Earnings call transcript Q4 2022

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Operator

Thank you for standing by. And welcome to the Akoya Biosciences Fourth Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions]

conference being today’s reminder, a call recorded. is As conference your host, will now to the turn I Mr. over Shah, Priyam Head of Investor Relations. sir. Please ahead, go

Priyam Shah

Thank call. you us thank Akoya Biosciences. of you, who at Operator, joining is Investor to Relations today Priyam I’m everyone this Shah, Head on and

press On today, ended copy results financial for Brian fourth quarter we is McKelligon, and A Executive Officer; release released the Driscoll, today Chief the the Akoya XX, on call December of XXXX. Joe Financial have company’s Chief Officer. available Earlier the website.

the to Before I’d forward-looking of Act you begin, of make Harbor are we Private will the to XXXX. of statements within this like federal Securities include remind that Litigation pursuant that which laws, Safe made call Reform management securities meaning during the statements provisions

statements the statements from call in future may results relate or or Actual factors. expectations expressed are those a this or differ events, to forward-looking results predictions forward-looking due in statements. to of performance variety of materially contained Any that implied

these Commission estimates these We you today, Exchange performance. description list factors not XX-K future refer aware and urge March please associated a uncertainties be and are statements to X, the should with Factors only a risks consider Securities and of you business, For the considered the and with of our Akoya Risk XXXX. filed section Form to that the are guarantee and of

revise otherwise. or only the except of any call and of under or of because website Investors will heading later information Akoya forward-looking accurate or be statements, time-sensitive as projections new the portion law, information, intention contains on is whether this X, call Events. future by to the as our today, today section obligation, conference XXXX. archived audio or live of The This events disclaims financial any required update broadcast March

listeners Conference to March like also inform Health Care be that tomorrow, the Xth. in will Cowen would Akoya We participating

person, events. in for this Relations planning please investor page see for our to other webcast If attend information upcoming you’re not and or Investor recent

will the And over that, turn to I call with now Brian.

Brian McKelligon

and a appreciate on Thank afternoon by year was capped good another Akoya record-breaking finish off XXXX yet the you, for with an Priyam, to joining and strong you excellent everyone. call us quarter. evening today. We

an execution revenue As solid we installed delivered the biology publication consistently market. growth commercial strong growth organization, and growth, and spatial base within

We track in with the instruments a record fourth and $XX.X reported in growth on full for and a year full the we installed XXXX, the in company. placements of the reach sold the a quarter are instruments year. year over instruments has of the growth from million XXX largest industry installed for year, and XXX XXXX, in for major million XX by prior $XX.X of quarter and year We fourth instruments. we prior base the revenue of early this of an the XX% total ended Akoya XX% instruments spatial the base X,XXX a the to milestone year

spatial XXX Akoya’s biology volume Additionally, to-date, the platforms the rapidly amongst largest now providers. publications is at featuring accelerating publications

gives confidence beyond. and consistent in growing and and momentum increasing publication in Our and execution, large market XXXX spatial the growth base installed biology the our business of us

sands. The technology molecular the the market company product or that rapid tissue assumption the setting whole vision of standard tissue understanding is and next-generation on at cellular single interactions NCX cell enabling Akoya’s industry level analysis, portfolio comprehensive for the fundamental tissue the analysis. founded across and requires a was imaging-based

clinical progress patient portfolio solidified our on with the We of our launch Fusion. we instrument our impacting made market of expanded goal long-term and segments the XXXX, footprint care. all significant In across

clinical market the end-to-end purpose-built discovery, and of market platforms translational to across Akoya the spatial full suite and brings biology a segments.

entire our portfolio continuity journey Our across of discovery to the allows and own the from clinic. biomarkers us reagents to technology, methods

the in as At and event Special our December, XXXX and roadmap product recent priorities Day follows. previewed is summary we our

further First, leadership our instruments in our introducing instrument we drive position reason the imaging spatial in are platform and across additional and will line across pull-through our improvements advance nearly workflow entire X,XXX market. that

Second, will our will operational third, in and patient commercial partnership markets XXXX. clinical investments we success efficiencies, on on to in improving care. targeted our goal And driving more the further advance including build we translational of focus

let one these Now more each me in address of detail.

both introducing plex of full discovery ready-made acceleration high-throughput expanded and PhenoImager take PhenoCycler of HT. simplification further studies. the translational and improvements, panels the the we HT include of menus improvements for on both Fusion PhenoCycler reagent are and Fusion the our for platform To Our workflows advantage PhenoImager high these for

panels PhenoCode be for biomarker panels name under These PhenoCode for and the will the PhenoCode. Fusion PhenoCycler brand panels HT. discovery marketed the signature new the

software and projected capacity system increases an Our of pull-through be increase reagent ready-made by partners plex answer. data from the reduce will and to throughput, improved time ecosystem and to to application breadth driven panels

carrier per supports the quarter, for of system Bio-Techne’s rollout includes a a doubles and and effectively parallel next for This RNAscope X.X tissue It in XX multi-slide in PhenoCycler release be workflow the Beginning increase PhenoCycler throughput is XXXX also on results week. X.X up and Fusion XX significant This on samples to simplification. processing release primary Fusion the the and improvement to the rolled the will out. system throughput samples Fusion. upgrade

multiomic targeted market. with X,XXX transcriptomics with higher across you, second Akoya’s is proprietary manner and gold of RNA adoption to spatial to-date assay ideal over introduce parallel, protein-based the broad will ultimately the and we approaches. studies. sciences remind solution solution publications life in to RNAscope complement I’ll is high-plex And spatial support RNA spatial transcriptomics an industry’s the NCX to RNAscope and made standard plex XXXX, a half in in phenotyping spatial validate discoveries

introduce that onto post-processing the mid-XXXX, analysis for improvements HT, we efforts informatic the standard. continuing will further steps to On the simplify clinical to on-instrument streamline directly we our HT post-processing HT workflow PhenoImager our true tissue and the are compute. and to a In moves

and result will annotation. and cellular consistency from throughput, be drive analysis reduction hours our data adoption. upgrade and for standardized rapid to The supports and and customer workflow This post-processing for a minutes clinical ultimately tissue an to demands in translational automated

Now improvements our new to offerings. speed reagent these of biomarker deliver PhenoCycler and greater system we on enable and the PhenoCode our panels, biological with of questions take comprehensiveness. PhenoCode the will advantage panels full ready-to-use answering introducing efficiency, focused Fusion to key customers a suite PhenoImager HT, are on These

to discovery designed PhenoCode applications. run Our on panels PhenoCycler for discovery-based are Fusion the

protein-based -- throughout will will will launch on the these a introduce be RNA with -- quarterly product panels first the later year coming will introduced solutions These in panels be The be cadence. year.

high share level, match PhenoCode AACR this to launched details more quickly will discovery at mix modules high but customers modules build year’s We as April, plex to will of early be our to a panel. and in the comprehensive at XX XX enabling meeting panels biomarkers, a

biological oncology, neurobiology. on are disease We core focused and address biomarkers questions and to in designed inflammatory key are

and protein, next, will continue a these range across applications RNA Throughout high plex of broad conference cohorts, we speed of the Stanford presented at panels to enabling AGBT throughput last sample for protein with science this and simultaneous high and and partners molecules great discovery across and month, out our and large at scale. multiomic detection RNA Akoya demonstrating At each applications, and year build customers. discovery PhenoCode

antibody the panels validated The which designed the for were trials, advancing PhenoImager run ongoing translational includes initial panels and clinical detection and format. landscape that panels immuno-oncology PhenoCode For a are the pre-design signature demand five our reagents to created markets, rapidly on clinical X,XXX therapy HT. nearly with ready-to-use

fast and a higher system higher result enable deployment increased time pull-through spatial revenue sample, PhenoCode will and scalable and panels utilization, and development on accelerated the in The signature optimization signature assay per and will reduced HT. deliver

to instrument our compression Akoya’s already and to analysis to XX-fold data ease QPTIFF. transfer analysis, pivot reduced that file now and of via This by technology sizes remind standardized file but from novel format image terabytes And file and gigabytes. on processing enables data software leveraged to platforms proprietary called you, and

deploy ecosystem providers. Rather than singular strategy solution, develop spatial accelerates partner and rapidly software third-party This format of the of development also is simplifies monolithic software a standardized and a growing with biology solutions. to Akoya

markets especially and rapidly supportive the development new dynamics microarrays NGS, spatial This adopted technologies parallel biology seen Similar other market. true of of cytometry now like is in and certainly software the to and solutions. flow spur happening in is

already software a range have partners all customer market We and across needs of full to platforms the of unique support segments. our

QPS. open others and leaders emerging like Enable compute. and commercial providers have VisioPharm, Medicine source established include and solutions on list software local new like PathAI, of industry Indica The free source partners, that partners Labs software open the and cloud-based both have and rely rapidly and source We and open OracleBio we growing

leveraging roadmap, and this or and markets, to Marlborough. are downstream in ABS the addition Lab In rich several CLIA the PhenoImager product progressing Advanced our we translational at HT initiatives BioPharma Solutions clinical

recently partnership We assays to grade clinical of make in with autostainer end-to-end possible support use clinical Akoya for a assay full announced will and workflow multi-plex their trials. seamless Agilent’s a for spectrum Omnis clinical a expertise leverage Agilent to biopharma. multi-plex

channel we validation trials, and With leadership Lab grade Agilent’s assay and clinical Omnis, clinical support CLIA development, multi-plexing, in clinical antibodies technical use Akoya’s can and diagnostic and our a CDX The development HT expertise, together of creating leaders platform, clinical in multi-plex and Agilent accelerates and our a combined respective global Akoya, parts. strength for subsequent one-stop commercialization. in for shared biopharma companion two provides programs shop fields,

ongoing a milestone companion aging offering. clinical advance Our trial their furthering agreement exclusively co-develop with yet and in another and with our targeted spatial important Acrivon diagnostic signature continues clinical first-of-its-kind is menu to for Therapeutics to oncology a commercialize

In to and with in made pharma continue gain in clinical large expansion We that will XXXX, partnerships biology new developments progress and see TAM spatial of the to traction and pursuing parallel, robust existing XXXX. ABS key partners. significant continues growth

continue pleased spatial expand our quarter year XXXX, this commercial financial strong summarize with performance year To full leadership position very biology the as we market. in our are fourth our to we and and

As we outlined, we’re following the focused in initiatives XXXX. on

and NCX as First, for continued improvements. spatial imaging best-in-class platform biology. a Discovery drive Fusion PhenoCycler adoption the

speed deliver in the further pull-through. full an Second, continue drive increase portfolio workflow to instrument new and drive and across applications to improvements

research we’ll leaders third, continue to the centers, diagnostic to with diagnostics. translational of adoption CROs And HT, medical clinical and and biopharma, PhenoImager the partner drive leading

efficiencies we’ll on operational targeted personnel path our lastly, drive achieve more to profitability. And investments and

to call discuss I the that, Joe? financial now turn Joe to with And our over results. will

Joe Driscoll

hello, everyone. Thanks, and Brian,

As Brian revenue XX% XXXX million, XXXX and revenue year growth record fourth full was over the QX quarter year highlighted, was $XX.X for million, a growth over XX% full total of $XX.X the XXXX.

Our us confidence across base customer performance meets multiple XXXX that a growth environment increasing we the categories. a portfolio despite strong and a market with verticals challenging in are broad high that strong a in of gives macro extremely needs revenue

$XX.X and year, quarter includes and for reagents was over XXXX. growth year revenue, Product XX% instruments, fourth for full which the $XX.X million full software million the representing

Instrument were full revenue quarter million strong a total for another PhenoCyclers with PhenoImagers of had full XX XX for year total instruments the million over which from and sold, and year PhenoCyclers installed for includes instruments, PhenoImagers. XX base year, the full the was representing XXXX which We quarter $XX.X and instruments XXX with growth fourth We were the sold and $XX.X XXX XXX XXXX. ended portfolio. XXX XX% of

a As the XXXX, XXX have of start Fusion full base the now been an number installed or the instruments in a of we over few years. total of have of year standalone from is commercial The reagent metric, sold instrument. next as because of drive combined PhenoCycler pull-through important upgraded the XXX directly a at this shipped total Fusion for significant system yearend and to combined launch is increase either a system combined combination the units previous since projected PhenoCycler

the China, our XXXX, impacted Europe for quarter XX% the for lockdowns million $XX.X reagent XXXX. in fourth COVID million we over $X.X experienced FX was revenue and headwinds representing revenue. growth In full some and year year, Reagent full in which

and over X an and mid-$XX,XXX offerings pull-through for to project consumable as as pull-through instrument range times the our several along to PhenoCycler we running, much per PhenoImager in the more next X PhenoCycler the upgrades. new of up annualized times With increase rollout with are as the and Fusion years HT, by the field instrument significantly

the now with to Fusions already of microscopes. phase during With for PhenoCycler in we using PhenoCycler’s which the are are pull-through launch for significant researchers shipped projects, increases have trained noticing and third-party early actively compared the been

throughput and base As is researchers expect further to to installed continue more. impact expand, and of the to trained the PhenoCycler in expansion continue pull-through even fully we Fusion acceleration become application reagent

but pull-through panels, meaningfully new revenue are to optimized share we’ll to signature through XXXX, and The also higher wholly and as of PhenoCode rolled PhenoCode Akoya contribute only the be offered out highly panels ready-to-use. will increase plex not reagent which time discovery answer, accelerate throughout as panels will our

per annual the growth We the our commercial a stride approximately continues of revenue reagent innovations continue to and XX% rapidly as for expand. next hit base target to years new several year installed

revenue increase XXXX. of and other million $XX.X for for XX% an year, the and million representing $X.X full the Services totaled year quarter full over

BioPharma Solutions, as and clinical Lab, we such partnerships Advanced to large Our significant gain other with and Therapeutics meaningful also signed CLIA Acrivon Agilent. traction continues throughout XXXX, pharma

in Gross profit was $XX.X full of million the the $XX year, quarter representing XX%. million fourth year gross for full and margin

CLIA We trial these margins to enrollment, a Lab Service as continue clinical we grade to which build near-term out the impact support make investments in capabilities. clinical has on

experiencing. on margin inflationary cost experienced with most pressures, are other what consistent from have companies We impact also some

throughout With full $XX.X investments we commercial software laid have rollout and full on partnered efforts million panels workflow. the $XXX.X quarter throughout end-to-end groundwork the expansion for of PhenoCode the year, for year. million for the field business for clinical discovery the upgrades significant expansion expenses the Fusion, to the PhenoCycler XXXX, Operating and totaled a

XXXX the next targeted highest the generate plan as a to years. for areas over that returns includes will create several making investments path profitability Our in we more

cash quarter $XX and additional approximately ended We in of the with securities capacity. million $XX debt marketable million and

to take growth to as ensure to capital needed balanced maintain a exceptional continue our We throughout accessing approach XXXX. we

awards million fully of including XXst restricted shares as shares, of diluted totals are impact options $XX.X Common outstanding and December unvested million. $XX.X stock outstanding the and

for We million $XX.X for and million in had product we the year. largest instruments, industry. XX of XXXX The and the now demand over launch Fusions XX% in the XXXX, the portfolio XXX the of robust XXX record-breaking revenue $XX.X offering. instrument year shipment throughout instruments have another a growth new full prior year quarter total the instruments with quarter, sold summarize, this demonstrates across the since installed base first in our To XXX

Akoya’s current platform we confident continued new featuring deliver publications the XXX as ability platform in product XXXX, of year-end with our with rollouts. XXXX to in Now our of remain very growth and adoption commercial

this highest. At to spatial having range revenue with we the XXXX $XX for the for consistent QX we guidance lowest revenue that of business million project tailwinds providing having are a market. as biology seasonality to see million time, continue quarterly QX and $XX with our will preliminary be We years and prior the

closing back it turn I’ll Now for over to Brian remarks.

Brian McKelligon

Thank Joe. you,

year. year to We’re forward new performance. portfolio report a throughout to executing partnerships multiple strong and across We announced and exciting full pleased quarter the the developments look and we’ll them

We’re discovery excited lie fellow Akoyans, solutions shareholders. support the and ahead clinical thankful work our that deliver for for the positioned very hard we the for well and remains Akoya about spatial well dedicated as from markets. opportunities of our growth we’re to new as the customers as of the

will Operator? And at open questions. call this we point, for the up

Operator

Our Instructions] of [Operator you. question Sourbeer Thank the from first of UBS. comes John

is open. Your line

John Sourbeer

thanks for year for the Hi. taking Congrats and the the finish on question.

Brian McKelligon

Thanks, John.

John Sourbeer

first any consumable just year if through think what’s and really guidance dynamics mix adopted on how how you embedded? the Fusion those utilization of think in have started of to do that half XXXX, hit customers think XXXX, the and just about XXXX at back And Just there? customers guidance, look embedded that the about then most instrument on that now to pull-through you in these the or full and the what’s we color do

Brian McKelligon

you’re the clarify referencing Fusion? new those Just of customers second to your PhenoCycler the have part question, that

John Sourbeer

Yeah. correct. That’s

Brian McKelligon

Yeah.

really launched number. and recognizing the a in terms really that with on March, ago we’ve guided that me shipping say I on in XXXX aggregate the would Joe the I Let started to-date guess can we throughout give take second year user bulk that strong qualitatively PhenoCycler year. of base, the really in with we caveat what part the only performance

user quarter, if stride of it PhenoCycler how would assume takes. sometimes full yet customers people Fusion given we of average a and for in the to those sort running, don’t So long I majority at get you it up too probably say takes just have

full in on users of total of sense. if halfway the utilization that terms total but that that throughput have number, also those sort average higher than and given in makes average that pull-through. the probably we’re And number there less system on the you Does aggregate sold, that impact we’ve then resin

John Sourbeer

All sense. right. makes That

Brian McKelligon

Yeah.

John Sourbeer

And follow-up. I guess just a

cash color the $XX then just Any plans? year You ended around with million cash hand. on burn and in potential financing the any

Brian McKelligon

Yeah.

question me targeted capacity, bit about million year less to XXXX. Joe hand Let with Joe Joe, first that, more $XX burn. talk talk your revenues higher a to part with chance noted, debt on $XX of then, and cash investments and additional a give million little I didn’t Yeah, again, a on as the this on

we’re really position address little you’d more solid but you now. a if So question around cash can any also John’s right XXXX color. in Joe, like, there, and add a color But bit additional

Joe Driscoll

Yeah.

your answer think I spot on. on cash is

Fusion. of guidance categories. that In $XX and about year next build we is think the on the million, roll down individual reagents, But and as to way by we there out the don’t for we a running customers the guidance million break the products, PhenoCycler terms get more year, be new for $XX throughout up the more as will example,

that’s reagents. So XX% growth the combined with what instruments will you pull-through the anyways. being in quarter-after-quarter, us I target hopefully gradual as number our internal increase could get think that number increase that to think That’s a of we about for sell, that

John Sourbeer

Got it. Thanks questions. for taking the

Brian McKelligon

John. Thanks,

Operator

please. moment, One you. Thank

of the Canaccord. question next Kyle Mikson comes Our line from of

is open. line Your

Kyle Mikson

as Great then Maybe question. Yeah. financial start Thanks multipart follow-up a look for the year. questions. Congrats question a to Hey. guys on well. the outlook

I it’s mean, like I’ve So for though, I going on more. what’s you like, actually, just Joe. mean, I that mean continue on stopping sounds years, really few heard to I boxes customers feel point, XX,XXX from I increase. using the a to said it pull-through, mean, last still, your

Okay, mentioned, growth then be as can XX% would this kind like of least remains good going think just or you XX% of have XX%, pull-through kind just with in over And -- range? I mean Joe, consumables increased I instruments accelerated rate I Thanks. and if and recently. that at this think do would well. you XX-XX of mix forward kind that

Brian McKelligon

in pull-through, get do growth? are I the think, -- saying the we So how terms to reagent XX% you of

Kyle Mikson

Yeah.

Brian McKelligon

that... Is

Kyle Mikson

other have does some to based the on a predict predict XX,XXX Is yeah, a on is to level? based it expand -- or higher

Brian McKelligon

It not amount. tremendous would a to have but expand,

mid-XX per get instrument, sort That mid in that about talking range we’re the So will get instruments you -- of instrument. combined increase low you’re the $XX,XXX instead range reagent numbers the of about. of of range, $XX,XXX the per talking with kind number that out that there, will the

So it’s instrument as generate from hangs of long not in kind in number number like as to XX,XXX it to mid-XX,XXXs that go the has XXXX to there.

Kyle Mikson

about Okay. know should to-date, Brian, of going usage mean, the question, customers what’s what’s up of part coming though, of then, kind cranking like I increase my pull-through And was boxes. but out the you been products first that new some like But these on the... just have that preventing forward. from the really I of

Brian McKelligon

somewhat back honest the If annual you Kyle. basis, you keep granted look -- contaminated are on me and of numbers here just can Joe on sort if an by COVID. these historically And

go And back we’re so up if PhenoCycler you or see to went think users XX XX. that around pull-through starting XX. beyond go like amongst for the PhenoCycler now XXXX, from on third-party to XXXX, the customers scopes I the

it. have attached already PhenoCycler A the It’s minority you just So XXX look seeing that a are matter, out there. Kyle, to we’re trend. that Fusion the as across

for the already number PhenoCycler. overall to into that’s pull-through starting impact So the mid-XX,XXXs the

in or last to to that that impact call. to what gradual up for FUSION, climb we’re manner So seen And we more Q other… see begin XX,XXX our happen the a where just articulated was starting the so already pull-through that it we’ve historically coupled to on one

Kyle Mikson

Thank.

Brian McKelligon

quick… other One

Kyle Mikson

Yeah.

Brian McKelligon

lockdowns total revenue. in COVID the and … reagent our hit calculation is point, that’s of pull-through reagent the in did XXXX China part revenue

$X that if obviously been higher happen, So plus million would didn’t XXXX. revenue reagent have in our

Kyle Mikson

kind very Okay. Bigger ask Thanks, will top picture, a follow-up I one question, here. of guys. obviously. No just

at great getting are kind of a like -- great quarter in obviously aware of are and a these front the products placements, what fourth by market. fresh think did with buying You I of seeing recently, that But customers deals? I’m ability the in anything guess, least your at or quarter. terms Imager XX a are Is kind I of distracted you is that few in think, you of -- potentially the the end kind had like customers folks look kind launch slow close impacting so of doesn’t nothing of these down of Imagers. to and get I

Brian McKelligon

good a It’s Yeah. question.

the not because the our at Imager is So with and Zenium the products, the competing new instrument really year fairly COSMIC hasn’t reselling it [ph], impacted and they’ve Zenium Cosmic, the performance throughout launch a our been that is all. of pipeline The event, new.

the the Kyle, think, compete in clinical to competitive that’s the largely segment genomics not all impacts still I we any really we’re feeling them. way but through discovery discovery, still where from side, translational within and given and

we we and participating more as segment, competing. think, have on genomic and think launch in directly we’ll I our more I color might be we because that, RNA more Now more that start

Kyle Mikson

is that. a Right. last Thanks part Yeah. lot That for Brian. important,

Brian McKelligon

All right.

Kyle Mikson

it. hop guys. Appreciate off. to going Thanks, I’m

Brian McKelligon

Kyle. Thanks,

Operator

One moment, you. please. Thank

line Carrico Our of Mason Stephens. next the from of question comes

Your line is open.

Mason Carrico

Congrats reagent during Hey, quarter. the starting for strong question. Maybe on a guys. Thanks just with XXXX. revenue the

the think if some came that quarter? XXXX. out in I factors what on slightly we and were But of than out out expand incremental in called I Could modeling. QX dynamics on continued have color those XXXX? played revenue this any any know that weighed on just lighter in fourth I played during guess it dynamics specifically the you you in of some

Brian McKelligon

I a of little of you but lot talk Joe, a there’s Joe contributing those. that. Maybe, factors. can address bit you can Yeah. mean, to

Joe Driscoll

Yeah.

softness was held spending. The think we’ve in kind China, talked I in through issues, Europe pretty with from problem what QX, already. currency some back that of lockdowns much about it’s some COVID a QX

QX, as seen volumes it order one -- think definitely versus don’t rolled QX. into was I so pick But up any we’ve we’ve thing. So

going think I So we’re reagent fine terms performance. in be XXXX to in of

Brian McKelligon

then And is there still...

Mason Carrico

it. Got

Brian McKelligon

a still but revenue within there’s each bit the year. prior realization quarter, of from little Look, certainly the on almost also lumpiness the comps in

Mason Carrico

it. Got

Okay. elongation an been and XXXX the purchase Perfect. year? seeing macro of Thanks. as you How time kind has environment, about in guide, in it? And are conservatism you around baked that on about any lines, thinking dynamic capital the we still think this are

Brian McKelligon

be we and So was I’ll manage China. about Joe really in that did or make EMEA. dynamic comment other the and reagent albeit a Where a forward. approval that that even impact not. purchase did in as a looking XXXX, have then was in just to saw of on. to anemic on some add talk capital back still strings and we material concept cognizant quarter coming can timelines expansion we It’s But it didn’t have we’re revenue, including slowly fairly But we the

any we that. color? want do think add still I contemplating you to Joe, more some of

Joe Driscoll

Yeah.

presumes things massive a of not I turnaround economic the kind in are guide environment. to terms what of that we’ve XXXX overall be macro guide. given right they now in we’re guess overall, are our that anticipating Just, going

keep that. kind our basic obviously we’ll eye So a on that’s But assumption. of close

Mason Carrico

it. guys. helpful. Got Thanks, That’s

Brian McKelligon

Mason. Thanks,

Operator

One you. please. moment, Thank

line from Stanley. the next Tejas Our Savant question Morgan of comes

Your is line open.

Tejas Savant

one Thanks Brian, things the Good kick you. time maybe for Hey, guys. evening. for off to here.

and stand things do where X.X scheduling, than done other to be remains rollout. for Fusion the what So

that And it throughput follow-up samples. midpoint? the XX Joe, do when said you XX to is a in the that done into of to your expect be to is X.X increase I the Fusion field then enables, sort you extent think you to that, think, To upgrades? those at as what guide XX from baked in with I mentioned expect to And then, start by XQ. that

Brian McKelligon

Joe I’ll So first then how guide. that about can part talk the and take impacts that

upgrade just is of it, field being sort development. that. with of validation the a X.X quarter. work final, of sort the associated I So call verification of there begin would some stages final not a next was risk any technical that There’s will And

methodologies. development standard again, product really So,

reagents, going as X.X meet Fusion the the and for And carrier, to just and for also reminding RNA. noted is some requirements you -- RNAscope the the also, in operating the improvements multi-slide that commentary, for software the future to but

QX. happen will that all in So

terms than the want good of whether as studies. really shortest that’s -- for would the I It we to In as Obviously, do long six it and be it say, take depending question. will customers, a or fast maybe upon we existing longer can. little take, could would nine that, months. not existing it preparedness would bit customer a interrupt months to how

Joe Driscoll

on what is baked question your And guide. the about into

at wide And really, So low of on in the going the average. there’s on average per mid-$XX,XXX we’re instrument really looking $XX,XXX to very mix, array a do from Some little. customers that right?

Some per $XXX,XXX instrument per year. are doing

where So right that’s sit really seems from what’s we achievable baked and right into it guide the now very now.

Tejas Savant

Got it.

on sort then And Okay. the PhenoCode panels, similar of question really.

course at the the sort discovery upcoming guide on year that as AGBT, of here? factored like launches of the You talked much side. as the over the there of really strong traction How well is about into

Joe Driscoll

$X about you’re million amount. tremendous a year. guide, talking the the of It’s whole Not $X a or certainly but part million for

Tejas Savant

Got it.

helpful. Brian… the That’s then on And multiomic front, Okay.

Brian McKelligon

Yeah.

Tejas Savant

in eminent high that version of the is the -- panel how when I on again that access And plex going terms co-detection first Can … that you do is you just to of sequential rollout. protein early of this is us panel? remind go plex then was expect sort access, right? by sections and data, XXX believe to early get could be

Brian McKelligon

Yeah.

probably like we’re for sections. make services, sort high-plex XXX that to we’re will earlier. multiomics market, out, sort these debating early have with again, comes boxes or do you in time we on sure come the just about, protein will it the that, and again, start not But, commercially have whether high-plex the or of as by not the still want do RNA access we to we noted, ready of we serial sequential, we’ll whether as So because via we talked

In terms reasonable of -- scientifically cost limit there’s on the also think upper how sort and high of no a but there’s can limit. limit, we a go protein, we

I scientific and as RNA think we I XXX think as the So you just out comparative right think And pricing. by about much now. need and discussions been there’s others amongst as people plex between community plex is comparison, think about

that in of the a value, RNA protein scientific sort of say, a terms be, commentary direct can activity. there’s given of And equivalents that measurement X/XX of

into for think we will kind and is going multiomic. to stay of and somewhere versus that be while we’re then where RNA serial similar a range XXX-plex protein the then So probably

Tejas Savant

I can of Got I around sort to And your a a by use $X back where XXXX? approach taking think a OpEx million-ish year? or we to $X Is That’s bit investments. vis-à-vis think it. was when Joe, about just last than your around XQ run helpful. you $XX mean good targeted that for more OpEx rate put guiderails you benchmark Are higher little of any you to million. then, sort comments million there were

Joe Driscoll

Yes.

to throughout of say, number of spread sort we’re would I So, massive going the not year. but people people. hire a be It’s going in to XXXX,

something So I quarter $X.X something think year, throughout goes like maybe in that. each up you could the and look like it QX at then million million $XX

Tejas Savant

Thanks, helpful. Appreciate Very guys. it. Perfect.

Brian McKelligon

Tejas. Thanks,

Operator

Thank you. One moment, please.

from Our line Mark the of next Massaro of comes question BTIG.

Your line is open.

Mark Massaro

question. a the for you strong Thank year. on guys. Congrats Hey,

the a drive is Can the there I’m of not to like does but don’t to X.X. the X.X. if step-up guess result And I’m to some determine what about instrument clarify significant that? new looking then on I So really believe economics a I guide curious been respect to is products. as trying relative the PhenoCycler asked, economics a look you of Fusion you just has comment you’re could lot that incremental with

PhenoCode for so in fair is And from panels. $X perhaps it million contribution new upgrade, in to Fusion PhenoCycler you’re modest negligible appreciate X.X about to I very than say $X that million on a other contribution your in commentary all baking the revenue XXXX? the Joe, But products

Brian McKelligon

I of is think a Mark. -- -- some the lot it your Maybe part. thanks first for question,

-- and So with the and the same the is shipped future future versions X.X. of X.X, and built ASP the without the versus then the with

of -- then… a on not So your the there’s that X.X, we’re not was instrument. the question increase And if because price

Mark Massaro

Yes.

Brian McKelligon

Okay.

Mark Massaro

Yeah.

Brian McKelligon

rollouts accelerating continuous really And throughout panels, it’s you year. the of terms in an centered additional can to all are over are quarter of then systems, and of that beginning And realization these these around and partnerships NPIs, this time. software the upgrades see these

the pull getting outlined are think maybe back I single that low the these current to the the low and from you that XXs outside have of here is a its pull-through really all improvements cetera. et to So quarter level drivers affinture XXs, thesis we’ve the to of

framework this so to internal unit these do partnerships, answer. can faster within OS or time, software drive per you So continuous sort improvements content, more Akoya workflow, of is from to time to samples the to

binary event, single over So is realization in rather not but time. the aggregate a

Mark Massaro

makes That Okay. sense.

Joe Driscoll

Hey, Mark. Yeah.

Mark Massaro

Yeah.

Go Joe. ahead, Sorry.

Joe Driscoll

That’s the Brian add it to just basically are pull-through. that, come. to and To where itself in what on but reagent generate that helps doesn’t really said, dollars, but seeing upgrade going the X.X of dollars

are necessarily that products not higher upgrade -- a delivering it’s it’s drive that much new revenue, us revenue So level. to but is helping that the X.X reagent

Mark Massaro

correct? just And to XX% target this revenue year, Right. clarify, reagent is approximately that growth

Joe Driscoll

Yes. Correct.

Mark Massaro

push and pulls have the other seeing contribution. some your companies tools that. really we’re services But seen between We’ve contribution razor/razor sometimes case, blade not the in Okay.

last growth in you services drove strong a year. So year-over-year XX%

perhaps a challenging you’ve would qualitative you XX%, comps? rate target historically, Recognizing think, the there in services did of XX% other that suggest why to XX% that than any is reasons that talked likely are about any range. factors moderate growth I to just just

Brian McKelligon

kind can I then describe in of a… could that you Joe, and take what’s Maybe,

Joe Driscoll

Yeah.

Brian McKelligon

the around Lab specifically. commentary specific … Services

Joe Driscoll

Right.

Lab, we focuses our We’ve early on is stage projects more for that very CLIA on That’s PhenoCycler good doing another been I’ll now So have well. some to comment the large projects. Brian so going XXXX. projects, which second are services services let lab discovery a and bucket going that. pharma year right got that in have in is What really

also in have now we that revenue. also bucket, And we CDx --

So this signed is we the Acrivon deal that XXXX. in

You’ve the more will be of got we is things get like the for deal. doing a that, but in piece our in XXXX, that milestones XXXX and that revenue, Acrivon

pieces the three really those So services are revenue. of bulk that

be growth should for services. another XXXX So good year

Brian McKelligon

go -- to Mark. as promised, just again, back then to And

way So as included just that that’s of includes because also achieved were through groups early biopharma all includes to. to our it Lab the the explain also partnership Services drive and as translational Acrivon, that those Service services where we year studies success that these with realized clinical adoption much, the revenue both so that a milestone-based Mark, the in that’s doing these also and trial number why working But have and alluded really the in throughout revenue helps through Lab milestone-driven within milestones has -- of we last that year, grown this of efforts. Joe those

Mark Massaro

you’re for nicely pick seeing in me. think, I you here say that Excellent. Okay. QX. I Joe, up volumes last heard one And

can good doesn’t at year throughout about So there’s issues just orders of seeing But customer forecasting a like course with funding a the not or with having any the to a to the and budgets or It maybe respect off reagents you’re huge necessarily start. whether challenge budgets? level. are you’re speak conversations to seem you

Joe Driscoll

seen back that, hiccup COVID We control. any lockdowns, things XXXX we be unusual can’t we really other issues things other than have is Really, normal. not which seem budgets with and fine really to had like that, the than in only budgets. like to But

Brian McKelligon

And Mark, the or XXXX -- part this funding last of lot year relative discussions what biopharma around emerging really a lot of a around year have biopharma is smaller the to commentary and latter the macro XXXX. of -- what the been

of on customer comments two really a that. not And meaningful base. percentage That’s our

biopharma We’re of muted. particularly tremendous multinational has COVID mostly seen have with a R&D kind their in a spend, dealing who as surge spend

not commentary biopharma not I impacted the really restructure that pharma don’t really is us. think small So has

HT like like our CAGR, pretty funding where XX% a darn XX% been pharma in their up And trials, system. got particularly trials large of -- we strong, it’s in terms which oncology, again, all clinical of where has play something is R&D really with clinical you’ve

Mark Massaro

sense. the Excellent. Thanks That all makes color. for

Joe Driscoll

Mark. Thanks,

Operator

moment, [Operator Instructions] you. Thank One please.

comes Piper Westenberg Our next question David Sandler. of from

line is open. Your

David Westenberg

another on when -- should clarification is about or how on is ramp? about one talking guys. and base XX,XXX that PhenoCycler are more in the Just solid that total on just the a us we about Xx, Congrats talk that guide. you the base Hey, or base just with the that print Fusion give entire great think the your… they commentary have Fusion or that. sorry, PhenoCycler Xx to you Can what ask color you and going to I’m a Joe

Brian McKelligon

Yeah.

So..

David Westenberg

… there. commentary

Brian McKelligon

Yeah.

over and X about we’re quarter-by-quarter whole process that’s But commentary really to process talking is building Our multiyear a or several that a a times this X year-by-year. year commentary period. times

Really, them many transition converting customers the whole key really to fusion. get buy the to those were continue overall process possible a Fusion. PhenoCycler partway just as from of that Fusion as to a PhenoCycler customers a to number encourage up That’s through PhenoCycler to is

really the that’s piece a of So equation.

year, get average, And if to the Fusion, multiple numbers that’s to on of But shift per those majority years how we get PhenoCycler get year. take per to it will of $XX,XXX there. of, customers you’ll $XX,XXX a PhenoCycler kinds

Joe Driscoll

David, make amongst PhenoCycler that to our total sure, user the that Just average is -- growth base.

Brian McKelligon

Right.

Joe Driscoll

Yes.

David Westenberg

Got that up I -- because much, how actually about that you it. to you came thank Yeah. part very number. That last with part last what was exactly going is ask

Brian McKelligon

Yeah.

David Westenberg

So I appreciate the color there.

almost goal then get from the just Now terms the of be could we to to of -- of adoption we penetration this in the be placements, percentage that? close are seeing terms but adoption one assuming you and wouldn’t rate I kind retroactive that What’s microscope? this in are go? can far penetration have the the of can XXX% who it rate? to all or Is where about you PhenoCycler part, I’m of do mean, XXX% more them? how more part And talk you of little

Brian McKelligon

take then color. part and a bit Yeah. Joe little last I’ll more give can that you

won’t use to very probably but some all that really time, are of are forward -- that’s the it of some user base where amongst existing our XXX%, percentage pretty see right, preferentially terms because there customers. and the of to a that’s small -- going there be to go kind total. kind for of we in labs way microscopes, are attachment penetration that third-party new speak You’re some a are the we decreasing But over the a going Joe can

Joe Driscoll

good. we plus buys initially buying at coming XX% every a PhenoCycler, attach XX% The the when rate, often how really it rate, are a say in time. Yeah. It’s at now. Fusion XX% attach right they mean We modeled It’s we same rate. or and attach somebody time

think customers I of buying see the two instruments really value the together.

we what PhenoCycler people there some that’s from -- going of but people. the the be minority we can only tell, to still so without be Fusion, buy And a will who

number So go to for is with a I now. XX% think good

Brian McKelligon

XX% before came the halfway or now had less total PhenoCycler it, customer the And there. then I’d say, out, of we’re base Fusion for the existing directionally, installed a base, call than has XX%, David, maybe XX% the so, Fusion. that

headroom… still we have lot of So a

David Westenberg

Okay.

Brian McKelligon

upgrade to … customers. existing

David Westenberg

rest I ask I’ll the appreciate. you. Thank offline.

you. Thank

Operator

moment, please. One you. Thank

question line next Tim Our of One. Chiang from comes the of Capital

is open. line Your

Tim Chiang

also more think, Brian of the pull-through, of a business. there X.X? Is a lot terms you I have benefit Joe, to of about expect thanks. yea, how over reagent business your when side the Well, a effect that of convert reagent will of Fusions kind just as launch new the this lag in the of the with ramp and questions Fusion the impact been X.X and

Brian McKelligon

Well, introduction. product there’s new any lag yeah, I with -- mean, there’s always NPI a effect

out doing initial customer of in it’s so happened for standard, pretty run quarter, instrument an buys cycle coming in assessments I and for utilization much say productive then QX standard the the their quarter, pilot because kind real years, to they And and get in this quarter, first second typical right? third lag, into instrument, start use, and where That’s instrument. formulaic that the of the XX an a

So that is a lag.

see to our as starting given now We’re Fusion the pull-through Fusion the pull-through PhenoCyclers PhenoCycler total it have on the than realized higher impacts customers alone.

real. that certainly most So is lag

cycle new very that assay then you adoption any or application an have on system itself. with And

ready panels to an you’re dealing applications was if probably So because that with that’s instrument right RNA. new grab is new generally that away or those shorter, it

about time of So, yeah, over lag all build is we’ve this talked why there a effect these. That’s amongst of pull-through.

Tim Chiang

And just follow-up, Brian. Great. maybe one

HT beginning how the at of you sort what have Agilent partnership your do meaningful will have with you partnership year, -- will on do this signed instrument? the this impact it think of You PhenoImager think

Brian McKelligon

externally, necessarily the something already and the they not that That because happen. is table that The with is support along impact to on to expertise that’s of we’re they seeing on be that we expertise our the implement impact our quantify That’s the that partners projects workflow leverage will that’s Yeah. because going an going workflow that to be clinical pharma the impact. first and that expansion bring of and And the HP. the HT.

a Lab it’s going should pipeline, in HT also service result in galvanize to Lab these itself, the result CLIA system may for because as additional both -- that Now projects for more our launching, in Services we’re but well. much the panels the business, that it robust new

Tim Chiang

for XX%. just it. question. Got number And last the sort pretty that wondering a year is of mean, Joe, sort of Gross I around how as that out? and starting just progresses rolls margins XXXX one good profit

Joe Driscoll

that, that number is XXXX. going Yes. in up We would project to go

of One the margin reagent for keys getting business. gross is more

about here That’s higher. going we talked driving percentage today. projecting did that a key reagents we’ve in that margin what really lot the XXXX. we’re are better But gross So we than to to do

Tim Chiang

reagent the Right. around are business And margins right? XX%. on your gross That’s

Joe Driscoll

Yeah. Mid-XX%s. Yeah.

Tim Chiang

Mid-XX%s.

much. Thanks Super. Okay. Great.

Joe Driscoll

Thanks.

Operator

to I’d this back no showing to at call any the I’m for further time. turn questions like Brian McKelligon remarks. closing over

Brian McKelligon

of the just yeah, we’re hour. Well, the top at

attention, forward support to we their look each of you. wanted for and I following to their thank their just everybody with up So time,

So everyone. thank you

Operator

you. you this conclude gentlemen, conference. participating. Thank today’s does all for Ladies and Thank

You great may now disconnect. Have a day.

Akoya Biosciences (AKYA) 6 Mar 232022 Q4 Earnings call transcript