AKYA - Earnings call transcript Q3 2024

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Operator

Hello, and thank you for standing by. Welcome to Akoya Biosciences Third Quarter 2024 Earnings Conference Call. [Operator Instructions]. I would now like to hand the conference over to Priyam Shah, Head of Investor Relations.

You may begin.

Priyam Shah

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

the A Financial the have and On the available third released we on Chief September for the today, Officer; XX, press ended Executive is XXXX. financial Brian results John of Earlier company's Officer. McKelligon, Chief website. quarter today, copy Akoya Ek, call release

that performance materially forward-looking to statements statements include call or XXXX. relate like factors. I'd remind that future during to or the Act to are statements meaning this make federal the are from call harbor statements implied Actual in a expectations Before laws, to or we begin, of forward-looking may results Reform of those of forward-looking management you Securities in of statements. the Any the within which expressed will Litigation differ provisions this Private securities of made safe variety that predictions due results, contained events, pursuant

list any of filed and Risk performance. factors, statements information be XX-Q a will our of and this I Akoya's guarantee events, risks to or risks and archived And turn the to of to on aware Brian. are filings under of and in This projections will future section XX, call new in as the in the with update the any our because later whether are live The with over and time-sensitive We today refer that the please conference contains Akoya that, section required Events. or considered including consider intention the except Commission, forward-looking today, broadcast obligation, the identified information, only U.S. today, financial future business, November Exchange now call and with accurate statements, urge a you not these uncertainties XXXX. revise call November disclaims Securities Investors audio these heading the to website is be by you should Factors or estimates law, XXXX. of the or only associated otherwise. portion as description For of XX,

Brian McKelligon

Thank good evening joining to you today. us We and everyone. appreciate you, afternoon or Priyam,

conference an performance the positioning at company third provide overview advancements, call, long-term and aimed I operational today's decisions highlight for products, During our will our recent in growth. of quarter, new strategic partnerships, our

Following that, the financials, into delve Johnny will for trends, our and outlook key our future.

market. challenging $XX customer quarter's this revenue revenue midpoint XXXX and year, million $XX full-year sciences is we and margins a a delivering ongoing temporary efficient First, the been third outlook see spending performance. our implies challenges return and life readiness long-term success largely and operationally growth enhanced anticipate believe important expectations, for growth. offerings. make excellence restructuring, let the that said, this and us solid that expect That center while list has sciences step-up a current below and with foundation implemented cost these to We and the strong Throughout quarter purchase from in our optimistic to pressure disruptive, constraints and tools million. a now a difficult Revenue temporarily continued headwinds. imposes. seen the across worked comments. which, addressing our year due challenges our improving introductory manufacturing product capital thematic to positions of to a We reagent built growing of and an have more to to some we macro the throughout on the of these environment fourth range expect for in was organizational for right decision new industry and in absorb long-term me structure are minor incredibly We actively Akoya came the equipment the in the we quarter our remain The market. of life year

companion and advance it biology term. We and in the to is research value reference largest future of publications pillar a diagnostic current be where a theme a We of will pipeline as and market, our the Conference, believe Society biology or lead continue spatial date. installed believe SICC, that for to point Cancer a a that with in was base diagnostics. near to we our the supporting significant most growth the spatial market we've and the week's of was prominent Last sciences life and Immunotherapy seen strong contributor

the spatial benefits to of until rapidly margins, end profitability manage spatial the our more that of platform have confident of leader a being biology biology. discovery our supporting diagnostics, be from We are will remain top-line Because our in growth. growth Akoya we remain From realized goals. company beyond, in and to potential the consistently dedicated market delivered emerging we growth improvements high ability to return and in environment. cost and solid to a market We structure the committed XXXX the preferred through today's market to XXXX, founding challenging to the achieving top-line and continue solely a in the Technologies and now this we

XX% XX miss the XX top-line revenue the total a Much Let first and the prior the was where third was million $XX.X in the decrease quarter. second the revenue now versus through revenue of to quarter We walk our We of me XX numbers. in quarterly for instruments year-over-year compared period. in top-line year quarter, quarter $X.X million. in by instruments, the third placed driven reported

reduced and the in extended $X.X XX% million, over North installed base especially year other Akoya's the a increase market. of prior prior a million, margin year and total excellence. a are year line, of volatility an top XX% byproduct XX.X%, Gross Operating funding, instrument XX% Americas fully the on the instruments, now were decrease increased year, our Reagent totaled Services an million, result driven an in $X.X sales. with year-over-year. improvement center is to operational prior from prior loss prior Even XX.X% our the revenue a increase the operations X,XXX was limited expenses noted, primarily is driven by the As the underperformance cycles period, our manufacturing totaled on primarily revenue sales by period. the over equipment XX% a capital year over over and period. from $XX.X decrease improvement and period. underperformance

and the million the PhenoCycler-Fusions top-selling markets, XXX Our the loss XX% spatial from or studies. with We supporting for in mid-plex proteomics combined discovery analysis a throughput translational low- to high-plex both PCF, quarter over the operations was the year platform improvement $X.X million, and prior ended period. $XX.X high industry's tissue

systems total now HT HT just PhenoImager Our or XXX.

that publications clinical-grade a XX% total HT from believe biology Akoya the volume, forefront for having is path of the on year. system quarter, As prior in the of regulatory impact spatial the a the technology X,XXX establishing as reached patient care. platform a continues truly as can lead technologies of citing we publication to increase the approval, a our at market third

last month, and introductions. partnerships we the important announced several have Over product

program breast, years. cancer Success what announced Let Foundation the in do and of of me at which to Royal and certain we Toxicity these October, over understand Marsden study briefly Analysis The patients Crick stands side X,XXX and the review those. Immunotherapy all effects new drugs. patients immunotherapies. in Francis titled MANIFEST, In bladder, identifying ambitious NHS the who and drives skin predictive better to will why not to to of large immunotherapy U.K. least Evidencing multi-institutional a Institute has Features for four patients announced or do This initial their the include respond Trust multimillion-dollar goal have and subsequent early already biomarkers the testing cancer started X,XXX Multiomic response treatment the kidney, that

the additional was and ultra-high of Atlas, spatial value, now and Atlas introduced Humor scientific were selected out on origins proteomics increases week's we revenue, manufacturing Eric that PCF in which offerings. several This inclusion to center programs platforms Akoya's evolution to prominently their platform and platforms revenue PCF the as the X,XXX utilization, content and in major this the these which samples. HT of are in Ground cancers Truths. spatial high-impact the and such produce for heels visibility, analyze new meaningful At individuals the driving robust high-value last as excellence, incorporated now publications to chosen study. media solutions in spatial Akoya's drive affordably the his across referenced, also the by popular reagent I Cell Akoya's previously pull-through. as proud SICC highlighted the ability only Networks, proteomics and our Topol nature from product initiatives meeting, HubMAP for XX featured Human preferentially adoption, leading outlet rapidly of have Tumor Akoya have and platforms of were plex recent endorsement, reagent a We system large-scale were engine profiling the of our the with and is which Because stream a strong platforms. content trace

are covering First, meaningful Based of samples pre-optimized, off-the-shelf at adoption an biomarkers high-volume we global the on driver slide multiple time. is SICC, promote whole to organization proteomics IOXX scale actively key the and our pre-validated no announced will with translational and on contract platform that development a we utilization. now of IOXX or be solution, for the customers, interrogation incorporated our announced XX enabling of choice The they of per early dedicated single that PhenoCode Precision tissue and industry-leading panel immuno-oncology will protein panel. a from is the panel, -XX samples quickly our panel begin discovery also HT, ready-to-use IOXX as partner, feedback resolution. setup that the an researchers At IO adopter positive PCF Medicine, a have and projects With discovery and and large-scale SICC research a panel and spatial and high PCF little can tissue panel. and confident an

and to a panel insights Second, for preclinical and academia. drive immuno-oncology translational applications for optimized XX-plex biopharma research Akoya unveiled both new mouse

experiments. Lastly, Akoya or ability catalog their molecular own biomarker high-plex to simplify with will routine supplement more high-plex expanded additional customers' enable our XXX plex our molecular own of spatial rapidly panels. These interest easily panels our develop barcodes PhenoCode barcodes markers ultra-high their to of

continue to strive will fast We routine, XXX-plex and affordable. to make

development me updates the transformative clinical significant at late-stage business emerging business Now research core and this updates momentum the segment. several let on in we some announced clinical we are business, we now moving year, the strong Akoya. Throughout have on provide from building our

September of Phase registrational accompanying intent partner, trial in at HT very First, our had Acrivon their promising the first ACR-XXX and Therapeutics II Acrivon Society could I and ESMO on corporate and companion with event that partnership our a assay lab. encourage a OncoSignature results, CLIA update the the you to deployed our on showed biopharma of watch promising Akoya diagnostic. our yield our launched update. ran out therapy They XXth incredibly confident platform or full increasingly European is commercially R&D Medical get Oncology to clinical would September

prospective also partnerships our only our reagents risk add realized, be of demonstrated therapy for significant shareholder Additionally, have early-stage meaningful this later Immunoprint of administered and personalized independent aspirations. market, demonstrates in earlier rapidly melanoma a multiple Immunoprint CDx system Along with in potentially is from year, NeraCare data yield the the at TAM companion clinical coming of assay in through expansion to to high-risk partnership clinical patient has diagnostic studies. Should performance value believe our that these clinical significant that enable opportunities Immunoprint exclusive high conjugate therapies. we partnership benefit pipeline melanoma. the as that melanoma with be in the suited this antibody-drug a patients to capabilities has early-stage expanding been as We selection would and key NeraCare's usually HT key years identifying therapeutic group options enablers. a potential the with announced for represent stage. our retrospective ideally they relapse This robust our realizes driver and Akoya would revenue current

Our priorities remain clear.

to and menu at First, revenue margins. continue adoption, platform expansion and content system growth improvements increasing utilization, drive implement efficiently to

Second, advance of and partnerships. pipeline trial clinical and companion accelerate our diagnostic

goals. profitability our meet to drive Third,

that, shareholder financials of alternatives identify strategic now of to evaluating part more I detail. discuss for actively value, the growth, will range to to Johnny? company and long-term the a commitment ongoing profitability, sustainable turn our best path is As in With maximize also call Johnny success. forward our the over to

John Ek

Brian. Thanks,

compared placed a to million for prior period. in period. Product the field of as As million, XX% quarter. compared the instruments, Brian quarter a reagents, year-over-year decrease the third totaled XXXX Instrument the highlighted, $X.X to was revenue year $XX.X third year revenue million this including total totaled software, decrease XX $XX.X prior we year-over-year instruments for revenue, XX% quarter the and and

our XXX delivered combination instruments, We totals field, in other revenue PhenoImagers. in $X.X an quarter, of XXX a year-over-year our of $X.X the in the on Our prior PhenoCyclers due now million manufacturing in XX.X% PhenoCycler XX.X% in The and margin there industry-leading a to include $X.X the and decrease revenue and optimization services. to period. on is the instrument reported and the compared gross revenue this in service and million of primarily the and in million totals period. quarter X,XXX quarter, third HTs third the investments in million XX% to a Service The margin the XX% for This year-over-year underperformance the period. executing including XXX prior was our operations year the Fusion, PCF, instrument the capacity now field third are increase sales. the in XXX year result addition leveraging efforts. base year's field. in installed Services increase warranty totaled Gross decrease reagent reported from recent lab is from year full $X.X prior

in expect we increases year-over-year third as compared million revenue drive were million margin We Operating in operations year XX% XX% expenses expand were these the mix prior million reduction. a year-over-year from operating our efficiencies. $XX.X the period, reagent period, realizing gross decrease. Loss our $X.X the the a quarter to in to third while to million $XX.X continue prior in $XX.X compared year quarter to in

million implemented efforts marketable year, Throughout shares optimize ended XX, stock quarter and which operating $XX.X in our cash, unvested has the company In shares streamline cost-improvement efficiency, summary, gross and our long-term for the success. short-term achieve this critical diluted options September enhance enabled of outstanding fully XXXX. the changes margin these made we improvement, balance for impact year, of securities. are proven throughout operational XX.X approximately and successfully the have awards, challenges have the we positioning of as outstanding Akoya to for restricted advantages. to while to noted, Brian us year. ability As and Common shares, costs We cash million including the equivalents, cost drive with

to range of this a to encountered range year constrained million market, versus we've challenges revenue full evolving to the in the the of million. year, expect be $XX a including Given we XXXX for $XXX million end million $XX now prior $XX

constraints. efficiencies expanding the throughout has drive and year margins bottom Akoya line Our in to operational improved enabled gains an with recent top-line

Our in to to opportunity improved long-term of opportunity you, with belief a to profile, forward evaluate growth, coupled the alternatives value. expense profitability, path Back success an sustainable maximize best the provides for to market long-term and identify spatial range in Brian. strategic shareholder

Brian McKelligon

for for drive throughout continued the our our customers will the you, shareholders. strategic thankful hard for point, the the forward up and as Operator? fellow Thank executing dedicated We're look questions. of Johnny. this at on of well Akoyans call objectives we of We financial as work and the open year we to And as business remainder our forward. the support

Operator

with [Operator Our line first comes from Instructions] of Bonello question the Craig-Hallum. William

William Bonello

give quarters? sense the you of there several your what the no burn the can quarter burn statement a was was cash cash John, flow for next and and in the expectation then over us

John Ek

drive from cash to that top really to So ability ops QX. that the $X keep range our of but million from million line, while ops mentioned, didn't $X we on allowed as achieve us for sort to cash and margin gross in burn

growth in expect That's the full realize assuming that number. really less and to in of effect continue a it sort that's start expand about. to breakeven return OpEx as we've to be midpoint that guide low year. into the an we've digits into really but that Likely to of the as expect achieve profile from it we that going reductions to flow start to and see spoken And revenue we haven't place. expect year, that, meaningfully able set we cash new cash is and we a next be margin QX We margin to we year, we'll hit a then won't EBITDA single put way it to next exit revenue to out adjusted breakeven have in to into we 'XX. as the this crest see But cost profile of the talked then up we ourselves able be

William Bonello

capital And is just terms in anything of you or expenditures? upcoming meaningful there in the quarter had

John Ek

We of are behind of No, excellence. finalize the a the year capital us. bit QX the in primarily build-out center expenditures and for really our QX spent to

a not of And QX. lot CapEx half and in expected the not the so in there's back year, meaningful not lot in a QX,

William Bonello

And kick basis. December in can you just payments I XXXX in your of on remind think principal monthly then us, start a maybe to

Just size us? that for

John Ek

sure. Yes,

closely to continue rework we amended financial some our our work a to that recently agreement So lender interest-only with and and covenants out push bit. of the period

And that actually I/O March 'XX. now of in is so

a to look And in it with continue year. work we out that push we'll quarter partners now. closely from as again, debt the next So our at

William Bonello

of you're off mentioned a alternatives. you maybe both anything exploring of You the in strategic if range explorations? Can give there's those a table sense us

Brian McKelligon

around just maybe bit reiterate. of to context little So that a

So got ourselves a us think position. just talked value to the around top the foundational And color like a the we and articulated, in we clinical the it, put solid kind we've of Johnny really with the line we market. a long-term even that I line we belief position some to when And securing the the to of coupled we tried way in spatial about XXXX. commitments bottom robust made at that having through growth put really the that about of all as solid script, as constraints feel showed establish look statement we in end opportunity, in we really the think really high as

no, off got responsibility fiduciary So these we're strategic company, table. and in we've being evaluated. nothing the to, always public a short, opportunities. there's as say I obviously, would constantly also evaluating And a And are,

in absolutely heightened. is. so environment, this everyone And current And that's market

question your table. directly, is again, to So no, the nothing off

Operator

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

Mason Carrico

to top over guess, last guys given reaccelerating continue around level need of would you to, or XX incremental months? And months you've pipeline, line to confidence and momentum? that driving investments you I adjustments things just the were made what year XX really talk improve, made if the competitive, think be next the to just the fuel next cost Could do your stay

Brian McKelligon

Yes.

we as a think to I where areas, line we continue. and expect look XXXX product of on into kind growth have basis confidence

introductions around think is I company, content. priorities recent time really the instrument a pivoted our as and our with commercial reagent first the sales we've

the And so manufacturing byproduct of to of I/O XX, the a that mouse you of really some new of the the center product panels, excellence and of and saw introductions announcements is of come. more the

So really into we get on we become application-driven XXXX, think as we focused selling.

growth top very pretty particularly half, kind of on a sort conservative make I with not think So is surprisingly strength. And to the the expectations in more we've instrument strong top that contribution light of robust deliverables throughout pipeline. to probably going number Area made area then at in we as and is reagent that's even two and where revenue we metered, instruments growth a look build we as weak we'll trial clinical that installed number XXXX to having for think line, be really will at look historically. continue low comp. growth And first instruments, of productivity, XXXX, a X, into of at on foundational meaningful base a incredible than progress our

'XX. in Mason, in would, top-line order to of growth it I those in in map contribution terms out So that

Mason Carrico

this can I quarterly just instruments QX bit mean, revised And below you your year? then, expectations a little a trends Brian, about I fair think is amount QX. the in in talk in guide

incremental us changed you Or competitive has there? during So can give color frame? changed all? at Has what the environment any that time

Brian McKelligon

region-by-region in-quarter what look on rates, conversion And we sales interesting. we've of and quarterly and QX seen volatility really looking really historical cycles, It's a sales rates. across metrics an on and those what relative are to a from a metric-driven. Yes. to quarterly-by-quarterly you region its each that And to basis. it's on And of obviously, to at basis QX at cycle incredible basis amount is try be across QX all conversion

the So what's challenging predictability. that is really driven to

baseline that. look we've is do what on at tried America we've quarter terms areas the the points those points those cycles, And so the volatility, in low the been to as sales look the of seen rates conversion this and it's in look really environment. challenges most of And within really low primarily at of academic at you really North the and where in highest

I So gives color, some you competition. it's hopefully, Mason. that wouldn't necessarily say

the do look at I additional our numbers. that. That the at those really Lunaphore. XXXX we see I across say as colleagues and think of off it volatility into look as would out And But to there QX of is volatile the competition at we is do macro the quarters from is you baseline overwhelming look macro at and that driver. those what we're trying said, average

Operator

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

Kyle Mikson

market largest the it here much that to I so that this Is you factor have Like you possible it's guys just of as that spatial. return in -- guess, so cut with you've is the difficult to installed to a very made it's well? like you Brian, playing that base workforce? penetrated big, the growth

Brian McKelligon

really think areas Now, capital a and peer And all. it's challenges primarily in aperture pull think saturation? equipment question. a in don't good terms you back not the question. just just across a in reached It's like saturation question. and at we groups point. if funding others, I a of NGS it's It's Have I good the look

think Kyle. saturation, from far So I we're

Kyle Mikson

looking the just in financials, just X maybe then lump I'll at And here.

then flat increase basically beat pull-through the that to then, quarter-over-quarter, needs mid-single-digit guidance, to the seems. mean, like to consumables, And $XX,XXX remain if like So flat if service math like decline instruments I'm looks right. guidance like pull-through decline, quarter-over-quarter, continues remains the I based mean, guess, on and it on I doing I

there that side be thorn new is bottlenecks a So It stable the the pull-through getting years? I are seems a to everything the to be what up all expectations of just far? so over that are for Why And the launching and driver continue ask, kind despite question 'XX? going to does offerings in years. what the second line. wanted after to service your And What's big was there? then in on prior Brian, your growth

Brian McKelligon

I'll the a line, let some some number. to Yes, of and Johnny that we But but step just deferred, that as maybe of And a QX the you'll we of line service service QX, to portion spoke speak pull-through think, on rolling reagents, are respect our with in services. the XX-month clinical I see up basis. was about, calculate in that

think, the a just we out But I trends, per a just down reagent at, sort reagent in QX. we to QX terms QX. were QX because of here was million down step quarter. in and terms under to around QX, the we QX, through little then $X how up of at started example, X% to the dynamics robust with of we numbers. of generally last those is challenges, where the bit reagent for the $X terms as and in It's And where declining quarter. revenue, million, year's relative just exited you pull-through. in really Xs XXXX, and And a of $X of start we don't a kick the it's slight And temporary of think, QX, mid-to-high underlying stocking along back in we're I QX, in range, look Kyle, other availability That's relative volatile just per range in There in of compared quarterly was mid-X as look QX. we've that in step pretty the millions think slight dynamic, per was as in we trend, QX were up quarter. so into it we're revenue million QX. And cycled

John Ek

just Kyle, And I'll in. jump

On warranty as instruments that the line, the services captures parts, freight, spare the services software, a perform, we lab reminder, for sold.

every year so recognize is defer of first service. price when sales of a that And sold, over and we instrument the portion it

in And that to lower recognized contribute that QX, we baseline then a the service would so get instrument that as for didn't through year. had number example,

So of early expectation lab on think of the and because and that as lab QX, revenue we expected. in I with back still derivative factor some as it's we is instrument really see mentioned we a QX in Brian QX. an mentioned, pushed And the that line service the half, services in that

point, Brian's we sometimes a really is as in a It's well. in to that step-up QX. a some really bit all lumpy So of as bit that those complete That's of service contracts there.

Operator

from Our with next David comes of question Westenberg the Piper. line

David Westenberg

because Did you about that QX? in less flush, you have there about talk sequential And step-up discuss So a have stuff can maybe effective QX are of any in aren't just in maybe first, just to of you might in But talk some went flush? the from go pursuing in impacted going that's stocking QX. just diagnostics. did can you into budget you then QX see clinical And reagent that about I QX, if and then maybe as rental think budget to for that expectations potentially a outside see QX? things know you we a models? maybe how

Brian McKelligon

Yes.

see a and QX we as question did to stocking exited QX. little up some So yours, I into think and we bit Kyle's

the first on instrument And that terms in you theme. It's then side, QX on we're sciences than instrument. external more to I for drive of numbers. our as That's internal do more you think people is tools markets. of half throughout a got helped in think are through David, was as we actually part from feedback that I QX. that, start manufacturing sort see that reagent of look typically reagent sort where rentals life transitioning of and direct we we customers. not something that financing often some the behaviors large discoveries we of QX the of common the And at And terms your external seek a of from of our

David Westenberg

help Just we're month, and You just what the some want going coming looks a actually I I maybe it. -- next us around sudden, cycle you then competitor us maybe mean, mean, they a can had see the give customer cash. still on or of sorry, customer, They're the color middle? of it sales to get you stopping just seeing you this? like Is coming some categorize kind a all around. something are

cycle? there just is purely mean, in kind you've If know but quarter? I if then how you categorize of given book-to-bill, trended past, the extension can it, And actually as out? as this far in on of don't the kind I dropping never of the of Or that maybe color of sales some just length that

Brian McKelligon

Yes.

let some specific you So metrics. give me

at the we a As in grown from call look about an terms opportunity. it's cycle, sales of conversion a ago, taken by of XX% time length year it, from, our of it's

And are So as about America that's That's error true EMEA. you bars there versus bit. a across North all geographies. accelerated here think

been straight of goes in quarter, an those which is length XX% where that that's thing not the the you it rates plus elsewhere. minus, availability plus is baseline kind And in that the America, in to terms time to of particularly get you have convert. it incredibly months then that of the that date the call extension conversion of of that in actual the or securing you conversion has other rate, funding, what's variable So is X close? probability if volatile, a the of opportunity funding, have overwhelming And been North

rates directionally year. And some our as are as the those trends in that peers sales terms of with consistent look some at the the cycles metrics So last conversion I the geographies. across well and that's of look you you different probably think over at

David Westenberg

question And the is into more But a thinking in to I And the constrained is way get and Kyle's help I of with on the actually And hunting have maybe profitable, thoughtful farming talk you're I that of And X,XXX-plus consumables a bit I this terms pull-through? you're and do gross margin like of of this an how and then a do thoughtful being kind kind of with structured? that obviously mean, and curious very and all. function capital the your force am you by about spending. that some better function mean about can to farming continuation have what you size of way company. because up just there a just is function? maybe instrument ability growth a little sales

Brian McKelligon

Yes, it's question. a really insightful

sale, from as platform, technical where conversion think into now instrument to are and is of that's biomarkers company you're you a targeting so an instrument I immune-oncology we So have a an talked market a sale in migrating, selling a about I researchers. and of the XX panel application-driven market and our an those

You have panel targeting a in the in you're preclinical models, pharma. groups mouse

those you're and You neurobiology panel have customers. targeting a

you're and is on back sales So identifying our together, talking basis PIs to now, go question team about, our on a where an commercial right all farming areas to like your basis. inside sales reinvestments researchers farming generally commercial that tie that that way. the and would these set And the across into likely and up therapeutic something territory you're function be

qualify and to pipeline, it's to off reps. an those cost-effective hand to incredibly then the to sales leads, So drive territory way

of also So with sort pivoting both more kind in that we're is how approach. line of structure strategic but commercial our efficient, economically the that's underlying

Operator

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

Tejas Savant

cleanups in quarter. just elaborate XQ it sound sort release in CapEx a disruption much just Brian, couple a gotten on like of in the Can was pushed versus due had made shortfall the remind press the the out of from then to little you that a I want you bit come guys of to some those us The pressures played much also expect a latter dynamic through with you on for And how year to from RIF? how the contribution Johnny. Can earlier here quarter? the shortfall. one the of milestones role fourth start

Brian McKelligon

Yes.

That contributor, of So said, question, to the restructuring, of does capital. do you that challenges think dominant we the we've you're just meaningful correct overwhelmingly discussing, first it was when present the org. the part across as the availability been

coverage, North expectation as would instrument American say get but in of say, Tejas, particularly and were certainly want part territory at I contributed. you the would there don't within reorganization, probably look some into basis, just reagents the false shortfall So that -- pockets the precision, to I this about of down think that and of I XX%, which a you're as sort talking of through we year, of selling reagents project-driven contribution was because XX% on you're maybe settle the from get the I remainder will solidify.

John Ek

Tejas, I'll just jump in. Yes.

to in sort some in visibility we is proof-of-concept good of that in to. So we contracted work have business work do that line pretty lab, our in our a addition services funnel that type reminder ongoing

that contracted million had spoken work. a dollars And land. So couple we it's will that about of

We expect confidently. is pretty to that We QX complete revenue the land and work the in quarter. in

range would I what have. is say $X $X million we to in So million the

Tejas Savant

out in sort for sort NIH, America, levels budget from RFK or put on then, may that spot nominee the I Secretary, especially the do do here. news at the called the you that North Brian, the of what And with But at he election be NIH you this academic are what to for think the assuming of weakness, HHS think mean staffing not implications outcome, especially stage gets does think confirmed? you you

Brian McKelligon

That's is tough data speak know. can that I I to a and really guess we existing all question. the loaded

NIH terms this budget, in XX%, at in outlays, that's and in cash it's a month but first of look X. up the You month it's typical u

X% X% I we historically, RFK to to prior was Over I think think back as look a Trump's can't it the I term, speak factor. growth.

right that's can now. I back all bank So on and lay think we

think the I most I that's say. could

Tejas Savant

last my here, sort guess I it's a then X-parter. question And of

AltiView as around one a issues sure and [ disruption First of well. sort through and on pulling with disruption of purchase? all, trigger degree They've hesitancy customer I running Visiision are mean, lived that now at I'm and any are created company, ] NanoString a the into of you

So customers themselves whenever a ecosystem. a and into on on, company of impact evaluating that tying about cash situation have an is relatively limited runway going can midst feel options sort that how strategic in the of has

and sure part of And see demand the either larger believe times that But right, biology today, do second another strong, spatial first then that's or guys, forums multiple is a it to perhaps. eventually. the is back as earlier really, entity part will well as that still part. the as parent So is question around is you day, come Akoya stand-alone that Brian, you've mentioned making

you see when you sense any share to far color process are So resolution how that in can that of some options? might And on front? we on along of any evaluating strategic get

Brian McKelligon

very very questions, I'll those latter Look, the take fair important and first. and are

to we but we those what the that path assure our our signals said probably the those is that and like remove customers we've reason date signal, company I employees, a why have a can our is we're to most think concerns. confident Akoya to that shareholders,

Tejas' But think there which put I that's the statement you of don't extent lightheartedly. I that. out address can

only do confidence. so with You

statement potential X, part I one. that's So Part think on disruption. completely And around there I get there's a your impact. scale

it's going mean that we area I not our forward, you opportunities been have doesn't performance really hardcore impact. at litigation, decision-making part think material have of now bankruptcy to that's as something financial to those least determinant. would are a risen think it, it's and our current concern. we have company, the historical events, not of as absolutely right an but position, process, when has our I customers' say not a at visibility something look like our That I we where

of So that has scenarios think the our faced I market don't we're historically. at level some of the

Operator

the from Guggenheim line of comes question with next Securities. Subu Our Nambi

Subhalaxmi Nambi

stable we this were had has in-house? instrument. ask Is margin macro to the And product place gross half environment. Is discount the mix this you've instruments in in companies challenging instruments reagents the the in if wondering your maintain of because ASPs to in have given are other to manufacturing improved to bringing function I placement a of able been year. this for what part saw this I'm Your light? of there first space that

John Ek

ASPs. Yes, continuing we sort to stable consistent are of and see

QX, Our ASPs place that hoped driven all put margins, that impact of to happen, by really the are for not and we're something the we that's seeing in the planned moving realization. things and we in materially realization and

make towards in impact internally. there's Certainly, these more of But will and margin. our it reagents As on stand-alone and naturally, basis, we current as and consumables, a strong seeing But mix your the stable instruments, we're reagents, you we've manufacturing it even, an the a as and scale quarter, what lower bring of instruments. able to in-house of does difference really anticipated. we're reagents on margins always have absolutely, sort impact that's

Brian McKelligon

don't one of view. you kind more if I would add longer-term mind, just

tightly of to reagent working out into put introducing what going As help new certainly margins. coming we offerings help manufacturing, on get our capital. in-house also to being control XXXX It's able more we much to begin and inventory, going

to on instruments of now agreements, also are our XXXX, of into of renegotiate here, working supply the we what capital. kind also on capital some give instrument improve As we've the selling throughout us challenges manufacturing historically to face that the an will in looking the opportunity XXXX seen

think term. two to we additional things So look I about as longer think

Subhalaxmi Nambi

this level play stay heading I are back it at right? you, the expected I to Can margins into gross that to XXXX. hear Did

John Ek

we the factors then XXs and year-on-year basis sort point sort couple going the would improvement we've the be year of of the of by always what in that's low driven a sort future, see into thought that communicated Yes, highlighted. we Brian exiting of that hundred

efforts to to as return of year OpEx ultimately growth bottom we So in see gross OpEx, took visibility we throughout pretty part have line and margin us on good revenue. in the margin to the to and allow and

Subhalaxmi Nambi

were this Brian if That's you PhenoCycler for PhenoImager? it mainly it on was Or of or the PhenoCycler dynamics see franchise them? it more I'm because dynamics, competitive at. previously and or on the where only Johnny, the you what I this that hear is all reagent But did focused I responded you PhenoImager? ask to. getting from

Brian McKelligon

antibodies. was the reagents PhenoCycler It the in certainly most

we period their of where larger they're panels, they on up accumulating stock non-continuity them. to sort out As were supply, their the building of as people ensure had panels to of portions they are during the were trying looking

here sit today, we're order comes shipping to if Now X an as XX out X all in we antibodies, days in for complete.

dynamics dynamics prior the versus the current were those today. So

Operator

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

Mark Massaro

ask are certainly more from challenging been applications any to market for again. market that the in it what in pressures I there understand that some biology. want guess I Maybe research questions you, spatial? Maybe like, capital seeing instance, I I'll have conditions. was within competitive about, to there broadly Brian. spatial you also competition or you other for first Are dollars But about just proteomics? ask are the introduced product recently NGS in extent competing for

Brian McKelligon

in order. Yes, it's reverse question. a those I'll take good

for areas proteomic dollars core are from shared somebody people CROs, Akoya head-to-head competing platform providing in versus So like services, spatial competing else. you buy labs, or I are that should a on

because different are competitive certainly most exists dollars. there So that a is and zero-sum dynamic, that

the a area our For sign we revenue, at core to is meaningful telltale and one look contribution of for dollar labs would as that be dollar. this that's of weakness us, been an year,

in we terms dynamic, I content. of content. the That's in are where competitive potentially where In the with discovery have a PhenoCycler-Fusion would investing say don't side why we we're head-to-head losing is

application where the where systems, but do ready-made. to So is is probably fierce. only we areas pull-through most content existing not is get drive higher on area the competition we an That

competition, the how to terms have sold? more many we're overall funding it of the point would environment. get the back doesn't with to we facing to if there I the of where units us respect it's terms In contribution minor in Mark, think, no headwinds were

Mark Massaro

know your XXXX. Some press as Board nominated release him. has quarter ended of put differences if of spending, out since Board. that coming and perhaps And the Scott like him cash changes I noticed of hiring? Mendel to I know of the just level. about Chair maybe be the the on quarters perhaps flow any ask you at to as not Chairman I or the we and respect the breakeven or consider guess expand whether there after why with change Scott targets, philosophical could part could here want shortly Many us you guys you been us the

Brian McKelligon

Yes, I There's philosophically. asking really no question. appreciate difference you that absolutely

team, I as great a great we leadership have have a Board. with and the we dynamic a think Board,

positive. getting with for company has operator Scott that and through tough Those like environments getting this, efficient a that multiple personally in times. long-standing operationally Scott multiple got to Johnny, be are has an been me been has who's to proficient, for bottom relationship think environments times, him, experiences Johnny your and your been I and through navigating line become

lean navigate So a Board and on our been really and involvement desire this through times. signals active through really Akoya to this to of member help that a challenging us like leadership's these indicates the personally company for has scenarios him

Mark Massaro

target Johnny, at clarify, the to you a to Just breakeven your hit sense you heard year. give I now as think likely that going us to you're of can not funding I cash what say for flow end happen? I to a Can see extent that XXXX. think in To we you to growth you And you when then do return know need to guys to there? recovery in expect get this

John Ek

would breakeven year a mentioned thought the at Yes, QX in we previously we had we point. exit

QX, cash it, cost we a revenue we so call want don't guide, expect speaking when specifically quarter. we But at It's the there, that. to that would it heavier for we where we're is the really of we put it's right QX think where appropriate not be, midpoint to think do the but side. we have the quite naturally, we get Given

the A sort as next year, still our I big start as the are stage single-digit If or mid- inventory mentioned reminder, the company haven't think a quarter always statements, that I quarter, you I this So that ticks capital. exiting under back EBITDA knew working naturally, we exiting through mid the our bottom We inventory. to year. where turn that I I two is and many adjusted up QX instruments still sort line cash the adjusted and flow see of The at target with sold even have that's case with movers the for is sell view. past cash usage we then year. to cash quite a positivity of as low until start of EBITDA into to of our sort with to

to because any now. and 'XX, right can place, specific I in into cost a confident quarter structure speaking look I'm I target I have So that to get but not

Brian McKelligon

for in first return that, assumption external QX, your we question returning growth, to an reliant year, funding. like making a incremental opportunities is our that fundamentals QX What lab on our next we're To services over to of some we are sold meaningful that for reagent and not on growth relying factors where example, boxes. on half are continued on in performance, XX growth,

Mark, in at it. would we qualitatively if how shape QX were would So to that's that look how look you up, order, at

Operator

Brian the showing I'm gentlemen, further to in I for remarks. to back would the closing like questions and turn queue. no now Ladies call

Brian McKelligon

know through, you us it's Thank environment. with to of and to We complex you a question. a up We look collectively. your we I each chance and following all appreciate individually forward talk your challenging appreciate market you giving for time. and this

your time. for thank So all you

Operator

and today's call. you gentlemen, Thank for concludes your this Ladies conference participation.

disconnect. now may You

Akoya Biosciences (AKYA) 14 Nov 242024 Q3 Earnings call transcript