Full Press Release Details
Standard BioTools Reports Fourth Quarter and
Full Year 2022 Financial Results and Provides 2023 Business Outlook
Fourth quarter 2022 GAAP revenues of $27.0 million; Core product and
service revenues of $26.8 million, representing 8.3% sequential growth; Full year GAAP revenues of $97.9 million and core product and
service revenues of $94.5 million
Improved operating discipline and restructuring initiatives contributed
to a 16% sequential decrease in operating expenses in the fourth quarter; Product and services margin improved sequentially by 620 basis
points on a GAAP basis, 520 basis points on a non-GAAP basis
Releasing 2023 guidance of flat to moderate growth in core product and
service revenues, inclusive of previously disclosed transitory Genomics headwind; Expect 1,100-1,400 basis point GAAP gross margin
expansion in the fourth quarter compared to fourth quarter of 2022 and approximately 20% reduction in operating expenses on a GAAP and
non-GAAP basis in 2023
Cash, cash equivalents and short-term investments of $165.8 million
at year end 2022 expected to provide sufficient runway to generate positive free cash flow by the end of 2024
Company to host conference call and webcast today at 5:00 p.m. ET
SOUTH SAN FRANCISCO, Calif., February 14, 2023 - Standard BioTools
Inc. (Nasdaq:LAB), driven by a bold purpose - Unleashing tools to accelerate breakthroughs in human health -
today reported financial results for the fourth quarter and year ended December 31, 2022.
"I'm pleased with the results coming out of what has been a
transformative year for Standard BioTools. We have now positioned the business for consistent growth, improved gross margins and reduced
operating expenses in 2023," said Michael Egholm, PhD, President and Chief Executive Officer of Standard BioTools . "We
posted our second quarter of sequential revenue growth while completing a phased restructuring, which is expected to reduce ongoing operating
expenses by over $30 million. Although there is more work to do, we are now squarely focused on the future."
Phased restructuring: As previously disclosed, in the
fourth quarter, the company implemented the next phase of its restructuring plan, which is expected to result in a total of more than
$35 million in GAAP operating expense reductions for 2023 and improve operating margins by approximately 3,600 basis points. The company
anticipates non-GAAP operating expense reductions of approximately $30 million for 2023 and approximately 3,100 basis point improvement
in operating margin.
Proteomics (Mass Cytometry): With Proteomics being the
driver of future growth, the company has reinvigorated its innovation engine and will be launching its next-generation Imaging Mass Cytometry
system, the Hyperion XTi Imaging System, in April at the American Association for Cancer Research (AACR) conference. This system
provides a market-leading five-fold increase in the number of slides that can be processed per day over the legacy Hyperion Imaging
System. Two early access units were shipped in December.
Genomics (Microfluidics): During the last six months
of 2022 the company right-sized the Genomics business, simplifying the product line to one instrument, the X9 Real-Time PCR System,
which launched in October. Furthermore, the company moved to a more capital-efficient go-to-market strategy that emphasizes additional
OEM partnerships and large account opportunities.
Fourth Quarter 2022 Financial Results
Fourth quarter 2022 GAAP revenues were $27.0 million. Core
product and service revenues (Genomics and Proteomics, excluding discontinued and COVID-19 related products) were $26.8 million, representing
approximately 8.3% sequential quarterly growth.
GAAP product and services margins increased 620 basis points
sequentially to 40.9%. Non-GAAP product and services margin, which primarily excludes non-cash amortization, increased 520 points sequentially
GAAP operating expenses were $32.3 million for the fourth
quarter, a 16% decrease from the third quarter of 2022. Non-GAAP operating expenses, which primarily exclude non-cash stock-based compensation,
were $30.1 million, a 9% decline from the third quarter of 2022.
Full Year 2022 Financial Results
GAAP revenues were $97.9 million compared to $130.6 million
in 2021. Core product and service revenues (Genomics and Proteomics excluding COVID and discontinued operations) were $94.5 million compared
to $111.6 million in the prior year.
GAAP product and service margins were 36.7% compared to 51.5%
in 2021. Non-GAAP product and service margins were 50.2% compared to 62.2% in 2021.
GAAP operating expenses were $153.3 million compared to $136.8
million in 2021. Non-GAAP operating expenses, which exclude stock-based compensation, depreciation and amortization and impairment charges,
were $132.6 million in 2022 compared to $118.6 million in 2021. Restructuring, business improvement and deal-related activities added
operating expenses in 2022. However, those restructuring and business improvement activities are expected to result in a significant non-GAAP
operating expense reduction totaling over $30 million on an ongoing annual basis.
Business Outlook for 2023
For 2023, Standard BioTools expects flat-to-moderate growth
in core product and service revenues relative to 2022 core product and service revenues of $94.5 million. This business outlook accounts
for a previously disclosed $5 million headwind in the Genomics business due to the temporary launch inventory build by a major customer
throughout 2022 and the subsequent run-rate normalization expected in 2023. The company expects revenues to follow typical seasonality
patterns experienced in the life science tools industry with a sequentially lower first quarter and a seasonally high fourth quarter.
GAAP product and services margins are currently expected to
increase to 52%-55% by the fourth quarter of 2023, representing an 1,100-1,400 basis point increase over the fourth quarter
of 2022. Non-GAAP product and services margins are expected to increase to 65%-68% by the fourth quarter of 2023, representing a
1,200-1,500 basis point increase over the fourth quarter of 2022.
Management expects GAAP operating expenses of approximately
$118 million to $123 million with non-GAAP operating expenses (which primarily exclude approximately $13 million of non-cash stock-based
compensation expense) of approximately $102 million to $107 million for 2023, representing approximately 20% improvement in operating
expenses on both GAAP and non-GAAP basis.
Conference Call Information
The company's management
will host a conference call and webcast today at 2:00 p.m. PT, 5:00 p.m. ET, to discuss fourth quarter and full year 2022 financial
results and operational progress as well as to provide additional color on its strategic actions.
Individuals interested in listening
to the conference call may do so by dialing:
callers: (888) 346-3970
callers: (412) 902-4297
webcast will be available online from the Investor Relations page of the company's website at Events
& Presentations. The webcast will be archived and available on the Standard BioTools Investor
Relations page at investors.standardbio.com.
Our investor presentation including Supplemental Financial Information
has been posted on our website concurrent with this release.
Statement Regarding Use of Non-GAAP Financial Information
Standard BioTools has presented certain financial information in accordance
with U.S. GAAP and also on a non-GAAP basis, including for the three- and twelve-month periods ended December 31, 2022. Management believes
that non-GAAP financial measures, taken in conjunction with GAAP financial measures, provide useful information for both management and
investors by excluding certain non-cash and other expenses that are not indicative of the company's core operating results. Management
uses non-GAAP measures to compare the company's performance relative to forecasts and strategic plans and to benchmark the company's
performance externally against competitors. Non-GAAP information is not prepared under a comprehensive set of accounting rules and should
only be used to supplement an understanding of the company's operating results as reported under U.S. GAAP. Standard BioTools encourages
investors to carefully consider its results under GAAP, as well as its supplemental non-GAAP information and the reconciliation between
these presentations, to more fully understand its business. Reconciliations between GAAP and non-GAAP operating results are presented
in the accompanying tables of this release.
Use of Forward-Looking Statements
This press release contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995, including, among others, guidance related to revenues, gross margin, operating
expenses and free cash flow, statements regarding future financial performance and expectations, operational and strategic plans, deployment
of capital, our cash runway and sufficiency of cash resources, potential M&A activity, and expectations with respect to our restructuring