If you look at that growth over the last few years, our bookings, we're exiting Q4, $39 million, and the top ten customers contributed about 37% of our revenue last year. We keep seeing that expansion in the lower tier customer accounts that Emily is representing. So you'll see some growth over there over the next few years. The top accounts, I mean, diagnostics, liquid biopsy, certainly helped us, and NGS continues to, as Emily's highlight, see more applications. So that's why we feel good about where we're going with NGS.
... Understood. Jim, maybe a follow-up to that. I look at the guidance for fiscal 2024. Q1 seems to be pretty strong, and that's true for NGS overall company, and then back half, you know, your annual guidance implies some moderation. Is that just a, you know, some conservatism being baked into the guidance? Are you seeing anything from order trends or customer trends that's causing this sort of strong Q1, maybe moderation in the second half?
Yeah, the Q4, I mean, as I highlighted, the Q4 orders was $39 million for NGS. The way we build up our forecast is we get input from all our customers, or certainly the top 40, top 50 customers that we see that contribute towards a significant part of our revenue. We get the profile by quarter from customer. So coming off Q4 into Q1, which is coming off the September quarter into the December quarter, orders were strong, the insights from our customers were strong. If you go back to this time last year, we saw a sequential decline. Why was that? Because some of our customers pushed shipments from December into January. We haven't seen that this year.
We're anticipating as we go across the year, we're going to continue to see traction in terms of spreading out into the lower tier customers, and that's why we see, you know, starting off at, you know, strong, strong Q1 and then gradually increasing across the year.
Just, you know, you mentioned, you saw strength in orders. You know, September was strong. As you look at year-end, has there been any budget flush, does it matter for you guys? And what have been customer trends when you're looking at, you know, October heading into November?
So you're talking about... That primarily impacts SynBio. So if you look at our SynBio revenue from Q4 to Q1, is actually relatively flat. You know, SynBio had a really strong, you know, fiscal 2023. Here we exited roughly at $26.5 million, almost $27 million revenue for SynBio. That's up from $20 million in Q1. So we've seen strong growth. Why we've got a strong growth? One is the impact of turnaround time, continuing to expand customer base, and the impact of the Factory Future. As we see this year for SynBio, we're going to scale across the year, and that's the benefit of continued customer expansion and the impact of Expressed Genes, which we see having stronger impact in towards the end of Q3 and into Q4.
Understood. And sorry, just back on at that point, Jim, you would say from a macro perspective, just because there are so many moving parts, would you say, heading into Q1 here, like there's been no change in the trends? What was, you know, relative to your fiscal fourth quarter, any change in macro or customer activity level at all?
No, I mean, I think, I mean, back to the point that Emily's made is we've got strong value proposition. I mean, I met with a customer last week, no, the previous week, billion-dollar revenue, 7,000 employees. The message they gave at the beginning of the meeting is turnaround time is important to them. Message in the middle of the meeting is turnaround time is important. The end of the meeting was, "Jim, remember, turnaround time is the most important thing." So, so what we have is we brought on the Factory Future. You're seeing the customer growth is very important for turnaround time. We're, we're giving a great product at a, at a, you know, a strong value proposition as the current macroeconomic environment, and that's going to attract more customers.
Hey, if I can build on that, maybe one of the things that may be hard to see from the outside is how different is the DNA that we ship to our customer. So it may be one product, you know, genes, but if you go on the website, there's 1 million combinations. And so, you can get a fragment, you can get your gene in a vector, you can get it dry, you can get it resuspended, you can get it normalized, you can get it in tubes, in plate, in echo plates. You can have a micro prep, a mini prep, a midi prep, a maxi prep.
You can have IgG, and you can have oligo pools. And so basically, what that means is that we're not trying to push one thing to customer. On the contrary, what we're trying to tell customers is, "Do your science. We'll deliver the DNA exactly in the flavor that you want to need your flavor." So what that means is that we can enable a very wide range of applications, thousands of customers. And so I think that makes us extremely resilient to maybe macroeconomic trend, because we have created mass customization of DNA writing exactly to the specification of the customers, and we can do that in a way that scales beautifully. And so I think that helps us a lot.
It's not just, you know, what happens to biopharma. It's there's many different level of science that we enable. We enable cell engineering, we enable enzyme engineering, we enable antibody engineering. We now we're even being dragged into mRNA drug discovery. And so, again, that ability to massively customize how you get your DNA, it gives us a lot of resilience compared to what could happen in the markets.
Understood. Would it be fair, Emily, to say, you know, that Q4 order was really, really strong. It was pretty impressive, right? Was there anything one-off in Q4 which showed that in a strong order trend, or would you say, look, it was Twist gaining share, and Q1 seems to be business as usual? Would that be a fair comment?
I mean, look, we've been at this a number of years now, and I mean, we're expand the portfolio, get a strong value proposition. We're only penetrating, what, 3-3.5 thousand customers. There's 100,000 more customers to go. And we've demonstrated that since SynBio brought down turnaround time, we've seen those customers come. And what's interesting is the number of customers at SynBio, say, there are now more than $500,000 a year and above. I mean, that keeps growing. So not only are we have the long tail, we were seeing penetration in pharma and larger customer base as well. And we used to be sort of dependent on one large customer a number of years ago.
They're no longer, you know, they're no longer material to us. So you've seen all the applications Emily's talked about being attractive, being a very attractive proposition.
Understood. Emily, back to you. You did bring up Express Genes. Why, you know, high level, what is this, and why does it matter to your customers?
Yeah, so high level, the market for clonal genes is 10 days. You go to any customer, sorry, any competitor, and it's about, you know, 10 days to make a gene. And if you pay a lot extra with our competition, you know, your gene will skip the queue at every step, and you may be able to get it in 5 days, but that's heroic, and it's very expensive, and it can only happen for a very small subset of genes because not everything can skip the line. So that has been the market for years. And at Twist, when we started, actually, we were a slow supplier.
Our, I think our first month, we had 30 days turnaround time, and over the last six years, we brought it down to be best in class in some ways where, you know, we were shipping in 10 days, like, like the market, like everybody else. We also recognize, as Jim mentioned, as we talk to customers, that turnaround time was really the biggest driver of decision-making for our customers. And so we've made an investment in the factory of the future way back in 2020 to increase our capacity, but also be in the position to decrease the turnaround time substantially.
So that's why we made the investment in factory of the future, and now, now we have, after that massive engineering investment, we have the ability to make genes in five days. But the big difference is that it's not heroic, where some of the genes are able to skip the queue and be made in five days. It's a new line where all of the genes are made in five days, and so 100% of our genes are made express. However, we're able now to offer a differentiated offering to our customers. They can still get the same speed as previously, which was 10 days, and if you order it at standard speed, you're either going to wait before the synthesis starts or after the synthesis starts, you're gonna get it in 10 days.
We're now able to offer a premium offering, where you can get your genes in five days. So now, five days is actually, in some ways, in my view, it's only in class. We're the only one to offer five days at scale. Again, you can get five days for one or two genes, but we get five days for tens of thousands of genes. And so now we're able to differentiate ourselves, and the way we've set up the production, the COGS of an express gene or the COGS of a standard gene is the variable COGS is the same, which means that any increase in pricing that we get from express, that's 100% margin impact.
So now today, you go on the website, and we'll tell you the price of a standard gene, and then for an extra, you know, $108 for your gene, you can get it in half the time, and the customer makes the decision every time, is that delta, that premium, worth their time in the lab? So that's what we're offering. We are adding a, I'll say, sorry for the pun, but we're adding a twist, where in the pricing on the website, the pricing is not fixed for express gene. The pricing is dynamic, based on how full the fab is. 'Cause what we want to do is we want to drive utilization. We want to have on our silicon chip, on our platform, we want to run full chips.
And so if the chip is almost full, the price will go up, and because, you know, the plane is full. But if the chip is more on the empty side, the premium will be lower. And that premium will change. And so, for instance, the week before or the week since we launched, the premium has been between as high as 100% and as low as 20%, and it's changing all the time. But that dynamic pricing is going to enable us to make sure that we don't leave money on the table and do the price discovery per industry, per customers.
And then if customers want to negotiate a fixed pricing, we'll do it, but we'll have information on what is the value that they place on 5 days versus 10 days turnaround time.
That, that's helpful. Price premium, in fact, 20%-100%. Is there. You know, you mentioned clonal genes. What percentage of your genes that you ship to customers are these clonal genes? Is that the majority, and are there customer segments who value this faster turnaround time?
So I'll start with the segment and I'll let Jim answer the... I know the numbers, but I don't know if we've made it public. So in terms of the segment, the segment—there's two segments that value speed. The first one is biopharma companies. And I see those customers all the time, and basically what they tell me is, for their slow need, so 10 days, they come to us. So we have all their 10 days business. But they have also half of their volume is actually for genes where they need it faster, they need those faster. And therefore, they have in-house, they have a core lab that is making their own mutation, they are cloning their own DNA to get the speed.
And so the opportunity for us is to get that second half of the business from biopharma company. So that's the first segment. And then the second segment are academic group. I think less than about 20% of our revenue last year was academia, so we're under-penetrated in academia. Jim mentioned we have, in our own market research, we find that we have 4% of the customer, even though we have 20% of the market for gene making. That is because we've been focusing on large companies, and we have under-penetrated the long tail of academia. We find that a academic group, they're very, very time sensitive.
If you're a postdoc or a grad student trying to publish, you're going to go clone for five days in the lab rather than wait for an extra five days to have someone else clone it for you. And so their speed is very, very important. In terms of the ratios-
Yeah, so ratio clonal, non-clonal genes, I mean, historically, we discussed this a number of years ago. So clonal genes are about 75% of the business. Now, it varies, you know, quarter to quarter, but it's been roughly around 75%.
Sorry, how big is the overall gene synthesis for Twist?
So, how big is overall genes? Last year it was about $73 million in terms of overall genes. Overall SynBio is about $98 million, almost $100 million. So you get, genes, oligo pools and libraries are the key products that make up SynBio.
Then I'll say that our commercial strategy is ultimately we want—we'd like to have 100% of our gene sales as clonal. In some way, the fragments are the entry point. And we've priced our fragment at $0.07 a base, and we priced our clonal at $0.09 a base. And so once we get into customers, we convince them to use our fragment, you know, they clone themselves, then we can tell them, "Do you clone for $0.02?" And the answer is always no. It costs a lot more to clone than $0.02 to our customer, and so therefore, we can drag the customers to clonal, and that's one area where the competition is struggling.
So, we take a lot of market shares from IDT, gBlocks and eBlocks, with our fragments, but also by converting then the customers to the clonal genes, that is an area of weakness for IDT.
I see. And you mentioned, you know, the dynamic pricing, it depends on, you know, what the capacity on the chip is. Have you seen any trends so far, you know, customers, you know, came with an initial order and now they're happy. Are they increasing their order size? Or maybe just give us some sense on customer feedback to this product?
So I'll choose my word carefully, so it's early days, but maybe I'll give an example of one customer, which will be unnamed. The first week of Express Gene, and so they placed an order, I think on a Tuesday, and the premium was 40%, and they did not pick Fast Gene. And then they came back on the Thursday, the premium was 60%. They placed another order, they didn't pick Fast Gene, and on the Friday, the premium that day was 20%. And they not only placed the, they chose Fast or Express, a few hours later, they came back to place another Express order. And so to us, it tells us that for this one particular customer, it was probably between somewhere between 20%-40%.
That's where the premium that speaks to them lies. And so of course, we'll gather data over the next few months, but when it's time to negotiate a fixed pricing, we have good insight into the pricing that triggered an order as expressed, and a pricing that did not trigger an order in Express.
I see. And is the idea, Emily, here, now that you get a sense for a price elasticity of demand, you would negotiate fixed pricing with these customers down the road at a certain price point?
Anytime we are happy to negotiate a fixed pricing in exchange for a guarantee of demand for us, right? So we give pricing and guarantee of supply in exchange for guarantee of demand. So similar to the deal that we—the $54 million deal we signed with Ginkgo the year before. There's a very good price that's fixed, there's a guarantee of supply, and in exchange for it, there's also a guarantee of demand. So, definitely, I think it's in our advantage to lock in as many customers as we can into long-term contracts-
Mm-hmm.
that will really hamper the ability of competition to come in and compete with us.
Understood. Maybe Jim, one for you on your pharma segment guidance. I think guidance was $25 million for the year, and you're starting Q1 at $4 million. That's a pretty big, sequential step up throughout the year. What are you assuming? What gives you the visibility why pharma should step up?
So, in terms of the, you're talking about the biopharma business?
Yes.
Yeah. So if you look at the orders in Q4, orders come in just under $6 million. As we highlight, we've been rebuilding the business development team. We have, in terms of in vivo, in vitro AI, a very strong product offering. Plus in terms of quality of services, speed. So we are very attractive proposition in the marketplace. So if you just step back and you may be seeing some recovery going on there, we also think that we wanna be modest and thoughtful in terms of forecasting there, because we've gone through this sort of disruption over the last year, rebuilding the team.
But the order book in Q4 was great, coming in at, I think it was $5.8 million. So in terms of that, we feel as if we've got a solid base for the year. Team is doing well, continuing to build the funnel and continuing to convert.
Are you seeing those signs of customer activity within that biopharma picking up now, Jim, that gives you confidence in that step up?
Well, we've seen a step up in business. Can't talk about anybody else. But I think that just goes back to the value proposition we've got. We've got a good team on board, obviously scaling. So, we think the 2024 for the year is a good, solid number to go after.
Gotcha. Emily, maybe back to you on data storage. I think, your guidance assumes $40 million spend in fiscal 2024. That, that's a pretty big expense line item for a company of your size. You know, why, why is Twist you know sticking on with data storage? Is the payoff so big? Are there some technological risks? Like, what should we expect for data storage in fiscal 2024?
Yeah. So in data storage, really the appealing aspect of it is the sheer size of the market, and how we have the ability to leverage our platform to launch a differentiated product to take market share in that huge archiving market. When we look at the opportunity for DNA and the feature that it provides compared to tape or hard drive, it is just, it's just a very appealing market. At the same time, we've made a very strong commitment to investors that we are not going to raise money, and so we have to be thoughtful.
But, we think that with the investment in the next generation of chips to address that big data archiving market, we believe that we are creating a very valuable asset for us. And so, the strength in the engineering and the progress that we are making gives us confidence in that value creation.
Understood. And from where are we from a technology perspective? Has this been de-risked technologically? What can we expect in fiscal 2024?
Yeah. So, what we have to demonstrate this until the end of this calendar year, so in the next few weeks, is the end-to-end workflow for a gigabyte archive. And so the idea is, you give us gigabyte scale of data, we're going to be able to encode it into A, C, G, T. We're going to be able to synthesize it on our CMOS chip. That's about 1 micron density. And then we'll be able to store it into DNA shell, and then extract it, sequence it, decode it, get the data back. So show that with the end-to-end workflow is working and integrated, again, with a chip in the center that is gigabyte. And we're already working on the design of the next chip, which will have a terabyte storage capacity instead of gigabyte.
And the chip is the same dimension. It's a drop-in. The innovation is in the size of the CMOS feature size. And right now, as I said, we're at 1 micron. We'll be able to get towards the 150 nanometer. But it's going to be the same size chip, and we'll be able to do a drop-in replacement in that end-to-end workflow. So in terms of once we have demonstrated the end-to-end workflow at the end of December 2023, then it will be full speed ahead on the designing, building, debugging the next chip, which is the terabyte that would be able to put into the workflow.
The plan that we've shared is that by early calendar 2025, we'll be able to have an early access for archiving at terabyte scale using our workflow.
Understood. Jim, I know China is pretty small for you guys. It was flattish in fiscal 2023. What are you assuming for China in fiscal 2024?
China, so, so it's interesting. We saw sort of, over the last year, we saw China, go through lockdown, reemerge from lockdown. Obviously, there's, challenges within the economy. So China revenue in fiscal 2022 is about $7 million. We exited 2022, last year, very strong quarter, about $2.2 or $2.3 million, I can't quite recall the exact number, dropped to about $1.4. Then we scaled this year, exiting, just over $2 million. So we see in terms of forecasting for China next year, we're roughly projecting it to be roughly flat, with, with this year. China, I mean, it's, it's not a huge part of our business, but predominantly about 80% of the China business is NGS.
Understood. Then maybe the last few minutes here, gross margin guidance, Q1, that's a 200 basis point step up from Q4. What's driving that Q1 gross margin?
Well, it's interesting. If you go, if you look at this past year, gross margin in Q2 was 30%, increased in Q3 to 34%. We exited about 30, just under 37%, 36.6% in the September quarter. As we continue to scale revenue, we see there's leveraging fixed cost. We're obviously on the factory side or the Portland side or Wilsonville side, Factory Future, we're driving a lot of efficiencies, a lot of focus on, you know, throughput that drives efficiency. As Emily highlighted, we're managing our cost structure. So our goal here is to continue to increase top line, get the benefit of premium pricing on the fast genes, see the impact of launching new products.
As we go across the year, you know, we're planning to exit Q4 next September, and margins in the low 40 percentage points.
So you said the step up in Q1, Jim, was being aided by Express Genes. Is that what's driving?
No. It's fast genes will contribute to the total year. Q1 is just a step up, is driven by revenue and continuing to manage our cost structure. As we, I mean, the key thing is, as we manage the business, managing that fixed cost, you know, working with a lot of our suppliers in terms of negotiating material cost reduction and continuing to push in terms from product side, launching new products, positive impact and contribution margin. So it's a combination of these three or four levers that will show a step up in margin as we progress across the year.
Yeah, we brought in a lot of talent in ops. We brought in a very talented VP of supply chain, a very talented SVP of ops, and so we're really leveraging our scale now and pushing suppliers with target pricing. Well, the goal is to shrink the number of supplier, concentrate our spend on less supplier, get more leverage, and then pick the suppliers that are going to work with us on long-term target pricing. So there is a very strong focus on supply chain during COVID, the supply chain was very much focused on availability, you know, staying open, and now we're also going to be able to focus on cost and pricing and then manage our inventory.
Inventory has come down, and so we focus on inventory turn, as well.
Yeah, we cut inventory down from about $39 million down to $32 million over the last year. We also managed CapEx budget very tightly. CapEx come in at $28 million. The original forecast was about $56 million. So we ended the year strong cash position at about $336 million. So our focus over the next year is managing our costs as we scale revenue. And the goal is to exit strong position next year with about $245 million cash and keep progressing to profitability.
Gotcha. Maybe last minute here, Jim, your guidance, when you look at your OpEx guidance, I think your Q4 is below a first half levels, right? Is there some incremental cost actions that's coming in the back half?
We're just, we're just managing our cost structure, as we go through the year. Yeah, we've got a lot of focus. I mean, what's important to the company is getting to profitability, managing cash, launching products, expanding, expanding our customer base. We see lots of opportunity in terms of the new products, and, you know, at the end of the day, we want to be a profitable company, and that's what we're driving to.
We announced all the cost action back in May. So not everybody left in May, but we wanted to be clear that to the company, everybody that was going to leave knew in May, and they may have left later in the fiscal year.
Fantastic. With that, we're at the end of time. Emily, Jim, thanks for your time. All right.
Thank you so much.
Thank you.