Twist Bioscience Stock: AI Deals Lift Outlook as Losses Widen

A beat on sales, a miss on losses

Twist Bioscience's fiscal third quarter of 2026 delivered one thing investors wanted and one thing they did not. The synthetic DNA maker reported revenue of $118.4 million, ahead of the roughly $114.5 million Wall Street expected and up 23% from a year earlier 1. The company said it was the 14th consecutive quarter of sequential revenue growth 1.

The bottom line was weaker. Twist posted an adjusted loss of $0.56 per share, compared with a consensus loss estimate of $0.48. That is a negative surprise of about 17% 1. The revenue beat was smaller, at a little over 3% 1. Even after the company raised its outlook, shares slipped in premarket trading following the report 1.

Guidance moves higher

Management lifted full-year fiscal 2026 revenue guidance to $456 million–$457 million. That is $12 million above the prior midpoint and implies about 21% annual growth 1. Twist also said it expects gross margin above 52% for the year. For the current quarter, it guided to revenue of $123 million–$124 million 1.

The pattern fits a company still in its scaling phase. The top line is growing steadily, and that growth is not yet turning into profit. The wider loss suggests Twist is still spending heavily to build capacity and win customers. Investors watching the margin targets will want evidence that this spending eventually produces operating leverage.

The AI drug discovery story

The quarterly figures sit next to a narrative that has done much to move the stock: Twist's growing role in AI-driven drug discovery. Twist signed a data and services agreement with Eli Lilly 2. Under that deal, Twist's wet-lab data will feed Lilly's TuneLab, an AI and machine learning platform for antibody discovery 2. The arrangement makes Twist more than a supplier of synthetic DNA. It becomes a source of the experimental data that AI models need for training and validation.

Twist has also worked with Anthropic on AI-designed mini-binder proteins 2. One market commentary argued that this project is probably already built into Twist's 2027 orders outlook. If so, it offers little room for an upside surprise 2. That is a useful caution. Investors can easily treat every AI partnership as new upside, even when management has already counted it in its forecasts.

Analysts lean bullish, with exceptions

Sell-side sentiment has mostly been enthusiastic. Leerink raised its price target twice in September, ending at $190. The firm cited conservative revenue assumptions and growing pharmaceutical adoption of Twist's platform 2. Guggenheim more than doubled its target to $212, pointing to the AI drug discovery opportunity 2. UBS was more measured. It began coverage at Neutral with a $144 target while still noting strong long-term growth prospects for life science tools 2.

That optimism showed up in trading. On October 5, 2026, Twist shares were up nearly 9% intraday, a move attributed to upbeat news on synthetic DNA demand along with the AI deals and target increases 2.

Reconciling the two reactions

The two accounts show different moods. One describes a stock falling after earnings despite a revenue beat and higher guidance 1. The other describes a rally driven by partnerships and analyst upgrades 2. These are best read as separate moments rather than a contradiction. In the short term, the market punished a wider-than-expected loss. Over a longer period, it rewarded a strategic story that analysts find increasingly persuasive.

The gap is worth noting. Price targets of $190 and $212 assume Twist's AI-linked data business becomes a lasting growth engine. The quarterly results show a company with solid momentum that is still losing more money than forecast. In practice, the bull case depends on the Lilly-style data partnerships scaling, and on revenue growth eventually closing the gap to profitability.

The bottom line

Twist enters the end of its fiscal year with real operating momentum and a story that has captured the market's attention. Revenue is beating estimates, guidance is rising, and large pharmaceutical and AI players want its data. Losses, however, remain wider than the Street wants. Some of the most-discussed AI upside may already be reflected in the company's outlook. Investors should expect the stock to stay sensitive to both sides of the story: the excitement around AI partnerships, and how quickly Twist moves toward profitability.