Akoya Biosciences(AKYA) - 2022 Q1 - Quarterly Report

PART I. FINANCIAL INFORMATION Financial Statements This section presents Akoya Biosciences, Inc.'s unaudited consolidated financial statements for Q1 2022 and 2021, including Balance Sheets, Statements of Operations, Cash Flows, and Notes, reflecting the adoption of ASC 842 Consolidated Balance Sheets Consolidated Balance Sheet Summary (in thousands) | Account | March 31, 2022 (Unaudited) | December 31, 2021 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $93,938 | $113,079 | | Total current assets | $126,466 | $140,814 | | Total assets | $187,128 | $190,907 | | Liabilities & Stockholders' Equity | | | | Total current liabilities | $31,736 | $27,682 | | Long-term debt, net | $32,576 | $32,471 | | Total liabilities | $80,576 | $69,556 | | Total stockholders' equity | $106,552 | $121,351 | | Total liabilities and stockholders' equity | $187,128 | $190,907 | Consolidated Statements of Operations Consolidated Statement of Operations (Unaudited, in thousands) | Metric | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Total revenue | $16,894 | $12,212 | | Gross profit | $10,096 | $7,405 | | Total operating expenses | $25,650 | $12,806 | | Loss from operations | ($15,554) | ($5,401) | | Net loss | ($16,399) | ($8,082) | | Net loss per share, basic and diluted | ($0.44) | ($3.54) | Consolidated Statements of Cash Flows Consolidated Statement of Cash Flows (Unaudited, in thousands) | Activity | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | ($17,932) | ($4,404) | | Net cash used in investing activities | ($1,138) | ($907) | | Net cash used in financing activities | ($71) | ($4) | | Net decrease in cash | ($19,141) | ($5,315) | | Cash at end of period | $94,240 | $12,193 | Notes to Consolidated Financial Statements This section provides detailed disclosures supporting the financial statements, covering business description, accounting policies, ASC 842 adoption, debt agreements, stock compensation, and global revenue generation as a single segment - Akoya is a life sciences technology company delivering spatial biology solutions (PhenoCycler™ and PhenoImager™ platforms) to transform discovery and clinical research[16] - On January 1, 2022, the Company adopted ASC 842, recognizing operating lease right-of-use assets of $10.4 million and financing lease right-of-use assets of $0.7 million on the balance sheet[35][86] Revenue by Geography (as % of Total Revenue) | Region | Q1 2022 | Q1 2021 | | :--- | :--- | :--- | | North America | 55% | 43% | | APAC | 21% | 30% | | EMEA | 24% | 27% | - The company has a $37.5 million credit facility with Midcap Financial Trust, with $32.5 million drawn as of March 31, 2022, at an interest rate of one-month LIBOR plus 6.35% (with a 1.50% floor) and maturing in October 2025[57][59] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q1 2022 financial performance, including a 38% revenue increase, key business metrics, factors affecting performance, and analysis of operations, liquidity, capital resources, and cash flows Overview and Key Business Metrics - The company's strategy focuses on expanding its installed base of PhenoCycler and PhenoImager platforms, a leading indicator of future recurring revenue from consumables and services[104] - Recurring revenue (consumables and services) grew to 38% of total revenue in Q1 2022, up from 33% in Q1 2021, and is expected to become an increasingly important contributor as the installed base expands[107] Instrument Placements | Period | Placements | | :--- | :--- | | Q1 2022 | 51 | | Q1 2021 | 37 | Results of Operations Total revenue increased 38% to $16.9 million in Q1 2022, driven by product and service revenue growth, while operating expenses significantly rose due to increased headcount and public company costs, resulting in a wider operating loss Revenue Comparison (in thousands) | Revenue Type | Q1 2022 | Q1 2021 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Product revenue | $13,343 | $9,963 | $3,380 | 34% | | Service and other revenue | $3,551 | $2,249 | $1,302 | 58% | | Total revenue | $16,894 | $12,212 | $4,682 | 38% | Operating Expense Comparison (in thousands) | Expense Category | Q1 2022 | Q1 2021 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Selling, general and administrative | $18,193 | $8,179 | $10,014 | 122% | | Research and development | $5,714 | $3,192 | $2,522 | 79% | | Total operating expenses | $25,650 | $12,806 | $12,844 | 100% | - Gross margin decreased slightly from 61% in Q1 2021 to 60% in Q1 2022[128] Liquidity and Capital Resources As of March 31, 2022, the company held $93.9 million in cash, funded operations through equity and debt, and expects sufficient liquidity for 12 months, despite increased cash usage in Q1 2022 - As of March 31, 2022, the company held $93.9 million in cash and cash equivalents[140] - The company completed its IPO in April 2021, receiving net proceeds of $138.6 million[141] Cash Flow Summary (in thousands) | Activity | Q1 2022 | Q1 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | ($17,932) | ($4,404) | | Net cash used in investing activities | ($1,138) | ($907) | | Net cash used in financing activities | ($71) | ($4) | Quantitative and Qualitative Disclosures About Market Risk Akoya, as a smaller reporting company, notes exposure to interest rate risk affecting customer financing and debt costs, and foreign currency risk from international expansion, without current hedging arrangements - The company is exposed to interest rate risk, as many customers rely on debt financing to purchase its platforms, though a hypothetical 100 basis point change would not materially impact Q1 2022 interest expense[149] - As international presence grows, results may be subject to fluctuations from changes in foreign currency exchange rates, with no hedging arrangements made to date[150] Controls and Procedures Management concluded the company's disclosure controls and procedures were effective as of March 31, 2022, with no material changes to internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2022[157] PART II. OTHER INFORMATION Legal Proceedings The company is not currently a party to any legal proceedings expected to have a material adverse effect on its business, financial condition, or results of operations - The company is not currently a party to or aware of any material legal proceedings[158] Risk Factors There have been no material changes to the risk factors previously disclosed in the Annual Report on Form 10-K for the year ended December 31, 2021 - There have been no material changes to the risk factors previously disclosed in the Annual Report on Form 10-K filed on March 15, 2022[161] Unregistered Sales of Equity Securities and Use of Proceeds Not applicable Defaults Upon Senior Securities Not applicable Mine Safety Disclosures Not applicable Other Information Not applicable Exhibits This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications under Sarbanes-Oxley Act of 2002 and Inline XBRL documents - Exhibits filed include CEO and CFO certifications under Sections 302 and 906 of the Sarbanes-Oxley Act[163]