908 Devices(MASS) - 2024 Q4 - Annual Report

Financial Performance - The company generated revenue of $59.6 million and $50.2 million for the years ended December 31, 2024 and 2023, respectively, reflecting a year-over-year increase of 27.7%[393] - The company incurred net losses of $72.2 million and $36.4 million for the years ended December 31, 2024 and 2023, respectively, with an accumulated deficit of $242.8 million as of December 31, 2024[395] - Total revenue for the year ended December 31, 2024, was $59.6 million, a $9.4 million increase from $50.2 million in 2023[443] - The net loss for 2024 was $72,206,000, compared to a net loss of $36,399,000 in 2023, indicating a worsening financial position[524] - Cash and cash equivalents decreased to $44,032,000 in 2024 from $121,041,000 in 2023, a decline of 63.6%[522] - The company experienced a net decrease in cash, cash equivalents, and restricted cash of $77.0 million in 2024, compared to a decrease of $67.4 million in 2023[473] Revenue Composition - Recurring revenue accounted for 39% of total revenue in 2024, up from 33% in 2023, indicating a growing reliance on consumables and services[414] - Product revenue increased by $3.7 million, or 9%, to $43.9 million for the year ended December 31, 2024, compared to $40.2 million in 2023[444] - Service and contract revenue increased significantly by 56.5% to $15,709,000 from $10,015,000[524] - Device sales revenue increased to $35,991,000 in 2024 from $33,379,000 in 2023, a growth of 4.8%[586] - The total handheld revenue for 2024 was $46,238,000, up from $38,240,000 in 2023, representing a growth of 20.5%[586] Expenses and Costs - Selling, general and administrative expenses rose by $7.6 million, or 16%, to $53.6 million in 2024 compared to $46.1 million in 2023[443] - Research and development expenses increased by $3.6 million, or 16%, to $25.5 million in 2024 from $21.9 million in 2023[443] - Total operating expenses surged to $106,574,000, a 56.5% increase from $68,080,000 in 2023, primarily due to higher research and development costs[524] Acquisitions and Restructuring - The company completed an acquisition of RedWave for $45.0 million in cash and 1,497,171 shares of common stock, enhancing its portfolio of handheld chemical analysis devices[392] - An organizational restructuring was announced in November 2024, resulting in an approximately 11% workforce reduction to improve operational efficiencies[397] - The company acquired RedWave Technology for $44.8 million in April 2024, enhancing its portfolio of handheld chemical analysis devices[536] Cash Flow and Financing - Net cash used in operating activities for the year ended December 31, 2024, was $30.2 million, an increase from $25.1 million in 2023, primarily due to a net loss of $72.2 million[474][475] - Cash used in investing activities increased significantly to $46.3 million in 2024 from $26.4 million in 2023, largely due to the acquisition of RedWave for $44.8 million[476][477] - Cash used in financing activities decreased to $0.4 million in 2024 from $15.9 million in 2023, primarily due to a payment for contingent consideration related to the acquisition of Trace Analytics GmbH[478][479] Goodwill and Impairment - A goodwill impairment of $40.7 million was recorded for the year ended December 31, 2024, representing 68% of total revenue[454] - The company recorded a goodwill impairment of $40,659,000 in 2024, reflecting significant changes in asset valuation[524] Market and Economic Factors - The company is closely monitoring macroeconomic factors, including inflation and interest rates, which may impact customer spending and purchasing patterns[401] - The company expects to transition manufacturing operations from Massachusetts to North Carolina and Connecticut throughout 2025, with associated costs anticipated[399] Customer and Revenue Concentration - One customer accounted for 15% of gross accounts receivable as of December 31, 2024, highlighting a concentration risk[545] - Government sector revenue accounted for $46,161,000 in 2024, an increase of 20.5% from $38,232,000 in 2023[586] Future Outlook - The company expects gross profit margins to increase over the long term as sales and production volumes rise and costs per unit decrease[431] - The company anticipates that its cash and marketable securities will be sufficient to fund operations for at least the next 12 months[539] - The company expects to continue generating operating losses in the foreseeable future, indicating ongoing financial challenges[539]