QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
☒ | Accelerated filer | ☐ | ||||
Non-accelerated filer |
☐ | Small reporting company | ||||
Emerging growth company |
• | our ability to increase our revenue and our revenue growth rate; |
• | our ability to accurately estimate capital requirements and our needs for additional financing; our estimates of the size of our market opportunities; |
• | our ability to increase DNA production, reduce turnaround times and drive cost reductions for our customers; |
• | our ability to effectively manage our growth; |
• | our ability to successfully enter new markets and manage our international expansion; |
• | our ability to protect our intellectual property, including our proprietary DNA synthesis platform; |
• | costs associated with defending intellectual property infringement and other claims; |
• | the effects of increased competition in our business; |
• | our ability to keep pace with changes in technology and our competitors; |
• | our ability to successfully identify, evaluate and manage any future acquisitions of businesses, solutions or technologies; |
• | the success of our marketing efforts; |
• | a significant disruption in, or breach in security of our information technology systems and resultant interruptions in service and any related impact on our reputation; |
• | our ability to attract and retain qualified employees and key personnel; |
• | the effects of natural or man-made catastrophic events including those resulting from the novel strain of coronavirus that causes coronavirus disease 2019, or COVID-19, that was first identified in Wuhan, China; |
• | the effectiveness of our internal controls; |
• | changes in government regulation affecting our business; |
• | uncertainty as to economic and market conditions and the impact of adverse economic conditions; and |
• | other risk factors included under the section titled “Risk Factors.” |
Item 1. |
Financial statements |
(In thousands) |
December 31, 2020 |
September 30, 2020 |
||||||
Assets |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | $ | ||||||
Short-term investments |
||||||||
Accounts receivable, net |
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Inventories |
||||||||
Prepaid expenses and other current assets |
||||||||
Total current assets |
$ | $ | ||||||
Property and equipment, net |
||||||||
Operating lease right-of-use assets |
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Goodwill |
||||||||
Intangible assets, net |
||||||||
Restricted cash, non-current |
||||||||
Other non-current assets |
||||||||
Total assets |
$ | $ | ||||||
Liabilities and stockholders’ equity |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | $ | ||||||
Accrued expenses |
||||||||
Accrued compensation |
||||||||
Current portion of operating lease liability |
||||||||
Current portion of long-term debt |
||||||||
Other current liabilities |
||||||||
Total current liabilities |
$ | $ | ||||||
Operating lease liability, net of current portion |
||||||||
Long-term debt, net of current portion |
||||||||
Other non-current liabilities |
||||||||
Total liabilities |
$ | |||||||
Commitments and contingencies (Note 6) |
||||||||
Stockholders’ equity |
||||||||
Common stock, $ 2020 and September 30, 2020, respectively |
$ | $ | |
|||||
Additional paid-in capital |
||||||||
Accumulated other comprehensive income |
||||||||
Accumulated deficit |
( |
) | ( |
) | ||||
Total stockholders’ equity |
$ | $ | ||||||
Total liabilities and stockholders’ equity |
$ | $ | ||||||
Three months ended December 31, |
||||||||
(In thousands, except per share data) |
2020 |
2019 |
||||||
Revenues |
$ | $ | ||||||
Operating expenses: |
||||||||
Cost of revenues |
$ | $ | ||||||
Research and development |
||||||||
Selling, general and administrative |
||||||||
Litigation settlement |
||||||||
Total operating expenses |
$ | $ | ||||||
Loss from operations |
$ | ( |
) | $ | ( |
) | ||
Interest income |
||||||||
Interest expense |
( |
) | ( |
) | ||||
Other income (expense), net |
( |
) | ( |
) | ||||
Loss before income taxes |
$ | ( |
) | $ | ( |
) | ||
Provision for income taxes |
( |
) | ( |
) | ||||
Net loss attributable to common stockholders |
$ | ( |
) | $ | ( |
) | ||
Other comprehensive loss: |
||||||||
Change in unrealized income/( loss) on investments |
( |
) | ||||||
Foreign currency translation adjustment |
( |
) | ||||||
Comprehensive loss |
( |
) | ( |
) | ||||
Net loss per share attributable to common stockholders—basic and diluted |
$ | ( |
) | $ | ( |
) | ||
Weighted average shares used in computing net loss per share attributable to common stockholders—basic and diluted |
||||||||
Common stock |
Additional paid-in capital |
Accumulated other comprehensive income |
Accumulated deficit |
Total stockholders’ equity |
||||||||||||||||||||
(In thousands) |
Shares |
Amount |
||||||||||||||||||||||
Balances as of September 30, 2020 |
$ | — | $ | $ | $ | ( |
) | $ | ||||||||||||||||
|
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|
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Issuance of common stock in public offering, net of underwriting discounts and commissions and offering expenses of $ |
— | — | — | |||||||||||||||||||||
Vesting of restricted stock units |
— | — | — | — | — | |||||||||||||||||||
Exercise of stock options |
— | — | — | |||||||||||||||||||||
Net exercise of stock warrants |
— | — | — | — | — | |||||||||||||||||||
Repurchases of common stock for income tax withholding |
( |
) | — | ( |
) | — | — | ( |
) | |||||||||||||||
Stock-based compensation |
— | — | — | — | ||||||||||||||||||||
Other comprehensive income |
— | — | — | — | ||||||||||||||||||||
Net loss |
— | — | — | — | ( |
) | ( |
) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balances as of December 31, 2020 |
$ | — | $ | $ | $ | ( |
) | $ | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Common stock |
Additional paid-in capital |
Accumulated other comprehensive income |
Accumulated deficit |
Total stockholders’ equity |
||||||||||||||||||||
(In thousands) |
Shares |
Amount |
||||||||||||||||||||||
Balances as of September 30, 2019 |
$ | — | $ | $ | $ | ( |
) | $ | ||||||||||||||||
|
|
|
|
|
|
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|
|
|
|
|
|||||||||||||
Issuance of common stock in public offering, net of underwriting discounts and commissions and offering expenses of $ |
— | — | — | |||||||||||||||||||||
Vesting of restricted stock units |
— | — | — | — | — | |||||||||||||||||||
Exercise of stock options |
— | — | — | |||||||||||||||||||||
Repurchases of early exercised stock options |
( |
) | — | — | — | — | — | |||||||||||||||||
Repurchases of common stock for income tax withholding |
( |
) | — | ( |
) | — | — | ( |
) | |||||||||||||||
Stock-based compensation |
— | — | — | — | ||||||||||||||||||||
Other comprehensive income |
— | — | — | — | ||||||||||||||||||||
Net loss |
— | — | — | — | ( |
) | ( |
) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balances as of December 31, 2019 |
$ | — | $ | $ | $ | ( |
) | $ | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended December 31, |
||||||||
(in thousands) |
2020 |
2019 |
||||||
Cash flows from operating activities |
||||||||
Net loss |
$ | ( |
) | $ | ( |
) | ||
Adjustments to reconcile net loss to net cash used in operating activities |
||||||||
Depreciation and amortization |
||||||||
Loss on disposal of property and equipment |
— | |||||||
Non-cash lease expense |
||||||||
Stock-based compensation |
||||||||
Discount accretion on investment securities |
( |
) | ||||||
Non-cash interest expense |
||||||||
Amortization of debt discount |
||||||||
Changes in assets and liabilities: |
||||||||
Accounts receivable, net |
( |
) | ||||||
Inventories |
( |
) | ( |
) | ||||
Prepaid expenses and other current assets |
( |
) | ( |
) | ||||
Other non-current assets |
||||||||
Accounts payable |
( |
) | ||||||
Accrued expenses |
( |
) | ( |
) | ||||
Accrued compensation |
( |
) | ( |
) | ||||
Accrued litigation settlement |
— | |||||||
Other liabilities |
||||||||
|
|
|
|
|||||
Net cash used in operating activities |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Cash flows from investing activities |
||||||||
Purchases of property and equipment |
( |
) | ( |
) | ||||
Purchases of investments |
( |
) | ( |
) | ||||
Proceeds from maturity of investments |
||||||||
|
|
|
|
|||||
Net cash (used in) / provided by investing activities |
( |
) | ||||||
|
|
|
|
|||||
Cash flows from financing activities |
||||||||
Proceeds from exercise of stock options |
||||||||
Proceeds from public offering, net of underwriting discounts and commissions and offering expenses |
||||||||
Repayments of long-term debt |
( |
) | ( |
) | ||||
Repurchases of common stock for income tax withholding |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Net cash provided by financing activities |
||||||||
|
|
|
|
|||||
Effect of exchange rates on cash, cash equivalents and restricted cash |
||||||||
Net increase (decrease) in cash, cash equivalents, and restricted cash |
( |
) | ||||||
Cash, cash equivalents, and restricted cash at beginning of period |
||||||||
|
|
|
|
|||||
Cash, cash equivalents, and restricted cash at end of period |
||||||||
|
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|
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Supplemental disclosure of cash flow information |
||||||||
Interest paid |
||||||||
Income taxes paid, net of refunds |
||||||||
Non-cash investing and financing activities |
||||||||
Property and equipment additions included in accounts payable and accrued expenses |
||||||||
Operating lease right-of-use assets obtained in exchange for operating lease liabilities |
— | |||||||
Deferred offering costs included in accounts payable and accrued expenses |
— |
(in thousands) |
December 2020 |
September 30, 2020 |
||||||
Cash and cash equivalents |
$ | $ | ||||||
Restricted cash, non-current |
||||||||
Total cash, cash equivalents and restricted cash |
$ | $ | ||||||
December 31, 2020 |
||||||||||||||||
(in thousands) |
Level 1 |
Level 2 |
Level 3 |
Fair value |
||||||||||||
Assets |
||||||||||||||||
Cash |
$ | $ | — | $ | — | $ | ||||||||||
Money market funds |
— | — | ||||||||||||||
Commercial paper |
— | — | ||||||||||||||
U.S. government treasury bills |
— | — | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Totals |
$ | $ | $ | — | $ | |||||||||||
|
|
|
|
|
|
|
|
September 30, 2020 |
||||||||||||||||
(in thousands) |
Level 1 |
Level 2 |
Level 3 |
Fair value |
||||||||||||
Assets |
||||||||||||||||
Cash |
$ | $ | — | $ | — | $ | ||||||||||
Money market funds |
— | — | ||||||||||||||
Commercial paper |
— | — | ||||||||||||||
U.S. government treasury bills |
— | — | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Totals |
$ | $ | $ | — | $ | |||||||||||
|
|
|
|
|
|
|
|
(in thousands) |
December 31, 2020 |
September 30, 2020 |
||||||
Trade Receivables |
$ | $ | ||||||
Other Receivables |
||||||||
Allowance for Doubtful Accounts |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Accounts Receivable, net |
$ | $ | ||||||
|
|
|
|
(in thousands) |
December 31, 2020 |
September 30, 2020 |
||||||
Raw Materials |
$ | $ | ||||||
Work-in-process |
||||||||
Finished Goods |
||||||||
|
|
|
|
|||||
$ | $ | |||||||
|
|
|
|
December 31, 2020 |
||||||||||||||||
(in thousands, except for years) |
Useful lives in years |
Gross carrying amount |
Accumulated amortization |
Net book value |
||||||||||||
Developed Technology |
$ | $ |
( |
) | $ |
|||||||||||
Tradenames & Trademarks |
( |
) | — | |||||||||||||
|
|
|
|
|
|
|||||||||||
Total indefinite-lived intangible assets |
$ | $ |
( |
) | $ |
|||||||||||
|
|
|
|
|
|
September 30, 2020 |
||||||||||||||||
(in thousands, except for years) |
Useful lives in years |
Gross carrying amount |
Accumulated amortization |
Net book value |
||||||||||||
Developed Technology |
$ | $ | ( |
) | $ | |||||||||||
Tradenames & Trademarks |
( |
) | — | |||||||||||||
|
|
|
|
|
|
|||||||||||
Total indefinite-lived intangible assets |
$ | $ | ( |
) | $ | |||||||||||
|
|
|
|
|
|
6. |
Commitments and contingencies |
(in thousands) |
December 31, 2020 |
|||
Assets: |
||||
Operating lease right-of-use-asset |
$ | |||
Current liabilities: |
||||
Current portion of operating lease liabilities |
$ | |||
Noncurrent liabilities: |
||||
Operating lease liabilities, net of current portion |
$ | |||
|
|
(in thousands) |
Operating leases |
|||
Years ending September 30: |
||||
Remainder of 2021 |
$ | |||
2022 |
||||
2023 |
||||
2024 |
||||
2025 |
||||
Thereafter |
||||
|
|
|||
Total minimum lease payments |
$ | |||
Less: imputed interest |
( |
) | ||
|
|
|||
Total operating lease liabilities |
$ | |||
Less: current portion |
( |
) | ||
|
|
|||
Operating lease liabilities, net of current portion |
$ | |||
|
|
7. |
Related party transactions |
8. |
Income taxes |
9. |
Warrants |
10. |
Common stock |
11. |
Stock-based compensation |
(In thousands, except per share data) |
Shares available |
Options outstanding |
Weighted average exercise price per share |
Weighted average remaining contractual term (years) |
Aggregate intrinsic value |
|||||||||||||||
Outstanding at September 30, 2020 |
$ | $ | ||||||||||||||||||
Stock options granted |
( |
) | ||||||||||||||||||
Stock options exercised |
— | ( |
) | |||||||||||||||||
Stock options forfeited |
( |
) | ||||||||||||||||||
Restricted stock units granted |
( |
) | — | — | ||||||||||||||||
Forfeiture of restricted stock units |
— | — | ||||||||||||||||||
Shares withheld for payment of taxes |
— | — | ||||||||||||||||||
Outstanding at Decem b er 31, 2020 |
$ | $ | ||||||||||||||||||
Vested or expected to vest at December 31, 2020 |
$ | $ | ||||||||||||||||||
Vested and exercisable at December 31, 202 0 |
$ | $ | ||||||||||||||||||
Three months ended December 31, |
||||||||
(in thousands) |
2020 |
2019 |
||||||
Cost of revenues |
$ | $ | ||||||
Research and development |
||||||||
Selling, general and administrative |
||||||||
Total stock-based compensation |
$ | $ | ||||||
(in thousands, except per share data) |
Number of Shares |
Weighted average grant date fair value per share |
Weighted average remaining contractual term (years) |
Aggregate Intrinsic Value |
||||||||||||
Outstanding at September 30, 2020 |
$ | $ | ||||||||||||||
Restricted stock units granted |
||||||||||||||||
Restricted stock units vested |
( |
) | ||||||||||||||
Restricted stock units forfeited |
( |
) | ||||||||||||||
Outstanding at December 31, 2020 |
$ | $ | ||||||||||||||
Expected to vest at December 31, 2020 |
$ | $ | ||||||||||||||
(In thousands) |
Shares available |
|||
Outstanding at September 30, 2020 |
||||
Additional shares authorized |
||||
Shares issued during the period |
||||
Outstanding at December 31, 2020 |
||||
Three months ended December 31, |
||||||||
(in thousands, except per share data) |
2020 |
2019 |
||||||
Numerator: |
||||||||
Net loss attributable to common stockholders |
$ | ( |
) | $ | ( |
) | ||
|
|
|
|
|||||
Denominator: |
||||||||
Weighted average shares used in computing net loss per share, basic and diluted |
||||||||
|
|
|
|
|||||
Net loss per share attributable to common stockholders, basic and diluted |
$ | ( |
) | $ | ( |
) | ||
|
|
|
|
Three months ended December 31, |
||||||||
(in thousands) |
2020 |
2019 |
||||||
Shares subject to options to purchase common stock |
||||||||
Shares subject to performance-based stock options |
|
|
|
|
|
|
— |
|
Unvested restricted shares of common stock |
— | |||||||
Unvested restricted stock unit s |
||||||||
Unvested shares of common stock issued upon early exercise of stock options |
||||||||
Shares subject to employee stock purchase plan |
||||||||
Shares subject to warrants to purchase common stock |
||||||||
|
|
|
|
|||||
Total |
||||||||
|
|
|
|
Three months ended December 31, |
||||||||
(in thousands) |
2020 |
2019 |
||||||
United States |
$ | $ | ||||||
EMEA |
||||||||
APAC |
||||||||
Americas |
||||||||
|
|
|
|
|||||
Total |
$ | $ | ||||||
|
|
|
|
Three months ended December 31, |
||||||||
(in thousands) |
2020 |
2019 |
||||||
Synthetic genes |
$ | $ | ||||||
Oligo pools |
||||||||
DNA and Biopharma libraries |
||||||||
NGS tools |
||||||||
|
|
|
|
|||||
Total |
$ | $ | ||||||
|
|
|
|
Three months ended December 31, |
||||||||
(in thousands) |
2020 |
2019 |
||||||
Industrial chemicals |
$ | $ | ||||||
Academic research |
||||||||
Healthcare |
||||||||
Food/agricultural |
||||||||
|
|
|
|
|||||
Total |
$ | $ | ||||||
|
|
|
|
Item 2. |
Management’s discussion and analysis of financial condition and results of operations |
• | Revenue growth of 64% to $28.2 million from $17.2 million, primarily due to growth in NGS tools, DNA Libraries and Synthetic Genes. |
Three months ended December 31, |
||||||||
(in thousands) |
2020 |
2019 |
||||||
Revenues |
$ | 28,161 | $ | 17,164 | ||||
Loss from operations |
(32,793 | ) | (55,830 | ) | ||||
Net loss attributable to common stockholders |
(32,900 | ) | (55,638 | ) |
Three months ended December 31, |
||||||||||||||||
(in thousands, except percentages) |
2020 |
% |
2019 |
% |
||||||||||||
United States |
$ | 17,034 | 61 | % | $ | 9,827 | 57 | % | ||||||||
EMEA |
9,058 | 32 | % | 5,941 | 35 | % | ||||||||||
APAC |
1,767 | 6 | % | 1,241 | 7 | % | ||||||||||
Americas |
302 | 1 | % | 155 | 1 | % | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total revenues |
$ | 28,161 | 100 | % | $ | 17,164 | 100 | % | ||||||||
|
|
|
|
|
|
|
|
Three months ended December 31, |
||||||||||||||||
(in thousands, except percentages) |
2020 |
% |
2019 |
% |
||||||||||||
Synthetic genes |
$ | 8,874 | 32 | % | $ | 7,836 | 46 | % | ||||||||
Oligo pools |
1,510 | 5 | % | 1,242 | 7 | % | ||||||||||
DNA and Biopharma libraries |
2,205 | 8 | % | 1,057 | 6 | % | ||||||||||
NGS tools |
15,572 | 55 | % | 7,029 | 41 | % | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total revenues |
$ | 28,161 | 100 | % | $ | 17,164 | 100 | % | ||||||||
|
|
|
|
|
|
|
|
Three months ended December 31, |
||||||||||||||||
(in thousands, except percentages) |
2020 |
% |
2019 |
% |
||||||||||||
Industrial chemicals |
$ | 7,132 | 25 | % | $ | 6,137 | 36 | % | ||||||||
Academic research |
4,901 | 17 | % | 4,951 | 29 | % | ||||||||||
Healthcare |
15,976 | 57 | % | 5,835 | 34 | % | ||||||||||
Food/agriculture |
152 | 1 | % | 241 | 1 | % | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total revenues |
$ | 28,161 | 100 | % | $ | 17,164 | 100 | % | ||||||||
|
|
|
|
|
|
|
|
Three months ended |
||||||||||||||||||||||||||||||||
(in thousands, except shipments) |
December 31, 2020 |
September 30, 2020 |
June 30, 2020 |
March 31, 2020 |
December 31, 2019 |
September 30, 2019 |
June 30, 2019 |
March 31, 2019 |
||||||||||||||||||||||||
Number of genes shipped |
84,234 | 86,605 | 83,216 | 88,545 | 79,851 | 80,022 | 68,069 | 69,087 | ||||||||||||||||||||||||
Number of shipments |
9,313 | 8,292 | 7,213 | 6,595 | 6,154 | 5,631 | 5,151 | 3,909 |
Three months ended December 31, |
||||||||||||||||
(in thousands, except percentages) |
2020 |
2019 |
Change |
% |
||||||||||||
Revenues |
$ | 28,161 | $ | 17,164 | $ | 10,997 | 64 | % |
Three months ended December 31, |
||||||||||||||||
(in thousands, except percentages) |
2020 |
2019 |
Change |
% |
||||||||||||
Cost of revenues |
$ | 18,162 | $ | 13,792 | $ | 4,370 | 32 | % |
Three months ended December 31, |
||||||||||||||||
(in thousands, except percentages) |
2020 |
2019 |
Change |
% |
||||||||||||
Research and development |
$ | 14,000 | $ | 10,297 | $ | 3,703 | 36 | % |
Three months ended December 31, |
||||||||||||||||
(in thousands, except percentages) |
2020 |
2019 |
Change |
% |
||||||||||||
Selling, general and administrative |
$ | 28,792 | $ | 26,405 | $ | 2,387 | 9 | % |
Three months ended December 31, |
||||||||||||||||
(in thousands, except percentages) |
2020 |
2019 |
Change |
% |
||||||||||||
Litigation settlement |
$ | — | $ | 22,500 | $ | 22,500 | 100 | % |
Three months ended December 31, |
||||||||||||||||
(in thousands, except percentages) |
2020 |
2019 |
Change |
% |
||||||||||||
Interest income |
$ | 134 | $ | 564 | $ | (430 | ) | 76 | % | |||||||
Interest expense |
(118 | ) | (248 | ) | 130 | 52 | % | |||||||||
Other income (expense) |
(77 | ) | (87 | ) | 10 | 11 | % | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Total interest and other income (expense), net |
(61 | ) | $ | 229 | (290 | ) | 140 | % |
Three months ended December 31, |
||||||||||||||||
(in thousands, except percentages) |
2020 |
2019 |
Change |
% |
||||||||||||
Provision for income taxes |
$ | 46 | $ | 37 | $ | 9 | 24 | % |
(in thousands), years ending September 30 |
Principal |
Interest |
Total |
|||||||||
Remainder of 2021 |
$ | 2,500 | $ | 106 | $ | 2,606 | ||||||
2022 |
833 | 9 | 842 | |||||||||
|
|
|
|
|
|
|||||||
3,333 | 115 | 3,448 | ||||||||||
Less: Interest |
(115 | ) | ||||||||||
|
|
|||||||||||
Total amount of loan principal |
3,333 | |||||||||||
Less unamortized debt discount |
(55 | ) | ||||||||||
Add accretion of final payment fee |
680 | |||||||||||
|
|
|||||||||||
$ | 3,958 |
Three months ended December 31, |
||||||||
(in thousands) |
2020 |
2019 |
||||||
Net cash used in operating activities |
$ | (24,932 | ) | $ | (34,914 | ) | ||
Net cash (used in) provided by investing activities |
(45,921 | ) | 12,405 | |||||
Net cash provided by financing activities |
326,921 | 2,057 |
Item 1A. |
Risk factors |
• | We are subject to risks associated with COVID-19; |
• | We have incurred net losses in every period to date, and we expect to continue to incur significant losses as we develop our business and may never achieve profitability; |
• | We will require additional financing to achieve our goals, and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our product manufacturing and development and other operations; |
• | If we are unable to maintain adequate revenue growth or do not successfully manage such growth, our business and growth prospects will be harmed; |
• | Rapidly changing technology and extensive competition in synthetic biology could make the products we are developing and producing obsolete or non-competitive unless we continue to develop and manufacture new and improved products and pursue new market opportunities; |
• | The continued success of our business relies heavily on our disruptive technologies and products and our position in the market as a leading provider or synthetic DNA using a silicon chip; |
• | We depend on one single-source supplier for a critical component for our DNA synthesis process. The loss of this supplier or its failure to supply us with the necessary component on a timely basis, could cause delays in the future capacity of our DNA synthesis process and adversely affect our business; |
• | We depend on the continuing efforts of our senior management team and other key personnel. If we lose members of our senior management team or other key personnel or are unable to successfully retain, recruit and train qualified researchers, engineering and other personnel, our ability to develop our products could be harmed, and we may be unable to achieve our goals; |
• | We may engage in strategic transactions, including acquisitions that could disrupt our business, cause dilution to our stockholders, reduce our financial resources, or prove not to be successful; |
• | Our products could in the future be subject to additional regulation by the U.S. Food and Drug Administration or other domestic and international regulatory agencies, which could increase our costs and delay our commercialization efforts, thereby materially and adversely affecting our business and results of operations; |
• | If we fail to maintain proper and effective internal controls, our ability to produce accurate financial statements on a timely basis could be impaired, which would adversely affect our business; |
• | Our ability to protect our intellectual property and proprietary technology through patents and other means is uncertain; |
• | If we are unable to obtain, maintain and enforce intellectual property protection, others may be able to make, use, or sell products and technologies substantially the same as ours, which could adversely affect our ability to compete in the market; |
• | We have never paid dividends on our capital stock and we do not intend to pay dividends for the foreseeable future. Consequently, any gains from an investment in our common stock will likely depend on whether the price of our common stock increases; |
• | Our charter documents and Delaware law could prevent a takeover that stockholders consider favorable and could also reduce the market price of our stock; |
• | The market price of our common stock is likely to be volatile and could fluctuate or decline, resulting in a substantial loss of your investment; and |
• | Future sales and issuances of our common stock or rights to purchase common stock, including pursuant to our equity incentive plans, could result in additional dilution of the percentage ownership of our stockholders and could cause the stock price of our common stock to decline. |