Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2022 | Jul. 29, 2022 | |
Entity Listings [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2022 | |
Entity File Number | 001-39292 | |
Entity Registrant Name | Butterfly Network, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 84-4618156 | |
Entity Address, Address Line One | 530 Old Whitfield Street | |
Entity Address, City or Town | Guilford | |
Entity Address, State or Province | CT | |
Entity Address, Postal Zip Code | 06437 | |
City Area Code | 203 | |
Local Phone Number | 689-5650 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001804176 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Class A Common Stock | ||
Entity Listings [Line Items] | ||
Title of 12(b) Security | Class A common stock, par value $0.0001 per share | |
Trading Symbol | BFLY | |
Security Exchange Name | NYSE | |
Entity Common Stock, Shares Outstanding | 173,115,829 | |
Warrants to purchase one share of Class A common stock, each at an exercise price of $11.50 per share | ||
Entity Listings [Line Items] | ||
Title of 12(b) Security | Warrants to purchase one share of Class A common stock, each at an exercise price of $11.50 per share | |
Trading Symbol | BFLY WS | |
Security Exchange Name | NYSE | |
Class B Common Stock | ||
Entity Listings [Line Items] | ||
Entity Common Stock, Shares Outstanding | 26,426,937 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 310,802 | $ 422,841 |
Accounts receivable, net | 12,691 | 11,936 |
Inventories | 65,587 | 36,243 |
Current portion of vendor advances | 16,784 | 27,500 |
Prepaid expenses and other current assets | 19,647 | 13,384 |
Total current assets | 425,511 | 511,904 |
Property and equipment, net | 28,577 | 14,703 |
Non-current portion of vendor advances | 12,168 | 12,782 |
Operating lease assets | 22,981 | 24,083 |
Other non-current assets | 7,400 | 8,493 |
Total assets | 496,637 | 571,965 |
Current liabilities: | ||
Accounts payable | 3,518 | 5,798 |
Deferred revenue, current | 15,572 | 13,071 |
Accrued purchase commitments, current | 18,119 | 5,329 |
Accrued expenses and other current liabilities | 24,998 | 25,631 |
Total current liabilities | 62,207 | 49,829 |
Deferred revenue, non-current | 6,954 | 5,476 |
Warrant liabilities | 8,261 | 26,229 |
Accrued purchase commitments, non-current | 1,410 | 14,200 |
Operating lease liabilities | 30,422 | 27,690 |
Other non-current liabilities | 694 | 850 |
Total liabilities | 109,948 | 124,274 |
Commitments and contingencies (Note 14) | ||
Stockholders' equity: | ||
Additional paid-in capital | 894,162 | 874,886 |
Accumulated deficit | (507,493) | (427,215) |
Total stockholders' equity | 386,689 | 447,691 |
Total liabilities and stockholders' equity | 496,637 | 571,965 |
Class A Common Stock | ||
Stockholders' equity: | ||
Common stock | 17 | 17 |
Class B Common Stock | ||
Stockholders' equity: | ||
Common stock | $ 3 | $ 3 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2022 | Dec. 31, 2021 |
Class A Common Stock | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 600,000,000 | 600,000,000 |
Common stock shares issued | 172,816,532 | 171,613,049 |
Common stock, shares outstanding (in shares) | 172,816,532 | 171,613,049 |
Class B Common Stock | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 27,000,000 | 27,000,000 |
Common stock shares issued | 26,426,937 | 26,426,937 |
Common stock, shares outstanding (in shares) | 26,426,937 | 26,426,937 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenue: | ||||
Total revenue | $ 19,215 | $ 16,513 | $ 34,789 | $ 28,958 |
Cost of revenue: | ||||
Total cost of revenue | 8,643 | 8,293 | 15,874 | 14,320 |
Gross profit | 10,572 | 8,220 | 18,915 | 14,638 |
Operating expenses: | ||||
Research and development | 23,220 | 17,088 | 46,843 | 32,804 |
Sales and marketing | 16,438 | 10,540 | 31,640 | 20,347 |
General and administrative | 19,369 | 17,279 | 38,419 | 51,920 |
Total operating expenses | 59,027 | 44,907 | 116,902 | 105,071 |
Loss from operations | (48,455) | (36,687) | (97,987) | (90,433) |
Interest income | 260 | 607 | 270 | 846 |
Interest expense | (7) | (645) | ||
Change in fair value of warrant liabilities | 12,805 | 33,458 | 17,968 | 87,570 |
Other income (expense), net | (388) | (262) | (488) | (895) |
Loss before provision for income taxes | (35,778) | (2,891) | (80,237) | (3,557) |
Provision for income taxes | 23 | 51 | 41 | 75 |
Net loss and comprehensive loss | $ (35,801) | $ (2,942) | $ (80,278) | $ (3,632) |
Net loss per common share - basic | $ (0.18) | $ (0.02) | $ (0.40) | $ (0.02) |
Net loss per common share - diluted | $ (0.18) | $ (0.02) | $ (0.40) | $ (0.02) |
Weighted-average common shares outstanding - basic | 199,399,356 | 192,180,141 | 199,200,909 | 149,286,700 |
Weighted-average common shares outstanding - diluted | 199,399,356 | 192,180,141 | 199,200,909 | 149,286,700 |
Product | ||||
Revenue: | ||||
Total revenue | $ 13,429 | $ 13,012 | $ 24,443 | $ 22,608 |
Cost of revenue: | ||||
Total cost of revenue | 6,799 | 7,858 | 12,947 | 13,506 |
Subscription | ||||
Revenue: | ||||
Total revenue | 5,786 | 3,501 | 10,346 | 6,350 |
Cost of revenue: | ||||
Total cost of revenue | $ 1,844 | $ 435 | $ 2,927 | $ 814 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Convertible Preferred Stock | Common Stock Class A Common Stock | Common Stock Class B Common Stock | Additional Paid-In Capital | Accumulated Deficit | Class A Common Stock | Class B Common Stock | Total |
Convertible Preferred Stock, Balance at beginning of the period at Dec. 31, 2020 | $ 360,937 | |||||||
Convertible Preferred Stock, Balance at beginning of the period (in shares) at Dec. 31, 2020 | 107,197,118 | |||||||
Increase (Decrease) in Convertible Preferred Stock | ||||||||
Conversion of convertible preferred stock | $ (360,937) | |||||||
Conversion of convertible preferred stock (in shares) | (107,197,118) | |||||||
Balance at beginning of the period at Dec. 31, 2020 | $ 1 | $ 32,874 | $ (394,806) | $ (361,931) | ||||
Balance at beginning of the period (in shares) at Dec. 31, 2020 | 6,593,291 | |||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Net loss | (3,632) | (3,632) | ||||||
Common stock issued upon exercise of stock options | $ 1 | 11,688 | 11,689 | |||||
Common stock issued upon exercise of stock options (in shares) | 5,302,472 | |||||||
Common stock issued upon vesting of restricted stock units (in shares) | 467,234 | |||||||
Conversion of convertible preferred stock | $ 8 | $ 3 | 360,926 | 360,937 | ||||
Conversion of convertible preferred stock (in shares) | 80,770,178 | 26,426,937 | ||||||
Conversion of convertible debt | $ 1 | 49,916 | 49,917 | |||||
Conversion of convertible debt (in shares) | 5,115,140 | |||||||
Net equity infusion from the Business Combination | $ 6 | 361,281 | 361,287 | |||||
Net equity infusion from the Business Combination (in shares) | 69,228,811 | |||||||
Stock-based compensation expense | 28,085 | 28,085 | ||||||
Balance at end of the period at Jun. 30, 2021 | $ 17 | $ 3 | 844,770 | (398,438) | 446,352 | |||
Balance at end of the period (in shares) at Jun. 30, 2021 | 167,477,126 | 26,426,937 | ||||||
Balance at beginning of the period at Mar. 31, 2021 | $ 16 | $ 3 | 831,640 | (395,496) | 436,163 | |||
Balance at beginning of the period (in shares) at Mar. 31, 2021 | 164,862,470 | 26,426,937 | ||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Net loss | (2,942) | (2,942) | ||||||
Common stock issued upon exercise of stock options | $ 1 | 5,375 | 5,376 | |||||
Common stock issued upon exercise of stock options (in shares) | 2,147,422 | |||||||
Common stock issued upon vesting of restricted stock units (in shares) | 467,234 | |||||||
Stock-based compensation expense | 7,755 | 7,755 | ||||||
Balance at end of the period at Jun. 30, 2021 | $ 17 | $ 3 | 844,770 | (398,438) | 446,352 | |||
Balance at end of the period (in shares) at Jun. 30, 2021 | 167,477,126 | 26,426,937 | ||||||
Balance at beginning of the period at Dec. 31, 2021 | $ 17 | $ 3 | 874,886 | (427,215) | 447,691 | |||
Balance at beginning of the period (in shares) at Dec. 31, 2021 | 171,613,049 | 26,426,937 | 171,613,049 | 26,426,937 | ||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Net loss | (80,278) | (80,278) | ||||||
Common stock issued upon exercise of stock options | 810 | 810 | ||||||
Common stock issued upon exercise of stock options (in shares) | 343,667 | |||||||
Common stock issued upon vesting of restricted stock units | (106) | (106) | ||||||
Common stock issued upon vesting of restricted stock units (in shares) | 859,816 | |||||||
Stock-based compensation expense | 18,572 | 18,572 | ||||||
Balance at end of the period at Jun. 30, 2022 | $ 17 | $ 3 | 894,162 | (507,493) | 386,689 | |||
Balance at end of the period (in shares) at Jun. 30, 2022 | 172,816,532 | 26,426,937 | 172,816,532 | 26,426,937 | ||||
Balance at beginning of the period at Mar. 31, 2022 | $ 17 | $ 3 | 884,336 | (471,692) | 412,664 | |||
Balance at beginning of the period (in shares) at Mar. 31, 2022 | 172,523,557 | 26,426,937 | ||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Net loss | (35,801) | (35,801) | ||||||
Common stock issued upon exercise of stock options | 159 | 159 | ||||||
Common stock issued upon exercise of stock options (in shares) | 79,651 | |||||||
Common stock issued upon vesting of restricted stock units (in shares) | 213,324 | |||||||
Stock-based compensation expense | 9,667 | 9,667 | ||||||
Balance at end of the period at Jun. 30, 2022 | $ 17 | $ 3 | $ 894,162 | $ (507,493) | $ 386,689 | |||
Balance at end of the period (in shares) at Jun. 30, 2022 | 172,816,532 | 26,426,937 | 172,816,532 | 26,426,937 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Cash flows from operating activities: | ||
Net loss | $ (80,278) | $ (3,632) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 2,190 | 915 |
Non-cash interest expense on convertible debt | 0 | 389 |
Stock-based compensation expense | 18,015 | 28,035 |
Change in fair value of warrant liabilities | (17,968) | (87,570) |
Other | 137 | 498 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (909) | (1,979) |
Inventories | (29,344) | (21,113) |
Prepaid expenses and other assets | (3,493) | (6,352) |
Vendor advances | 11,330 | (3,519) |
Accounts payable | (2,437) | (11,088) |
Deferred revenue | 3,979 | 4,501 |
Change in operating lease assets and liabilities | 1,118 | (722) |
Accrued expenses and other liabilities | (569) | 1,708 |
Net cash used in operating activities | (98,229) | (99,929) |
Cash flows from investing activities: | ||
Purchases of marketable securities | 0 | (692,514) |
Sales of marketable securities | 0 | 202,000 |
Purchases of property and equipment, including capitalized software | (11,578) | (1,829) |
Net cash used in investing activities | (11,578) | (492,343) |
Cash flows from financing activities: | ||
Proceeds from exercise of stock options and warrants | 810 | 11,686 |
Net proceeds from equity infusion from the Business Combination | 0 | 548,403 |
Payment of loan payable | 0 | (4,366) |
Other financing activities | (101) | (52) |
Net cash provided by financing activities | 709 | 555,671 |
Net (decrease) increase in cash, cash equivalents and restricted cash | (109,098) | (36,601) |
Cash, cash equivalents and restricted cash, beginning of period | 426,841 | 60,206 |
Cash, cash equivalents and restricted cash, end of period | $ 317,743 | $ 23,605 |
Organization and Description of
Organization and Description of Business | 6 Months Ended |
Jun. 30, 2022 | |
Organization and Description of Business | |
Organization and Description of Business | Note 1. Organization and Description of Business Butterfly Network, Inc., formerly known as Longview Acquisition Corp. (the “Company” or “Butterfly”), was incorporated in Delaware on February 4, 2020. The Company’s legal name became Butterfly Network, Inc. following the closing of the business combination discussed in Note 3 “Business Combination”. The prior period financial information represents the financial results and condition of BFLY Operations, Inc. (formerly Butterfly Network, Inc.). The Company is an innovative digital health business transforming care with hand-held, whole-body ultrasound. Powered by its proprietary Ultrasound-on-Chip™ technology, the solution enables the acquisition of imaging information from an affordable, powerful device that fits in a healthcare professional’s pocket with a combination of cloud-connected software and hardware technology. The Company operates wholly-owned subsidiaries in Australia, Germany, Netherlands, the United Kingdom and Taiwan. Although the Company has incurred recurring losses in each year since inception, the Company expects its cash and cash equivalents will be sufficient to fund operations for at least the next twelve months. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | Note 2. Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of Butterfly Network, Inc. and its wholly-owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the accounting disclosure rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s audited consolidated financial statements as of and for the years ended December 31, 2021 and 2020. All intercompany balances and transactions are eliminated upon consolidation. The condensed consolidated balance sheet as of December 31, 2021, included herein, was derived from the audited consolidated financial statements as of that date, but does not include all disclosures, including certain notes required by U.S. GAAP, required on an annual reporting basis. In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods. The results for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for any subsequent quarter, the year ending December 31, 2022, or any other period. Except as described elsewhere in the notes, there have been no material changes to the Company’s significant accounting policies as described in the audited consolidated financial statements as of December 31, 2021 and 2020. COVID-19 Outbreak The COVID-19 pandemic that began in 2020 has created significant global economic uncertainty and has impacted the Company’s operating results, financial condition and cash flows. The full extent to which the COVID-19 pandemic will directly or indirectly impact the Company’s business, results of operations and financial condition will depend on The Company has not incurred any significant impairment losses in the carrying values of its assets as a result of the COVID-19 pandemic and is not aware of any specific related event or circumstance that would require the Company to revise the estimates reflected in its financial statements. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash and cash equivalents, and accounts receivable. At June 30, 2022, substantially all of the Company’s cash and cash equivalents were invested in money market accounts at one financial institution. The Company also maintains balances in various operating accounts above federally insured limits. The Company has not experienced any significant losses on such accounts and does not believe it is exposed to any significant credit risk on cash and cash equivalents. One customer accounted for 14% and 15% of the Company’s accounts receivable as of June 30, 2022 and December 31, 2021, respectively. For the three and six months ended June 30, 2022 and 2021, no customer accounts for more than 10% of the total revenues. Segment Information The Company’s Chief Operating Decision Maker, its Chief Executive Officer (“CEO”), reviews the financial information presented on a consolidated basis for purposes of allocating resources and evaluating its financial performance. Accordingly, the Company has determined that it operates in a single reportable segment. Substantially all of the Company’s long-lived assets are located in the United States. Since the Company operates in one operating segment, all required financial segment information can be found in the condensed consolidated financial statements. Use of Estimates The Company makes estimates and assumptions about future events that affect the amounts reported in its condensed consolidated financial statements and accompanying notes. Future events and their effects cannot be determined with certainty. On an ongoing basis, management evaluates these estimates, judgments and assumptions. The Company bases its estimates on historical and anticipated results and trends and on various other assumptions that the Company believes are reasonable under the circumstances, including assumptions as to future events. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates, and any such differences may be material to the Company’s condensed consolidated financial statements. There have been no material changes to the Company’s use of estimates as described in the audited consolidated financial statements as of December 31, 2021. |
Business Combination
Business Combination | 6 Months Ended |
Jun. 30, 2022 | |
Business Combination | |
Business Combination | Note 3. Business Combination On February 12, 2021 (the “Closing” or the “Closing Date”), the Company consummated the business combination (the “Business Combination”) with Butterfly Network, Inc. (“Legacy Butterfly”). In connection with the Business Combination and the transactions related to the Business Combination (the “Transactions”), Legacy Butterfly merged with and into a wholly owned subsidiary of the Company, with Legacy Butterfly surviving the Business Combination as a wholly owned subsidiary of the Company (the “Merger”). The Merger was accounted for as a reverse recapitalization in accordance with U.S. GAAP primarily due to the fact that Legacy Butterfly stockholders continue to control the Company following the Closing of the Business Combination. The most significant change in the post-combination Company’s reported financial position and results was an increase in cash of $ |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jun. 30, 2022 | |
Revenue Recognition | |
Revenue Recognition | Note 4. Revenue Recognition Disaggregation of Revenue The Company disaggregates revenue from contracts with customers by product type and by geographical market. The Company believes that these categories aggregate the payor types by nature, amount, timing and uncertainty of their revenue streams. The following table summarizes the Company’s disaggregated revenues (in thousands) for the three and six months ended June 30, 2022 and 2021: Pattern of Three months ended June 30, Six months ended June 30, Recognition 2022 2021 2022 2021 By Product Type: Devices and accessories Point-in-time $ 13,429 $ 13,012 $ 24,443 $ 22,608 Subscription services and other services Over time 5,786 3,501 10,346 6,350 Total revenue $ 19,215 $ 16,513 $ 34,789 $ 28,958 By Geographical Market: United States $ 12,995 $ 11,146 $ 24,299 $ 20,042 International 6,220 5,367 10,490 8,916 Total revenue $ 19,215 $ 16,513 $ 34,789 $ 28,958 Contract Balances Contract balances represent amounts presented in the condensed consolidated balance sheets when either the Company has transferred goods or services to the customer, or the customer has paid consideration to the Company under the contract. These contract balances include trade accounts receivable and deferred revenue. Deferred revenue represents cash consideration received from customers for services that are transferred to the customer over the respective subscription period. The accounts receivable balances represent amounts billed to customers for goods and services where the Company has an unconditional right to payment of the amount billed. The Company recognizes a receivable when it has an unconditional right to payment, and payment terms are typically 30 days for all product and service sales. The allowance for doubtful accounts was $0.4 million as of June 30, 2022 and December 31, 2021. The amount of revenue recognized during the three months ended June 30, 2022 and 2021 that was included in the deferred revenue balance at the beginning of the period was $5.3 million and $3.6 million, respectively. The amount of revenue recognized during the six months ended June 30, 2022 and 2021 that was included in the deferred revenue balance at the beginning of the period was $8.4 million and $5.6 million, respectively. The Company incurs incremental costs of obtaining contracts and costs of fulfilling contracts with customers. The amount of costs capitalized for the periods presented herein was not significant. Transaction Price Allocated to Remaining Performance Obligations On June 30, 2022, the Company had $26.2 million of remaining performance obligations. The Company expects to recognize 68% of its remaining performance obligations as revenue in the next |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value of Financial Instruments | |
Fair Value of Financial Instruments | Note 5. Fair Value of Financial Instruments Fair value estimates of financial instruments are made at a specific point in time, based on relevant information about financial markets and specific financial instruments. As these estimates are subjective in nature, involving uncertainties and matters of significant judgment, they cannot be determined with precision. Changes in assumptions can significantly affect estimated fair value. The Company measures fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The Company utilizes a three-tier hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: ● Level 1 — Valuations based on quoted prices in active markets for identical assets or liabilities that an entity has the ability to access. ● Level 2 — Valuations based on quoted prices for similar assets or liabilities, quoted prices for identical assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities. ● Level 3 — Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company has no assets or liabilities valued with Level 3 inputs. The carrying value of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximates their fair values due to the short-term or on-demand nature of these instruments. There were no transfers between fair value measurement levels during the periods ended June 30, 2022 and December 31, 2021. The Company’s outstanding warrants include publicly traded warrants (the “Public Warrants”) which were issued as one The Company determined the fair value of its Public Warrants as Level 1 financial instruments, as they are traded in active markets. Because any transfer of Private Warrants from the initial holder of the Private Warrants would result in the Private Warrants having substantially the same terms as the Public Warrants, management determined that the fair value of each Private Warrant is the same as that of a Public Warrant. Accordingly, the Private Warrants are classified as Level 2 financial instruments. The following table summarizes the Company’s assets and liabilities that are measured at fair value on a recurring basis, by level, within the fair value hierarchy (in thousands): Fair Value Measurement Level Total Level 1 Level 2 Level 3 June 30, 2022: Warrants: Public Warrants $ 5,520 $ 5,520 $ — $ — Private Warrants 2,741 — 2,741 — Total liabilities at fair value on a recurring basis $ 8,261 $ 5,520 $ 2,741 $ — December 31, 2021: Warrants: Public Warrants $ 17,525 $ 17,525 $ — $ — Private Warrants 8,704 — 8,704 — Total liabilities at fair value on a recurring basis $ 26,229 $ 17,525 $ 8,704 $ — |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2022 | |
Inventories | |
Inventories | Note 6. Inventories A summary of inventories is as follows at June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, 2022 2021 Raw materials $ 48,636 19,853 Work-in-progress 2,851 1,122 Finished goods 14,100 15,268 Total inventories $ 65,587 $ 36,243 Work-in-progress represents inventory items in intermediate stages of production by third-party manufacturers. For the three and six months ended June 30, 2022 and 2021, net realizable value inventory adjustments and excess and obsolete inventory charges were not significant and were recognized in product cost of revenues. |
Property and Equipment, Net
Property and Equipment, Net | 6 Months Ended |
Jun. 30, 2022 | |
Property and Equipment, Net | |
Property and Equipment, Net | Note 7. Property and Equipment, Net The Company’s property and equipment, net consists of the following at June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, 2022 2021 Property and equipment, gross $ 36,091 $ 20,079 Less: accumulated depreciation and amortization (7,514) (5,376) Property and equipment, net $ 28,577 $ 14,703 The Company excluded $1.0 million of accrued property and equipment as of June 30, 2022 from the cash used in investing activities on the condensed consolidated statements of cash flows. The amount excluded as of June 30, 2021 was not significant. |
Restricted Cash
Restricted Cash | 6 Months Ended |
Jun. 30, 2022 | |
Restricted Cash | |
Restricted Cash | Note 8. Restricted Cash A reconciliation of cash, cash equivalents and restricted cash as of June 30, 2022 and 2021, from the condensed consolidated balance sheets to the condensed consolidated statements of cash flows is as follows: June 30, 2022 2021 Reconciliation of cash, cash equivalents and restricted cash: Cash and cash equivalents $ 310,802 $ 19,605 Restricted cash included within prepaid expenses and other current assets 2,941 — Restricted cash included within other non-current assets 4,000 4,000 Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows $ 317,743 $ 23,605 In the second quarter of 2021, the Company delivered a $4.0 million letter of credit for the Company’s Burlington, MA lease, secured by a deposit of the same amount with a financial institution that issued the letter of credit. The deposit is classified as restricted cash and included in other non-current assets on the condensed consolidated balance sheets. In the first quarter of 2022, the Company received $4.8 million from the Bill & Melinda Gates Foundation (“BMGF”). Due to a legal restriction in the agreement with the BMGF, these funds are classified as restricted cash and included in prepaid expenses and other current assets on the condensed consolidated balance sheets. As of June 30, 2022, the Company has released $1.8 million of the BMGF funds from restricted cash as the Company partially fulfilled its obligations under the agreement. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 6 Months Ended |
Jun. 30, 2022 | |
Accrued Expenses and Other Current Liabilities | |
Accrued Expenses and Other Current Liabilities | Note 9. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following at June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, 2022 2021 Employee compensation $ 8,884 $ 12,746 Customer deposits 1,375 1,850 Accrued warranty liability 283 266 Non-income tax 1,551 2,477 Professional fees 5,393 2,797 Current portion of operating lease liabilities 1,745 1,391 Other 5,767 4,104 Total accrued expenses and other current liabilities $ 24,998 $ 25,631 Warranty expense activity for the three and six months ended June 30, 2022 and 2021 is as follows (in thousands): Three months ended June 30, Six months ended June 30, 2022 2021 2022 2021 Balance, beginning of period $ 1,094 $ 1,186 $ 1,116 $ 1,826 Warranty provision charged to operations 5 167 165 (225) Warranty claims (124) (192) (306) (440) Balance, end of period $ 975 $ 1,161 $ 975 $ 1,161 The Company classifies its accrued warranty liability based on the timing of expected warranty activity. The future costs of expected activity greater than one year is recorded within other non-current liabilities on the condensed consolidated balance sheet. |
Equity Incentive Plans
Equity Incentive Plans | 6 Months Ended |
Jun. 30, 2022 | |
Equity Incentive Plans | |
Equity Incentive Plans | Note 10. Equity Incentive Plans During the three and six months ended June 30, 2022, there were no significant changes to the Company’s 2012 Employee, Director and Consultant Equity Incentive Plan, as amended, (the “2012 Plan”) and the Company’s Amended and Restated 2020 Equity Incentive Plan (the “2020 Plan”). In the fiscal year 2022, pursuant to the terms of the 2020 Plan, the number of shares that may be issued was increased automatically by 4% of the number of outstanding shares of common stock on January 1, 2022. Stock option activity The following table summarizes the changes in the Company’s outstanding stock options for the six months ended June 30, 2022: Number of Options Outstanding at December 31, 2021 16,243,532 Granted 869,778 Exercised (343,567) Forfeited (1,224,937) Outstanding at June 30, 2022 15,544,806 Each award will vest based on continued service per the award agreement. The grant date fair value of the award will be recognized as stock-based compensation expense over the requisite service period. The grant date fair value was determined using similar methods and assumptions as those previously disclosed by the Company. Restricted stock unit (“RSU”) activity The following table summarizes the changes in the Company’s outstanding restricted stock units for the six months ended June 30, 2022: Number of RSUs Outstanding at December 31, 2021 3,958,825 Granted 10,663,776 Vested (879,515) Forfeited (967,855) Outstanding at June 30, 2022 12,775,231 Generally, each award will vest based on continued service per the award agreement. The grant date fair value of the award will be recognized as stock-based compensation expense over the requisite service period. The fair value of restricted stock units was estimated on the date of grant based on the fair value of the Company’s Class A common stock. The Company’s total stock-based compensation expense for all equity awards for the periods presented is as follows (in thousands): Three months ended June 30, Six months ended June 30, 2022 2021 2022 2021 Cost of revenue – subscription $ 33 $ 1 $ 42 $ 3 Research and development 3,595 1,562 6,374 2,953 Sales and marketing 2,128 2,085 3,899 3,758 General and administrative 3,529 4,090 7,700 21,321 Total stock-based compensation expense $ 9,285 $ 7,738 $ 18,015 $ 28,035 |
Net Loss Per Share
Net Loss Per Share | 6 Months Ended |
Jun. 30, 2022 | |
Net Loss Per Share | |
Net Loss Per Share | Note 11. Net Loss Per Share We compute net loss per share of Class A and Class B common stock using the two-class method. Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of each class of the Company’s common stock outstanding during the period. Diluted net loss per share is computed by giving effect to all potential shares of the Company’s common stock, including those presented in the table below, to the extent dilutive. Basic and diluted net loss per share was the same for each period presented as the inclusion of all potential shares of the Company’s common stock outstanding would have been anti-dilutive. As the Company uses the two-class method required for companies with multiple classes of common stock, the following table presents the calculation of basic and diluted net loss per share for each class of the Company’s common stock outstanding (in thousands, except share and per share amounts): Three months ended June 30, 2022 Total Class A Class B Common Stock Numerator: Allocation of undistributed earnings $ (31,056) $ (4,745) $ (35,801) Numerator for basic and diluted net loss per share – loss available to common stockholders $ (31,056) $ (4,745) $ (35,801) Denominator: Weighted-average common shares outstanding 172,972,419 26,426,937 199,399,356 Denominator for basic and diluted net loss per share – weighted-average common stock 172,972,419 26,426,937 199,399,356 Basic and diluted net loss per share $ (0.18) $ (0.18) $ (0.18) Three months ended June 30, 2021 Total Class A Class B Common Stock Numerator: Allocation of undistributed earnings $ (2,537) $ (405) $ (2,942) Numerator for basic and diluted net loss per share – loss available to common stockholders $ (2,537) $ (405) $ (2,942) Denominator: Weighted-average common shares outstanding 165,753,204 26,426,937 192,180,141 Denominator for basic and diluted net loss per share – weighted-average common stock 165,753,204 26,426,937 192,180,141 Basic and diluted net loss per share $ (0.02) $ (0.02) $ (0.02) Six months ended June 30, 2022 Total Class A Class B Common Stock Numerator: Allocation of undistributed earnings $ (69,628) $ (10,650) $ (80,278) Numerator for basic and diluted net loss per share – loss available to common stockholders $ (69,628) $ (10,650) $ (80,278) Denominator: Weighted-average common shares outstanding 172,773,972 26,426,937 199,200,909 Denominator for basic and diluted net loss per share – weighted-average common stock 172,773,972 26,426,937 199,200,909 Basic and diluted net loss per share $ (0.40) $ (0.40) $ (0.40) Six months ended June 30, 2021 Total Class A Class B Common Stock Numerator: Allocation of undistributed earnings $ (3,138) $ (494) $ (3,632) Numerator for basic and diluted net loss per share – loss available to common stockholders $ (3,138) $ (494) $ (3,632) Denominator: Weighted-average common shares outstanding 128,991,979 20,294,721 149,286,700 Denominator for basic and diluted net loss per share – weighted-average common stock 128,991,979 20,294,721 149,286,700 Basic and diluted net loss per share $ (0.02) $ (0.02) $ (0.02) For the periods presented above, the net loss per share amounts are the same for Class A and Class B common stock because the holders of each class are entitled to equal per share dividends or distributions in liquidation in accordance with the Certificate of Incorporation. The undistributed earnings for each year are allocated based on the contractual participation rights of the Class A and Class B common stock as if the earnings for the year had been distributed. As the liquidation and dividend rights are identical, the undistributed earnings are allocated on a proportionate basis. For the periods presented, anti-dilutive common equivalent shares were as follows: June 30, 2022 2021 Outstanding options to purchase common stock 15,544,806 17,351,206 Outstanding restricted stock units 12,653,874 3,338,871 Outstanding warrants 20,652,737 20,653,028 Total anti-dilutive common equivalent shares 48,851,417 41,343,105 |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2022 | |
Related Party Transactions | |
Related Party Transactions | Note 12. Related Party Transactions There were no significant changes in the nature of the Company’s related party transactions since December 31, 2021. Pursuant to a First Addendum dated November 19, 2020 to the Amended and Restated Technology Services Agreement dated November 11, 2020 by and between the Company, 4Catalyzer Corporation (“4Catalyzer”), and other participant companies controlled by Dr. Rothberg (the “ARTSA”), Butterfly terminated its participation under the ARTSA immediately prior to the effective time of the Business Combination. The related-party transactions with 4Catalyzer were not significant for the three and six months ended June 30, 2022 and 2021. The related-party balances with 4Catalyzer were not significant as of June 30, 2022 and December 31, 2021. On February 2, 2022, an Executive Officer of the Company and an irrevocable trust previously established by a member of our board of directors formed a limited liability company (“LLC”) to purchase real estate and entered into an operating agreement setting forth the terms and conditions of the LLC. There was no impact as a result of this transaction to our condensed consolidated financial statements for the three and six months ended June 30, 2022. |
401(k) Retirement Plan
401(k) Retirement Plan | 6 Months Ended |
Jun. 30, 2022 | |
401(k) Retirement Plan | |
401(k) Retirement Plan | Note 13. 401(k) Retirement Plan The Company sponsors a 401(k) defined contribution plan covering all eligible U.S. employees. Contributions to the 401(k) plan are discretionary. Effective January 1, 2022, the Company began making matching contributions to the 401(k) plan. The expense related to the matching contributions was $0.3 million and $0.8 million for the three months and six months ended June 30, 2022, respectively. The Company did not make any matching contributions to the 401(k) plan for the three months and six months ended June 30, 2021. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies. | |
Commitments and Contingencies | Note 14. Commitments and Contingencies Commitments Leases: The Company primarily enters into leases for office space that are classified as operating leases. Purchase commitments: The Company enters into inventory purchase commitments with third-party manufacturers in the ordinary course of business. These commitments are generally non-cancellable and are based on sales forecasts. These agreements range from one There were no significant changes to the inventory supply agreement with the certain third-party manufacturing vendor during the three and six months ended June 30, 2022. The Company applied the guidance in Topic 330, Inventory As of June 30, 2022, the Company has a vendor advance asset of $17.9 million, net of write-downs and an accrued purchase commitment liability of $19.3 million related to the agreement. The portion of the balances that is expected to be utilized in the next 12 months is included in current assets and current liabilities in the accompanying condensed consolidated balance sheets. Contingencies The Company is involved in litigation and legal matters from time to time, which have arisen in the normal course of business. Although the ultimate results of these matters are not currently determinable, management does not expect that they will have a material effect on the Company’s condensed consolidated balance sheets, statements of operations and comprehensive loss, or statements of cash flows. On February 16, 2022, a putative class action lawsuit, styled Rose v. Butterfly Network, Inc., et al. was filed in the United States District Court for the District of New Jersey against the Company, its President and Chief Executive Officer, its then Chief Financial Officer, the Chairman of its board of directors, as well as Longview’s Chairman (who is a director of the Company), Chief Executive Officer, Chief Financial Officer and members of Longview’s board of directors prior to the Business Combination, alleging violations of Sections 10(b), 14(a) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rules 10b-5 and 14a-9 promulgated thereunder. The alleged class consists of all persons or entities who purchased or otherwise acquired the Company’s stock between February 16, 2021 and November 15, 2021 and/or holders as of the record date for the special meeting of shareholders held on February 12, 2021 in connection with the approval of the Business Combination. The lawsuit is premised upon allegations that the defendants made false and misleading statements and/or omissions about its post-Business Combination business and financial prospects, including the impact of the COVID-19 pandemic. The Company intends to vigorously defend against this action. The lawsuit seeks unspecified damages, together with interest thereon, as well as the costs and expenses of litigation. There is no assurance that the Company will be successful in the defense of the litigation or that insurance will be available or adequate to fund any potential settlement or judgment or the litigation costs of the action. The Company is unable to predict the outcome or reasonably estimate a range of possible loss at this time. On March 9, 2022, Fujifilm Sonosite, Inc. (“Fujifilm”) filed a complaint against the Company, styled Fujifilm Sonosite, Inc. v. Butterfly Network, Inc. On June 21, 2022, a stockholder derivative action, styled Koenig v. Todd M. Fruchterman, et al. (Case 1:22-cv-00825) was filed in the United States District Court for the District of Delaware against the Board of Directors and the Company as nominal defendant, alleging violation of Section 14(a) of the Securities Exchange Act of 1934, as amended, and Rule 14a-9 promulgated thereunder, and claims for breach of fiduciary duty, contribution and indemnification, aiding and abetting and gross mismanagement. The lawsuit is premised upon allegedly inadequate internal controls, purportedly misleading representations regarding the Company’s financial condition and business prospects and the Company’s November 2021 earnings announcement. The Company intends to vigorously defend against this action. The lawsuit seeks unspecified damages, disgorgement and restitution, together with interest thereon, as well as the costs and expenses of litigation. There is no assurance that the Company will be successful in the defense of the litigation or that insurance will be available or adequate to fund any potential settlement or judgment or the litigation costs of the action. The Company is unable to predict the outcome or reasonably estimate a range of possible loss at this time The Company enters into agreements that contain indemnification provisions with other parties in the ordinary course of business, including business partners, investors, contractors, customers and the Company’s officers, directors and certain employees. The Company has agreed to indemnify and defend the indemnified party claims and related losses suffered or incurred by the indemnified party from actual or threatened third-party claims because of the Company’s activities or non-compliance with certain representations and warranties made by the Company. It is not possible to determine the maximum potential loss under these indemnification provisions due to the Company’s limited history of prior indemnification claims and the unique facts and circumstances involved in any particular case. To date, losses recorded in the Company’s condensed consolidated statements of operations and comprehensive loss in connection with the indemnification provisions have not been material. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2022 | |
Subsequent Events | |
Subsequent Events | Note 15. Subsequent Events On July 28, 2022, the board of directors approved a plan designed to improve the Company’s efficiency by reducing operating expenses and extending liquidity. In addition to decreasing other operating expenses, the plan includes a reduction in force representing approximately 10% of the Company’s workforce. The Company estimates that it will incur approximately $2 million of cash charges related to employee severance and benefits costs, substantially all of which the Company expects to incur in the third and fourth quarters of 2022. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Summary of Significant Accounting Policies | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of Butterfly Network, Inc. and its wholly-owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the accounting disclosure rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s audited consolidated financial statements as of and for the years ended December 31, 2021 and 2020. All intercompany balances and transactions are eliminated upon consolidation. The condensed consolidated balance sheet as of December 31, 2021, included herein, was derived from the audited consolidated financial statements as of that date, but does not include all disclosures, including certain notes required by U.S. GAAP, required on an annual reporting basis. In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods. The results for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for any subsequent quarter, the year ending December 31, 2022, or any other period. Except as described elsewhere in the notes, there have been no material changes to the Company’s significant accounting policies as described in the audited consolidated financial statements as of December 31, 2021 and 2020. |
COVID-19 Outbreak | COVID-19 Outbreak The COVID-19 pandemic that began in 2020 has created significant global economic uncertainty and has impacted the Company’s operating results, financial condition and cash flows. The full extent to which the COVID-19 pandemic will directly or indirectly impact the Company’s business, results of operations and financial condition will depend on The Company has not incurred any significant impairment losses in the carrying values of its assets as a result of the COVID-19 pandemic and is not aware of any specific related event or circumstance that would require the Company to revise the estimates reflected in its financial statements. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash and cash equivalents, and accounts receivable. At June 30, 2022, substantially all of the Company’s cash and cash equivalents were invested in money market accounts at one financial institution. The Company also maintains balances in various operating accounts above federally insured limits. The Company has not experienced any significant losses on such accounts and does not believe it is exposed to any significant credit risk on cash and cash equivalents. One customer accounted for 14% and 15% of the Company’s accounts receivable as of June 30, 2022 and December 31, 2021, respectively. For the three and six months ended June 30, 2022 and 2021, no customer accounts for more than 10% of the total revenues. |
Segment Information | Segment Information The Company’s Chief Operating Decision Maker, its Chief Executive Officer (“CEO”), reviews the financial information presented on a consolidated basis for purposes of allocating resources and evaluating its financial performance. Accordingly, the Company has determined that it operates in a single reportable segment. Substantially all of the Company’s long-lived assets are located in the United States. Since the Company operates in one operating segment, all required financial segment information can be found in the condensed consolidated financial statements. |
Use of Estimates | Use of Estimates The Company makes estimates and assumptions about future events that affect the amounts reported in its condensed consolidated financial statements and accompanying notes. Future events and their effects cannot be determined with certainty. On an ongoing basis, management evaluates these estimates, judgments and assumptions. The Company bases its estimates on historical and anticipated results and trends and on various other assumptions that the Company believes are reasonable under the circumstances, including assumptions as to future events. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates, and any such differences may be material to the Company’s condensed consolidated financial statements. There have been no material changes to the Company’s use of estimates as described in the audited consolidated financial statements as of December 31, 2021. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Revenue Recognition | |
Schedule of disaggregated revenue | Pattern of Three months ended June 30, Six months ended June 30, Recognition 2022 2021 2022 2021 By Product Type: Devices and accessories Point-in-time $ 13,429 $ 13,012 $ 24,443 $ 22,608 Subscription services and other services Over time 5,786 3,501 10,346 6,350 Total revenue $ 19,215 $ 16,513 $ 34,789 $ 28,958 By Geographical Market: United States $ 12,995 $ 11,146 $ 24,299 $ 20,042 International 6,220 5,367 10,490 8,916 Total revenue $ 19,215 $ 16,513 $ 34,789 $ 28,958 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value of Financial Instruments | |
Schedule of assets and liabilities measured at fair value on a recurring basis | Fair Value Measurement Level Total Level 1 Level 2 Level 3 June 30, 2022: Warrants: Public Warrants $ 5,520 $ 5,520 $ — $ — Private Warrants 2,741 — 2,741 — Total liabilities at fair value on a recurring basis $ 8,261 $ 5,520 $ 2,741 $ — December 31, 2021: Warrants: Public Warrants $ 17,525 $ 17,525 $ — $ — Private Warrants 8,704 — 8,704 — Total liabilities at fair value on a recurring basis $ 26,229 $ 17,525 $ 8,704 $ — |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Inventories | |
Summary of inventories | A summary of inventories is as follows at June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, 2022 2021 Raw materials $ 48,636 19,853 Work-in-progress 2,851 1,122 Finished goods 14,100 15,268 Total inventories $ 65,587 $ 36,243 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Property and Equipment, Net | |
Schedule of property and equipment, net | The Company’s property and equipment, net consists of the following at June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, 2022 2021 Property and equipment, gross $ 36,091 $ 20,079 Less: accumulated depreciation and amortization (7,514) (5,376) Property and equipment, net $ 28,577 $ 14,703 |
Restricted Cash (Tables)
Restricted Cash (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Restricted Cash | |
Summary of reconciliation of cash, cash equivalents and restricted cash | June 30, 2022 2021 Reconciliation of cash, cash equivalents and restricted cash: Cash and cash equivalents $ 310,802 $ 19,605 Restricted cash included within prepaid expenses and other current assets 2,941 — Restricted cash included within other non-current assets 4,000 4,000 Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows $ 317,743 $ 23,605 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Accrued Expenses and Other Current Liabilities | |
Schedule of accrued expenses and other current liabilities | Accrued expenses and other current liabilities consist of the following at June 30, 2022 and December 31, 2021 (in thousands): June 30, December 31, 2022 2021 Employee compensation $ 8,884 $ 12,746 Customer deposits 1,375 1,850 Accrued warranty liability 283 266 Non-income tax 1,551 2,477 Professional fees 5,393 2,797 Current portion of operating lease liabilities 1,745 1,391 Other 5,767 4,104 Total accrued expenses and other current liabilities $ 24,998 $ 25,631 |
Schedule of warranty expense activity | Warranty expense activity for the three and six months ended June 30, 2022 and 2021 is as follows (in thousands): Three months ended June 30, Six months ended June 30, 2022 2021 2022 2021 Balance, beginning of period $ 1,094 $ 1,186 $ 1,116 $ 1,826 Warranty provision charged to operations 5 167 165 (225) Warranty claims (124) (192) (306) (440) Balance, end of period $ 975 $ 1,161 $ 975 $ 1,161 |
Equity Incentive Plans (Tables)
Equity Incentive Plans (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Equity Incentive Plans | |
Summary of the stock option activity | Number of Options Outstanding at December 31, 2021 16,243,532 Granted 869,778 Exercised (343,567) Forfeited (1,224,937) Outstanding at June 30, 2022 15,544,806 |
Summary of the restricted stock unit activity | Number of RSUs Outstanding at December 31, 2021 3,958,825 Granted 10,663,776 Vested (879,515) Forfeited (967,855) Outstanding at June 30, 2022 12,775,231 |
Schedule of stock-based compensation expense | The Company’s total stock-based compensation expense for all equity awards for the periods presented is as follows (in thousands): Three months ended June 30, Six months ended June 30, 2022 2021 2022 2021 Cost of revenue – subscription $ 33 $ 1 $ 42 $ 3 Research and development 3,595 1,562 6,374 2,953 Sales and marketing 2,128 2,085 3,899 3,758 General and administrative 3,529 4,090 7,700 21,321 Total stock-based compensation expense $ 9,285 $ 7,738 $ 18,015 $ 28,035 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Net Loss Per Share | |
Schedule of calculation of basic and diluted net loss per share | Three months ended June 30, 2022 Total Class A Class B Common Stock Numerator: Allocation of undistributed earnings $ (31,056) $ (4,745) $ (35,801) Numerator for basic and diluted net loss per share – loss available to common stockholders $ (31,056) $ (4,745) $ (35,801) Denominator: Weighted-average common shares outstanding 172,972,419 26,426,937 199,399,356 Denominator for basic and diluted net loss per share – weighted-average common stock 172,972,419 26,426,937 199,399,356 Basic and diluted net loss per share $ (0.18) $ (0.18) $ (0.18) Three months ended June 30, 2021 Total Class A Class B Common Stock Numerator: Allocation of undistributed earnings $ (2,537) $ (405) $ (2,942) Numerator for basic and diluted net loss per share – loss available to common stockholders $ (2,537) $ (405) $ (2,942) Denominator: Weighted-average common shares outstanding 165,753,204 26,426,937 192,180,141 Denominator for basic and diluted net loss per share – weighted-average common stock 165,753,204 26,426,937 192,180,141 Basic and diluted net loss per share $ (0.02) $ (0.02) $ (0.02) Six months ended June 30, 2022 Total Class A Class B Common Stock Numerator: Allocation of undistributed earnings $ (69,628) $ (10,650) $ (80,278) Numerator for basic and diluted net loss per share – loss available to common stockholders $ (69,628) $ (10,650) $ (80,278) Denominator: Weighted-average common shares outstanding 172,773,972 26,426,937 199,200,909 Denominator for basic and diluted net loss per share – weighted-average common stock 172,773,972 26,426,937 199,200,909 Basic and diluted net loss per share $ (0.40) $ (0.40) $ (0.40) Six months ended June 30, 2021 Total Class A Class B Common Stock Numerator: Allocation of undistributed earnings $ (3,138) $ (494) $ (3,632) Numerator for basic and diluted net loss per share – loss available to common stockholders $ (3,138) $ (494) $ (3,632) Denominator: Weighted-average common shares outstanding 128,991,979 20,294,721 149,286,700 Denominator for basic and diluted net loss per share – weighted-average common stock 128,991,979 20,294,721 149,286,700 Basic and diluted net loss per share $ (0.02) $ (0.02) $ (0.02) |
Schedule of anti-dilutive common equivalent shares | June 30, 2022 2021 Outstanding options to purchase common stock 15,544,806 17,351,206 Outstanding restricted stock units 12,653,874 3,338,871 Outstanding warrants 20,652,737 20,653,028 Total anti-dilutive common equivalent shares 48,851,417 41,343,105 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Concentration of Credit Risk (Details) - Customer Concentration Risk - customer | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Accounts receivable | |||||
Number of customers | 1 | 1 | |||
Revenues | |||||
Number of customers | 0 | 0 | 0 | 0 | |
Major Customer | Accounts receivable | |||||
Concentration risk (as a percentage) | 14% | 15% |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Segment information (Details) | 6 Months Ended |
Jun. 30, 2022 segment | |
Summary of Significant Accounting Policies | |
Number of operating segments | 1 |
Business Combination (Details)
Business Combination (Details) $ in Millions | Feb. 12, 2021 USD ($) |
Business Combination | |
Increase in cash | $ 589.5 |
Transaction costs | 11.4 |
Significant liabilities incurred and paid off, excluding warrant liabilities | 30.9 |
Amount of liabilities assumed | 186.5 |
Warrant liabilities | $ 187.3 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenue Recognition | ||||
Total revenue | $ 19,215 | $ 16,513 | $ 34,789 | $ 28,958 |
United States | ||||
Revenue Recognition | ||||
Total revenue | 12,995 | 11,146 | 24,299 | 20,042 |
International | ||||
Revenue Recognition | ||||
Total revenue | 6,220 | 5,367 | 10,490 | 8,916 |
Product | ||||
Revenue Recognition | ||||
Total revenue | 13,429 | 13,012 | 24,443 | 22,608 |
Subscription | ||||
Revenue Recognition | ||||
Total revenue | $ 5,786 | $ 3,501 | $ 10,346 | $ 6,350 |
Revenue Recognition - Contract
Revenue Recognition - Contract Balances (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Revenue Recognition | ||
Allowance for doubtful accounts | $ 0.4 | $ 0.4 |
Payment terms | 30 days |
Revenue Recognition - Performan
Revenue Recognition - Performance Obligations (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenue Recognition | ||||
Amount of revenue recognized | $ 5.3 | $ 3.6 | $ 8.4 | $ 5.6 |
Remaining performance obligations | $ 26.2 | $ 26.2 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-07-01 | ||||
Revenue Recognition | ||||
Percentage of remaining performance obligations as revenue | 68% | 68% | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 12 months | 12 months | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-01 | ||||
Revenue Recognition | ||||
Percentage of remaining performance obligations as revenue | 32% | 32% | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year | 1 year |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - Fair Value, Recurring - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Liabilities | ||
Total liabilities at fair value on a recurring basis | $ 8,261 | $ 26,229 |
Public Warrants | ||
Liabilities | ||
Warrants | 5,520 | 17,525 |
Private Warrants | ||
Liabilities | ||
Warrants | 2,741 | 8,704 |
Level 1 | ||
Liabilities | ||
Total liabilities at fair value on a recurring basis | 5,520 | 17,525 |
Level 1 | Public Warrants | ||
Liabilities | ||
Warrants | 5,520 | 17,525 |
Level 2 | ||
Liabilities | ||
Total liabilities at fair value on a recurring basis | 2,741 | 8,704 |
Level 2 | Private Warrants | ||
Liabilities | ||
Warrants | $ 2,741 | $ 8,704 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Narratives (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
May 26, 2020 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Warrants | |||||
Change in fair value of warrant liabilities | $ (12,805) | $ (33,458) | $ (17,968) | $ (87,570) | |
Public Warrants | |||||
Warrants | |||||
Warrants outstanding | 13,799,404 | 13,799,404 | |||
Value of public warrants per warrant issued during IPO (as a percent) | 33% | ||||
Private Warrants | |||||
Warrants | |||||
Warrants outstanding | 6,853,333 | 6,853,333 | |||
Class A Common Stock | |||||
Warrants | |||||
Shares called by warrants | 1 | 1 | |||
Exercise price | $ 11.50 | $ 11.50 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Inventories | ||
Raw materials | $ 48,636 | $ 19,853 |
Work-in-progress | 2,851 | 1,122 |
Finished goods | 14,100 | 15,268 |
Total inventories | $ 65,587 | $ 36,243 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Property and Equipment, Net | ||
Property and equipment, gross | $ 36,091 | $ 20,079 |
Less: accumulated depreciation and amortization | (7,514) | (5,376) |
Property and equipment, net | 28,577 | $ 14,703 |
Accrued property and equipment | $ 1,000 |
Restricted Cash (Details)
Restricted Cash (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 |
Reconciliation of cash, cash equivalents and restricted cash: | ||||
Cash and cash equivalents | $ 310,802 | $ 422,841 | $ 19,605 | |
Restricted cash included within prepaid expenses and other current assets | 2,941 | |||
Restricted cash included within other non-current assets | 4,000 | 4,000 | ||
Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows | $ 317,743 | $ 426,841 | $ 23,605 | $ 60,206 |
Restricted Cash and Cash Equivalents, Current, Statement of Financial Position [Extensible Enumeration] | Prepaid Expense and Other Assets, Current | |||
Restricted Cash and Cash Equivalents, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other Assets, Noncurrent |
Restricted Cash - Narratives (D
Restricted Cash - Narratives (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | |
Restricted Cash | |||
Security given as collateral | $ 4 | ||
Proceeds received from Bill & Melinda Gates Foundation | $ 4.8 | ||
BMGF funds released from restricted cash | $ 1.8 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Accrued Expenses and Other Current Liabilities | ||
Employee compensation | $ 8,884 | $ 12,746 |
Customer deposits | 1,375 | 1,850 |
Accrued warranty liability | 283 | 266 |
Non-income tax | 1,551 | 2,477 |
Professional fees | 5,393 | 2,797 |
Current portion of operating lease liabilities | $ 1,745 | $ 1,391 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Total accrued expenses and other current liabilities | Total accrued expenses and other current liabilities |
Other | $ 5,767 | $ 4,104 |
Total accrued expenses and other current liabilities | $ 24,998 | $ 25,631 |
Accrued Expenses and Other Cu_4
Accrued Expenses and Other Current Liabilities - Warranty expense activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Accrued Expenses and Other Current Liabilities | ||||
Balance, beginning of period | $ 1,094 | $ 1,186 | $ 1,116 | $ 1,826 |
Warranty provision charged to operations | 5 | 167 | 165 | (225) |
Warranty claims | (124) | (192) | (306) | (440) |
Balance, end of period | $ 975 | $ 1,161 | $ 975 | $ 1,161 |
Equity Incentive Plan (Details)
Equity Incentive Plan (Details) | Jan. 01, 2022 |
Equity Incentive Plans | |
Percentage of increment in shares outstanding | 4% |
Equity Incentive Plan - Stock o
Equity Incentive Plan - Stock option activity (Details) - Stock options | 6 Months Ended |
Jun. 30, 2022 shares | |
Number of Options | |
Outstanding at beginning of the period | 16,243,532 |
Granted | 869,778 |
Exercised | (343,567) |
Forfeited | (1,224,937) |
Outstanding at end of the period | 15,544,806 |
Equity Incentive Plan - Restric
Equity Incentive Plan - Restricted stock unit activity (Details) - Restricted stock units | 6 Months Ended |
Jun. 30, 2022 shares | |
Number of RSUs | |
Outstanding at beginning of the period | 3,958,825 |
Granted | 10,663,776 |
Vested | (879,515) |
Forfeited | (967,855) |
Outstanding at end of the period | 12,775,231 |
Equity Incentive Plan - Stock-b
Equity Incentive Plan - Stock-based compensation expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Equity Incentive Plan | ||||
Total stock-based compensation expense | $ 9,285 | $ 7,738 | $ 18,015 | $ 28,035 |
Cost of revenue - subscription | ||||
Equity Incentive Plan | ||||
Total stock-based compensation expense | 33 | 1 | 42 | 3 |
Research and development | ||||
Equity Incentive Plan | ||||
Total stock-based compensation expense | 3,595 | 1,562 | 6,374 | 2,953 |
Sales and marketing | ||||
Equity Incentive Plan | ||||
Total stock-based compensation expense | 2,128 | 2,085 | 3,899 | 3,758 |
General and administrative | ||||
Equity Incentive Plan | ||||
Total stock-based compensation expense | $ 3,529 | $ 4,090 | $ 7,700 | $ 21,321 |
Net Loss Per Share (Details)
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 | Dec. 31, 2021 | |
Numerator: | |||||
Allocation of undistributed earnings | $ (35,801) | $ (2,942) | $ (80,278) | $ (3,632) | |
Numerator for basic and diluted EPS - loss available to common stockholders | $ (35,801) | $ (2,942) | $ (80,278) | $ (3,632) | |
Denominator: | |||||
Weighted-average common shares outstanding - basic | 199,399,356 | 192,180,141 | 199,200,909 | 149,286,700 | |
Weighted-average common shares outstanding - diluted | 199,399,356 | 192,180,141 | 199,200,909 | 149,286,700 | |
Basic loss per share | $ (0.18) | $ (0.02) | $ (0.40) | $ (0.02) | |
Diluted loss per share | $ (0.18) | $ (0.02) | $ (0.40) | $ (0.02) | |
Class A Common Stock | |||||
Numerator: | |||||
Allocation of undistributed earnings | $ (31,056) | $ (2,537) | $ (69,628) | $ (3,138) | |
Numerator for basic and diluted EPS - loss available to common stockholders | $ (31,056) | $ (2,537) | $ (69,628) | $ (3,138) | |
Denominator: | |||||
Weighted-average common shares outstanding - basic | 172,972,419 | 165,753,204 | 172,773,972 | 128,991,979 | |
Weighted-average common shares outstanding - diluted | 172,972,419 | 165,753,204 | 172,773,972 | 128,991,979 | |
Basic loss per share | $ (0.18) | $ (0.02) | $ (0.40) | $ (0.02) | |
Diluted loss per share | $ (0.18) | $ (0.02) | $ (0.40) | $ (0.02) | |
Common stock, shares outstanding (in shares) | 172,816,532 | 172,816,532 | 171,613,049 | ||
Class B Common Stock | |||||
Numerator: | |||||
Allocation of undistributed earnings | $ (4,745) | $ (405) | $ (10,650) | $ (494) | |
Numerator for basic and diluted EPS - loss available to common stockholders | $ (4,745) | $ (405) | $ (10,650) | $ (494) | |
Denominator: | |||||
Weighted-average common shares outstanding - basic | 26,426,937 | 26,426,937 | 26,426,937 | 20,294,721 | |
Weighted-average common shares outstanding - diluted | 26,426,937 | 26,426,937 | 26,426,937 | 20,294,721 | |
Basic loss per share | $ (0.18) | $ (0.02) | $ (0.40) | $ (0.02) | |
Diluted loss per share | $ (0.18) | $ (0.02) | $ (0.40) | $ (0.02) | |
Common stock, shares outstanding (in shares) | 26,426,937 | 26,426,937 | 26,426,937 |
Net Loss Per Share - Anti-dilut
Net Loss Per Share - Anti-dilutive common equivalent shares (Details) - shares | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Net Loss Per Share | ||
Total anti-dilutive common equivalent shares | 48,851,417 | 41,343,105 |
Stock options | ||
Net Loss Per Share | ||
Total anti-dilutive common equivalent shares | 15,544,806 | 17,351,206 |
Restricted stock units | ||
Net Loss Per Share | ||
Total anti-dilutive common equivalent shares | 12,653,874 | 3,338,871 |
Outstanding warrants | ||
Net Loss Per Share | ||
Total anti-dilutive common equivalent shares | 20,652,737 | 20,653,028 |
401(k) Retirement Plan (Details
401(k) Retirement Plan (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 | Jun. 30, 2022 | |
401(k) Retirement Plan | ||
401(k) Employer match contribution | $ 0.3 | $ 0.8 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Commitments and Contingencies | ||||
Rent expense | $ 1.1 | $ 0.6 | $ 2.3 | $ 1.1 |
Inventory purchase commitments | ||||
Commitments and Contingencies | ||||
Minimum inventory purchase commitments | 86.4 | |||
Prepaid vendor advance, net of write-downs | 17.9 | 17.9 | ||
Accrued purchase commitments | $ 19.3 | $ 19.3 | ||
Minimum | Inventory purchase commitments | ||||
Commitments and Contingencies | ||||
Fixed or minimum annual commitments period (in years) | 1 year | |||
Maximum | Inventory purchase commitments | ||||
Commitments and Contingencies | ||||
Fixed or minimum annual commitments period (in years) | 5 years |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jul. 28, 2022 | Jun. 30, 2022 | |
Stock options | ||
Subsequent Events | ||
Granted | 869,778 | |
Subsequent event | ||
Subsequent Events | ||
Reduction in force (as a percent) | 10% | |
Employee severance and benefit costs | $ 2 |