Seer(US:SEER)2024-08-09 00:05Financial Data and Key Metrics Changes - Total revenue for Q2 2024 was $3.1 million, a decrease of 23% compared to $4 million in Q2 2023, primarily due to a decrease in related party and grant revenue [22][24] - Gross profit was $1.7 million for Q2 2024, representing a gross margin of 56%, compared to $2.3 million and a gross margin of 57% in Q2 2023 [24] - Net loss for Q2 2024 was $22.9 million, compared to $23.4 million in Q2 2023 [26] Business Line Data and Key Metrics Changes - Product revenue for Q2 2024 was $2.2 million, including $420,000 from related party revenue, consisting of sales of SP-100 instruments and consumable kits [22] - Service revenue was $845,000 in Q2 2024, including $163,000 from related party revenue, primarily related to STAC service projects [23] - Grant and other revenue was $46,000 for Q2 2024, consisting of lease and shipping revenue [24] Market Data and Key Metrics Changes - The company experienced elongated sales cycles due to constrained capital budgets around instrumentation, impacting the purchase of new instrumentation [23][30] - The company opened a STAC lab in Germany in June 2024 to enhance access for European researchers [7][34] Company Strategy and Development Direction - The company is focused on enhancing access to the Proteograph product suite and assisting customers in generating novel data while reducing operating cash burn [4][28] - The company aims to drive evidence and publications, enhance access to the Proteograph, innovate with products, and expand applications [21][28] - The launch of the 2024 Seer Insights grant program aimed to support innovative researchers, resulting in increased awareness and demand for the technology [8][9] Management's Comments on Operating Environment and Future Outlook - Management noted a challenging macro environment for the adoption of novel technology, leading to a slower recovery in the second half of the year than previously anticipated [26][27] - The revised revenue guidance for 2024 is now expected to be in the range of $13 million to $15 million, down from the previous guidance of $16 million to $18 million [27] Other Important Information - The company ended Q2 2024 with approximately $344.6 million in cash, cash equivalents, and investments [26] - The company has seen an increase in the number of publications showcasing the value of its technology, with 10 preprints and 11 peer-reviewed publications to date [10][12] Q&A Session Summary Question: Could you comment on the length of the sales cycle that you saw in the second quarter? - Management indicated that the sales cycle is being pushed out due to constrained capital budgets, reflecting a broader trend in the market [30] Question: What are the key underlying assumptions around the acceleration and the top line in 2H? - Management expressed confidence in the second half ramp due to a strong pipeline and increased interest from publications [32] Question: Could you provide some color around the traction generated by the STAC in Germany? - Management noted that the STAC in Germany became operational in June and is beginning to process customer samples, with expectations for revenue to follow similar lines as the U.S. STAC [34][36] Question: How have recent publications aided in conversations with customers? - Management highlighted that publications demonstrate the differentiated biological insights provided by the Proteograph, leading to increased customer interest and adoption [38][41] Question: Can you discuss the split between pharma and academic customers in your sales funnel? - Management noted a shift in the pipeline, with academic opportunities now comprising about 60% of the pipeline, reflecting increased interest from academic institutions [43]