Balance Sheet Components

6 Months Ended

Jun. 30, 2024

Balance Sheet Components

Balance Sheet Components

6. Balance Sheet Components

Allowance for doubtful accounts

The following is a roll-forward of the allowances for doubtful accounts related to trade accounts receivable for the three and six months ended June 30, 2024 and 2023:

	Three Months Ended
	June 30,
	2024			2023
		(in thousands)
Beginning balance	$	7,252	$	5,134
(Reversal of) Provision for doubtful accounts		(185)		446
Write-offs		(46)		—
Total	$	7,021	$	5,580

	Six Months Ended
	June 30,
	2024		2023
		(in thousands)
Beginning balance	$	6,481	$	3,830
Provision for doubtful accounts		744		1,750
Write-offs		(204)		—
Total	$	7,021	$	5,580

Property and Equipment, net

The Company’s property and equipment consisted of the following:

		June 30,		December 31,
	Useful Life	2024		2023
		(in thousands)
Machinery and equipment	3-5 years	$	94,785	$	85,626
Computer equipment	3 years		3,040		1,850
Purchased and capitalized software held for internal use	3 years		10,672		11,636
Leasehold improvements	Lesser of useful life or lease term		47,666		38,999
Construction-in-process			41,577		29,392
			197,740		167,503
Less: Accumulated depreciation and amortization			(64,460)		(56,293)
Total Property and Equipment, net		$	133,280	$	111,210

The Company’s long-lived assets are located in the United States.

During the six months ended June 30, 2024, the increase in net property and equipment was due to expansion projects and purchases of new equipment for the Company’s laboratories located in Texas and California to expand testing capabilities, offset by depreciation expense of $13.3 million recorded in the six months ended June 30, 2024. Depreciation expense of $10.2 million was recorded in the six months ended June 30, 2023. The Company did not incur any impairment charges during the six months ended June 30, 2024 or 2023.

Other Accrued Liabilities

The Company’s other accrued liabilities consisted of the following:

	June 30,		December 31,
	2024		2023
	(in thousands)
Reserves for refunds to insurance carriers	$	16,465	$	23,245
Accrued charges for third-party testing		10,574		14,823
Testing and laboratory materials from suppliers		14,142		11,229
Marketing and corporate affairs		11,792		10,085
Short term advances		13,899		—
Legal, audit and consulting fees		31,979		43,897
Accrued shipping charges		1,800		3,646
Sales and income tax payable		4,053		3,731
Accrued third-party service fees		8,173		7,111
Clinical trials and studies		7,502		12,126
Operating lease liabilities, current portion		12,384		11,621
Property and equipment purchases		5,330		4,316
Other accrued interest		1,078		1,078
Other accrued expenses		2,060		2,497
Total other accrued liabilities	$	141,231	$	149,405

Reserves for refunds to insurance carriers include overpayments from and amounts to be refunded to insurance carriers, and additional amounts that the Company estimates for potential refund requests during the period. When the Company releases these previously accrued amounts, they are recognized as product revenues in the condensed statements of operations and comprehensive loss.

The following table summarizes the reserve balance and activities for refunds to insurance carriers for the six months ending June 30, 2024 and 2023:

	June 30,
	2024		2023
	(in thousands)
Beginning balance	$	23,245	$	18,948
Additional reserves		1,065		5,148
Refunds to carriers		(3,095)		(963)
Reserves released to revenue		(4,750)		(7,653)
Ending balance	$	16,465	$	15,480

As of June 30, 2024, the Company had $13.9 million in short term advances obtained as a result of the disruption to Change Healthcare’s network in February 2024 which are due and payable within ten days of demand.