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10-Q

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 September 30, 2023

☐ 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: 001-34180

STANDARD BIOTOOLS INC.

(Exact name of registrant as specified in its charter)


Delaware		77-0513190
State or other jurisdiction of incorporation or organization		I.R.S. Employer Identification No.

2 Tower Place, Suite 2000 South San Francisco, CA		94080
Address of principal executive offices		Zip Code

Registrant’s telephone number, including area code: (650) 266-6000

_____________________________________________

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


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.001 par value per share	LAB	The Nasdaq Global Select 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 November 3, 2023, there were 79,395,035 shares of the registrant’s common stock, $0.001 par value per share, outstanding.

STANDARD BIOTOOLS INC.

TABLE OF CONTENTS


		Page
PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited)	1

	Condensed Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022	1

	Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2023 and 2022	2

	Condensed Consolidated Statements of Comprehensive Loss for the three and nine months ended September 30, 2023 and 2022	3

	Condensed Consolidated Statements of Stockholders’ Equity (Deficit) for the three and nine months ended September 30, 2023 and 2022	4

	Condensed Consolidated Statements of Cash Flows for three and nine months ended September 30, 2023 and 2022	5

	Notes to Condensed Consolidated Financial Statements:	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28

Item 4.	Controls and Procedures	28

PART II.	OTHER INFORMATION

Item 1.	Legal Proceedings	30

Item 1A.	Risk Factors	30

Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities	32

Item 3.	Defaults Upon Senior Securities	32

Item 4.	Mine Safety Disclosures	32

Item 5.	Other Information	32

Item 6.	Exhibits	33

EXHIBIT LIST		33

SIGNATURES		35

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

STANDARD BIOTOOLS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)

(Unaudited)


	September 30,			December 31,
	2023			2022
ASSETS
Current assets:
Cash and cash equivalents	$	79,655		$	81,309
Short-term investments		49,195			84,475
Accounts receivable (net of allowances of $151 and $592 at September 30, 2023 and December 31, 2022, respectively)		16,560			17,280
Inventories, net		21,927			21,473
Prepaid expenses and other current assets		3,404			4,278
Total current assets		170,741			208,815
Property and equipment, net		24,538			25,652
Operating lease right-of-use asset, net		31,191			33,883
Other non-current assets		2,390			3,109
Developed technology, net		4,200			12,600
Goodwill		106,225			106,251
Total assets	$	339,285		$	390,310
LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable	$	7,327		$	7,914
Accrued compensation and related benefits		10,423			9,153
Operating lease liabilities, current		3,980			3,682
Deferred revenue, current		11,234			10,792
Deferred grant income, current		3,637			3,644
Other accrued liabilities		10,199			6,175
Term loan, current		5,000			2,083
Total current liabilities		51,800			43,443
Convertible notes, net		54,975			54,615
Term loan, non-current		4,615			8,194
Deferred tax liability		1,017			1,055
Operating lease liabilities, non-current		31,150			34,081
Deferred revenue, non-current		3,474			3,816
Deferred grant income, non-current		11,635			14,359
Other non-current liabilities		1,086			961
Total liabilities		159,752			160,524
Commitments and contingencies (Note 7)
Mezzanine equity:
Redeemable preferred stock: $0.001 par value; 256 shares authorized, issued and outstanding at September 30, 2023 and December 31, 2022; aggregate liquidation preference of $255,559 at September 30, 2023 and December 31, 2022		311,253			311,253
Stockholders’ deficit:
Preferred stock: $0.001 par value, 9,744 shares authorized at September 30, 2023 and December 31, 2022; no shares issued and outstanding at September 30, 2023 and December 31, 2022		—			—
Common stock: $0.001 par value, 400,000 shares authorized at September 30, 2023 and December 31, 2022; 82,527 and 79,904 shares issued at September 30, 2023 and December 31, 2022, respectively; 79,470 and 79,482 shares outstanding at September 30, 2023 and December 31, 2022, respectively		82			80
Additional paid-in capital		856,926			847,008
Accumulated other comprehensive loss		(1,949	)		(1,896	)
Accumulated deficit		(980,976	)		(926,096	)
Treasury stock at cost: 3,057 and 422 shares at September 30, 2023 and December 31, 2022, respectively		(5,803	)		(563	)
Total stockholders’ deficit		(131,720	)		(81,467	)
Total liabilities, mezzanine equity and stockholders’ deficit	$	339,285		$	390,310

See accompanying notes

STANDARD BIOTOOLS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)


	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Revenue:
Product revenue	$	18,711		$	19,312		$	57,814		$	51,535
Service and other revenue		6,656			6,334			20,338			19,392
Total revenue		25,367			25,646			78,152			70,927
Cost of revenue:
Cost of product revenue		11,403			14,091			33,276			39,168
Cost of service and other revenue		2,810			2,335			7,783			5,875
Total cost of revenue		14,213			16,426			41,059			45,043
Gross profit		11,154			9,220			37,093			25,884
Operating expenses:
Research and development		6,370			8,486			19,039			29,957
Selling, general and administrative		22,292			26,340			66,187			82,061
Restructuring and related charges		1,998			3,412			5,415			5,102
Transaction-related expenses		1,666			9			1,666			3,857
Total operating expenses		32,326			38,247			92,307			120,977
Loss from operations		(21,172	)		(29,027	)		(55,214	)		(95,093	)
Interest expense		(1,223	)		(1,049	)		(3,469	)		(3,141	)
Loss on forward sale of Series B Preferred Stock		—			—			—			(60,081	)
Loss on Bridge Loans		—			—			—			(13,719	)
Other income (expense), net		1,448			(63	)		4,417			(119	)
Loss before income taxes		(20,947	)		(30,139	)		(54,266	)		(172,153	)
Income tax benefit (expense)		(50	)		713			(614	)		2,900
Net loss	$	(20,997	)	$	(29,426	)	$	(54,880	)	$	(169,253	)
Net loss per share, basic and diluted	$	(0.27	)	$	(0.37	)	$	(0.69	)	$	(2.17	)
Shares used in computing net loss per share, basic and diluted		79,152			78,897			78,967			77,924

See accompanying notes

STANDARD BIOTOOLS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands)

(Unaudited)


	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Net loss	$	(20,997	)	$	(29,426	)	$	(54,880	)	$	(169,253	)
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment		(403	)		(118	)		(560	)		(753	)
Net change in unrealized gain (loss) on investments		5			(238	)		507			(949	)
Other comprehensive income (loss), net of tax		(398	)		(356	)		(53	)		(1,702	)
Comprehensive loss	$	(21,395	)	$	(29,782	)	$	(54,933	)	$	(170,955	)

See accompanying notes

STANDARD BIOTOOLS INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

(In thousands)

(Unaudited)


	Common Stock				Additional Paid-in			Accum. Other			Accum.			Treasury Stock						Total Stockholders’ Equity
	Shares		Amount		Capital			Comp. Loss			Deficit			Shares			Amount			(Deficit)
Balance as of December 31, 2022		79,904	$	80	$	847,008		$	(1,896	)	$	(926,096	)		(422	)	$	(563	)	$	(81,467	)
Issuance of restricted stock, net of shares withheld for taxes, and other		420		—		(93	)		—			—			—			—			(93	)
Stock-based compensation expense		—		—		3,148			—			—			—			—			3,148
Repurchase of common stock		—		—		—			—			—			(1,250	)		(2,466	)		(2,466	)
Net loss		—		—		—			—			(16,843	)		—			—			(16,843	)
Other comprehensive income, net of tax		—		—		—			568			—			—			—			568
Balance as of March 31, 2023		80,324		80		850,063			(1,328	)		(942,939	)		(1,672	)		(3,029	)		(97,153	)
Issuance of restricted stock, net of shares withheld for taxes, and other		1,410		1		(37	)		—			—			—			—			(36	)
Issuance of common stock under ESPP		268		—		326			—			—			—			—			326
Stock-based compensation expense		—		—		3,114			—			—			—			—			3,114
Repurchase of common stock		—		—		—			—			—			(1,209	)		(2,375	)		(2,375	)
Net loss		—		—		—			—			(17,040	)		—			—			(17,040	)
Other comprehensive loss net of tax		—		—		—			(223	)		—			—			—			(223	)
Balance as of June 30, 2023		82,002		81		853,466			(1,551	)		(959,979	)		(2,881	)		(5,404	)		(113,387	)
Issuance of restricted stock, net of shares withheld for taxes, and other		482		1		(12	)		—			—			—			—			(11	)
Issuance of common stock from option exercises		43		—		86			—			—			—			—			86
Stock-based compensation expense		—		—		3,386			—			—			—			—			3,386
Repurchase of common stock		—		—		—			—			—			(176	)		(399	)		(399	)
Net loss		—		—		—			—			(20,997	)		—			—			(20,997	)
Other comprehensive loss net of tax		—		—		—			(398	)		—			—			—			(398	)
Balance as of September 30, 2023		82,527	$	82	$	856,926		$	(1,949	)	$	(980,976	)		(3,057	)	$	(5,803	)	$	(131,720	)


	Common Stock				Additional Paid-in			Accum. Other			Accum.			Treasury Stock				Total Stockholders’ Equity
	Shares		Amount		Capital			Comp. Loss			Deficit			Shares		Amount		(Deficit)
Balance as of December 31, 2021		76,919	$	77	$	831,424		$	(907	)	$	(735,998	)		—	$	—	$	94,596
Issuance of restricted stock, net of shares withheld for taxes, and other		278		—		(89	)		—			—			—		—		(89	)
Issuance of common stock from option exercises