UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the quarterly period ended
For the transition period from to .
Commission File Number:
(Exact name of Registrant as specified in its charter)
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(State or other jurisdiction of |
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(I.R.S. Employer |
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(Registrant’s address of principal executive offices
and telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading Symbol |
Name of each exchange on which registered |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
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Accelerated filer |
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Smaller reporting company |
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Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
There were
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This filing contains forward-looking statements. All statements other than statements of historical facts contained in this report, including statements regarding our future results of operations and financial position, future revenue, business strategy, prospects, products, research and development costs, timing and likelihood of success, as well as plans and objectives of management for future operations, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that are in some cases beyond our control and may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
The words “anticipate,” “believe,” contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will” or “would” or the negative of these terms or other similar expressions are intended to identify forward-looking statements. Forward-looking statements contained in this report include, but are not limited to, statements about:
These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in the section titled “Risk Factors” elsewhere in this report. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this report may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
You should not rely on forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, advancements, discoveries, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover, except as required by law, neither we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. We undertake no obligation to update publicly any forward-looking statements for any reason after the date of this report to conform these statements to actual results or to changes in our expectations.
You should read this report and the documents that we reference in this report and have filed with the Securities and Exchange Commission as exhibits to this report with the understanding that our actual future results, levels of activity, performance and events and circumstances may be materially different from what we expect.
2
Summary of Material Risks Associated with Our Business
Our business is subject to a number of risks that if realized could materially affect our business, prospects, operating results and financial condition. These risks are discussed more fully in the “Risk Factors” section elsewhere in this report. These risks include the following:
Trademarks and Trade Names
Singular Genomics®, G4®, G4X and our other logos and trademarks are the property of Singular Genomics Systems, Inc. All other brand names or trademarks appearing in this report are the property of their respective holders. Our use or display of other parties’ trademarks, trade dress or products in this report does not imply that we have a relationship with, or the endorsement or sponsorship of, the trademark or trade dress owners.
3
TABLE OF CONTENTS
4
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Singular Genomics Systems, Inc.
Balance Sheets
(In thousands, except share and par value amounts)
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September 30, |
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December 31, |
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2024 |
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2023 |
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(Unaudited) |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Short-term investments |
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Accounts receivable |
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Inventory, net |
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Prepaid expenses and other current assets |
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Total current assets |
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Right-of-use lease assets |
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Property and equipment, net |
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Restricted cash |
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Other noncurrent assets |
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Total assets |
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$ |
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$ |
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Liabilities and Stockholders’ Equity |
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Current liabilities: |
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Accounts payable |
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$ |
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$ |
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Accrued expenses |
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Lease liabilities, current |
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Other current liabilities |
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Total current liabilities |
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Lease liabilities, noncurrent |
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Long-term debt, net of issuance costs |
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Other noncurrent liabilities |
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Total liabilities |
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Stockholders’ equity: |
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Series A common stock equivalent convertible preferred stock, $ |
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Common stock, $ |
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Additional paid-in capital |
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Accumulated other comprehensive gain |
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Accumulated deficit |
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( |
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( |
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Total stockholders’ equity |
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Total liabilities and stockholders’ equity |
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$ |
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$ |
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See accompanying notes to these unaudited financial statements.
2
Singular Genomics Systems, Inc.
Statements of Operations
(Unaudited)
(In thousands, except share and per share amounts)
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Three Months Ended September 30, |
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Nine Months Ended September 30, |
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2024 |
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2023 |
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2024 |
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2023 |
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Revenue |
$ |
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$ |
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$ |
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$ |
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Cost of revenue |
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Gross margin |
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( |
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( |
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( |
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( |
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Operating expenses: |
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Research and development |
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Selling, general and administrative |
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Total operating expenses |
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Loss from operations |
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( |
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( |
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( |
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( |
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Other income (expense): |
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Interest income |
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Interest expense |
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( |
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( |
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( |
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( |
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Total other income |
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Net loss |
$ |
( |
) |
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$ |
( |
) |
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$ |
( |
) |
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$ |
( |
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Net loss per share: |
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Basic and diluted net loss per share |
$ |
( |
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$ |
( |
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$ |
( |
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$ |
( |
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Weighted-average shares used to compute basic and diluted net loss per share |
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See accompanying notes to these unaudited financial statements.
3
Singular Genomics Systems, Inc.
Statements of Comprehensive Loss
(Unaudited)
(In thousands)
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Three Months Ended September 30, |
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Nine Months Ended September 30, |
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2024 |
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2023 |
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2024 |
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2023 |
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Net loss |
$ |
( |
) |
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$ |
( |
) |
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$ |
( |
) |
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$ |
( |
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Other comprehensive loss: |
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Unrealized gain (loss) on available-for-sale securities |
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( |
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Comprehensive loss |
$ |
( |
) |
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$ |
( |
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$ |
( |
) |
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$ |
( |
) |
See accompanying notes to these unaudited financial statements.
4
Singular Genomics Systems, Inc.
Statements of Preferred Stock and Stockholders’ Equity
(Unaudited)
(In thousands, except share data)
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Preferred Stock |
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Common Stock |
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Additional |
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Accumulated |
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Accumulated |
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Total |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Gain (Loss) |
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Deficit |
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Equity |
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Balance at December 31, 2023 |
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- |
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( |
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Vesting of common stock issued for early exercise of stock options |
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- |
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- |
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- |
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- |
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- |
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Issuance of common stock in connection with vesting of restricted stock units |
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- |
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- |
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- |
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- |
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- |
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- |
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- |
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Stock-based compensation |
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- |
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- |
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- |
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- |
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- |
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- |
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Unrealized loss on available-for-sale securities |
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- |
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- |
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- |
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- |
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- |
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( |
) |
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- |
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( |
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Net loss |
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- |
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- |
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- |
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- |
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- |
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- |
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( |
) |
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( |
) |
Balance at March 31, 2024 |
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- |
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( |
) |
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( |
) |
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Vesting of common stock issued for early exercise of stock options |
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- |
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- |
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- |
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- |
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- |
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Issuance of common stock in connection with vesting of restricted stock units |
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- |
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- |
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- |
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- |
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- |
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- |
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- |
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Issuance of common stock in connection with employee stock purchase plan |
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- |
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- |
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- |
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- |
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- |
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Reverse stock split adjustments |
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- |
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- |
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( |
) |
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- |
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- |
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- |
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Stock-based compensation |
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- |
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- |
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- |
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- |
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- |
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- |
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Unrealized loss on available-for-sale securities |
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- |
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- |
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- |
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- |
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- |
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( |
) |
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- |
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( |
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Net loss |
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- |
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- |
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- |
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- |
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- |
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- |
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( |
) |
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( |
) |
Balance at June 30, 2024 |
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- |
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- |
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( |
) |
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( |
) |
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Vesting of common stock issued for early exercise of stock options |
|
- |
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- |
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- |
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- |
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- |
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Issuance of common stock in connection with vesting of restricted stock units |
|
- |
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- |
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- |
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- |
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- |
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- |
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- |
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Stock-based compensation |
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- |
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- |
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- |
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- |
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- |
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- |
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Unrealized gain on available-for-sale marketable securities |
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- |
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- |
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- |
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- |
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- |
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- |
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Net loss |
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- |
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- |
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- |
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- |
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- |
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- |
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( |
) |
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( |
) |
Balance at September 30, 2024 |
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- |
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- |
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( |
) |
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5
Singular Genomics Systems, Inc.
Statements of Preferred Stock and Stockholders’ Equity (continued)
(Unaudited)
(In thousands, except share data)
|
Preferred Stock |
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Common Stock |
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Additional |
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Accumulated |
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Accumulated |
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Total |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Loss |
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Deficit |
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Equity |
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Balance at December 31, 2022 |
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$ |
- |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
) |
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$ |
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Vesting of common stock issued for early exercise of stock options |
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- |
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- |
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- |
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- |
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- |
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Issuance of common stock in connection with exercise of stock options |
|
- |
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- |
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- |
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- |
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- |
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Stock-based compensation |
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- |
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- |
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- |
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- |
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- |
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- |
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Unrealized gain on available-for-sale securities |
|
- |
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- |
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- |
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- |
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|
- |
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- |
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||
Net loss |
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- |
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- |
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- |
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- |
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- |
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- |
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( |
) |
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( |
) |
Balance at March 31, 2023 |
|
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$ |
- |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
) |
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$ |
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|||||
Vesting of common stock issued for early exercise of stock options |
|
- |
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- |
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- |
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- |
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- |
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|||
Issuance of common stock in connection with exercise of stock options |
|
- |
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- |
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- |
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- |
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- |
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- |
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- |
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|
Issuance of common stock in connection with vesting of restricted stock units |
|
- |
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- |
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- |
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- |
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- |
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- |
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- |
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Issuance of common stock in connection with employee stock purchase plan |
|
- |
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- |
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- |
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- |
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- |
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|||
Stock-based compensation |
|
- |
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- |
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- |
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- |
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- |
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- |
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Unrealized gain on available-for-sale securities |
|
- |
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- |
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- |
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- |
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- |
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- |
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||
Net loss |
|
- |
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- |
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- |
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- |
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- |
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- |
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( |
) |
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( |
) |
Balance at June 30, 2023 |
|
|
$ |
- |
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|
$ |
|
|
$ |
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|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
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|||||
Vesting of common stock issued for early exercise of stock options |
|
- |
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- |
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- |
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- |
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- |
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91 |
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||
Issuance of common stock in connection with exercise of stock options |
|
- |
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- |
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- |
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- |
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- |
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- |
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- |
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- |
|
Issuance of common stock in connection with vesting of restricted stock units |
|
- |
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- |
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- |
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- |
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|
|
- |
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|
|
- |
|
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- |
|
|
Issuance of common stock in connection with employee stock purchase plan |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Stock-based compensation |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
||
Unrealized gain on available-for-sale securities |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
||
Net loss |
|
- |
|
|
- |
|
|
|
- |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Balance at September 30, 2023 |
|
|
$ |
- |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|||||
See accompanying notes to these unaudited financial statements.
6
Singular Genomics Systems, Inc.
Statements of Cash Flows
(Unaudited)
(In thousands)
|
Nine Months Ended September 30, |
|
|||||
|
2024 |
|
|
2023 |
|
||
Operating activities |
|
|
|
|
|
||
Net loss |
$ |
( |
) |
|
$ |
( |
) |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
|
|
||
Stock-based compensation |
$ |
|
|
$ |
|
||
Depreciation |
|
|
|
|
|
||
Amortization of right-of-use lease assets |
|
|
|
|
|
||
Gain on lease modification |
|
( |
) |
|
|
|
|
Accretion of discount on short-term investments |
|
( |
) |
|
|
( |
) |
Long-lived asset impairment |
|
|
|
|
|
||
Accretion of debt issuance costs |
|
|
|
|
|
||
Lease incentives received |
|
|
|
|
|
||
Changes in operating assets and liabilities: |
|
|
|
|
|
||
Accounts receivable |
|
|
|
|
|
||
Inventory, net |
|
( |
) |
|
|
( |
) |
Prepaid expenses and other current assets |
|
|
|
|
|
||
Other noncurrent assets |
|
|
|
|
|
||
Accounts payable |
|
( |
) |
|
|
( |
) |
Accrued expenses |
|
( |
) |
|
|
|
|
Other current liabilities |
|
( |
) |
|
|
|
|
Lease liabilities |
|
( |
) |
|
|
( |
) |
Other noncurrent liabilities |
|
|
|
|
|
||
Net cash used in operating activities |
|
( |
) |
|
|
( |
) |
Investing activities |
|
|
|
|
|
||
Purchases of short-term investments |
|
( |
) |
|
|
( |
) |
Maturities of short-term investments |
|
|
|
|
|
||
Sales of short-term investments |
|
|
|
|
|
||
Purchases of property and equipment |
|
( |
) |
|
|
( |
) |
Net cash provided by investing activities |
|
|
|
|
|
||
Financing activities |
|
|
|
|
|
||
Proceeds from issuance of common stock under employee stock purchase plan |
|
|
|
|
|
||
Proceeds from issuance of common stock under equity incentive plans |
|
|
|
|
|
||
Repurchases of common stock under equity incentive plans |
|
|
|
|
( |
) |
|
Net cash provided by financing activities |
|
|
|
|
|
||
Net increase in cash and cash equivalents and restricted cash |
|
|
|
|
( |
) |
|
Cash and cash equivalents and restricted cash, beginning of year |
|
|
|
|
|
||
Cash and cash equivalents and restricted cash, end of year |
$ |
|
|
$ |
|
||
|
|
|
|
|
|
||
Supplemental disclosure for cash activities |
|
|
|
|
|
||
Interest paid |
$ |
|
|
$ |
|
||
Supplemental disclosure for non-cash activities |
|
|
|
|
|
||
Increase (decrease) in lease liability on lease modifications |
$ |
( |
) |
|
$ |
|
|
Inventory transferred to property and equipment |
$ |
|
|
$ |
|
||
Purchases of property and equipment included in accounts payable |
$ |
|
|
$ |
|
||
Purchases of inventory included in accounts payable |
$ |
|
|
$ |
|
||
Vesting of common stock issued for early exercise of stock options |
$ |
|
|
$ |
|
||
See accompanying notes to these unaudited financial statements.
7
Singular Genomics Systems, Inc.
Notes to Financial Statements
(Unaudited)
1. Business
Description of Business
Singular Genomics Systems, Inc. (the “Company”) is a life science technology company that develops next-generation sequencing and multiomics technologies. The commercially available G4 Sequencing Platform is a powerful, highly versatile benchtop genomic sequencer designed to produce fast and accurate results. In addition, the Company is currently developing the G4X Spatial Sequencer, which will leverage the Company’s proprietary sequencing technology, applying it as an in situ readout for transcriptomics, proteomics and fluorescent H&E in tissue, with spatial context and on the same platform as the G4. The Company’s mission is to empower researchers and clinicians to advance science and medicine.
The Company was incorporated in the state of Delaware in June 2016 and has its principal operations in San Diego, California.
Liquidity and Capital Resources
The Company has incurred net losses since inception and, as of September 30, 2024 and December 31, 2023, had an accumulated deficit of $
2. Basis of Presentation and Summary of Significant Accounting Policies
Basis of Presentation and Use of Estimates
The accompanying unaudited financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, certain information and disclosures required by GAAP for annual financial statements have been omitted. In the opinion of management, all adjustments, consisting of normal recurring adjustments considered necessary for fair presentation, have been included. Interim financial results are not necessarily indicative of results anticipated for the full year.
The preparation of the Company’s unaudited financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities and expenses and the disclosure of contingent assets and liabilities in the Company’s unaudited financial statements and accompanying notes. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may significantly differ from these estimates and assumptions. For the year ended December 31, 2023, significant estimates and assumptions include the value of lease liabilities and right-of-use lease assets. There were no changes to the Company's significant estimates and assumptions subsequent to December 31, 2023.
On June 25, 2024, the Company filed a certificate of amendment (the “Reverse Stock Split Amendment”) to the Company’s Amended and Restated Certificate of Incorporation with the Secretary of State of Delaware to effect a 1-for-30 reverse stock split of its common stock (the “Reverse Stock Split”), which became effective at 12:01 a.m. Eastern Time on June 26, 2024. The Reverse Stock Split Amendment does not reduce the number of authorized shares of common stock, which remains at
Summary of Significant Accounting Policies
During the nine months ended September 30, 2024, other than the policies described below, there were no changes to the Company’s significant accounting policies as described in Note 2 to the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
8
Cash, Cash Equivalents and Restricted Cash
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the balance sheets (in thousands):
|
|
September 30, |
|
|
December 31, |
|
||
|
|
2024 |
|
|
2023 |
|
||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Restricted cash |
|
|
|
|
|
|
||
Total |
|
$ |
|
|
$ |
|
||
Short-term Investments
Short-term investments consisted of U.S. treasury securities at September 30, 2024 and U.S. treasury securities, corporate debt securities and asset-backed securities at December 31, 2023. The Company’s investments in securities are classified as current as they are available for use in current operations.
|
September 30, 2024 |
|
|||||||||
|
Amortized |
|
|
Gross |
|
|
Estimated |
|
|||
U.S. treasury securities |
$ |
|
|
$ |
|
|
$ |
|
|||
Total |
$ |
|
|
$ |
|
|
$ |
|
|||
|
December 31, 2023 |
|
|||||||||
|
Amortized |
|
|
Gross |
|
|
Estimated |
|
|||
U.S. treasury securities |
$ |
|
|
$ |
|
|
$ |
|
|||
Corporate debt securities |
|
|
|
|
( |
) |
|
|
|
||
Asset-backed securities |
|
|
|
|
|
|
|
|
|||
Total |
$ |
|
|
$ |
|
|
$ |
|
|||
The following table summarizes the estimated fair value of contractual maturities of available-for-sale debt securities held by the Company at September 30, 2024 and December 31, 2023 (in thousands):
|
|
September 30, |
|
|
December 31, |
|
||
|
|
2024 |
|
|
2023 |
|
||
Due within one year |
|
$ |
|
|
$ |
|
||
Due after one but within five years |
|
|
|
|
|
|
||
Total |
|
$ |
|
|
$ |
|
||
As of September 30, 2024, the Company considered the nature and number of available-for-sale debt securities in an unrealized loss position. The Company reviews its portfolio of available-for-sale debt securities at least quarterly to determine if any investment is impaired, whether due to changes in credit risk or other potential valuation concerns. There were no unrealized losses on available-for-sale debt securities at September 30, 2024.
Revenue Recognition
The Company generates revenue from sales of its products, which currently consist of the G4 instrument, related consumable flow cell kits and services. Revenue from instrument sales is recognized generally upon customer acceptance. Revenue from consumables sales is recognized generally upon shipment to the customer. Revenue from services, which are primarily comprised of assurance-type services, is recognized over the applicable service period.
9
Revenue is recorded net of discounts and sales taxes. The Company invoices its customers for instruments generally upon acceptance, for consumables generally on delivery, and for services generally in advance of the service period. Invoice terms are generally net 30 days. Cash received from customers in advance of revenue recognition is recorded as a contract liability. The Company’s contracts with its customers generally do not include rights of return or a significant financing component.
The Company periodically enters into contracts that include a combination of products and services, which are distinct within the context of the contract and are accounted for as separate performance obligations. The transaction price is allocated to each performance obligation in proportion to its standalone selling price. Until the Company has sufficient volume of historical sales data for each performance obligation, the Company determines the standalone selling price using observable prices when available and with consideration of current market conditions, which is primarily based on prices set by management, adjusted for applicable discounts. The Company then recognizes revenue for each performance obligation as that performance obligations is satisfied, as discussed above.
The Company has entered into instrument arrangements with certain customers, under which the Company provides the G4 instrument at no cost to the customer, other than shipping, and the customer pays for consumables at list price, or at list price plus a mark-up, as consumables are ordered, shipped and invoiced. Revenue is recognized as consumables are shipped to the customer and disclosed within consumables revenue below. The G4 instrument provided to the customer is recorded on the balance sheet as property and equipment and disclosed as instruments at customer sites under Note 6 to these financial statements. Depreciation expense for these instruments is included in cost of revenue. Revenue associated with any lease elements of these arrangements was not material during the three and nine months ended September 30, 2024 and 2023.
During the nine months ended September 30, 2024, the Company recognized $
For the nine months ended September 30, 2024, all of the Company’s revenue was generated within the United States, and the Company generated approximately
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentration of credit risk consist of cash, restricted cash, cash equivalents and short-term investments. The Company invests its cash equivalents in highly rated money market funds. The Company’s short-term investments consisted of U.S. treasury securities as of September 30, 2024. Deposits may exceed federally insured limits, and the Company is exposed to credit risk on deposits with financial institutions to the extent account balances exceed the amount insured by the Federal Deposit Insurance Corporation (“FDIC”). During the periods presented, the Company has not experienced any losses on its cash, restricted cash, cash equivalents or short-term investments.
Long-lived Asset Impairment
Long-lived assets consist primarily of right-of-use lease assets and property and equipment. During the year ended December 31, 2023, the Company identified an indicator of impairment of its long-lived assets due to a sustained decline in the trading price of the Company’s common stock over the preceding year, resulting in the Company’s market capitalization being below its net asset value. Although the Company is confident in the utility of its long-lived assets, and there have been no changes in their intended use, the implied cash flows based on the market capitalization of the Company indicated its long-lived assets may not be recoverable. This indicator of impairment continued to exist as of September 30, 2024. In determining the fair value of its long-lived assets, the Company uses a combination of discounted cash flows and observable market data. The Company recorded $
Recent Accounting Pronouncements
There were no additions to the new accounting pronouncements not yet adopted as described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.
Other amendments to GAAP that have been issued by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on our financial statements upon adoption.
10
3. Fair Value Measurements
For accounting purposes, fair value is defined as an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:
Level 1: Observable inputs such as quoted prices in active markets.
Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly.
Level 3: Unobservable inputs where there is little or no market data, which require the reporting entity to develop its own assumptions.
When quoted market prices are available in active markets, the fair value of assets and liabilities is estimated within Level 1 of the valuation hierarchy. If quoted prices are not available, then fair values are estimated by using pricing models, quoted prices of assets and liabilities with similar characteristics, or discounted cash flows, within Level 2 of the valuation hierarchy. In cases where Level 1 or Level 2 inputs are not available, the fair values are estimated by using inputs within Level 3 of the hierarchy.
None of the Company’s assets or liabilities are recorded at fair value on a recurring basis other than cash, cash equivalents and short-term investments. No transfers between levels occurred during the periods presented. The fair value of short-term investments is based on market prices quoted on the last day of the fiscal period or other observable market inputs.
The following tables summarize the Company’s assets measured at fair value on a recurring basis as of September 30, 2024 and December 31, 2023 (in thousands):
|
|
September 30, 2024 |
|
|||||||||||||
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
||||
Cash and cash equivalents: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash |
|
$ |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
|
||
Money market funds |
|
|
|
|||||||||||||