Azenta (NASDAQ:AZT) shares fell Wednesday after the company reported first-quarter earnings that missed analyst estimates, as costs related to its ongoing business turnaround pressured profit margins.
The Burlington, Massachusetts-based life sciences provider reported revenue of $149 million for the fiscal first quarter ended Dec. 31, representing a modest 1% increase from a year earlier.
However, the company’s adjusted gross margin fell 380 basis points to 42.9%, a decline management attributed to lower sales volumes in certain high-margin segments and costs associated with "rework" on several automated storage projects.
The results come as CEO John Marotta continues to prune the company’s portfolio to focus on its higher-growth Sample Management and Multiomics segments.
Along with the earnings, Azenta announced a definitive agreement to sell its Luxembourg-based B Medical Systems business to THELEMA S.À R.L. for $63 million.
The sale is expected to close by the end of March 2026.
For the full fiscal year 2026, Azenta reiterated its guidance of 3% to 5% organic revenue growth.
The company is also targeting an expansion of its adjusted EBITDA margin by approximately 300 basis points, banking on a stronger second half of the year as it exits non-core businesses and improves operational efficiency.