908 Devices(MASS) - 2023 Q3 - Quarterly Report

PART I. FINANCIAL INFORMATION This part presents the unaudited condensed consolidated financial statements and management's discussion and analysis Item 1. Condensed Consolidated Financial Statements (Unaudited) This section presents the unaudited condensed consolidated financial statements and notes for the period ended September 30, 2023 Condensed Consolidated Balance Sheets This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity | Metric (in thousands) | Sep 30, 2023 | Dec 31, 2022 | | :-------------------- | :----------- | :----------- | | Total Assets | $208,475 | $242,587 | | Total Liabilities | $38,546 | $51,988 | | Total Stockholders' Equity | $169,929 | $190,599 | - Total assets decreased by $34.1 million from December 31, 2022, to September 30, 2023, primarily due to a significant reduction in cash and cash equivalents, partially offset by an increase in marketable securities[12] - Total liabilities decreased by $13.4 million, largely driven by the repayment of long-term debt[12] Condensed Consolidated Statements of Operations This section details the company's revenues, expenses, and net loss over specific three and nine-month periods | Metric (in thousands) | 3 Months Ended Sep 30, 2023 | 3 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2022 | | :-------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Total Revenue | $14,297 | $15,797 | $35,878 | $35,209 | | Gross Profit | $7,869 | $9,338 | $18,047 | $20,101 | | Loss from Operations | $(9,089) | $(7,154) | $(33,045) | $(25,044) | | Net Loss | $(7,093) | $(6,259) | $(28,970) | $(23,772) | | Net Loss per Share (Basic & Diluted) | $(0.22) | $(0.20) | $(0.90) | $(0.76) | - Total revenue for the three months ended September 30, 2023, decreased by $1.5 million (9.5%) compared to the same period in 2022, primarily due to a decrease in product and contract revenue[14] - Net loss increased for both the three-month and nine-month periods, reaching $(7.093) million and $(28.970) million, respectively, driven by higher operating expenses and, for the nine-month period, increased cost of revenue[14] Condensed Consolidated Statements of Comprehensive Loss This section presents the total comprehensive loss, including net loss and other comprehensive income or loss items | Metric (in thousands) | 3 Months Ended Sep 30, 2023 | 3 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2022 | | :-------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net Loss | $(7,093) | $(6,259) | $(28,970) | $(23,772) | | Foreign currency translation adjustment | $(404) | $(613) | $(170) | $(613) | | Unrealized gains on marketable securities, net of tax of $0 | $248 | — | $360 | — | | Total other comprehensive (loss) income | $(156) | $(613) | $190 | $(613) | | Comprehensive Loss | $(7,249) | $(6,872) | $(28,780) | $(24,385) | - Comprehensive loss for the three months ended September 30, 2023, was $(7.249) million, an increase from $(6.872) million in the prior year, primarily due to the higher net loss[16] - Unrealized gains on marketable securities contributed positively to other comprehensive income in 2023, whereas no such gains were recorded in 2022[16] Condensed Consolidated Statements of Stockholders' Equity This section outlines changes in the company's equity, including common stock, additional paid-in capital, and accumulated deficit | Metric (in thousands) | Sep 30, 2023 | Dec 31, 2022 | | :-------------------- | :----------- | :----------- | | Total Stockholders' Equity | $169,929 | $190,599 | | Common Stock Shares Outstanding | 32,371,428 | 31,859,847 | | Additional Paid-in Capital | $332,080 | $323,969 | | Accumulated Deficit | $(163,171) | $(134,200) | - Total stockholders' equity decreased by $20.67 million from December 31, 2022, to September 30, 2023, primarily due to the accumulated net loss[18] - Additional paid-in capital increased by $8.11 million, reflecting stock-based compensation expense and proceeds from stock option exercises and ESPP purchases[18] Condensed Consolidated Statements of Cash Flows This section details the cash inflows and outflows from operating, investing, and financing activities | Metric (in thousands) | 9 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2022 | | :-------------------- | :-------------------------- | :-------------------------- | | Net Cash Used in Operating Activities | $(23,129) | $(15,814) | | Net Cash Used in Investing Activities | $(31,036) | $(15,195) | | Net Cash (Used in) Provided by Financing Activities | $(16,030) | $768 | | Net Decrease in Cash, Cash Equivalents and Restricted Cash | $(70,209) | $(30,264) | - Net cash used in operating activities increased to $(23.1) million for the nine months ended September 30, 2023, from $(15.8) million in the prior year, driven by a higher net loss and changes in operating assets and liabilities[20][243][244] - Net cash used in investing activities significantly increased to $(31.0) million, primarily due to purchases of marketable securities, compared to $(15.2) million in the prior year which included an acquisition[20][245][246] - Financing activities shifted from providing $0.8 million in cash in 2022 to using $(16.0) million in 2023, mainly due to the repayment of the 2022 Revolver and contingent consideration payments[20][247][248] Notes to Unaudited Condensed Consolidated Financial Statements This section provides detailed explanations of the company's accounting policies and specific financial line items 1. Nature of the Business and Basis of Presentation This note describes the company's core business, recent acquisition, and ongoing financial performance challenges - 908 Devices Inc. is a commercial-stage technology company providing handheld and desktop devices for chemical and biochemical analysis in life sciences, bioprocessing, pharma/biopharma, and forensics markets[21] - The company acquired TRACE Analytics GmbH (now 908 Devices GmbH) in August 2022 to integrate enabling sampling technology into future product offerings[23] - The company has incurred recurring losses since inception, with a net loss of $29.0 million for the nine months ended September 30, 2023, and an accumulated deficit of $163.2 million[26] 2. Summary of Significant Accounting Policies This note outlines key accounting principles, including revenue recognition and concentration risks - The financial statements are prepared in conformity with GAAP and condensed for interim reporting, requiring estimates and assumptions, particularly for revenue recognition, inventory valuation, and fair value of acquired assets[28][29] - The company faces concentration risk with