What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-12-26 compared with 2024-12-26 · 67 added, 124 removed, 140 unchanged (58% of the section changed)

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Financial Statements (Unaudited)” in this Quarterly Report on Form 10-Q/A (the “Amended Report") and our audited Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in Amendment No.

1 to our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the U.S.

1 to our Annual Report on Form 10-K/A for the year ended December 31, 2023, as filed with the U.S.

Securities and Exchange Commission (the “SEC”) on December 23, 2024 (the “Amended Annual Report”).

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Risk Factors” and “Note Regarding Forward-Looking Statements” included in this Amended Report, “Part II, Item 1A.

Risk Factors" of the Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2024 (the "Original Report"), as filed with the SEC on August 8, 2024, or “Part I, Item 1A.

Risk Factors” of the Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2024 (the “ Original Report ” ), as filed with the SEC on May 8, 2024, or “Part I, Item 1A.

Risk Factors” of the Amended Annual Report, as may be updated by Part II, Item 1A.

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Controls and Procedures.”

Other than to reflect effects of the Restatement, this discussion does not reflect any information or events occurring after August 8, 2024, the filing date of the Original Report, or modify or update those disclosures affected by events that occurred at a later date or facts that subsequently became known to us, except to the extent they are otherwise required to be included and discussed herein.

Other than to reflect effects of the Restatement, this discussion does not reflect any information or events occurring after May 8, 2024, the filing date of the Original Report, or modify or update those disclosures affected by events that occurred at a later date or facts that subsequently became known to us, except to the extent they are otherwise required to be included and discussed herein.

Overview (As Restated)

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The ability of our Simoa platforms to detect proteins in the femtomolar range is enabling the development of novel therapies and diagnostics and has the potential to facilitate a paradigm shift in healthcare from an emphasis on treatment to a focus on earlier detection, monitoring, prognosis, and, ultimately, prevention.

Our Simoa platforms have achieved significant scientific validation and commercial adoption, and our Simoa technology has been cited in more tha n 2,900 sc ientific publications in areas of high unmet medical need and research interest such as neurology, oncology, cardiology, infectious disease, and inflammation.

Our Simoa platforms have achieved significant scientific validation and commercial adoption, and our Simoa technology has been cited in more than 2,900 scientific publications in areas of high unmet medical need and research interest such as neurology, oncology, cardiology, infectious disease, and inflammation.

Our instruments are designed to be used either with assays fully developed by us, including all antibodies and supplies required to run the assays, or with “homebrew” assay kits where we supply some of the components required for testing and the customer supplies the remaining required elements.

Accordingly, our installed instruments generate a recurring revenue stream through the sale of these consumables.

Accordingly, our installed instruments generate a recurring revenue stream.

As the installed base of our Simoa instruments increases, we expect total consumables revenue to increase.

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The HD-X uses our bead-based technology and assays run on the HD-X are fully automated.

At June 30, 2024 , approximate ly 83% of the HD Instrument installed base were HD-X instruments.

By March 31, 2024, approximately 83% of the HD Instrument installed base were HD-X instruments.

Further, we launched our SR-X instrument in 2017 as a compact desktop instrument with a lower price point, more flexible assay preparation, and a wider range of applications.

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We also provide contract research services for customers and Laboratory Developed Test (“LDT”) services through our CLIA-certified Accelerator Laboratory (the “Accelerator Laboratory”).

The Accelerator Laboratory provides customers with access to our Simoa technology and our Lucent Diagnostics clinical testing services (launched in July 2023), and supports multiple projects and services, including sample tes ting, homebrew assay development, custom assay development, and blood-based biomarker testing.

The Accelerator Laboratory provides customers with access to our Simoa technology and our Lucent Diagnostics clinical testing services (launched in July 2023), and supports multiple projects and services, including sample testing, homebrew assay development, custom assay development, and blood-based biomarker testing.

To date, we have completed over 2,300 projects for more than 480 customers from all over the world using our Simoa platforms.

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We sell our instruments, consumables, and services through a direct field sales force and support organizations in North America and Europe, and through our own sales force and distributors in additional countries, including Australia, Brazil, China, Czech Republic, India, Hong Kong, Israel, Japan, New Zealand, Qatar, Saudi Arabia, Singapore, South Africa, South Korea, Taiwan, and the United Arab Emirates.

As of June 30, 2024 , we had cash, cash equivalents, and marketable securities of $296.9 million .

Since our inception, we have incurred annual net losses.

Our net losses were $7.4 million and $18.6 million for the three and six months ended June 30, 2024 , respectively, and $5.6 million and $12.8 million for the three and six months ended June 30, 2023 , respectively.

As of June 30, 2024 , we had an accumulated deficit of $450.1 million and stockholders’ equity of $340.8 million .

In addition, we sell NfL antibodies and NfL ELISA kits directly, and through distributors, worldwide.

As of March 31, 2024, we had cash, cash equivalents, and marketable securities of $301.9 million .

Since our inception, we have incurred annual net losses, including net losses of $11.2 million and $7.3 million for the three months ended March 31, 2024 and 2023, respectively.

As of March 31, 2024, we had an accumulated deficit of $442.7 million and stockholders’ equity of $343.4 million .

We expect to incur significant expenses and operating losses at least through the next 24 months and we expect our expenses to increase substantially as we:

• expand our sales and marketing efforts to further commercialize our products;

• expand our research and development efforts to improve our existing, or to develop and launch, new assays and instruments.

These expenses could be particularly significant if any of our products become subject to additional or more burdensome regulation by the U.S.

• expand our research and development efforts to improve our existing products and develop and launch new products, particularly if any of our products become subject to additional or more burdensome regulation by the U.S.

Food and Drug Administration (the “FDA”);

• invest in Lucent Diagnostics, additional LDTs, and other diagnostics initiatives including entry into translational pharma and clinical diagnostic markets;

• seek Premarket Approval (“PMA”), de novo classification, or 510(k) clearance from the FDA for our existing products or new products, including new assays and instruments, if or when we decide to market products for use in the prevention, diagnosis, or treatment of a disease or other condition;

• seek Premarket Approval (“PMA”), de novo classification, or 510(k) clearance from the FDA for our existing products or new products if or when we decide to market products for use in the prevention, diagnosis, or treatment of a disease or other condition;

• hire additional personnel to support our growth and research and development;

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• enter into collaboration arrangements, or in-license other products and technologies;

• add or enhance operational, financial, and management information systems.

• add operational, financial, and management information systems.

Recent Business Developments

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This designation is granted to products that have the potential to offer more effective diagnosis of life-threatening diseases with an unmet medical need.

Proposed indications for this blood test include use of the test results in patients presenting with cognitive impairment who are being evaluated for Alzheimer’s disease risk to aid in diagnostic evaluation.

Proposed indications for this blood test include use of the test results in patients presenting

with cognitive impairment who are being evaluated for Alzheimer’s disease risk to aid in diagnostic evaluation.

The test is not intended as a stand-alone diagnostic test and test results will be interpreted in conjunction with other diagnostic tools to establish a final clinical diagnosis.

This test has not been otherwise cleared or approved by the FDA and Breakthrough Device designation does not guarantee that the FDA review and approval process will be shortened or that an application will be approved.

We do not expect material revenue from this test, or other Lucent Diagnostics tests, until 2025 or later, if at all.

We do not expect material revenue from this test, or other Lucent Diagnostics tests, until late 2024 or later, if at all.

During the fourth quarter of 2023, we substantially completed our six-quarter assay redevelopment program.

The objective of this operational program was to improve our ability to manufacture and deliver high-quality assays at scale.

Since then, and using the improved protocols resulting from the redevelopment program, we have launched our new Simoa Advantage PLUS assays and continue to transition existing assays to Advantage PLUS.

The improved protocols leverage manufacturing efficiencies and reagent improvements to provide more consistent results and improved lot-to-lot consistency, which also enables production of larger lot sizes with extended shelf lives.

Advantage PLUS assays began shipping to customers in the first quarter of 2024.

We have now launched five new Simoa Advantage PLUS assays, which have been developed using improved protocols, by leveraging manufacturing efficiencies and reagent improvements to provide more consistent results and improved lot-to-lot consistency, and through enabling production of larger lot sizes with extended shelf lives.

These assays began shipping to customers in the first quarter of 2024.

We expect to continue to apply these improved protocols and manufacturing efficiencies to other existing assays as well as assays that we may develop in the future.

Comparison of Results of Operations for Three Months Ended June 30, 2024 and 2023:

The following table sets forth select Consolidated Statements of Operations data, and such data as a percentage of total revenues (in thousands, except percentages):

Three Months Ended June 30, Increase (Decrease)

2024 % of revenue 2023 % of revenue Amount %

(As Restated) (As Restated)

Product revenue $ 19,887 58 % $ 19,549 63 % $ 338 2 %

Service and other revenue 13,511 39 % 10,470 34 % 3,041 29 %

Collaboration and license revenue 729 2 % 629 2 % 100 16 %

Grant revenue 254 1 % 156 1 % 98 63 %

Total revenues 34,381 100 % 30,804 100 % 3,577 12 %

Costs of goods sold and services:

Cost of product revenue 6,670 19 % 6,701 22 % (31) — %

Cost of service and other revenue 5,477 16 % 4,687 15 % 790 17 %

Total costs of goods sold and services 12,147 35 % 11,388 37 % 759 7 %

Gross profit 22,234 65 % 19,416 63 % 2,818 15 %

Operating expenses:

Research and development 8,169 24 % 6,128 20 % 2,041 33 %

Selling, general and administrative 24,080 70 % 21,308 69 % 2,772 13 %

Other lease costs 927 3 % 968 3 % (41) (4) %

Total operating expenses 33,176 96 % 28,404 92 % 4,772 17 %

Loss from operations (10,942) (32) % (8,988) (29) % (1,954) 22 %

Interest income 3,681 11 % 3,886 13 % (205) (5) %

Other income (expense), net (9) — % (214) (1) % 205 (96) %

Loss before income taxes (7,270) (21) % (5,316) (17) % (1,954) 37 %

Income tax expense (117) — % (235) (1) % 118 (50) %

Net loss $ (7,387) (21) % $ (5,551) (18) % $ (1,836) 33 %

Revenues (As Restated)

Total revenues increased $3.6 million, or 12%, to $34.4 million for the three months ended June 30, 2024, compared to $30.8 million for the three months ended June 30, 2023.

Product revenue of $19.9 million for the three months ended June 30, 2024 consisted of instrument sales of $2.5 million and sales of consumables and other products of $17.4 million.

This represented an increase of $0.3 million compared to product revenue of $19.5 million for the three months ended June 30, 2023.

The increase in product revenue was primarily due to a $1.1 million increase from growth in consumables demand.

This increase was partially offset by a decrease from the one-time receipt of ordinary shares in UltraDx in the second quarter of 2023 with a fair value of $0.8 million that was recognized as variable consideration revenue under the UltraDx Agreement (as a Level 3 financial asset, the fair value was determined primarily using the third-party purchase price of similar instruments issued by UltraDx), and a $0.8 million decrease in instrument sales due to reduced demand in what we believe is a constrained capital funding environment.

Based on the constrained capital funding environment, we expect softness in instrument sales to continue for the remainder of 2024.

Service revenue was $13.5 million for the three months ended June 30, 2024, compared to $10.5 million for the three months ended June 30, 2023, an increase of $3.0 million, or 29%.

This increase was primarily due to a $2.6 million increase in Accelerator Laboratory revenue driven by higher volumes of sample testing and assay development services, as well as higher selling prices.

We expect to see continued growth in Accelerator Laboratory services through 2024.

Cost of Goods Sold and Services (As Restated)

Total cost of goods sold and services increased $0.8 million , or 7% , to $12.1 million for the three months ended June 30, 2024 , compared to $11.4 million for the three months ended June 30, 2023 .

Cost of product revenue was $6.7 million for both the three months ended June 30, 2024 , and the three months ended June 30, 2023, and is consistent with flat product revenue growth during the same periods .

Cost of service and other revenue increased $0.8 million , or 17% , to $5.5 million for the three months ended June 30, 2024 , compared to $4.7 million for the three months ended June 30, 2023 .

This increase was primarily due to the increase in Accelerator Laboratory services .

Research and Development (As Restated)

Research and development expense increased $2.0 million, or 33%, to $8.2 million for the three months ended June 30, 2024, compared to $6.1 million for the three months ended June 30, 2023.

This increase was primarily due to a $1.1 million increase in compensation and benefits costs related to increased headcount and a $0.8 million increase in outside services and research lab supplies and equipment to enable product development.

We expect research and development expense to continue to increase throughout 2024 and into 2025 due to continued investment in new instrument and assay development.

Selling, General and Administrative (As Restated)

Selling, general and administrative expense increased $2.8 million, or 13%, to $24.1 million for the three months ended June 30, 2024, compared to $21.3 million for the three months ended June 30, 2023.

This increase was primarily due to a $1.8 million increase in compensation and benefits costs and a $0.8 million increase in stock-based compensation expense, both due to increased headcount.

Included within selling, general, and administrative expense are $2.1 million and $1.6 million of shipping and handling costs for product sales for the three months ended June 30, 2024 and 2023, respectively.

Other Lease Costs (As Restated)

Other lease costs decreased $0.1 million, or 4% to $0.9 million for the three months ended June 30, 2024, compared to $1.0 million for the three months ended June 30, 2023.

We are not using two leased office and laboratory facilities and are evaluating alternatives, including sub-leasing the facilities.

Other lease costs include amortization of the related operating lease right-of-use assets and other leased facility operating expenses from periods after determining that the facilities would not be used.

Interest Income

Interest income decreased $0.2 million, or 5%, to $3.7 million for the three months ended June 30, 2024, as compared to $3.9 million for the three months ended June 30, 2023.

Other Income (Expense), Net (As Restated)

Other income (expense), net was less than $0.1 million for the three months ended June 30, 2024, as compared to $0.2 million for the three months ended June 30, 2023.

Income Tax Expense

Income tax expense was $0.1 million for the three months ended June 30, 2024, as compared to $0.2 million for the three months ended June 30, 2023.

Comparison of Results of Operations for Six Months Ended June 30, 2024 and 2023:

Comparison of Results of Operations for Three Months Ended March 31, 2024 and 2023:

The following table sets forth select Consolidated Statements of Operations data, and such data as a percentage of total revenues (in thousands, except percentages):

Six Months Ended June 30, Increase (Decrease)

Three Months Ended March 31, Increase (Decrease)

2024 % of revenue 2023 % of revenue Amount %

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Other income (expense), net

226 1 % (5) — % 231 (4,620) %

Loss before income taxes (10,983) (34) % (7,134) (25) % 3,849 54 %

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Revenues (As Restated)

Total revenues increased $7.2 million, or 12%, to $66.4 million for the six months ended June 30, 2024, compared to $59.3 million for the six months ended June 30, 2023.

Product revenue of $39.6 million for the six months ended June 30, 2024 consisted of instrument sales of $5.0 million and sales of consumables and other products of $34.5 million.

This represented an increase of $0.6 million, or 2%, compared to product revenue of $38.9 million for the six months ended June 30, 2023.

The increase in product revenue was

primarily due to a $4.2 million increase in consumables from growth in both demand and selling prices.

This increase was partially offset by a decrease from the one-time receipt of ordinary shares in UltraDx in the second quarter of 2023 with a fair value of $0.8 million that was recognized as variable consideration revenue under the UltraDx Agreement (as a Level 3 financial asset, the fair value was determined primarily using the third-party purchase price of similar instruments issued by UltraDx), and a $3.5 million decrease in instrument sales due to reduced demand in what we believe is a constrained capital funding environment.

Based on the constrained capital funding environment, we expect softness in instrument sales to continue for the remainder of 2024.

Service revenue was $25.5 million for the six months ended June 30, 2024, compared to $19.0 million for the six months ended June 30, 2023, an increase of $6.5 million, or 34%.

This increase was primarily due to a $5.8 million increase in Accelerator Laboratory revenue driven by higher volumes of sample testing and assay development services, as well as higher selling prices.

Total revenues increased $3.6 million, or 13%, to $32.1 million for the three months ended March 31, 2024, compared to $28.5 million for the three months ended March 31, 2023.

Product revenue of $19.7 million for the three months ended March 31, 2024 consisted of instrument sales of $2.5 million and sales of consumables and other products of $17.1 million.

This represented an increase of $0.3 million, or 2%, compared to product revenue of $19.4 million for the three months ended March 31, 2023.

The increase in product revenue was primarily due to a $3.0 million increase in sales of consumables from increases in both customer demand and selling prices.

This increase was partially offset by a $2.7 million decrease in instrument sales due to reduced demand in what we believe is a constrained capital funding environment.

Based on this, we expect softness in instrument sales to continue for the remainder of 2024.

Service revenue was $12.0 million for the three months ended March 31, 2024, compared to $8.5 million for the three months ended March 31, 2023, an increase of $3.5 million, or 41% .

This increase was primarily due to a $3.2 million increase in Accelerator Laboratory revenue driven by higher volumes of sample testing and assay development services.

We expect to see continued growth in Accelerator Laboratory services through 2024.

Cost of Goods Sold and Services (As Restated)

Total cost of goods sold and services increased $1.8 million , or 8% , to $25.7 million for the six months ended June 30, 2024 , compared to $23.9 million for the six months ended June 30, 2023 .

Cost of product revenue increased $0.3 million , or 2% , to $14.9 million for the six months ended June 30, 2024 , compared to $14.6 million for the six months ended June 30, 2023 .

This increase was primarily due to increases in overhead costs and increased consumables sales, and was partially offset by decreased costs due to lower instrument sales.

Cost of service and other revenue increased $1.5 million , or 16% , to $10.8 million for the six months ended June 30, 2024 , compared to $9.3 million for the six months ended June 30, 2023 .

This increase was primarily due to the increase in Accelerator Laboratory services and royalty payments .

Total cost of goods sold and services increased $1.1 million , or 8% , to $13.5 million for the three months ended March 31, 2024 , compared to $12.5 million for the three months ended March 31, 2023 .

Cost of product revenue increased $0.4 million , or 5% , to $8.2 million for the three months ended March 31, 2024 , compared to $7.9 million for the three months ended March 31, 2023 .

This increase was primarily due to consumables related revenue increases, including compensation and benefit costs from increased headcount, and was partially offset by decreased costs due to lower instrument revenue.

Cost of service and other revenue increased $0.7 million , or 15% , to $5.3 million for the three months ended March 31, 2024 , compared to $4.6 million for the three months ended March 31, 2023 .

This increase was primarily due to the increase in Accelerator Laboratory revenue, including compensation and benefit costs from increased headcount and increased volume of lab supplies used.

Research and Development (As Restated)

Research and development expense increased $3.8 million, or 34%, to $14.9 million for the six months ended June 30, 2024, compared to $11.1 million for the six months ended June 30, 2023.

This increase was primarily due to (1) a $1.7 million increase in compensation and benefits costs related to increased headcount, (2) a $1.1 million increase in costs of outside services and research lab supplies and equipment to enable product development, and (3) a $0.3 million increase in stock-based compensation expense due to increased headcount.

We expect research and development expense to continue to increase throughout 2024 and into 2025 due to continued investment in new instrument and assay development.

Research and development expense increased $1.8 million, or 35%, to $6.7 million for the three months ended March 31, 2024 , compared to $5.0 million for the three months ended March 31, 2023.

This increase was primarily due to a $1.1 million increase in compensation and benefits costs related to increased headcount, and a $0.5 million increase in professional services and research lab supplies and equipment to enable product development.

We expect research and development expense to continue to increase throughout 2024 due to continued investments in product development and new offerings.

Selling, General and Administrative (As Restated)

Selling, general and administrative expense increased $8.0 million, or 19%, to $50.1 million for the six months ended June 30, 2024, compared to $42.1 million for the six months ended June 30, 2023.

This increase was primarily due to (1) a $4.6 million increase in compensation and benefits costs related to increased headcount, (2) a $1.9 million increase in stock-based compensation expense due to increased headcount, (3) a $0.8 million increase in software and technology expenses, and (4) a $0.8 million increase in distribution costs.

Included within selling, general, and administrative expense are $4.2 million and $3.5 million of shipping and handling costs for product sales for the six months ended June 30, 2024 and 2023, respectively.

Selling, general and administrative expense increased $5.3 million, or 25%, to $26.0 million for the three months ended March 31, 2024, compared to $20.8 million for the three months ended March 31, 2023.

The primary reason for the increase is additional headcount to expand the size of our sales team.

More specifically, the increase was primarily due to (1) a $3.3 million increase in personnel related costs, primarily compensation and benefits related to increased headcount, (2) a $1.1 million increase in stock-based compensation expense due to increased headcount, and (3) a $0.6 million increase in travel related expenses.

Included within selling, general, and administrative expense are $2.1 million and $1.8 million of shipping and handling costs for product sales for the three months ended March 31, 2024 and 2023, respectively.

Other Lease Costs (As Restated)

Other lease costs increased $0.1 million, or 5%, to $1.9 million for the six months ended June 30, 2024, compared to $1.8 million for the six months ended June 30, 2023.

We are not using two leased office and laboratory facilities and are evaluating alternatives, including sub-leasing the facilities.

Other lease costs increased $0.1 million , or 16% to $0.9 million for the three months ended March 31, 2024 , compared to $0.8 million for the three months ended March 31, 2023.

Following our restructuring in 2022, we are not using two leased office and laboratory facilities and are evaluating alternatives, including sub-leasing the facilities .

Other lease costs include amortization of the related operating lease right-of-use assets and other leased facility operating expenses from periods after the restructuring and determination that the facilities would not be used.

Interest Income

Interest income increased $0.3 million, or 4%, to $7.6 million for the six months ended June 30, 2024, as compared to $7.3 million for the six months ended June 30, 2023.

Interest income increased $0.5 million , or 14% , to $3.9 million for the three months ended March 31, 2024 , as compared to $3.4 million for the three months ended March 31, 2023 .

This increase was primarily due to higher interest rates earned on cash, cash equivalents, and marketable securities, and the accretion of discounts from the purchase of marketable securities.

Other Income (Expense), Net (As Restated)

Other income (expense), net was $0.2 million for the six months ended June 30, 2024, as compared $(0.2) million for the six months ended June 30, 2023.

Other income (expense), net was $0.2 million for the three months ended March 31, 2024, as compared to less than $0.1 million for the three months ended March 31, 2023.

Income Tax Expense

Income tax expense was $0.3 million for the six months ended June 30, 2024, as compared to $0.4 million for the six months ended June 30, 2023.

Liquidity and Capital Resources (As Restated)

Income tax expense was $0.2 million for the three months ended March 31, 2024, as compared to $0.1 million for the three months ended March 31, 2023.

The decrease was primarily due to estimated foreign income taxes.

Liquidity and Capital Resources

Our principal sources of liquidity are cash, cash equivalents, marketable securities, and funds generated from sales of our products and services.

As of June 30, 2024 , we had cash and cash equivalents of $47.0 million and $249.9 million of available for sale marketable securities.

As of March 31, 2024, we had cash and cash equivalents of $45.3 million and $256.6 million of available for sale marketable securities.

Historically we have also financed our operations through equity offerings and borrowings from credit facilities.

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Our liquidity requirements have consisted, and we expect that they will continue to consist, of sales and marketing expenses, research and development expenses, working capital, and general corporate expenses.

Our future capital requirements will depend on many factors, including, but not limited to, our pace of growth, expansion or introduction of instruments, assays, and services, including Lucent Diagnostics, and advancing access to our diagnostic tests, market acceptance of our products and services, regulatory requirements, regulatory approval of our products or services, and the effects of competition, technological developments, and broader market and economic trends.

Our future capital requirements will depend on many factors, including, but not limited to, our pace of growth, expansion and introduction of new products and services, including Lucent Diagnostics, and advancing access to our diagnostic tests, market acceptance of our products and services, regulatory requirements, regulatory approval of our products or services, and the effects of competition, technological developments, and broader market and economic trends.

We regularly assess potential acquisitions and pursue acquisitions of complementary businesses, services, and technologies.

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The following table summarizes our cash flows (in thousands):

Six Months Ended June 30,

Three Months Ended March 31,

(As Restated)

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We have historically experienced negative cash flows from operating activities as we have developed our technology, expanded our business, and built our infrastructure.

We expect negative cash flows from operating activities will continue in future periods.

Net cash used in operating activities was $25.1 million and $8.8 million for the six months ended June 30, 2024 and 2023, respectively.

The $16.3 million increase in net cash used in operating activities was primarily driven by an overall increase in our net loss, adjusted for non-cash items including stock-based compensation, accretion of our marketable securities, and depreciation and amortization.

The increase was further driven by changes in working capital items, primarily (1) an increase in accounts receivable from sales timing and revenue growth, (2) an increase in inventory as a result of completing the assay development program and manufacturing and stocking new assays, and (3) increases in accrued compensation and benefits, accrued expenses, and other current liabilities.

Net Cash Used in Investing Activities (As Restated)

Our primary investing activities consist of purchases of marketable securities.

We expect negative cash flows from operating activities will continue in the future.

Net cash used in operating activities was $20.2 million and $9.8 million for the three months ended March 31, 2024 and 2023, respectively.

The $10.4 million increase in net cash used in operating activities was primarily driven by an overall increase in our net loss, adjusted for non-cash items including stock-based compensation and the accretion of our marketable securities.

The increase was further driven by changes in working capital items, primarily (1) an increase in accounts receivable and deferred revenue from sales timing and revenue growth, (2) an increase in inventory as a result of completing the assay development program and manufacturing and stocking new assays, and (3) a decrease in accrued compensation.

Net Cash Used in Investing Activities

Our primary investing activities consist of purchases of marketable securities to increase the interest income we would otherwise earn in cash accounts.

Additionally, we use funds towards capital expenditures for the purchase of property and equipment to support our expanding infrastructure and work force.

We expect to continue to incur additional capital expenditures related to these efforts in future periods.

Net cash used in investing activities was $102.2 million during the six months ended June 30, 2024, which consisted of the purchase of $189.3 million of marketable securities and $2.1 million of purchases of property and equipment, offset by proceeds from maturities of marketable securities of $89.2 million.

Net cash used in investing activities was not material during the six months ended June 30, 2023.

Net cash used in investing activities was $109.2 million during the three months ended March 31, 2024, which consisted of the purchase of $137.9 million of marketable securities and $0.5 million of purchases of property and equipment, offset by proceeds from the maturities of marketable securities of $29.2 million.

Net cash used in investing activities was not material during the three months ended March 31, 2023.

Net Cash Provided by Financing Activities

Financing activities provided $0.3 million and $0.7 million of cash during six months ended June 30, 2024 and 2023, respectively, from the issuance of our common stock under our equity incentive plans.

Financing activities provided $0.6 million of cash during both the three months ended March 31, 2024 and 2023 , from sales of our common stock under our employee stock purchase plan and from the exercise of options under our equity incentive plan .

Future Cash Obligations

As of June 30, 2024, there have been no material changes to our contractual obligations and commitments from those described in the section titled “Part II, Item 7.

As of March 31, 2024, there have been no material changes to our contractual obligations and commitments from those described in the section titled “Part II, Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Amended Annual Report.

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Set forth below is a reconciliation of non-GAAP gross profit, non-GAAP gross margin, non-GAAP total operating expenses, and non-GAAP loss from operations to their most directly comparable GAAP financial measures (in thousands):

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

2024 2023 2024 2023

(As Restated) (As Restated) (As Restated) (As Restated)

Three Months Ended March 31,

(As Restated)

GAAP gross profit $ 18,548 $ 15,993

12 unchanged sentences

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/A

Item 2. Management’s Discussion and Analysis