Absci(ABSI) - 2024 Q3 - Quarterly Report

Revenue and Financial Performance - Technology development revenue for Q3 2024 was $1.701 million, up from$744 thousand in Q3 2023, representing a 128.5% increase[11] - Total revenues for the nine months ended September 30, 2024, were $3.869 million, compared to$5.380 million for the same period in 2023, a decrease of 28.0%[11] - The net loss for Q3 2024 was $27.398 million, compared to a net loss of$21.994 million in Q3 2023, reflecting a 24.0% increase in losses[11] - The company reported a comprehensive loss of $27.033 million for Q3 2024, compared to a comprehensive loss of$21.907 million in Q3 2023[11] - The net loss for the nine months ended September 30, 2024, was $74,123,000, compared to a net loss of$87,021,000 for the same period in 2023, representing a 14.5% improvement[18] - The net loss for the three months ended September 30, 2024, was $27.4 million, compared to a net loss of$22.0 million for the same period in 2023[54] - The net loss for the nine months ended September 30, 2024, was $74.1 million, compared to a net loss of$87.0 million for the same period in 2023[54] Expenses and Liabilities - Research and development expenses for Q3 2024 were $17.985 million, an increase of 63.5$11.029 million in Q3 2023[11] - Cash used in operating activities for the nine months ended September 30, 2024, was $55,438,000, compared to$49,714,000 for the same period in 2023, indicating an increase of 11.5%[18] - The company reported a principal payment of $2,489,000 on long-term debt during the nine months ended September 30, 2024[18] - The contingent consideration liability related to the acquisition of Totient, Inc. is$15.0 million, contingent upon achieving specific milestones[52] Shareholder Information - The weighted-average common shares outstanding for Q3 2024 were 113,613,488, up from 92,217,234 in Q3 2023, indicating a 23.2% increase[11] - The weighted-average common shares outstanding for the nine months ended September 30, 2024, was 108,665,095, an increase from 91,844,221 for the same period in 2023[54] - The total potentially dilutive securities not included in the diluted net loss per share calculation amounted to 24,567,869 for the three months ended September 30, 2024, compared to 18,348,459 for the same period in 2023[55] Assets and Investments - Unrealized gains on investments as of September 30, 2024, amounted to $134,000, while unrealized losses were$1,000, resulting in a fair market value of $88,928,000 for total investments[28] - The total assets measured at fair value as of September 30, 2024, amounted to$88.928 million, with $81.973 million classified under Level 2[49] - The company had total liabilities measured at fair value of$12.750 million as of September 30, 2024, all classified under Level 3[49] Stock Options and Compensation - The total stock-based compensation expense for the three months ended September 30, 2024, was $5.508 million, compared to$2.553 million for the same period in 2023, representing a 116% increase[35] - The number of outstanding stock options increased to 19,565,154 as of September 30, 2024, from 17,104,505 at the end of 2023, with a weighted average exercise price of $3.39[38] - The aggregate intrinsic value of outstanding stock options as of September 30, 2024, was$21.553 million, based on a closing stock price of $3.82 per share[38] - The company granted 2,538,737 restricted stock units during the nine months ended September 30, 2024, with a weighted average grant date fair value of$3.95 per share[44] - As of September 30, 2024, there was $7.7 million of unrecognized compensation expense related to outstanding restricted stock units expected to be recognized over a remaining weighted-average period of 1.6 years[44] Strategic Focus and Market Outlook - The company expects to leverage its Integrated Drug Creation platform to shorten preclinical development timelines for biologics[4] - The company anticipates growth in the biologics market, which will support its service and technology offerings[4] - The company plans to expand its relationships with existing partners and introduce its platform to new partners for drug candidate development[4] - The company is focused on advancing internally developed programs through preclinical studies and clinical trials[4] Other Financial Metrics - The company recognized$3,000,000 in revenue from deferred revenue during the nine months ended September 30, 2024, compared to $400,000 in the same period of 2023, showing significant growth[23] - As of September 30, 2024, contract liabilities were$1,800,000, down from $4,100,000 as of December 31, 2023, reflecting a decrease of 56.1$132,100,000, compared to $189,900,000 for the same period in 2023, reflecting a decrease of 30.3$32.374 million from $41.328 million as of December 31, 2023, reflecting a depreciation expense of$2.5 million for the quarter[32] - The company recognized a write-down of $1.1 million for laboratory equipment classified as held-for-sale during the third quarter of 2024[33] Market Risks - There have been no material changes in reported market risks or risk management policies since the last annual report[129]