QSI - Earnings call 3 2023 | Quantum-Si incorporated

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Operator

Good day and thank you for standing by. Welcome to the Quantum-Si Q3 2023 Earnings Call. [Operator Instructions] Please be advised, that todayâ€™s conference is being recorded.I would now like to hand the conference over to your speaker today, Katherine Atkinson. Please go ahead.

Katherine Atkinson

Good afternoon, everyone. us. joining for you Thank Earlier today, ended the quarter results released XXth, XXXX. financial September for third Quantum-Si A the website. copy the on of press release available is companyâ€™s

Executive anticipated.Additional certain Chief today and remind I Federal you me are cause information Securities will Hawkins, involve within of to and Joining material these be the management entitled making differ risks of actual could results Jeff statements that would materially section or like Jeff These statements Officer.Before Financial uncertainties Chief laws. Keyes, from our that and uncertainties we those regarding risks forward-looking the appears to events begin, and President Officer; meaning press in release. Statements Forward-looking

the This XXXX.Except made revise Exchange by of companyâ€™s Securities statements. company and more only call is today, conference or the November filings Xth, forward-looking as obligation to of a For list see and with Commission. complete time-sensitive live update broadcast any as description disclaims accurate or required information contains the any that intention the please risk law, factors,

Jeff non-GAAP GAAP. to reconciliation included we the I financial in Generally referring prepared filed today.With or turn also release Accounting be earlier in measures is measures financial US that, most will financial the directly During this comparable call Principles are call, accordance that these will Hawkins. with of to to measures certain Accepted not A over GAAP the press the

Jeffrey Hawkins

outlook business remainder todayâ€™s financial present XXXX. Good quarter for we Katherine. our and Thank you, an a and of us. you afternoon, everyone update, the provide performance call, joining thank will provide for In third

Quantum-Si goal sequencing next-generation lab, protein to to questions.As We you will for bring the then are is aware, everywhere. every the open of line

take diagnostic of insights biomarkers, and technology that during proprietary of first we that an wanted opportunity discovery the during progress on ultimately have scientific accelerate company believe will unbiased research, on CEO. health.Before new impact the significant and as the power enable therapies we to our the that my updates tests quarter, back year progress development positively proteomics a will the sharing new deeper, Our look to I human as made delivers

have we roles, Chief of launched Chief Financial first Operations Vice President leaders President Platinum, our proven commercially Team industry Commercial enhanced sequencing platform. with First, the and key Senior the including worldâ€™s Officer, of we Officer, across Product addition Senior Leadership the next-generation protein of Development.Second, Vice

the is capabilities was R&D one scale.Finally, we diagnostics life through an insourced. and and provided our Reagent or R&D largely performance. all manufacturing customers Third, projects Independent completely augmented in team, that This we continually most. and model achieve and of and Committee devices, Fourth, Directors, have as of the governance to our Board we should one CEO have three our our strive addition, over to sciences, Directors reorganization from on with medical quality with we retooled a us and biotech.In across has Governance focused Consumable improved we majority cost have that margins completed improve Nominating outsourced of from want as gross greater of applications experience and our new Chair established Board we addition our result control and CFO Independent

progress to would set retaining now months us XX has Overall, XXXX like and shifted of focused a opportunities, near our fundamentally improved provide growth putting business on strong the all a aspects have into We mid-term our technologies. progress beyond.I the update an for foundation investments during over of quarter. in into on of while a past next-generation greater the percentage compelling to investment our a

the to is priority first Our Platinum Chip. corporate XM and commercialize

customers is spanning customer us leads energized their in a quarter, opportunity gave across meet the gaps This the first during the was region research. from from back the in launch in Europe.During on clear participated University remains both team data interest to for lab United protein presented the region. customers the opportunity in XXXX. our HUPO and to we and XXXX.In Our Asia in The in States interested to the and it a with using Pacific this and October, Korea. Pacific that potential From Quantum-Siâ€™s distributors are applications. Busan, came we event and Dr. event Asia South about industrial our geographic Northwestern of the marketed ahead sales continue World see engineering, Tullman-Ercek grow first Platinum standpoint, both webinar, Congress therapeutic in focuses addresses well Platinum in using funnel continues technology expectations technologies, Platinum to currently

discussed he engineering for selecting variants.She for applications barcoding she also proteins. the as talked characterizing that During genotype-phenotype about such protein in for and her engineered generated use protein on they and for proteins of some Platinum they used webinar, the Platinum data presented methods studying linkage was use other plan in to lab, secreted how

workflow Beyond discussion applications of be the of lab for remainder of we the will expect XXXX, time the we webinar customer-generated the specific savings across the has submitted included the manuscript the first that Platinum overall experienced.As also also interests, publication. of look out

it full are launch well we our early current XXXX.Our the to in We second launch with is us in we commercial about building market from position as believe priority to innovation. are will excited the move lead commercial controlled momentum and

key we of our upon we this greater against build to our further technology the to research that accelerating development customers us now team sequencing reorganization, XX% the of and than most.As development. technology opportunities. this product We organizational quarter, deliver from change the our part drive deployed the our the industry-leading our applications and design our team the process.First, biochemistry changes, believe completed programs want we outcomes some near more in strategic last capabilities to capacity have focus mid-term we call. allow Post like and would in reorganized I organizational of more discussed protein next-generation review on share rapidly will and had During we efforts capabilities. to are to

that renewed results we to remain novo from in next-generation investments retained and on the already of it in we this the path sequencing first seeing the technologies have beyond.Finally, confident strong set are We positive in focus ensure to to de a and XXXX future. being focused yield signs early deliver will company are

initiatives.As on successful of Carbon Another launch a program. and that and review, set first of of coverage earnings share goal XXXX. the the consistent of not am the be After the Carbon and to workflow strategic in that library process, of review completed projects with clear several prep impact Version we could work product part research.To prioritized that that at sequencing will to call, advance our our our more end, with prep and we improvements and per all will discussions of R&D the X and which kits, higher these review R&D across to a strategic not commercialization output required customers were that customersâ€™ quarter with to there kit, the comprehensive this expect of could move programs sequencing determined that our forward Carbon reagents library from that of the we of chips to was program, during It overall sample, of in was platform, define Instrument included we the was of time. have a process, improvements evaluate our prior focused implementation pleased sequencing our for Carbon we identified a we review improve from results.I full robustness

we prep provide methods, also even will and sample improvements puts us these towards studying.Overall, our prep customers the full protein on interested greater that proteins types expect sample in we X early launch next-generation and technology, kits are sequencing around We doing a of compatibility range specific Version strong sample compatibility that our with commercial between the are the in believe XXXX. combined work path

of initiated activities have this, ensure prepared for are to Given we we well that commercial set event. a

new more deliver I cadence R&D a technology and against we While to we applications operating set and preserve is new in steady priority that are this the financial well of of XXXX.Our focused early are structure still third the to of positioned throughout in optimistic am projects, strength. capabilities days

we on calls, we remain fiscal have improving discipline. continuously to stated our committed As previous

to that utilized capital runway. to the shareholder have financial we provided and ensuring is value been We our maximize are committed

that Given Jeff to results. our efforts current to-date capital will improvement, confident support continuous review our over can now operations our and Jeff? into XXXX.I remain our we commitment call to the Keyes turn financial to

Jeffry Keyes

Thank Jeff. you,

the quarter the financial from XX%. XXXX details letâ€™s in $XXX,XXX Revenue was gross quarter Instrument results. of kits. discuss $XXX,XXX Gross was revenue which Now profit of Consumable third and was Associated consisted our XXXX our Platinum of and margin third the

stock-based future versus near sales.GAAP Iâ€™ve variable to margin impacted timing percentage while $XX.X As through by commercialization, of in before, as initial work third compared $XX.X be XXXX million somewhat Consumables XXXX. operating the gross stages our the will and mix and for we the be in million, quarter of compared important arrive the an restructuring charges. our are operating of million details an for increase.Whatâ€™s approximate the within items, to of were Instruments expenses also the our quarter total of stated XXXX, third for compensation $XX.X which $XX.X at the expenses reflecting expenses, of these quarter and quarter the operating XXXX is here we change. third Removing Included adjusted were third of million $XXX,XXX

adjusted our at to operating significantly. up we been total commercial year-over-year while have quarter, team operations same for company, increase our to expenses we minimal the maintain As a time, the have ramped able a

based very well adjusted in realignment million capital quarter the $XX.X $XX.X this the XXXX. We million loss for is operating our for that the disciplined million, to to XXXX and penetration have of been compared the operating able $XX.X level for we with XXXX, particular is to year-over-year are negative committing with in Though A to at $X.X do market $XX.X results, year-to-date third looking our quarter R&D was we of most million, decrease. effective capital the of the negative to and operating $XX.X as million are possible. of third million, total XXXX. XXXX quarter our resources maximize have efforts, in to ensuring further period utilize splayed expense compared recent expenses compared ways our of utilization at same commercial adjusted September not And to adjusted expenses.For million R&D on period was the third while maximum efforts ensure to our third to our the quarter in our as as total This EBITDA speed spend enhance XXXX. a time, $XX.X team.Net our our aggressively this we

continuing capability equivalents previously, our to and our of today, initiatives, in the a total to or million we includes September compared put for anticipated on from XXXX, execution and of commercial an we our R&D full blocks of discussed investments realignment be adjusted and in $XXX.X we significant $XXX.X operating while our place guidance commercial XXth, launch As expenses XXXX million expect standpoint building launch Based XXXX. in early cash, million had to controlled marketable commercial for $XXX XXXX. for XXXX approach, in other securities.As cash rest progress

very in our We marketable confident I call provide securities cash will to are over will investments that and cash, equivalents Hawkins remarks. XXXX.Now, back still for existing closing turn into Jeff the runway

Jeffrey Hawkins

Thank you, Jeff.

have of last strategic the by review. We significant during R&D the quarter our progress made led completion

X we We Version and of are quarter mid-term process, including roadmap the and focus XXXX. kits clarity of track product on level the the near this for through deliver our of improvements, excited our including to first launch about in anticipated achieved

full looking build providing to the for continuing during to Operator, on while our X questions. our the to infrastructure call. launch, please the Version up adhering additional open capital our line to we commercial meantime, kit to updates forward our In approach disciplined We support are are next deployment.

Operator

Mikson [Operator comes with line first question the Genuity. Instructions] from Kyle And of your Canaccord

Kyle Mikson

a soon, early each relatively again the you maybe kind know trajectory going placements a like going about really near-term of we couple this makes like stage release this the how launch. to the launch into it we think appropriately this Is to and forward? shouldnâ€™t placements quarter? seems it quarter. given Jeff, expect thinking guess How launch placement sense guys bolus have the should huge couple of and shipment should â€˜XX? and and Or kind we be ongoing controlled placement like uptick or going be I in like about of I this But, anytime start of that controlled a and

Jeffrey Hawkins

Yeah, thanks for that question, Kyle.

things say would I two it. about So,

this next I think year. that for launch through in of end launch early weâ€™re our part controlled a the full year, of preparation as

of we kit distribution-related partners.So a both fourth focus couple the weâ€™ve Really hiring significant done activities of to sort and of be to but the customers, a first and a hands commercial And VX of kit uptick the may launch seeing not of the and sort become catalyst see in some performance potentially the the a quarter. sort catalysts quarter-over-quarter increased really the over to you little last that thatâ€™s in able up that launch initiating in start believe that. full rise. are some scale to We quarters, move the terms quarter after of becomes see what then a in

Kyle Mikson

what utilization from and pretty basis sounds for, the that I has and gross new thereafter. next this XX% lower and Instrument But revenue. then the Instruments. think of revenue revenue coming And your drive thus Thereâ€™s year far. probably Obviously service guess kind Consumables, Thatâ€™s now Service. some help XXs, high most relatively kit like margin is if right is will at been good margin of than like and I

sort roll margin point? utilization up then So have with above out, at XX% see picking year get improved we these as next base. you you kits, gross Could expanding of some install the the

Jeffrey Hawkins

as Iâ€™ll one amount did thing we start do comments. we a was, turn value I wanted to other to weâ€™ve on calls, Iâ€™ll then and here, Jeff maybe over for Yes, of when input machine. about tremendous a The talked engineering built our it few Kyle

little very about the selling next an in even and Consumables, of low obviously over an margins margin a Selling are a your sort theyâ€™re thinking year. our but much of we gross on to earlier we scale, and sort maybe are while at So, course own platform, and Jeff comment Instrument a that. capital, Weâ€™re at bit how of with blend selling stage, how generating of might wants that change it attractive perceived

Jeffry Keyes

to as and more scale, and need the margins scale XXXX Yeah, Iâ€™ll we beyond. achieve bring have obviously, weâ€™re to absolutely as ramp just over the that But we opportunities have add saying on on improvement. that, we of itâ€™s to ability radar to able on in-house, and of going course be manufacturing more to more that up our kit that the improve

Kyle Mikson

types I to like end far? anything about be biotech is generated the customers, you the could hear pipeline respect when almost And about talked things And you know, the like even and like what Jeff about of the thereâ€™s there think for of because a backlog like before, backlog kind think leads Hawkins, share customers of thus kind lot and with of kind kind the to you maybe youâ€™ve like of going that forward? regions, and of excited to so to markets? good

Jeffrey Hawkins

yeah. Sure,

the as prepared presence. into quarter. consistent sort that, remarks, we of we funnel similar First leads to in say, World amount Iâ€™d strong Congress the in in region. tends be our get levels is Itâ€™s Asia heaviest with funnel Kyle we some of first of out Europe.By have what the sort in in mentioned a the thing, the starting of HUPO to second the to US our said direct where funnel have of QX for coming Pacific terms our Still

I we transpiring.So funnel even to biotech work over weâ€™d the we represent terms weighted I over said split, to academic, sort and we the So earlier start markets in the to start and And thatâ€™s and funnel. in traction, the are government market we getting the into visibility pick time, interface industrial the weâ€™re we customers the and as think biggest some first sort expected of more the then of But think government with and that pharma, in more those up be of both of process funnel, continues would further space. and into whatâ€™s but portion majority those our and with the and pharma, seeing of year, that regard.In and distributors get academic remains as would customers funnel the in academic will other the of account. to it customers build biotechs see

can excited helpful types terms pull of types very such. progressing. through to and customers of customers So in see of be those Obviously those your

to excited look as that out So, trend XXXX. about we

Kyle Mikson

users. figure the installed customers And be placements there represent? early with does proteomics then QSI And user these in current in time. like the access program of has new of anyone are new that of those field I base out that then funnel, the like to non-beta a handful initial most over can probably mean, like potential possibly the placements that How many many to or with

Jeffrey Hawkins

the new is of So our program. installed QSI, access were they not base to part early all our current necessarily almost

majority vast net us. the new of those the are throughout to made Kyle, So weâ€™ve year, placements

In of a the terms part not of early having been access program.

Kyle Mikson

before ask wrap one. another and off the and just me Let everything. on pipeline kits possibly I Last the

be, how was explanation is and be on I about in or And I to talked quarter kind it guess, it of not you your going So as touched sounds discontinued I Carbon to know makes well. cards, the going that last was like commercialized sense. guess. anymore

like just is then about legitimate one pretty the does that? completely thatâ€™s and density of side chemistry chips? So have look like of type that this new new be what are increasing is other more hardware upgrade hear in X these envision necessary there the of feel something anytime updates to the or mean, But could I you that maybe soon? to you attributes Or do weâ€™ll Version proteomics rather like hardware itâ€™s surprising.As kits be sort get, some robust, box of Quantum-Si, improvements Is than based for forward, that and not around I mainly that and kind a like, though, type Is features require super that of reagents. question.The or a those. of just

Jeffrey Hawkins

two Sure. Yeah, take questions. the letâ€™s

unlock overall hardware that the the say capabilities Platinum date know, to of is kits, the would continue that now new want Kyle, hardware even year, I current The quantitative of development improvement of early working share also that right do here the are need kits reagent is platform but, and the protocol, to So it what the address would plans really a today.In the through of address protocol on you of can expect really prep, acid we most things terms the E. enhancements and opportunities and focus prep, attributes But of majority to set the input seeing increasing lot we we to in amino launch chemistry the including thatâ€™s or way next terms the new loading.So, XM chemistry, sell the lower with performance. sample proteome. your everything X existing to chemistry data the library kits library in what lot in the thereâ€™s prep, the of with amount really think current what getting to we internally sort on the and set might certainly of run the of Version types. sequencing to to hardware version a know, output, data there, acid chip firm improvements, and grow the sort us the then of terms doesnâ€™t a havenâ€™t weâ€™re somewhat right, Instrument sample library would over combination that their sequencing, some the third versus through headroom of help kit we reads relates are kit sort abundant the have and enhancements have we in next amount portfolio first kit when lot surface around be. the a of like over I quarter which of Platform various requirement sort reagents, you Chip a per chip.So market And and existing of improvements, do types that should the the customer, our of that in sample the from to about surface of recognizer it as we years, is, a compatibility to introduce to the just prep we a get to for more of new see the And coming kit. of sort upon across other touching of necessarily glutamic with to reference, the just the for addition we of influence

that we up So think interfaces what the customer front with do improve might kits. our of is those of to some trying

Kyle Mikson

Yeah and pretty sounds forward solid like to comprehensive I update. look that. a

Operator

comes [Operator of the HCW. Ramakanth Swayampakula Instructions] line from And next your question with

Swayampakula Ramakanth

understand kit. to version is any other? are And second the dependent they are the year. for? out be they full also trying reason would you early other understand, in of the that think just And before one Iâ€™m initiate us planning of trying events sequence the together? at happen So to just on a Iâ€™m we deployment? terms just same next should going each what happen the looking Or are time, for launch launched to to to there of

Jeffrey Hawkins

in I VX RK, the and period we the I say full right is kit, weâ€™re the after advance not working plan move in would launch launch launch. would to at move us in controlled kit, of launch to stay would sort of shortly the would the of that we then to that we now. that full time expect VX some Yeah. would

that, So would that thatâ€™s after move then, about the it right just as And VX think we launch. to I way full to shortly kit. would after somewhere the between

Swayampakula Ramakanth

now? Or or general think in is different And itself? majorly something what mission the VX the different guess tweaking the there later. â€“ significantly going that need you I you is to kit sense in terms, youâ€™ll as be this additional donâ€™t in donâ€™t is discuss it the I to anything But

Jeffrey Hawkins

Yeah.

sequencing an chip. will XM fundamentally the and the run the no, same weâ€™ve and be mix really this this upgrades Chip the have. existing fairly for been improvement them. made customers, Version prep seamless â€“ machine to to No, of compatible itself.Itâ€™s the through. and sort changing the of be not kits library hardware Instrument the X either prep for reagents using kits by Weâ€™re all. the need specific So, The customers very to Instrument that at with impacted is or underlying seamless will be to or is improvements a they theyâ€™ll or theyâ€™ve Platinum This not library same sequencing the software receive go them change really with

Swayampakula Ramakanth

in of expecting terms presentations next data year the the then can data what be something like and what so would current can sort this youâ€™re we year. and deliver? version be And than of of delivered? data Instrument us portray think that, then version should that What or what that data early publications could little this expecting next of much from the it? And be kind Or is okay, to capabilities going can the of itself better sense, in bit be Instrument more a the about, people pretty

Jeffrey Hawkins

Sure.

discussed, we again, kit to the version and year the talked we the be customers really that represents with from end world the the performance Instrument publication script, using presentation of existing of before really of today the generating about the the the some in of webinar post-translational that the expect that the are of Instrument. modifications.But and Northwestern the showing submitted we that The and existing technology So, existing the chemistry. capabilities

that that in more are Version now. expect Iâ€™d as and year, market next into right generated data the year comes the get kits of progresses, we more the data be the coming of kits. beginning that out the year any X in with that the out with And would As

between about versus mid-term gets So, throughout some version near-term thereâ€™s how â€˜XX. But generated would I a and of always chemistry think and with thatâ€™s that data lag the sort that. of

Swayampakula Ramakanth

that be So publications the used the products now. are basically in market certainly can in marketing those right

Jeffrey Hawkins

Yeah, that. they for be used can

VX these share X then, been and of We the immediately internal generate But pump. our that. the of laboratories obviously working to sort some of prime will the kit their data existing quickly implement customers of data to launch part have launch with controlled to turning Version the that part in with as of some

to installed have youâ€™ll So, little start upgraded a more weâ€™re an bring you of base a you going get bit existing running like an in when chemistry when do.

Swayampakula Ramakanth

And the launch. then, about ex-US were you talking

the should here going be is and like be different controlled bit How it way going the because is what launch here viewed a a what to launch ex-US be With a more the distributorship than is to States? on little United that the launch? basis. it Or a is in itâ€™s in through limited is, US typical that happening going the

Jeffrey Hawkins

RK. Itâ€™s good question,

do markets. efficient Europe, number said possible.That distributors when small customer So the the as use capabilities I the we activities, it us is, expect think really in of the on to is again, think as performance make implementation consistency a expect look of kit of at aspect about the of we have type we to employees that many way cycle key the to a giving we and while of and ground sort there with X Version help support adoption our

be countries We select exactly use being havenâ€™t this to would right. thereâ€™ll distributors.I go think then Instrument in new being decided the market of in the I a the necessarily a sort experience expect account. presented controlled launch. may development traditional markets which or Instrument being that beginning, the the expect the Europe in more with markets. when KOL, be reasonable like an early you development launch of direct with distributor place a of we But pickup.So that generated, that placed coming be our And of a defined donâ€™t exists in markets, I by to launch world. at expect some in covered region the region being that sort number say in sort of market reference would would see European it initial either of major â€“ youâ€™ll but a or of conference to with I sales that a directly data being or

Operator

for And that questions. time Jeff remarks. is back our closing we all I the turn have call will to now the the for over Hawkins

Jeffrey Hawkins

our good Thank Have attending today. to updates more providing on forward We look with call. a evening. next for you you, everyone

Operator

participation. your for This conclude Thank you todayâ€™s conference call.

disconnect. You may now

Quantum-Si (QSI) 9 Nov 232023 Q3 Earnings call transcript