Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2022 | Jul. 29, 2022 | |
Entity Addresses [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-40354 | |
Entity Registrant Name | Zymergen Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 46-2942439 | |
Entity Address, Address Line One | 5959 Horton Street | |
Entity Address, Address Line Two | Suite 700 | |
Entity Address, City or Town | Emeryville | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94608 | |
City Area Code | 415 | |
Local Phone Number | 801-8073 | |
Title of 12(b) Security | Common stock, $0.001 par value per share | |
Trading Symbol | ZY | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 104,098,538 | |
Entity Central Index Key | 0001645842 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Former Address | ||
Entity Addresses [Line Items] | ||
Entity Address, Address Line One | 5980 Horton Street | |
Entity Address, Address Line Two | Suite 105 | |
Entity Address, City or Town | Emeryville | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94608 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | |
Current assets: | |||
Cash and cash equivalents | $ 213,558 | $ 386,105 | [1] |
Accounts receivable | 1,272 | 520 | [1] |
Accounts receivable, unbilled | 2,424 | 2,565 | [1] |
Prepaid expenses | 11,814 | 7,818 | [1] |
Inventories | 6,107 | 6,035 | [1] |
Restricted cash, current | 2,997 | 2,105 | [1] |
Other current assets | 1,469 | 2,201 | [1] |
Total current assets | 239,641 | 407,349 | [1] |
Restricted cash | 10,016 | 9,849 | [1] |
Property and equipment, net | 70,590 | 53,799 | [1] |
Operating lease right-of-use assets | 141,105 | ||
Goodwill | 0 | 40,645 | [1] |
Intangible assets, net | 7,380 | 8,529 | [1] |
Other long-term assets | 2,236 | 2,225 | [1] |
Total assets | 470,968 | 522,396 | [1] |
Current liabilities: | |||
Accounts payable | 12,877 | 5,418 | [1] |
Accrued and other liabilities | 27,009 | 17,496 | [1] |
Short-term operating lease liabilities | 7,900 | ||
Short-term debt, net | 0 | 43,953 | [1] |
Short-term deferred rent | 0 | 2,218 | [1] |
Deferred revenue | 4,410 | 4,468 | [1] |
Total current liabilities | 52,196 | 73,553 | [1] |
Long-term operating lease liabilities | 178,181 | ||
Long-term deferred rent | 0 | 35,390 | [1] |
Other long-term liabilities | 3,968 | 4,967 | [1] |
Total liabilities | 234,345 | 113,910 | [1] |
Commitments and contingencies | [1] | ||
Stockholders' equity | |||
Preferred stock, $0.001 par value, 170,000,000 authorized as of June 30, 2022 and December 31, 2021, respectively; no shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively | 0 | 0 | [1] |
Common stock, $0.001 par value, 1,500,000,000 shares authorized as of June 30, 2022 and December 31, 2021, respectively; 103,828,096 and 103,045,299 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively | 104 | 103 | [1] |
Additional paid-in capital | 1,560,628 | 1,543,908 | [1] |
Accumulated deficit | (1,324,109) | (1,135,525) | [1] |
Total stockholders' equity | 236,623 | 408,486 | [1] |
Total liabilities and stockholders' equity | $ 470,968 | $ 522,396 | [1] |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
[1]The balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Jun. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized (in shares) | 170,000,000 | 170,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding ( in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 1,500,000,000 | 1,500,000,000 |
Common stock, issued (in shares) | 103,828,096 | 103,045,299 |
Common stock, outstanding (in shares) | 103,828,096 | 103,045,299 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenues | $ 2,634 | $ 5,854 | $ 7,425 | $ 9,589 |
Cost and operating expenses: | ||||
Research and development | 31,186 | 50,152 | 59,925 | 89,963 |
Sales and marketing | 3,158 | 7,904 | 6,796 | 14,776 |
General and administrative | 24,294 | 23,661 | 47,999 | 42,992 |
Goodwill impairment charge | 40,645 | 0 | 40,645 | 0 |
Restructuring charges (benefit) | (185) | 0 | (315) | 0 |
Total cost and operating expenses | 108,830 | 103,546 | 177,237 | 190,690 |
Operating loss | (106,196) | (97,692) | (169,812) | (181,101) |
Other income (expense): | ||||
Interest income | 2 | 12 | 53 | 55 |
Interest expense | (9,378) | (2,767) | (17,423) | (5,494) |
Gain (loss) on change in fair value of warrant liabilities | 0 | (430) | 0 | 1,849 |
Other expense, net | (885) | (5) | (1,417) | (768) |
Total other expense | (10,261) | (3,190) | (18,787) | (4,358) |
Loss before income taxes | (116,457) | (100,882) | (188,599) | (185,459) |
Benefit from (provision for) income taxes | (11) | 16 | 15 | 8 |
Net loss and comprehensive loss | (116,468) | (100,866) | (188,584) | (185,451) |
Net loss and comprehensive loss | $ (116,468) | $ (100,866) | $ (188,584) | $ (185,451) |
Net loss per share attributable to common stockholders, basic (in dollars per share) | $ (1.13) | $ (1.30) | $ (1.83) | $ (4.07) |
Net loss per share attributable to common stockholders, diluted (in dollars per share) | $ (1.13) | $ (1.30) | $ (1.83) | $ (4.10) |
Weighted average shares used in computing net loss per share to common stockholders, basic (in shares) | 103,482,907 | 77,671,643 | 103,297,070 | 45,512,654 |
Weighted average shares used in computing net loss per share to common stockholders, diluted (in shares) | 103,482,907 | 77,671,643 | 103,297,070 | 45,727,153 |
Revenues from research and development service agreements | ||||
Revenues | $ 1,191 | $ 4,846 | $ 4,412 | $ 7,460 |
Collaboration and other revenue | ||||
Revenues | 746 | 1,008 | 2,079 | 2,129 |
Automation revenue | ||||
Revenues | 480 | 0 | 480 | 0 |
Cost and operating expenses: | ||||
Cost of revenue | 637 | 0 | 637 | 0 |
Grant revenue | ||||
Revenues | 217 | 0 | 454 | 0 |
Service revenue | ||||
Cost and operating expenses: | ||||
Cost of revenue | $ 9,095 | $ 21,829 | $ 21,550 | $ 42,959 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | |
Shares outstanding, beginning balance (in shares) at Dec. 31, 2020 | 12,812,109 | ||||
Stockholders equity, beginning balance at Dec. 31, 2020 | $ (743,736) | $ 13 | $ 29,991 | $ (773,740) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Vesting of restricted common stock (in shares) | 16,810 | ||||
Issuance of common stock upon exercise of options (in shares) | 711,963 | ||||
Issuance of common stock upon exercise of options | 3,189 | 3,189 | |||
Stock-based compensation expense | 2,253 | 2,253 | |||
Share settlement of non-recourse loan to employees (in shares) | (67,050) | ||||
Cash settlement of non-recourse loan to employee | 1,946 | 1,946 | |||
Net loss | (84,585) | (84,585) | |||
Shares outstanding, ending balance (in shares) at Mar. 31, 2021 | 13,473,832 | ||||
Stockholders equity, ending balance at Mar. 31, 2021 | $ (820,933) | $ 13 | 37,379 | (858,325) | |
Shares outstanding, beginning balance (in shares) at Dec. 31, 2020 | 68,093,280 | ||||
Temporary equity, beginning balance at Dec. 31, 2020 | $ 900,798 | ||||
Shares outstanding, ending balance (in shares) at Mar. 31, 2021 | 68,093,280 | ||||
Temporary equity, ending balance at Mar. 31, 2021 | $ 900,798 | ||||
Shares outstanding, beginning balance (in shares) at Dec. 31, 2020 | 12,812,109 | ||||
Stockholders equity, beginning balance at Dec. 31, 2020 | (743,736) | $ 13 | 29,991 | (773,740) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (185,451) | ||||
Shares outstanding, ending balance (in shares) at Jun. 30, 2021 | 102,297,175 | ||||
Stockholders equity, ending balance at Jun. 30, 2021 | $ 569,312 | $ 103 | 1,528,400 | (959,191) | |
Shares outstanding, beginning balance (in shares) at Dec. 31, 2020 | 68,093,280 | ||||
Temporary equity, beginning balance at Dec. 31, 2020 | $ 900,798 | ||||
Shares outstanding, ending balance (in shares) at Jun. 30, 2021 | 0 | ||||
Temporary equity, ending balance at Jun. 30, 2021 | $ 0 | ||||
Shares outstanding, beginning balance (in shares) at Mar. 31, 2021 | 13,473,832 | ||||
Stockholders equity, beginning balance at Mar. 31, 2021 | (820,933) | $ 13 | 37,379 | (858,325) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Vesting of restricted common stock (in shares) | 16,810 | ||||
Issuance of common stock upon initial public offering, net of commission and issuance costs of $45,138 (in shares) | 18,549,500 | ||||
Issuance of common stock upon initial public offering, net of commission and issuance costs of $45,138 | 529,897 | $ 19 | 529,878 | ||
Issuance of common stock upon exercise of options (in shares) | 256,960 | ||||
Issuance of common stock upon exercise of options | 1,258 | $ 1 | 1,257 | ||
Stock-based compensation expense | 6,965 | 6,965 | |||
Conversion of preferred stock into common stock (in shares) | 68,998,791 | ||||
Conversion of preferred stock into common stock | 928,182 | $ 69 | 928,113 | ||
Shares issued for exercise of warrants (in shares) | 226,880 | ||||
Issuance of common stock in business acquisition (in shares) | 774,402 | ||||
Issuance of common stock in business acquisition | 24,809 | $ 1 | 24,808 | ||
Net loss | (100,866) | (100,866) | |||
Shares outstanding, ending balance (in shares) at Jun. 30, 2021 | 102,297,175 | ||||
Stockholders equity, ending balance at Jun. 30, 2021 | $ 569,312 | $ 103 | 1,528,400 | (959,191) | |
Shares outstanding, beginning balance (in shares) at Mar. 31, 2021 | 68,093,280 | ||||
Temporary equity, beginning balance at Mar. 31, 2021 | $ 900,798 | ||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||
Issuance of preferred stock upon exercise of Series C Preferred Stock warrants (in shares) | 883,332 | ||||
Issuance of preferred stock upon exercise of Series C Preferred Stock warrants | $ 27,384 | ||||
Conversion of preferred stock into common stock (in shares) | (68,976,612) | ||||
Conversion of preferred stock into common stock | $ (928,182) | ||||
Shares outstanding, ending balance (in shares) at Jun. 30, 2021 | 0 | ||||
Temporary equity, ending balance at Jun. 30, 2021 | $ 0 | ||||
Shares outstanding, beginning balance (in shares) at Dec. 31, 2021 | 103,045,299 | 103,045,299 | |||
Stockholders equity, beginning balance at Dec. 31, 2021 | $ 408,486 | [1] | $ 103 | 1,543,908 | (1,135,525) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Vesting of restricted stock unit (in shares) | 916 | ||||
Issuance of common stock upon exercise of options (in shares) | 77,093 | ||||
Issuance of common stock upon exercise of options | 303 | 303 | |||
Stock-based compensation expense | 7,391 | 7,391 | |||
Net loss | (72,116) | (72,116) | |||
Shares outstanding, ending balance (in shares) at Mar. 31, 2022 | 103,123,308 | ||||
Stockholders equity, ending balance at Mar. 31, 2022 | $ 344,064 | $ 103 | 1,551,602 | (1,207,641) | |
Shares outstanding, beginning balance (in shares) at Dec. 31, 2021 | 0 | ||||
Temporary equity, beginning balance at Dec. 31, 2021 | $ 0 | ||||
Shares outstanding, ending balance (in shares) at Mar. 31, 2022 | 0 | ||||
Temporary equity, ending balance at Mar. 31, 2022 | $ 0 | ||||
Shares outstanding, beginning balance (in shares) at Dec. 31, 2021 | 103,045,299 | 103,045,299 | |||
Stockholders equity, beginning balance at Dec. 31, 2021 | $ 408,486 | [1] | $ 103 | 1,543,908 | (1,135,525) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | $ (188,584) | ||||
Shares outstanding, ending balance (in shares) at Jun. 30, 2022 | 103,828,096 | 103,828,096 | |||
Stockholders equity, ending balance at Jun. 30, 2022 | $ 236,623 | $ 104 | 1,560,628 | (1,324,109) | |
Shares outstanding, beginning balance (in shares) at Dec. 31, 2021 | 0 | ||||
Temporary equity, beginning balance at Dec. 31, 2021 | $ 0 | ||||
Shares outstanding, ending balance (in shares) at Jun. 30, 2022 | 0 | ||||
Temporary equity, ending balance at Jun. 30, 2022 | $ 0 | ||||
Shares outstanding, beginning balance (in shares) at Mar. 31, 2022 | 103,123,308 | ||||
Stockholders equity, beginning balance at Mar. 31, 2022 | 344,064 | $ 103 | 1,551,602 | (1,207,641) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Vesting of restricted stock unit (in shares) | 427,996 | ||||
Vesting of restricted stock units | 0 | $ 1 | (1) | ||
Stock-based compensation expense | 8,642 | 8,642 | |||
Issuance of common stock pursuant to ESPP purchases (in shares) | 276,792 | ||||
Issuance of common stock pursuant to ESPP purchases | 385 | 385 | |||
Net loss | $ (116,468) | (116,468) | |||
Shares outstanding, ending balance (in shares) at Jun. 30, 2022 | 103,828,096 | 103,828,096 | |||
Stockholders equity, ending balance at Jun. 30, 2022 | $ 236,623 | $ 104 | $ 1,560,628 | $ (1,324,109) | |
Shares outstanding, beginning balance (in shares) at Mar. 31, 2022 | 0 | ||||
Temporary equity, beginning balance at Mar. 31, 2022 | $ 0 | ||||
Shares outstanding, ending balance (in shares) at Jun. 30, 2022 | 0 | ||||
Temporary equity, ending balance at Jun. 30, 2022 | $ 0 | ||||
[1]The balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) (Unaudited) (Parenthetical) $ in Thousands | 3 Months Ended |
Jun. 30, 2021 USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Commission and issuance costs | $ 45,138 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Operating activities | ||
Net loss | $ (188,584) | $ (185,451) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization expense | 10,209 | 9,330 |
Stock-based compensation expense | 16,033 | 9,218 |
Non-cash lease expense | 5,930 | 0 |
Non-cash interest expense | 14,532 | 580 |
Goodwill impairment charge | 40,645 | 0 |
(Gain) loss on change in fair value of warrant liabilities | 0 | (1,849) |
Foreign exchange loss | 1,290 | 573 |
Other | (111) | (35) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (752) | (3,482) |
Accounts receivable, unbilled | 141 | 192 |
Prepaid expenses | (5,732) | (6,718) |
Inventories | (72) | (982) |
Other current assets | 732 | 430 |
Operating lease right-of-use assets | 2,677 | |
Other long-term assets | 38 | 3 |
Accounts payable | 1,076 | (2,821) |
Accrued and other liabilities | 2,825 | 1,879 |
Deferred revenue | (1,015) | (87) |
Operating lease liabilities | 605 | 0 |
Deferred rent | 0 | 11,943 |
Other long-term liabilities | (42) | 173 |
Net cash used in operating activities | (99,575) | (167,104) |
Investing activities | ||
Purchases of property and equipment | (13,068) | (19,563) |
Proceeds from sale of property and equipment | 209 | 0 |
Business acquisition, net of cash acquired | 0 | 1,238 |
Net cash used in investing activities | (12,859) | (18,325) |
Financing activities | ||
Proceeds from initial public offering, net of commission and issuance cost | 0 | 533,293 |
Proceeds from exercise of Series C warrants | 0 | 15,002 |
Proceeds from exercise of common stock options | 303 | 4,448 |
Proceeds from ESPP | 385 | 0 |
Payments on debt | (58,485) | 0 |
Proceeds from repayment of non-recourse loan to employee | 0 | 1,946 |
Other | (49) | 0 |
Net cash (used in) provided by financing activities | (57,846) | 554,689 |
Effect of exchange rate changes on cash | (1,208) | (532) |
Change in cash and cash equivalents | (171,488) | 368,728 |
Cash, cash equivalents, and restricted cash at beginning of the period | 398,059 | 219,810 |
Cash, cash equivalents, and restricted cash at end of the period | 226,571 | 588,538 |
Cash and cash equivalents | 213,558 | 577,731 |
Restricted cash, current | 2,997 | 30 |
Restricted cash, non-current | 10,016 | 10,777 |
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows | 226,571 | 588,538 |
Supplemental disclosure of cash flow information: | ||
Cash paid during the period for interest | 2,891 | 4,942 |
Supplemental disclosure of non-cash investing and financing activities: | ||
Conversion of preferred shares to common stock | 0 | 928,182 |
Exercise of warrant liability into preferred stock | 0 | 12,382 |
Issuance of common stock upon cashless exercise of warrants | 0 | 749 |
Issuance of common stock in business combination | 0 | 24,809 |
Acquisitions of property and equipment under accounts payable and accrued and other liabilities | 17,550 | 5,675 |
Operating lease right-of-use assets obtained in the exchange for new operating lease liabilities, net | (4,112) | 0 |
Offering costs related to initial public offering under accounts payable and accrued and other liabilities | 0 | 2,948 |
Share settlement of non-recourse loan to employee | $ 0 | $ 1,946 |
Nature of Operations
Nature of Operations | 6 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | Nature of Operations Zymergen Inc. (the “Company”) integrates computational and manufacturing technologies to design, develop, and commercialize bio-based breakthrough products in a broad range of industries. The Company has developed a platform based on its collection of accessible biomolecules, its software and data science technology, and its data driven microbe optimization processes. In addition, the Company's platform is used to discover novel molecules used to enable unique material properties. Utilizing its platform Zymergen is pursuing three markets focused on advanced materials, drug discovery and automation. The Company was incorporated in Delaware on April 24, 2013. Need for Additional Capital In accordance with Accounting Standards Update (“ASU”) No. 2014-15, Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205-40) (“ASU No. 2014-15”), 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 about the Company’s ability to continue as a going concern 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. Generally, to be considered probable of being effectively implemented, the plans must have been approved before the date that the financial statements are issued. The Company has sustained operating losses and expects to continue to generate operating losses for the foreseeable future. The Company had an accumulated deficit of $1.3 billion as of June 30, 2022. During the six months ended June 30, 2022, the Company incurred a net loss of $188.6 million and used $99.6 million of cash in operating activities. While the Company has signed a number of initial customer R&D services and collaboration contracts, revenues have been insufficient to fund operations. Accordingly, the Company has funded the portion of operating costs exceeding revenues through a combination of proceeds raised from equity and debt issuances. The Company had unrestricted cash and cash equivalents of $213.6 million as of June 30, 2022. As of August 15, 2022, the date of issuance of these Condensed Consolidated Financial Statements, the Company expects that its cash and cash equivalents as of June 30, 2022 will not be sufficient to fund its current business plan, including related operating expenses and capital expenditure requirements, through at least 12 months from the date of issuance of these Condensed Consolidated Financial Statements. These conditions raise substantial doubt as to the Company’s ability to continue as a going concern. To address these conditions, the Company has implemented measures to reduce its operating costs by executing a reduction in force (as discussed in Note 14), and plans to implement additional operating cost and capital expenditure reduction measures, including further reductions in force. As discussed in Note 14, on July 24, 2022, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Ginkgo Bioworks Holdings, Inc. (“Ginkgo”) and Pepper Merger Subsidiary, Inc. (“Merger Sub”), providing for the merger of Merger Sub with and into the Company (the “Merger”), with the Company surviving as a wholly owned subsidiary of Ginkgo. The Merger Agreement contains certain covenants that restrict the Company’s ability to enter into certain transactions during the pendency of the proposed Merger, including, among others, equity offerings, debt financings and the subleasing of the Company’s leased properties, without obtaining the consent of Ginkgo. The Company therefore may be unable to engage in such transactions during the pendency of the Merger unless it obtains the consent of Ginkgo. Consistent with regular practice for a growth-stage company, and as the Company has done in the past, the Company anticipates the need, and is exploring options for, additional financing in order to meet our cash requirements if the proposed merger with Ginkgo is not ultimately consummated. However, there can be no assurances that the Company will be able to obtain additional capital on acceptable terms and in the amounts necessary to fully fund current operating expenses or reduced operating expenses reflecting delays or reductions in the scope of our product development programs beyond one year from the date this annual report is issued. Additionally, funding will depend on a variety of factors, many of which are unpredictable and beyond the Company's control, including general conditions in the global economy and in the global financial markets, which have been, and may continue to be, impacted by interruptions, delays and/or cost increases resulting from the ongoing COVID-19 pandemic, political instability or geopolitical tensions, such as the current war in Ukraine (the “Ukraine War”), economic weakness or inflationary pressures. As such, we believe there is substantial doubt regarding our ability to continue as a going concern within one year after the date this Quarterly Report on Form 10-Q is filed with the SEC. The accompanying Condensed Consolidated Financial Statements have been prepared on a going concern basis, which assumes the Company will continue as a going concern and contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The Company’s operating costs include the cost of developing and commercializing products, as well as providing research and development services. The accompanying Condensed Consolidated Financial Statements do not reflect any adjustments relating to the recoverability and reclassifications of assets and liabilities that would be necessary if the Company is unable to continue as a going concern. Impact of COVID-19 The Company cannot at this time predict the specific extent, duration, or full impact that the ongoing COVID-19 pandemic will have on its financial condition and operations. The impact of the COVID-19 pandemic on the financial performance of the Company will depend on future developments, including the duration and spread of the pandemic and related governmental advisories and restrictions. These developments and the continuing impact of the COVID-19 pandemic on the financial markets and the overall economy are highly uncertain. If business conditions, financial markets and/or the overall economy continue to be impacted, the Company’s results may be adversely affected. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies There were no significant changes to the accounting policies during the six months ended June 30, 2022, from the significant accounting policies described in Note 2 of the “Notes to Consolidated Financial Statements” in the Company's 2021 Form 10-K, filed with the Securities and Exchange Commission (“SEC”) on March 30, 2022, except as described below. Basis of Preparation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the SEC regarding interim financial reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP have been condensed or omitted, and accordingly the balance sheet as of December 31, 2021 has been derived from audited financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements. These unaudited interim Condensed Consolidated Financial Statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair presentation of the financial information. The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any other interim period or for any other future year. The accompanying unaudited Condensed Consolidated Financial Statements and related financial information should be read in conjunction with the audited financial statements and the related notes thereto for the year ended December 31, 2021 included in the Company's 2021 Form 10-K. The Company has reclassified certain prior year amounts to conform with current period presentation. Principles of Consolidation These Condensed Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated upon consolidation. Fiscal Year The Company’s fiscal year ends on December 31. References to fiscal 2022, for example, refer to the fiscal year ended December 31, 2022. The period end for the Company covered by this report is June 30, 2022. Use of Estimates The presentation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. These estimates include, but are not limited to, standalone selling price of performance obligations for contracts with multiple performance obligations, estimate of variable consideration from revenue contracts, useful life of property and equipment, fair value of the reporting unit for purposes of the assessment of goodwill impairment and undiscounted cash flows and residual values of long-lived assets of which the carrying value may not be recoverable, allowance for doubtful accounts, net realizable value of inventories, the valuation of intangible assets, the valuation of common and preferred stock used in the valuation of options to purchase common stock and warrants to purchase common stock or preferred stock, prior to being a publicly traded company, and the incremental borrowing rate used in determining operating lease liabilities. Actual results could differ from those estimates. Segment Information Operating segments are identified as components of an enterprise about which discrete financial information is available for evaluation by the chief operating decision-maker (“CODM”) in deciding resource allocation and assessing performance. The Company’s Acting Chief Executive Officer is its CODM. The Company’s CODM reviews financial information presented on a consolidated basis for the purposes of making operating decisions, allocating resources and evaluating financial performance. Consequently, the Company has determined it operates and manages its business in one operating and one reportable segment. Foreign Currency For the Company and its subsidiaries, the functional currency has been determined to be the U.S. Dollar (USD). Monetary assets and liabilities denominated in foreign currency are remeasured at period-end exchange rates. Non-monetary assets and liabilities denominated in foreign currencies are remeasured at historical rates. Foreign currency transaction gains and losses resulting from remeasurement are recognized in Other expense, net in the Condensed Consolidated Statements of Operations and Comprehensive Loss. Contingencies The Company is subject to various litigation and arbitration claims that arise in the ordinary course of business, including but not limited to those related to employee and shareholder matters. Some of these proceedings involve claims that are subject to substantial uncertainties and unascertainable damages. The Company makes a provision for a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. The Company has determined that no provision for liability nor disclosure is required related to any claim against the Company when: (a) there is not a reasonable possibility that a loss exceeding amounts already recognized (if any) may be incurred with respect to such claim; (b) a reasonably possible loss or range of loss cannot be estimated; or (c) such estimate is immaterial. CARES Act On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief and Economic Security (CARES) Act which, among other things, permits the deferral of the employer’s portion of social security tax payments between March 27, 2020 and December 31, 2020. As of June 30, 2022 and December 31, 2021, approximately $1.8 million and $3.7 million, respectively, of employer payroll tax payments were deferred. The $1.8 million deferred as of June 30, 2022 is due by December 31, 2022. Inventories Inventories, which consist of various types of lab supplies and automation hardware, are stated at the lower of cost or net realizable value using the weighted average cost method. The Company assesses the valuation of its inventories and reduces the carrying value of those inventories that are obsolete or in excess of the Company’s forecasted usage to their estimated net realizable value. If the Company determines that the cost of inventories exceeds its estimated net realizable value, the Company records a write-down equal to the difference between the cost of inventories and the estimated net realizable value. If the future demand for the Company’s services and products is less favorable than the Company’s forecasts, the value of the inventories may be required to be reduced, which could result in additional expense to the Company and affect its results of operations. Goodwill and Acquired Intangible Assets Goodwill is not amortized, but is evaluated for impairment annually, or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The Company performs a goodwill impairment test annually in the fourth quarter. Goodwill impairment is recognized for the amount that the carrying value of the reporting unit, including goodwill, exceeds the reporting unit's fair value. The loss recognized cannot exceed the total amount of goodwill allocated to the reporting unit. The inputs to the Company's business are primarily comprised of a collection of accessible biomolecules, its software and data science technology, and its data driven microbe optimization processes which enable its platform to deliver products and services to its customers. Additionally, the Company manages its platform based on entity wide metrics and consolidated financial results. Therefore, the Company has determined that there is a single reporting unit for the purpose of conducting this goodwill impairment assessment. Intangible assets acquired in a business combination are recorded at their estimated fair values at the date of acquisition. The Company amortizes acquired definite-lived intangible assets over their estimated useful lives based on the pattern of consumption of the economic benefits or, if that pattern cannot be readily determined, on a straight-line basis. Long-Lived Assets The Company evaluates its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is assessed by a comparison of the carrying amount of an asset to future net undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets. The Company's platform provides the lowest level of identifiable independent cash flows. Therefore, for purposes of evaluating potential impairment of the Company's long-lived assets, a single entity-wide asset group exists. Leases Leases (Topic 842) Effective January 1, 2022 The Company determines if an arrangement is or contains a lease at inception by assessing whether the arrangement contains an identified asset and whether the Company has the right to control the identified asset. Lease assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. The Company has a variety of different types of operating leases, the specific terms and conditions of which vary from lease to lease. Certain operating lease agreements include terms such as: (i) renewal and early termination options; (ii) tenant improvement allowances; and (iii) rent escalation clauses. The lease agreements also include provisions for the maintenance of the leased asset and payment of lease related costs. The Company reviews the specific terms and conditions of each lease and, as appropriate, renewal or termination options reasonably certain to be exercised are included in the Company’s lease terms. The Company’s leases do not contain any residual value guarantees. Certain of the Company’s lease agreements include rental payments that may be adjusted in the future based on economic conditions and others include rental payments adjusted periodically for inflation. Variable lease expense is disclosed for the adjusted portion of such payments. Lease income, attributable to subleases, is recognized in Cost and operating expenses on the Condensed Consolidated Statements of Operations and Comprehensive Loss, as the sublease activity is outside Company’s normal business operations. Currently, the Company's sole underlying asset class is real estate. Lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the non-cancelable lease term. Right-of-use assets are recognized for the amount of the lease liability, adjusted for any lease payments made prior to or on lease commencement, lease incentives received and initial direct costs incurred, as applicable. As most of the Company’s operating leases do not provide an implicit rate, the Company uses an estimated incremental borrowing rate based on information available at the date of adoption and subsequent lease commencement dates in calculating the present value of its operating lease liabilities. The incremental borrowing rate is determined using the Company’s synthetic credit rating, adjusted for a credit premium, historical recovery rates of secured debt, and the respective tenor’s risk-free rates determined using U.S. Treasury rates. Revenue Recognition Grant Revenue Grants received are assessed to determine if the agreement should be accounted for as an exchange transaction or a contribution. An agreement is accounted for as a contribution if the resource provider does not receive commensurate value in return for the assets transferred. Contributions are recognized as grant revenue when all donor-imposed conditions have been met. Automation Revenue The Company enters into contracts to sell automation products for laboratory operations, web-based software services, support services or the combinations of products and services. Automation products generally include third party lab equipment hardware, customized enclosures and other elements for the Company's reconfigurable automation cart (“RAC”) system. Services may include one-time service events, such as installation, consultation or design services, or software subscription and support services performed over time. If the contract is comprised of both products and services, the Company applies judgment in determining if those performance obligations are distinct. If the customer can derive benefits from the use of the hardware with or without the services or the customer can derive the benefits from the services together with available resources, such as the previously delivered hardware, then the hardware and services are accounted for as distinct performance obligations. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. The Company’s process for determining the standalone selling price requires judgment and considers multiple factors that are reasonably available and maximizes the use of observable inputs that may vary over time depending upon the unique facts and circumstances related to each performance obligation. The Company believes that this method results in an estimate that represents the price the Company would charge for the product offerings if they were sold separately. Revenue related to the identified distinct performance obligations is recognized when, or as, control of each individual performance obligation is transferred to the customer. For RAC systems control generally transfers to the customer at a point in time. The Company uses present right to payment, legal title, physical possession of the asset, and risks and rewards of ownership as indicators to determine the transfer of control to the customer. If customer acceptance of the product is not a formality, revenue is recognized upon receipt of such customer acceptance. Software subscription and support service revenues are recognized ratably over the respective non-cancelable subscription term as control continuously transfers to the customer. The Company's subscription arrangements are considered service contracts, and the customer does not have the right to take possession of the software. Sales taxes collected from customers and remitted to governmental authorities are not included in revenue. Accounting Pronouncements Adopted In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (“ ASU 2016-02 The Company adopted Topic 842 on January 1, 2022 using the modified retrospective approach with the cumulative effect of adoption recognized to retained earnings on January 1, 2022. Under this method, the Company is allowed to record a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption and not restate prior periods. Additionally, the Company elected the transitional practical expedients such that the Company will not reassess whether contracts are leases and will retain lease classification and initial direct costs for leases existing prior to the adoption of the new standard. The Company also made the following elections: (1) elect the short term lease exception, (2) not elect hindsight and (3) elect to not separate its nonlease components for its real estate leases. Significant assumptions and judgments made in applying the new lease accounting standard include determining the Company’s incremental borrowing rate and evaluating the probability of exercising lease options. On January 1, 2022 the Company recorded total assets and total liabilities on the Condensed Consolidated Balance Sheets of $152.3 million and $189.9 million, respectively, due to the recognition of right-of-use assets and lease liabilities upon adoption, net of the impact of eliminating existing deferred rent liabilities related to its leasing arrangements. The adoption of ASU 2016-02, as amended, did not have a material impact to the Company’s Condensed Consolidated Statements of Operations and Comprehensive Loss or Condensed Consolidated Statements of Cash Flows. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and clarifies and amends existing guidance to improve consistent application. This pronouncement is effective for the Company for fiscal years beginning after December 15, 2021, and for interim periods within fiscal years beginning after December 15, 2022, with early adoption permitted. The Company adopted the new standard on January 1, 2022 using a modified retrospective transition method. The adoption did not have a material impact on the Condensed Consolidated Financial Statements. Recent Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Credit losses (Topic 326) , subsequently amended by ASU 2019-10, which sets forth a “current expected credit loss” model which requires the Company to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost. The standard will become effective for the Company for fiscal years beginning after December 15, 2022. Early adoption is permitted. The Company is evaluating the impact the adoption of this standard will have on its financial statements and related disclosures. |
Business Combination
Business Combination | 6 Months Ended |
Jun. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combination | Business Combination Lodo Therapeutics Corporation On May 16, 2021, the Company completed a nontaxable acquisition of 100% of the equity interests of Lodo Therapeutics Corporation (“Lodo”), a privately-held company which uses its proprietary bacterial metagenomics discovery platform to develop novel therapeutics from nature. The acquisition was accounted for as a business combination. The purchase price for the acquisition was $25.3 million, substantially all of which was non-cash consideration. The non-cash consideration consisted of 774,402 shares of the Company’s common stock. The intangible assets acquired consisted primarily of $29.0 million of goodwill and Lodo’s developed technology of $5.4 million. Goodwill recognized is primarily a measure of the expected synergies from combining the operations of Lodo and the Company’s developed technologies. The Company granted restricted stock units (“RSUs”) to certain employees and consultants of Lodo in connection with the acquisition that generally vest in three installments over a period of up to two years, subject to their continued service with the Company. As a result of the business combination the Company incurred $0.9 million of acquisition related costs for its benefit which are not accounted for as part of consideration transferred. Acquisition related costs related primarily to legal services, accounting, tax, valuation, and due diligence and are recognized in General and administrative expenses on the Condensed Consolidated Statements of Operations and Comprehensive Loss. Pro forma results of operations will not be presented because the effects of this acquisition were not material to the Company’s Condensed Consolidated Financial Statements under applicable SEC rules. |
Restructuring
Restructuring | 6 Months Ended |
Jun. 30, 2022 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring 2021 Restructuring Refer to Note 4 of the “Notes to Consolidated Financial Statements” in the Company's 2021 Form 10-K for additional information related to the Company's 2021 Restructuring. The 2021 Restructuring was substantially complete as of December 31, 2021. The Company does not expect to incur additional restructuring costs under the 2021 Restructuring. The Company expects the 2021 Restructuring to result in total pre-tax charges of approximately $28.5 million and approximately $16.7 million of these charges are estimated to result in cash outlays, of which the Company has made payments of $15.3 million through June 30, 2022. The Company has recorded costs of $28.5 million from the inception of the initiative through June 30, 2022. The following table provides a summary of our costs incurred from the inception of the initiative through June 30, 2022, and cost estimates associated with the 2021 Restructuring, by major type of cost (in thousands): Total amount incurred since inception through June 30, 2022 Total estimated amount expected to be incurred Restructuring charges: Termination benefits $ 8,580 $ 8,580 Impairment of long-lived assets 11,815 11,815 Contract terminations 3,507 3,507 Other (1) 4,591 4,591 Total $ 28,493 $ 28,493 —–—–—–—–—–—– (1) Comprised of other costs directly related to the 2021 Restructuring, including consulting fees in relation to portfolio review, realignment of organizational resources to strategic priorities and organization redesign in order to achieve reduced operating costs. The following table provides a reconciliation of the beginning and ending balances for the restructuring liabilities, which are reported as components of Accounts payable and Accrued and other liabilities in the accompanying Condensed Consolidated Balance Sheets (in thousands): Termination Benefits Contract Terminations Other Total Balance at January 1, 2022 $ 948 $ 1,450 $ — $ 2,398 Charges — — — — Adjustments (73) (242) — (315) Cash Payments, net (846) 92 — (754) Balance at June 30, 2022 $ 29 $ 1,300 $ — $ 1,329 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The following table summarizes goodwill as of June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, Goodwill $ — $ 40,645 The economic and capital market volatility in 2022 and the Company's business plan which required continued funding, resulted in the sustained decrease in the Company's share price. As a result, the Company identified that a possible indicator of impairment was present as of the second quarter of 2022. As such, impairment testing of the Company's goodwill was triggered. To conduct impairment tests of goodwill, the fair value of the reporting unit is compared to its carrying value. If the reporting unit’s carrying value exceeds its fair value, we record an impairment loss to the extent that the carrying value of goodwill exceeds its implied fair value, not to exceed the recorded amount of goodwill. The Company estimated the fair value of the reporting unit using a combination of income-based and market-based methods, including a discounted cash flow method, a market-based revenue multiple method and a probability-weighted scenario of a potential merger transaction based on the terms and information available as of the measurement date, June 30, 2022. The result of the interim impairment test in the second quarter of 2022 indicated that the estimated fair value of the reporting unit was less than its carrying value. Consequently, a non-deductible, non-cash goodwill impairment charge was recorded in the amount of $40.6 million during the three months ended June 30, 2022. The following table summarizes the net book value of the finite-lived intangible assets as of June 30, 2022 and December 31, 2021 (in thousands): Cost Accumulated Intangible Assets, Net June 30, December 31, June 30, December 31, June 30, December 31, Developed technology $ 12,300 $ 12,300 $ (5,104) $ (4,110) $ 7,196 $ 8,190 Customer relationships 1,400 1,400 (1,216) (1,061) 184 339 Total $ 13,700 $ 13,700 $ (6,320) $ (5,171) $ 7,380 $ 8,529 The Company recognized $0.5 million and $0.5 million in amortization expense for the three months ended June 30, 2022 and 2021, and $1.1 million and $0.8 million for the six months ended June 30, 2022 and 2021, respectively. Future amortization of intangible assets is as follows (in thousands): Remainder of 2022 $ 1,099 2023 2,067 2024 1,271 2025 1,271 2026 1,271 Thereafter 401 Total $ 7,380 |
Fair Value Measurements of Fina
Fair Value Measurements of Financial Instruments | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements of Financial Instruments | Fair Value Measurements of Financial Instruments GAAP defines fair value, establishes a framework for measuring fair value, and requires certain disclosures about fair value measurements. GAAP permits an entity to choose to measure many financial instruments and certain other items at fair value and contains financial statement presentation and disclosure requirements for assets and liabilities for which the fair value option is elected. The hierarchy of fair value valuation techniques under GAAP provides for three levels: Level 1 provides the most reliable measure of fair value, whereas Level 3, if applicable, generally would require significant management judgment. The three levels for categorizing assets and liabilities under GAAP’s fair value measurement requirements are as follows: Level 1 – Fair value of the asset or liability is determined using unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 – Fair value of the asset or liability is determined using inputs other than quoted prices that are observable for the applicable asset or liability, either directly or indirectly, such as quoted prices for similar (as opposed to identical) assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3 – Fair value of the asset or liability is determined using unobservable inputs that are significant to the fair value measurement and reflect management’s own assumptions regarding the applicable asset or liability. There were no transfers between the levels during the periods presented. As of June 30, 2022 and December 31, 2021, the Company’s financial assets and financial liabilities measured at fair value on a recurring basis were classified within the fair value hierarchy as follows (in thousands): Level 1 Level 2 Level 3 Balance as of June 30, 2022 Financial Assets Cash equivalents $ 1,669 $ — $ — $ 1,669 Total financial assets $ 1,669 $ — $ — $ 1,669 Level 1 Level 2 Level 3 Balance as of December 31, 2021 Financial Assets Cash equivalents $ 1,667 $ — $ — $ 1,667 Total financial assets $ 1,667 $ — $ — $ 1,667 Financial instruments consist principally of cash equivalents, accounts receivables, accounts payable, accrued liabilities and debt. The following methods and assumptions were used by the Company in estimating the fair value of financial instruments: Accounts receivable, accounts payable, and accrued liabilities: The amounts reported in the accompanying balance sheets approximate fair value due to the short maturity of these instruments. Debt : The gross amounts reported approximate fair value due to the debt being a variable interest rate debt and its relatively short-term maturity. |
Balance Sheet Components
Balance Sheet Components | 6 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Components | Balance Sheet Components Property and equipment consist of the following as of June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, Machinery and equipment $ 76,195 $ 74,548 Leasehold improvements 27,379 31,488 Furniture and office equipment 3,191 3,189 Computers and software 2,775 2,764 109,540 111,989 Less accumulated depreciation and amortization (82,784) (78,132) 26,756 33,857 Construction in progress 43,834 19,942 Total property and equipment, net $ 70,590 $ 53,799 Depreciation and amortization expense was $4.2 million and $4.4 million for the three months ended June 30, 2022 and 2021, and $9.1 million and $8.5 million for the six months ended June 30, 2022 and 2021, respectively. Accrued and other current liabilities consist of the following as of June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, Accrued compensation and compensation-related costs $ 9,089 $ 6,027 Other accrued liabilities 13,317 7,045 Accrued restructuring costs 1,329 2,398 Accrued legal service fees 3,206 1,940 Accrued tax liabilities 68 86 Total accrued and other current liabilities $ 27,009 $ 17,496 Inventories consist of the following as of June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, Consumables $ 5,480 $ 6,035 Automation - Raw materials 627 — Total Inventories $ 6,107 $ 6,035 |
Term Loan
Term Loan | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
Term Loan | Term Loan Except as described below, the Company’s debt is described in Note 8 of the “Notes to Consolidated Financial Statements” in the Company's 2021 Form 10-K. The Company's previously outstanding term loan matured in June 2022, upon which the remaining outstanding principal and applicable prepayment premium were paid. No debt was outstanding at June 30, 2022. Debt consists of the following as of December 31, 2021 (in thousands): December 31, Senior secured delayed draw term loan facility bearing interest equal to 11.5% $ 50,000 Unamortized discount and offering costs (8,310) Accrued end-of-term payment 2,263 Senior secured delayed draw term loan facility, net 43,953 Less current portion 43,953 Long-term debt, net $ — Interest expense on the Company’s term loan consists of the following (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Coupon interest $ 1,453 $ 2,471 $ 2,891 $ 4,914 Amortization of debt discount and offering costs 4,669 296 8,310 580 Accretion of end-of-term payment 3,256 — 6,222 — Total interest expense on term loan $ 9,378 $ 2,767 $ 17,423 $ 5,494 |
Leases
Leases | 6 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
Leases | Leases The Company adopted FASB ASC 842 on January 1, 2022 (Note 2). The Company did not have any finance leases during the six months ended June 30, 2022. In July 2019, the Company entered into an operating lease agreement to rent approximately 58,000 square feet of warehouse and office space in Emeryville, California. In February 2021 the lease was amended to include an additional approximately 10,000 square feet of space. The lease, as amended, features escalating rent with fixed annual increases of approximately 3% from January 2022 and terminates in January 2033 for all leased spaces. The Company has two options to extend the lease by 5 years at the prevailing market rent at the time of extension. The Company did not consider it reasonably certain that it would exercise these options. In July 2019, the Company entered into an operating lease agreement to sublease approximately 76,000 square feet of laboratory and office space in Emeryville, California. The lease features escalating rent with fixed annual increases of approximately 3% starting August 2020 and terminates in March 2031. The Company has no options to extend the sublease beyond its initial term. In October 2019, the Company entered into an operating lease agreement, which was subsequently amended, for a building containing approximately 303,000 square feet of office and laboratory space in Emeryville, California. The lease commenced in February 2021 and terminates in August 2033. The lease provides for two options to extend the term for 5 years at the prevailing market rent at the time of extension. The Company did not consider it reasonably certain that it would exercise these options. Lease payments are subject to a fixed annual escalation of approximately 3%. The lease contains free and reduced rent periods during the initial 1.5 years of the term from the commencement date. Additionally, the lease provides for tenant improvement allowances up to a total of $46.9 million. Components of lease cost recorded in Cost and operating expenses in the Company’s Condensed Consolidated Statement of Operations and Comprehensive Loss for the three and six months ended June 30, 2022 consist of the following (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2022 Operating lease cost $ 8,628 $ 17,437 Operating variable lease cost 1,687 3,306 Operating sublease income (172) (344) Total lease costs $ 10,143 $ 20,399 Rent expense under operating leases, net of sublease income, was $9.5 million and $15.8 million for the three and six months ended June 30, 2021, respectively. Other information related to the Company’s operating leases for the three and six months ended June 30, 2022 is as follows (in thousands, except lease term and discount rate): Three Months Ended June 30, Six Months Ended June 30, 2022 2022 Cash paid for amounts included in operating lease liabilities $ 6,872 $ 11,219 June 30, 2022 Weighted-average remaining operating lease term (in years) 10.43 Weighted-average incremental borrowing rate 12.60 % Maturities of operating lease liabilities at June 30, 2022 are as follows (in thousands): Remainder of 2022 $ 15,717 2023 30,256 2024 30,661 2025 30,253 2026 31,091 Thereafter 208,242 Total 346,220 Less: Interest (160,139) Present value of operating lease liabilities $ 186,081 Maturities of operating sublease payments at June 30, 2022 are as follows (in thousands): Remainder of 2022 $ 343 2023 686 2024 686 2025 114 Thereafter — Total $ 1,829 At December 31, 2021, total future minimum rental commitments under long-term leases, net of sublease income, with an initial term of more than one year were estimated as follows (in thousands): 2022 $ 26,387 2023 30,450 2024 30,630 2025 29,459 2026 30,350 Thereafter 206,587 Total $ 353,863 |
Common Stock
Common Stock | 6 Months Ended |
Jun. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Common Stock | Common Stock Equity Incentive Plans The Company has three stock-based compensation plans – the 2021 Incentive Award Plan (the “2021 Plan”), the 2014 Stock Plan (the “2014 Plan”) and the Employee Stock Purchase Plan (the “ESPP”). As of June 30, 2022, there were 5,866,372 shares available for the Company to grant under the 2021 Plan and 2,758,864 shares available for the Company to grant under the ESPP. The shares available for grant as of June 30, 2022 included 5,152,264 and 1,030,452 shares, respectively, for the 2021 Plan and the ESPP, which represent the annual increases of shares available for grant under those plans. Upon adoption of the 2021 Plan in April 2021, no new awards or grants are permitted under the 2014 Plan. Refer to Note 10 of the “Notes to Consolidated Financial Statements” in the Company's 2021 Form 10-K for additional information related to these stock-based compensation plans. Stock Options with Service-based Vesting Conditions The following table summarizes option activity under the 2021 Plan and the 2014 Plan: Number of Weighted Weighted Aggregate (in thousands) Outstanding - December 31, 2021 7,555,966 $12.55 8.15 $3,668 Options granted — — Options exercised (77,093) $3.94 Options cancelled (967,266) $10.28 Outstanding - June 30, 2022 6,511,607 $12.99 7.80 $13 Unvested - June 30, 2022 3,448,905 $15.15 8.87 — Exercisable - June 30, 2022 3,062,702 $10.57 6.60 $13 No options were granted during the six months ended June 30, 2022. The weighted average grant-date fair value of options granted was $18.33 per share, during the six months ended June 30, 2021. The aggregate intrinsic value of stock option awards exercised, determined at the date of option exercise, was $0.1 million and $25.8 million, during the six months ended June 30, 2022, and 2021, respectively. The aggregate intrinsic value was calculated as the difference between the exercise prices of the underlying stock option awards and the estimated fair value of the Company’s common stock on the date of exercise. Stock-based compensation expense for stock options is estimated at the grant date based on the fair-value calculated using the Black-Scholes option pricing model. The fair value of employee stock options is recognized as an expense ratably over the requisite service period of the awards. The fair value of employee stock options was estimated using the following assumptions, in periods for which options were granted: Three Months Ended June 30, Six Months Ended June 30, 2021 2021 Expected dividend yield — % — % Risk-free interest rate 1.04% - 1.09% 0.77% - 1.09% Expected term (in years) 6.08 6.08 Expected volatility 73.03% - 74.27% 73.03% - 74.67% As of June 30, 2022 the Company had employee stock-based compensation expense of $29.6 million related to unvested stock options not yet recognized, which is expected to be recognized over an estimated weighted average period of approximately 2.37 years. Stock Options with Market-based Vesting Conditions Except as described below, the Company’s stock options with market-based vesting conditions debt is described in Note 10 of the “Notes to Consolidated Financial Statements” in the Company's 2021 Form 10-K. As of June 30, 2022, 458,333 options remain outstanding and unvested. As of June 30, 2022, the Company has $5.4 million of stock based compensation related to these unvested stock options not yet recognized, which is expected to be recognized over an estimated weighted average period of approximately 2.03 years. Restricted Stock Units with Service-based Vesting Conditions The following table summarizes RSU activity (in thousands, except share and per share amounts and term): Shares Weighted Average Non-vested Restricted Stock Units as of December 31, 2021 2,475,983 $13.47 Granted 6,760,327 $3.03 Vested (428,912) $6.65 Forfeited (646,311) $8.18 Non-vested Restricted Stock Units as of June 30, 2022 8,161,087 $5.60 RSUs granted are valued at the market price of our common stock on the date of grant. The Company recognizes compensation expense for the fair value of RSUs ratably over the requisite service period of the awards. The total intrinsic value of RSUs vested was $0.7 million during the six months ended June 30, 2022. As of June 30, 2022 there was $38.6 million of total unrecognized compensation cost related to RSUs, which is expected to be recognized over a weighted average period of 1.93 years. Compensation Expense Compensation expense related to stock-based awards was included in the following categories in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Loss in accordance with the accounting guidance for share-based payments for the three and six months ended June 30, 2022 and 2021 (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Cost of service revenue $ 661 $ 944 $ 1,462 $ 1,368 Cost of automation revenue 24 — 24 — Research and development 3,248 2,537 5,595 3,290 Sales and marketing 473 366 911 561 General and administrative 4,236 3,118 8,041 3,999 Total stock-based compensation $ 8,642 $ 6,965 $ 16,033 $ 9,218 Compensation expense by stock-based award was as follows for the three and six months ended June 30, 2022 and 2021 (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Stock options with service based vesting conditions $ 3,805 $ 3,356 $ 7,797 $ 5,526 Stock options with market based vesting conditions 685 2,414 1,362 2,414 RSUs with service based vesting conditions 4,010 585 6,518 585 Non-vested stock — 83 — 166 ESPP 142 527 356 527 Total stock-based compensation $ 8,642 $ 6,965 $ 16,033 $ 9,218 |
Net Loss Per Share
Net Loss Per Share | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is determined by dividing net loss by the weighted average shares outstanding for the period. The Company analyzes the potential dilutive effect of stock options, non-vested stock, RSUs, stock issuable under the ESPP, and warrants under the treasury stock method (as applicable), during periods of income, or during periods in which income is recognized related to changes in fair value of its liability-classified securities. The following table presents the calculation of basic and diluted net loss per share (in thousands, except share and per share data) applicable to common stockholders for the three and six months ended June 30, 2022 and 2021: Three Months Ended Six Months Ended 2022 2021 2022 2021 Numerator: Net loss, basic $ (116,468) $ (100,866) $ (188,584) $ (185,451) Less: Gain on change in fair value of warrant liabilities — — — 1,849 Net loss, diluted $ (116,468) $ (100,866) $ (188,584) $ (187,300) Denominator: Weighted average shares used in calculating net loss per share, basic 103,482,907 77,671,643 103,297,070 45,512,654 Effect of dilutive securities: Warrants to purchase Series C convertible preferred stock — — — 214,499 Weighted average shares used in calculating net loss per share, diluted 103,482,907 77,671,643 103,297,070 45,727,153 Net loss per share, basic $ (1.13) $ (1.30) $ (1.83) $ (4.07) Net loss per share, diluted $ (1.13) $ (1.30) $ (1.83) $ (4.10) The following potentially dilutive shares as of the periods ended June 30, 2022, and 2021, were excluded from the calculation of diluted net loss per share applicable to common stockholders because their effect would have been anti-dilutive for the periods presented: June 30, 2022 June 30, 2021 Options to purchase common stock 6,511,607 6,349,331 Restricted stock units 8,161,087 203,433 Non-vested stock — 33,620 Total 14,672,694 6,586,384 |
Revenue, Credit Concentrations
Revenue, Credit Concentrations and Geographic Information | 6 Months Ended |
Jun. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, Credit Concentrations and Geographic Information | Revenue, Credit Concentrations and Geographic Information Revenues from research and development service agreements The Company’s R&D service contracts generally consist of fixed-fee multi-phase research terms with concurrent value-share and/or performance bonus payments based on developing an improved microbial strain. The research term of the contracts typically spans several quarters and the contract term for revenue recognition purposes is determined based on the customer’s rights to terminate the contract for convenience. Other payment types, typically consisting of performance bonuses or value share payments, are constrained until those payments become probable or are earned. The Company recognized performance bonuses of $0.3 million for the three and six months ended June 30, 2021. For the three and six months ended June 30, 2022, performance bonuses the Company recognized were insignificant. For the three and six months ended June 30, 2022 and 2021, the Company has not recognized any royalty or value share payments. When acceptance clauses are present in an agreement, the Company recognizes the R&D service revenue at a point in time when the R&D services provided have been accepted by the customer and the Company has a present right for payment and no refunds are permitted. The Company recognized revenue at a point in time due to customer acceptance clauses of $1.5 million for the three months ended June 30, 2021. For the three months ended June 30, 2022, revenue recognized at a point in time due to customer acceptance clauses were insignificant. The Company recognized revenue at a point in time due to customer acceptance clauses of $0.5 million and $2.3 million for the six months ended June 30, 2022 and 2021, respectively. Automation Revenue The Company's automation contract generally consists of fixed consideration for the delivery of hardware and software subscription and support services over a specified period of time. The Company recognizes revenue related to the delivery of hardware at a point in time when the hardware has been accepted by the customer and the Company has a present right for payment and no refunds are permitted. Revenue for the delivery of automation services is recognized over time as the customer receives and consumes the benefits of the automation services. The Company recognized revenue at a point in time for the delivery of automation hardware of $0.5 million for the three and six months ended June 30, 2022. Contract Balances The following table represents changes in the balances of our contract liabilities during the periods ended June 30, 2022, and 2021 (in thousands): December 31, 2021 Additions Adjustments Deletions June 30, 2022 Contract liabilities: Deferred revenue $ 8,195 $ 1,260 $ — $ (3,586) $ 5,869 December 31, 2020 Additions Adjustments Deletions June 30, 2021 Contract liabilities: Deferred revenue $ 3,014 $ 7,057 $ 6,819 $ (5,764) $ 11,126 Long-term deferred revenue is included in Other long-term liabilities on the Condensed Consolidated Balance Sheets. Adjustments to deferred revenue for the period ended June 30, 2021 are attributable to the adoption of ASU 2021-08, as applied to a customer contract in connection with the acquisition of Lodo (Note 2). Performance Obligations Transaction price allocated to the remaining performance obligation represents contracted revenue that has not yet been recognized, which includes unearned revenue and unbilled amounts that will be recognized as revenue in future periods. Remaining performance obligations consist of the following (in thousands): Current Noncurrent Total As of June 30, 2022 $ 5,108 $ 4,099 $ 9,207 The Company’s noncurrent remaining performance obligation is expected to be recognized in the next 1.1 to 3.0 years. Grant Revenue On October 10, 2021, the Company entered into a grant agreement with the Bill & Melinda Gates Foundation under which it was awarded a grant totaling up to $2.9 million to discover potential natural product hits for malaria, tuberculosis, and COVID-19 targets. This grant agreement will remain in effect until February 28, 2023, unless earlier terminated by the Bill & Melinda Gates Foundation for the Company’s breach of the terms of the grant agreement, failure to progress the funded project, in the event of the Company’s change of control, change in the Company’s tax status, or significant changes in the Company’s leadership that the Bill & Melinda Gates Foundation reasonably believes may threaten the success of the project. Payments received in advance that are related to future research activities are deferred and recognized as revenue when the donor-imposed conditions are met, which is as the research and development activities are performed. The Company recognized grant revenue of $0.2 million and $0.5 million for the three and six months ended June 30, 2022, respectively. As of June 30, 2022, the Company has deferred revenue of $2.3 million under this grant agreement. Credit Concentrations Customers representing 10% or greater of revenue were as follows for the three and six months ended June 30, 2022 and 2021: Three Months Ended Six Months Ended 2022 2021 2022 2021 Customer A — % * 23 % * Customer B 25 % 17 % 26 % 22 % Customer C 25 % 10 % 17 % 12 % Customer E — % 40 % — % 31 % Customer H 20 % * 13 % * Customer I 18 % — % * — % —–—–—–—–—–—– * Less than 10% Customers representing 10% or greater of billed accounts receivable were as follows as of June 30, 2022 and December 31, 2021: June 30, December 31, Customer C 43 % — % Customer F * 68 % Customer G — % 29 % Customer I 50 % — % —–—–—–—–—–—– * Less than 10% Geographic Information The Company's revenues by geographic region are presented in the table below for the three and six months ended June 30, 2022 and 2021 (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 United States of America $ 1,937 $ 1,782 $ 3,806 $ 3,014 Asia 692 1,308 1,944 2,729 Europe 5 2,764 1,675 3,846 Total revenue $ 2,634 $ 5,854 $ 7,425 $ 9,589 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company is subject to various litigation and arbitration claims that arise in the ordinary course of business, including but not limited to those related to employee matters. Unless otherwise specifically disclosed, we have determined that no provision for liability is required related to any claim against the Company. On August 4, 2021, a putative securities class action was filed on behalf of purchasers of the Company's common stock pursuant to or traceable to the registration statement for its IPO. The action is pending in the United States District Court for the Northern District of California, and is captioned Shankar v. Zymergen Inc. et al. , Case No. 3:21-cv-06028-JCS. The action alleges violations of Sections 11 and 15 of the Securities Act of 1933, as amended, in connection with the Company's IPO, names the Company, certain of our current and former officers and directors, our IPO underwriters, and certain stockholders as defendants and seeks damages in an unspecified amount, attorneys’ fees, and other remedies. The Company intends to defend vigorously against such allegations. On November 9, 2021, a purported shareholder of Zymergen filed a putative derivative lawsuit in the United States District Court for the Northern District of California that is captioned Mellor v. Hoffman, et al. , Case No. 4:21-cv-08723. The complaint names certain of the Company’s current and former officers and directors and the Company as nominal defendants based on allegations substantially similar to those in the securities class action. The complaint purports to assert claims on the Company’s behalf for breach of fiduciary duty, unjust enrichment, abuse of control, gross mismanagement, corporate waste, and contribution under the federal securities laws and seeks corporate reforms, unspecified damages and restitution, and fees and costs. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Proposed Merger On July 24, 2022, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Ginkgo Bioworks Holdings, Inc., a Delaware corporation (“Ginkgo”), and Pepper Merger Subsidiary Inc., a Delaware corporation and an indirect wholly owned subsidiary of Ginkgo (“Merger Sub”), providing for the merger of Merger Sub with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly owned subsidiary of Ginkgo. Capitalized terms used herein but not otherwise defined have the meaning set forth in the Merger Agreement. Merger Consideration At the effective time of the Merger (the “Effective Time”), each share of common stock, par value $0.001 per share, of the Company (“Company Common Shares”) that is issued and outstanding as of immediately prior to the Effective Time (other than certain excluded shares specified in the Merger Agreement) will be automatically cancelled, extinguished and converted into the right to receive 0.9179 of a share of Class A Common Stock, par value $0.0001 per share, of Ginkgo (“Ginkgo Class A Shares,” and such consideration, the “Merger Consideration”) and cash in lieu of any fractional Ginkgo Class A Shares, without interest. Treatment of Equity Awards At the Effective Time, each option to purchase Company Common Shares (each, a “Company Option”) with an exercise price per share less than the Merger Consideration Value that is outstanding immediately prior to the Effective Time, whether vested or unvested, will be cancelled and converted into the right to receive a number of Ginkgo Class A Shares equal to the Option Consideration Value with respect such Company Option divided by the Ginkgo Class A Share Price, and each Company Option with an exercise price per share that is equal to or greater than the Merger Consideration Value will be cancelled for no consideration. “Option Consideration Value” means an amount, without interest, equal to the product of (i) the excess of (A) the Merger Consideration Value over (B) the exercise price per share of such Company Option, and (ii) the total number of Company Common Shares issuable upon exercise in full of such Company Option. “Merger Consideration Value” means an amount (rounded down to the nearest whole cent) equal to the product of (x) the Merger Consideration and (y) the Ginkgo Class A Share Price. “Ginkgo Class A Share Price” means the volume-weighted average price of Ginkgo Class A Shares on the New York Stock Exchange (“NYSE”) for the period of five consecutive trading days ending on and including the second full trading day prior to the Effective Time. At the Effective Time, each vested Company restricted stock unit (each, a “Company RSU”) that is outstanding immediately prior to the Effective Time (including after giving effect to any acceleration of vesting to which such Company RSU is entitled as of immediately prior to the Effective Time) will be cancelled and converted into a right to receive the Merger Consideration. Each unvested Company RSU that is outstanding immediately prior to the Effective Time will be cancelled and converted into a Ginkgo restricted stock unit award (“Ginkgo RSU”) with respect to the number of Ginkgo Class A Shares that is equal to the product of (A) the number of Company Common Shares subject to such unvested Company RSU as of immediately prior to the Effective Time and (B) the Merger Consideration, rounded down to the nearest whole share, which such Ginkgo RSU award will be subject to the same vesting terms and conditions applicable to the Company RSU to which it relates as of immediately prior to the Effective Time, including any applicable vesting acceleration provisions in connection with such holder’s termination of employment or service but otherwise will be subject to the terms and conditions of Ginkgo’s 2021 stock incentive award plan. Conditions to Closing The parties’ obligation to consummate the Merger is subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement, including, among others: (i) the adoption of the Merger Agreement by the holders of a majority of the Company Common Shares outstanding, (ii) the expiration or termination of the waiting periods applicable to the consummation of the Merger under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and, if a merger control inquiry is initiated or commenced by a governmental authority outside of the United States, approval in that jurisdiction, (iii) the absence of any law or order restraining, enjoining or otherwise prohibiting the Merger, (iv) Ginkgo’s registration statement on Form S-4 having been declared effective in accordance with the provisions of the Securities Act of 1933, as amended, (v) authorization and approval of the shares of Ginkgo Class A Common Stock for listing on NYSE (or any successor inter-dealer quotation system or stock exchange thereto), (vi) no material adverse effect has occurred on the other party since the signing of the Merger Agreement that is continuing and (vii) certain other customary conditions relating to the other party’s representations and warranties in the Merger Agreement and the performance of its respective obligations. Ginkgo’s obligation to consummate the Merger is also subject to the satisfaction or waiver of the condition that (i) the Company has not incurred or otherwise become liable for additional costs, expenses or liabilities to the Company or its subsidiaries with respect to its leased real property not contemplated under a specified schedule outlining its real estate plans and (ii) certain specified litigation matters are not reasonably expected to result in future money damages payable by the Company or its subsidiaries (in excess of any applicable insurance deductible and coverage amounts), where, the aggregate of clauses (i) and (ii), exceed $25,000,000. Representations and Warranties; Covenants The Company and Ginkgo have made customary representations and warranties in the Merger Agreement and have agreed to certain covenants regarding the operation of the business of the Company and its subsidiaries and the business of Ginkgo and its subsidiaries prior to the Effective Time. The Company will be also subject to customary “no-shop” restrictions on its ability to solicit alternative acquisition proposals from third parties and to provide information to, and participate in discussions and engage in negotiations with, third parties regarding any alternative acquisition proposals, subject to a “fiduciary out” provision that allows the Company, under certain specified circumstances, to provide information to, and participate in discussions and engage in negotiations with, third parties with respect to an alternative acquisition proposal if the Company Board (or a committee thereof) has determined in good faith (after consultation with its outside legal counsel and financial advisors) that (i) such alternative acquisition proposal either constitutes a Superior Proposal or would reasonably be expected to lead to a Superior Proposal and (ii) the failure to take such actions would be reasonably likely to be inconsistent with the directors’ fiduciary duties under applicable law. The parties have also agreed to use their reasonable best efforts to consummate the Merger. The Merger Agreement contains certain termination rights for each of the Company and Ginkgo. The Merger Agreement may be terminated at any time prior to the Effective Time by the mutual written consent of the parties and in certain other circumstances, including among others, if (i) the Merger has not been consummated by January 24, 2023, subject to two extension rights by the parties of three months each (for a total of twelve months from the signing of the Merger Agreement) if all of the closing conditions other than certain conditions related to receipt of regulatory approvals are satisfied or waived (or are capable of being satisfied at such time) and (ii) the other party has breached any of its representations and warranties or failed to perform any of its covenants under the Merger Agreement such that a closing condition is not satisfied (subject to notice and cure and other customary exceptions). Additionally, Ginkgo may terminate the Merger Agreement in certain circumstances where there is a material and adverse development in certain specified litigation matters. Upon termination of the Merger Agreement in accordance with its terms, under specified circumstances, either party may be required to pay a termination fee to the other party. If the Merger Agreement is validly terminated in connection with certain specified circumstances, including due to the Company accepting a Superior Proposal, willful and material breach of its no-shop obligations, or the Company Board’s withdrawal or change of its recommendation of the Merger to its stockholders, then the Company will be required to pay a termination fee to Ginkgo equal to $10,000,000. Additionally, the Company will be required to pay this termination fee to Ginkgo if the Merger Agreement is terminated in certain circumstances and the Company enters into an agreement or completes an alternative proposal to acquire the Company within twelve months of such termination. Ginkgo will be required to pay a termination fee to the Company equal to $10,000,000 only if the Merger Agreement is validly terminated under specified circumstances upon the failure to satisfy certain conditions related to receipt of regulatory approvals if all other conditions have been satisfied or waived (or are capable of being satisfied at such time). The above description of the Merger Agreement is only a summary, does not purport to be complete and is qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which is incorporated by reference as Exhibit 2.1 to this Quarterly Report on Form 10-Q. 2022 Restructuring |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Preparation | Basis of Preparation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the SEC regarding interim financial reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP have been condensed or omitted, and accordingly the balance sheet as of December 31, 2021 has been derived from audited financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements. These unaudited interim Condensed Consolidated Financial Statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair presentation of the financial information. The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any other interim period or for any other future year. The accompanying unaudited Condensed Consolidated Financial Statements and related financial information should be read in conjunction with the audited financial statements and the related notes thereto for the year ended December 31, 2021 included in the Company's 2021 Form 10-K. The Company has reclassified certain prior year amounts to conform with current period presentation. |
Principles of Consolidation | Principles of Consolidation These Condensed Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated upon consolidation. |
Fiscal Year | Fiscal Year The Company’s fiscal year ends on December 31. References to fiscal 2022, for example, refer to the fiscal year ended December 31, 2022. The period end for the Company covered by this report is June 30, 2022. |
Use of Estimates | Use of Estimates The presentation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. These estimates include, but are not limited to, standalone selling price of performance obligations for contracts with multiple performance obligations, estimate of variable consideration from revenue contracts, useful life of property and equipment, fair value of the reporting unit for purposes of the assessment of goodwill impairment and undiscounted cash flows and residual values of long-lived assets of which the carrying value may not be recoverable, allowance for doubtful accounts, net realizable value of inventories, the valuation of intangible assets, the valuation of common and preferred stock used in the valuation of options to purchase common stock and warrants to purchase common stock or preferred stock, prior to being a publicly traded company, and the incremental borrowing rate used in determining operating lease liabilities. Actual results could differ from those estimates. |
Segment Information | Segment Information Operating segments are identified as components of an enterprise about which discrete financial information is available for evaluation by the chief operating decision-maker (“CODM”) in deciding resource allocation and assessing performance. The Company’s Acting Chief Executive Officer is its CODM. The Company’s CODM reviews financial information presented on a consolidated basis for the purposes of making operating decisions, allocating resources and evaluating financial performance. Consequently, the Company has determined it operates and manages its business in one operating and one reportable segment. |
Foreign Currency | Foreign Currency For the Company and its subsidiaries, the functional currency has been determined to be the U.S. Dollar (USD). Monetary assets and liabilities denominated in foreign currency are remeasured at period-end exchange rates. Non-monetary assets and liabilities denominated in foreign currencies are remeasured at historical rates. Foreign currency transaction gains and losses resulting from remeasurement are recognized in Other expense, net in the Condensed Consolidated Statements of Operations and Comprehensive Loss. |
Contingencies | Contingencies The Company is subject to various litigation and arbitration claims that arise in the ordinary course of business, including but not limited to those related to employee and shareholder matters. Some of these proceedings involve claims that are subject to substantial uncertainties and unascertainable damages. The Company makes a provision for a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. The Company has determined that no provision for liability nor disclosure is required related to any claim against the Company when: (a) there is not a reasonable possibility that a loss exceeding amounts already recognized (if any) may be incurred with respect to such claim; (b) a reasonably possible loss or range of loss cannot be estimated; or (c) such estimate is immaterial. |
Inventories | Inventories Inventories, which consist of various types of lab supplies and automation hardware, are stated at the lower of cost or net realizable value using the weighted average cost method. The Company assesses the valuation of its inventories and reduces the carrying value of those inventories that are obsolete or in excess of the Company’s forecasted usage to their estimated net realizable value. If the Company determines that the cost of inventories exceeds its estimated net realizable value, the Company records a write-down equal to the difference between the cost of inventories and the estimated net realizable value. If the future demand for the Company’s services and products is less favorable than the Company’s forecasts, the value of the inventories may be required to be reduced, which could result in additional expense to the Company and affect its results of operations. |
Goodwill and Acquired Intangible Assets | Goodwill and Acquired Intangible Assets Goodwill is not amortized, but is evaluated for impairment annually, or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The Company performs a goodwill impairment test annually in the fourth quarter. Goodwill impairment is recognized for the amount that the carrying value of the reporting unit, including goodwill, exceeds the reporting unit's fair value. The loss recognized cannot exceed the total amount of goodwill allocated to the reporting unit. The inputs to the Company's business are primarily comprised of a collection of accessible biomolecules, its software and data science technology, and its data driven microbe optimization processes which enable its platform to deliver products and services to its customers. Additionally, the Company manages its platform based on entity wide metrics and consolidated financial results. Therefore, the Company has determined that there is a single reporting unit for the purpose of conducting this goodwill impairment assessment. Intangible assets acquired in a business combination are recorded at their estimated fair values at the date of acquisition. The Company amortizes acquired definite-lived intangible assets over their estimated useful lives based on the pattern of consumption of the economic benefits or, if that pattern cannot be readily determined, on a straight-line basis. |
Long-Lived Assets | Long-Lived Assets The Company evaluates its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is assessed by a comparison of the carrying amount of an asset to future net undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets. The Company's platform provides the lowest level of identifiable independent cash flows. Therefore, for purposes of evaluating potential impairment of the Company's long-lived assets, a single entity-wide asset group exists. |
Leases | Leases Leases (Topic 842) Effective January 1, 2022 The Company determines if an arrangement is or contains a lease at inception by assessing whether the arrangement contains an identified asset and whether the Company has the right to control the identified asset. Lease assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. The Company has a variety of different types of operating leases, the specific terms and conditions of which vary from lease to lease. Certain operating lease agreements include terms such as: (i) renewal and early termination options; (ii) tenant improvement allowances; and (iii) rent escalation clauses. The lease agreements also include provisions for the maintenance of the leased asset and payment of lease related costs. The Company reviews the specific terms and conditions of each lease and, as appropriate, renewal or termination options reasonably certain to be exercised are included in the Company’s lease terms. The Company’s leases do not contain any residual value guarantees. Certain of the Company’s lease agreements include rental payments that may be adjusted in the future based on economic conditions and others include rental payments adjusted periodically for inflation. Variable lease expense is disclosed for the adjusted portion of such payments. Lease income, attributable to subleases, is recognized in Cost and operating expenses on the Condensed Consolidated Statements of Operations and Comprehensive Loss, as the sublease activity is outside Company’s normal business operations. Currently, the Company's sole underlying asset class is real estate. Lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the non-cancelable lease term. Right-of-use assets are recognized for the amount of the lease liability, adjusted for any lease payments made prior to or on lease commencement, lease incentives received and initial direct costs incurred, as applicable. As most of the Company’s operating leases do not provide an implicit rate, the Company uses an estimated incremental borrowing rate based on information available at the date of adoption and subsequent lease commencement dates in calculating the present value of its operating lease liabilities. The incremental borrowing rate is determined using the Company’s synthetic credit rating, adjusted for a credit premium, historical recovery rates of secured debt, and the respective tenor’s risk-free rates determined using U.S. Treasury rates. |
Revenue Recognition | Revenue Recognition Grant Revenue Grants received are assessed to determine if the agreement should be accounted for as an exchange transaction or a contribution. An agreement is accounted for as a contribution if the resource provider does not receive commensurate value in return for the assets transferred. Contributions are recognized as grant revenue when all donor-imposed conditions have been met. Automation Revenue The Company enters into contracts to sell automation products for laboratory operations, web-based software services, support services or the combinations of products and services. Automation products generally include third party lab equipment hardware, customized enclosures and other elements for the Company's reconfigurable automation cart (“RAC”) system. Services may include one-time service events, such as installation, consultation or design services, or software subscription and support services performed over time. If the contract is comprised of both products and services, the Company applies judgment in determining if those performance obligations are distinct. If the customer can derive benefits from the use of the hardware with or without the services or the customer can derive the benefits from the services together with available resources, such as the previously delivered hardware, then the hardware and services are accounted for as distinct performance obligations. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. The Company’s process for determining the standalone selling price requires judgment and considers multiple factors that are reasonably available and maximizes the use of observable inputs that may vary over time depending upon the unique facts and circumstances related to each performance obligation. The Company believes that this method results in an estimate that represents the price the Company would charge for the product offerings if they were sold separately. Revenue related to the identified distinct performance obligations is recognized when, or as, control of each individual performance obligation is transferred to the customer. For RAC systems control generally transfers to the customer at a point in time. The Company uses present right to payment, legal title, physical possession of the asset, and risks and rewards of ownership as indicators to determine the transfer of control to the customer. If customer acceptance of the product is not a formality, revenue is recognized upon receipt of such customer acceptance. Software subscription and support service revenues are recognized ratably over the respective non-cancelable subscription term as control continuously transfers to the customer. The Company's subscription arrangements are considered service contracts, and the customer does not have the right to take possession of the software. Sales taxes collected from customers and remitted to governmental authorities are not included in revenue. |
Accounting Pronouncements Adopted and Recent Accounting Pronouncements Not Yet Adopted | Accounting Pronouncements Adopted In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (“ ASU 2016-02 The Company adopted Topic 842 on January 1, 2022 using the modified retrospective approach with the cumulative effect of adoption recognized to retained earnings on January 1, 2022. Under this method, the Company is allowed to record a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption and not restate prior periods. Additionally, the Company elected the transitional practical expedients such that the Company will not reassess whether contracts are leases and will retain lease classification and initial direct costs for leases existing prior to the adoption of the new standard. The Company also made the following elections: (1) elect the short term lease exception, (2) not elect hindsight and (3) elect to not separate its nonlease components for its real estate leases. Significant assumptions and judgments made in applying the new lease accounting standard include determining the Company’s incremental borrowing rate and evaluating the probability of exercising lease options. On January 1, 2022 the Company recorded total assets and total liabilities on the Condensed Consolidated Balance Sheets of $152.3 million and $189.9 million, respectively, due to the recognition of right-of-use assets and lease liabilities upon adoption, net of the impact of eliminating existing deferred rent liabilities related to its leasing arrangements. The adoption of ASU 2016-02, as amended, did not have a material impact to the Company’s Condensed Consolidated Statements of Operations and Comprehensive Loss or Condensed Consolidated Statements of Cash Flows. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and clarifies and amends existing guidance to improve consistent application. This pronouncement is effective for the Company for fiscal years beginning after December 15, 2021, and for interim periods within fiscal years beginning after December 15, 2022, with early adoption permitted. The Company adopted the new standard on January 1, 2022 using a modified retrospective transition method. The adoption did not have a material impact on the Condensed Consolidated Financial Statements. Recent Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Credit losses (Topic 326) , subsequently amended by ASU 2019-10, which sets forth a “current expected credit loss” model which requires the Company to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost. The standard will become effective for the Company for fiscal years beginning after December 15, 2022. Early adoption is permitted. The Company is evaluating the impact the adoption of this standard will have on its financial statements and related disclosures. |
Restructuring (Tables)
Restructuring (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | The following table provides a summary of our costs incurred from the inception of the initiative through June 30, 2022, and cost estimates associated with the 2021 Restructuring, by major type of cost (in thousands): Total amount incurred since inception through June 30, 2022 Total estimated amount expected to be incurred Restructuring charges: Termination benefits $ 8,580 $ 8,580 Impairment of long-lived assets 11,815 11,815 Contract terminations 3,507 3,507 Other (1) 4,591 4,591 Total $ 28,493 $ 28,493 —–—–—–—–—–—– (1) Comprised of other costs directly related to the 2021 Restructuring, including consulting fees in relation to portfolio review, realignment of organizational resources to strategic priorities and organization redesign in order to achieve reduced operating costs. The following table provides a reconciliation of the beginning and ending balances for the restructuring liabilities, which are reported as components of Accounts payable and Accrued and other liabilities in the accompanying Condensed Consolidated Balance Sheets (in thousands): Termination Benefits Contract Terminations Other Total Balance at January 1, 2022 $ 948 $ 1,450 $ — $ 2,398 Charges — — — — Adjustments (73) (242) — (315) Cash Payments, net (846) 92 — (754) Balance at June 30, 2022 $ 29 $ 1,300 $ — $ 1,329 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Value of Goodwill | The following table summarizes goodwill as of June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, Goodwill $ — $ 40,645 |
Finite-Lived Intangible Assets | The following table summarizes the net book value of the finite-lived intangible assets as of June 30, 2022 and December 31, 2021 (in thousands): Cost Accumulated Intangible Assets, Net June 30, December 31, June 30, December 31, June 30, December 31, Developed technology $ 12,300 $ 12,300 $ (5,104) $ (4,110) $ 7,196 $ 8,190 Customer relationships 1,400 1,400 (1,216) (1,061) 184 339 Total $ 13,700 $ 13,700 $ (6,320) $ (5,171) $ 7,380 $ 8,529 |
Future Amortization of Intangible Assets | Future amortization of intangible assets is as follows (in thousands): Remainder of 2022 $ 1,099 2023 2,067 2024 1,271 2025 1,271 2026 1,271 Thereafter 401 Total $ 7,380 |
Fair Value Measurements of Fi_2
Fair Value Measurements of Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | As of June 30, 2022 and December 31, 2021, the Company’s financial assets and financial liabilities measured at fair value on a recurring basis were classified within the fair value hierarchy as follows (in thousands): Level 1 Level 2 Level 3 Balance as of June 30, 2022 Financial Assets Cash equivalents $ 1,669 $ — $ — $ 1,669 Total financial assets $ 1,669 $ — $ — $ 1,669 Level 1 Level 2 Level 3 Balance as of December 31, 2021 Financial Assets Cash equivalents $ 1,667 $ — $ — $ 1,667 Total financial assets $ 1,667 $ — $ — $ 1,667 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Property and Equipment | Property and equipment consist of the following as of June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, Machinery and equipment $ 76,195 $ 74,548 Leasehold improvements 27,379 31,488 Furniture and office equipment 3,191 3,189 Computers and software 2,775 2,764 109,540 111,989 Less accumulated depreciation and amortization (82,784) (78,132) 26,756 33,857 Construction in progress 43,834 19,942 Total property and equipment, net $ 70,590 $ 53,799 |
Accrued and Other Current Liabilities | Accrued and other current liabilities consist of the following as of June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, Accrued compensation and compensation-related costs $ 9,089 $ 6,027 Other accrued liabilities 13,317 7,045 Accrued restructuring costs 1,329 2,398 Accrued legal service fees 3,206 1,940 Accrued tax liabilities 68 86 Total accrued and other current liabilities $ 27,009 $ 17,496 |
Inventories | Inventories consist of the following as of June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, Consumables $ 5,480 $ 6,035 Automation - Raw materials 627 — Total Inventories $ 6,107 $ 6,035 |
Term Loan (Tables)
Term Loan (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
Long-Term Debt, Net | Debt consists of the following as of December 31, 2021 (in thousands): December 31, Senior secured delayed draw term loan facility bearing interest equal to 11.5% $ 50,000 Unamortized discount and offering costs (8,310) Accrued end-of-term payment 2,263 Senior secured delayed draw term loan facility, net 43,953 Less current portion 43,953 Long-term debt, net $ — |
Interest Expense | Interest expense on the Company’s term loan consists of the following (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Coupon interest $ 1,453 $ 2,471 $ 2,891 $ 4,914 Amortization of debt discount and offering costs 4,669 296 8,310 580 Accretion of end-of-term payment 3,256 — 6,222 — Total interest expense on term loan $ 9,378 $ 2,767 $ 17,423 $ 5,494 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
Components of Lease and Other Information | Components of lease cost recorded in Cost and operating expenses in the Company’s Condensed Consolidated Statement of Operations and Comprehensive Loss for the three and six months ended June 30, 2022 consist of the following (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2022 Operating lease cost $ 8,628 $ 17,437 Operating variable lease cost 1,687 3,306 Operating sublease income (172) (344) Total lease costs $ 10,143 $ 20,399 Other information related to the Company’s operating leases for the three and six months ended June 30, 2022 is as follows (in thousands, except lease term and discount rate): Three Months Ended June 30, Six Months Ended June 30, 2022 2022 Cash paid for amounts included in operating lease liabilities $ 6,872 $ 11,219 June 30, 2022 Weighted-average remaining operating lease term (in years) 10.43 Weighted-average incremental borrowing rate 12.60 % |
Maturities of Operating Lease Liabilities | Maturities of operating lease liabilities at June 30, 2022 are as follows (in thousands): Remainder of 2022 $ 15,717 2023 30,256 2024 30,661 2025 30,253 2026 31,091 Thereafter 208,242 Total 346,220 Less: Interest (160,139) Present value of operating lease liabilities $ 186,081 |
Maturities of Operating Sublease Payments | Maturities of operating sublease payments at June 30, 2022 are as follows (in thousands): Remainder of 2022 $ 343 2023 686 2024 686 2025 114 Thereafter — Total $ 1,829 |
Future Minimum Rental Commitments Under Long-Term Leases | At December 31, 2021, total future minimum rental commitments under long-term leases, net of sublease income, with an initial term of more than one year were estimated as follows (in thousands): 2022 $ 26,387 2023 30,450 2024 30,630 2025 29,459 2026 30,350 Thereafter 206,587 Total $ 353,863 |
Common Stock (Tables)
Common Stock (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Option Activity | The following table summarizes option activity under the 2021 Plan and the 2014 Plan: Number of Weighted Weighted Aggregate (in thousands) Outstanding - December 31, 2021 7,555,966 $12.55 8.15 $3,668 Options granted — — Options exercised (77,093) $3.94 Options cancelled (967,266) $10.28 Outstanding - June 30, 2022 6,511,607 $12.99 7.80 $13 Unvested - June 30, 2022 3,448,905 $15.15 8.87 — Exercisable - June 30, 2022 3,062,702 $10.57 6.60 $13 |
Valuation Assumptions for Fair Value of Stock Options | The fair value of employee stock options was estimated using the following assumptions, in periods for which options were granted: Three Months Ended June 30, Six Months Ended June 30, 2021 2021 Expected dividend yield — % — % Risk-free interest rate 1.04% - 1.09% 0.77% - 1.09% Expected term (in years) 6.08 6.08 Expected volatility 73.03% - 74.27% 73.03% - 74.67% |
Restricted Stock Units Activity | The following table summarizes RSU activity (in thousands, except share and per share amounts and term): Shares Weighted Average Non-vested Restricted Stock Units as of December 31, 2021 2,475,983 $13.47 Granted 6,760,327 $3.03 Vested (428,912) $6.65 Forfeited (646,311) $8.18 Non-vested Restricted Stock Units as of June 30, 2022 8,161,087 $5.60 |
Compensation Expense | Compensation expense related to stock-based awards was included in the following categories in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Loss in accordance with the accounting guidance for share-based payments for the three and six months ended June 30, 2022 and 2021 (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Cost of service revenue $ 661 $ 944 $ 1,462 $ 1,368 Cost of automation revenue 24 — 24 — Research and development 3,248 2,537 5,595 3,290 Sales and marketing 473 366 911 561 General and administrative 4,236 3,118 8,041 3,999 Total stock-based compensation $ 8,642 $ 6,965 $ 16,033 $ 9,218 Compensation expense by stock-based award was as follows for the three and six months ended June 30, 2022 and 2021 (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 Stock options with service based vesting conditions $ 3,805 $ 3,356 $ 7,797 $ 5,526 Stock options with market based vesting conditions 685 2,414 1,362 2,414 RSUs with service based vesting conditions 4,010 585 6,518 585 Non-vested stock — 83 — 166 ESPP 142 527 356 527 Total stock-based compensation $ 8,642 $ 6,965 $ 16,033 $ 9,218 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Net Loss Per Share | The following table presents the calculation of basic and diluted net loss per share (in thousands, except share and per share data) applicable to common stockholders for the three and six months ended June 30, 2022 and 2021: Three Months Ended Six Months Ended 2022 2021 2022 2021 Numerator: Net loss, basic $ (116,468) $ (100,866) $ (188,584) $ (185,451) Less: Gain on change in fair value of warrant liabilities — — — 1,849 Net loss, diluted $ (116,468) $ (100,866) $ (188,584) $ (187,300) Denominator: Weighted average shares used in calculating net loss per share, basic 103,482,907 77,671,643 103,297,070 45,512,654 Effect of dilutive securities: Warrants to purchase Series C convertible preferred stock — — — 214,499 Weighted average shares used in calculating net loss per share, diluted 103,482,907 77,671,643 103,297,070 45,727,153 Net loss per share, basic $ (1.13) $ (1.30) $ (1.83) $ (4.07) Net loss per share, diluted $ (1.13) $ (1.30) $ (1.83) $ (4.10) |
Antidilutive Securities Excluded from Computation of Diluted Net Loss Per Share | The following potentially dilutive shares as of the periods ended June 30, 2022, and 2021, were excluded from the calculation of diluted net loss per share applicable to common stockholders because their effect would have been anti-dilutive for the periods presented: June 30, 2022 June 30, 2021 Options to purchase common stock 6,511,607 6,349,331 Restricted stock units 8,161,087 203,433 Non-vested stock — 33,620 Total 14,672,694 6,586,384 |
Revenue, Credit Concentration_2
Revenue, Credit Concentrations and Geographic Information (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Changes in the Balances of Contract Liabilities | The following table represents changes in the balances of our contract liabilities during the periods ended June 30, 2022, and 2021 (in thousands): December 31, 2021 Additions Adjustments Deletions June 30, 2022 Contract liabilities: Deferred revenue $ 8,195 $ 1,260 $ — $ (3,586) $ 5,869 December 31, 2020 Additions Adjustments Deletions June 30, 2021 Contract liabilities: Deferred revenue $ 3,014 $ 7,057 $ 6,819 $ (5,764) $ 11,126 |
Revenue, Remaining Performance Obligation | Remaining performance obligations consist of the following (in thousands): Current Noncurrent Total As of June 30, 2022 $ 5,108 $ 4,099 $ 9,207 |
Concentration of Risk, by Risk Factor | Customers representing 10% or greater of revenue were as follows for the three and six months ended June 30, 2022 and 2021: Three Months Ended Six Months Ended 2022 2021 2022 2021 Customer A — % * 23 % * Customer B 25 % 17 % 26 % 22 % Customer C 25 % 10 % 17 % 12 % Customer E — % 40 % — % 31 % Customer H 20 % * 13 % * Customer I 18 % — % * — % —–—–—–—–—–—– * Less than 10% Customers representing 10% or greater of billed accounts receivable were as follows as of June 30, 2022 and December 31, 2021: June 30, December 31, Customer C 43 % — % Customer F * 68 % Customer G — % 29 % Customer I 50 % — % —–—–—–—–—–—– |
Revenue, Geographic Region | The Company's revenues by geographic region are presented in the table below for the three and six months ended June 30, 2022 and 2021 (in thousands): Three Months Ended Six Months Ended 2022 2021 2022 2021 United States of America $ 1,937 $ 1,782 $ 3,806 $ 3,014 Asia 692 1,308 1,944 2,729 Europe 5 2,764 1,675 3,846 Total revenue $ 2,634 $ 5,854 $ 7,425 $ 9,589 |
Nature of Operations (Details)
Nature of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | [1] | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||
Cumulative net losses | $ 1,324,109 | $ 1,324,109 | $ 1,135,525 | |||||
Net loss | 116,468 | $ 72,116 | $ 100,866 | $ 84,585 | 188,584 | $ 185,451 | ||
Net cash used in operating activities | 99,575 | 167,104 | ||||||
Unrestricted cash and cash equivalents | $ 213,558 | $ 577,731 | $ 213,558 | $ 577,731 | $ 386,105 | |||
[1]The balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Number of operating segments | segment | 1 | ||
Number of reportable segments | segment | 1 | ||
Employer payroll tax payments deferred, CARES Act | $ 1,800 | $ 3,700 | |
Total assets | 470,968 | 522,396 | [1] |
Total liabilities | $ 234,345 | $ 113,910 | [1] |
Accounting Standards Update [Extensible Enumeration] | Accounting Standards Update 2016-02 [Member] | ||
Cumulative Effect, Period of Adoption, Adjustment | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Total assets | $ 152,300 | ||
Total liabilities | $ 189,900 | ||
[1]The balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. |
Business Combination (Details)
Business Combination (Details) $ in Thousands | May 16, 2021 USD ($) installment shares | Jun. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) | [1] |
Business Acquisition [Line Items] | ||||
Goodwill | $ 0 | $ 40,645 | ||
Lodo Therapeutics Corporation | ||||
Business Acquisition [Line Items] | ||||
Percentage of business acquired | 100% | |||
Purchase price for business combination | $ 25,300 | |||
Goodwill | 29,000 | |||
Business combination related costs | $ 900 | |||
Lodo Therapeutics Corporation | Common Stock | ||||
Business Acquisition [Line Items] | ||||
Non-cash consideration transferred for business combination (in shares) | shares | 774,402 | |||
Lodo Therapeutics Corporation | Restricted stock units | ||||
Business Acquisition [Line Items] | ||||
Number of award vesting installments | installment | 3 | |||
Award vesting period | 2 years | |||
Lodo Therapeutics Corporation | Developed Technology Rights | ||||
Business Acquisition [Line Items] | ||||
Intangible assets acquired | $ 5,400 | |||
[1]The balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. |
Restructuring - Narrative (Deta
Restructuring - Narrative (Details) - USD ($) | 10 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Restructuring and Related Activities [Abstract] | ||
Expected additional restructuring costs to be incurred | $ 0 | |
Expected total pre-tax restructuring charges | $ 28,493,000 | |
Expected cash outlays from total pre-tax restructuring charges | 16,700,000 | |
Cash restructuring payments | 15,300,000 | |
Total amount incurred since inception through current period date | $ 28,493,000 |
Restructuring - Restructuring C
Restructuring - Restructuring Costs (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Restructuring Cost and Reserve [Line Items] | |
Total amount incurred since inception through current period date | $ 28,493 |
Estimated restructuring costs expected to be incurred | 28,493 |
Termination benefits | |
Restructuring Cost and Reserve [Line Items] | |
Total amount incurred since inception through current period date | 8,580 |
Estimated restructuring costs expected to be incurred | 8,580 |
Impairment of long-lived assets | |
Restructuring Cost and Reserve [Line Items] | |
Total amount incurred since inception through current period date | 11,815 |
Estimated restructuring costs expected to be incurred | 11,815 |
Contract terminations | |
Restructuring Cost and Reserve [Line Items] | |
Total amount incurred since inception through current period date | 3,507 |
Estimated restructuring costs expected to be incurred | 3,507 |
Other | |
Restructuring Cost and Reserve [Line Items] | |
Total amount incurred since inception through current period date | 4,591 |
Estimated restructuring costs expected to be incurred | $ 4,591 |
Restructuring - Reconciliation
Restructuring - Reconciliation of Restructuring Liability (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | $ 2,398 |
Charges | 0 |
Adjustments | (315) |
Cash Payments, net | (754) |
Ending balance | 1,329 |
Termination benefits | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 948 |
Charges | 0 |
Adjustments | (73) |
Cash Payments, net | (846) |
Ending balance | 29 |
Contract Terminations | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 1,450 |
Charges | 0 |
Adjustments | (242) |
Cash Payments, net | 92 |
Ending balance | 1,300 |
Other | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 0 |
Charges | 0 |
Adjustments | 0 |
Cash Payments, net | 0 |
Ending balance | $ 0 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill | $ 0 | $ 40,645 | [1] |
[1]The balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | |||
Cost | $ 13,700 | $ 13,700 | |
Accumulated Amortization | (6,320) | (5,171) | |
Intangible Assets, Net | 7,380 | 8,529 | [1] |
Developed Technology Rights | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 12,300 | 12,300 | |
Accumulated Amortization | (5,104) | (4,110) | |
Intangible Assets, Net | 7,196 | 8,190 | |
Customer relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 1,400 | 1,400 | |
Accumulated Amortization | (1,216) | (1,061) | |
Intangible Assets, Net | $ 184 | $ 339 | |
[1]The balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Goodwill impairment charge | $ 40,645 | $ 0 | $ 40,645 | $ 0 |
Amortization expense | $ 500 | $ 500 | $ 1,100 | $ 800 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Future Amortization of Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | [1] |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Remainder of 2022 | $ 1,099 | ||
2023 | 2,067 | ||
2024 | 1,271 | ||
2025 | 1,271 | ||
2026 | 1,271 | ||
Thereafter | 401 | ||
Intangible Assets, Net | $ 7,380 | $ 8,529 | |
[1]The balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. |
Fair Value Measurements of Fi_3
Fair Value Measurements of Financial Instruments - Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Recurring - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Financial Assets | ||
Cash equivalents | $ 1,669 | $ 1,667 |
Total financial assets | 1,669 | 1,667 |
Level 1 | ||
Financial Assets | ||
Cash equivalents | 1,669 | 1,667 |
Total financial assets | 1,669 | 1,667 |
Level 2 | ||
Financial Assets | ||
Cash equivalents | 0 | 0 |
Total financial assets | 0 | 0 |
Level 3 | ||
Financial Assets | ||
Cash equivalents | 0 | 0 |
Total financial assets | $ 0 | $ 0 |
Balance Sheet Components - Prop
Balance Sheet Components - Property and Equipment (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | |||
Less accumulated depreciation and amortization | $ (82,784) | $ (78,132) | |
Total property and equipment, net | 70,590 | 53,799 | [1] |
Depreciable property, plant and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 109,540 | 111,989 | |
Total property and equipment, net | 26,756 | 33,857 | |
Machinery and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 76,195 | 74,548 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 27,379 | 31,488 | |
Furniture and office equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 3,191 | 3,189 | |
Computers and software | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 2,775 | 2,764 | |
Construction in progress | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 43,834 | $ 19,942 | |
[1]The balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. |
Balance Sheet Components - Narr
Balance Sheet Components - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Depreciation | $ 4.2 | $ 4.4 | $ 9.1 | $ 8.5 |
Balance Sheet Components - Accr
Balance Sheet Components - Accrued and Other Current Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Accrued compensation and compensation-related costs | $ 9,089 | $ 6,027 | |
Other accrued liabilities | 13,317 | 7,045 | |
Accrued restructuring costs | 1,329 | 2,398 | |
Accrued legal service fees | 3,206 | 1,940 | |
Accrued tax liabilities | 68 | 86 | |
Total accrued and other current liabilities | $ 27,009 | $ 17,496 | [1] |
[1]The balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. |
Balance Sheet Components - Inve
Balance Sheet Components - Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | |
Inventory [Line Items] | |||
Inventories | $ 6,107 | $ 6,035 | [1] |
Consumables | |||
Inventory [Line Items] | |||
Inventories | 5,480 | 6,035 | |
Automation - Raw materials | |||
Inventory [Line Items] | |||
Inventories | $ 627 | $ 0 | |
[1]The balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. |
Term Loan - Narrative (Details)
Term Loan - Narrative (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Senior Secured Delayed Draw Term Loan Facility | Secured Debt | ||
Debt Instrument [Line Items] | ||
Debt outstanding | $ 0 | $ 43,953,000 |
Term Loan - Long-Term Debt, Net
Term Loan - Long-Term Debt, Net (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||
Less current portion | $ 0 | $ 43,953,000 | [1] |
Long-term debt, net | $ 0 | ||
Senior Secured Delayed Draw Term Loan Facility | Secured Debt | |||
Debt Instrument [Line Items] | |||
Interest rate | 11.50% | ||
Senior secured delayed draw term loan facility bearing interest equal to 11.5% as of December 31, 2021 | $ 50,000,000 | ||
Unamortized discount and offering costs | (8,310,000) | ||
Accrued end-of-term payment | 2,263,000 | ||
Senior secured delayed draw term loan facility, net | $ 0 | $ 43,953,000 | |
[1]The balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. |
Term Loan - Interest Expense (D
Term Loan - Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Debt Disclosure [Abstract] | ||||
Coupon interest | $ 1,453 | $ 2,471 | $ 2,891 | $ 4,914 |
Amortization of debt discount and offering costs | 4,669 | 296 | 8,310 | 580 |
Accretion of end-of-term payment | 3,256 | 0 | 6,222 | 0 |
Total interest expense on term loan | $ 9,378 | $ 2,767 | $ 17,423 | $ 5,494 |
Leases - Components of Lease (D
Leases - Components of Lease (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 | Jun. 30, 2022 | |
Leases [Abstract] | ||
Operating lease cost | $ 8,628 | $ 17,437 |
Operating variable lease cost | 1,687 | 3,306 |
Operating sublease income | (172) | (344) |
Total lease costs | $ 10,143 | $ 20,399 |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Feb. 28, 2021 USD ($) ft² renewal_option | Jul. 31, 2019 ft² renewal_option | Jun. 30, 2021 USD ($) | Jun. 30, 2021 USD ($) | Oct. 31, 2019 ft² | |
Lessee, Lease, Description [Line Items] | |||||
Rent expense under operating leases | $ | $ 9.5 | $ 15.8 | |||
Warehouse and Office Space | |||||
Lessee, Lease, Description [Line Items] | |||||
Area leased (in square feet) | 58,000 | ||||
Additional area leased (in square feet) | 10,000 | ||||
Annual rent escalation on lease | 3% | ||||
Number of renewal options on lease | renewal_option | 2 | ||||
Renewal term on lease | 5 years | ||||
Laboratory and Office Space | |||||
Lessee, Lease, Description [Line Items] | |||||
Area subleased (in square feet) | 76,000 | ||||
Annual rent escalation on sublease | 3% | ||||
Number of renewal options on sublease | renewal_option | 0 | ||||
Building | |||||
Lessee, Lease, Description [Line Items] | |||||
Annual rent escalation on lease | 3% | ||||
Number of renewal options on lease | renewal_option | 2 | ||||
Renewal term on lease | 5 years | ||||
Area of lease not yet commenced (in square feet) | 303,000 | ||||
Free or reduced rent period on lease | 1 year 6 months | ||||
Maximum tenant improvement allowances | $ | $ 46.9 |
Leases - Other Information (Det
Leases - Other Information (Details) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 USD ($) | Jun. 30, 2022 USD ($) | |
Leases [Abstract] | ||
Cash paid for amounts included in operating lease liabilities | $ 6,872 | $ 11,219 |
Weighted-average remaining operating lease term (in years) | 10 years 5 months 4 days | 10 years 5 months 4 days |
Weighted-average incremental borrowing rate | 12.60% | 12.60% |
Leases - Maturities of Operatin
Leases - Maturities of Operating Lease Liabilities (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Leases [Abstract] | |
Remainder of 2022 | $ 15,717 |
2023 | 30,256 |
2024 | 30,661 |
2025 | 30,253 |
2026 | 31,091 |
Thereafter | 208,242 |
Total | 346,220 |
Less: Interest | (160,139) |
Present value of operating lease liabilities | $ 186,081 |
Leases - Maturities of Operat_2
Leases - Maturities of Operating Sublease Payments (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Leases [Abstract] | |
Remainder of 2022 | $ 343 |
2023 | 686 |
2024 | 686 |
2025 | 114 |
Thereafter | 0 |
Total | $ 1,829 |
Leases - Future Minimum Rental
Leases - Future Minimum Rental Commitments Under Long-Term Leases (Details) $ in Thousands | Dec. 31, 2021 USD ($) |
Leases [Abstract] | |
2022 | $ 26,387 |
2023 | 30,450 |
2024 | 30,630 |
2025 | 29,459 |
2026 | 30,350 |
Thereafter | 206,587 |
Total | $ 353,863 |
Common Stock - Narrative (Detai
Common Stock - Narrative (Details) $ / shares in Units, $ in Millions | 6 Months Ended | |
Jun. 30, 2022 USD ($) stock_based_compensation_plan shares | Jun. 30, 2021 USD ($) $ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of stock-based compensation plans | stock_based_compensation_plan | 3 | |
Unrecognized stock-based compensation expense, options | $ | $ 29.6 | |
Stock options with service based vesting conditions | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized stock-based compensation expense, weighted average period of recognition | 2 years 4 months 13 days | |
Restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized stock-based compensation expense, weighted average period of recognition | 1 year 11 months 4 days | |
Total intrinsic value of non-vested stock that vested | $ | $ 0.7 | |
Unrecognized stock-based compensation expense, excluding option | $ | $ 38.6 | |
2021 Incentive Award Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares available for grant | 5,866,372 | |
Number of additional shares available for grant | 5,152,264 | |
2021 Incentive Award Plan | Market Condition Awards | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized stock-based compensation expense, options | $ | $ 5.4 | |
Unrecognized stock-based compensation expense, weighted average period of recognition | 2 years 10 days | |
Unvested, at end period (in shares) | 458,333 | |
2021 Employee Stock Purchase Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares available for grant | 2,758,864 | |
Number of additional shares available for grant | 1,030,452 | |
2021 Plan and 2014 Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Options granted (in shares) | 0 | |
Weighted average grant date fair value of options granted (in dollars per share) | $ / shares | $ 18.33 | |
Total intrinsic value of options exercised | $ | $ 0.1 | $ 25.8 |
Unvested, at end period (in shares) | 3,448,905 |
Common Stock - Option Activity
Common Stock - Option Activity (Details) - 2021 Plan and 2014 Plan - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Number of Options | ||
Beginning balance, outstanding (in shares) | 7,555,966 | |
Options granted (in shares) | 0 | |
Options exercised (in shares) | (77,093) | |
Options cancelled (in shares) | (967,266) | |
Ending balance, outstanding (in shares) | 6,511,607 | 7,555,966 |
Unvested, at end period (in shares) | 3,448,905 | |
Exercisable, at end of period (in shares) | 3,062,702 | |
Weighted Average Exercise Price | ||
Beginning balance, outstanding (in dollars per share) | $ 12.55 | |
Options granted (in dollars per share) | 0 | |
Options exercised (in dollars per share) | 3.94 | |
Options cancelled (in dollars per share) | 10.28 | |
Ending balance, outstanding (in dollars per share) | 12.99 | $ 12.55 |
Weighted average exercise price, unvested at period end (in dollars per share) | 15.15 | |
Weighted average exercise price, exercisable at period end (in dollars per share) | $ 10.57 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Weighted average remaining contractual life, outstanding | 7 years 9 months 18 days | 8 years 1 month 24 days |
Weighted average remaining contractual life, unvested at period end | 8 years 10 months 13 days | |
Weighted average remaining contractual life, exercisable at period end | 6 years 7 months 6 days | |
Aggregate intrinsic value, outstanding | $ 13 | $ 3,668 |
Aggregate intrinsic value, unvested at period end | 0 | |
Aggregate intrinsic value, exercisable at period end | $ 13 |
Common Stock - Valuation Assump
Common Stock - Valuation Assumptions for Fair Value of Stock Options (Details) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk free interest rate, minimum | 0.77% | |
Risk free interest rate, maximum | 1.09% | |
Expected volatility, minimum | 73.03% | |
Expected volatility, maximum | 74.67% | |
Stock options with service based vesting conditions | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected dividend yield | 0% | 0% |
Risk free interest rate, minimum | 1.04% | |
Risk free interest rate, maximum | 1.09% | |
Expected term (in years) | 6 years 29 days | 6 years 29 days |
Expected volatility, minimum | 73.03% | |
Expected volatility, maximum | 74.27% |
Common Stock - Restricted Stock
Common Stock - Restricted Stock Units Activity (Details) - Restricted stock units | 6 Months Ended |
Jun. 30, 2022 $ / shares shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward] | |
Beginning balance, Non-vested Restricted Stock Units (in shares) | shares | 2,475,983 |
Granted (in shares) | shares | 6,760,327 |
Vested (in shares) | shares | (428,912) |
Forfeited (in shares) | shares | (646,311) |
Ending balance, Non-vested Restricted Stock Units (in shares) | shares | 8,161,087 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Beginning balance (in dollars per share) | $ / shares | $ 13.47 |
Granted (in dollars per share) | $ / shares | 3.03 |
Vested (in dollars per share) | $ / shares | 6.65 |
Forfeited (in dollars per share) | $ / shares | 8.18 |
Ending balance (in dollars per share) | $ / shares | $ 5.60 |
Common Stock - Compensation Exp
Common Stock - Compensation Expense Related to Stock-Based Awards Included in Categories of Statement of Operations and Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation | $ 8,642 | $ 6,965 | $ 16,033 | $ 9,218 |
Cost of service revenue | Automation revenue | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation | 24 | 0 | 24 | 0 |
Cost of service revenue | Service revenue | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation | 661 | 944 | 1,462 | 1,368 |
Research and development | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation | 3,248 | 2,537 | 5,595 | 3,290 |
Sales and marketing | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation | 473 | 366 | 911 | 561 |
General and administrative | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation | $ 4,236 | $ 3,118 | $ 8,041 | $ 3,999 |
Common Stock - Compensation E_2
Common Stock - Compensation Expense by Stock-Based Award (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation | $ 8,642 | $ 6,965 | $ 16,033 | $ 9,218 |
Stock options with service based vesting conditions | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation | 3,805 | 3,356 | 7,797 | 5,526 |
Stock options with market based vesting conditions | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation | 685 | 2,414 | 1,362 | 2,414 |
RSUs with service based vesting conditions | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation | 4,010 | 585 | 6,518 | 585 |
Non-vested stock | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation | 0 | 83 | 0 | 166 |
ESPP | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation | $ 142 | $ 527 | $ 356 | $ 527 |
Net Loss Per Share - Basic and
Net Loss Per Share - Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Numerator: | ||||
Net loss, basic | $ (116,468) | $ (100,866) | $ (188,584) | $ (185,451) |
Less: Gain on change in fair value of warrant liabilities | 0 | 0 | 0 | 1,849 |
Net loss, diluted | $ (116,468) | $ (100,866) | $ (188,584) | $ (187,300) |
Denominator: | ||||
Weighted average shares used in calculating net loss per share, basic (in shares) | 103,482,907 | 77,671,643 | 103,297,070 | 45,512,654 |
Effect of dilutive securities: | ||||
Warrants to purchase Series C convertible preferred stock (in shares) | 0 | 0 | 0 | 214,499 |
Weighted average shares used in calculating net loss per share, diluted (in shares) | 103,482,907 | 77,671,643 | 103,297,070 | 45,727,153 |
Net loss per share, basic (in dollars per share) | $ (1.13) | $ (1.30) | $ (1.83) | $ (4.07) |
Net loss per share, diluted (in dollars per share) | $ (1.13) | $ (1.30) | $ (1.83) | $ (4.10) |
Net Loss Per Share - Antidiluti
Net Loss Per Share - Antidilutive Securities Excluded from Computation of Diluted Net Loss Per Share (Details) - shares | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 14,672,694 | 6,586,384 |
Options to purchase common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 6,511,607 | 6,349,331 |
Restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 8,161,087 | 203,433 |
Non-vested stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 0 | 33,620 |
Revenue, Credit Concentration_3
Revenue, Credit Concentrations and Geographic Information - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Oct. 10, 2021 | |
Disaggregation of Revenue [Line Items] | |||||
Maximum potential grant revenue to be awarded | $ 2,900,000 | ||||
Deferred revenue | $ 2,300,000 | $ 2,300,000 | |||
Revenues | 2,634,000 | $ 5,854,000 | 7,425,000 | $ 9,589,000 | |
Research And Development Revenue, Performance Bonuses | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues from contract with customer | 0 | 300,000 | 0 | 300,000 | |
Research And Development Service Revenue, Customer Acceptance Clauses | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues from contract with customer | 0 | 1,500,000 | 500,000 | 2,300,000 | |
Refunds | 0 | ||||
Automation revenue | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues from contract with customer | 500,000 | 500,000 | |||
Refunds | 0 | ||||
Revenues | 480,000 | 0 | 480,000 | 0 | |
Grant revenue | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | $ 217,000 | $ 0 | $ 454,000 | $ 0 |
Revenue, Credit Concentration_4
Revenue, Credit Concentrations and Geographic Information - Changes in the Balances of Contract Liabilities (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Contract liabilities: | ||
Beginning balance | $ 8,195 | $ 3,014 |
Additions | 1,260 | 7,057 |
Adjustments | 0 | 6,819 |
Deletions | (3,586) | (5,764) |
Ending balance | $ 5,869 | $ 11,126 |
Revenue, Credit Concentration_5
Revenue, Credit Concentrations and Geographic Information - Revenue, Remaining Performance Obligation (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, amount | $ 9,207 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, amount | $ 5,108 |
Revenue, remaining performance obligation, amount, period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, amount | $ 4,099 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-01 | Minimum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, amount, period | 1 year 1 month 6 days |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-01 | Maximum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, amount, period | 3 years |
Revenue, Credit Concentration_6
Revenue, Credit Concentrations and Geographic Information - Concentration of Risk, by Risk Factor (Details) - Customer Concentration Risk | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Revenue Benchmark | Customer A | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 0% | 23% | |||
Revenue Benchmark | Customer B | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 25% | 17% | 26% | 22% | |
Revenue Benchmark | Customer C | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 25% | 10% | 17% | 12% | |
Revenue Benchmark | Customer E | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 0% | 40% | 0% | 31% | |
Revenue Benchmark | Customer H | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 20% | 13% | |||
Revenue Benchmark | Customer I | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 18% | 0% | 0% | ||
Accounts Receivable | Customer C | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 43% | 0% | |||
Accounts Receivable | Customer F | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 68% | ||||
Accounts Receivable | Customer G | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 0% | 29% | |||
Accounts Receivable | Customer I | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 50% | 0% |
Revenue, Credit Concentration_7
Revenue, Credit Concentrations and Geographic Information - Revenue, Geographic Region (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 2,634 | $ 5,854 | $ 7,425 | $ 9,589 |
United States of America | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,937 | 1,782 | 3,806 | 3,014 |
Asia | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 692 | 1,308 | 1,944 | 2,729 |
Europe | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 5 | $ 2,764 | $ 1,675 | $ 3,846 |
Subsequent Events (Details)
Subsequent Events (Details) | Jul. 26, 2022 USD ($) employee | Jul. 24, 2022 USD ($) extension $ / shares shares | Jun. 30, 2022 USD ($) $ / shares | Dec. 31, 2021 $ / shares |
Subsequent Event [Line Items] | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | ||
Estimated restructuring costs expected to be incurred | $ 28,493,000 | |||
Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Number of employees terminated | employee | 80 | |||
Estimated restructuring costs expected to be incurred | $ 4,000,000 | |||
Subsequent Event | Ginkgo Bioworks Holdings, Inc and Pepper Merger Subsidiary Merger | ||||
Subsequent Event [Line Items] | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | |||
Business acquisition, common stock, conversion ratio | shares | 0.9179 | |||
Common stock, par value of acquirer (in dollars per share) | $ / shares | $ 0.0001 | |||
Aggregate of additional costs and liabilities | $ 25,000,000 | |||
Number of extensions merger agreement is subject to | extension | 2 | |||
Length of each extension period | 3 months | |||
Length of total extension | 12 months | |||
Termination fee | $ 10,000,000 | |||
Termination fee, period subject to | 12 months |