Senseonics Holdings, Inc. [SENS] Filings

10-Q 1 sens-20240630x10q.htm 10-Q

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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, 2024

☐ 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: 001-37717

Senseonics Holdings, Inc.

(Exact name of registrant as specified in its charter)


Delaware (State or other jurisdiction of incorporation or organization)	3841 (Primary Standard Industrial Classification Code Number)	47-1210911 (I.R.S. Employer Identification Number)

20451 Seneca Meadows Parkway

Germantown, MD 20876-7005

(301) 515-7260

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.001 par value	SENS	NYSE American

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 ☒

There were 535,574,088 shares of common stock, par value $0.001, outstanding as of August 02, 2024.

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TABLE OF CONTENTS

PART I: Financial Information

ITEM 1: Financial Statements

Condensed Consolidated Balance Sheets as of June 30, 2024 (Unaudited) and December 31, 2023			3
Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and six months ended June 30, 2024 and 2023			4
Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit) for the three and six months ended June 30, 2024 and 2023			5
Unaudited Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2024 and 2023			6
Notes to Unaudited Condensed Consolidated Financial Statements			7

ITEM 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations			26

ITEM 3: Quantitative and Qualitative Disclosures About Market Risk			37

ITEM 4: Controls and Procedures			37

PART II: Other Information			38

ITEM 1: Legal Proceedings			38

ITEM 1A: Risk Factors			38

ITEM 2: Unregistered Sales of Equity Securities and Use of Proceeds			40

ITEM 3: Defaults Upon Senior Securities			40

ITEM 4: Mine Safety Disclosures			40

ITEM 5: Other Information			40

ITEM 6: Exhibits			41

SIGNATURES			43

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Senseonics Holdings, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except share and per share data)


	June 30,		December 31,
	2024		2023
		(unaudited)

Assets
Current assets:
Cash and cash equivalents	$	34,853	$	75,709
Restricted cash		318		—
Short term investments, net		49,774		33,747
Accounts receivable, net		1,277		808
Accounts receivable, net - related parties		3,075		3,724
Inventory, net		7,215		8,776
Prepaid expenses and other current assets		6,502		7,266
Total current assets		103,014		130,030
Deposits and other assets		5,241		7,006
Property and equipment, net		3,306		1,184
Total assets	$	111,561	$	138,220
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	1,331	$	4,568
Accrued expenses and other current liabilities		11,916		11,744
Accrued expenses and other current liabilities, related parties		1,226		945
Note payable, current portion, net		18,642		—
Total current liabilities		33,115		17,257

Long-term debt and notes payables, net		34,202		41,195
Derivative liabilities		—		102
Other liabilities		6,010		6,214
Total liabilities		73,327		64,768

Preferred stock and additional paid-in-capital, subject to possible redemption: $0.001 par value per share; 12,000 shares authorized and 12,000 shares issued and outstanding as of June 30, 2024 and December 31, 2023		37,656		37,656
Total temporary equity		37,656		37,656

Commitments and contingencies

Stockholders’ equity:
Common stock, $0.001 par value per share; 1,400,000,000 shares and 900,000,000 shares authorized as of June 30, 2024 and December 31, 2023; 535,277,362 shares and 530,364,237 shares issued and outstanding as of June 30, 2024 and December 31, 2023		535		530
Additional paid-in capital		908,472		904,535
Accumulated other comprehensive loss		(7)		(11)
Accumulated deficit		(908,422)		(869,258)
Total stockholders’ equity		578		35,796
Total liabilities and stockholders’ equity	$	111,561	$	138,220

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

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Senseonics Holdings, Inc.

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss

(in thousands, except share and per share data)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Revenue, net	$	778	$	437	$	1,367	$	750
Revenue, net - related parties		4,087		3,689		8,545		7,513
Total revenue		4,865		4,126		9,912		8,263
Cost of sales		4,567		3,709		9,279		7,433
Gross profit		298		417		633		830

Expenses:
Research and development expenses		10,800		12,830		21,238		25,235
Selling, general and administrative expenses		8,991		7,455		17,119		15,173
Operating loss		(19,493)		(19,868)		(37,724)		(39,578)
Other (expense) income, net:
Interest income		1,190		1,311		2,574		2,420
Exchange related gain, net		—		—		—		18,776
Interest expense		(2,085)		(2,310)		(4,133)		(6,962)
Gain on change in fair value of derivatives		102		289		102		6,067
Other (expense) income		(1)		155		17		178
Total other (expense) income, net		(794)		(555)		(1,440)		20,479

Net Loss		(20,287)		(20,423)		(39,164)		(19,099)
Other comprehensive loss
Unrealized (loss) gain on marketable securities		(5)		100		4		558
Other comprehensive (loss) gain		(5)		100		4		558
Total comprehensive loss	$	(20,292)	$	(20,323)	$	(39,160)	$	(18,541)

Basic net loss per common share	$	(0.03)	$	(0.04)	$	(0.06)	$	(0.04)
Basic weighted-average shares outstanding		616,585,664		567,125,022		615,587,105		532,499,776

Diluted net loss per common share	$	(0.03)	$	(0.04)	$	(0.06)	$	(0.04)
Diluted weighted-average shares outstanding		616,585,664		567,125,022		615,587,105		532,499,776

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

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Senseonics Holdings, Inc.

Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit) (in thousands)


													Series B
	Common Stock			Paid-In		Other		Accumulated		Stockholders'		Convertible
	Shares	Amount		Capital		Comprehensive Loss		Deficit		Equity (Deficit)		Preferred Stock Temporary Equity
Three months ended June 30, 2023:
Balance, March 31, 2023	479,780	$	480	$	871,746	$	(220)	$	(807,542)	$	64,464	$	37,656
Issuance of common stock, net of issuance costs	9,945		10		7,366		—		—		7,376		—
Issued common stock for vested RSUs and ESPP purchase	5,228		5		(3)		—		—		2		—
Issuance of warrants, net of issuance costs	—		—		(260)		—		—		(260)		—
Exercise of stock options and warrants	6		—		3		—		—		3		—
Stock-based compensation expense	—		—		2,870		—		—		2,870		—
Shares withheld related to net share settlement of equity awards	(2,132)		(2)		(1,596)		—		—		(1,598)		—
Other	—		—		3		—		—		3		—
Net loss	—		—		—		—		(20,423)		(20,423)		—
Other comprehensive income, net of tax	—		—		—		100		—		100		—
Balance, June 30, 2023	492,827		493		880,129		(120)		(827,965)		52,537		37,656

Six months ended June 30, 2023:
Balance, December 31, 2022	479,637	$	480	$	806,488	$	(678)	$	(808,866)	$	(2,576)	$	37,656
Issuance of common stock, net of issuance costs	9,945		10		7,366		—		—		7,376		—
Issued common stock for vested RSUs and ESPP purchase	5,371		5		82		—		—		87		—
Issuance of warrants, net of issuance costs	—		—		63,282		—		—		63,282		—
Exercise of stock options and warrants	6		—		3		—		—		3		—
Stock-based compensation expense	—		—		4,651		—		—		4,651		—
Shares withheld related to net share settlement of equity awards	(2,132)		(2)		(1,601)		—		—		(1,603)		—
Other	—		—		(142)		—		—		(142)		—
Net loss	—		—		—		—		(19,099)		(19,099)		—
Other comprehensive income, net of tax	—		—		—		558		—		558		—
Balance, June 30, 2023	492,827	$	493	$	880,129	$	(120)	$	(827,965)	$	52,537	$	37,656

Three months ended June 30, 2024:
Balance, March 31, 2024	530,818	$	530	$	906,569	$	(2)	$	(888,135)	$	18,962	$	37,656
Issuance of common stock, net of issuance costs	620		1		—		—		—		1		—
Issued common stock for vested RSUs and ESPP purchase	6,122		6		—		—		—		6		—
Issuance of warrants, net of issuance costs	—		—		—		—		—		—		—
Exercise of stock options and warrants	11		—		5		—		—		5		—
Stock-based compensation expense	—		—		2,926		—		—		2,926		—
Shares withheld related to net share settlement of equity awards	(2,294)		(2)		(1,028)		—		—		(1,030)		—
Net loss	—		—		—		—		(20,287)		(20,287)		—
Other comprehensive loss, net of tax	—		—		—		(5)		—		(5)		—
Balance, June 30, 2024	535,277	$	535	$	908,472	$	(7)	$	(908,422)	$	578	$	37,656

Six months ended June 30, 2024:
Balance, December 31, 2023	530,364	$	530	$	904,535	$	(11)	$	(869,258)	$	35,796	$	37,656
Issuance of common stock, net of issuance costs	728		1		(1)		—		—		—		—
Issued common stock for vested RSUs and ESPP purchase	6,489		6		95		—		—		101		—
Issuance of warrants, net of issuance costs	—		—		149		—		—		149		—
Exercise of stock options and warrants	12		—		6		—		—		6		—
Stock-based compensation expense	—		—		4,727		—		—		4,727		—
Shares withheld related to net share settlement of equity awards	(2,316)		(2)		(1,039)		—		—		(1,041)		—
Net loss	—		—		—		—		(39,164)		(39,164)
Other comprehensive loss, net of tax	—		—		—		4		—		4		—
Balance, June 30, 2024	535,277	$	535	$	908,472	$	(7)	$	(908,422)	$	578	$	37,656

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

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Senseonics Holdings, Inc.

Unaudited Condensed Consolidated Statements of Cash Flows

(in thousands)


	Six Months Ended
	June 30,
	2024		2023
Cash flows from operating activities
Net loss	$	(39,164)	$	(19,099)
Adjustments to reconcile net (loss) income to net cash used in operating activities:
Depreciation and ROU amortization expense		513		454
Non-cash interest expense (debt discount and deferred costs)		1,848		2,014
Net amortization of premiums and accretion of discounts on marketable securities		(282)		1,412
Gain on change in fair value of derivatives		(102)		(6,067)
Exchange related gain, net		—		(18,776)
Stock-based compensation expense		4,727		4,651
Provision for inventory obsolescence		52		(65)
Other		341		55
Changes in assets and liabilities:
Accounts receivable		115		(1,224)
Prepaid expenses and other current assets		765		(314)
Inventory		1,509		(1,823)
Deposits and other assets		1,596		(26)
Accounts payable		(3,296)		556
Accrued expenses and other liabilities		348		493
Accrued interest		76		357
Operating lease liabilities		(450)		(430)
Net cash used in operating activities		(31,404)		(37,832)
Cash flows from investing activities
Capital expenditures		(2,408)		(57)
Purchase of marketable securities		(49,637)		(61,818)
Proceeds from sale and maturity of marketable securities		33,895		87,746
Net cash provided by (used in) investing activities		(18,150)		25,871
Cash flows from financing activities
Proceeds from issuance of common stock, net		—		7,376
Proceeds from exercise of stock options and ESPP issuances, net		107		(52)
Proceeds from issuance of term loan, net		9,950		—
Taxes paid related to net share settlement of equity awards		(1,041)		(1,603)
Repayment of 2023 Notes		—		(15,700)
Proceeds from issuance of warrants, net		—		14,698
Net cash provided by financing activities		9,016		4,719
Net decrease in cash, cash equivalents		(40,538)		(7,242)
Cash, cash equivalents, and restricted cash at beginning of period		75,709		35,793
Cash, cash equivalents, and restricted cash at ending of period	$	35,171	$	28,551

Supplemental disclosure of cash flow information
Cash paid during the period for interest	$	2,209	$	1,756
Lease liabilities arising from obtaining right-of-use assets		—		3,831
Supplemental disclosure of non-cash investing and financing activities
Property and equipment purchases included in accounts payable and accrued expenses		37		—
Issuance of warrants in exchange for PHC Notes		—		48,564
Issuance of warrants for Loan and Security Agreement		149		—

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

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Senseonics Holdings, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

1.	Organization and Nature of Operations

Senseonics Holdings, Inc., a Delaware corporation, is a medical technology company focused on the development and manufacturing of long-term, implantable continuous glucose monitoring (“CGM”) systems to improve the lives of people with diabetes by enhancing their ability to manage their disease with relative ease and accuracy.

Senseonics, Incorporated is a wholly owned subsidiary of Senseonics Holdings, Inc. and was originally incorporated on October 30, 1996, and commenced operations on January 15, 1997. Eon Care Services, LLC and Eon Management Services, LLC are wholly owned subsidiaries of Senseonics, Incorporated formed in April 2024 and July 2024, respectively and will commence operations later this year. Senseonics Holdings, Inc., Senseonics, Incorporated, Eon Care Services, LLC and Eon Management Services, LLC are hereinafter collectively referred to as the “Company” unless otherwise indicated or the context otherwise requires.

2.	Liquidity and Capital Resources

From its founding in 1996 until 2010, the Company has devoted substantially all of its resources to researching various sensor technologies and platforms. Beginning in 2010, the Company narrowed its focus to developing and refining a commercially viable glucose monitoring system. Since our inception, we have incurred significant net losses and expect to incur additional losses in the near future. We incurred total net (loss) income of ($60.4) million and $142.1 million for the years ended December 31, 2023 and 2022, respectively. For the six months ending June 30, 2024, the Company had gross profit of $0.6 million and an accumulated deficit of $908.4 million. To date, the Company has funded its operations principally through the issuance of preferred stock, common stock, warrants, convertible notes and debt. As of June 30, 2024, the Company had unrestricted cash, cash equivalents and marketable securities of $84.6 million.

The Company’s ability to grow revenues and achieve profitability depends on the successful commercialization and adoption of our Eversense CGM systems by diabetes patients and healthcare providers, along with future product development, regulatory approvals, and post-approval requirements. These activities and continued development of the Gemini product, Freedom product and other future products, will require significant uses of working capital through 2024 and beyond.

In accordance with the Financial Accounting Standards Board (FASB) Accounting Standards Codification, 205-40, Presentation of Financial Statements - Going Concern, management is required to assess the Company’s ability to continue as a going concern through twelve months after issuance of the financial statements. Based on the Company's current operating plan, existing unrestricted cash, cash equivalents and marketable securities, anticipated debt repayments, and minimum cash and satisfaction of performance milestones to comply with debt covenants under its Loan and Security Agreement as discussed in Note 12, the Company has determined that substantial doubt exists regarding its ability to continue as a going concern for the one-year period following the date these condensed consolidated financial statements are issued. To sustain its future operations beyond such one-year period, the Company will require additional funding. As part of our liquidity strategy, we will continue to monitor our capital structure and market conditions, and we may finance our cash needs through public or private debt and equity financings and other sources which may include collaborations, strategic alliances, and licensing arrangements with third parties. There is no assurance that the Company will be successful in obtaining sufficient funding on acceptable terms, if at all, and could be forced to delay, reduce, or eliminate some or all of its research, clinical trials, product development or future commercialization efforts, which could materially adversely affect its business prospects or its ability to continue as a going concern. The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Accordingly, the condensed consolidated financial statements have been prepared on a basis that assumes the Company will continue as a going concern and that contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

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On September 8, 2023 (the “Effective Date”), the Company entered into a loan agreement (the “Loan and Security Agreement”) with the several institutions or entities party thereto (collectively, the “Lenders") and Hercules Capital, Inc., a Maryland corporation (“Hercules”) in its capacity as administrative agent and collateral agent for itself and the Lenders, pursuant to which the Lenders have agreed to make available to the Company up to $50.0 million in senior secured term loans (the “Term Loan Facility”), consisting of (i) an initial term loan of $25.0 million (the “Tranche 1 Loan”), which was funded on the Effective Date and (ii) two additional tranches of term loans in the amounts of up to $10.0 million (the “Tranche 2 Loan”) and $15.0 million (the “Tranche 3 Loan”), respectively, which will become available to the Company upon the Company’s satisfaction of certain terms and conditions set forth in the Loan and Security Agreement. In December 2023, we met the terms and conditions to draw on the Tranche 2 Loan and the loan was funded on January 2, 2024 in an amount of $10.0 million. The loans under the Loan and Security Agreement mature on September 1, 2027 (the “Maturity Date”).

On August 10, 2023, the Company entered into separate, privately negotiated exchange agreements (the “Exchange Agreements”) with a limited number of holders (the “Noteholders”) of the Company’s currently outstanding 5.25% Convertible Senior Notes due 2025 (the “2025 Notes”). Under the terms of the Exchange Agreements, the Noteholders agreed to exchange with the Company (the “Exchanges”) up to $30.8 million in aggregate principal amount of the 2025 Notes (the “Exchanged Notes”) for a combination of $7.5 million of cash and newly issued shares of common stock (the “Exchange Shares”). The number of Exchange Shares was determined based upon the volume-weighted average price per share of the common stock during a 15-day averaging period commencing on August 11, 2023 and ending August 31, 2023. Based on the volume-weighted average price per share of the common stock during the averaging period, a total of 35.1 million shares of common stock were issued in the Exchanges. The Exchanges were settled on the initial share issuance date of August 14, 2023 and the final settlement date of September 5, 2023.

In August 2023, the Company entered into an Equity Distribution Agreement (the “Equity Distribution Agreement”) with Goldman Sachs & Co. LLC (“GS”), under which the Company could offer and sell, from time to time, at its sole discretion, shares of its common stock having an aggregate offering price of up to $106.6 million through GS as its sales agent in an “at the market” offering, which represented the remaining capacity under our then-existing at the market program with Jefferies LLC (“Jefferies”), as described below. GS will receive a commission up to 3.0% of the gross proceeds of any common stock sold through GS under the Equity Distribution Agreement. The shares will be offered and sold pursuant to an effective shelf registration statement on Form S-3, which was originally filed with the Securities and Exchange Commission on August 10, 2023. As of June 30, 2024, the Company received approximately $0.3 million in net proceeds from the sale of 728,291 shares under the Equity Distribution Agreement.

In November 2021, we entered into the 2021 Sales Agreement with Jefferies, under which we could offer and sell, from time to time, at our sole discretion, shares of our common stock having an aggregate offering price of up to $150.0 million through Jefferies as our sales agent in an “at the market” offering. Jefferies received commissions up to 3.0% of the gross proceeds of any common stock sold through Jefferies under the 2021 Sales Agreement. During 2023, the Company received $7.4 million in net proceeds from the sale of 9,944,663 shares of its common stock under the 2021 Sales Agreement. Effective August 7, 2023, the Company and Jefferies mutually agreed to terminate the 2021 Sales Agreement. At the time of termination, approximately $106.6 million remained available for issuance pursuant to the 2021 Sales Agreement.

On August 9, 2020, the Company entered into a financing agreement with the parent company of Ascensia Diabetes Care Holdings AG (“Ascensia”), PHC Holdings Corporation (“PHC”), pursuant to which the Company issued $35.0 million in aggregate principal amount of Senior Secured Convertible Notes due on October 31, 2024 (the “PHC Notes”), to PHC. The Company also issued 2,941,176 shares of common stock to PHC as a financing fee. The Company also has the option to sell and issue PHC up to $15.0 million of convertible preferred stock on or before December 31, 2022, contingent upon obtaining U.S. Food and Drug Administration (“FDA”) approval for the 180-day Eversense product for marketing in the United States before such date. The Company successfully obtained FDA approval in February 2022 and the option was not exercised. As described in Note 12, on March 13, 2023, the Company entered into an Exchange Agreement (the “PHC Exchange Agreement”) with PHC, pursuant to which PHC agreed to exchange (the

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“PHC Exchange”) its $35.0 million aggregate principal amount of the PHC Notes, including all accrued and unpaid interest thereon, for a warrant (the “PHC Exchange Warrant”) to purchase up to 68,525,311 shares of the Company’s common stock, $0.001 par value per share (the “PHC Exchange Warrant Shares”). The PHC Exchange Warrant is a “pre-funded” warrant with a nominal exercise price of $0.001 per PHC Exchange Warrant Share. On March 31, 2023, (6:00 am Japan Standard Time on April 1, 2023) the PHC Exchange was consummated, and the Company issued the PHC Exchange Warrant in consideration for the cancellation of the PHC Notes.

On March 13, 2023, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with PHC, pursuant to which the Company issued and sold to PHC in a private placement (the “Private Placement”) a warrant (the “Purchase Warrant”) to purchase 15,425,750 shares of the Company’s common stock, $0.001 par value per share (the “Purchase Warrant Shares”). The purchase price of the Purchase Warrant was approximately $0.97 per Purchase Warrant Share, representing the undiscounted, trailing 10-day volume weighted average price of the Company’s common stock through March 10, 2023. The Purchase Warrant is a “pre-funded” warrant with a nominal exercise price of $0.001 per Purchase Warrant Share. The issuance of the Purchase Warrants enabled PHC to maintain, as of the closing of the transaction, a 15% beneficial ownership for purposes of the Investor Rights Agreement, dated August 9, 2020, between the Company and PHC. The Private Placement closed on March 13, 2023 (the “Private Placement Closing Date”) and the Company received aggregate gross proceeds of $15.0 million, before deducting private placement expenses payable by the Company.

3.	Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. Although the Company considers the disclosures in these unaudited consolidated financial statements to be adequate to make the information presented not misleading, certain information or footnote information normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted as permitted under the rules and regulations of the SEC. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of financial position at June 30, 2024, and December 31, 2023, results of operations, comprehensive income (loss), and changes in stockholder’s deficit for the three and six months ended June 30, 2024 and 2023 and cash flows for the six months ended June 30, 2024 and 2023 have been included. The unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on March 1, 2024. The interim results for June 30, 2024 are not necessarily indicative of the results to be expected for the year ending December 31, 2024, or for any future interim periods.

The unaudited condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. However, substantial doubt about the Company’s ability to continue as a going concern exists. As discussed in Note 2, based on the Company's current operating plan, existing unrestricted cash, cash equivalents and marketable securities, anticipated debt repayments, and minimum cash and satisfaction of performance milestones to comply with debt covenants under its Loan and Security Agreement as discussed in Note 12, the Company has determined that substantial doubt exists regarding its ability to continue as a going concern. The Company will require additional liquidity to continue its operations over the next 12 months and we are currently evaluating strategies to obtain the required additional funding for future operations.

The consolidated financial statements reflect the accounts of Senseonics Holdings, Inc. and its wholly owned operating subsidiary Senseonics, Incorporated. The Company views its operations and manages its business in one segment, glucose monitoring products. Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance.

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Recent Accounting Pronouncements

In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires that an entity report segment information in accordance with Topic 280, Segment Reporting. The amendment in the ASU is intended to improve reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses. The amendments in this update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, on a retrospective basis, with early adoption permitted. The Company is currently evaluating the impact of the new standard on its financial statements and disclosures.

In December 2023, the FASB issued Accounting Standards Update (“ASU”) No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), the objective of which is to enhance the transparency of income tax disclosures by requiring greater disaggregation of information presented and consistent categories in the rate reconciliation. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, or our fiscal year 2025, using either a prospective or retrospective transition method, and early adoption is permitted. The Company is currently evaluating the impact of the new standard on its financial statements and disclosures.

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 reported amounts of assets and liabilities and the reported amounts of revenue and expenses during the reporting period. In the accompanying unaudited consolidated financial statements, estimates are used for, but not limited to, stock-based compensation, recoverability of long-lived assets, deferred taxes and valuation allowances, fair value of investments, derivative assets and liabilities, obsolete inventory, warranty obligations, variable consideration related to revenue, allowance for credit losses, depreciable lives of property and equipment, and accruals for clinical study costs, which are accrued based on estimates of work performed under contract. The Company bases these estimates on historical and anticipated results, trends, and various other assumptions that it believes are reasonable, including assumptions as to future events. These estimates form the basis for making judgments about the carrying values of assets and liabilities and recorded revenues and expenses. Actual results could differ from those estimates; however, management does not believe that such differences would be material.

Significant Accounting Policies

The accounting policies used by the Company in its presentation of interim financial results are consistent with those presented in Note 3 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

4. Revenue Recognition

The Company generates product revenue from sales of the Eversense system and related components and supplies to Ascensia, through a collaboration and commercialization agreement (the “Ascensia Commercialization Agreement”), third-party distributors outside the United States and to strategic fulfillment partners in the United States, who then resell the products to health care providers and patients, or directly to health care systems and health care providers (collectively, the “Customers”). Customers pay the Company for sales, regardless of whether or not the Customers resell the products to health care providers and patients. The Company’s policies for recognizing sales have not changed from those described in our Annual Report on Form 10-K for the year ended December 31, 2023.

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Revenue by Geographic Region

The following table sets forth net revenue derived from the Company’s two primary geographical markets, the United States and outside of the United States, based on the geographic location to which the Company delivers the product, for the three and six months ended June 30, 2024 and 2023:


	Three Months Ended				Six Months Ended
	June 30, 2024				June 30, 2024
			%				%
(Dollars in thousands)	Amount		of Total		Amount		of Total
Revenue, net:
United States	$	3,030	62.3	%	$	6,706	67.7	%
Outside of the United States		1,835	37.7			3,206	32.3
Total	$	4,865	100.0	%	$	9,912	100.0	%


	Three Months Ended				Six Months Ended
	June 30, 2023				June 30, 2023
			%				%
(Dollars in thousands)	Amount		of Total		Amount		of Total
Revenue, net:
United States	$	1,793	43.5	%	$	3,955	47.9	%
Outside of the United States		2,333	56.5			4,308	52.1
Total	$	4,126	100.0	%	$	8,263	100.0	%

Contract Assets

Contract assets consist of unbilled receivables from customers and are recorded at net realizable value and relate to the revenue share variable consideration from the Ascensia Commercialization Agreement. Accounts receivable – related parties, net as of June 30, 2024 and December 31, 2023 included unbilled accounts receivable of $ 0.9 million and $1.5 million, respectively. The Company expects to invoice and collect all unbilled accounts receivable within 12 months.

Concentration of Revenue and Customers

For the three months ended June 30, 2024 and 2023, the Company derived 84% and 89%, respectively, of its total revenue from one customer, Ascensia. Revenues for these corresponding periods represent sales of sensors, transmitters and miscellaneous Eversense system components.

5. Net Loss per Share

Basic net loss per share attributable to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. An aggregate of 83,951,061 shares of common stock issuable upon the exercise of the PHC Exchange Warrant Shares and the Purchase Warrant Shares held by PHC are included in the number of outstanding shares used for the computation of basic net loss per share for the three and six months ended June 30, 2024 and 2023. Since the shares are issuable for little or no consideration, sometimes referred to as “penny warrants”, they are considered outstanding in the context of earnings per share, as discussed in ASC 260-10-45-13.

Dilutive net loss per share is computed using the weighted average number of common shares outstanding during the period and, when dilutive, potential common share equivalents. Potentially dilutive common shares consist of

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shares issuable from restricted stock units, stock options, warrants and the Company’s convertible notes. Potentially dilutive common shares issuable upon vesting of restricted stock units and exercise of stock options and warrants are determined using the average share price for each period under the treasury stock method. Potentially dilutive common shares issuable upon conversion of the Company’s convertible notes are determined using the if converted method. The if-converted method assumes conversion of convertible securities at the beginning of the reporting period. Interest expense, dividends, and the changes in fair value measurement recognized during the period are added back to the numerator. The denominator includes the common shares issuable upon conversion of convertible securities.

In periods of net loss, all potentially dilutive common shares are excluded from the computation of the diluted net loss per share for those periods, as the effect would be anti-dilutive.

The following table sets forth the computation of basic and diluted net loss per share for the periods shown:


		Three Months Ended June 30,				Six Months Ended June 30,
		2024		2023		2024		2023

Net loss	$	(20,287)	$	(20,423)	$	(39,164)	$	(19,099)

Impact of conversion of dilutive securities		—		—		—		—

Dilutive Net loss	$	(20,287)	$	(20,423)	$	(39,164)	$	(19,099)

Net loss per share
Basic	$	(0.03)	$	(0.04)	$	(0.06

Senseonics Holdings, Inc. [SENS] Filings
10-Q	[2024-08-08]
10-Q	[2024-05-13]
10-K	[2024-03-01]
10-Q	[2023-11-09]
10-Q	[2023-08-10]
10-Q	[2023-05-09]
10-K	[2023-03-16]
10-Q	[2022-11-08]
10-Q	[2022-08-09]
10-Q	[2022-05-10]
10-K	[2022-03-01]
10-Q	[2021-11-09]
10-Q	[2021-08-09]
10-Q	[2021-05-13]
10-K	[2021-03-05]
10-Q	[2020-11-09]
10-Q	[2020-08-10]
10-Q	[2020-06-09]
10-K	[2020-03-16]
10-Q	[2019-11-12]
10-Q	[2019-08-07]
10-Q	[2019-05-09]
10-K	[2019-03-15]
10-Q	[2018-11-08]
10-Q	[2018-08-08]
10-Q	[2018-05-10]
10-K	[2018-03-13]
10-Q	[2017-10-31]
10-Q	[2017-08-09]
10-Q	[2017-05-04]
10-K	[2017-02-23]
10-Q	[2016-11-03]
10-Q	[2016-08-09]
10-Q	[2016-05-12]
10-K	[2016-02-19]
S-1	[2016-01-13]
10-Q	[2015-11-13]
10-K	[2015-09-18]
10-Q	[2015-05-15]
10-Q	[2015-02-17]
10-Q	[2014-12-18]
S-1	[2014-08-15]