Quanterix(QTRX) - 2021 Q1 - Quarterly Report

PART I — FINANCIAL INFORMATION Financial Statements The unaudited condensed consolidated financial statements for Q1 2021 reflect significant asset growth to $532.7 million from a public offering, with revenue increasing 73% to $27.2 million and net loss narrowing to $10.1 million Unaudited Condensed Consolidated Balance Sheets As of March 31, 2021, total assets significantly increased to $532.7 million, driven by a rise in cash to $442.7 million from a public offering, while stockholders' equity grew to $471.5 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | March 31, 2021 | December 31, 2020 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $442,672 | $181,584 | | Total current assets | $482,443 | $219,605 | | Total assets | $532,666 | $271,045 | | Liabilities & Equity | | | | Total current liabilities | $36,491 | $39,803 | | Total liabilities | $61,197 | $64,920 | | Total stockholders' equity | $471,469 | $206,125 | | Total liabilities and stockholders' equity | $532,666 | $271,045 | Unaudited Condensed Consolidated Statements of Operations For Q1 2021, total revenue grew 73% to $27.2 million, gross profit more than doubled to $16.3 million, and net loss narrowed to $10.1 million, despite a 41% rise in operating expenses Condensed Consolidated Statements of Operations (in thousands, except per share data) | Metric | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :--- | :--- | :--- | | Total revenue | $27,209 | $15,727 | | Gross profit | $16,349 | $6,813 | | Total operating expenses | $26,138 | $18,541 | | Loss from operations | $(9,789) | $(11,728) | | Net loss | $(10,104) | $(11,610) | | Net loss per share, basic and diluted | $(0.29) | $(0.41) | Unaudited Condensed Consolidated Statements of Cash Flows For Q1 2021, net cash used in operations was $14.1 million, while financing activities provided $273.3 million from a public offering, leading to a $261.7 million net increase in cash Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :--- | :--- | :--- | | Net cash used in operating activities | $(14,089) | $(13,179) | | Net cash provided by (used in) investing activities | $2,435 | $(426) | | Net cash provided by financing activities | $273,313 | $861 | | Net increase (decrease) in cash and cash equivalents | $261,659 | $(12,744) | | Cash, restricted cash, and cash equivalents at end of period | $444,072 | $97,359 | - The company received net proceeds of $269.7 million from the sale of common stock in an underwritten public offering during the quarter[22] Notes to Condensed Consolidated Financial Statements The notes detail the $269.7 million net proceeds from a February 2021 public offering, revenue recognition policies including $2.3 million in RADx grant revenue, and information on debt obligations - In February 2021, the company completed an underwritten public offering of approximately 4.1 million shares of common stock, resulting in net proceeds of $269.7 million[31] Disaggregated Revenue by Type (in thousands) - Q1 2021 | Revenue Type | North America | EMEA | Asia Pacific | Total | | :--- | :--- | :--- | :--- | :--- | | Instruments | $3,756 | $2,833 | $372 | $6,961 | | Consumable and other products | $6,911 | $3,493 | $883 | $11,287 | | Service-type warranties | $971 | $438 | $62 | $1,471 | | Research services | $3,558 | $728 | $12 | $4,298 | - Under the RADx program workplan 2 (WP2) award, the company recognized $2.3 million in grant revenue and incurred $1.8 million in related R&D expense during the three months ended March 31, 2021[74] - As of March 31, 2021, the company had $7.7 million in outstanding long-term debt with Hercules Capital, with principal payments scheduled to begin on July 1, 2021 and conclude on October 1, 2021[110][156][157] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q1 2021 financial performance, highlighting a 73% revenue increase to $27.2 million, improved gross margin to 60%, and a narrowed net loss to $10.1 million, bolstered by a $269.7 million public offering Results of Operations For Q1 2021, total revenue grew 73% to $27.2 million, gross profit increased 140% to $16.3 million, and loss from operations improved to $9.8 million, despite a 41% rise in operating expenses Comparison of Results of Operations (in thousands) | Line Item | Q1 2021 | Q1 2020 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Total revenue | $27,209 | $15,727 | $11,482 | 73% | | Gross profit | $16,349 | $6,813 | $9,536 | 140% | | Research and development | $6,683 | $4,268 | $2,415 | 57% | | Selling, general, and administrative | $19,455 | $14,273 | $5,182 | 36% | | Loss from operations | $(9,789) | $(11,728) | $1,939 | 17% | | Net loss | $(10,104) | $(11,610) | $1,506 | 13% | - The increase in product revenue was primarily due to higher instrument demand and increased consumable sales as customers reopened from COVID-19 related shutdowns[146] - R&D expense increased by 57% mainly due to compensation, development, and materials costs related to the NIH RADx program (WP2)[149] Liquidity and Capital Resources The company's liquidity significantly improved in Q1 2021, with cash reaching $442.7 million due to $269.7 million net proceeds from a public offering, sufficient for at least the next 12 months of operations - In February 2021, the company received approximately $269.7 million in net proceeds from an underwritten public offering of 4,107,142 shares of common stock[155] Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :--- | :--- | :--- | | Net cash used in operating activities | $(14,089) | $(13,179) | | Net cash provided by (used in) investing activities | $2,435 | $(426) | | Net cash provided by financing activities | $273,313 | $861 | - The company believes its current cash, cash equivalents, and expected revenue will be sufficient to meet anticipated operating cash requirements for at least the next 12 months[170] Quantitative and Qualitative Disclosures About Market Risk No material changes were reported to the company's market risk disclosures compared to its 2020 Annual Report on Form 10-K - There were no material changes to the company's market risk disclosures as of March 31, 2021, compared to those in the 2020 Annual Report on Form 10-K[181] Controls and Procedures Management concluded that disclosure controls and procedures were effective as of March 31, 2021, with no material changes to internal control over financial reporting during the quarter - Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2021[182] - No material changes to the company's internal control over financial reporting occurred during the first quarter of 2021[183] PART II — OTHER INFORMATION Legal Proceedings The company is not currently a party to any material legal proceedings - As of the filing date, the company was not involved in any material legal proceedings[185] Risk Factors No material changes were reported to the risk factors previously disclosed in the 2020 Annual Report on Form 10-K - No material changes were reported to the risk factors described in the 2020 Annual Report on Form 10-K[186] Unregistered Sales of Equity Securities and Use of Proceeds On January 20, 2021, the company issued 7,347 shares of common stock from the net, non-cash exercise of 10,000 warrants by a consultant, exempt from registration - On January 20, 2021, 10,000 warrants were exercised on a net, non-cash basis, resulting in the issuance of 7,347 shares of common stock to a consultant[187] Defaults Upon Senior Securities This item is not applicable Mine Safety Disclosures This item is not applicable Other Information This item is not applicable Exhibits This section lists exhibits filed with the Quarterly Report on Form 10-Q, including CEO and CFO certifications and XBRL interactive data files - Exhibits filed include CEO and CFO certifications (31.1, 31.2, 32.1) and XBRL data files (101, 104)[194]