What changed in this filing

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Item 1. Financial Statements

2024-08-08 compared with 2024-05-09 · 279 added, 140 removed, 505 unchanged (45% of the section changed)

3 unchanged sentences

(in thousands, except per share data)

As of March 31, As of December 31,

As of June 30, 2024 As of December 31, 2023

Current assets:

38 unchanged sentences

(in thousands, except per share data)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Cell Engineering revenue (1)

7 unchanged sentences

Cost of Biosecurity service revenue 11,807 16,062 21,009 33,896

Cost of other revenue 1,914 — 1,914 —

Research and development 134,221 144,282 270,678 306,921

General and administrative 66,285 102,341 136,572 213,774

Goodwill impairment 47,858 — 47,858 —

Restructuring charges 17,066 — 17,066 —

Total operating expenses 279,151 264,719 495,097 561,166

5 unchanged sentences

Change in fair value of warrant liabilities 3,233 ( 4,482 ) 4,173 ( 3,278 )

Other income, net 2,015 2,928

Total other income (expense) 12,122 10,858

Other income (expense), net ( 766 ) 3,224 1,249 6,152

Total other income 5,954 10,903 18,076 21,761

Loss before income taxes ( 216,991 ) ( 173,248 ) ( 382,871 ) ( 378,135 )

11 unchanged sentences

Comprehensive loss $ ( 217,353 ) $ ( 173,001 ) $ ( 386,299 ) $ ( 376,952 )

(1) Includes related party revenue of $ 733 and $ 4,703 for the three months ended March 31, 2024 and 2023, respectively.

(1) Includes related party revenue of $ 5,146 and $ 6,507 for the three months ended June 30, 2024 and 2023, respectively, and $ 5,819 and $ 11,212 for the six months ended June 30, 2024 and 2023, respectively.

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

(in thousands)

Three Months Ended March 31, 2023

Three Months Ended June 30, 2024

Amount Additional

2 unchanged sentences

Stockholders’

Balance as of December 31, 2022 1,891,976 $ 190 $ 6,136,378 $ ( 4,397,659 ) $ ( 2,632 ) $ 1,736,277

Balance as of March 31, 2024 2,033,624 $ 202 $ 6,445,058 $ ( 5,456,439 ) $ ( 1,551 ) $ 987,270

Issuance of common stock upon exercise or vesting of equity awards 21,472 2 12 — — 14

Settlement of contingent consideration - restricted stock — — 2,262 — — 2,262

Settlement of contingent consideration 1,972 — 2,570 — — 2,570

Issuance of common stock for asset acquisitions 18,949 2 20,923 — — 20,925

Issuance of common stock in exchange for services 2,720 — 2,500 — — 2,500

Stock-based compensation expense — — 37,146 — — 37,146

1 unchanged sentence

Net loss — — — ( 217,181 ) — ( 217,181 )

Balance as of March 31, 2023 1,933,880 $ 194 $ 6,211,634 $ ( 4,602,628 ) $ ( 1,614 ) $ 1,607,586

Three Months Ended March 31, 2024

Balance as of June 30, 2024 2,078,737 $ 206 $ 6,508,209 $ ( 5,673,620 ) $ ( 1,723 ) $ 833,072

Six Months Ended June 30, 2024

Amount Additional

6 unchanged sentences

Issuance of common stock for asset acquisitions 32,082 3 36,798 — — 36,801

Issuance of common stock in exchange for services 2,720 — 2,500 — — 2,500

Stock-based compensation expense — — 77,928 — — 77,928

1 unchanged sentence

Net loss — — — ( 383,092 ) — ( 383,092 )

Balance as of June 30, 2024 2,078,737 $ 206 $ 6,508,209 $ ( 5,673,620 ) $ ( 1,723 ) $ 833,072

The accompanying notes are an integral part of these condensed consolidated financial statements.

Ginkgo Bioworks Holdings, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(in thousands)

Three Months Ended June 30, 2023

Amount Additional

Accumulated Deficit

Comprehensive

Stockholders’

Balance as of March 31, 2023 1,933,880 $ 194 $ 6,211,634 $ ( 4,602,628 ) $ ( 1,614 ) $ 1,607,586

Issuance of common stock upon exercise or vesting of equity awards 15,995 2 470 — — 472

Tax withholdings related to net share settlement of equity awards ( 14 ) — ( 23 ) — — ( 23 )

Issuance of common stock for asset acquisitions 2,820 — 3,581 — — 3,581

Issuance of common stock in exchange for services 2,023 — 2,500 — — 2,500

Stock-based compensation expense and other — — 62,470 — — 62,470

Foreign currency translation — — — — 314 314

Net loss — — — ( 173,315 ) — ( 173,315 )

Balance as of June 30, 2023 1,954,704 $ 196 $ 6,280,632 $ ( 4,775,943 ) $ ( 1,300 ) $ 1,503,585

Six Months Ended June 30, 2023

Amount Additional

Accumulated Deficit

Comprehensive

Stockholders’

Balance as of December 31, 2022 1,891,976 $ 190 $ 6,136,378 $ ( 4,397,659 ) $ ( 2,632 ) $ 1,736,277

Issuance of common stock upon exercise or vesting of equity awards 57,899 6 478 — — 484

Tax withholdings related to net share settlement of equity awards ( 14 ) — ( 23 ) — — ( 23 )

Settlement of contingent consideration - restricted stock — — 2,262 — — 2,262

Issuance of common stock for asset acquisitions 2,820 — 3,581 — — 3,581

Issuance of common stock in exchange for services 2,023 — 2,500 — — 2,500

Stock-based compensation expense and other — — 135,456 — — 135,456

Foreign currency translation — — — — 1,332 1,332

Net loss — — — ( 378,284 ) — ( 378,284 )

Balance as of June 30, 2023 1,954,704 $ 196 $ 6,280,632 $ ( 4,775,943 ) $ ( 1,300 ) $ 1,503,585

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

(in thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows from operating activities:

3 unchanged sentences

Stock-based compensation 77,928 134,474

Goodwill impairment 47,858 —

Restructuring related impairment charges 4,823 —

Loss on investments and equity method investments 9,370 10,007

3 unchanged sentences

Non-cash in-process research and development 19,795 3,981

Impairment loss on assets held for sale — 9,001

Other non-cash activity 2,097 2,429

Changes in operating assets and liabilities:

Accounts receivable ($ 372 and $( 26 ) from related parties)

( 6,770 ) ( 526 )

Accounts receivable ( 1,102 ) 15,397

Prepaid expenses and other current assets 1,770 12,087

10 unchanged sentences

Business acquisition ( 5,400 ) —

Proceeds from sale of equipment 191 2,926

Other — ( 590 )

Net cash used in investing activities ( 38,951 ) ( 30,638 )

3 unchanged sentences

Contingent consideration payment ( 661 ) ( 1,042 )

Payment of equity issuance costs — ( 578 )

Other — ( 603 )

Net cash used in financing activities ( 1,071 ) ( 2,269 )

34 unchanged sentences

Significant Accounting Policies

There have been no new or material changes to the Company’s significant accounting policies during the three months ended March 31, 2024 as compared to the significant accounting policies described in Note 2 to the Company's 2023 consolidated financial statements included in the Company's 2023 Annual Report on Form 10-K.

Recently Issued Accounting Pronouncements

There were no new recently issued accounting pronouncements that are of significance or potential significance to the Company from those disclosed within Note 2 to the Company's 2023 consolidated financial statements included in the 2023 Annual Report on Form 10-K.

There have been no new or material changes to the Company’s significant accounting policies during the six months ended June 30, 2024 as compared to the significant accounting policies described in Note 2 to the Company's 2023 consolidated financial statements included in the Company's 2023 Annual Report on Form 10-K.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Recently Issued Accounting Pronouncements

On April 10, 2024, the Company acquired certain platform assets, including fully sequenced and isolated strains, unique gene sequences, relevant functional data and metadata, and a development pipeline from AgBiome, Inc.

(“AgBiome”), a biotechnology company in the agriculture industry.

These assets expand the Company’s proprietary unified metagenomics database.

The fair value of the consideration transferred totaled $ 18.2 million and was paid with the issuance of 16.3 million shares of Ginkgo's Class A common stock.

The Company accounted for the transaction as an asset acquisition since substantially all of the value received was concentrated in the acquired developed technology, which is being amortized over a useful life of three years .

On October 3, 2023, and in connection with the Zymergen Bankruptcy, as defined and discussed in the Company’s 2023 Annual Report on Form 10-K, the Company entered into an asset purchase agreement with Zymergen (the “Zymergen APA”) as the stalking horse bidder under Section 363 of the U.S.

6 unchanged sentences

No goodwill or intangible assets were recognized.

Transaction costs associated with the Zymergen APA were not material for the three months ended March 31, 2024.

In the three months ended March 31, 2024, the Company issued 13.1 million shares of Class A common stock to acquire certain assets, which did not meet the definition of a business for accounting purposes.

The assets acquired consisted of intellectual property with an aggregate estimated fair value of $ 16.9 million, all of which was expensed as in-process research and development in the accompanying condensed consolidated statements of operations and comprehensive loss during the period, as the assets did not have an alternative use.

Transaction costs associated with the Zymergen APA were not material for the six months ended June 30, 2024.

Other Acquisitions

The Company completed three other asset acquisitions during the six months ended June 30, 2024.

The aggregate purchase price for the three acquisitions was $ 19.8 million and was paid with the issuance of 15.8 million shares of Ginkgo's Class A common stock.

Each transaction was accounted for as an asset acquisition as the acquired assets, consisting primarily of intellectual property rights, did not meet the definition of a business.

The assets acquired represent in-process research and development with no alternative future use.

Accordingly, the Company recorded $ 3.0 million and $ 19.8 million as acquired in-process research and development expense in the accompanying condensed consolidated statements of operations and comprehensive loss for the three and six months ended June 30, 2024, respectively.

Restructuring

In the three months ended June 30, 2024, in connection with the Company’s plans to reduce operational expenditures, management, with the approval of the Board of Directors, approved a restructuring plan.

This plan includes an expected reduction in labor expenses, primarily through a workforce reduction of at least 35 %, and a planned consolidation and sublease of certain facilities.

Initial workforce reductions commenced in June 2024, with further reductions expected in the second half of 2024.

All reductions are expected to be substantially completed in 2025, subject to compliance with

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

applicable laws.

The Company plans to consolidate certain facilities through various actions, including the consolidation of office and laboratory operations into fewer locations, subleasing unused facilities, and other related measures.

While the Company aims to complete the majority of its facility consolidation actions in 2025, the actual timing may vary.

The costs for the reduction in force are expected to range from $ 18.0 million to $ 22.0 million primarily in the Cell Engineering segment and consist of one-time cash severance and related costs.

The employee termination costs are recognized as of the communication date to employees, given (i) the Company instituted a one-time employee termination benefit related to its restructuring, and (ii) the employees will not be retained to render service beyond a minimum retention period.

The Company is currently unable to estimate the costs associated with consolidating its facilities.

These costs may include, but are not limited to, losses on subleases, contract terminations, asset impairments, sale or disposal of equipment or other long-lived assets, and related costs and fees pertaining to the consolidation, closure, or disposition of facilities.

Additional charges may be incurred as the Company progresses its restructuring plan and such charges could be material.

During the three and six months ended June 30, 2024, the Company incurred $ 17.1 million in restructuring costs, which are recorded as “Restructuring charges” in the condensed consolidated statements of operations and comprehensive loss.

The following table presents details of expenses incurred including a summary of the changes in the accrued liability balance related to the restructuring activities, which is included in “Accounts payable” and “Accrued expenses and other current liabilities” in the accompanying condensed consolidated balance sheet as of June 30, 2024 (in thousands):

Employee Termination Costs and Other Impairment of Right-of-Use Asset (1)

Expenses incurred $ 12,243 $ 4,823 $ 17,066

Cash payments ( 489 )

Liability balance at June 30, 2024 $ 11,754

(1) Relates to a decision to sublease a certain facility in connection with the restructuring and reflects the excess of the right-of-use asset's carrying value over its fair value, which was determined based on estimates of future discounted cash flows and is classified as Level 3 in the fair value hierarchy.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Fair Value Measurements

The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis (in thousands):

As of March 31, 2024

As of June 30, 2024

Classification Total Level 1 Level 2 Level 3

3 unchanged sentences

Marketable equity securities Investments 20,332 20,332 — —

Notes receivable Prepaid expenses and other assets 12,795 — — 12,795

Notes receivable Prepaid expenses and other current assets 10,937 — — 10,937

Notes receivable Other non-current assets 14,776 — 12,498 2,278

6 unchanged sentences

Total liabilities $ 22,722 $ 1,035 $ 120 $ 21,567

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

As of December 31, 2023

5 unchanged sentences

Investments 19,190 18,401 789 —

Notes receivable Prepaid expenses and other 12,293 — — 12,293

Notes receivable Prepaid expenses and other current assets 12,293 — — 12,293

Notes receivable Other non-current assets 13,601 — 11,765 1,836

10 unchanged sentences

(3) The fair value of Private Placement Warrants classified as Level 2 is equivalent to that of Public Warrants as the transfer of Private Placement Warrants to anyone other than the initial purchasers or any of their permitted transferees results in the Private Placement Warrants having substantially the same terms as the Public Warrants.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Transfers to and from Levels 1, 2 and 3 are recognized at the end of the reporting period in which a change in valuation technique or methodology occurs.

During the three months ended March 31, 2024, transfers from Level 2 to Level 1 occurred due to lapse of regulatory sales restrictions on marketable equity securities.

Additionally, as of March 31, 2024, a portion of the Private Placement Warrants' estimated fair value was transferred from Level 3 to Level 2 as a result of the Private Placement Warrants having substantially the same terms as the Public Warrants when transferred to anyone other than the initial purchasers or their permitted transferees, leading the Company to determine their fair value to be equivalent to that of the Public Warrants.

There were no other transfers between Levels 1, 2, or 3 during the three months ended March 31, 2024 or 2023.

During the six months ended June 30, 2024, transfers from Level 2 to Level 1 occurred due to lapse of regulatory sales restrictions on marketable equity securities.

Additionally, as of June 30, 2024, a portion of the Private Placement Warrants' estimated fair value was transferred from Level 3 to Level 2 as a result of the Private Placement Warrants having substantially the same terms as the Public Warrants when transferred to anyone other than the initial purchasers or their permitted transferees, leading the Company to determine their fair value to be equivalent to that of the Public Warrants.

There were no other transfers between Levels 1, 2, or 3 during the six months ended June 30, 2024 or 2023.

Notes Receivable

For all of its notes receivable, the Company has elected the fair value option, for which changes in fair value are recorded in other income, net in the condensed consolidated statements of operations and comprehensive loss.

As of March 31, 2024 and December 31, 2023, the Company held a senior secured note in the principal amount of $ 11.8 million and a convertible promissory note in the principal amount of $ 10.0 million, both issued by Bolt Threads, Inc.

For all of its notes receivable, the Company has elected the fair value option, for which changes in fair value are recorded in other income (expense), net in the condensed consolidated statements of operations and comprehensive loss.

As of June 30, 2024 and December 31, 2023, the Company held a senior secured note in the principal amount of $ 11.8 million and a convertible promissory note in the principal amount of $ 10.0 million, both issued by Bolt Threads, Inc.

(“Bolt Threads”).

The senior secured note bears interest at 12 % per annum, is due December 31, 2027 and is included in other non-current assets at its estimated fair value.

The convertible promissory note bears interest at 8 % per annum, is convertible into equity securities of Bolt Threads upon a qualified financing, a non-qualified financing, or special purpose acquisition company transaction, at a conversion price equal to 80 % of the price paid per share under the conversion scenario, or is otherwise payable on demand any time after the maturity date of October 4, 2024.

The convertible promissory note bears interest at 8 % per annum, is convertible into equity securities of Bolt Threads upon a qualified financing, a non-qualified financing, or special purpose acquisition company transaction, at a conversion price based on certain conditions as defined in the note agreement, or is otherwise payable on demand any time after the maturity date of October 4, 2024.

The convertible promissory note is included in prepaid expenses and other current assets at its estimated fair value.

2 unchanged sentences

Increases or decreases in the market yield or discount rate would result in a decrease or increase, respectively, in the fair value measurement.

The market yield is determined using a corporate bond yield curve corresponding to the credit

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

rating category of the issuer.

The market yield is determined using a corporate bond yield curve corresponding to the credit rating category of the issuer.

The fair value of the senior secured note is based on observable market inputs, which represents a Level 2 measurement within the fair value hierarchy.

In addition to the convertible promissory note issued by Bolt Threads, the Company holds a series of convertible debt instruments issued by customers as payment for Cell Engineering services.

The Company used a scenario-based method to value the convertible debt instruments issued by customers and by Bolt Threads.

The Company used a scenario-based method to value the convertible debt instruments issued by customers.

Under this method, future cash flows are evaluated under various payoff scenarios, probability-weighted, and discounted to present value.

The significant unobservable (Level 3) inputs used in the fair value measurement as of March 31, 2024 were scenario probabilities of between 5 % and 85 %, a discount rate of 17 % and estimated time to event date of up to two years .

The significant unobservable (Level 3) inputs used in the fair value measurement as of December 31, 2023 were scenario probabilities of between 5 % and 85 %, a discount rate of 17 % and estimated time to event date of one to two years .

The significant unobservable (Level 3) inputs used in the fair value measurement as of June 30, 2024, included scenario probabilities ranging from 20 % to 27 %, a discount rate of 15 %, and estimated time to event date of up to 2 years.

The significant unobservable (Level 3) inputs used in the fair value measurement as of December 31, 2023, included scenario probabilities ranging from 5 % to 85 %, a discount rate of 17 % and estimated time to event date of one to two years .

Significant changes in these inputs could have resulted in a significantly lower or higher fair value measurement.

As of March 31, 2024, the convertible debt instruments had an unpaid principal balance of $ 21.9 million and a fair value of $ 15.1 million.

As of June 30, 2024, the convertible debt instruments had an unpaid principal balance of $ 22.7 million and a fair value of $ 13.2 million.

As of December 31, 2023, the convertible debt instruments had an unpaid principal balance of $ 21.0 million and a fair value of $ 14.1 million.

The following table provides a reconciliation of notes receivable measured at fair value using Level 3 significant unobservable inputs for the three months ended March 31 (in thousands):

The following table provides a reconciliation of notes receivable measured at fair value using Level 3 significant unobservable inputs for the six months ended June 30 (in thousands):

Balance at January 1, $ 14,129 $ 7,660

1 unchanged sentence

Change in fair value ( 1,579 ) ( 1,489 )

Balance at March 31, $ 15,140 $ 8,093

Balance at June 30, $ 13,215 $ 9,308

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Warrant Liabilities

10 unchanged sentences

The following table provides quantitative information regarding Level 3 inputs used in the recurring valuation of the Private Placement Warrants as of their measurement dates:

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Exercise price $ 11.50 $ 11.50

3 unchanged sentences

Risk-free interest rate 4.70 % 4.01 %

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

The following table provides a reconciliation of the Private Placement Warrants measured at fair value using Level 3 significant unobservable inputs for the three months ended March 31 (in thousands):

The following table provides a reconciliation of the Private Placement Warrants measured at fair value using Level 3 significant unobservable inputs for the six months ended June 30 (in thousands):

Balance at January 1, $ 1,846 $ 3,860

Change in fair value ( 1,324 ) 1,175

Balance at March 31, $ 1,537 $ 3,357

Transfers to Level 2 ( 149 ) —

Balance at June 30, $ 373 $ 5,035

Contingent Consideration

2 unchanged sentences

The Company can settle a majority of its contingent consideration liabilities in cash or shares of Class A common stock at the Company’s election with the remainder payable in cash.

During the three months ended March 31, 2024, the Company settled $ 2.8 million in contingent consideration liabilities through payment of $ 0.9 million in cash and vesting of 1.2 million shares of restricted stock valued at $ 1.9 million.

During the three months ended March 31, 2023, the Company settled $ 2.3 million in contingent consideration liability related to restricted stock that was contingent on the filing of a registration statement to register the shares issued as purchase consideration for acquisitions.

Of that amount, $ 1.4 million was recorded as an increase to the acquired intangible asset with an offset to additional paid-in-capital as the contingent consideration liability was deemed not probable until the filing of the registration statement.

During the six months ended June 30, 2024, the Company settled $ 5.4 million in contingent consideration liabilities through payment of $ 0.9 million in cash and vesting of 3.9 million shares of restricted stock valued at $ 4.4 million.

During the six months ended June 30, 2023, the Company settled $ 3.8 million in contingent consideration liability through payment of $ 1.5 million in cash and vesting of 1.2 million shares of restricted stock valued at $ 2.3 million.

The fair value of contingent consideration related to earnout payments from acquisitions was estimated using unobservable (Level 3) inputs as illustrated in the table below.

The fair value of contingent consideration related to restricted stock was estimated using the quoted price of Ginkgo's Class A common stock, an estimate of the number of shares expected to vest, probability of vesting, and a discount rate.

The fair value of contingent consideration related to restricted stock was

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

estimated using the quoted price of Ginkgo's Class A common stock, an estimate of the number of shares expected to vest, probability of vesting, and a discount rate.

Material increases or decreases in these inputs could result in a higher or lower fair value measurement.

1 unchanged sentence

The following table provides quantitative information regarding Level 3 inputs used in the fair value measurements of contingent consideration liabilities as of the periods presented:

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Contingent Consideration Liability Valuation Technique Unobservable Input Range Range

7 unchanged sentences

Settlements and payments ( 5,363 ) ( 2,364 )

Balance at March 31, $ 20,594 $ 28,786

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Balance at June 30, $ 21,194 $ 30,562

Nonrecurring Fair Value Measurements

2 unchanged sentences

The fair value of non-marketable equity securities is classified within Level 2 in the fair value hierarchy when the Company estimates fair value using the observable transaction price paid by third party investors for the identical or similar security of the same issuer.

During the three months ended March 31, 2023, the Company received a total purchase amount of $ 11.0 million in Simple Agreement for Future Equity (“SAFEs”) from customers as prepayment for Cell Engineering services.

During the three months ended June 30, 2024, the Company recorded a $ 4.9 million impairment loss related to its investment in Genomatica preferred stock.

The fair value measurement was determined using the guideline public company method under the market approach.

The significant unobservable inputs used in the valuation included the selection and analysis of guideline public companies, revenue multiple and other unobservable assumptions.

The fair value measurement is classified as Level 3 in the fair value hierarchy.

During the six months ended June 30, 2023, the Company received a total purchase amount of $ 11.0 million in Simple Agreement for Future Equity (“SAFEs”) from customers as prepayment for Cell Engineering services.

The Company used a scenario-based method to value the SAFEs as of each contract inception date, which resulted in total fair value of $ 4.5 million.

2 unchanged sentences

The significant unobservable (Level 3) inputs used in the fair value measurement were scenario probabilities of 20 % to 60 %, a discount rate of 14 % and estimated time to event date of one to two years .

During the three months ended March 31, 2024 and 2023, the Company recorded impairment losses of $ 5.2 million and $ 1.8 million, respectively, related to SAFEs.

The fair value was generally estimated using the scenario-based method, whereby various payout scenarios were probability weighted and discounted to present value.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

The Company recorded impairment losses of zero and $ 1.8 million related to SAFEs during the three months ended June 30, 2024 and 2023, respectively, and $ 5.2 million and $ 1.8 million during the six months ended June 30, 2024 and 2023, respectively.

The fair value was generally estimated using the scenario-based method, where various payout scenarios were probability-weighted and discounted to present value.

Investments and Equity Method Investments

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The Company initially records SAFEs at fair value (see Note 4 ) and adjusts the carrying amount of the instrument at each reporting period for any impairments.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Investments consisted of the following (in thousands):

As of March 31, As of December 31,

As of June 30, 2024 As of December 31, 2023

SAFEs $ 18,686 $ 23,898

5 unchanged sentences

Total $ 62,490 $ 78,565

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Loss on investments and equity method investments consisted of the following (in thousands):

Three Months Ended March 31,

Gain (loss) on investments:

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

(Loss) gain on investments:

Synlogic common stock $ ( 123 ) $ ( 1,281 ) $ ( 993 ) $ ( 2,092 )

Synlogic warrants ( 49 ) ( 514 ) ( 399 ) ( 841 )

Genomatica preferred stock ( 4,900 ) — ( 4,900 ) —

Marketable equity securities ( 1,754 ) ( 326 ) 2,134 ( 3,747 )

1 unchanged sentence

Total $ ( 6,826 ) $ ( 2,121 ) $ ( 9,370 ) $ ( 8,491 )

Gain (loss) on equity method investments:

Loss on equity method investments:

BiomEdit $ — $ — $ — $ ( 1,462 )

Other — ( 67 ) — ( 54 )

Total $ — $ ( 67 ) $ — $ ( 1,516 )

The components of loss on investments for each period were as follows (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Impairment charges $ ( 4,900 ) $ — $ ( 10,112 ) $ ( 1,811 )

1 unchanged sentence

Total loss on investments $ ( 6,826 ) $ ( 2,121 ) $ ( 9,370 ) $ ( 8,491 )

The carrying value for non-marketable equity securities accounted for using the fair value measurement alternative and held as of March 31, 2024, including cumulative unrealized losses, were as follows (in thousands):

As of March 31, 2024

The carrying value for non-marketable equity securities accounted for using the fair value measurement alternative and held as of June 30, 2024, including cumulative unrealized losses, were as follows (in thousands):

As of June 30, 2024

Total initial cost $ 107,996

2 unchanged sentences

Carrying value $ 41,903

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Variable Interest Entities

3 unchanged sentences

As the Company’s involvement in the Unconsolidated VIEs does not give it the power to control the decisions with respect to their development or other activities, which are their most significant activities, the Company has concluded that it is not the primary beneficiary of the Unconsolidated VIEs.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Additionally, the Company holds equity interests in certain privately-held companies that are not consolidated as the Company is not the primary beneficiary.

As of March 31, 2024 and December 31, 2023, the maximum risk of loss related to the Company’s VIEs was limited to the carrying value of its investments in such entities.

As of June 30, 2024 and December 31, 2023, the maximum risk of loss related to the Company’s VIEs was limited to the carrying value of its investments in such entities.

Refer to Note 5 for additional details on the Company’s investments and equity method investments.

2 unchanged sentences

The reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheet to the totals shown within the condensed consolidated statement of cash flows is as follows (in thousands):

As of March 31,

As of June 30, 2024 As of June 30, 2023

Cash and cash equivalents $ 730,367 $ 1,105,787

4 unchanged sentences

(1) Includes cash balances collateralizing letters of credit associated with the Company’s facility leases and customer prepayments requiring segregation and restrictions in its use in accordance with the customer agreement.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Supplemental cash flow information

The following table presents non-cash investing and financing activities (in thousands):

Three Months Ended March 31,

Six Months Ended June 30,

Supplemental disclosure of non-cash investing and financing activities:

Right-of-use assets obtained in exchange for new operating lease liabilities $ 223,853 $ 13,649

Common stock issued for asset acquisitions 18,245 3,581

Purchases of property and equipment included in accounts payable and accrued expenses 7,936 2,324

Convertible financial instruments received for Cell Engineering services — 4,478

Equity securities and warrants received for Cell Engineering services — 12,493

Return of investment in equity securities for reduction in deferred revenue 6,760 —

Common stock issued as settlement of contingent consideration liability 4,447 2,262

Common stock issued for retention payments related to business and asset acquisitions 2,959 2,500

Equity securities received for Cell Engineering services 55 12,493

Convertible financial instruments received for Cell Engineering services — 5,595

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Property, Plant, and Equipment, net

Property, plant, and equipment, net consisted of the following (in thousands):

As of March 31, As of December 31,

June 30, 2024 December 31, 2023

Lab equipment $ 147,487 $ 147,185

8 unchanged sentences

Property, plant, and equipment, net $ 210,582 $ 188,193

Operating Lease

In April 2024, the Company commenced its 15-year lease of a new office and laboratory space located in Boston, Massachusetts.

The leased property consists of approximately 260,000 rentable square feet and is expected to be occupied by mid-2025.

The lease agreement includes an option to extend the lease for ten years at then-market rates.

The Company is not reasonably certain to exercise this option at lease commencement.

The lease is classified as an operating lease, includes a period of free rent and also tenant improvement incentives.

The lease does not contain material restrictive covenants or residual value guarantees.

Upon the lease commencement, the Company recorded a right-of-use asset of $ 213.3 million, net of lease incentives received, and a lease liability of $ 223.9 million.

The discount rate used in determining the lease liability was the Company's estimated incremental borrowing rate of 7.8 %.

Base rent during the first lease year is approximately $ 21.1 million and is subject to annual increases of 3 % thereafter.

Capitalization

1 unchanged sentence

Authorized Issued Outstanding

Common stock as of March 31, 2024:

Common stock as of June 30, 2024:

Class A 10,500,000 1,723,919 1,603,066

11 unchanged sentences

All goodwill is allocated to the Cell Engineering reporting unit and segment identified in Note 12 .

During the three months ended June 30, 2024, due to a sustained decrease in the market price of the Company's Class A common stock and market capitalization, the Company identified that an indicator of impairment was present as of June 30, 2024.

As such, the Company completed a quantitative impairment test related to its Cell Engineering reporting unit.

To conduct the impairment test of goodwill, the estimated fair value of the reporting unit was compared to its carrying value.

The estimated fair value of the reporting unit was determined using a weighted approach that considered a discounted cash flow (“DCF”) model under the income approach and the guideline public company (“GPC”) method under the market approach.

Significant inputs used in the DCF model included the projected future operating results of the reporting unit and the applicable discount rate, while inputs used in the GPC method consisted of a revenue multiple.

The fair value measurement of the reporting unit is classified as Level 3 in the fair value hierarchy because it involves significant unobservable inputs.

The Company reconciled the resulting fair value of its reporting unit to the market capitalization of the Company to corroborate the fair value estimate used in the impairment test.

The result of the interim impairment test indicated that the estimated fair value of the reporting unit was less than its carrying value.

As a result, the Company recorded a $ 47.9 million goodwill impairment charge during the three and six months ended June 30, 2024.

Changes in the carrying amount of goodwill consisted of the following (in thousands):

Balance as of December 31, 2023 $ 49,238

Goodwill impairment (accumulated impairment loss) ( 47,858 )

Impact of foreign currency translation ( 1,380 )

Balance as of March 31, 2024 $ 47,909

Balance as of June 30, 2024 $ —

Intangible assets, net consisted of the following (in thousands):

2 unchanged sentences

Amortization Period

March 31, 2024:

June 30, 2024:

Developed technology $ 121,206 $ ( 30,628 ) $ 90,578 7.4

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Total intangible assets $ 105,849 $ ( 23,108 ) $ 82,741

(1) Gross carrying value and accumulated amortization include the impact of cumulative foreign currency translation adjustments.

Amortization expense was $ 3.4 million and $ 4.3 million for the three months ended March 31, 2024 and 2023, respectively.

As of March 31, 2024, estimated future amortization expense for identifiable intangible assets is as follows (in thousands):

(1) The gross carrying value and accumulated amortization balances include the impact of cumulative foreign currency translation adjustments.

During the three months ended June 30, 2024, in connection with the acquisition of AgBiome, the Company acquired developed technology with an aggregate fair value of $ 18.2 million and an estimated useful life of three years .

For further information, see Note 2 .

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Amortization expense was $ 4.9 million and $ 4.0 million for the three months ended June 30, 2024 and 2023, respectively, and $ 8.4 million and $ 8.3 million for the six months ended June 30, 2024 and 2023, respectively.

As of June 30, 2024, estimated future amortization expense for identifiable intangible assets is as follows (in thousands):

Remainder of 2024 $ 9,798

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The Company does not believe any pending litigation to be material, or that the outcome of any such pending litigation, in management’s judgment based on information currently available, would have a material adverse effect on the Company’s results of operations, cash flows or financial condition.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Stock-Based Compensation

The following table summarizes stock-based compensation expense by financial statement line item in the Company’s condensed consolidated statement of operations and comprehensive loss for the periods presented (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Research and development $ 20,066 $ 39,927 $ 43,258 $ 86,427

2 unchanged sentences

The Company grants stock-based incentive awards pursuant to the 2021 Incentive Award Plan (the “2021 Plan”) and the 2022 Inducement Plan (the “2022 Inducement Plan”).

As of March 31, 2024, there were approximately 173.2 million shares and 3.1 million shares available for future issuance under the 2021 Plan and 2022 Inducement Plan, respectively.

Stock Options

A summary of stock option activity for the three months ended March 31, 2024 is presented below:

As of June 30, 2024, there were approximately 147.1 million shares and 3.1 million shares available for future issuance under the 2021 Plan and 2022 Inducement Plan, respectively.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Time-based Stock Options

A summary of stock option activity for options that are subject to time-based vesting conditions for the six months ended June 30, 2024, is presented below:

(in thousands)

1 unchanged sentence

Outstanding as of December 31, 2023 6,049 $ 0.89

Granted 6,222 0.46

Exercised ( 4,078 ) 0.02

Outstanding as of March 31, 2024 2,644 2.01 6.55 $ 768

Exercisable as of March 31, 2024 1,523 1.89 4.68 768

(1) Excludes 1.5 million shares underlying options issued outside the accounting for compensation awards under ASC 718.

Forfeited ( 17 ) 11.42

Outstanding as of June 30, 2024 8,176 0.98 9.05 $ —

Exercisable as of June 30, 2024 1,829 2.59 6.03 —

(1) The aggregate intrinsic value is calculated as the difference between the Company's closing stock price on the last trading day of the quarter and the exercise prices, multiplied by the number of in-the-money stock options.

The aggregate intrinsic value of stock options exercised during the three months ended March 31, 2024 and 2023 was $ 3.9 million and $ 1.5 million, respectively.

As of March 31, 2024, there was $ 0.5 million of unrecognized compensation expense related to stock options recognizable over a weighted-average period of 0.7 years.

The aggregate intrinsic value of options exercised during the six months ended June 30, 2024 and 2023 was $ 1.3 million and $ 2.9 million, respectively.

The weighted-average grant-date fair value of options granted during the six months ended June 30, 2024 and 2023 was $ 0.35 and $ 1.43 per share, respectively, and was calculated using the following key assumptions in the Black-Scholes option-pricing model:

Six Months Ended June 30,

Risk-free interest rate 4.24 % 3.94 %

Expected volatility 96 % 93 %

Expected term (in years) 5.7 5.5

Dividend yield — % — %

As of June 30, 2024, there was $ 2.3 million of unrecognized compensation expense related to time-based stock options recognizable over a weighted-average period of 1.7 years.

Market-based Stock Options

In April 2024, the Company granted to each of the Company's four founders an option to purchase in aggregate 5.0 million shares of Ginkgo's Class A common stock with an exercise price of $ 2.50 per share, subject both to time-based and market-based vesting criteria (the “Founder Options”).

The market-based vesting is tied to the achievement of four specified stock price hurdles within a five-year period, with 10 % of the Founder Options vesting based on the achievement of a 90-calendar-day average stock price of $ 5.00 , 10 % of the Founder Options vesting based on the achievement of a 90-calendar-day average stock price of $ 7.50 , 20 % of the Founder Options vesting based on the achievement of a 90-calendar-day average stock price of $ 10.00 and the remaining 60 % of the Founder Options vesting based on the achievement of a 90-

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

calendar-day average stock price of $ 12.50 .

If the market-based criteria are achieved during the five-year period, the awards will vest on the five-year anniversary of the grant date.

The weighted-average grant-date fair value of the options granted was $0 .20 per share and was calculated using a Monte Carlo simulation model with the following assumptions:

Six Months Ended June 30, 2024

Risk-free interest rate 4.65 %

Expected volatility 71.8 %

Suboptimal exercise multiple 2.8

Dividend yield — %

As of June 30, 2024, there was $ 3.8 million of unrecognized compensation expense related to the market-based stock options recognizable over a weighted-average period of 4.8 years.

Restricted Stock Units

A summary of the restricted stock units (“RSU”) activity for the three months ended March 31, 2024 is presented below:

A summary of the restricted stock units (“RSU”) activity for the six months ended June 30, 2024 is presented below:

(in thousands) Weighted

3 unchanged sentences

Forfeited ( 8,605 ) 2.33

Nonvested as of March 31, 2024 238,705 2.24

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

The weighted average grant date fair value of RSUs granted during the three months ended March 31, 2024 and 2023 was $ 1.21 and $ 1.32 , respectively.

As of March 31, 2024, there was $ 395.8 million of unrecognized compensation expense related to RSUs recognizable over a weighted-average period of 3.2 years.

Nonvested as of June 30, 2024 219,177 2.07

The weighted average grant date fair value of RSUs granted during the six months ended June 30, 2024 and 2023 was $ 1.18 and $ 1.32 , respectively.

As of June 30, 2024, there was $ 360.8 million of unrecognized compensation expense related to RSUs recognizable over a weighted-average period of 2.9 years.

Earnout shares represent equity awards in the form of RSUs and restricted stock awards (“RSAs”) that were granted to existing shareholders of the Company as of the closing date of the Company's merger with SRNG on September 16, 2021 (the “Closing Date”).

The earnout shares are subject to the same terms and conditions as the underlying awards (including with respect to vesting and termination-related provisions).

The earnout shares are subject to the same time vesting and performance conditions (change in control or an initial public offering) as the underlying awards (including with respect to vesting and termination-related provisions).

Additionally, the earnout shares are subject to a market condition that will be met when the trading price of the Company's common stock is greater than or equal to $ 12.50 , $ 15.00 , $ 17.50 and $ 20.00 for any 20 trading days within any period of 30 consecutive trading days, on or before the fifth anniversary of the Closing Date (collectively, the “Earnout Targets”).

The first Earnout Target of $ 12.50 per share was met on November 15, 2021.

A summary of activity during the three months ended March 31, 2024 for the earnout shares is presented below:

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

A summary of activity during the six months ended June 30, 2024 for the earnout shares is presented below:

(in thousands)

2 unchanged sentences

Forfeited ( 43 ) 12.92

Nonvested as of March 31, 2024 22,504 12.78

As of March 31, 2024, there was $ 2.5 million of unrecognized compensation expense related to earnout shares recognizable over a weighted-average period of 1.1 years.

Nonvested as of June 30, 2024 22,390 12.77

As of June 30, 2024, there was $ 2.3 million of unrecognized compensation expense related to earnout shares recognizable over a weighted-average period of 0.8 years.

Revenue Recognition

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The following table sets forth the percentage of Cell Engineering revenues by industry based on total Cell Engineering revenue:

Three Months Ended March 31,

Pharma and biotech 28 % 30 %

Agriculture 28 27

Food and nutrition 17 16

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Government and defense 25 % 4 % 21 % 5 %

Industrial and environment 10 12

Agriculture 23 20 25 23

Pharma and biotech 22 40 25 35

Consumer and technology 15 14 9 12

Industrial and environment 11 11 10 12

Food and nutrition 4 11 10 13

Total Cell Engineering revenue 100 % 100 % 100 % 100 %

For the three months ended March 31, 2024 and 2023, the Company’s revenue from customers within the United States comprised 70 % and 84 %, respectively, of total revenue.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

For both the three months ended June 30, 2024 and 2023, the Company’s revenue from customers within the United States comprised 84 % of total revenue.

For the six months ended June 30, 2024 and 2023, the Company's revenue from customers within the United States comprised 79 % and 84 %, respectively, of total revenue.

Contract Balances

The Company recognizes a contract asset when the Company transfers goods or services to a customer before the customer pays consideration or before payment is due, excluding any amounts presented as accounts receivable.

The Company had no contract asset balances as of March 31, 2024 and December 31, 2023.

The Company had no contract asset balances as of June 30, 2024 and December 31, 2023.

The Company's accounts receivable consists of both billed and unbilled amounts.

Unbilled receivables arise when revenue is recognized in excess of invoiced amounts and represent the Company’s unconditional right to consideration for goods or services already transferred to the customer.

The balance of unbilled accounts receivable, included in accounts receivable, net in the accompanying condensed consolidated balance sheets, was $ 10.8 million and $ 9.1 million as of June 30, 2024 and December 31, 2023, respectively.

Contract liabilities, or deferred revenue, primarily consist of payments received in advance of performance under the contract or when the Company has an unconditional right to consideration under the terms of the contract before it transfers goods or services to the customer.

The Company’s collaborative arrangements with its investees and related parties typically include upfront payments consisting of cash or non-cash consideration for future research and development services and non-cash consideration in the form of convertible financial instruments and equity securities for licenses that will be transferred in the future.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

will be transferred in the future.

The Company records the upfront cash payments and fair value of the convertible financial instruments and equity securities as deferred revenue.

1 unchanged sentence

Contract liabilities are recognized as revenue as (or when) the Company performs under the contract.

During the three months ended March 31, 2024, the Company recognized $ 13.8 million of revenue that was included in the contract liabilities balance of $ 202.5 million as of December 31, 2023.

During the three months ended March 31, 2023, the Company recognized $ 24.4 million of revenue that was included in the contract liabilities balance of $ 222.6 million as of December 31, 2022.

During the six months ended June 30, 2024, the Company recognized $ 29.4 million of revenue that was included in the contract liabilities balance of $ 202.5 million as of December 31, 2023.

During the six months ended June 30, 2023, the Company recognized $ 44.1 million of revenue that was included in the contract liabilities balance of $ 222.6 million as of December 31, 2022.

Performance Obligations

The aggregate amount of the transaction price that was allocated to performance obligations that have not yet been satisfied or are partially satisfied as of March 31, 2024 and December 31, 2023 was $ 96.9 million and $ 110.0 million, respectively.

The aggregate amount of the transaction price that was allocated to performance obligations that have not yet been satisfied or are partially satisfied as of June 30, 2024 and December 31, 2023 was $ 76.8 million and $ 110.0 million, respectively.

The Company has elected the practical expedient not to provide the remaining performance obligation disclosures related to contracts for which the Company recognizes revenue on a cost-plus basis in the amount to which it has the right to invoice, and for contracts with a term of one year or less.

As of March 31, 2024, of the performance obligations not yet satisfied or partially satisfied, nearly all is expected to be recognized as revenue during the years 2024 to 2027.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

As of June 30, 2024, of the performance obligations not yet satisfied or partially satisfied, nearly all is expected to be recognized as revenue during the years 2024 to 2027.

Segment Information

1 unchanged sentence

Cell Engineering and Biosecurity.

The Company’s chief operating decision makers (“CODMs”) evaluate the financial performance of the Company’s segments based upon segment revenues and operating results.

The Company’s measure of segment operating results for management reporting purposes excludes the impact of stock-based compensation expense, depreciation and amortization, asset impairment charges, restructuring charges, and change in fair value of certain contingent liabilities.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

The following table presents summary results of the Company’s reportable segments for the periods indicated (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Cell Engineering $ 36,205 $ 45,283 $ 64,094 $ 79,379

2 unchanged sentences

Segment cost of revenue:

Cell Engineering 1,914 — 1,914 —

Biosecurity 11,807 18,096 21,009 40,471

15 unchanged sentences

Depreciation and amortization 17,330 17,652 30,199 36,610

Impairment expense (2)

47,858 9,001 47,858 9,001

Restructuring charges (3)

17,066 — 17,066 —

Change in fair value of contingent consideration liability 3,211 3,276 2,284 8,453

Loss from operations $ ( 222,945 ) $ ( 184,151 ) $ ( 400,947 ) $ ( 399,896 )

(1) Includes $ 1.6 million and $ 2.2 million in employer payroll taxes for the three months ended March 31, 2024 and 2023, respectively.

(1) Includes $ 1.1 million and $ 1.0 million in employer payroll taxes for the three months ended June 30, 2024 and 2023, respectively, and $ 2.7 million and $ 3.2 million in employer payroll taxes for the six months ended June 30, 2024 and 2023, respectively.

(2) Includes $ 47.9 million related to goodwill impairment in the three and six months ended June 30, 2024 and $ 9.0 million related to impairment of lab equipment acquired as part of the Zymergen acquisition in the three and six months ended June 30, 2023.

(3) See Note 3 , Restructuring, for composition of costs.

Net Loss per Share

4 unchanged sentences

Notes to Condensed Consolidated Financial Statements

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Net loss, basic $ ( 217,181 ) $ ( 173,315 ) $ ( 383,092 ) $ ( 378,284 )

8 unchanged sentences

The following potential common shares, presented based on amounts outstanding at each period end, were excluded from the calculation of diluted net loss per share for the periods presented because including them would have been anti-dilutive (in thousands):

As of March 31,

As of June 30, 2024 As of June 30, 2023

Unvested RSUs 219,177 184,236

12 unchanged sentences

Significant related party transactions included in the condensed consolidated balance sheet are summarized below (in thousands):

As of March 31, As of December 31,

Accounts receivable:

Ayana Bio $ 277 $ 233

Allonnia 71 322

BiomEdit 21 —

Verb Biotics 1 61

As of June 30, 2024 As of December 31, 2023

Deferred revenue, current and non-current:

8 unchanged sentences

Significant related party transactions included in the condensed consolidated statement of operations and comprehensive loss are summarized below (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Cell Engineering revenue:

9 unchanged sentences

Refer to Note 5 for additional details on the Company’s investments and equity method investments held in its related parties.

Ginkgo Bioworks Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

Subsequent Events

On May 9, 2024, in connection with the Company’s plans to reduce operational expenditures, management approved a plan for restructuring actions, including an expected reduction in labor expenses and a planned consolidation of certain of its facilities.

Initial headcount reductions are expected to commence in the second quarter of 2024 and be substantially completed in 2025, subject to local laws.

The aggregate expected costs and overall timing for completion of the restructuring plan is not yet known.

On April 10, 2024, the Company acquired platform assets, including fully sequenced and isolated strains, unique gene sequences, and relevant functional data and metadata, as well as a development pipeline from AgBiome, Inc.

These assets will be integrated into the Company’s Ag Biologicals Services, established with the acquisition of a Bayer agricultural biologicals R&D facility in 2022, and expands Ginkgo’s proprietary unified metagenomics database.

The acquisition was completed with the issuance of unregistered Class A common stock with registration rights and a price protection provision that requires the issuance of additional shares should the price per Class A common shares decline by more than a specified threshold prior to registration of the shares or 6 months, whichever is sooner.

The Company has not yet completed its accounting for the acquisition.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements