Company Quick10K Filing
Quick10K
Quanterix
Closing Price ($) Shares Out (MM) Market Cap ($MM)
$27.22 23 $615
10-Q 2019-06-30 Quarter: 2019-06-30
10-Q 2019-03-31 Quarter: 2019-03-31
10-K 2018-12-31 Annual: 2018-12-31
10-Q 2018-09-30 Quarter: 2018-09-30
10-Q 2018-06-30 Quarter: 2018-06-30
10-Q 2018-03-31 Quarter: 2018-03-31
10-K 2017-12-31 Annual: 2017-12-31
8-K 2019-08-08 Enter Agreement, Other Events, Exhibits
8-K 2019-08-06 Earnings, Exhibits
8-K 2019-07-29 Officers, Exhibits
8-K 2019-07-25 Shareholder Vote, Other Events, Exhibits
8-K 2019-07-01 M&A, Sale of Shares, Exhibits
8-K 2019-06-26 Enter Agreement, Sale of Shares, Other Events, Exhibits
8-K 2019-06-04 Other Events, Exhibits
8-K 2019-05-09 Earnings, Exhibits
8-K 2019-04-15 Enter Agreement, Exhibits
8-K 2019-03-27 Officers, Exhibits
8-K 2019-03-19 Enter Agreement
8-K 2019-03-07 Earnings, Exhibits
8-K 2018-11-12 Leave Agreement
8-K 2018-11-01 Earnings, Exhibits
8-K 2018-10-02 Enter Agreement, Off-BS Arrangement, Exhibits
8-K 2018-09-06 Leave Agreement, Exhibits
8-K 2018-08-29 Enter Agreement, Leave Agreement
8-K 2018-08-08 Earnings, Exhibits
8-K 2018-06-13 Shareholder Vote
8-K 2018-05-09 Earnings, Exhibits
8-K 2018-03-14 Earnings, Exhibits
8-K 2018-01-10 Earnings, Exhibits
MTD Mettler Toledo 16,033
BIO Bio-Rad Laboratories 10,088
PKI Perkinelmer 8,906
BRKR Bruker 6,632
COHR Coherent 3,726
AXDX Accelerate Diagnostics 1,055
HTGM HTG Molecular Diagnostics 27
BNGO Bionano Genomics 17
PRPO Precipio 15
AEMD Aethlon Medical 6
QTRX 2019-06-30
Part I — Financial Information
Item 1. Financial Statements
Item 2. Management’S Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II — Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-10.2 qtrx-20190630ex1024cae61.htm
EX-31.1 qtrx-20190630ex3116688b4.htm
EX-31.2 qtrx-20190630ex31290ec3c.htm
EX-32.1 qtrx-20190630ex32182bbe7.htm

Quanterix Earnings 2019-06-30

QTRX 10Q Quarterly Report

Balance SheetIncome StatementCash Flow

10-Q 1 qtrx-20190630x10q.htm 10-Q qtrx_Current_Folio_10Q_Taxonomy2018

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-Q


(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2019

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from            to           .

Commission File Number: 001‑38319


QUANTERIX CORPORATION

(Exact name of registrant as specified in its charter)


 

 

 

Delaware

 

20‑8957988

(State or other jurisdiction of incorporation or organization)

 

(IRS Employer Identification No.)

 

 

 

900 Middlesex Turnpike

 

 

Billerica, MA

 

01821

(Address of principal executive offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code: (617) 301‑9400

Securities registered pursuant to Section 12(b) of the Exchange Act:

 

 

 

 

 

Title of each class:

    

Trading Symbol(s)

    

Name of each exchange on which registered:

Common Stock, $0.001 par value per share

 

QTRX

 

The Nasdaq Global Market

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.    Yes      No 

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).   Yes      No  

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

 

Accelerated filer

Non-accelerated filer

 

Smaller reporting company

 

 

 

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 13(a) of the Exchange Act. 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b‑2 of the Exchange Act).   Yes    No

 

As of July 31, 2019, the registrant had 25,165,086 shares of common stock, $0.001 par value per share, outstanding.

 

 

 

TABLE OF CONTENTS

 

 

 

 

Page

 

 

PART I — FINANCIAL INFORMATION 

 

 

 

Special Note Regarding Forward-Looking Statements 

 

 

Item 1. Financial Statements 

4

Unaudited Condensed Consolidated Balance Sheets at June 30, 2019 and December 31, 2018 

4

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Six Months Ended June 30, 2019 and 2018 

5

Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2019 and 2018 

6

Unaudited Consolidated Statements of Stockholders’ Equity for the Three and Six Months Ended June 30, 2019 and 2018 

7

Notes to Condensed Consolidated Financial Statements 

8

 

 

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 

21

 

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk 

27

 

 

Item 4. Controls and Procedures 

27

 

 

PART II — OTHER INFORMATION 

 

 

 

Item 1. Legal Proceedings 

29

 

 

Item 1A. Risk Factors 

29

 

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 

29

 

 

Item 3. Defaults Upon Senior Securities 

30

 

 

Item 4. Mine Safety Disclosures 

30

 

 

Item 5. Other Information 

30

 

 

Item 6. Exhibits 

30

 

 

Signatures 

32

 

 

2

Special Note Regarding Forward-Looking Statements

 

This Quarterly Report on Form 10-Q contains forward-looking statements that involve risks and uncertainties. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q are forward-looking statements. In some cases, you can identify forward-looking statements by words such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will,” “would,” or the negative of these words or other comparable terminology. These forward-looking statements include, but are not limited to, statements about our financial performance, and are subject to a number of risks, uncertainties and assumptions, including those described in this Quarterly Report on Form 10-Q and in “Part I, Item 1A, Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2018 or other filings that we make with the Securities and Exchange Commission, or SEC. Moreover, we operate in a very competitive and rapidly changing environment, and 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 Quarterly Report on Form 10-Q 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 upon 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, levels of activity, performance, events or circumstances reflected in the forward-looking statements will be achieved or occur. You should read this Quarterly Report on Form 10-Q, and the documents that we reference herein and have filed with the SEC, with the understanding that our actual future results, levels of activity, performance, and events and circumstances may be materially different from what we expect. We undertake no obligation to update publicly any forward-looking statements for any reason after the date of this Quarterly Report on Form 10-Q to conform these statements to new information, actual results or to changes in our expectations, except as required by law.

 

Unless the context otherwise requires, the terms “Quanterix,” the “Company,” “we,” “us” and “our” in this Quarterly Report on Form 10-Q refer to Quanterix Corporation and its subsidiaries. “Quanterix,” “Simoa,” “Simoa HD-1,” “SR-X,” “HD-1 Analyzer,” “SP-X” and our logo are our trademarks. All other service marks, trademarks and trade names appearing in this Quarterly Report on Form 10-Q are the property of their respective owners. We do not intend our use or display of other companies’ trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, these other companies.

 

 

3

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

Quanterix Corporation

Condensed Consolidated Balance Sheets

(amounts in thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

    

(Unaudited)

    

 

 

    

June 30, 2019

    

December 31, 2018

Assets

 

 

 

 

 

 

Current assets:

 

 

  

 

 

  

Cash and cash equivalents

 

$

72,025

 

$

44,429

Accounts receivable (less reserve for doubtful accounts of $59 and $36 as of June 30, 2019 and December 31, 2018, respectively; including $95 and $48 from related parties as of June 30, 2019 and December 31, 2018, respectively)

 

 

9,134

 

 

6,792

Inventory

 

 

8,850

 

 

5,945

Prepaid expenses and other current assets

 

 

2,377

 

 

2,330

Total current assets

 

 

92,386

 

 

59,496

Restricted cash

 

 

1,026

 

 

1,000

Property and equipment, net

 

 

12,082

 

 

2,923

Intangible assets, net

 

 

2,054

 

 

2,348

Goodwill

 

 

1,308

 

 

1,308

Other non-current assets

 

 

552

 

 

536

Total assets

 

$

109,408

 

$

67,611

Liabilities and stockholders’ equity

 

 

  

 

 

  

Current liabilities:

 

 

  

 

 

  

Accounts payable (including $11 and $36 to related parties as of June 30, 2019 and December 31, 2018, respectively)

 

$

3,510

 

$

5,110

Accrued compensation and benefits

 

 

4,150

 

 

4,449

Other accrued expenses (including $207 and $226 to related parties as of June 30, 2019 and December 31, 2018, respectively)

 

 

4,019

 

 

3,129

Deferred revenue (including $17 and $33 with related parties as of June 30, 2019 and December 31, 2018, respectively)

 

 

5,186

 

 

5,437

Current portion of long term debt

 

 

75

 

 

 —

Other current liabilities

 

 

78

 

 

 —

Total current liabilities

 

 

17,018

 

 

18,125

Deferred revenue, net of current portion

 

 

374

 

 

520

Long term debt, net of current portion

 

 

7,544

 

 

7,623

Other non-current liabilities

 

 

9,727

 

 

278

Total liabilities

 

 

34,663

 

 

26,546

Commitments and contingencies (Note 10)

 

 

  

 

 

  

Stockholders’ equity:

 

 

  

 

 

  

Common stock, $0.001 par value:

 

 

  

 

 

  

Authorized—120,000,000 shares as of June 30, 2019 and December 31, 2018; issued and outstanding — 24,894,019 and 22,369,036 shares as of June 30, 2019 and December 31, 2018, respectively

 

 

25

 

 

22

Additional paid-in capital

 

 

270,136

 

 

216,931

Accumulated deficit

 

 

(195,416)

 

 

(175,888)

Total stockholders’ equity

 

 

74,745

 

 

41,065

Total liabilities and stockholders’ equity

 

$

109,408

 

$

67,611

 

See accompanying notes

4

Quanterix Corporation

Condensed Consolidated Statements of Operations and Comprehensive Loss

(amounts in thousands, except share and per share data)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 

 

Six Months Ended June 30, 

 

 

    

2019

    

2018

    

2019

    

2018

 

Product revenue (including related party activity of $126 and $43 for the three months ended June 30, 2019 and 2018, respectively, and $205 and $136 for the six months ended June 30, 2019 and 2018, respectively)

 

$

8,776

 

$

5,200

 

$

18,322

 

$

9,945

 

Service and other revenue (including related party activity of $19 and $58 for the three months ended June 30, 2019 and 2018, respectively, and $42 and $97 for the six months ended June 30, 2019 and 2018, respectively)

 

 

4,760

 

 

3,174

 

 

7,550

 

 

5,682

 

Collaboration and license revenue (including related party activity of $0 and $269 for the three months ended June 30, 2019 and 2018, respectively, and $0 and $537 for the six months ended June 30, 2019 and 2018, respectively)

 

 

 —

 

 

269

 

 

 —

 

 

537

 

Total revenue

 

 

13,536

 

 

8,643

 

 

25,872

 

 

16,164

 

Costs of goods sold:

 

 

 

 

 

 

 

 

 

 

 

  

 

Cost of product revenue (including related party activity of $35 and $47 for the three months ended June 30, 2019 and 2018, respectively, and $70 and $122 for the six months ended June 30, 2019 and 2018, respectively; including stock compensation of $27 and $19 for the three months ended June 30, 2019 and 2018, respectively, and $44 and $29 for the six months ended June 30, 2019 and 2018, respectively)

 

 

4,455

 

 

2,945

 

 

8,704

 

 

5,718

 

Cost of services and other revenue (including stock compensation of $57 and $51 for the three months ended June 30, 2019 and 2018, respectively, and $117 and $83 for the six months ended June 30, 2019 and 2018, respectively)

 

 

2,150

 

 

1,725

 

 

4,232

 

 

3,301

 

Total costs of goods sold and services

 

 

6,605

 

 

4,670

 

 

12,936

 

 

9,019

 

Gross profit

 

 

6,931

 

 

3,973

 

 

12,936

 

 

7,145

 

Operating expense:

 

 

 

 

 

 

 

 

 

 

 

  

 

Research and development (including stock compensation of $180 and $138 for the three months ended June 30, 2019 and 2018, respectively, and $348 and $209 for the six months ended June 30, 2019 and 2018, respectively)

 

 

4,016

 

 

3,705

 

 

7,868

 

 

7,349

 

Selling, general and administrative (including stock compensation of $1,337 and $682 for the three months ended June 30, 2019 and 2018, respectively, and $2,376 and $1,205 for the six months ended June 30, 2019 and 2018, respectively)

 

 

13,429

 

 

7,579

 

 

24,941

 

 

14,271

 

Total operating expenses

 

 

17,445

 

 

11,284

 

 

32,809

 

 

21,620

 

Loss from operations

 

 

(10,514)

 

 

(7,311)

 

 

(19,873)

 

 

(14,475)

 

Interest income (expense), net

 

 

42

 

 

16

 

 

64

 

 

(9)

 

Other income (expense), net

 

 

(68)

 

 

(48)

 

 

(115)

 

 

(61)

 

Loss before income tax

 

 

(10,540)

 

 

(7,343)

 

 

(19,924)

 

 

(14,545)

 

Income tax provision

 

 

23

 

 

 —

 

 

44

 

 

 —

 

Net loss

 

$

(10,563)

 

$

(7,343)

 

$

(19,968)

 

$

(14,545)

 

Net loss per share, basic and diluted

 

$

(0.46)

 

$

(0.34)

 

$

(0.88)

 

$

(0.67)

 

Weighted-average common shares outstanding, basic and diluted

 

 

23,213,653

 

 

21,890,978

 

 

22,820,502

 

 

21,840,074

 

 

See accompanying notes

5

Quanterix Corporation

Condensed Consolidated Statements of Cash Flows

(amounts in thousands)

(Unaudited)

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 

 

 

2019

    

2018

Operating activities

 

 

  

 

 

  

Net loss

 

$

(19,968)

 

$

(14,545)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

  

Depreciation and amortization expense

 

 

953

 

 

609

Stock-based compensation expense

 

 

2,885

 

 

1,526

Non-cash interest expense

 

 

46

 

 

99

Loss on disposal of fixed assets

 

 

14

 

 

 —

Changes in operating assets and liabilities:

 

 

 

 

 

  

Accounts receivable

 

 

(2,296)

 

 

2,223

Prepaid expenses and other assets

 

 

302

 

 

(681)

Inventory

 

 

(2,905)

 

 

(1,087)

Other non-current assets

 

 

 2

 

 

 —

Accounts payable

 

 

(1,600)

 

 

(626)

Accrued compensation and benefits, other accrued expenses and other current liabilities

 

 

669

 

 

(957)

Contract acquisition costs

 

 

(60)

 

 

 —

Other non-current liabilities

 

 

9,448

 

 

 —

Deferred revenue

 

 

(310)

 

 

(531)

Net cash used in operating activities

 

 

(12,820)

 

 

(13,970)

Investing activities

 

 

  

 

 

  

Purchases of property and equipment

 

 

(9,830)

 

 

(690)

Acquisitions, net of cash acquired

 

 

 —

 

 

(3,001)

Net cash used in investing activities

 

 

(9,830)

 

 

(3,691)

Financing activities

 

 

  

 

 

  

Proceeds from sale of common stock, net of issuance costs

 

 

 —

 

 

(53)

Proceeds from stock options exercised

 

 

1,910

 

 

381

Net proceeds from at-the-market offering

 

 

48,019

 

 

 —

Proceeds from ESPP purchase

 

 

393

 

 

 —

Payments on notes payable

 

 

(50)

 

 

(1,875)

Net cash provided by (used in) financing activities

 

 

50,272

 

 

(1,547)

Net increase (decrease) in cash and cash equivalents

 

 

27,622

 

 

(19,208)

Cash, restricted cash, and cash equivalents at beginning of period

 

 

45,429

 

 

79,682

Cash, restricted cash, and cash equivalents at end of period

 

$

73,051

 

$

60,474

Supplemental cash flow information

 

 

  

 

 

  

Cash paid for interest

 

$

160

 

$

347

Purchases of property and equipment included in accounts payable

 

$

279

 

$

29

Purchases of property and equipment included in other non-current liabilities

 

$

8,057

 

$

 —

Reconciliation of cash, cash equivalents, and restricted cash:

 

 

 

 

 

 

Cash and cash equivalents

 

$

72,025

 

$

60,474

Restricted cash

 

$

1,026

 

$

 —

Total cash, cash equivalents, and restricted cash

 

$

73,051

 

$

60,474

 

See accompanying notes

6

Quanterix Corporation

Condensed Consolidated Statements of Stockholders’ Equity

(amounts in thousands, except share data)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional paid-in

 

 

 

 

Total stockholders’

 

    

Common stock shares

    

Common stock value

    

capital

    

Accumulated deficit

    

equity

Balance at March 31, 2019

 

22,491,447

 

$

23

 

$

219,045

 

$

(184,853)

 

$

34,215

Exercise of common stock warrants

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

Exercise of common stock options and vesting of restricted stock

 

216,409

 

 

 —

 

 

1,408

 

 

 —

 

 

1,408

Sale of common stock in at-the-market offering

 

2,186,163

 

 

 2

 

 

48,017

 

 

 —

 

 

48,019

ESPP stock purchase

 

 —

 

 

 —

 

 

65

 

 

 —

 

 

65

Stock-based compensation expense

 

 —

 

 

 —

 

 

1,601

 

 

 —

 

 

1,601

Net loss

 

 —

 

 

 —

 

 

 —

 

 

(10,563)

 

 

(10,563)

Balance at June 30, 2019

 

24,894,019

 

$

25

 

$

270,136

 

$

(195,416)

 

$

74,745

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional paid-in

 

 

 

 

Total stockholders’ 

 

    

Common stock shares

    

Common stock value

    

capital

    

Accumulated deficit

    

equity

Balance at March 31, 2018

 

21,823,282

 

 

22

 

 

210,863

 

 

(151,554)

 

 

59,331

Exercise of common stock options and vesting of restricted stock

 

157,399

 

 

 —

 

 

297

 

 

 —

 

 

297

Stock-based compensation expense

 

 

 

 

 

890

 

 

 —

 

 

890

Net loss

 

 

 

 

 

 

 

(7,343)

 

 

(7,343)

Balance at June 30, 2018

 

21,980,681

 

$

22

 

$

212,050

 

$

(158,897)

 

$

53,175

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional paid-in

 

 

 

 

Total stockholders’

 

    

Common stock shares

    

Common stock value

    

capital

    

Accumulated deficit

    

equity

Balance at December 31, 2018

 

22,369,036

 

$

22

 

$

216,931

 

$

(175,888)

 

$

41,065

Cumulative-effect adjustment for the adoption of ASC 606

 

 —

 

 

 —

 

 

 —

 

 

440

 

 

440

Exercise of common stock options and vesting of restricted stock

 

318,770

 

 

 1

 

 

1,910

 

 

 —

 

 

1,911

Shares sold in ATM Offering

 

2,186,163

 

 

 2

 

 

48,017

 

 

 —

 

 

48,019

ESPP stock purchase

 

20,050

 

 

 —

 

 

393

 

 

 —

 

 

393

Stock-based compensation expense

 

 —

 

 

 —

 

 

2,885

 

 

 —

 

 

2,885

Net loss

 

 —

 

 

 —

 

 

 —

 

 

(19,968)

 

 

(19,968)

Balance at June 30, 2019

 

24,894,019

 

$

25

 

$

270,136

 

$

(195,416)

 

$

74,745

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional paid-in

 

 

 

 

Total stockholders’ 

 

    

Common stock shares

    

Common stock value

    

capital

    

Accumulated deficit

    

equity

Balance at December 31, 2017

 

21,707,041

 

 

22

 

 

210,196

 

 

(144,352)

 

 

65,866

Exercise of common stock warrants

 

16,718

 

 

 

 

 —

 

 

 —

 

 

 —

Exercise of common stock options and vesting of restricted stock

 

256,922

 

 

 —

 

 

381

 

 

 —

 

 

381

Sale of common stock in at-the-market offering

 

 

 

 

 

(53)

 

 

 

 

(53)

Stock-based compensation expense

 

 

 

 

 

1,526

 

 

 

 

1,526

Net loss

 

 —

 

 

 —

 

 

 —

 

 

(14,545)

 

 

(14,545)

Balance at June 30, 2018

 

21,980,681

 

$

22

 

$

212,050

 

$

(158,897)

 

$

53,175

 

See accompanying notes

 

 

7

Quanterix Corporation

Notes to condensed consolidated financial statements

(Unaudited)

 

1. Organization and operations

Quanterix Corporation (Nasdaq: QTRX) (the Company) is a life sciences company that has developed next generation, ultra-sensitive digital immunoassay platforms that advance precision health for life sciences research and diagnostics. The Company's platforms are based on its proprietary digital "Simoa" detection technology. The Company's Simoa bead-based and planar array platforms enable customers to reliably detect protein biomarkers in extremely low concentrations in blood, serum and other fluids that, in many cases, are undetectable using conventional, analog immunoassay technologies, and also allow researchers to define and validate the function of novel protein biomarkers that are only present in very low concentrations and have been discovered using technologies such as mass spectrometry. These capabilities provide the Company's customers with insight into the role of protein biomarkers in human health that has not been possible with other existing technologies and enable researchers to unlock unique insights into the continuum between health and disease. The Company is currently focusing on protein detection, but is also developing its bead-based technology to detect nucleic acids in biological samples.

The Company currently markets the Simoa HD-1, a fully automated immunoassay bead-based platform with multiplexing and custom assay capability, and related assay test kits and consumable materials. The Company launched a second bead-based immunoassay platform (SR-X) in the fourth quarter of 2017 with a more compact footprint than the Simoa HD-1 and less automation designed for lower volume requirements while still allowing multiplexing and custom assay capability. The Company initiated an early-access program for its third instrument (SP-X) on the new Simoa planar array platform in January 2019, with the full commercial launch commencing in April 2019. This compact instrument has the ability to reach a 10 plex and has custom assay capability. The Company also performs research services on behalf of customers to apply the Simoa technology to specific customer needs. The Company's customers are primarily in the research use only market, which includes academic and governmental research institutions, the research and development laboratories of pharmaceutical manufacturers, contract research organizations, and specialty research laboratories.

The Company acquired Aushon Biosystems, Inc. (Aushon) in January 2018. With the acquisition of Aushon, the Company acquired a CLIA certified laboratory, as well as Aushon's proprietary sensitive planar array detection technology. Leveraging its proprietary sophisticated Simoa image analysis and data analysis algorithms, the Company further refined this planar array technology to develop the SP-X instrument to provide the same Simoa sensitivity found in its bead-based platform.

The Company believes that its existing unrestricted cash and cash equivalents of approximately $73.1 million at June 30, 2019 will be sufficient to allow the Company to fund its current operating plan through at least twelve months from the filing of the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019. The Company may require additional financing in the future to fund working capital and pay its obligations as they come due. Additional financing might include issuance of equity securities, debt, cash from collaboration agreements or a combination of these. However, there can be no assurance that the Company will be successful in acquiring additional funding at levels sufficient to fund its operations or on terms favorable to the Company.

At-the-market offering

On March 19, 2019, the Company entered into a Sales Agreement (the Sales Agreement) with Cowen and Company, LLC (Cowen) with respect to an at-the-market offering program under which the Company may offer and sell, from time to time at its sole discretion, shares of its common stock, par value $0.001 per share, having an aggregate offering price of up to $50.0 million through Cowen as its sales agent. 

On June 5, 2019, the Company issued approximately 2.2 million shares of common stock at an average stock price of $22.73 per share pursuant to the terms of the Sales Agreement. The at-the-market offering resulted in gross proceeds of $49.7 million. The Company incurred $1.7 million in issuance costs associated with the at-the-market offering, resulting in net proceeds to the Company of $48.0 million.  

Basis of presentation

The interim condensed consolidated financial statements are unaudited. The unaudited condensed consolidated financial statements reflect, in the opinion of our management, all adjustments, consisting of only normal recurring adjustments, necessary for a fair presentation of financial position, results of operations, comprehensive loss and cash flows for each period presented in accordance with United States generally accepted accounting principles (U.S. 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 normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. These interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto included in our Annual Report on Form 10‑K for the year ended December 31, 2018 filed with the Securities and Exchange Commission on March 18, 2019 (the 2018 Annual Report on Form 10-K). The consolidated financial information as of December 31, 2018 has been derived from the audited 2018 consolidated financial statements included in the Company’s 2018 Annual Report on Form 10‑K.

 

8

2. Significant accounting policies

Principles of consolidation

The condensed consolidated financial statements have been prepared in accordance with U.S. GAAP and include the accounts of Quanterix Corporation and its wholly‑owned subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation.

Use of estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. In making those estimates and assumptions, the Company bases its estimates on historical experience and on various other assumptions believed to be reasonable. The Company’s significant estimates included in the preparation of the consolidated financial statements are related to revenue recognition, fair value of equity instruments and notes receivable, fair value of assets acquired and liabilities assumed in acquisitions, valuation allowances recorded against deferred tax assets, and stock‑based compensation. Actual results could differ from those estimates.

Business combinations

Under the acquisition method of accounting, the Company allocates the fair value of the total consideration transferred to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values on the date of acquisition. The fair values assigned, defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between willing market participants, are based on estimates and assumptions determined by management. The excess consideration over the aggregate fair value of tangible and intangible assets, net of liabilities assumed, is recorded as goodwill. These valuations require significant estimates and assumptions, especially with respect to intangible assets.

The Company typically uses the discounted cash flow method to value acquired intangible assets. This method requires significant management judgment to forecast future operating results and establish residual growth rates and discount factors. The estimates used to value and amortize intangible assets are consistent with the plans and estimates that are used to manage the business and are based on available historical information and industry estimates and averages. If the subsequent actual results and updated projections of the underlying business activity change compared with the assumptions and projections used to develop these values, the Company could experience impairment charges. In addition, the Company has estimated the economic lives of certain acquired assets and these lives are used to calculate depreciation and amortization expense. If estimates of the economic lives change, depreciation or amortization expenses could be accelerated or slowed.

Restricted cash

Restricted cash primarily represents collateral for a letter of credit issued as security for the lease for the Company’s new headquarters. The restricted cash is long term in nature as the Company will not have access to the funds until more than one year from June 30, 2019.

Recent accounting pronouncements

The Company is considered to be an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, as amended (JOBS Act). The JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. Thus, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The Company has elected to avail itself of this extended transition period and, as a result, the Company will not be required to adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies so long as the Company remains an emerging growth company.

On January 1, 2019, the Company adopted Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers (ASC 606), using the modified retrospective method.  Under ASC 606, revenue is recognized upon the transfer of control of goods or services to customers and reflects the amount of consideration to which an entity expects to be entitled in exchange for those goods or services.  The adoption of ASC 606 has been applied to customer contracts that were not completed as of January 1, 2019, and did not materially change the pattern of revenue recognition for its current customer contracts.  The Company's consolidated financial statements for the prior-year period have not been revised and are reflective of the revenue recognition requirements which were in effect for that period.

The Company recorded an adjustment to the accumulated deficit of $0.4 million as of January 1, 2019 for the cumulative effect primarily related to the deferral of sales commissions.

9

In accordance with the reporting requirements of ASC 606, the disclosure of the impact on the Company's consolidated balance sheet and statement of operations, as a result of adopting the provisions of ASC 606, was as follows (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Prior to

 

 

 

 

 

 

 

 

 

 

 

 

 

adoption of

 

 

As

 

 

 

Adjusted under

 

As reported

 

 

 

ASC 606

 

 

reported

 

 

 

ASC 606

 

June 30, 

 

 

 

June 30, 

 

    

December 31, 2018

    

Adjustments

    

January 1, 2019

    

2019

    

Adjustments

     

2019

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

$

6,792

 

$

47

 

$

6,839

 

$

9,134

 

$

 —

 

$

9,134

Prepaid expenses and other current assets

 

 

2,330

 

 

288

 

 

2,618

 

 

2,377

 

 

35

 

 

2,342

Other non-current assets

 

 

536

 

 

19

 

 

555

 

 

552

 

 

 —

 

 

552

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deferred revenue

 

 

5,437

 

 

43

 

 

5,394

 

 

5,186

 

 

234

 

 

5,420

Deferred revenue, net of current portion

 

 

520

 

 

43

 

 

477

 

 

374

 

 

33

 

 

407

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated deficit

 

$

(175,888)

 

$

(440)

 

$

(175,448)

 

$

(195,416)

 

$

(302)

 

$

(195,718)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended June 30, 2019

 

For the Six Months Ended June 30, 2019

 

 

 

 

 

 

Under ASC

 

 

 

 

 

Under ASC

 

    

Under ASC 606

    

Adjustment

     

 605

    

Under ASC 606

    

Adjustment

     

 605

Product revenue

 

$

8,776

 

$

(16)

 

$

8,760

 

$

18,322

 

$

(49)

 

$

18,273

Service revenue

 

 

4,760

 

 

26

 

 

4,786

 

 

7,550

 

 

131

 

 

7,681

COGS

 

 

6,605

 

 

 2

 

 

6,607

 

 

12,936

 

 

 3

 

 

12,939

Gross profit

 

 

6,931

 

 

 8

 

 

6,939

 

 

12,936

 

 

79

 

 

13,015

Selling general and administrative expenses

 

 

13,429

 

 

35

 

 

13,464

 

 

24,941

 

 

59

 

 

25,000

Net loss

 

$

(10,563)

 

$

(27)

 

$

(10,590)

 

$

(19,968)

 

$

20

 

$

(19,948)

 

The adoption of ASC 606 is discussed in further detail in Note 3.

The Company adopted accounting standards update (ASU) 2016-01, which requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. For equity investments without readily determinable fair values that do not qualify for the practical expedient to estimate fair value using the net asset value per share or its equivalent, the Company has elected to measure these investments at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer. This election is made for each investment separately and is reassessed at each reporting period as to whether the investment continues to qualify for this election. Additionally, at each reporting period, the Company makes a qualitative assessment considering impairment indicators to evaluate whether the investment is impaired. The adoption of this standard did not have a material effect.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842): Recognition and Measurement of Financial Assets and Financial Liabilities (ASU 2016-02), which establishes principles that lessees and lessors shall apply to report useful information to users of financial statements about the amount, timing and uncertainty of cash flows arising from a lease.  Under ASU 2016-02, lessees will be required to recognize a lease liability and a right-of-use asset for all leases (with the exception of short term leases) at the commencement date. ASU 2016-02 is effective for the Company for the year ending December 31, 2020. Early adoption is permitted.  In 2018, the FASB modified ASU 2016-02 by issuing ASU 2018-01 and ASU 2018-11, which collectively added two practical expedients, provided a second modified retrospective transition method which does not require retrospective adjustment of prior periods, and provided certain narrow scope improvements to ASU 2016-02. The Company is currently evaluating the expected impact of ASU 2016-2 on its financial statements.

 

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments  — Credit Losses: Measurement of Credit Losses on Financial Instruments (ASU 2016-13), which amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables and available-for-sale debt securities. The standard is effective for the Company beginning in the first quarter of 2020, with early adoption permitted. The Company is currently evaluating the expected impact of ASU 2016-13 on its financial statements.

In January 2017, the FASB issued ASU No. 2017-04, Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment. This ASU eliminates Step 2 from the goodwill impairment test. In addition, income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. The amendments also eliminate the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. This ASU is effective for annual periods beginning after December 15, 2019 and interim periods within those annual periods. Early

10

adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company does not expect adoption of this ASU to be material to its financial statements.

There have been no other material changes to the significant accounting policies and recent accounting pronouncements previously disclosed in the 2018 Annual Report on Form 10‑K.

 

 

 

3. Revenue recognition

The Company recognizes revenue when a customer obtains control of a promised good or service. The amount of revenue recognized reflects consideration that the Company expects to be entitled to receive in exchange for these goods and services, incentives and taxes collected from customers, that are subsequently remitted to governmental authorities.

The Company adopted ASC 606 on January 1, 2019, using the modified retrospective method for all contracts not completed as of the date of adoption. The reported results for 2019 reflect the application of ASC 606 guidance, while the reported results for 2018 were prepared under ASC 605, Revenue Recognition.  

Customers

The Company’s customers primarily consist of entities engaged in the life sciences research market that pursue the discovery and development of new drugs for a variety of neurologic, cardiovascular, oncologic and other protein biomarkers associated with diseases.  The Company’s customer base exceeds 200 customers and includes several of the largest biopharmaceutical companies, academic research organizations and distributors who serve certain geographic markets.

Product revenue

The Company’s products are composed of analyzer instruments, assay kits and other consumables such as reagents.  Products are sold directly to biopharmaceutical and academic research organizations or are sold through distributors in EMEA and Asia Pacific regions.  The sales of instruments are generally accompanied by an initial year of implied service-type warranties and may be bundled with assays and other consumables and may also include other items such as training and installation of the instrument and/or an extended service warranty. Revenues from the sale of products are recognized at a point in time when the Company transfers control of the product to the customer, which is upon installation for instruments sold to direct customers, and based upon shipping terms for assay kits and other consumables.  Revenue for instruments sold to distributors is generally recognized based upon shipping terms (either upon shipment or delivery).

Service and other revenue

Service revenues are composed of contract research services, initial implied one-year service-type warranties, extended services contracts and other services such as training.  Contract research services are provided through the Company’s Accelerator Laboratory and generally consist of fixed fee contracts.  Revenues from contract research services are recognized at a point in time when the Company completes and delivers its research report on each individually completed study, or over time if the contractual provisions allow for the collection of transaction consideration for costs incurred plus a reasonable margin through the period of performance of the services.  Revenues from service-type warranties are recognized ratably over the contract service period.  Revenues from other services are immaterial.

Collaboration and license revenue

The Company may enter into agreements to license the intellectual property and know-how associated with its instruments in exchange for license fees and future royalties (as described below).  The license agreements provide the licensee with a right to use the intellectual property with the license fee revenues recognized at a point in time as the underlying license is considered functional intellectual property.  The Company has not recognized any revenues from royalties.

Payment terms

The Company’s payment terms vary by the type and location of customer and the products or services offered. Payment from customers is generally required in a term ranging from 30 to 45 days from date of shipment or satisfaction of the performance obligation with no discounts for early payment.  The Company does not provide extended payment terms or financing arrangements to its customers.

11

Disaggregated revenue

When disaggregating revenue, the Company considered all of the economic factors that may affect its revenues. The following tables disaggregate the Company's revenue from contracts with customers by revenue type:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

June 30, 2019

 

June 30, 2019

(in thousands)

 NA

    

 EMEA

    

 Asia Pacific

    

 Total

    

 NA

    

 EMEA

    

 Asia Pacific

    

 Total

Product revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Instruments

$

1,159

 

$

893

 

$

651

 

$

2,703

 

$

2,556

 

$

2,038

 

$

1,525

 

$

6,119

Consumable and other products

 

3,655

 

 

2,095

 

 

323

 

 

6,073

 

 

7,274

 

 

4,183

 

 

747

 

 

12,204

Totals 

$

4,814

 

$

2,988

 

$

974

 

$

8,776

 

$

9,830

 

$

6,221

 

$

2,271

 

$

18,322

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service and other revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service-type warranties

$

814

 

$

300

 

$

28

 

$

1,142

 

$

1,503

 

$

534

 

$

65

 

$

2,102

Research services

 

2,771

 

 

223

 

 

213