Standard BioTools Reports Second Quarter 2023 Financial Results

Standard BioTools Reports Second Quarter 2023 Financial Results

Continued operational execution improves revenue growth, margin expansion, and expense reduction

SOUTH SAN FRANCISCO, Calif., Aug. 08, 2023 (GLOBE NEWSWIRE) -- Standard BioTools Inc. (Nasdaq:LAB) (“Standard BioTools”, or the “Company”), driven by a bold purpose – Unleashing tools to accelerate breakthroughs in human health – today reported financial results for the second quarter ended June 30, 2023.

Selected Financial Results

(Numbers in millions, except percentages)Quarter Ended
June 30, 2023		 Quarter Ended
June 30, 2022
Revenue$27.7 $18.8(a)
Gross margin49.2% 23.6%
Non-GAAP gross margin60.9% 40.2%
Operating expenses$31.1 $43.0
Non-GAAP operating expenses$25.2 $33.8
Operating loss($17.4) ($38.6)
Net loss($17.0) ($63.5)
Non-GAAP adjusted EBITDA($8.4) ($26.2)
Cash and equivalents, restricted cash, and short-term investments$143.1 $212.2

(a)   Quarter ended June 30, 2022 includes $1.6 million revenue offset to establish return reserve for discontinued product line.

Second Quarter and First Half 2023 Financial Highlights Compared to 2022

  • Total revenue grew 47% in the second quarter of 2023 and 17% in the first half of 2023.
  • Non-GAAP gross margin expanded by over 2,000 basis points in the second quarter of 2023 and over 1,000 basis points in the first half of 2023.
  • Non-GAAP operating expenses declined over $8 million, or 25%, in the second quarter of 2023 and nearly $18 million, or 26%, in the first half of 2023.
  • Non-GAAP adjusted EBITDA loss improved over $17 million in the quarter and over $27 million in the first half of 2023. Operating cash use decreased over 70% to $8.5 million in the second quarter of 2023 and decreased over 60% to $17.7 million in the first half of 2023.
  • Cash, cash equivalents, and short-term investments (including restricted cash) on June 30, 2023, totaled $143 million.

“I am pleased to report our second quarter results and the visible improvement to many of our key performance metrics, especially in light of an uncertain macroeconomic environment,” said Michael Egholm, PhD, President and Chief Executive Officer of Standard BioTools™. “The growth of our top line comes directly from disciplined sales execution and better overall operating efficiency across the organization,” Egholm said. “This has also allowed us to design and successfully launch the Hyperion XTi™ Imaging System, and we are encouraged by early customer traction.

“Continued success will come from building out our operational systems that deliver a portfolio of high value, high margin tools and solutions to researchers at a profit, while attracting personnel that fully embrace a lean culture and can execute at the highest level. In the last year we have completely transformed our senior management team to this standard and are now seeing in this quarter the early signs and benefit of having done so.”

A reconciliation of non-GAAP gross margins, non-GAAP operating expenses, and non-GAAP adjusted EBITDA is provided in the financial schedules that are part of this press release. An explanation of these non-GAAP financial measures is also included below under the heading "Use of Non-GAAP Financial Information."

Business Update

Proteomics: Following the launch of the Hyperion™ XTi Imaging System in April, the company shipped its first revenue units in the quarter with a growing order backlog. This system provides a market-leading performance with the highest data quality available in spatial proteomics and industry-leading shortest time to results.

Genomics: The company launched an upgrade to its X9™ High-Throughput Genomics System to enable next-generation sequencing (NGS) library preparation on the system to support discovery through screening. Customers can create NGS libraries and assess the quality and quantity in a single workflow ahead of expensive NGS runs. This unified approach has the potential to catch any errors earlier and ensure that samples will not go to waste.

Corporate: The company announced Jeff Black as its new Chief Financial Officer and Agnieszka (Aggie) Gallagher as Senior Vice President and Chief Legal Officer.

Conference Call Information 

The company’s management will host a conference call and webcast today at 2:00 p.m. PT, 5:00 p.m. ET, to discuss second quarter 2023 financial results and operational progress as well as to provide additional color on its strategic actions.  

Individuals interested in listening to the conference call may do so by dialing: 

US domestic callers: (888) 346-3970 
Outside US callers: (412) 902-4297 

Live audio of the webcast will be available online from the Investor Relations page of the company’s website at Events & Presentations. The webcast will be archived and available on the Standard BioTools Investor Relations page at investors.standardbio.com. 

Our investor presentation including Supplemental Financial Information has been posted on the investor relations section of our website concurrent with this news release.

Use of Non-GAAP Financial Information 

Standard BioTools has presented certain financial information in accordance with U.S. GAAP and also on a non-GAAP basis. The non-GAAP financial measures included in this press release are non-GAAP gross margin, non-GAAP operating expenses, and adjusted EBITDA. Management uses these non-GAAP financial measures, in addition to GAAP financial measures, as a measure of operating performance because the non-GAAP financial measures do not include the impact of items that management does not consider indicative of the Company’s core operating performance. Management believes that non-GAAP financial measures, taken in conjunction with GAAP financial measures, provide useful information for both management and investors by excluding certain non-cash and other expenses that are not indicative of the company’s core operating results. Management uses non-GAAP measures to compare the company’s performance relative to forecasts and strategic plans and to benchmark the company’s performance externally against competitors. Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used to supplement an understanding of the company’s operating results as reported under U.S. GAAP. Standard BioTools encourages investors to carefully consider its results under GAAP, as well as its supplemental non-GAAP information and the reconciliations between these presentations, to more fully understand its business. Reconciliations between GAAP and non-GAAP operating results are presented in the accompanying tables of this release.   

Use of Forward-Looking Statements 

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, among others, guidance, including related to revenues, margin, and operating expenses, and statements regarding future financial performance and expectations, operational and strategic plans, deployment of capital, our cash runway and sufficiency of cash resources, potential M&A activity, and expectations with respect to our restructuring plans (including expense reduction activities). Forward-looking statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from currently anticipated results, including but not limited to risks that we may not realize expected cost savings from the restructuring, including the anticipated decrease in operational expenses, at the levels we expect; possible restructuring and transition-related disruption, including through the loss of customers, suppliers, and employees and adverse impacts on our development activities and results of operation; restructuring activities, including our subleasing plans, customer and employee relations, management distraction, and reduced operating performance; risks that internal and external costs required for ongoing and planned activities may be higher than expected, which may cause us to use cash more quickly than we expect or change or curtail some of our plans, or both; risks that our expectations as to expenses, cash usage, and cash needs may prove not to be correct for other reasons such as changes in plans or actual events being different than our assumptions; changes in Standard BioTools’ business or external market conditions; challenges inherent in developing, manufacturing, launching, marketing, and selling new products; interruptions or delays in the supply of components or materials for, or manufacturing of, Standard BioTools products; reliance on sales of capital equipment for a significant proportion of revenues in each quarter; seasonal variations in customer operations; unanticipated increases in costs or expenses; uncertainties in contractual relationships; reductions in research and development spending or changes in budget priorities by customers; uncertainties relating to Standard BioTools’ research and development activities, and distribution plans and capabilities; potential product performance and quality issues; risks associated with international operations; intellectual property risks; and competition. Information on these and additional risks and uncertainties and other information affecting Standard BioTools’ business and operating results is contained in its Annual Report on Form 10-K for the year ended December 31, 2022, and in its other filings with the Securities and Exchange Commission. These forward-looking statements speak only as of the date hereof. Standard BioTools disclaims any obligation to update these forward-looking statements except as may be required by law. 

About Standard BioTools Inc. 
Standard BioTools Inc. (Nasdaq:LAB), previously known as Fluidigm Corporation, is driven by a bold purpose – Unleashing tools to accelerate breakthroughs in human health. Standard BioTools has an established portfolio of essential, standardized next-generation technologies that help biomedical researchers develop medicines faster and better. As a leading solutions provider, the company provides reliable and repeatable insights in health and disease using its proprietary mass cytometry and microfluidics technologies, which help transform scientific discoveries into better patient outcomes. Standard BioTools works with leading academic, government, pharmaceutical, biotechnology, plant and animal research, and clinical laboratories worldwide, focusing on the most pressing needs in translational and clinical research, including oncology, immunology, and immunotherapy. Learn more at www.standardbio.com or connect with us on Twitter®, Facebook®, LinkedIn, and YouTube™. Standard BioTools, the Standard BioTools logo, Fluidigm, the Fluidigm logo, “Unleashing tools to accelerate breakthroughs in human health,” Hyperion, Hyperion XTi, XTi, and X9 are trademarks and/or registered trademarks of Standard BioTools Inc. or its affiliates in the United States and/or other countries. Standard BioTools products are provided for Research Use Only. Not for use in diagnostic procedures.

Available Information 
Standard BioTools uses its website (standardbio.com), investor site (investors.standardbio.com), corporate Twitter account (@Standard_BioT), Facebook page (facebook.com/StandardBioT), and LinkedIn page (linkedin.com/company/standard-biotools) as channels of distribution of information about its products, its planned financial and other announcements, its attendance at upcoming investor and industry conferences, and other matters. Such information may be deemed material information, and Standard BioTools may use these channels to comply with its disclosure obligations under Regulation FD. Therefore, investors should monitor Standard BioTools’ website and its social media accounts in addition to following its press releases, SEC filings, public conference calls, and webcasts. 

Investor Contacts 

Scott R. Greenstone, CFA
[email protected] 

Peter DeNardo 
415 389 6400 
[email protected]

STANDARD BIOTOOLS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
        
 Three Months Ended June 30, Six Months Ended June 30,
 2023 2022 2023 2022
Revenue:       
Product revenue$21,665  $12,219  $39,103  $32,223 
Service revenue 5,821   5,806   12,702   11,950 
Other revenue 180   752   980   1,108 
Total revenue 27,666   18,777   52,785   45,281 
Cost of revenue:       
Cost of product revenue 11,883   12,738   21,873   25,077 
Cost of service revenue 2,181   1,612   4,973   3,540 
Total cost of revenue 14,064   14,350   26,846   28,617 
Gross profit 13,602   4,427   25,939   16,664 
Operating expenses:       
Research and development 6,184   12,606   12,669   21,471 
Selling, general and administrative 22,600   30,084   43,895   59,569 
Restructuring and related charges 2,267   300   3,417   1,690 
Total operating expenses 31,051   42,990   59,981   82,730 
Loss from operations (17,449)  (38,563)  (34,042)  (66,066)
Interest expense (1,129)  (1,062)  (2,246)  (2,092)
Loss on forward sale of Series B Preferred Stock —   (22,289)  —   (60,081)
Loss on Bridge Loans —   (3,064)  —   (13,719)
Other income (expense), net 1,839   (174)  2,969   (56)
Loss before income taxes (16,739)  (65,152)  (33,319)  (142,014)
Income tax benefit (expense) (301)  1,613   (564)  2,187 
Net loss$(17,040) $(63,539) $(33,883) $(139,827)
Net loss per share, basic and diluted$(0.22) $(0.82) $(0.43) $(1.81)
Shares used in computing net loss per share, basic and diluted 78,669   77,821   78,873   77,430 


STANDARD BIOTOOLS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
 June 30, 
2023		 December 31,
2022 (1)
ASSETS   
Current assets:   
Cash and cash equivalents$142,304  $81,309 
Short-term investments —   84,475 
Accounts receivable, net 15,119   17,280 
Inventories, net 22,080   21,473 
Prepaid expenses and other current assets 3,567   4,278 
Total current assets 183,070   208,815 
Property and equipment, net 24,522   25,652 
Operating lease right-of-use asset, net 32,194   33,883 
Other non-current assets 2,754   3,109 
Developed technology, net 7,000   12,600 
Goodwill 106,287   106,251 
Total assets$355,827  $390,310 
    
LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ DEFICIT   
Current liabilities:   
Accounts payable$6,089  $7,914 
Accrued compensation and related benefits 9,765   9,153 
Operating lease liabilities, current 3,912   3,682 
Deferred revenue, current 11,685   10,792 
Deferred grant income, current 3,630   3,644 
Other accrued liabilities 7,176   6,175 
Term loan, current 4,583   2,083 
Total current liabilities 46,840   43,443 
Convertible notes, net 54,853   54,615 
Term loan, non-current 5,809   8,194 
Deferred tax liability 1,049   1,055 
Operating lease liabilities, non-current 32,231   34,081 
Deferred revenue, non-current 3,790   3,816 
Deferred grant income, non-current 12,546   14,359 
Other non-current liabilities 843   961 
Total liabilities 157,961   160,524 
Mezzanine equity:   
Redeemable preferred stock 311,253   311,253 
Total stockholders’ deficit (113,387)  (81,467)
Total liabilities, mezzanine equity and stockholders’ deficit$355,827  $390,310 
    
Notes:   
(1) Derived from our Audited Consolidated Financial Statements   


STANDARD BIOTOOLS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
    
 Six Months Ended June 30,
 2023 2022
Operating activities   
Net loss$(33,883) $(139,827)
Loss on forward sale of Series B Preferred Stock —   60,081 
Loss on bridge loans —   13,719 
Stock-based compensation expense 6,262   8,705 
Amortization of developed technology 5,600   5,928 
Depreciation and amortization 1,688   1,878 
Provision for excess and obsolete inventory 572   4,597 
Impairment of intangible assets —   3,526 
Amortization of debt discounts, premiums and issuance costs 410   423 
Other non-cash items (168)  176 
Changes in assets and liabilities, net 1,705   (4,784)
Net cash used in operating activities (17,814)  (45,578)
    
Investing activities   
Purchases of short-term investments (6,836)  (137,302)
Proceeds from sales and maturities of investments 91,964   — 
Purchases of property and equipment (1,848)  (1,806)
Net cash provided by (used in) investing activities 83,280   (139,108)
    
Financing activities   
Proceeds from bridge loans —   25,000 
Proceeds from issuance of Series B Preferred Stock —   225,000 
Repayment of advances under revolving credit facility —   (6,838)
Payment of equity issuance costs —   (12,547)
Repurchase of common stock (4,841)  — 
Proceeds from ESPP stock issuance 326   497 
Payments for taxes related to net share settlement of equity awards and other (127)  (79)
Net cash provided by (used in) financing activities (4,642)  231,033 
Effect of foreign exchange rate fluctuations on cash and cash equivalents (49)  (437)
Net increase in cash, cash equivalents and restricted cash 60,775   45,910 
Cash, cash equivalents and restricted cash at beginning of period 82,324   29,467 
Cash, cash equivalents and restricted cash at end of period$143,099  $75,377 
    
Cash, cash equivalents, and restricted cash consists of:   
Cash and cash equivalents$142,304  $74,361 
Restricted cash 795   1,016 
Total cash, cash equivalents and restricted cash$143,099  $75,377 


STANDARD BIOTOOLS INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
(In thousands, except percentages)
(Unaudited)
        
        
ITEMIZED RECONCILIATION OF GAAP TO NON-GAAP GROSS PROFIT AND GROSS MARGIN PERCENTAGE
        
 Three Months Ended Six Months Ended
 June 30, 
2023		 June 30, 
2022		 June 30, 
2023		 June 30, 
2022
GAAP gross profit$13,602  $4,427  $25,939  $16,664 
Amortization of developed technology 2,800   2,641   5,600   5,608 
Depreciation and amortization 335   319   658   634 
Stock-based compensation expense 107   164   460   305 
Non-GAAP gross profit$16,844  $7,551  $32,657  $23,211 
        
GAAP gross margin percentage 49.2%  23.6%  49.1%  36.8%
Amortization of developed technology 10.1%  14.0%  10.6%  12.4%
Depreciation and amortization 1.2%  1.7%  1.3%  1.4%
Stock-based compensation expense 0.4%  0.9%  0.9%  0.7%
Non-GAAP gross margin percentage 60.9%  40.2%  61.9%  51.3%
        
        
        
ITEMIZED RECONCILIATION OF GAAP TO NON-GAAP OPERATING EXPENSES
        
 Three Months Ended Six Months Ended
 June 30, 
2023		 June 30, 
2022		 June 30, 
2023		 June 30, 
2022
GAAP operating expenses$31,051  $42,990  $59,981  $82,730 
Restructuring and related charges (2,267)  (300)  (3,417)  (1,690)
Stock-based compensation expense (3,007)  (4,499)  (5,802)  (8,400)
Depreciation and amortization (491)  (877)  (1,030)  (1,565)
Impairment of intangible assets —   (3,526)  —   (3,526)
Loss on disposal of property and equipment (73)  (6)  (73)  (15)
Non-GAAP operating expenses$25,213  $33,782  $49,659  $67,534 
        
        
GAAP R&D operating expenses$6,184  $12,606  $12,669  $21,471 
Stock-based compensation expense (366)  (705)  (782)  (1,404)
Depreciation and amortization (131)  (155)  (281)  (337)
Impairment of intangible assets —   (3,526)  —   (3,526)
Non-GAAP R&D operating expenses$5,687  $8,220  $11,606  $16,204 
        
GAAP SG&A operating expenses$22,600  $30,084  $43,895  $59,569 
Stock-based compensation expense (2,641)  (3,794)  (5,020)  (6,996)
Depreciation and amortization (360)  (722)  (749)  (1,228)
Loss on disposal of property and equipment (73)  (6)  (73)  (15)
Non-GAAP SG&A operating expenses$19,526  $25,562  $38,053  $51,330 


STANDARD BIOTOOLS INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
(In thousands)
(Unaudited)
        
        
ITEMIZED RECONCILIATION OF GAAP NET LOSS TO NON-GAAP ADJUSTED EBITDA
        
 Three Months Ended Six Months Ended
 June 30, 
2023		 June 30, 
2022		 June 30, 
2023		 June 30, 
2022
GAAP net loss$(17,040) $(63,539) $(33,883) $(139,827)
Income tax expense (benefit) 301   (1,613)  564   (2,187)
Interest expense 1,129   1,062   2,246   2,092 
Amortization of developed technology 2,800   2,961   5,600   5,928 
Depreciation and amortization 826   875   1,688   1,878 
Restructuring and related charges 2,267   300   3,417   1,690 
Stock-based compensation expense 3,114   4,663   6,262   8,705 
Impairment of intangible assets —   3,526   —   3,526 
Loss on forward sale of Series B Preferred Stock —   22,289   —   60,081 
Loss on bridge loans —   3,064   —   13,719 
Other non-operating expense (income) (1,839)  174   (2,969)  56 
Loss on disposal of property and equipment 73   6   73   15 
Non-GAAP adjusted EBITDA$(8,369) $(26,232) $(17,002) $(44,324)
        
        
        
CALCULATION OF OPERATING CASH USE
        
 Three Months Ended Six Months Ended
 June 30, 
2023		 June 30, 
2022		 June 30, 
2023		 June 30, 
2022
Net cash used in operating activities (1)$(9,329) $(29,988) $(17,814) $(45,578)
Purchases of property and equipment (838)  (938)  (1,848)  (1,806)
Cash paid for interest 1,687   1,577   1,919   1,679 
Operating cash use$(8,480) $(29,349) $(17,743) $(45,705)
        
        
Notes:       
(1) Derived from our Condensed Consolidated Statements of Cash Flows