(State or other jurisdiction | (I.R.S. Employer Identification No.) | ||||||||||
of incorporation or organization) | |||||||||||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||
value per share | (The Nasdaq Capital Market) |
Large accelerated filer | ☐ | |||||||
Accelerated filer | ☐ | |||||||
☑ | ||||||||
Smaller reporting company | ||||||||
Emerging growth company |
Item 1. Legal Proceedings | |||||
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Unaudited | ||||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | $ | ||||||
Investments | ||||||||
Trade accounts receivable, net | ||||||||
Inventory | ||||||||
Prepaid expenses | ||||||||
Other current assets | ||||||||
Total current assets | ||||||||
Property and equipment, net | ||||||||
Finance lease assets, net | ||||||||
Operating lease right of use assets, net | ||||||||
Other non-current assets | ||||||||
Total assets | $ | $ | ||||||
LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | $ | ||||||
Accrued liabilities | ||||||||
Accrued interest | ||||||||
Deferred revenue | ||||||||
Current portion of convertible notes | ||||||||
Finance lease, current | ||||||||
Operating lease, current | ||||||||
Derivative liability | ||||||||
Total current liabilities | ||||||||
Finance lease, non-current | ||||||||
Operating lease, non-current | ||||||||
Other non-current liabilities | ||||||||
Accrued interest related-party | ||||||||
Long-term debt related-party | ||||||||
Convertible notes | ||||||||
Total liabilities | $ | $ | ||||||
Commitments and contingencies (see Note 14) |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Unaudited | ||||||||
Stockholders’ deficit: | ||||||||
Preferred shares, $ | ||||||||
Common stock, $ | ||||||||
Contributed capital | ||||||||
Treasury stock | ( | ( | ||||||
Accumulated deficit | ( | ( | ||||||
Accumulated other comprehensive loss | ( | ( | ||||||
Total stockholders’ deficit | ( | ( | ||||||
Total liabilities and stockholders’ deficit | $ | $ |
Three Months Ended | Six Months Ended | ||||||||||||||||
June 30, | June 30, | June 30, | June 30, | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Net sales | $ | $ | $ | $ | |||||||||||||
Cost of sales | |||||||||||||||||
Gross profit | |||||||||||||||||
Costs and expenses: | |||||||||||||||||
Research and development | |||||||||||||||||
Sales, general and administrative | |||||||||||||||||
Total costs and expenses | |||||||||||||||||
Loss from operations | ( | ( | ( | ( | |||||||||||||
Other (expense) income: | |||||||||||||||||
Interest expense | ( | ( | ( | ( | |||||||||||||
Interest expense related-party | ( | ( | |||||||||||||||
(Loss) gain on extinguishment of debt | ( | ( | |||||||||||||||
(Loss) on extinguishment of debt with related party | ( | ( | |||||||||||||||
(Loss) on fair value adjustment | ( | ( | |||||||||||||||
Foreign currency exchange gain | |||||||||||||||||
Interest income | |||||||||||||||||
Other income (expense), net | ( | ( | |||||||||||||||
Total other (expense) income, net | ( | ( | ( | ||||||||||||||
Net loss before income taxes | ( | ( | ( | ( | |||||||||||||
Provision for income taxes | ( | ( | |||||||||||||||
Net loss | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
Basic and diluted net loss per share | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
Weighted average shares outstanding | |||||||||||||||||
Other comprehensive loss: | |||||||||||||||||
Net loss | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
Net unrealized gain (loss) on debt securities available-for-sale | ( | ( | |||||||||||||||
Foreign currency translation adjustment | ( | ( | ( | ( | |||||||||||||
Comprehensive loss | $ | ( | $ | ( | $ | ( | $ | ( |
Six Months Ended | ||||||||
June 30, | June 30, | |||||||
2023 | 2022 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | ( | $ | ( | ||||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation and amortization | ||||||||
Amortization of investment discount | ||||||||
Equity-based compensation | ||||||||
Amortization of debt discount and issuance costs | ||||||||
Amortization of debt discount related-party | ||||||||
Loss on disposal of property and equipment | ||||||||
Unrealized (gain) loss on equity investments | ( | |||||||
Loss (gain) on extinguishment of debt | ( | |||||||
Loss on extinguishment of debt with related party | ||||||||
Loss on fair value adjustments | ||||||||
(Increase) decrease in assets: | ||||||||
Contributions to deferred compensation plan | ( | |||||||
Accounts receivable | ( | |||||||
Inventory | ( | ( | ||||||
Prepaid expense and other | ( | ( | ||||||
Increase (decrease) in liabilities: | ||||||||
Accounts payable | ( | |||||||
Accrued liabilities and other | ||||||||
Accrued interest | ( | |||||||
Accrued interest from related-party | ||||||||
Deferred revenue and income | ( | ( | ||||||
Deferred compensation | ( | |||||||
Net cash used in operating activities | ( | ( | ||||||
Cash flows from investing activities: | ||||||||
Purchases of equipment | ( | ( | ||||||
Purchase of marketable securities | ( | |||||||
Maturities of marketable securities | ||||||||
Net cash provided (used) by investing activities | ( | |||||||
Cash flows from financing activities: | ||||||||
Proceeds from issuance of common stock to related party | ||||||||
Payments on finance leases | ( | ( | ||||||
Proceeds from exercise of options | ||||||||
Proceeds from issuance of common stock under employee purchase plan | ||||||||
Proceeds from issuance of convertible notes | ||||||||
Transaction costs related to debt and equity issuances | ( | |||||||
Net cash provided (used) by financing activities | ( |
Six Months Ended | ||||||||
June 30, | June 30, | |||||||
2023 | 2022 | |||||||
Effect of exchange rate on cash | ( | ( | ||||||
Decrease in cash and cash equivalents | ( | ( | ||||||
Cash and cash equivalents, beginning of period | ||||||||
Cash and cash equivalents, end of period | $ | $ | ||||||
Non-cash investing activities: | ||||||||
Net transfer of instruments from inventory to property and equipment | $ | $ | ||||||
Non-cash financing activities: | ||||||||
Extinguishment of | $ | $ | ||||||
Capital contribution from the exchange of secured note and accrued interest through the issuance of common stock with related party | $ | $ | ||||||
Exchange of | $ | $ | ||||||
Debt premium on issuance of | $ | $ | ||||||
Derivative liability | $ | $ | ||||||
Supplemental cash flow information: | ||||||||
Interest paid | $ | $ |
Three Months Ended | Six Months Ended | ||||||||||||||||
June 30, | June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Preferred stock shares outstanding | |||||||||||||||||
Beginning | |||||||||||||||||
Conversion of preferred stock into common stock with related party | ( | — | ( | — | |||||||||||||
Ending | |||||||||||||||||
Preferred stock | |||||||||||||||||
Beginning | $ | $ | $ | $ | |||||||||||||
Conversion of preferred stock into common stock with related party | ( | — | ( | — | |||||||||||||
Ending | $ | $ | $ | $ | |||||||||||||
Common stock shares outstanding | |||||||||||||||||
Beginning | |||||||||||||||||
Issuance of common stock to a related party | — | — | |||||||||||||||
Conversion of preferred stock into common stock with related party | — | — | |||||||||||||||
Restricted stock awards released | |||||||||||||||||
Issuance of shares to retire senior promissory notes with related party | — | — | |||||||||||||||
Issuance of common stock under employee purchase plan | — | — | |||||||||||||||
Issuance of shares to retire convertible notes | — | — | |||||||||||||||
Ending | |||||||||||||||||
Common stock | |||||||||||||||||
Beginning | $ | $ | $ | $ | |||||||||||||
Issuance of common stock to a related party | — | — | |||||||||||||||
Issuance of shares to retire senior promissory notes with related party | — | — | |||||||||||||||
Issuance of common stock under employee purchase plan | — | — | — | — | |||||||||||||
Issuance of shares to retire convertible notes | — | — | |||||||||||||||
Ending | $ | $ | $ | $ |
Three Months Ended | Six Months Ended | ||||||||||||||||
June 30, | June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Contributed capital | |||||||||||||||||
Beginning | $ | $ | $ | $ | |||||||||||||
Cumulative effect of accounting changes | — | — | — | ( | |||||||||||||
Proceeds from issuance of common stock | — | — | |||||||||||||||
Capital contribution from modification of securities purchase agreement with related party | — | — | |||||||||||||||
Exercise of options | — | — | |||||||||||||||
Issuance of shares to retire senior promissory notes with related party | — | — | |||||||||||||||
Issuance of common stock under employee purchase plan | — | — | |||||||||||||||
Issuance of shares to retire convertible notes | — | — | |||||||||||||||
Equity-based compensation | |||||||||||||||||
Reclassification of common stock par value due to reverse stock split | |||||||||||||||||
Ending | $ | $ | $ | $ | |||||||||||||
Accumulated deficit | |||||||||||||||||
Beginning | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
Cumulative effect of accounting changes | — | — | — | ||||||||||||||
Net loss | ( | ( | ( | ( | |||||||||||||
Ending | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
Treasury stock | |||||||||||||||||
Beginning | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
Ending | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
Accumulated other comprehensive (loss) income | |||||||||||||||||
Beginning | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
Net unrealized gain (loss) on debt securities available-for-sale | ( | ( | |||||||||||||||
Foreign currency translation adjustment | ( | ( | ( | ( | |||||||||||||
Ending | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||
Total stockholders' deficit | $ | ( | $ | ( | $ | ( | $ | ( |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||
Beginning balance | $ | $ | $ | $ | ||||||||||
Provisions, net | ||||||||||||||
Write-offs | ( | ( | ( | |||||||||||
$ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Beginning balance | $ | $ | $ | $ | |||||||||||||
Provisions (reversals), net | |||||||||||||||||
Warranty cost incurred | ( | ( | ( | ( | |||||||||||||
Ending balance | $ | $ | $ | $ |
June 30, 2023 | ||||||||||||||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||
Assets: | ||||||||||||||
Cash and cash equivalents: | ||||||||||||||
Money market funds | $ | $ | $ | $ | ||||||||||
Total cash and cash equivalents | ||||||||||||||
Equity investments: | ||||||||||||||
Mutual funds | ||||||||||||||
Total equity investments | ||||||||||||||
Debt securities available-for-sale: | ||||||||||||||
Corporate notes and bonds | ||||||||||||||
Debt securities available-for-sale | ||||||||||||||
Total assets measured at fair value | $ | $ | $ | $ |
December 31, 2022 | ||||||||||||||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||
Assets: | ||||||||||||||
Cash and cash equivalents: | ||||||||||||||
Money market funds | $ | $ | $ | $ | ||||||||||
Total cash and cash equivalents | ||||||||||||||
Equity investments: | ||||||||||||||
Mutual funds | ||||||||||||||
Total equity investments | ||||||||||||||
Debt securities available-for-sale: | ||||||||||||||
Certificates of deposit | ||||||||||||||
U.S. Treasury securities | ||||||||||||||
Commercial paper | ||||||||||||||
Corporate notes and bonds | ||||||||||||||
Debt securities available-for-sale | ||||||||||||||
Total assets measured at fair value | $ | $ | $ | $ |
June 30, 2023 | ||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||
Corporate notes and bonds | $ | $ | $ | $ | ||||||||||
Total | $ | $ | $ | $ |
December 31, 2022 | ||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||
Certificates of deposit | $ | $ | $ | ( | $ | |||||||||
U.S. Treasury securities | ( | |||||||||||||
Commercial paper | ( | |||||||||||||
Corporate notes and bonds | ( | |||||||||||||
Total | $ | $ | $ | ( | $ |
June 30, 2023 | December 31, 2022 | |||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||
Due in less than 1 year | $ | $ | $ | $ | ||||||||||
Total | $ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Unrealized (gain) loss on equity investments | $ | ( | $ | $ | ( | $ |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Raw materials | $ | $ | ||||||
Work in process | ||||||||
Finished goods | ||||||||
$ | $ |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Computer equipment | $ | $ | ||||||
Technical equipment | ||||||||
Facilities | ||||||||
Instruments | ||||||||
Capital projects in progress | ||||||||
Total property and equipment | $ | $ | ||||||
Accumulated depreciation | ( | ( | ||||||
Property and equipment, net | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Depreciation expense | $ | $ | $ | $ |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Instruments at cost under operating leases | $ | $ | ||||||
Accumulated depreciation under operating leases | ( | ( | ||||||
Net property and equipment under operating leases | $ | $ |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Products and services not yet delivered | $ | $ |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Outstanding principal at par | $ | $ | ||||||
Debt premium | ||||||||
Unamortized debt discount | ( | |||||||
Unamortized debt issuance costs | ( | ( | ||||||
Net carrying amount | $ | $ |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Current portion of convertible notes | $ | $ | ||||||
Non-current portion of convertible notes | ||||||||
Total convertible notes | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Contractual coupon interest | $ | $ | $ | $ | |||||||||||||
Amortization of debt discount and issuance costs | |||||||||||||||||
Total interest expense on convertible notes | $ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
(Loss) gain on extinguishment | $ | ( | $ | $ | ( | $ |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Outstanding principal at par | $ | $ | ||||||
Unamortized debt issuance | ( | |||||||
Net carrying amount | $ | $ |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Current portion of convertible notes | $ | $ | ||||||
Non-current portion of convertible notes | ||||||||
Total convertible notes | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Contractual coupon interest | $ | $ | $ | $ | |||||||||||||
Amortization of debt issuance costs | |||||||||||||||||
Total interest expense on convertible notes | $ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Beginning balance | $ | $ | $ | $ | |||||||||||||
Derivative liability, June 9, 2023 | $ | $ | |||||||||||||||
Change in value - loss | |||||||||||||||||
Ending balance | $ | $ | $ | $ |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Outstanding principal at par | $ | $ | ||||||
Debt premium | ||||||||
Unamortized debt discount | ( | |||||||
Unamortized debt issuance | ( | |||||||
Net carrying amount | $ | $ |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Current portion of convertible notes | $ | $ | ||||||
Non-current portion of convertible notes | ||||||||
Total convertible notes | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Contractual coupon interest | $ | $ | $ | $ | |||||||||||||
Amortization of debt discount and issuance costs | |||||||||||||||||
Total interest expense on convertible notes | $ | $ | $ | $ |
2023 | $ | ||||
2024 | |||||
2025 | |||||
2026 | |||||
2027 | |||||
Total including PIK interest, before unamortized discount and issuance costs | $ | ||||
Less: unaccrued paid-in-kind interest | ( | ||||
Less: unamortized discount and deferred issuance costs | ( | ||||
Total notes payable | $ |
June 30, | June 9, | |||||||
2023 | 2023 | |||||||
Coupon rate | ||||||||
Term (years) | ||||||||
Volatility | % | % | ||||||
Risk-free rate | % | % | ||||||
Discount yield | % | % | ||||||
Discount factor | % | % |
June 30, | June 9, | |||||||
2023 | 2023 | |||||||
Stock price | $ | $ | ||||||
Initial conversion price | $ | $ | ||||||
Conversion cap | $ | $ | ||||||
Term (years) | ||||||||
Time to call (years) | ||||||||
Volatility | % | % | ||||||
Risk-free rate | % | % | ||||||
Discount yield | % | % |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Outstanding principal | $ | $ | ||||||
Unamortized debt issuance discount | ( | |||||||
Net carrying amount | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Contractual interest | $ | $ | $ | $ | |||||||||||||
Amortization of the debt discount | |||||||||||||||||
Total interest expense | $ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Shares issuable upon the release of RSUs | |||||||||||||||||
Shares issuable upon exercise of stock options | |||||||||||||||||
Shares issuable upon the exercise of the Warrant | |||||||||||||||||
Number of Shares | Weighted Average Exercise Price per Share | |||||||
Options outstanding January 1, 2023 | $ | |||||||
Granted | ||||||||
Forfeited | ( | |||||||
Exercised | ||||||||
Expired | ( | |||||||
Options outstanding June 30, 2023 | $ |
Options Outstanding | Options Exercisable | |||||||
Number of options | ||||||||
Weighted average remaining contractual term (in years) | ||||||||
Weighted average exercise price | $ | $ | ||||||
Weighted average fair value | $ | $ | ||||||
Aggregate intrinsic value (in thousands) | $ | $ |
Number of Shares | Weighted Average Grant Date Fair Value per Share | |||||||
Outstanding January 1, 2023 | $ | |||||||
Granted | ||||||||
Forfeited | ( | |||||||
Released | ( | |||||||
Outstanding June 30, 2023 | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Cost of sales | $ | $ | $ | $ | |||||||||||||
Research and development | |||||||||||||||||
Sales, general and administrative | |||||||||||||||||
$ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Cost capitalized to inventory | $ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||
Cash paid for amounts included in lease liabilities: | |||||||||||||||||
Operating cash flows from operating leases | $ | $ | $ | $ | |||||||||||||
Financing cash flows from finance leases | $ | $ | $ | $ | |||||||||||||
ROU assets obtained in exchange for lease obligations: | |||||||||||||||||
Operating leases | $ | $ | $ | $ | |||||||||||||
Finance leases | $ | $ | $ | $ | |||||||||||||
Lease Cost: | |||||||||||||||||
Operating leases | $ | $ | $ | $ | |||||||||||||
Finance leases | $ | $ | $ | $ | |||||||||||||
Short-term leases | $ | $ | $ | $ |
Operating | Finance | |||||||
Remainder of 2023 | $ | $ | ||||||
2024 | ||||||||
2025 | ||||||||
2026 | ||||||||
2027 | ||||||||
Thereafter | ||||||||
Total lease payments | ||||||||
Less imputed interest | ( | ( | ||||||
$ | $ |
Remainder of 2023 | $ | ||||
2024 | |||||
2025 | |||||
2026 | |||||
2027 | |||||
Thereafter | |||||
Total undiscounted cash flows | |||||
Less imputed interest | |||||
Present value of lease payments | $ |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||
Domestic | $ | $ | $ | $ | ||||||||||
Foreign | ||||||||||||||
$ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||
Accelerate Pheno revenue | $ | $ | $ | $ | ||||||||||
Other revenue | ||||||||||||||
$ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||
Products | $ | $ | $ | $ | ||||||||||
Services | ||||||||||||||
$ | $ | $ | $ |
June 30, | December 31, | |||||||
2023 | 2022 | |||||||
Domestic | $ | $ | ||||||
Foreign | ||||||||
$ | $ |
June 30, | June 9, | |||||||
2023 | 2023 | |||||||
Stock price | $ | $ | ||||||
Exercise price | $ | $ | ||||||
Term (years) | ||||||||
Volatility | % | % | ||||||
Risk-free rate | % | % | ||||||
Fixed commitment purchase price (in thousands) | $ | $ | ||||||
Number of Shares |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||
(in thousands) | (in thousands) | ||||||||||||||||||||||||||||
2023 | 2022 | $ Change | % Change | 2023 | 2022 | $ Change | % Change | ||||||||||||||||||||||
Net sales | $ | 2,921 | $ | 3,861 | $ | (940) | (24) | % | $ | 5,733 | $ | 6,820 | $ | (1,087) | (16) | % |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||
(in thousands) | (in thousands) | ||||||||||||||||||||||||||||
2023 | 2022 | $ Change | % Change | 2023 | 2022 | $ Change | % Change | ||||||||||||||||||||||
Cost of sales | $ | 2,122 | $ | 2,781 | $ | (659) | (24) | % | $ | 3,923 | $ | 4,937 | $ | (1,014) | (21) | % | |||||||||||||
Non-cash equity-based compensation as a component of cost of sales | 98 | 228 | (130) | (57) | % | 188 | 403 | (215) | (53) | % | |||||||||||||||||||
Cost of sales less non-cash equity-based compensation | $ | 2,024 | $ | 2,553 | $ | (529) | (21) | % | $ | 3,735 | $ | 4,534 | $ | (799) | (18) | % |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||
(in thousands) | (in thousands) | ||||||||||||||||||||||||||||
2023 | 2022 | $ Change | % Change | 2023 | 2022 | $ Change | % Change | ||||||||||||||||||||||
Gross profit | $ | 799 | $ | 1,080 | $ | (281) | (26) | % | $ | 1,810 | $ | 1,883 | $ | (73) | (4) | % | |||||||||||||
Non-cash equity-based compensation as a component of gross profit | 98 | 228 | (130) | (57) | % | 188 | 403 | (215) | (53) | % | |||||||||||||||||||
Gross profit less non-cash equity-based compensation | $ | 897 | $ | 1,308 | $ | (411) | (31) | % | $ | 1,998 | $ | 2,286 | $ | (288) | (13) | % |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||
(in thousands) | (in thousands) | ||||||||||||||||||||||||||||
2023 | 2022 | $ Change | % Change | 2023 | 2022 | $ Change | % Change | ||||||||||||||||||||||
Research and development | $ | 5,820 | $ | 7,576 | $ | (1,756) | (23) | % | $ | 12,788 | $ | 13,600 | $ | (812) | (6) | % | |||||||||||||
Non-cash equity-based compensation as a component of research and development | 256 | 539 | (283) | (53) | % | 861 | 901 | (40) | (4) | % | |||||||||||||||||||
Research and development less non-cash equity-based compensation | $ | 5,564 | $ | 7,037 | $ | (1,473) | (21) | % | $ | 11,927 | $ | 12,699 | $ | (772) | (6) | % |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||
(in thousands) | (in thousands) | ||||||||||||||||||||||||||||
2023 | 2022 | $ Change | % Change | 2023 | 2022 | $ Change | % Change | ||||||||||||||||||||||
Sales, general and administrative | $ | 7,564 | $ | 11,493 | $ | (3,929) | (34) | % | $ | 17,669 | $ | 22,167 | $ | (4,498) | (20) | % | |||||||||||||
Non-cash equity-based compensation as a component of sales, general and administrative | 1,299 | 3,204 | (1,905) | (59) | % | 1,159 | 5,646 | (4,487) | (79) | % | |||||||||||||||||||
Sales, general and administrative less non-cash equity-based compensation | $ | 6,265 | $ | 8,289 | $ | (2,024) | (24) | % | $ | 16,510 | $ | 16,521 | $ | (11) | — | % |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||
(in thousands) | (in thousands) | ||||||||||||||||||||||||||||
2023 | 2022 | $ Change | % Change | 2023 | 2022 | $ Change | % Change | ||||||||||||||||||||||
Loss from operations | $ | (12,585) | $ | (17,989) | $ | 5,404 | (30) | % | $ | (28,647) | $ | (33,884) | $ | 5,237 | (15) | % | |||||||||||||
Non-cash equity-based compensation as a component of loss from operations | 1,653 | 3,971 | $ | (2,318) | (58) | % | 2,208 | 6,950 | $ | (4,742) | (68) | % | |||||||||||||||||
Loss from operations less non-cash equity-based compensation | $ | (10,932) | $ | (14,018) | $ | 3,086 | (22) | % | $ | (26,439) | $ | (26,934) | $ | 495 | (2) | % |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||
(in thousands) | (in thousands) | ||||||||||||||||||||||||||||
2023 | 2022 | $ Change | % Change | 2023 | 2022 | $ Change | % Change | ||||||||||||||||||||||
Total other (expense) income, net | $ | (19,994) | $ | (534) | $ | (19,460) | 3,644 | % | $ | (20,727) | $ | 1,896 | $ | (22,623) | (1,193) | % |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||
(in thousands) | (in thousands) | ||||||||||||||||||||||||||||
2023 | 2022 | $ Change | % Change | 2023 | 2022 | $ Change | % Change | ||||||||||||||||||||||
Provision for income taxes | $ | (156) | $ | — | $ | (156) | 100 | % | $ | (156) | $ | — | $ | (156) | 100 | % |
Payments due by Period (in thousands) | |||||||||||||||||||||||
Material Cash Requirements | Total | 2023 | 2024 | 2025 | 2026 | 2027 | Thereafter | ||||||||||||||||
Operating lease obligations | $ | 2,149 | $ | 515 | $ | 1,051 | $ | 583 | $ | — | $ | — | $ | — | |||||||||
Purchase obligation 1) | 11,884 | — | — | — | — | 11,884 | — | ||||||||||||||||
Finance lease obligations | 1,846 | 497 | 1,048 | 265 | 36 | — | — | ||||||||||||||||
Deferred compensation | 1,017 | — | — | 370 | 396 | 251 | — | ||||||||||||||||
5.00% notes 2) | 67,619 | 726 | — | — | 66,893 | — | — | ||||||||||||||||
5.00% notes interest 3) | 12,719 | — | — | — | 12,719 | — | — | ||||||||||||||||
Total | $ | 97,234 | $ | 1,738 | $ | 2,099 | $ | 1,218 | $ | 80,044 | $ | 12,135 | $ | — |
Cash Flow Summary | |||||||||||
Six Months Ended June 30, | |||||||||||
(in thousands) | |||||||||||
2023 | 2022 | $ Change | |||||||||
Net cash used in operating activities | $ | (24,188) | $ | (25,605) | $ | 1,417 | |||||
Net cash provided (used) by investing activities | 9,124 | (9,213) | 18,337 | ||||||||
Net cash provided (used) by financing activities | 9,729 | (280) | 10,009 |
Exhibit No. | Description | Filing Information | ||||||
3.1 | Incorporated by reference to Appendix B to the Registrant’s Definitive Proxy Statement on Schedule 14A filed on November 13, 2012 | |||||||
3.1.1 | Incorporated by reference to Exhibit A to the Registrant’s Definitive Information Statement on Schedule 14C filed on July 12, 2013 | |||||||
3.1.2 | Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on March 15, 2016 | |||||||
3.1.3 | Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on May 15, 2019 | |||||||
3.1.4 | Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on May 13, 2021 | |||||||
3.1.5 | Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on September 23, 2021 | |||||||
3.1.6 | Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on May 17, 2022 | |||||||
3.1.7 | Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on May 24, 2023 | |||||||
3.1.8 | Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on July 13, 2023 | |||||||
3.2 | Incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed on August 8, 2019 | |||||||
3.2.1 | Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on February 3, 2022 | |||||||
4.1 | Incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed on June 13, 2023 | |||||||
4.2 | Incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed on June 13, 2023 | |||||||
10.1* | Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on April 24, 2023 | |||||||
10.2 | Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on May 24, 2023 | |||||||
10.3 | Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on June 13, 2023 | |||||||
10.4 | Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on June 13, 2023 |
10.5 | Incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed on June 13, 2023 | |||||||
10.6 | Incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K filed on June 13, 2023 | |||||||
10.7 | Incorporated by reference to Exhibit 10.5 to the Registrant’s Current Report on Form 8-K filed on June 13, 2023 | |||||||
10.8 | Incorporated by reference to Exhibit 10.6 to the Registrant’s Current Report on Form 8-K filed on June 13, 2023 | |||||||
10.9 | Incorporated by reference to Exhibit 10.7 to the Registrant’s Current Report on Form 8-K filed on June 13, 2023 | |||||||
10.10 | Incorporated by reference to Exhibit 10.8 to the Registrant’s Current Report on Form 8-K filed on June 13, 2023 | |||||||
31.1 | Filed herewith | |||||||
31.2 | Filed herewith | |||||||
32 | Furnished herewith | |||||||
101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | Filed herewith | ||||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document | Filed herewith | ||||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | Filed herewith | ||||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | Filed herewith | ||||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | Filed herewith | ||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | Filed herewith | ||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101) | Filed herewith |
August 14, 2023 | /s/ Jack Phillips | ||||
Jack Phillips President and Chief Executive Officer | |||||
(Principal Executive Officer) | |||||
August 14, 2023 | /s/ David Patience | ||||
David Patience Chief Financial Officer | |||||
(Principal Financial and Accounting Officer) |
August 14, 2023 | /s/ Jack Phillips | ||||
Jack Phillips President and Chief Executive Officer | |||||
(Principal Executive Officer) |
August 14, 2023 | /s/ David Patience | ||||
David Patience Chief Financial Officer | |||||
(Principal Financial and Accounting Officer) |
August 14, 2023 | /s/ Jack Phillips | ||||
Jack Phillips President and Chief Executive Officer | |||||
(Principal Executive Officer) | |||||
August 14, 2023 | /s/ David Patience | ||||
David Patience Chief Financial Officer | |||||
(Principal Financial and Accounting Officer) |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred Stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred Stock, shares issued (in shares) | 0 | 3,954,546 |
Preferred Stock, shares outstanding (in shares) | 0 | 3,954,546 |
Common Stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 450,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 14,357,953 | 9,747,755 |
Common Stock, shares outstanding (in shares) | 14,357,953 | 9,747,755 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Net sales | $ 2,921 | $ 3,861 | $ 5,733 | $ 6,820 |
Cost of sales | 2,122 | 2,781 | 3,923 | 4,937 |
Gross profit | 799 | 1,080 | 1,810 | 1,883 |
Costs and expenses: | ||||
Research and development | 5,820 | 7,576 | 12,788 | 13,600 |
Sales, general and administrative | 7,564 | 11,493 | 17,669 | 22,167 |
Total costs and expenses | 13,384 | 19,069 | 30,457 | 35,767 |
Loss from operations | (12,585) | (17,989) | (28,647) | (33,884) |
Other (expense) income: | ||||
(Loss) on fair value adjustment | (5,030) | 0 | (5,030) | 0 |
Foreign currency exchange gain | 25 | 31 | 258 | 40 |
Interest income | 255 | 56 | 675 | 78 |
Other income (expense), net | 40 | (107) | 85 | (157) |
Total other (expense) income, net | (19,994) | (534) | (20,727) | 1,896 |
Net loss before income taxes | (32,579) | (18,523) | (49,374) | (31,988) |
Provision for income taxes | (156) | 0 | (156) | 0 |
Net loss | $ (32,735) | $ (18,523) | $ (49,530) | $ (31,988) |
Basic net loss per share (in usd per share) | $ (2.97) | $ (2.43) | $ (4.75) | $ (4.44) |
Diluted net loss per share (in usd per share) | $ (2.97) | $ (2.43) | $ (4.75) | $ (4.44) |
Weighted average shares outstanding, basic (in shares) | 11,009 | 7,623 | 10,420 | 7,200 |
Weighted average shares outstanding, diluted (in shares) | 11,009 | 7,623 | 10,420 | 7,200 |
Other comprehensive loss: | ||||
Net loss | $ (32,735) | $ (18,523) | $ (49,530) | $ (31,988) |
Net unrealized gain (loss) on debt securities available-for-sale | 4 | (39) | 28 | (132) |
Foreign currency translation adjustment | (26) | (161) | (281) | (240) |
Comprehensive loss | (32,757) | (18,723) | (49,783) | (32,360) |
Nonrelated Party | ||||
Other (expense) income: | ||||
Interest expense | (1,175) | (713) | (1,593) | (1,630) |
Interest expense related-party | 1,175 | 713 | 1,593 | 1,630 |
(Loss) gain on extinguishment of debt | (6,550) | 199 | (6,550) | 3,565 |
Related Party | ||||
Other (expense) income: | ||||
Interest expense | (804) | 0 | (1,817) | 0 |
Interest expense related-party | 804 | 0 | 1,817 | 0 |
(Loss) gain on extinguishment of debt | $ (6,755) | $ 0 | $ (6,755) | $ 0 |
ORGANIZATION AND NATURE OF BUSINESS; BASIS OF PRESENTATION; PRINCIPLES OF CONSOLIDATION; SIGNIFICANT ACCOUNTING POLICIES |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ORGANIZATION AND NATURE OF BUSINESS; BASIS OF PRESENTATION; PRINCIPLES OF CONSOLIDATION; SIGNIFICANT ACCOUNTING POLICIES | NOTE 1. ORGANIZATION AND NATURE OF BUSINESS; BASIS OF PRESENTATION; PRINCIPLES OF CONSOLIDATION; SIGNIFICANT ACCOUNTING POLICIES Accelerate Diagnostics, Inc. (“we” or “us” or “our” or “Accelerate” or the “Company”) is an in vitro diagnostics company dedicated to providing solutions that improve patient outcomes and lower healthcare costs through the rapid diagnosis of serious infections. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) and applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as filed with the SEC on March 31, 2023. The condensed consolidated balance sheet as of December 31, 2022 included herein was derived from the audited financial statements as of that date but does not include all disclosures such as notes required by U.S. GAAP. The accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods presented, but are not necessarily indicative of the results of operations to be anticipated for the entire year ending December 31, 2023, or any future period. All amounts are rounded to the nearest thousand dollars unless otherwise indicated. On July 11, 2023, the Company effected a one-for-ten reverse stock split. Consequently, on the Company’s condensed consolidated balance sheet, the aggregate par value of the issued common stock was reduced by reclassifying the par value amount of the eliminated shares of common stock to additional paid-in capital. All per share amounts and outstanding shares, including all common stock equivalents (stock options), have been retroactively restated in the condensed consolidated financial statements and in the Notes to the condensed consolidated financial statement for all periods presented to reflect the reverse stock split. Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries after elimination of intercompany transactions and balances. Liquidity and Going Concern Since inception, the Company has not achieved profitable operations or positive cash flows from operations. The Company’s accumulated deficit totaled $656.8 million as of June 30, 2023. During the six months ended June 30, 2023, the Company had a net loss of $49.5 million and negative cash flows from operations of $24.2 million. The Company had a working capital deficit of $11.5 million as of June 30, 2023. On March 9, 2023, the Company entered into a forbearance agreement (the “Forbearance Agreement”), which became effective on March 13, 2023, with the holders of approximately 85% of the Company’s outstanding 2.50% Convertible Senior Notes due 2023 (the “2.50% Notes”) (collectively, the “Ad Hoc Noteholder Group”) and the trustee for the 2.50% Notes (the “Trustee”). On March 15, 2023, the 2.50% Notes matured and became due and payable. Pursuant to the Forbearance Agreement, the members of the Ad Hoc Noteholder Group agreed, and directed the Trustee, to forbear from exercising their rights and remedies under the indenture governing the 2.50% Notes (the “2.50% Notes Indenture”) in connection with certain events of default under the 2.50% Notes Indenture, including, but not limited to, the failure to timely pay in full the principal of any 2.50% Note due and payable on March 15, 2023 and the failure to pay any interest on any 2.50% Note due and payable. The Forbearance Agreement was initially effective for the period commencing on March 13, 2023 and ending on March 29, 2023, which was subsequently extended by the parties to April 21, 2023. On April 21, 2023, the Company entered into a restructuring support agreement (the “Restructuring Support Agreement”) with certain holders of the 2.50% Notes, the holder of the Company’s secured promissory note in an aggregate principal amount of $34.9 million (the “Secured Note”) and the holders of the Company’s Series A Preferred Stock to negotiate in good faith to effect the restructuring of the Company’s capital structure (the “Restructuring Transactions”). On June 9, 2023, the Company completed the Restructuring Transactions contemplated by the Restructuring Support Agreement whereby the Company (i) exchanged approximately $55.9 million aggregate principal amount of 2.50% Notes for approximately $56.9 million aggregate principal amount of newly issued 5.00% Senior Secured Convertible Notes due 2026 (the “5.00% Notes”), which was inclusive of additional 5.00% Notes in respect of interest accrued on the 2.50% Notes from September 15, 2022; (ii) issued and sold an additional $10.0 million aggregate principal amount of 5.00% Notes; (iii) repurchased the Secured Note, plus accrued interest, by issuing approximately 3.4 million shares of the Company’s common stock; (iv) issued approximately 0.4 million shares of the Company’s common stock upon conversion of all of the Company’s outstanding Series A Preferred Stock; (v) amended the March 2022 Securities Purchase Agreement (as defined in Note 17) and issued and sold approximately 0.5 million shares of the Company’s common stock for proceeds of $4.0 million; and (vi) entered into a new securities purchase agreement with the Jack W. Schuler Living Trust (the “Schuler Trust”) pursuant to which the Schuler Trust is required, prior to December 15, 2023, to either purchase an aggregate of $10.0 million of the Company’s common stock from the Company or to backstop an underwritten public offering by the Company of its common stock for aggregate proceeds of $10.0 million, at the Company’s option. See Note 9, Convertible Notes, Note 10, Long-Term Debt Related-Party, Note 17, Stockholders' Equity and Note 18, Related-Party Transactions for additional information. As of June 30, 2023, the Company had $30.7 million in cash and cash equivalents and investments, a decrease of $14.9 million from $45.6 million at December 31, 2022. The primary reason for the decrease was due to cash used in operations, cash used for nonrecurring legal and professional services in connection with the restructuring activities of the 2.50% Notes and common stock issuances, offset by the proceeds from the issuance of the 5.00% Notes and such common stock issuances. The future success of the Company is dependent on its ability to successfully commercialize its products, obtain regulatory clearance for and successfully launch its future product candidates, obtain additional capital and ultimately attain profitable operations. The Company’s primary use of capital has been for the development and commercialization of the Accelerate Pheno system and development of complementary products. The Company is subject to a number of risks similar to other early commercial stage life science companies, including, but not limited to commercially launching the Company’s products, development and market acceptance of the Company’s product candidates, development by its competitors of new technological innovations, protection of proprietary technology, and raising additional capital. Historically, the Company has funded its operations primarily through multiple equity raises and the issuance of debt. See Note 9, Convertible Notes, Note 10, Long-Term Debt Related-Party and Note 17, Stockholders' Equity for additional information. While the Company continues to explore additional funding in the form of potential equity and/or debt financing arrangements or similar transactions, there can be no assurance the necessary financing will be available on terms acceptable to the Company, or at all. If the Company raises funds by issuing equity securities, dilution to stockholders may result. Any equity securities issued may also provide for rights, preferences or privileges senior to those of holders of common stock. If the Company raises funds by issuing additional debt, it is likely any new debt would have rights, preferences and privileges senior to common stockholders. The terms of borrowing could impose significant restrictions on the Company’s operations. The capital markets have in the past, and may in the future, experience periods of upheaval that could impact the availability and cost of equity and debt financing. In addition, recent and anticipated future increases in federal fund rates set by the Federal Reserve, which serve as benchmark rates on borrowing, and other general economic conditions may impact the cost of debt financing or refinancing existing debt. Although the Company is actively considering all available strategic alternatives to maximize value, if the Company is unable to obtain adequate capital resources to fund operations, the Company would not be able to continue to operate its business pursuant to its current plans. This may require the Company to, among other things, materially modify its operations to reduce spending; sell assets or operations; delay the implementation of, or revising certain aspects of, its business strategy; or discontinue its operations entirely. The Company is required to evaluate its financial condition as of the date of filing this Form 10-Q pursuant to the requirements of Accounting Standards Codification (“ASC”) 205-40, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. Management must evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. This evaluation initially does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented as of the date the financial statements are issued. When substantial doubt exists under this methodology, management evaluates whether the mitigating effect of its plans sufficiently alleviates substantial doubt about the Company’s ability to continue as a going concern. The mitigating effect of management’s plans, however, is only considered if both (1) it is probable that the plans will be effectively implemented within one year after the date that the financial statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Based on its evaluation pursuant to ASC 205-40, the Company has determined that, as of the date of this Form 10-Q filing, there is substantial doubt about its ability to continue as a going concern, as the Company does not currently have adequate financial resources to fund its forecasted operating costs for at least twelve months from the date of issuance of these condensed consolidated financial statements. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described above. Use of Estimates The preparation of the Company’s condensed consolidated financial statements requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The more significant areas requiring the use of management estimates and assumptions relate to accounts receivable, inventory, property and equipment, accrued liabilities, warranty liabilities, derivatives, convertible notes, tax valuation accounts, equity-based compensation, warrants, revenue and leases. Actual results could differ materially from those estimates. Estimated Fair Value of Financial Instruments The Company follows ASC 820, Fair Value Measurement, which has defined fair value and requires the Company to establish a framework for measuring and disclosing fair value. The framework requires the valuation of assets and liabilities subject to fair value measurements using a three-tiered approach and fair value measurement be classified and disclosed in one of the following three categories: •Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; •Level 2: Quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; •Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). The carrying amounts of financial instruments such as cash and cash equivalents, trade accounts receivable, prepaid expenses, other current assets, accounts payable, accrued liabilities, and other current liabilities approximate the related fair values due to the short-term maturities of these instruments. See Note 4, Fair Value of Financial Instruments, for further information and related disclosures regarding the Company’s fair value measurements. The 2.50% Notes matured on March 15, 2023 and became due and payable on such date. As of June 30, 2023, $0.7 million of the 2.50% Notes had not been converted and remained outstanding and in default. The carrying amount of these 2.50% Notes approximates the related fair value due to the instrument being fully matured and payable on June 30, 2023. As of December 31, 2022, the Notes were instruments measured at fair value using Level 2 inputs, as the Notes were traded on an active market with observable inputs. See Note 9, Convertible Notes for further details on the 2.50% Notes. The 5.00% Notes are instruments measured at fair value at initial measurement using Level 3 inputs. As of June 30, 2023, the debt is carried at amortized cost and the fair value is disclosed. See Note 9, Convertible Notes for further details on the 5.00% Notes. The Company’s 5.00% Notes conversion option (the “Conversion Option”) met the bifurcation criteria under, Derivatives and Hedging (“Topic 815”), at inception and through June 30, 2023, and must be recorded at fair value, and marked to market at each reporting period until it becomes fixed. The Conversion Option is considered a derivative that is measured at fair value using Level 3 inputs. See Note 9, Convertible Notes for further details on the Conversion Option. During the three months ended June 30, 2023, the Company entered into a securities purchase agreement with the Schuler Trust to purchase common stock from the Company at the Company’s option (the “Schuler Purchase Obligation”). The Schuler Purchase Obligation was determined to be a freestanding financial instrument that must be recorded as an asset at fair value, and marked to market at each reporting period that is outstanding using Level 3 inputs. See Note 17, Stockholders' Equity for further details on the Schuler Purchase Obligation. During the three months ended June 30, 2023, the Company fully extinguished the Secured Notes held by the Schuler Trust by exchanging the Secured Notes for common stock. As of December 31, 2022, the Secured Notes were instruments carried at amortized cost while fair value was disclosed using Level 3 inputs. See Note 10, Long-Term Debt Related-Party for further details on the Secured Notes. Cash and Cash Equivalents All highly liquid investments with an original maturity of three months or less at time of purchase are considered to be cash equivalents. Cash and cash equivalents include overnight repurchase agreement accounts and other investments. As part of the Company’s cash management process, excess operating cash is invested in overnight repurchase agreements with its bank. Repurchase agreements and other investments classified as cash and cash equivalents are not deposits and are not insured by the U.S. Government, the FDIC or any other government agency and involve investment risk including possible loss of principal. Notwithstanding the possibility of bank failures, we believe that as a result of the Company’s selected banks, diversified holdings strategy, and the U.S. Government’s continued support to stabilize the banking system, such as steps taken in March 2023 as a result of certain bank failures, that the market risk arising from holding these financial instruments is minimal. Investments The Company invests in various debt and equity securities which are primarily held in the custody of major financial institutions. Debt securities consist of certificates of deposit, U.S. government and agency securities, commercial paper, and corporate notes and bonds. Equity securities consist of mutual funds. The Company records these investments in the condensed consolidated balance sheet at fair value. Unrealized gains or losses for debt securities available-for-sale are included in accumulated other comprehensive loss, a component of stockholders’ deficit. Unrealized gains or losses for equity securities are included in other income (expense), net, a component of condensed consolidated statements of operations and comprehensive loss. The Company considers all debt securities to be available-for-sale, including those with maturity dates beyond 12 months, as they are available to support current operational liquidity needs. The Company classifies its investments as current based on the nature of the investments and their availability for use in current operations. We perform an assessment to determine whether there have been any events or economic circumstances to indicate that a debt security available-for-sale in an unrealized loss position has suffered impairment as a result of credit loss or other factors. A debt security is considered impaired if its fair value is less than its amortized cost basis at the reporting date. If we intend to sell the debt security or if it is more-likely-than-not that we will be required to sell the debt security before the recovery of its amortized cost basis, the impairment is recognized and the unrealized loss is recorded as a direct write-down of the security's amortized cost basis with an offsetting entry to earnings. If we do not intend to sell the debt security or believe we will not be required to sell the debt security before the recovery of its amortized cost basis, the impairment is assessed to determine if a credit loss component exists. We use a discounted cash flow method to determine the credit loss component. In the event a credit loss exists, an allowance for credit losses is recorded in earnings for the credit loss component of the impairment while the remaining portion of the impairment attributable to factors other than credit loss is recognized, net of tax, in accumulated other comprehensive income (loss). The amount of impairment recognized due to credit factors is limited to the excess of the amortized cost basis over the fair value of the security. Inventory Inventory is stated at the lower of cost or net realizable value. The Company determines the cost of inventory using the first-in, first-out method. The Company estimates the recoverability of inventory by reference to internal estimates of future demands and product life cycles, including expiration. The Company periodically analyzes its inventory levels to identify inventory that may expire prior to expected sale or has a cost basis in excess of its estimated realizable value and records a charge to expense for such inventory as appropriate. We charge cost of sales for inventory provisions to write-down our inventory to the lower of cost or net realizable value or for obsolete or excess inventory. Most of our inventory provisions relate to excess quantities of products, based on our inventory levels and future product purchase commitments compared to assumptions about future demand and market conditions. Once inventory has been written-off or written-down, it creates a new cost basis for the inventory that is not subsequently written-up. See Note 6, Inventory, for further information and related disclosures. Accounts Receivable Accounts receivable consist of amounts due to the Company for sales to customers and are based on what we expect to collect in exchange for goods and services. Receivables are considered past due based on the contractual payment terms and are written off if reasonable collection efforts prove unsuccessful. We maintain an allowance for credit losses for expected uncollectible accounts receivable, which is recorded as an offset to accounts receivable and changes in such are classified as general and administrative expense in the consolidated statements of operations. We assess collectability by reviewing accounts receivable on a collective basis where similar characteristics exist and on an individual basis when we identify specific customers with known disputes or collectability issues. In determining the amount of the allowance for credit losses, we consider historical collectability and make judgments about the creditworthiness of customers based on credit evaluations. Our customers typically have good credit quality. We also consider customer-specific information, current market conditions and reasonable and supportable forecasts of future economic conditions to inform adjustments to historical loss data. The allowance for credit losses for the three and six months ended June 30, 2023 and 2022 is comprised of the following (in thousands):
The Company’s three and six months ended June 30, 2023 beginning and ending balances increased when compared to the three and six months ended June 30, 2022 beginning and ending balances due to provisions recorded during the year ended December 31, 2022. These provisions were in connection with aged net investment in sales-type leases. Property and Equipment Property and equipment are recorded at cost. Maintenance and repairs are charged to expense as incurred and expenditures for major improvements are capitalized. Gains and losses from retirement or replacement are included in costs and expenses. Depreciation of property and equipment is computed using the straight-line method over the estimated useful life of the assets, ranging from to seven years. Leasehold improvements are depreciated over the remaining life of the lease or the life of the asset, whichever is less. Instruments Classified as Property and Equipment Property and equipment includes Accelerate Pheno systems (also referred to as instruments) used for sales demonstrations, instruments under rental agreements and instruments used for research and development. Depreciation expense for instruments used for sales demonstrations is recorded as a component of sales, general and administrative expense. Depreciation expense for instruments placed at customer sites pursuant to reagent rental agreements is recorded as a component of cost of sales. Depreciation expense for instruments used in our laboratory and research is recorded as a component of research and development expense. The Company retains title to these instruments and depreciates them over five years. Losses from the retirement of returned instruments are included in costs and expenses. The Company evaluates the recoverability of the carrying amount of its instruments whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable, and at least annually. This evaluation is based on our estimate of future cash flows and the estimated fair value of such long-lived assets, and provides for impairment if such undiscounted cash flows or the estimated fair value are insufficient to recover the carrying amount of instruments. No impairment charges have been recorded for the three and six months ended June 30, 2023 and 2022. See Note 7, Property and Equipment, for further information and related disclosures. Long-lived Assets Long-lived assets and certain identifiable intangibles to be held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company continuously evaluates the recoverability of its long-lived assets based on estimated future cash flows from and the estimated fair value of such long-lived assets, and provides for impairment if such undiscounted cash flows or the estimated fair value are insufficient to recover the carrying amount of the long-lived asset. Warranty Reserve Instruments are typically sold with a one year limited warranty, while kits and accessories are typically sold with a sixty days limited warranty. Accordingly, a provision for the estimated cost of the limited warranty repair is recorded at the time revenue is recognized. Our estimated warranty provision is based on our estimate of future repair events and the related estimated cost of repairs. The Company periodically assesses the adequacy of the warranty reserve and adjusts the amount as necessary. The cost incurred for these provisions is included in cost of sales on the condensed consolidated statements of operations and comprehensive loss. Warranty reserve activity for the three and six months ended June 30, 2023 and 2022 is as follows (in thousands):
Convertible Notes The Company follows Accounting Standards Update (“ASU”) 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40). The Notes are accounted for as a liability measured at their amortized cost. Interest expense is comprised of (1) cash interest payments, (2) amortization of any debt discounts or premiums based on the original offering, and (3) amortization of any debt issuance costs. Gain or loss on extinguishment of Notes is calculated as the difference between the (i) fair value of the consideration transferred and (ii) the carrying value of the debt at the time of repurchase, conversion or settlement. Revenue Recognition The Company recognizes revenue when control of the promised good or service is transferred to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Sales taxes are excluded from revenues. The Company determines revenue recognition through the following steps: •Identification of the contract with a customer •Identification of the performance obligations in the contract •Determination of the transaction price •Allocation of the transaction price to the performance obligations •Recognition of revenue as we satisfy a performance obligation Product revenue is derived from the sale or rental of instruments and sales of related consumable products. When an instrument is sold, revenue is generally recognized upon installation of the unit consistent with contract terms, which do not include a right of return. When a consumable product is sold, revenue is generally recognized upon shipment. Invoices are generally issued when revenue is recognized. Payment terms vary by the type and location of the customer and the products or services offered. The term between invoicing and when payment is due is not significant. Service revenue is derived from the sale of extended service agreements which are generally non-cancellable. This revenue is recognized on a straight-line basis over the contract term beginning on the effective date of the contract because the Company is standing ready to provide services. Invoices are generally issued annually and coincide with the beginning of individual service terms. The Company’s contracts with customers may include multiple performance obligations. For such arrangements, the Company allocates revenue to each performance obligation based on its relative standalone selling price. The Company generally determines relative standalone selling prices based on the price charged to customers for each individual performance obligation. Sales commissions earned by the Company’s sales force are considered incremental and recoverable costs of obtaining a contract with a customer. The Company has determined these costs would have an amortization period of less than one year and has elected to recognize them as an expense when incurred. Contract asset opening and closing balances were immaterial for the three and six months ended June 30, 2023. Gross Profit and Gross Margin Gross profit consists of total revenue, net of allowances, less cost of sales. Cost of sales includes cost of materials, direct labor, equity-based compensation, facility and other manufacturing overhead costs for consumable tests and instruments sold to customers. Cost of sales for instruments also includes depreciation on revenue generating instruments that have been placed with our customers under a reagent rental agreement. Cost of sales includes repair and maintenance cost for instruments covered by a service agreement or instruments covered by a reagent rental agreement. Cost of sales also includes warranty related costs. The Company manufactures pre-launch inventory in advance of regulatory approval. This inventory is expensed before an economic benefit is probable. Pre-launch inventory sold to customers (not capitalized and instead expensed in a previous year) during each of the three and six months ended June 30, 2023 was none and $0.1 million, respectively. Pre-launch inventory sold to customers (not capitalized and instead expensed in a previous year) during each of the three and six months ended June 30, 2022 was $0.2 million and $0.3 million, respectively. Shipping and Handling Shipping and handling costs billed to customers are included as a component of revenue. The corresponding expense incurred with third party carriers is included as a component of sales, general and administrative costs on the consolidated statements of operations and comprehensive loss. Commercial Agent Relationship with Becton, Dickinson and Company (“BD”) The Company has entered into an exclusive commercial agreement with BD to act as the Company’s agent and representative. The purpose of this agreement is to establish an on-going commercialization of the Company’s products. The Company is classified as the principal and BD as the agent. BD shall pay the Company a fee in multiple installments for exclusive rights, while the Company will pay BD an agent fee based on the Company’s revenues. The Company accounts for agent fees consistent with how it accounts for sales commissions as described above. In most instances the agent fees are determined to be costs that would have an amortization period of less than one year and the Company has elected to recognize them as an expense when incurred. The agent fee is a component of sales, general and administrative expenses, within the condensed consolidated statement of operations and comprehensive loss. The Company accounts for the fee from BD as a deferred liability when the cash is received. The deferred liability is then amortized using estimates to reduce the amount of agent fee expense for the period. The Company uses forecasted revenue to estimate the amount of deferred liability to amortize within a period. The deferred liability is a component of deferred revenue, within the condensed consolidated balance sheet, while the corresponding amortization is charged to sales, general and administrative expenses, within the condensed consolidated statement of operations and comprehensive loss. See Note 8, Deferred Revenue and Remaining Performance Obligations, for further information and related disclosures. Leases The Company accounts for leases in accordance with ASC 842, Leases. The Company determines if an arrangement is or contains a lease and the type of lease at inception. The Company classifies leases as finance leases (lessee) or sales-type leases (lessor) when there is either a transfer of ownership of the underlying asset by the end of the lease term, the lease contains an option to purchase the asset that we are reasonably certain will be exercised, the lease term is for the major part of the remaining economic life of the asset, the present value of the lease payments and any residual value guarantee equals or substantially exceeds all the fair value of the asset, or the asset is of such a specialized nature that it will have no alternative use to the lessor at the end of the lease term. Payments contingent on future events (i.e., based on usage) are considered variable and excluded from lease payments for the purposes of classification and initial measurement. Several of our leases include options to renew or extend the term upon mutual agreement of the parties and others include one-year extensions exercisable by the lessee. None of our leases contain residual value guarantees, restrictions, or covenants. To determine whether a contract contains a lease, the Company uses its judgment in assessing whether the lessor retains a material amount of economic benefit from an underlying asset, whether explicitly or implicitly identified, which party holds control over the direction and use of the asset, and whether any substantive substitution rights over the asset exist. Leases as Lessee Operating leases are included in right-of-use (“ROUs”) assets and corresponding lease liabilities, and finance leases are included in ROU assets and corresponding lease liabilities within our condensed consolidated balance sheets. These assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and their related liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Typically, we use our incremental borrowing rate based on the information available at commencement in determining the present value of lease payments. We use the implicit rate when readily determinable. ROU assets are net of lease payments made and exclude lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term, which may include options to extend or terminate the lease when it is reasonably certain that we will exercise the option. Our operating leases consist primarily of leased office, factory, and laboratory space in the U.S. and office space in Europe, have between and six-year terms, and typically contain penalizing, early-termination provisions. Our finance leases consist of leased equipment and have three-year terms. Leases as Lessor The Company leases instruments to customers under “reagent rental” agreements, whereby the customer agrees to purchase consumable products over a stated term, typically five years or less, for a volume-based price that includes an embedded rental for the instruments. When collectability is probable, that amount is recognized as income at lease commencement for sales-type leases and as product is shipped, typically in a straight–line pattern, over the term for operating leases, which typically include a termination without cause or penalty provision given a short notice period. Consideration is allocated between lease and non-lease components based on stand-alone selling price in accordance with ASC 606, Revenue from Contracts with Customers. Net investment in sales-type leases are included within our condensed consolidated balance sheets as a component of other current assets and other non-current assets, which include the present value of lease payments not yet received and the present value of the residual asset, which are determined using the information available at commencement, including the lease term, estimated useful life, rate implicit in the lease, and expected fair value of the instrument. Nonqualified Cash Deferral Plan The Company’s Cash Deferral Plan (the “Deferral Plan”) provides certain key employees with an opportunity to defer the receipt of such participant's base salary. The Deferral Plan is intended to be a nonqualified deferred compensation plan that complies with the provisions of Section 409A of the Internal Revenue Code. All of the investments held in the Deferral Plan are equity securities consisting of mutual funds and recorded at fair value with changes in the investments’ fair value recognized as earnings in the period they occur. The corresponding liability for the Deferral Plan is included in other non-current liabilities in the condensed consolidated balance sheet. Equity-Based Compensation The Company may award stock options, restricted stock units (“RSUs”), performance-based awards and other equity-based instruments to its employees, directors and consultants. Compensation cost related to equity-based instruments is based on the fair value of the instrument on the grant date, and is recognized over the requisite service period on a straight-line basis over the vesting period for each tranche (an accelerated attribution method). Performance-based awards vest based on the achievement of performance targets. Compensation costs associated with performance-based awards are recognized over the requisite service period based on probability of achievement. Performance-based awards require management to make assumptions regarding the likelihood of achieving performance targets. The Company estimates the fair value of service based and performance-based stock option awards, including modifications of stock option awards, using the Black-Scholes option pricing model. This model derives the fair value of stock options based on certain assumptions related to expected stock price volatility, expected option life, risk-free interest rate and dividend yield. •Volatility: The expected volatility is based on the historical volatility of the Company's stock price over the most recent period commensurate with the expected term of the stock option award. •Expected term: The estimated expected term for employee awards is based on a simplified method that considers an insufficient history of employee exercises. For consultant awards, the estimated expected term is the same as the life of the award. •Risk-free interest rate: The risk-free interest rate is based on published U.S. Treasury rates for a term commensurate with the expected term. •Dividend yield: The dividend yield is estimated as zero as the Company has not paid dividends in the past and does not have any plans to pay any dividends in the foreseeable future. The Company records the fair value of RSUs or stock grants based on the published closing market price on the day before the grant date. The Company accounts for forfeitures as they occur rather than on an estimated basis. See Note 12, Employee Equity-Based Compensation for further information. Accounting for Derivatives The Company identified a derivative financial instrument in connection with the Company’s 5.00% Notes Conversion Option. The Company’s derivative is recorded at fair value on the condensed consolidated balance sheet as a current derivative liability and changes in the fair value of the derivative financial instrument is recognized in gain (loss) on financial instruments, within the condensed consolidated statement of operations and comprehensive loss, depending on the changes in fair value. See Note 9, Convertible Notes for further information. Deferred Tax Deferred tax assets and liabilities are recorded for the estimated future tax effects of temporary differences between the tax basis of assets and liabilities and amounts reported in the accompanying condensed consolidated balance sheet. The change in deferred tax assets and liabilities for the period represents the deferred tax provision or benefit for the period. Effects of changes in enacted tax laws in deferred tax assets and liabilities are reflected as an adjustment to the tax provision or benefit in the period of enactment. The Company follows the provisions of ASC 740, Income Taxes, to account for any uncertainty in income taxes with respect to the accounting for all tax positions taken (or expected to be taken) on any income tax return. This guidance applies to all open tax periods in all tax jurisdictions in which the Company is required to file an income tax return. Under U.S. GAAP, in order to recognize an uncertain tax benefit the taxpayer must be more likely than not certain of sustaining the position, and the measurement of the benefit is calculated as the largest amount that is more likely than not to be realized upon resolution of the position. Interest and penalties, if any, would be recorded within tax expense. Foreign Currency Translation and Foreign Currency Transactions Adjustments resulting from translating foreign functional currency financial statements into U.S. Dollars are included in the foreign currency translation adjustment, a component of accumulated other comprehensive loss in the condensed consolidated statements of stockholders’ deficit. The Company has assets and liabilities, including receivables and payables, which are denominated in currencies other than their functional currency. These balance sheet items are subject to re-measurement, the impact of which is recorded in foreign currency exchange gain and loss, within the condensed consolidated statement of operations and comprehensive loss. Loss Per Share Basic loss per share includes no dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period. Potentially dilutive common shares consist of shares issuable from stock options, unvested RSUs and the Warrant (see Note 10). Other potentially dilutive common shares would also include common shares that would be outstanding if the 5.00% Notes were converted. Diluted earnings are not presented when the effect of adding such additional common shares is antidilutive. See Note 11, Loss Per Share, for further information. Comprehensive Loss In addition to net loss, comprehensive loss includes all changes in equity during a period, except those resulting from investments by and distributions to owners. The Company holds debt securities as available-for-sale and records the change in fair market value as a component of comprehensive loss. The Company also has adjustments resulting from translating foreign functional currency financial statements into U.S. Dollars which is included as a component of comprehensive loss.
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RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS |
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Jun. 30, 2023 | |
Accounting Changes and Error Corrections [Abstract] | |
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS | NOTE 2. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS Standards that were recently adopted In March 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2022-01, Derivatives and Hedging (Topic 815): Fair Value Hedging - Portfolio Layer Method. ASU 2022-01 is related to the portfolio layer method of hedge accounting. The amendments in this update clarify the accounting and promote consistency in reporting for hedges where the portfolio layer method is applied. This ASU was adopted January 1, 2023, and did not impact the Company’s consolidated financial statements at January 1, 2023. In March 2022, the FASB issued ASU 2022-02, Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. ASU 2022-02 relates to troubled debt restructurings (“TDRs”) and vintage disclosures for financing receivables. The amendments in this update eliminate the accounting guidance for TDRs by creditors while enhancing disclosure requirements for certain loan refinancing and restructurings by creditors made to borrowers experiencing financial difficulty. The amendments also require disclosure of current-period gross write-offs by year of origination for financing receivables. This ASU was adopted January 1, 2023, and did not impact the Company's consolidated financial statements at January 1, 2023.
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CONCENTRATION OF CREDIT RISK |
6 Months Ended |
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Jun. 30, 2023 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATION OF CREDIT RISK | NOTE 3. CONCENTRATION OF CREDIT RISK Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash equivalents, short-term investments and accounts receivable. The Company has financial institutions for banking operations that hold 10% or more of the Company’s cash and cash equivalents. As of June 30, 2023, two of the Company's financial institutions held 79% and 12%, of the Company’s cash and cash equivalents. As of December 31, 2022, three of the Company’s financial institutions held 52%, 24% and 21% of the Company’s cash and cash equivalents. The Company grants credit to domestic and international customers. Exposure to losses on accounts receivable is principally dependent on each client’s financial position. The Company had one customer that accounted for 16% and 15% of the Company’s net accounts receivable balance as of June 30, 2023 and December 31, 2022, respectively. The Company had one customer that represented 10% of the Company’s total revenue for the three and six months ended June 30, 2023 and no customers that represented 10% or more of the Company’s total revenue for the three and six months ended June 30, 2022.
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FAIR VALUE OF FINANCIAL INSTRUMENTS |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | NOTE 4. FAIR VALUE OF FINANCIAL INSTRUMENTS Assets and Liabilities that are Measured at Fair Value on a Recurring Basis The following tables represent the financial instruments measured at fair value on a recurring basis in the financial statements of the Company and the valuation approach applied to each class of financial instruments at June 30, 2023 and December 31, 2022 (in thousands):
Highly liquid investments with an original maturity of three months or less at time of purchase are included in cash and cash equivalents on the condensed consolidated balance sheet. Level 1 assets are priced using quoted prices in active markets for identical assets which include money market funds, U.S. Treasury securities and mutual funds as these specific assets are liquid. Level 2 available-for-sale securities are priced using quoted market prices for similar instruments or nonbinding market prices that are corroborated by observable market data. The Company uses inputs such as actual trade data, benchmark yields, broker/dealer quotes, and other similar data, which are obtained from quoted market prices, independent pricing vendors, or other sources, to determine the ultimate fair value of these assets and liabilities. The Company uses such pricing data as the primary input to make its assessments and determinations as to the ultimate valuation of its investment portfolio and has not made, during the periods presented, any material adjustments to such inputs. As of June 30, 2023, the Company’s Conversion Option, which is classified as a derivative liability, has a fair value of $42.8 million, using Level 3 measurement assumptions. See Note 9, Convertible Notes for further detail on the Conversion Option. As of June 30, 2023, the Company’s Schuler Purchase Obligation, which is classified as a financial instrument asset, has a fair value of $0.9 million, using Level 3 measurement assumptions. See Note 17, Stockholders' Equity for further detail on the Schuler Purchase Obligation. Liabilities for which Fair Value is only Disclosed As of December 31, 2022, the Secured Notes had an outstanding principal amount of $34.9 million, and a fair value of $16.0 million, using Level 3 measurement assumptions. No Secured Notes were outstanding as of June 30, 2023. See Note 10, Long-Term Debt Related-Party for further detail on the Secured Note. As of June 30, 2023, the Company’s 5.00% Notes had an outstanding principal amount of $66.9 million, and a fair value of $35.2 million, using Level 3 measurement assumptions. See Note 9, Convertible Notes for further detail on the 5.00% Notes. The 2.50% Notes matured on March 15, 2023 and became due and payable on such date. The amortized carrying amount of the 2.50% Notes is $0.7 million as of June 30, 2023 and approximates the related fair value due to the instrument being fully matured and payable. As of December 31, 2022, the 2.50% Notes represented a Level 2 measurement with an outstanding principal amount of $56.6 million, and a fair value of $51.9 million. See Note 9, Convertible Notes for further detail on the 2.50% Notes.
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INVESTMENTS |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENTS | NOTE 5. INVESTMENTS The following tables summarize the Company’s debt securities classified as available-for-sale investments at June 30, 2023 and December 31, 2022 (in thousands):
The following table summarizes the maturities of the Company’s debt securities classified as available-for-sale investments at June 30, 2023 and December 31, 2022 (in thousands):
There were no proceeds from sales of debt securities available-for-sale (including principal paydowns) for the three and six months ended June 30, 2023 and 2022. The Company determines gains and losses on marketable securities based on specific identification of the securities sold. There were no material realized gains or losses from debt securities available-for-sale during the three and six months ended June 30, 2023 and 2022. No material balances were reclassified out of accumulated other comprehensive loss for the three and six months ended June 30, 2023 and 2022. No unrealized losses on debt securities available-for-sale have been recognized in income for the three and six months ended June 30, 2023 and 2022, as the issuers of such securities were of high credit quality. As of June 30, 2023 the Company did not carry any debt securities available-for-sale that were below the Company's minimum credit rating. All debt securities available-for-sale had a credit rating of A- or better as of June 30, 2023. Equity securities are comprised of investments in mutual funds. The fair value of equity securities at June 30, 2023 and December 31, 2022 was $1.0 million and $0.9 million, respectively. Unrealized gains or losses on equity securities recorded in income during the three and six months ended June 30, 2023 and 2022 were as follows (in thousands):
These unrealized gains or losses are recorded as a component of other income (expense), net. There were no realized gains or losses from equity securities for each of the three and six months ended June 30, 2023 and 2022.
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INVENTORY |
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Inventory Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVENTORY | NOTE 6. INVENTORY Inventories consisted of the following at June 30, 2023 and December 31, 2022 (in thousands):
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PROPERTY AND EQUIPMENT |
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Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPERTY AND EQUIPMENT | NOTE 7. PROPERTY AND EQUIPMENT Property and equipment consisted of the following at June 30, 2023 and December 31, 2022 (in thousands):
Depreciation expense for the three and six months ended June 30, 2023 and 2022 were as follows (in thousands):
Instruments at cost and accumulated depreciation where the Company is the lessor under operating leases consisted of the following at June 30, 2023 and December 31, 2022 (in thousands):
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DEFERRED REVENUE AND REMAINING PERFORMANCE OBLIGATIONS |
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DEFERRED REVENUE AND REMAINING PERFORMANCE OBLIGATIONS | NOTE 8. DEFERRED REVENUE AND REMAINING PERFORMANCE OBLIGATIONS Deferred revenue consists of amounts received for products or services not yet delivered or earned. If we anticipate revenue will not be earned within the following twelve months, the amount is reported as other non-current liabilities. A summary of the balances as of June 30, 2023 and December 31, 2022 follows (in thousands):
We recognized $0.2 million of revenues that were included in the beginning contract liabilities balances for each of the three months ended June 30, 2023 and June 30, 2022 and $0.4 million and $0.3 million for the six months ended June 30, 2023 and June 30, 2022, respectively. No material amount of revenue recognized during the period was from performance obligations satisfied in prior periods. Transaction Price Allocated to Remaining Performance Obligations As of June 30, 2023, $6.1 million of revenue is expected to be recognized from remaining performance obligations. This balance primarily relates to product shipments for reagents sold to customers under sales-type lease agreements. These agreements have between two and four year terms and revenue is recognized as product is shipped, typically on a straight-line basis. The remaining balance relates to executed service contracts that begin as warranty periods expire. These service contracts typically provide for four-year terms and revenue is recognized on a straight-line basis. The Company elects not to disclose the value of unsatisfied performance obligations for (i) contracts with an expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. Commercial Agent Relationship with BD The Company has entered into an exclusive commercial agreement with BD to act as the Company’s agent and representative. As of June 30, 2023, BD has paid the Company exclusivity fees totaling $0.8 million, of which $0.7 million has been amortized as a credit to sales, general and administrative expenses. The remaining $0.1 million remains in deferred income to be amortized in future periods. The Company has recognized $0.5 million in agent fee expense in the six months ended June 30, 2023 associated with partnership-related commercial activity which is recorded to sales, general and administrative expenses.
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
CONVERTIBLE NOTES | NOTE 9. CONVERTIBLE NOTES Convertible Notes The information presented in this section summarizes the data for all of the Company’s convertible notes. The carrying value of the convertible notes at June 30, 2023 and December 31, 2022 consisted of the following (in thousands):
At June 30, 2023 and December 31, 2022 the convertible notes were classified as follows (in thousands):
Interest expense during the three and six months ended June 30, 2023 and 2022 was as follows (in thousands):
(Loss) gain on extinguishment of exchanged convertible notes during the three and six months ended June 30, 2023 and 2022 was as follows (in thousands):
2.50% Convertible Senior Notes due 2023 (the “2.50% Notes”) On March 27, 2018, the Company issued $150.0 million aggregate principal amount of 2.50% Notes. In connection with the offering of the 2.50% Notes, the Company granted the initial purchasers of the Notes a 13-day option to purchase up to an additional $22.5 million aggregate principal amount of the 2.50% Notes on the same terms and conditions. On April 4, 2018 the option was partially exercised, which resulted in $21.5 million of additional proceeds, for total proceeds of $171.5 million. The 2.50% Notes matured on March 15, 2023 (the “Maturity Date”). As of June 30, 2023, approximately $0.7 million aggregate principal amount of 2.50% Notes remains outstanding and in default accruing interest at 2.5% per annum. The Company incurred issuance costs related to the issuance of the 2.50% Notes which were amortized over the five-year contractual term of the 2.50% Notes using the effective interest method. The effective interest rate on the 2.50% Notes, including accretion of the 2.50% Notes to par was 3.2%. Holders had the option to convert the Notes in multiples of $1,000 principal amount at any time prior to December 15, 2022, but only in the following circumstances: •if the Company’s stock price exceeds 130% of the conversion price for 20 of the last 30 trading days of any calendar quarter after June 30, 2018; •during the 5 business day period after any 5 consecutive trading day period in which the 2.50% Notes’ trading price is less than 98% of the product of the common stock price times the conversion rate; or •the occurrence of certain corporate events, such as a change of control, merger or liquidation. At any time on or after December 15, 2022, a holder could have converted its 2.50% Notes in multiples of $1,000 principal amount. Holders of the 2.50% Notes who convert their 2.50% Notes in connection with a make-whole fundamental change (as defined in the Indenture) were, under certain circumstances, entitled to an increase in the conversion rate. In addition, in the event of a fundamental change or event of default prior to the Maturity Date, holders, subject to certain conditions, had the right, at their option, to require the Company to repurchase for cash all or part of the 2.50% Notes at a repurchase price equal to 100% of the principal amount of the 2.50% Notes to be repurchased, plus accrued and unpaid interest up to, but excluding, the repurchase date. As of June 30, 2023, none of the 2.50% Notes outstanding are convertible pursuant to their original terms. None of the 2.50% Notes converted prior to the Maturity Date. As of June 30, 2023, the Company will continue to accrue interest on the remaining outstanding 2.50% Notes. As of June 30, 2023 the amount of accrued interest on the remaining outstanding 2.50% Notes is immaterial. The carrying value of the 2.50% Notes at June 30, 2023 and December 31, 2022 consisted of the following (in thousands):
At June 30, 2023 and December 31, 2022 the 2.50% Notes were classified as follows (in thousands):
Interest expense for the 2.50% Notes during the three and six months ended June 30, 2023 and 2022 were as follows (in thousands):
Forbearance Agreement On March 9, 2023, the Company entered into the Forbearance Agreement, which became effective on March 13, 2023, with the Ad Hoc Noteholder Group holding approximately 85% of the Company’s outstanding 2.50% Notes, the Trustee and any other owner of the 2.50% Notes who executes and delivers to the Company a joinder to the Forbearance Agreement (collectively with the Trustee and Ad Hoc Noteholder Group, the “Counterparties”). Pursuant to the Forbearance Agreement, the members of the Ad Hoc Noteholder Group agreed, and directed the Trustee, to forbear from exercising their rights and remedies under the Indenture in connection with certain events of default under the Indenture, such as (i) failure to timely pay in full the principal of any 2.50% Note when due and payable on March 15, 2023, (ii) failure to pay any interest on any 2.50% Note when due and payable, (iii) failure to convert any 2.50% Notes, (iv) default under any agreement with outstanding indebtedness for money borrowed in excess of $15.0 million and (v) any other breach, default or event of default under the Indenture arising from the failure of the Company to timely pay in full the principal of any 2.50% Note when due and payable on the Maturity Date. The Forbearance Agreement was initially effective for the period commencing on March 13, 2023 and ending on April 21, 2023, the date of the Restructuring Support Agreement. The holders of the 2.50% Notes that joined the Forbearance Agreement received a fee (the “Forbearance Premium”) equal to $5.00 per $1,000 principal amount of the 2.50% Notes held by such party, by executing and delivering a joinder to the Forbearance Agreement to the Company. During the six months ended June 30, 2023 the Ad Hoc Noteholder Group received $0.2 million in Forbearance Premiums. The Forbearance Premium of $0.2 million paid during the six months ended June 30, 2023, was capitalized and amortized to expense for the period commencing on March 13, 2023 through March 31, 2023. Restructuring Support Agreement and June 2023 Exchange Transaction On June 9, 2023, the Company completed the Restructuring Transactions contemplated by the Restructuring Support Agreement whereby the Company (i) exchanged approximately $55.9 million aggregate principal amount of the 2.50% Notes for approximately $56.9 million aggregate principal amount of newly issued 5.00% Notes, which was inclusive of additional 5.00% Notes in respect of interest accrued on the 2.50% Notes from September 15, 2022, for $1.0 million; (ii) issued and sold an additional $10.0 million aggregate principal amount of 5.00% Notes; (iii) repurchased the Secured Note, plus accrued interest, by issuing approximately 3.4 million shares of the Company’s common stock; (iv) issued approximately 0.4 million shares of the Company’s common stock upon conversion of all of the Company’s outstanding Series A Preferred Stock; (v) amended the March 2022 Securities Purchase Agreement (as defined in Note 17) and issued and sold approximately 0.5 million shares of the Company’s common stock for proceeds of $4.0 million; and (vi) entered into a new securities purchase agreement with the Schuler Trust pursuant to which the Schuler Trust is required, prior to December 15, 2023, to either purchase an aggregate of $10 million of the Company’s common stock from the Company or to backstop an underwritten public offering by the Company of its common stock for aggregate proceeds of $10 million, at the Company’s option. See Note 10, Long-Term Debt Related-Party, Note 17, Stockholders' Equity and Note 18, Related-Party Transactions for additional information. As described above, on June 9, 2023, the Company entered into an exchange agreement (the “June 2023 Exchange Transaction”) with certain holders of the Notes. On June 9, 2023 the June 2023 Exchange Transaction was accounted for as an extinguishment which resulted in the $56.9 million in aggregate principal of the 5.00% Notes replacing the $55.9 million of the 2.50% Notes and the $1.0 million of accrued interest expense. The 5.00% Notes were recorded at fair value on initial measurement, while the $55.9 million of the 2.50% Notes and the $1.0 million of accrued interest expense was retired. During the three and six months ended June 30, 2023 the extinguishment of the 2.50% Notes resulted in a loss of $6.6 million. See further discussion of the 5.00% Notes below. March 2022 Exchange Transaction On March 21, 2022, the Company entered into a privately negotiated exchange agreement (the “March 2022 Exchange Agreement”) with a holder of the 2.50% Notes. Under the terms of the March 2022 Exchange Agreement, the note holder agreed to exchange with the Company $14.0 million in aggregate principal amount 2.50% Notes held by it in eight equal tranches as follows for each tranche: (a) 2.26 shares per $1,000 principal amount of 2.50% Notes exchanged, plus (b) an additional number of shares of the Company’s common stock per $1,000 principal amount of 2.50% Notes exchanged equal to the sum, for each of the trading days during a separate agreed upon reference period for each tranche commencing on March 21, 2022 for the first tranche, of the quotient of (i) $15.567 divided by (ii) the daily volume-weighted average price for such trading day (collectively, the “Exchange Transaction”). The closing of the March 2022 Exchange Agreement occurred in eight tranches (“2022 Obligation to Exchange”), with the first closing occurring on March 29, 2022 and the last closing on May 18, 2022. On March 21, 2022 the 2022 Obligation to Exchange the $14.0 million of Notes was accounted for as an extinguishment and was replaced by new notes with an embedded feature (the “2022 New Notes”). The 2022 New Notes were elected to be carried using the fair value option. The 2022 New Notes were recorded at fair value on initial measurement and remeasured at fair value (“mark to market”) at each reporting period with changes in fair value reported in other income and expense, net. This fair value election was exclusive to the 2022 New Notes and did not extend to other 2.50% Notes. At June 30, 2022 the embedded feature was no longer outstanding as the 2022 New Notes were exchanged and the 2022 Obligation to Exchange was retired. As of June 30, 2023 and 2022 no 2.50% Notes were carried using the fair value option. During the six months ended June 30, 2022 the holder of the Notes exchanged approximately $14.0 million in aggregate principal amount of Notes held by the holder for approximately 1.1 million shares of the Company's common stock pursuant to the Exchange Agreement. The legal exchange of the 2.50% Notes resulted in a gain of $3.6 million during the six months ended June 30, 2022. The Company’s common stock was determined to have a fair value of $10.2 million, which was recorded to contributed capital during the six months ended June 30, 2022. Closing of Prepaid Forward In connection with the initial offering of the 2.50% Notes, we entered into a prepaid forward stock repurchase transaction (the “Prepaid Forward”) with a financial institution. Pursuant to the Prepaid Forward, we used approximately $45.1 million of the proceeds from the offering of the 2.50% Notes to pay the prepayment amount. The aggregate number of our common stock underlying the Prepaid Forward is approximately 0.2 million shares (based on the sale price of $24.25). On March 24, 2023, approximately 0.2 million shares of common stock were returned to the Company pursuant to our agreement with the counterparty. On March 27, 2018 and forward, these shares purchased under the Prepaid Forward were treated as treasury stock on the condensed consolidated balance sheet (and not outstanding for purposes of the calculation of basic and diluted earnings per share), but remain outstanding for corporate law purposes, including for purposes of any future stockholders’ votes. 5.00% Convertible Senior Notes due 2026 (the “5.00% Notes”) As described above, on June 9, 2023, the Company entered into the June 2023 Exchange Transaction with holders of the 2.50% Notes. The June 2023 Exchange Transaction was accounted for as an extinguishment which resulted in the 5.00% Notes replacing the 2.50% Notes and associated accrued interest expense. The 5.00% Notes were recorded at fair value on initial measurement, while the 2.50% Notes and the associated accrued interest expense were retired. In addition the Company issued an additional $10.0 million aggregate principal amount of 5.00% Notes, for cash proceeds with certain existing note holders. The 5.00% Notes have an aggregate principal amount of $66.9 million and a maturity date of December 15, 2026 (the “Maturity Date”). The 5.00% Notes bear interest at a rate of 5.00% per annum. The Company shall pay interest on the 5.00% Notes by payment-in-kind (“PIK”), by the issuance of additional 5.00% Notes (“PIK Notes”). The amount shall be payable to holders by increasing the principal amount of each outstanding 5.00% Note by an amount equal to the interest payable for the applicable interest period. The Company will calculate PIK interest semi-annually which is June 15 and December 15, on a compound basis based on the stated rate of 5.00%. The PIK Notes will also incur interest at a rate of 5.00% per annum. The 5.00% Note is secured by substantially all of the assets of the Company and its subsidiaries. Holders of the 5.00% Notes who convert their 5.00% Notes in connection with a make-whole fundamental change (as defined in the Indenture) are, under certain circumstances, entitled to an increase in the conversion rate. If a fundamental change occurs at any time prior to the Maturity Date, each holder shall have the right, at such holder’s option, to require the Company to repurchase for cash all of such holder’s 5.00% Notes, at a repurchase price equal to 100% of the principal amount thereof, plus accrued and unpaid interest. The 5.00% Notes shall not be redeemable by the Company prior to June 15, 2025 except as set forth below: •On or after June 15, 2025 the Company may, at its option, redeem for cash all or a portion of the 5.00% Notes. If the Company does not redeem 100% of the 5.00% Notes then the redeemed amount is subject to minimums as outlined in the Indenture. Redeeming the 5.00% Notes before June 15, 2025 could trigger a make-whole fundamental change as described above. Each holder of the 5.00% Notes has the right at their option, to convert any portion of the 5.00% Notes at an initial conversion rate of 138.88889 shares of common stock per $1,000 principal amount of the 5.00% Notes. Effective October 18, 2023, the initial conversion rate shall be adjusted to a conversion rate calculated based on a conversion price of $7.20 per share of common stock plus 50% of the difference between the Post-Closing VWAP (as defined in the indenture governing the 5.00% Notes) and $7.20 (if such difference is a positive number), provided that in no event shall the adjusted conversion rate be lower than 120.48193 per $1,000 principal amount of the 5.00% Notes, based on a conversion price of $8.30 per share of common stock. The provision of the agreement is collectively referred to as the (“Conversion Option”). The Company cannot require the holder of the 5.00% Notes to convert at any time. As of June 30, 2023 none of the 5.00% Notes have converted. The number of shares of common stock issuable upon conversion of the 5.00% Notes based on the initial conversion rate is 9.3 million shares as of June 30, 2023, and are available for conversion at the holder’s option. The Conversion Option provides the note holders with the option to convert their notes to shares of the Company’s common stock at either the initial conversion rate or an adjusted conversion rate depending on the timing of conversion, and can be exercised at any time until maturity. The Conversion Option provides the Company with a choice of cash, shares, or combination settlement. Management determined the Conversion Option meets the derivative bifurcation criteria under ASC 815 at inception through October 17, 2023, the date at which the conversion rate will become fixed, during which the derivative instrument will be bifurcated and adjusted to fair value through earnings. From end of day October 17, 2023 and thereafter, the Conversion Option will no longer meet the bifurcation criteria and the derivative instrument will cease being bifurcated and will be accounted for based on applicable accounting guidance. The Derivative is an instrument measured at fair value using Level 3 inputs. The Company’s Conversion Option was recorded at fair value at inception, and marked to market as of June 30, 2023. Changes in the fair value of the derivative financial instrument are recognized in gain (loss) on financial instruments, within the condensed consolidated statement of operations and comprehensive loss. The derivative financial instrument activity for the three and six months ended June 30, 2023 and 2022 is comprised of the following (in thousands):
Under ASC 470-50-40, the June 2023 Exchange Transaction qualified as an extinguishment of debt. Under extinguishment accounting, the 2.50% Notes were derecognized and the new instruments, which include the 5.00% Notes and the Conversion Option derivative, were recorded at their respective fair values. The 5.00% Notes represent an instrument measured at fair value on a non-recurring basis using Level 3 inputs. The estimated fair value of the 5.00% Notes on June 9, 2023 is $34.8 million, which included a $6.0 million debt premium. The fair value of the Conversion Option derivative liability of $38.2 million as of the transaction date was recorded as a debt issuance discount at inception on June 9, 2023. The Company incurred issuance costs of $3.0 million. The debt premium, debt discount and debt issuance costs will be amortized using the effective interest method over 3.5 years which is the contractual term of the 5.00% Notes. The effective interest rate on the 5.00% Notes, to par is 27.30%. The carrying value of the 5.00% Notes at June 30, 2023 and December 31, 2022 consisted of the following (in thousands):
At June 30, 2023 and December 31, 2022 the 5.00% Notes were classified as follows (in thousands):
Interest expense for the 5.00% Notes during the three and six months ended June 30, 2023 and 2022 were as follows (in thousands):
As of June 30, 2023, the Company had recorded $0.3 million of accrued interest for the 5.00% Notes. Future principal payments on the 5.00% Notes as of June 30, 2023 are as follows (in thousands):
Fair Value of the 5.00% Notes The 5.00% Notes were measured at fair value on the issuance date of June 9, 2023, and are subsequently measured at fair value for disclosure purposes using Level 3 inputs. As of June 30, 2023, the debt is carried at amortized cost and the fair value is disclosed. The estimated fair value of the 5.00% Notes as of June 30, 2023 was $35.2 million. The fair value of the 5.00% Notes were estimated using a Monte Carlo simulation. The discounted cash flow analysis consisted of the following steps: •The Company modeled the PIK interest of the 5.00% Notes through the Maturity Date; •The Company used a discount rate of 25%, which is consistent with the typical venture capital discount rate; and •The Company discounted the PIK interest and principal payments to determine the value of the 5.00% Notes without the Conversion Option The table below summarizes the significant inputs used to estimate the fair value of the 5.00% Notes as of June 30, 2023:
The volatility used to fair value the Conversion Option is an unobservable input, as volatility is an estimate there are a range of values that could be considered appropriate, which could impact the fair value reported. See Note 4, Fair Value of Financial Instruments for additional information. Fair Value of Conversion Option The Company’s Conversion Option is classified as a derivative financial instrument and carried at fair value using Level 3 inputs. To determine the fair value of the Conversion Option, the Company calculated the difference in the value of the 5.00% Notes with and without the Conversion Option. The fair value of the Conversion Option was estimated using a Monte Carlo simulation. For each path, the Company simulated the stock price over time such that: •At the Reset Date, the Company determined the 60-day average stock price to calculate the conversion price •At each date after the call option start date, the Company used a Tsiveriotis and Fernandes model to determine the continuation value and compare it to the Call Price. If the continuation value exceeds the call price, the Company assumed exercise of the call option. When the call option is exercised, the holders will receive the maximum of the conversion value or the call price. •The valuation also considered the reset conversion price as well as the accrued PIK, the Company determined whether the holder elects to convert the 5.00% Notes at the Maturity Date for the simulation paths where the 5.00% Notes has not been called prior to such date. The table below summarizes the significant inputs used to estimate the fair value of the Conversion Option as of June 30, 2023 and June 9, 2023:
The volatility used to fair value the Conversion Option is an unobservable input, as volatility is an estimate there are a range of values that could be considered appropriate, which could impact the fair value reported. See Note 4, Fair Value of Financial Instruments for additional information.
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LONG-TERM DEBT RELATED-PARTY |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LONG-TERM DEBT RELATED-PARTY | NOTE 10. LONG-TERM DEBT RELATED-PARTY On August 15, 2022, the Company entered into an exchange agreement (the “August 2022 Exchange Agreement”) with the Schuler Trust. Under the terms of the August 2022 Exchange Agreement, the Schuler Trust agreed to exchange with the Company $49.9 million in aggregate principal amount of Notes held by it for (a) the Secured Note in an aggregate principal amount of $34.9 million and (b) a warrant to acquire the Company’s common stock at an exercise price of $21.20 per share (the “Warrant”). The Secured Note had a scheduled maturity date of August 15, 2027 and was repayable upon written demand at any time on or after such date. The Company could, at its option, repay the Secured Note in (i) cash or (ii) in the form of common stock of the Company, in a number of shares that is obtained by dividing the total amount of such payment by $21.20. The Secured Note bore interest at a rate of 5.00% per annum, payable at the option of the Company in the same form, at the earlier of (i) any prepayment of principal and (ii) maturity. The Secured Note was secured by substantially all of the assets of the Company, subject to customary exceptions and limitations, pursuant to a security agreement, dated as of August 15, 2022. The Secured Note did not restrict the incurrence of future indebtedness by the Company but shall become subordinated in right of payment and lien priority upon the request of any future senior lender. On August 15, 2022, the August 2022 Exchange transaction qualified as an extinguishment of debt. Under extinguishment accounting, the 2.50% Notes exchanged by the Schuler Trust were derecognized and the new instruments were issued, which include the Secured Note and the Warrant, which were recorded at their fair values. The estimated fair value of the Secured Note on August 15, 2022 was $16.0 million. This valuation estimated an issuance discount of $18.9 million. The effective interest rate on the Secured Note was 24.60%. The carrying value of the Secured Note at June 30, 2023 and December 31, 2022 consisted of the following (in thousands):
Interest expense in connection with the Secured Note during the three and six months ended June 30, 2023 and 2022 was as follows (in thousands):
Secured Note Amendment and Exchange As discussed in Note 9, Convertible Notes, on June 9, 2023, the Company and the Schuler Trust amended the Secured Note (the “Secured Note Amendment”), which changed its settlement provisions. Pursuant to the Secured Note Amendment, the share conversion price was changed from $21.20 to $10.60, and the Secured Note was contemporaneously settled through the Company’s issuance of approximately 3.4 million shares of common stock. Under ASC 470-50-40, the transaction qualified as an extinguishment of debt. The reacquisition price of the extinguished debt was determined as the fair value of the common stock issued. The closing price of the Company’s common stock on June 9, 2023, the date of the extinguishment, was $7.40 and was used to estimate the fair value of the common stock issued which was $25.4 million while the carrying amount of the Secured Note and associated accrued interest being extinguished was $19.3 million. This resulted in a net loss on extinguishment of $6.1 million, which was recorded to loss on extinguishment of debt with related party on the on the condensed consolidated statement of operations. Warrant The Warrant may be exercised from February 15, 2023 through the earlier of (i) August 15, 2029 and (ii) the consummation of certain acquisition transactions involving the Company, as set forth in the Warrant. The Warrant is exercisable for up to 247,171 shares of common stock, at an exercise price of $21.20 per share. The Warrant meets the criteria for classification in stockholders’ equity and was initially measured at fair value and recorded in equity.
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LOSS PER SHARE |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOSS PER SHARE | NOTE 11. LOSS PER SHARE Basic net loss per common share was determined by dividing net loss applicable to common stockholders by the weighted average common shares outstanding during the period. Basic and diluted net loss per share are the same because all outstanding common stock equivalents have been excluded, as they are anti-dilutive due to the Company’s losses. The following potentially issuable common shares were not included in the computation of diluted net loss per share because they would have an anti-dilutive effect for each of the three and six months ended June 30, 2023 and 2022 (in thousands):
As discussed in Note 9, Convertible Notes, each holder of the 5.00% Notes has the right at their option, to convert any portion of the 5.00% Notes at an initial conversion rate of 138.88889 shares of common stock per $1,000 principal amount of the 5.00% Notes. Effective October 18, 2023, the initial conversion rate shall be adjusted to a conversion rate calculated based on a conversion price of $7.20 per share of common stock plus 50% of the difference between the Post-Closing VWAP (as defined in the indenture governing the 5.00% Notes) and $7.20 (if such difference is a positive number), provided that in no event shall the adjusted conversion rate be lower than 120.48193 per $1,000 principal amount of the 5.00% Notes, based on a conversion price of $8.30 per share of common stock. Holders of the 5.00% Notes who convert their 5.00% Notes in connection with a make-whole fundamental change (as defined in the Indenture) are, under certain circumstances, entitled to an increase in the conversion rate. The number of shares of common stock issuable upon conversion of the 5.00% Notes based on the initial conversion rate is 9.3 million shares as of June 30, 2023, and are available for conversion at the holders’ option.
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EMPLOYEE EQUITY-BASED COMPENSATION |
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Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EMPLOYEE EQUITY-BASED COMPENSATION | NOTE 12. EMPLOYEE EQUITY-BASED COMPENSATION The following table summarizes option activity under the Company's equity-based compensation plans for the six months ended June 30, 2023:
The following table shows summary information for outstanding options and options that are exercisable (vested) as of June 30, 2023:
The following table summarizes RSU and restricted stock award activity for the six months ended June 30, 2023:
The table below summarizes equity-based compensation expense for the three and six months ended June 30, 2023 and 2022 (in thousands):
The table below summarizes share-based compensation cost capitalized to inventory for the three and six months ended June 30, 2023 and 2022 (in thousands):
As of June 30, 2023, unrecognized equity-based compensation expense related to unvested stock options and unvested RSUs was $0.9 million and $8.8 million, respectively. This is expected to be recognized over the years 2023 through 2028. Included in the above-noted RSU and restricted stock award outstanding amounts are performance-based RSUs which vest only upon the achievement of certain targets. Performance-based RSUs contingently vest over a period of 1 to 3 years, depending on the nature of the performance goal, and have contractual lives of 10 years. These units were valued in the same manner as other RSUs, based on the published closing market price on the day before the grant date. However, the Company only recognizes stock compensation expense to the extent that the targets are determined to be probable of being achieved, which triggers the vesting of the performance options. During 2021, the Company granted performance-based RSUs of which 10,330 were outstanding as of June 30, 2023. No activity occurred during the six months ended June 30, 2023, and the targets associated with the performance-based RSUs are not considered probable of being achieved. No share-based compensation cost was recorded for the performance-based RSUs for the six months ended June 30, 2023 and 2022. 2022 Omnibus Equity Incentive Plan During the Company’s Annual Meeting of Stockholders, stockholders approved an amendment to the Company’s 2022 Omnibus Equity Incentive Plan increasing the number of shares of Common Stock reserved and available for grant by 1.6 million, resulting in a total of 3.0 million reserved shares as of June 30, 2023.
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INCOME TAXES |
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Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 13. INCOME TAXES For the six months ended June 30, 2023, the Company recorded a $0.2 million tax expense related to its foreign operations. The Company does not recognize tax benefits from current year tax losses in the U.S. and other foreign jurisdictions. The Company’s tax expense for the six months ended June 30, 2023 differs from the tax expense computed by applying the U.S. statutory tax rate to its year-to-date pre-tax loss of $49.4 million, as no tax benefits were recorded for tax losses generated in the U.S. and other foreign jurisdictions. At June 30, 2023, the Company had deferred tax assets primarily related to U.S. federal and state tax loss carryforwards and a deferred tax liability related to the Notes. The Company provided a valuation allowance against its net deferred tax assets as future realization of such assets is not more likely than not to occur. The Company accounts for uncertain tax positions pursuant to the recognition and measurement criteria under ASC 740, Income Taxes. For the three and six months ended June 30, 2023, we did not note any significant changes to our uncertain tax positions. We do not anticipate significant changes to uncertain tax positions within the next 12 months.
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COMMITMENTS |
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Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS | NOTE 14. COMMITMENTS During April 2022, the Company entered into a non-cancellable purchase obligation with a supplier to acquire raw materials for a total commitment of $11.9 million. Under the terms of this agreement the Company has until March 15, 2027 to take delivery of purchased items. This commitment was entered into to ensure proper material quantities to develop and commercialize our next generation AST platform. As of June 30, 2023, the commitment remains $11.9 million as the Company has only taken immaterial deliveries of inventory.
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LEASES |
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LEASES | NOTE 15. LEASES The following presents supplemental information related to our leases in which we are the lessee for the three and six months ended June 30, 2023 and 2022 (in thousands):
The weighted average remaining lease term on our operating leases is 2.1 years. The weighted average discount rate on those leases is 7.1%. The weighted average remaining lease term on our finance leases is 1.8 years. The weighted average discount rate on those leases is 6.0%. The following presents maturities of lease liabilities in which we are the lessee as of June 30, 2023 (in thousands):
The net investment in sales-type leases, where we are the lessor, is a component of other current assets and other non-current assets in our condensed consolidated balance sheet. As of June 30, 2023, the total net investment in these leases was $2.4 million. The following presents maturities of lease receivables under sales-type leases as of June 30, 2023 (in thousands):
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LEASES | NOTE 15. LEASES The following presents supplemental information related to our leases in which we are the lessee for the three and six months ended June 30, 2023 and 2022 (in thousands):
The weighted average remaining lease term on our operating leases is 2.1 years. The weighted average discount rate on those leases is 7.1%. The weighted average remaining lease term on our finance leases is 1.8 years. The weighted average discount rate on those leases is 6.0%. The following presents maturities of lease liabilities in which we are the lessee as of June 30, 2023 (in thousands):
The net investment in sales-type leases, where we are the lessor, is a component of other current assets and other non-current assets in our condensed consolidated balance sheet. As of June 30, 2023, the total net investment in these leases was $2.4 million. The following presents maturities of lease receivables under sales-type leases as of June 30, 2023 (in thousands):
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GEOGRAPHIC AND REVENUE DISAGGREGATION |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GEOGRAPHIC AND REVENUE DISAGGREGATION | NOTE 16. GEOGRAPHIC AND REVENUE DISAGGREGATION The Company operates as one operating segment. Sales to customers outside the U.S. represented 10% and 14% for the three months ended June 30, 2023 and 2022, respectively, and 12% and 14% for the six months ended June 30, 2023 and June 30, 2022, respectively. As of June 30, 2023 and December 31, 2022, balances due from foreign customers, in U.S. dollars, were $0.6 million and $0.6 million, respectively. The following presents total net sales by geographic territory for the three and six months ended June 30, 2023 and 2022 (in thousands):
The following presents total net sales by line of business for the three and six months ended June 30, 2023 and 2022 (in thousands):
The following presents total net sales by products and services for the three and six months ended June 30, 2023 and 2022 (in thousands):
Lease revenue included in net sales was $0.4 million and $0.6 million for the three months ended June 30, 2023 and 2022, respectively, and $0.6 million and $1.1 million for the six months ended June 30, 2023 and 2022, respectively. The following presents property and equipment, net by geographic territory (in thousands):
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STOCKHOLDERS' EQUITY |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCKHOLDERS' EQUITY | NOTE 17. STOCKHOLDERS' EQUITY March 2022 Exchange Transaction During the six months ended June 30, 2022, a holder of the 2.50% Notes exchanged approximately $14.0 million in aggregate principal amount of 2.50% Notes held by the holder for approximately 1.1 million shares of the Company’s common stock pursuant to the March 2022 Exchange Agreement. The Company’s common stock was determined to have a value of $10.2 million, which was recorded to contributed capital during the six months ended June 30, 2022. See Note 9, Convertible Notes for additional information. Conversion of Series A Preferred Stock to Common Stock On September 22, 2021, the Company entered into a securities purchase agreement (the “September 2021 Securities Purchase Agreement”) with the Schuler Purchasers for the issuance and sale by the Company of an aggregate of approximately 4.0 million shares of the Company’s Series A Preferred Stock, par value $0.001 per share (the “Series A Preferred Shares”). Pursuant to the September 2021 Securities Purchase Agreement, the Schuler Purchasers agreed to purchase the Series A Preferred Shares at a purchase price of $7.70 per share for an aggregate purchase price of approximately $30.5 million which was recorded to contributed capital when it was received in 2022. Each share of Series A Preferred Shares was convertible, at the option of the holder, into one share of the Company’s common stock. As discussed in Note 9, Convertible Notes, on June 9, 2023, the Schuler Purchasers exercised their right to convert a total of approximately 4.0 million shares of Series A Preferred Shares to approximately 4.0 million shares of the Company’s common stock, which were subsequently restated to approximately 0.4 million shares in conjunction with the reverse stock split. All of the Company’s Series A Preferred Shares was converted into common stock and no Series A Preferred Shares was outstanding as of June 30, 2023. During the three and six months ended the amounts associated with the Company’s Series A Preferred Shares was reclassified to common stock as presented on the statement of stockholders’ deficit. March 2022 Securities Purchase Agreement On March 24, 2022, the Company entered into a securities purchase agreement (the “March 2022 Securities Purchase Agreement”) with the Schuler Trust for the issuance and sale by the Company of an aggregate of approximately 0.2 million shares of the Company’s common stock to the Schuler Trust in an offering (the “Private Placement”) exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended, and Rule 506 promulgated thereunder. Pursuant to the March 2022 Securities Purchase Agreement, the Schuler Trust agreed to purchase the shares at a purchase price (determined in accordance with Nasdaq rules relating to the “market value” of the Company’s common stock) of $16.40 per share, for an aggregate purchase price of $4.0 million. On March 24, 2022, the Company classified the March 2022 Securities Purchase Agreement as an equity forward agreement that met the definition of a freestanding derivative financial instrument initially classified in stockholders’ deficit. The value of this equity forward agreement was considered immaterial at inception. The Company and the Schuler Trust agreed to extend the closing date of the March 2022 Securities Purchase Agreement several times under the original terms of the Private Placement. As discussed in Note 9, Convertible Notes, on June 9, 2023, the Company and the Schuler Trust amended the March 2022 Securities Purchase Agreement, which changed the terms of settlement. The amendment changed the closing date to June 9, 2023, amended the price per share from $16.40 to $8.20, upon which the Company issued approximately 0.5 million shares of common stock to the Schuler Trust for the same proceeds of $4.0 million. The Company determined the amendment was a modification of a freestanding equity classified instrument financial instrument. The share price change from $16.44 to $8.20, with no changes to the total proceeds of $4.0 million, resulted in the Schuler Trust receiving approximately 0.2 million more shares than the Schuler Trust would have received prior to the modification. The closing price of the Company’s common stock on June 9, 2023, the date of the modification was $7.40 and was used to estimate the fair value of the additional common stock issued. The fair value of the additional shares issued is $1.8 million, which was recorded to loss on extinguishment of debt with related party on the condensed consolidated statement of operations. Schuler Purchase Obligation As discussed in Note 9, Convertible Notes, on June 9, 2023, the Company and the Schuler Trust entered into the Schuler Purchase Obligation. Pursuant to the Schuler Purchase Obligation, the Schuler Trust is required, at the Company’s option, to either purchase approximately 1.4 million shares of common stock from the Company at $7.20 per share for an aggregate purchase price of $10.0 million or to backstop a public offering by the Company of common stock for aggregate proceeds of $10.0 million at the public offering stock price. If the Company elects to conduct a public offering of common stock and other investors purchase less than $10.0 million shares of common stock by December 15, 2023, the Schuler Trust will have the obligation to purchase $10.0 million shares of common stock at the public offering stock price, less the amount of common stock purchased by other investors, and will have the right to purchase additional shares of common stock such that the total amount of common stock is equal to $10.0 million of shares of common stock. If the Company elects to conduct a public offering of common stock and other investors purchase $10.0 million of shares of common stock by December 15, 2023, the Schuler Trust shall have the right, but not the obligation, to purchase up to $10.0 million of shares of common stock at the public offering stock price for the backstopped offering up to a maximum aggregate purchase by the Schuler Trust of $10.0 million of common stock. Management determined the Schuler Purchase Obligation meets the criteria of a freestanding financial instrument at inception on June 9, 2023 through December 15, 2023, which is the date the Schuler Purchase Obligation expires. The Schuler Purchase Obligation is recorded as an asset at fair value, and marked to market at each reporting period. At inception, June 9, 2023 the value of the Schuler Purchase Obligation was $1.3 million, which was recorded to loss on extinguishment of debt with related party on the on the condensed consolidated statement of operations. The Company recorded marked to market losses of $0.4 million during the three and six months June 30, 2023, which was recorded to losses on financial instruments on the condensed consolidated statement of operations. As of June 30, 2023 the carrying value of the Schuler Purchase Obligation was $0.9 million, which was carried in other current assets on the condensed consolidated balance sheet. To determine the fair value of the Schuler Purchase Obligation, the Company used a Cox-Ross-Rubinstein binomial tree model to value the American put option. The table below summarizes the significant inputs used to estimate the fair value of the Schuler Purchase Obligation as of June 30, 2023 and June 9, 2023:
The volatility used to fair value the Conversion Option is an unobservable input, as volatility is an estimate there are a range of values that could be considered appropriate, which could impact the fair value reported. See Note 4, Fair Value of Financial Instruments for additional information. Increase in the Total Number of Authorized Shares In May 2023, we sought and obtained authorization from stockholders to increase the total number of authorized shares of common stock under our certificate of incorporation by 250.0 million for a total of 450.0 million shares. The Company’s authorized shared of common stock was unaffected by the reverse stock split.
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RELATED-PARTY TRANSACTIONS |
6 Months Ended |
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Jun. 30, 2023 | |
Related Party Transactions [Abstract] | |
RELATED-PARTY TRANSACTIONS | NOTE 18. RELATED-PARTY TRANSACTIONS March 2022 Securities Purchase Agreement As discussed in Note 17, Stockholders' Equity, on March 24, 2022, the Company entered into the March 2022 Securities Purchase Agreement with the Schuler Trust for the issuance and sale by the Company of an aggregate of 0.2 million shares of the Company’s common stock to the Schuler Trust in a Private Placement. Pursuant to the March 2022 Securities Purchase Agreement, the Schuler Trust agreed to purchase the shares at a purchase price of $16.40 per share, for an aggregate purchase price of $4.0 million. On June 9, 2023, the Company and the Schuler Trust amended the March 2022 Securities Purchase Agreement, which changed the terms of settlement. The amendment changed the closing date to June 9, 2023, amended the price per share from $16.40 to $8.20, upon which the Company issued approximately 0.5 million shares of common stock to the Schuler Trust for the same proceeds of $4.0 million. Jack Schuler, who serves as a member of the Company’s board of directors, is the sole trustee of the Schuler Trust. Secured Note Amendment and Exchange As discussed in Note 10, Long-Term Debt Related-Party, on June 9, 2023, the Company and the Schuler Trust amended the Secured Note, which changed its settlement provisions. Pursuant to the Secured Note Amendment, the share conversion price was changed from $21.20 to $10.60, and the Secured Note was contemporaneously settled through the Company’s issuance of approximately 3.4 million shares of common stock. Conversion of Series A Preferred Stock to Common Stock As discussed in Note 17, Stockholders' Equity, on June 9, 2023, the Schuler Purchasers exercised their right to convert a total of approximately 4.0 million shares of Series A Preferred Shares to approximately 4.0 million shares of the Company’s common stock which were subsequently restated to approximately 0.4 million shares in conjunction with the reverse stock split. The Schuler Purchasers are related to Jack W. Schuler but are not affiliates of his. Schuler Purchase Obligation As discussed in Note 17, Stockholders' Equity, on June 9, 2023, the Company and the Schuler Trust entered into the Schuler Purchase Obligation. Pursuant to the Schuler Purchase Obligation, the Schuler Trust is required, at the Company’s option, to either purchase approximately 1.4 million shares of common stock from the Company at $7.20 per share for an aggregate purchase price of $10.0 million or to backstop a public offering by the Company of common stock for aggregate proceeds of $10.0 million at the public offering stock price. If the Company elects to conduct a public offering of common stock and other investors purchase less than $10.0 million shares of common stock by December 15, 2023, the Schuler Trust will have the obligation to purchase $10.0 million shares of common stock at the public offering stock price, less the amount of common stock purchased by other investors, and will have the right to purchase additional shares of common stock such that the total amount of common stock purchased by the Schuler Trust equals $10.0 million of shares of common stock. If the Company elects to conduct a public offering of common stock and other investors purchase $10.0 million of shares of common stock by December 15, 2023, the Schuler Trust shall have the right, but not the obligation, to purchase up to $10.0 million of shares of common stock at the public offering stock price for the backstopped offering up to a maximum aggregate purchase by the Schuler Trust of $10.0 million of common stock. Schuler Trust Issuance Costs As part of the Restructuring Transactions discussed in Note 9, Convertible Notes, the Company incurred and paid legal fees of $0.1 million on behalf of the Schuler Trust.
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SUBSEQUENT EVENTS |
6 Months Ended |
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Jun. 30, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 19. SUBSEQUENT EVENTS The Company evaluates events that have occurred after the balance sheet date but before the financial statements are issued. Nasdaq Minimum Bid Price Requirement On January 5, 2023, the Company received a deficiency letter from the Listing Qualifications Department (the “Staff”) of The Nasdaq Stock Market (“Nasdaq”) notifying the Company that, for the last 30 consecutive business days, the closing bid price for the Company’s common stock had been below the minimum $1.00 per share requirement for continued inclusion on The Nasdaq Capital Market (the “Capital Market”) pursuant to Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Requirement”). At that time, the Company was granted a period of 180 calendar days, or until July 5, 2023, to regain compliance with the Minimum Bid Price Requirement. On July 6, 2023, the Company received a determination letter from the Staff notifying the Company that it had not regained compliance with the Minimum Bid Price Requirement as of July 5, 2023 in compliance with Nasdaq Listing Rule 5550(a)(2). The Company requested a hearing before the Panel to appeal the Staff’s determination and present a plan to regain compliance with the Minimum Bid Price Requirement. As part of the Company’s compliance plan to regain compliance with the Minimum Bid Price Requirement, the Company implemented a reverse stock split. On July 11, 2023, the Company effected a one-for-ten reverse stock split (“Reverse Stock Split”) of the Company’s common stock. On July 31, 2023, the Company received a letter from the Nasdaq Office of General Counsel notifying the Company that the previously reported bid price deficiency had been cured and that the Company was in compliance with all applicable Nasdaq listing standards. Accordingly, the previously reported hearing request by the Company before a Nasdaq Hearings Panel was cancelled, and the Company’s common stock will continue to be listed and traded on The Nasdaq Capital Market. Conversion of 5.00% Notes into Common Stock Starting July 7, 2023, certain holders of the 5.00% Notes exercised their right, to convert a portion of their 5.00% Notes at an initial conversion rate of 138.88889 shares of common stock per $1,000 principal amount of the 5.00% Notes, pursuant to the terms outlined in Note 9, Convertible Notes, further described as the Conversion Option. The various holders of the Company’s 5.00% Notes converted an aggregate principal amount of $0.7 million, for approximately 0.1 million shares of common stock.
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ORGANIZATION AND NATURE OF BUSINESS; BASIS OF PRESENTATION; PRINCIPLES OF CONSOLIDATION; SIGNIFICANT ACCOUNTING POLICIES (Policies) |
6 Months Ended |
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Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) and applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as filed with the SEC on March 31, 2023. The condensed consolidated balance sheet as of December 31, 2022 included herein was derived from the audited financial statements as of that date but does not include all disclosures such as notes required by U.S. GAAP. The accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods presented, but are not necessarily indicative of the results of operations to be anticipated for the entire year ending December 31, 2023, or any future period. All amounts are rounded to the nearest thousand dollars unless otherwise indicated. On July 11, 2023, the Company effected a one-for-ten reverse stock split. Consequently, on the Company’s condensed consolidated balance sheet, the aggregate par value of the issued common stock was reduced by reclassifying the par value amount of the eliminated shares of common stock to additional paid-in capital. All per share amounts and outstanding shares, including all common stock equivalents (stock options), have been retroactively restated in the condensed consolidated financial statements and in the Notes to the condensed consolidated financial statement for all periods presented to reflect the reverse stock split.
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Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries after elimination of intercompany transactions and balances.
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Use of Estimates | Use of Estimates The preparation of the Company’s condensed consolidated financial statements requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The more significant areas requiring the use of management estimates and assumptions relate to accounts receivable, inventory, property and equipment, accrued liabilities, warranty liabilities, derivatives, convertible notes, tax valuation accounts, equity-based compensation, warrants, revenue and leases. Actual results could differ materially from those estimates.
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Estimated Fair Value of Financial Instruments | Estimated Fair Value of Financial Instruments The Company follows ASC 820, Fair Value Measurement, which has defined fair value and requires the Company to establish a framework for measuring and disclosing fair value. The framework requires the valuation of assets and liabilities subject to fair value measurements using a three-tiered approach and fair value measurement be classified and disclosed in one of the following three categories: •Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; •Level 2: Quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; •Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). The carrying amounts of financial instruments such as cash and cash equivalents, trade accounts receivable, prepaid expenses, other current assets, accounts payable, accrued liabilities, and other current liabilities approximate the related fair values due to the short-term maturities of these instruments. See Note 4, Fair Value of Financial Instruments, for further information and related disclosures regarding the Company’s fair value measurements. The 2.50% Notes matured on March 15, 2023 and became due and payable on such date. As of June 30, 2023, $0.7 million of the 2.50% Notes had not been converted and remained outstanding and in default. The carrying amount of these 2.50% Notes approximates the related fair value due to the instrument being fully matured and payable on June 30, 2023. As of December 31, 2022, the Notes were instruments measured at fair value using Level 2 inputs, as the Notes were traded on an active market with observable inputs. See Note 9, Convertible Notes for further details on the 2.50% Notes. The 5.00% Notes are instruments measured at fair value at initial measurement using Level 3 inputs. As of June 30, 2023, the debt is carried at amortized cost and the fair value is disclosed. See Note 9, Convertible Notes for further details on the 5.00% Notes. The Company’s 5.00% Notes conversion option (the “Conversion Option”) met the bifurcation criteria under, Derivatives and Hedging (“Topic 815”), at inception and through June 30, 2023, and must be recorded at fair value, and marked to market at each reporting period until it becomes fixed. The Conversion Option is considered a derivative that is measured at fair value using Level 3 inputs. See Note 9, Convertible Notes for further details on the Conversion Option. During the three months ended June 30, 2023, the Company entered into a securities purchase agreement with the Schuler Trust to purchase common stock from the Company at the Company’s option (the “Schuler Purchase Obligation”). The Schuler Purchase Obligation was determined to be a freestanding financial instrument that must be recorded as an asset at fair value, and marked to market at each reporting period that is outstanding using Level 3 inputs. See Note 17, Stockholders' Equity for further details on the Schuler Purchase Obligation. During the three months ended June 30, 2023, the Company fully extinguished the Secured Notes held by the Schuler Trust by exchanging the Secured Notes for common stock. As of December 31, 2022, the Secured Notes were instruments carried at amortized cost while fair value was disclosed using Level 3 inputs. See Note 10, Long-Term Debt Related-Party for further details on the Secured Notes.
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Cash and Cash Equivalents | Cash and Cash Equivalents All highly liquid investments with an original maturity of three months or less at time of purchase are considered to be cash equivalents. Cash and cash equivalents include overnight repurchase agreement accounts and other investments. As part of the Company’s cash management process, excess operating cash is invested in overnight repurchase agreements with its bank. Repurchase agreements and other investments classified as cash and cash equivalents are not deposits and are not insured by the U.S. Government, the FDIC or any other government agency and involve investment risk including possible loss of principal. Notwithstanding the possibility of bank failures, we believe that as a result of the Company’s selected banks, diversified holdings strategy, and the U.S. Government’s continued support to stabilize the banking system, such as steps taken in March 2023 as a result of certain bank failures, that the market risk arising from holding these financial instruments is minimal.
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Investments | Investments The Company invests in various debt and equity securities which are primarily held in the custody of major financial institutions. Debt securities consist of certificates of deposit, U.S. government and agency securities, commercial paper, and corporate notes and bonds. Equity securities consist of mutual funds. The Company records these investments in the condensed consolidated balance sheet at fair value. Unrealized gains or losses for debt securities available-for-sale are included in accumulated other comprehensive loss, a component of stockholders’ deficit. Unrealized gains or losses for equity securities are included in other income (expense), net, a component of condensed consolidated statements of operations and comprehensive loss. The Company considers all debt securities to be available-for-sale, including those with maturity dates beyond 12 months, as they are available to support current operational liquidity needs. The Company classifies its investments as current based on the nature of the investments and their availability for use in current operations. We perform an assessment to determine whether there have been any events or economic circumstances to indicate that a debt security available-for-sale in an unrealized loss position has suffered impairment as a result of credit loss or other factors. A debt security is considered impaired if its fair value is less than its amortized cost basis at the reporting date. If we intend to sell the debt security or if it is more-likely-than-not that we will be required to sell the debt security before the recovery of its amortized cost basis, the impairment is recognized and the unrealized loss is recorded as a direct write-down of the security's amortized cost basis with an offsetting entry to earnings. If we do not intend to sell the debt security or believe we will not be required to sell the debt security before the recovery of its amortized cost basis, the impairment is assessed to determine if a credit loss component exists. We use a discounted cash flow method to determine the credit loss component. In the event a credit loss exists, an allowance for credit losses is recorded in earnings for the credit loss component of the impairment while the remaining portion of the impairment attributable to factors other than credit loss is recognized, net of tax, in accumulated other comprehensive income (loss). The amount of impairment recognized due to credit factors is limited to the excess of the amortized cost basis over the fair value of the security.
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Inventory | Inventory Inventory is stated at the lower of cost or net realizable value. The Company determines the cost of inventory using the first-in, first-out method. The Company estimates the recoverability of inventory by reference to internal estimates of future demands and product life cycles, including expiration. The Company periodically analyzes its inventory levels to identify inventory that may expire prior to expected sale or has a cost basis in excess of its estimated realizable value and records a charge to expense for such inventory as appropriate. We charge cost of sales for inventory provisions to write-down our inventory to the lower of cost or net realizable value or for obsolete or excess inventory. Most of our inventory provisions relate to excess quantities of products, based on our inventory levels and future product purchase commitments compared to assumptions about future demand and market conditions. Once inventory has been written-off or written-down, it creates a new cost basis for the inventory that is not subsequently written-up.
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Accounts Receivable | Accounts Receivable Accounts receivable consist of amounts due to the Company for sales to customers and are based on what we expect to collect in exchange for goods and services. Receivables are considered past due based on the contractual payment terms and are written off if reasonable collection efforts prove unsuccessful. We maintain an allowance for credit losses for expected uncollectible accounts receivable, which is recorded as an offset to accounts receivable and changes in such are classified as general and administrative expense in the consolidated statements of operations. We assess collectability by reviewing accounts receivable on a collective basis where similar characteristics exist and on an individual basis when we identify specific customers with known disputes or collectability issues. In determining the amount of the allowance for credit losses, we consider historical collectability and make judgments about the creditworthiness of customers based on credit evaluations. Our customers typically have good credit quality. We also consider customer-specific information, current market conditions and reasonable and supportable forecasts of future economic conditions to inform adjustments to historical loss data.
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Property and Equipment | Property and Equipment Property and equipment are recorded at cost. Maintenance and repairs are charged to expense as incurred and expenditures for major improvements are capitalized. Gains and losses from retirement or replacement are included in costs and expenses. Depreciation of property and equipment is computed using the straight-line method over the estimated useful life of the assets, ranging from to seven years. Leasehold improvements are depreciated over the remaining life of the lease or the life of the asset, whichever is less. Instruments Classified as Property and Equipment Property and equipment includes Accelerate Pheno systems (also referred to as instruments) used for sales demonstrations, instruments under rental agreements and instruments used for research and development. Depreciation expense for instruments used for sales demonstrations is recorded as a component of sales, general and administrative expense. Depreciation expense for instruments placed at customer sites pursuant to reagent rental agreements is recorded as a component of cost of sales. Depreciation expense for instruments used in our laboratory and research is recorded as a component of research and development expense. The Company retains title to these instruments and depreciates them over five years. Losses from the retirement of returned instruments are included in costs and expenses. The Company evaluates the recoverability of the carrying amount of its instruments whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable, and at least annually. This evaluation is based on our estimate of future cash flows and the estimated fair value of such long-lived assets, and provides for impairment if such undiscounted cash flows or the estimated fair value are insufficient to recover the carrying amount of instruments. No impairment charges have been recorded for the three and six months ended June 30, 2023 and 2022.
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Long-lived Assets | Long-lived Assets Long-lived assets and certain identifiable intangibles to be held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company continuously evaluates the recoverability of its long-lived assets based on estimated future cash flows from and the estimated fair value of such long-lived assets, and provides for impairment if such undiscounted cash flows or the estimated fair value are insufficient to recover the carrying amount of the long-lived asset.
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Warranty Reserve | Warranty Reserve Instruments are typically sold with a one year limited warranty, while kits and accessories are typically sold with a sixty days limited warranty. Accordingly, a provision for the estimated cost of the limited warranty repair is recorded at the time revenue is recognized. Our estimated warranty provision is based on our estimate of future repair events and the related estimated cost of repairs. The Company periodically assesses the adequacy of the warranty reserve and adjusts the amount as necessary. The cost incurred for these provisions is included in cost of sales on the condensed consolidated statements of operations and comprehensive loss.
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Convertible Notes | Convertible Notes The Company follows Accounting Standards Update (“ASU”) 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40). The Notes are accounted for as a liability measured at their amortized cost. Interest expense is comprised of (1) cash interest payments, (2) amortization of any debt discounts or premiums based on the original offering, and (3) amortization of any debt issuance costs. Gain or loss on extinguishment of Notes is calculated as the difference between the (i) fair value of the consideration transferred and (ii) the carrying value of the debt at the time of repurchase, conversion or settlement.
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Revenue Recognition | Revenue Recognition The Company recognizes revenue when control of the promised good or service is transferred to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Sales taxes are excluded from revenues. The Company determines revenue recognition through the following steps: •Identification of the contract with a customer •Identification of the performance obligations in the contract •Determination of the transaction price •Allocation of the transaction price to the performance obligations •Recognition of revenue as we satisfy a performance obligation Product revenue is derived from the sale or rental of instruments and sales of related consumable products. When an instrument is sold, revenue is generally recognized upon installation of the unit consistent with contract terms, which do not include a right of return. When a consumable product is sold, revenue is generally recognized upon shipment. Invoices are generally issued when revenue is recognized. Payment terms vary by the type and location of the customer and the products or services offered. The term between invoicing and when payment is due is not significant. Service revenue is derived from the sale of extended service agreements which are generally non-cancellable. This revenue is recognized on a straight-line basis over the contract term beginning on the effective date of the contract because the Company is standing ready to provide services. Invoices are generally issued annually and coincide with the beginning of individual service terms. The Company’s contracts with customers may include multiple performance obligations. For such arrangements, the Company allocates revenue to each performance obligation based on its relative standalone selling price. The Company generally determines relative standalone selling prices based on the price charged to customers for each individual performance obligation. Sales commissions earned by the Company’s sales force are considered incremental and recoverable costs of obtaining a contract with a customer. The Company has determined these costs would have an amortization period of less than one year and has elected to recognize them as an expense when incurred. Contract asset opening and closing balances were immaterial for the three and six months ended June 30, 2023. Gross Profit and Gross Margin Gross profit consists of total revenue, net of allowances, less cost of sales. Cost of sales includes cost of materials, direct labor, equity-based compensation, facility and other manufacturing overhead costs for consumable tests and instruments sold to customers. Cost of sales for instruments also includes depreciation on revenue generating instruments that have been placed with our customers under a reagent rental agreement. Cost of sales includes repair and maintenance cost for instruments covered by a service agreement or instruments covered by a reagent rental agreement. Cost of sales also includes warranty related costs. The Company manufactures pre-launch inventory in advance of regulatory approval. This inventory is expensed before an economic benefit is probable. Pre-launch inventory sold to customers (not capitalized and instead expensed in a previous year) during each of the three and six months ended June 30, 2023 was none and $0.1 million, respectively. Pre-launch inventory sold to customers (not capitalized and instead expensed in a previous year) during each of the three and six months ended June 30, 2022 was $0.2 million and $0.3 million, respectively. Shipping and Handling Shipping and handling costs billed to customers are included as a component of revenue. The corresponding expense incurred with third party carriers is included as a component of sales, general and administrative costs on the consolidated statements of operations and comprehensive loss. Commercial Agent Relationship with Becton, Dickinson and Company (“BD”) The Company has entered into an exclusive commercial agreement with BD to act as the Company’s agent and representative. The purpose of this agreement is to establish an on-going commercialization of the Company’s products. The Company is classified as the principal and BD as the agent. BD shall pay the Company a fee in multiple installments for exclusive rights, while the Company will pay BD an agent fee based on the Company’s revenues. The Company accounts for agent fees consistent with how it accounts for sales commissions as described above. In most instances the agent fees are determined to be costs that would have an amortization period of less than one year and the Company has elected to recognize them as an expense when incurred. The agent fee is a component of sales, general and administrative expenses, within the condensed consolidated statement of operations and comprehensive loss. The Company accounts for the fee from BD as a deferred liability when the cash is received. The deferred liability is then amortized using estimates to reduce the amount of agent fee expense for the period. The Company uses forecasted revenue to estimate the amount of deferred liability to amortize within a period. The deferred liability is a component of deferred revenue, within the condensed consolidated balance sheet, while the corresponding amortization is charged to sales, general and administrative expenses, within the condensed consolidated statement of operations and comprehensive loss. See Note 8, Deferred Revenue and Remaining Performance Obligations, for further information and related disclosures.
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Leases as Lessee | Leases The Company accounts for leases in accordance with ASC 842, Leases. The Company determines if an arrangement is or contains a lease and the type of lease at inception. The Company classifies leases as finance leases (lessee) or sales-type leases (lessor) when there is either a transfer of ownership of the underlying asset by the end of the lease term, the lease contains an option to purchase the asset that we are reasonably certain will be exercised, the lease term is for the major part of the remaining economic life of the asset, the present value of the lease payments and any residual value guarantee equals or substantially exceeds all the fair value of the asset, or the asset is of such a specialized nature that it will have no alternative use to the lessor at the end of the lease term. Payments contingent on future events (i.e., based on usage) are considered variable and excluded from lease payments for the purposes of classification and initial measurement. Several of our leases include options to renew or extend the term upon mutual agreement of the parties and others include one-year extensions exercisable by the lessee. None of our leases contain residual value guarantees, restrictions, or covenants. To determine whether a contract contains a lease, the Company uses its judgment in assessing whether the lessor retains a material amount of economic benefit from an underlying asset, whether explicitly or implicitly identified, which party holds control over the direction and use of the asset, and whether any substantive substitution rights over the asset exist. Leases as Lessee Operating leases are included in right-of-use (“ROUs”) assets and corresponding lease liabilities, and finance leases are included in ROU assets and corresponding lease liabilities within our condensed consolidated balance sheets. These assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and their related liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Typically, we use our incremental borrowing rate based on the information available at commencement in determining the present value of lease payments. We use the implicit rate when readily determinable. ROU assets are net of lease payments made and exclude lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term, which may include options to extend or terminate the lease when it is reasonably certain that we will exercise the option. Our operating leases consist primarily of leased office, factory, and laboratory space in the U.S. and office space in Europe, have between and six-year terms, and typically contain penalizing, early-termination provisions. Our finance leases consist of leased equipment and have three-year terms.
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Leases as Lessor | Leases The Company accounts for leases in accordance with ASC 842, Leases. The Company determines if an arrangement is or contains a lease and the type of lease at inception. The Company classifies leases as finance leases (lessee) or sales-type leases (lessor) when there is either a transfer of ownership of the underlying asset by the end of the lease term, the lease contains an option to purchase the asset that we are reasonably certain will be exercised, the lease term is for the major part of the remaining economic life of the asset, the present value of the lease payments and any residual value guarantee equals or substantially exceeds all the fair value of the asset, or the asset is of such a specialized nature that it will have no alternative use to the lessor at the end of the lease term. Payments contingent on future events (i.e., based on usage) are considered variable and excluded from lease payments for the purposes of classification and initial measurement. Several of our leases include options to renew or extend the term upon mutual agreement of the parties and others include one-year extensions exercisable by the lessee. None of our leases contain residual value guarantees, restrictions, or covenants. To determine whether a contract contains a lease, the Company uses its judgment in assessing whether the lessor retains a material amount of economic benefit from an underlying asset, whether explicitly or implicitly identified, which party holds control over the direction and use of the asset, and whether any substantive substitution rights over the asset exist. Leases as Lessor The Company leases instruments to customers under “reagent rental” agreements, whereby the customer agrees to purchase consumable products over a stated term, typically five years or less, for a volume-based price that includes an embedded rental for the instruments. When collectability is probable, that amount is recognized as income at lease commencement for sales-type leases and as product is shipped, typically in a straight–line pattern, over the term for operating leases, which typically include a termination without cause or penalty provision given a short notice period. Consideration is allocated between lease and non-lease components based on stand-alone selling price in accordance with ASC 606, Revenue from Contracts with Customers. Net investment in sales-type leases are included within our condensed consolidated balance sheets as a component of other current assets and other non-current assets, which include the present value of lease payments not yet received and the present value of the residual asset, which are determined using the information available at commencement, including the lease term, estimated useful life, rate implicit in the lease, and expected fair value of the instrument.
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Nonqualified Cash Deferral Plan | Nonqualified Cash Deferral Plan The Company’s Cash Deferral Plan (the “Deferral Plan”) provides certain key employees with an opportunity to defer the receipt of such participant's base salary. The Deferral Plan is intended to be a nonqualified deferred compensation plan that complies with the provisions of Section 409A of the Internal Revenue Code. All of the investments held in the Deferral Plan are equity securities consisting of mutual funds and recorded at fair value with changes in the investments’ fair value recognized as earnings in the period they occur. The corresponding liability for the Deferral Plan is included in other non-current liabilities in the condensed consolidated balance sheet.
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Equity-Based Compensation | Equity-Based Compensation The Company may award stock options, restricted stock units (“RSUs”), performance-based awards and other equity-based instruments to its employees, directors and consultants. Compensation cost related to equity-based instruments is based on the fair value of the instrument on the grant date, and is recognized over the requisite service period on a straight-line basis over the vesting period for each tranche (an accelerated attribution method). Performance-based awards vest based on the achievement of performance targets. Compensation costs associated with performance-based awards are recognized over the requisite service period based on probability of achievement. Performance-based awards require management to make assumptions regarding the likelihood of achieving performance targets. The Company estimates the fair value of service based and performance-based stock option awards, including modifications of stock option awards, using the Black-Scholes option pricing model. This model derives the fair value of stock options based on certain assumptions related to expected stock price volatility, expected option life, risk-free interest rate and dividend yield. •Volatility: The expected volatility is based on the historical volatility of the Company's stock price over the most recent period commensurate with the expected term of the stock option award. •Expected term: The estimated expected term for employee awards is based on a simplified method that considers an insufficient history of employee exercises. For consultant awards, the estimated expected term is the same as the life of the award. •Risk-free interest rate: The risk-free interest rate is based on published U.S. Treasury rates for a term commensurate with the expected term. •Dividend yield: The dividend yield is estimated as zero as the Company has not paid dividends in the past and does not have any plans to pay any dividends in the foreseeable future. The Company records the fair value of RSUs or stock grants based on the published closing market price on the day before the grant date. The Company accounts for forfeitures as they occur rather than on an estimated basis.
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Accounting for Derivatives | Accounting for Derivatives The Company identified a derivative financial instrument in connection with the Company’s 5.00% Notes Conversion Option. The Company’s derivative is recorded at fair value on the condensed consolidated balance sheet as a current derivative liability and changes in the fair value of the derivative financial instrument is recognized in gain (loss) on financial instruments, within the condensed consolidated statement of operations and comprehensive loss, depending on the changes in fair value. See Note 9, Convertible Notes for further information.
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Deferred Tax | Deferred Tax Deferred tax assets and liabilities are recorded for the estimated future tax effects of temporary differences between the tax basis of assets and liabilities and amounts reported in the accompanying condensed consolidated balance sheet. The change in deferred tax assets and liabilities for the period represents the deferred tax provision or benefit for the period. Effects of changes in enacted tax laws in deferred tax assets and liabilities are reflected as an adjustment to the tax provision or benefit in the period of enactment. The Company follows the provisions of ASC 740, Income Taxes, to account for any uncertainty in income taxes with respect to the accounting for all tax positions taken (or expected to be taken) on any income tax return. This guidance applies to all open tax periods in all tax jurisdictions in which the Company is required to file an income tax return. Under U.S. GAAP, in order to recognize an uncertain tax benefit the taxpayer must be more likely than not certain of sustaining the position, and the measurement of the benefit is calculated as the largest amount that is more likely than not to be realized upon resolution of the position. Interest and penalties, if any, would be recorded within tax expense.
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Foreign Currency Translation and Foreign Currency Transactions | Foreign Currency Translation and Foreign Currency Transactions Adjustments resulting from translating foreign functional currency financial statements into U.S. Dollars are included in the foreign currency translation adjustment, a component of accumulated other comprehensive loss in the condensed consolidated statements of stockholders’ deficit. The Company has assets and liabilities, including receivables and payables, which are denominated in currencies other than their functional currency. These balance sheet items are subject to re-measurement, the impact of which is recorded in foreign currency exchange gain and loss, within the condensed consolidated statement of operations and comprehensive loss.
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Loss Per Share | Loss Per Share Basic loss per share includes no dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period. Potentially dilutive common shares consist of shares issuable from stock options, unvested RSUs and the Warrant (see Note 10). Other potentially dilutive common shares would also include common shares that would be outstanding if the 5.00% Notes were converted. Diluted earnings are not presented when the effect of adding such additional common shares is antidilutive.
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Comprehensive Loss | Comprehensive Loss In addition to net loss, comprehensive loss includes all changes in equity during a period, except those resulting from investments by and distributions to owners. The Company holds debt securities as available-for-sale and records the change in fair market value as a component of comprehensive loss. The Company also has adjustments resulting from translating foreign functional currency financial statements into U.S. Dollars which is included as a component of comprehensive loss.
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Standards that were recently adopted | Standards that were recently adopted In March 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2022-01, Derivatives and Hedging (Topic 815): Fair Value Hedging - Portfolio Layer Method. ASU 2022-01 is related to the portfolio layer method of hedge accounting. The amendments in this update clarify the accounting and promote consistency in reporting for hedges where the portfolio layer method is applied. This ASU was adopted January 1, 2023, and did not impact the Company’s consolidated financial statements at January 1, 2023. In March 2022, the FASB issued ASU 2022-02, Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. ASU 2022-02 relates to troubled debt restructurings (“TDRs”) and vintage disclosures for financing receivables. The amendments in this update eliminate the accounting guidance for TDRs by creditors while enhancing disclosure requirements for certain loan refinancing and restructurings by creditors made to borrowers experiencing financial difficulty. The amendments also require disclosure of current-period gross write-offs by year of origination for financing receivables. This ASU was adopted January 1, 2023, and did not impact the Company's consolidated financial statements at January 1, 2023.
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ORGANIZATION AND NATURE OF BUSINESS; BASIS OF PRESENTATION; PRINCIPLES OF CONSOLIDATION; SIGNIFICANT ACCOUNTING POLICIES (Tables) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Allowance For Credit Losses | The allowance for credit losses for the three and six months ended June 30, 2023 and 2022 is comprised of the following (in thousands):
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Schedule of Warranty Reserve | Warranty reserve activity for the three and six months ended June 30, 2023 and 2022 is as follows (in thousands):
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FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value Measurement | The following tables represent the financial instruments measured at fair value on a recurring basis in the financial statements of the Company and the valuation approach applied to each class of financial instruments at June 30, 2023 and December 31, 2022 (in thousands):
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INVESTMENTS (Tables) |
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Investments, Debt and Equity Securities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Available-for-Sale Investments | The following tables summarize the Company’s debt securities classified as available-for-sale investments at June 30, 2023 and December 31, 2022 (in thousands):
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Schedule of Maturities of Available-for-Sale Investments | The following table summarizes the maturities of the Company’s debt securities classified as available-for-sale investments at June 30, 2023 and December 31, 2022 (in thousands):
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Schedule of Unrealized Losses or Gains on Equity Securities | Unrealized gains or losses on equity securities recorded in income during the three and six months ended June 30, 2023 and 2022 were as follows (in thousands):
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INVENTORY (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Components of Inventories | Inventories consisted of the following at June 30, 2023 and December 31, 2022 (in thousands):
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PROPERTY AND EQUIPMENT (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Property and Equipment | Property and equipment consisted of the following at June 30, 2023 and December 31, 2022 (in thousands):
Depreciation expense for the three and six months ended June 30, 2023 and 2022 were as follows (in thousands):
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Schedule of Instruments at Cost and Accumulated Depreciation, Lessor | Instruments at cost and accumulated depreciation where the Company is the lessor under operating leases consisted of the following at June 30, 2023 and December 31, 2022 (in thousands):
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DEFERRED REVENUE AND REMAINING PERFORMANCE OBLIGATIONS (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||
Schedule of Deferred Revenue and Income Summary | A summary of the balances as of June 30, 2023 and December 31, 2022 follows (in thousands):
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CONVERTIBLE NOTES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Convertible Notes | The carrying value of the convertible notes at June 30, 2023 and December 31, 2022 consisted of the following (in thousands):
At June 30, 2023 and December 31, 2022 the convertible notes were classified as follows (in thousands):
The carrying value of the 2.50% Notes at June 30, 2023 and December 31, 2022 consisted of the following (in thousands):
At June 30, 2023 and December 31, 2022 the 2.50% Notes were classified as follows (in thousands):
The carrying value of the 5.00% Notes at June 30, 2023 and December 31, 2022 consisted of the following (in thousands):
At June 30, 2023 and December 31, 2022 the 5.00% Notes were classified as follows (in thousands):
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Schedule of Interest Expense | Interest expense during the three and six months ended June 30, 2023 and 2022 was as follows (in thousands):
Interest expense for the 2.50% Notes during the three and six months ended June 30, 2023 and 2022 were as follows (in thousands):
Interest expense for the 5.00% Notes during the three and six months ended June 30, 2023 and 2022 were as follows (in thousands):
Interest expense in connection with the Secured Note during the three and six months ended June 30, 2023 and 2022 was as follows (in thousands):
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Schedule of Gain on Extinguishment | (Loss) gain on extinguishment of exchanged convertible notes during the three and six months ended June 30, 2023 and 2022 was as follows (in thousands):
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Schedule of Derivative Instruments | The derivative financial instrument activity for the three and six months ended June 30, 2023 and 2022 is comprised of the following (in thousands):
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Schedule of Future Principal Payments | Future principal payments on the 5.00% Notes as of June 30, 2023 are as follows (in thousands):
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Summary of Significant Inputs Used to Estimate Fair Value | The table below summarizes the significant inputs used to estimate the fair value of the 5.00% Notes as of June 30, 2023:
The table below summarizes the significant inputs used to estimate the fair value of the Conversion Option as of June 30, 2023 and June 9, 2023:
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LONG-TERM DEBT RELATED-PARTY (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Carrying Value | The carrying value of the Secured Note at June 30, 2023 and December 31, 2022 consisted of the following (in thousands):
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Schedule of Interest Expense | Interest expense during the three and six months ended June 30, 2023 and 2022 was as follows (in thousands):
Interest expense for the 2.50% Notes during the three and six months ended June 30, 2023 and 2022 were as follows (in thousands):
Interest expense for the 5.00% Notes during the three and six months ended June 30, 2023 and 2022 were as follows (in thousands):
Interest expense in connection with the Secured Note during the three and six months ended June 30, 2023 and 2022 was as follows (in thousands):
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LOSS PER SHARE (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Potentially Issuable Common Shares not Included in Computation of Diluted Net Loss Per Share | The following potentially issuable common shares were not included in the computation of diluted net loss per share because they would have an anti-dilutive effect for each of the three and six months ended June 30, 2023 and 2022 (in thousands):
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EMPLOYEE EQUITY-BASED COMPENSATION (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Option Activity under the Company's Equity-Based Compensation | The following table summarizes option activity under the Company's equity-based compensation plans for the six months ended June 30, 2023:
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Schedule of Outstanding Options and Options that are Exercisable (Vested) | The following table shows summary information for outstanding options and options that are exercisable (vested) as of June 30, 2023:
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Schedule of Restricted Stock Activity | The following table summarizes RSU and restricted stock award activity for the six months ended June 30, 2023:
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Schedule of Equity-Based Compensation Expense | The table below summarizes equity-based compensation expense for the three and six months ended June 30, 2023 and 2022 (in thousands):
The table below summarizes share-based compensation cost capitalized to inventory for the three and six months ended June 30, 2023 and 2022 (in thousands):
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LEASES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Supplemental Lease Information | The following presents supplemental information related to our leases in which we are the lessee for the three and six months ended June 30, 2023 and 2022 (in thousands):
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Schedule of Lease Costs | The following presents supplemental information related to our leases in which we are the lessee for the three and six months ended June 30, 2023 and 2022 (in thousands):
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Schedule of Maturities of Operating Lease Liabilities | The following presents maturities of lease liabilities in which we are the lessee as of June 30, 2023 (in thousands):
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Schedule of Maturities of Sales-type Lease Receivables | The following presents maturities of lease receivables under sales-type leases as of June 30, 2023 (in thousands):
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GEOGRAPHIC AND REVENUE DISAGGREGATION (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Disaggregation of Revenue | The following presents total net sales by geographic territory for the three and six months ended June 30, 2023 and 2022 (in thousands):
The following presents total net sales by line of business for the three and six months ended June 30, 2023 and 2022 (in thousands):
The following presents total net sales by products and services for the three and six months ended June 30, 2023 and 2022 (in thousands):
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Schedule of Long-lived Assets by Geographic Territory | The following presents property and equipment, net by geographic territory (in thousands):
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STOCKHOLDERS' EQUITY (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Inputs Used to Estimate the Fair Value of the Schuler Purchase Obligation | The table below summarizes equity-based compensation expense for the three and six months ended June 30, 2023 and 2022 (in thousands):
The table below summarizes share-based compensation cost capitalized to inventory for the three and six months ended June 30, 2023 and 2022 (in thousands):
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Summary of Significant Inputs Used to Estimate Fair Value | The table below summarizes the significant inputs used to estimate the fair value of the 5.00% Notes as of June 30, 2023:
The table below summarizes the significant inputs used to estimate the fair value of the Conversion Option as of June 30, 2023 and June 9, 2023:
|
ORGANIZATION AND NATURE OF BUSINESS; BASIS OF PRESENTATION; PRINCIPLES OF CONSOLIDATION; SIGNIFICANT ACCOUNTING POLICIES - Allowance For Doubtful Accounts (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Beginning balance | $ 314 | $ 159 | $ 324 | $ 140 |
Provisions, net | 0 | 7 | 0 | 30 |
Write-offs | 0 | (16) | (10) | (20) |
Ending balance | $ 314 | $ 150 | $ 314 | $ 150 |
ORGANIZATION AND NATURE OF BUSINESS; BASIS OF PRESENTATION; PRINCIPLES OF CONSOLIDATION; SIGNIFICANT ACCOUNTING POLICIES - Schedule of Product Warranty Reserve Activity (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Movement in Standard Product Warranty Accrual [Roll Forward] | ||||
Beginning balance | $ 221 | $ 176 | $ 225 | $ 139 |
Provisions (reversals), net | 153 | 93 | 187 | 139 |
Warranty cost incurred | (192) | (14) | (230) | (23) |
Ending balance | $ 182 | $ 255 | $ 182 | $ 255 |
CONCENTRATION OF CREDIT RISK (Details) |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Cash and Cash Equivalents | Concentration of Credit Risk | Financial Institutions One | |||||
Concentration Risk [Line Items] | |||||
Risk concentration | 79.00% | 52.00% | |||
Cash and Cash Equivalents | Concentration of Credit Risk | Financial Institutions Two | |||||
Concentration Risk [Line Items] | |||||
Risk concentration | 12.00% | 24.00% | |||
Cash and Cash Equivalents | Concentration of Credit Risk | Financial Institutions Three | |||||
Concentration Risk [Line Items] | |||||
Risk concentration | 21.00% | ||||
Net Accounts Receivable | Customer Concentration | One Customer | |||||
Concentration Risk [Line Items] | |||||
Risk concentration | 16.00% | 15.00% | |||
Total Revenue | Customer Concentration | One Customer | |||||
Concentration Risk [Line Items] | |||||
Risk concentration | 10.00% | 0.00% | 10.00% | 0.00% |
INVESTMENTS - Schedule of Available-for-sale Securities (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Debt and Equity Securities, FV-NI [Line Items] | ||
Amortized Cost | $ 406 | $ 9,757 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | (29) |
Fair Value | 406 | 9,728 |
Certificates of deposit | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Amortized Cost | 2,548 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (7) | |
Fair Value | 2,541 | |
U.S. Treasury securities | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Amortized Cost | 3,015 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (6) | |
Fair Value | 3,009 | |
Commercial paper | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Amortized Cost | 425 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (1) | |
Fair Value | 424 | |
Corporate notes and bonds | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Amortized Cost | 406 | 3,769 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | (15) |
Fair Value | $ 406 | $ 3,754 |
INVESTMENTS - Schedule of Available-for-Sale Investment Maturities (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Amortized Cost | ||
Due in less than 1 year | $ 406 | $ 9,757 |
Amortized Cost | 406 | 9,757 |
Fair Value | ||
Due in less than 1 year | 406 | 9,728 |
Fair Value | $ 406 | $ 9,728 |
INVESTMENTS - Narrative (Details) - USD ($) |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 09, 2023 |
Dec. 31, 2022 |
|
Debt Securities, Available-for-sale [Line Items] | ||||||
Proceeds from sales of debt securities | $ 0 | $ 0 | $ 0 | $ 0 | ||
Realized gain (loss) from debt securities | 0 | 0 | 0 | 0 | ||
Unrealized loss position of debt securities | 0 | 0 | 0 | 0 | ||
Fair value of equity securities | 1,000,000 | 1,000,000 | $ 900,000 | |||
Realized gains or losses from equity securities | $ 0 | 0 | $ 0 | 0 | ||
5.00% Convertible Notes Due 2026 | Convertible Notes | ||||||
Debt Securities, Available-for-sale [Line Items] | ||||||
Interest rate | 5.00% | 5.00% | 5.00% | |||
Reclassified Debt Securities Available-for-sale Balances | ||||||
Debt Securities, Available-for-sale [Line Items] | ||||||
Reclassified from out of accumulated other comprehensive income (loss) | $ 0 | $ 0 | $ 0 | $ 0 |
INVESTMENTS - Unrealized Losses or Gains on Equity Securities (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Investments, Debt and Equity Securities [Abstract] | ||||
Unrealized (gain) loss on equity investments | $ (40) | $ 107 | $ (90) | $ 157 |
INVENTORY (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Inventory Disclosure [Abstract] | ||
Raw materials | $ 1,668 | $ 1,827 |
Work in process | 1,689 | 2,115 |
Finished goods | 1,749 | 1,252 |
Inventory | $ 5,106 | $ 5,194 |
PROPERTY AND EQUIPMENT - Property and Equipment at Cost (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | $ 14,014 | $ 14,014 | $ 14,299 | ||
Accumulated depreciation | (11,118) | (11,118) | (10,821) | ||
Property and equipment, net | 2,896 | 2,896 | 3,478 | ||
Depreciation expense | 354 | $ 443 | 709 | $ 903 | |
Computer equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | 3,611 | 3,611 | 3,551 | ||
Technical equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | 3,246 | 3,246 | 3,236 | ||
Facilities | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | 3,688 | 3,688 | 3,663 | ||
Instruments | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | 3,402 | 3,402 | 3,735 | ||
Capital projects in progress | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | $ 67 | $ 67 | $ 114 |
PROPERTY AND EQUIPMENT - Instruments at Cost and Accumulated Depreciation, Lessor (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Property, Plant and Equipment [Abstract] | ||
Instruments at cost under operating leases | $ 2,382 | $ 2,585 |
Accumulated depreciation under operating leases | (1,325) | (1,209) |
Net property and equipment under operating leases | $ 1,057 | $ 1,376 |
DEFERRED REVENUE AND REMAINING PERFORMANCE OBLIGATIONS (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Disaggregation of Revenue [Line Items] | ||||||
Products and services not yet delivered | $ 478 | $ 478 | $ 478 | $ 547 | ||
Revenues recognized included in contract liabilities balances | 200 | $ 200 | 400 | $ 300 | ||
Revenue expected to be recognized from remaining performance obligations | 6,100 | 6,100 | $ 6,100 | |||
Contact period | These agreements have between two and four year terms and revenue is recognized as product is shipped, typically on a straight-line basis. The remaining balance relates to executed service contracts that begin as warranty periods expire. These service contracts typically provide for four-year terms and revenue is recognized on a straight-line basis. | |||||
Products and services not yet delivered | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Products and services not yet delivered | 478 | 478 | $ 478 | $ 547 | ||
Commercial Agent Relationship with BD | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Revenues recognized included in contract liabilities balances | 700 | |||||
Exclusivity fees | 100 | $ 100 | 100 | |||
Agent fee expense | $ 500 | |||||
Contract with Customer, Liability, Increase (Decrease) for Contract | $ 800 |
CONVERTIBLE NOTES - Schedule of Interest Expense (Details) - Convertible Notes - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Debt Instrument [Line Items] | ||||
Contractual coupon interest | $ 656 | $ 666 | $ 892 | $ 1,449 |
Amortization of debt discount and issuance costs | 510 | 154 | 692 | 265 |
Total interest expense on convertible notes | 1,166 | 820 | 1,584 | 1,714 |
2.50% Convertible Notes Due 2023 | ||||
Debt Instrument [Line Items] | ||||
Contractual coupon interest | 321 | 666 | 557 | 1,449 |
Amortization of debt discount and issuance costs | 0 | 154 | 182 | 265 |
Total interest expense on convertible notes | 321 | 820 | 739 | 1,714 |
5.00% Convertible Notes Due 2026 | ||||
Debt Instrument [Line Items] | ||||
Contractual coupon interest | 334 | 0 | 334 | 0 |
Amortization of debt discount and issuance costs | 510 | 0 | 510 | 0 |
Total interest expense on convertible notes | $ 844 | $ 0 | $ 844 | $ 0 |
CONVERTIBLE NOTES - Gain on Extinguishment (Details) - Exchange Agreement - Convertible Notes - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Debt Instrument [Line Items] | ||||
(Loss) gain on extinguishment | $ (6,550) | $ 199 | $ (6,550) | $ 3,565 |
2.50% Convertible Notes Due 2023 | ||||
Debt Instrument [Line Items] | ||||
(Loss) gain on extinguishment | $ 3,600 |
CONVERTIBLE NOTES - Schedule of Derivative Financial Instrument Activity (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 09, 2023 |
Mar. 31, 2023 |
Dec. 31, 2022 |
Mar. 31, 2022 |
Dec. 31, 2021 |
|
Derivative Instruments, Gain (Loss) [Roll Forward] | |||||||||
Derivative liability, June 9, 2023 | $ 38,160 | $ 0 | |||||||
Equity Option | |||||||||
Derivative Instruments, Gain (Loss) [Roll Forward] | |||||||||
Beginning balance | $ 42,786 | $ 0 | 42,786 | 0 | $ 38,200 | $ 0 | $ 0 | $ 0 | $ 0 |
Derivative liability, June 9, 2023 | 38,160 | 0 | 38,160 | 0 | |||||
Change in value - loss | 4,626 | 0 | 4,626 | 0 | |||||
Ending balance | $ 42,786 | $ 0 | $ 42,786 | $ 0 |
CONVERTIBLE NOTES - Schedule of Future Principal Payments (Details) - Convertible Notes - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Debt Instrument [Line Items] | ||
Net carrying amount | $ 33,015 | $ 56,413 |
5.00% Convertible Notes Due 2026 | ||
Debt Instrument [Line Items] | ||
2023 | 0 | |
2024 | 0 | |
2025 | 0 | |
2026 | 79,612 | |
2027 | 0 | |
Total including PIK interest, before unamortized discount and issuance costs | 79,612 | |
Less: unaccrued paid-in-kind interest | (12,719) | |
Less: unamortized discount and deferred issuance costs | (34,604) | |
Net carrying amount | $ 32,289 | $ 0 |
LONG-TERM DEBT RELATED-PARTY - Carrying Value of the Secured Notes (Details) - 5.0% Secured Promissory Note - Senior Notes - August 2022 Exchange Transaction - Affiliated Entity - Schuler Trust - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Debt Instrument [Line Items] | ||
Outstanding principal | $ 0 | $ 34,934 |
Unamortized debt issuance discount | 0 | (18,076) |
Net carrying amount | $ 0 | $ 16,858 |
LONG-TERM DEBT RELATED-PARTY - Schedule of Interest Expense (Details) - Affiliated Entity - August 2022 Exchange Transaction - 5.0% Secured Promissory Note - Senior Notes - Schuler Trust - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Debt Instrument [Line Items] | ||||
Contractual interest | $ 343 | $ 0 | $ 784 | $ 0 |
Amortization of the debt discount | 462 | 0 | 1,034 | 0 |
Total interest expense on convertible notes | $ 805 | $ 0 | $ 1,818 | $ 0 |
LOSS PER SHARE - Narrative (Details) - 5.00% Convertible Notes Due 2026 - Convertible Notes |
Jun. 30, 2023 |
Jun. 09, 2023
$ / shares
|
---|---|---|
Debt Instrument [Line Items] | ||
Interest rate | 5.00% | 5.00% |
Initial conversion price (in usd per share) | $ 7.20 | |
Shares issued (in shares) | 0.13889 | |
Conversion premium percent | 50.00% | |
Plan | ||
Debt Instrument [Line Items] | ||
Common stock issuable upon conversion (in shares) | 9,300,000 | |
Minimum | ||
Debt Instrument [Line Items] | ||
Initial conversion price (in usd per share) | $ 8.30 | |
Shares issued (in shares) | 0.12048 | |
Minimum | Option one | ||
Debt Instrument [Line Items] | ||
Shares issued (in shares) | 0.12048193 |
EMPLOYEE EQUITY-BASED COMPENSATION - Option Activity under the Company's Equity-Based Compensation (Details) |
6 Months Ended |
---|---|
Jun. 30, 2023
$ / shares
shares
| |
Number of Shares | |
Outstanding, beginning balance (in shares) | shares | 540,732 |
Granted (in shares) | shares | 10,000 |
Forfeited (in shares) | shares | (10,257) |
Exercised (in shares) | shares | 0 |
Expired (in shares) | shares | (135,377) |
Outstanding, ending balance (in shares) | shares | 405,098 |
Weighted Average Exercise Price per Share | |
Outstanding, beginning balance (in usd per share) | $ / shares | $ 146.03 |
Granted (in usd per share) | $ / shares | 5.10 |
Forfeited (in usd per share) | $ / shares | 82.45 |
Exercised (in usd per share) | $ / shares | 0 |
Expired (in usd per share) | $ / shares | 128.71 |
Outstanding, ending balance (in usd per share) | $ / shares | $ 148.78 |
EMPLOYEE EQUITY-BASED COMPENSATION - Outstanding Options and Options that are Exercisable (Vested) (Details) - USD ($) $ / shares in Units, $ in Thousands |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Options Outstanding | ||
Number of options (in shares) | 405,098 | 540,732 |
Weighted average remaining contractual term (in years) | 5 years 4 months 28 days | |
Weighted average exercise price (in usd per share) | $ 148.78 | $ 146.03 |
Weighted average fair value (in usd per shares) | $ 90.46 | |
Aggregate intrinsic value (in thousands) | $ 22 | |
Options Exercisable | ||
Number of options (in shares) | 331,878 | |
Weighted average remaining contractual term (in years) | 4 years 11 months 19 days | |
Weighted average exercise price (in usd per share) | $ 160.57 | |
Weighted average fair value (in usd per share) | $ 96.56 | |
Aggregate intrinsic value (in thousands) | $ 0 |
EMPLOYEE EQUITY-BASED COMPENSATION - Restricted Stock Activity (Details) - RSUs and RSAs |
6 Months Ended |
---|---|
Jun. 30, 2023
$ / shares
shares
| |
Number of Shares | |
Beginning balance (in shares) | shares | 435,488 |
Granted (in shares) | shares | 1,123,922 |
Forfeited (in shares) | shares | (71,301) |
Released (in shares) | shares | (294,779) |
Ending balance (in shares) | shares | 1,193,330 |
Weighted Average Grant Date Fair Value per Share | |
Beginning balance (in usd per share) | $ / shares | $ 42.91 |
Granted (in usd per share) | $ / shares | 7.14 |
Forfeited (in usd per share) | $ / shares | 42.65 |
Released (in usd per share) | $ / shares | 25.38 |
Ending balance (in usd per share) | $ / shares | $ 13.57 |
EMPLOYEE EQUITY-BASED COMPENSATION - Equity-Based Compensation Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Equity-based compensation expense | $ 1,653 | $ 3,971 | $ 2,208 | $ 6,950 |
Cost capitalized to inventory | 35 | 74 | 109 | 117 |
Cost of sales | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Equity-based compensation expense | 98 | 228 | 188 | 403 |
Research and development | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Equity-based compensation expense | 256 | 539 | 861 | 901 |
Sales, general and administrative | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Equity-based compensation expense | $ 1,299 | $ 3,204 | $ 1,159 | $ 5,646 |
INCOME TAXES (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Income Tax Disclosure [Abstract] | ||||
Provision for income taxes | $ (156) | $ 0 | $ (156) | $ 0 |
Pre-tax loss | $ 32,579 | $ 18,523 | $ 49,374 | $ 31,988 |
COMMITMENTS (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Apr. 30, 2022 |
---|---|---|
Commitments and Contingencies Disclosure [Abstract] | ||
Total commitments | $ 11.9 | $ 11.9 |
LEASES - Assets and Liabilities (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Cash paid for amounts included in lease liabilities: | ||||
Operating cash flows from operating leases | $ 226 | $ 203 | $ 453 | $ 266 |
Financing cash flows from finance leases | 462 | 424 | 540 | 424 |
ROU assets obtained in exchange for lease obligations: | ||||
Operating leases | 0 | 0 | 0 | 0 |
Finance leases | 200 | 2,760 | 200 | 2,760 |
Lease Cost: | ||||
Operating leases | 243 | 259 | 493 | 564 |
Finance leases | 270 | 97 | 531 | 97 |
Short-term leases | $ 19 | $ 21 | $ 43 | $ 41 |
Weighted average remaining lease term (years) | 2 years 1 month 6 days | 2 years 1 month 6 days | ||
Weighted average discount rate (%) | 7.10% | 7.10% | ||
Weighted average remaining lease term finance leases (years) | 1 year 9 months 18 days | 1 year 9 months 18 days | ||
Weighted average discount rate finance leases (%) | 6.00% | 6.00% |
LEASES - Maturities of Lease Liabilities (Details) $ in Thousands |
Jun. 30, 2023
USD ($)
|
---|---|
Operating | |
Remainder of 2023 | $ 515 |
2024 | 1,051 |
2025 | 583 |
2026 | 0 |
2027 | 0 |
Thereafter | 0 |
Total lease payments | 2,149 |
Less imputed interest | (149) |
Lessee lease liabilities | 2,000 |
Finance | |
Remainder of 2023 | 497 |
2024 | 1,048 |
2025 | 265 |
2026 | 36 |
2027 | 0 |
Thereafter | 0 |
Total lease payments | 1,846 |
Less imputed interest | (291) |
Finance lease obligation | $ 1,555 |
LEASES - Sales-type Lease Receivable Maturity (Details) $ in Thousands |
Jun. 30, 2023
USD ($)
|
---|---|
Leases [Abstract] | |
Net investment in leases | $ 2,400 |
Remainder of 2023 | 745,000 |
2024 | 995,000 |
2025 | 395,000 |
2026 | 209,000 |
2027 | 46,000 |
Thereafter | 0 |
Total undiscounted cash flows | 2,390,000 |
Less imputed interest | 0 |
Present value of lease payments | $ 2,390,000 |
GEOGRAPHIC AND REVENUE DISAGGREGATION - Narrative (Details) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2023
USD ($)
|
Jun. 30, 2022
USD ($)
|
Jun. 30, 2023
USD ($)
segment
|
Jun. 30, 2022
USD ($)
|
Dec. 31, 2022
USD ($)
|
|
Segment Reporting [Abstract] | |||||
Number of operating segments | segment | 1 | ||||
Segment Reporting Information [Line Items] | |||||
Trade accounts receivable, net | $ 2,342 | $ 2,342 | $ 2,416 | ||
Lease income | $ 400 | $ 600 | $ 600 | $ 1,100 | |
Geographic Concentration | Outside the U.S. | Total Revenue | |||||
Segment Reporting Information [Line Items] | |||||
Risk concentration | 10.00% | 14.00% | 12.00% | 14.00% | |
Geographic Concentration | Outside the U.S. | Net Accounts Receivable | |||||
Segment Reporting Information [Line Items] | |||||
Trade accounts receivable, net | $ 600 | $ 600 | $ 600 |
GEOGRAPHIC AND REVENUE DISAGGREGATION - Disaggregation of Revenue (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 2,921 | $ 3,861 | $ 5,733 | $ 6,820 |
Accelerate Pheno revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2,853 | 3,818 | 5,665 | 6,736 |
Other revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 68 | 43 | 68 | 84 |
Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2,565 | 3,476 | 5,009 | 6,023 |
Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 356 | 385 | 724 | 797 |
Domestic | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2,619 | 3,321 | 5,035 | 5,839 |
Foreign | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 302 | $ 540 | $ 698 | $ 981 |
GEOGRAPHIC AND REVENUE DISAGGREGATION - Long-lived Assets by Geographic Territory (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Segment Reporting Information [Line Items] | ||
Long-lived assets (excluding intangible assets) | $ 2,896 | $ 3,478 |
Property and Equipment | Geographic Concentration | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets (excluding intangible assets) | 2,896 | 3,478 |
Property and Equipment | Geographic Concentration | Domestic | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets (excluding intangible assets) | 2,577 | 3,120 |
Property and Equipment | Geographic Concentration | Foreign | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets (excluding intangible assets) | $ 319 | $ 358 |
SUBSEQUENT EVENTS (Details) $ in Millions |
Jul. 11, 2023 |
Jul. 07, 2023
USD ($)
|
Jun. 09, 2023 |
Jun. 30, 2023 |
---|---|---|---|---|
5.00% Convertible Notes Due 2026 | Convertible Notes | ||||
Subsequent Event [Line Items] | ||||
Interest rate | 5.00% | 5.00% | ||
Shares issued (in shares) | 0.13889 | |||
Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Reverse stock split ratio | 0.1 | |||
Subsequent Event | 5.00% Convertible Notes Due 2026 | Convertible Notes | ||||
Subsequent Event [Line Items] | ||||
Interest rate | 5.00% | |||
Convertible notes value | $ 0.7 |
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