VCYT 10-Q

Veracyte, Inc. (VCYT)

10-Q 2022-05-04 For: 2022-03-31

View Original

Added on April 11, 2026

Search and read filings like this one from Claude or ChatGPT with the SEC filings MCP server →


						Page No.
PART I. — FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements (Unaudited)						1
Condensed Consolidated Balance Sheets as of Mar ch 3 1 , 202 2 and December 31, 202 1						1
Condensed Consolidated Statements of Operations for the Three Month Periods Ended March 3 1 , 202 2 and 202 1						2
Condensed Consolidated Statements of Comprehensive Loss for the Three Month Periods Ended March 31, 2022 and 2021						3
Condensed Consolidated Statements of Stockholders' Equity for the Three Month Periods Ended March 31, 2022 and 2021						4
Condensed Consolidated Statements of Cash Flows for the Three Month Periods Ended March 31, 2022 and 2021						5
Notes to Condensed Consolidated Financial Statements						6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations						19
Item 3. Quantitative and Qualitative Disclosures About Market Risk						32
Item 4. Controls and Procedures						32
PART II. — OTHER INFORMATION
Item 1A. Risk Factors						33
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds						72
Item 3. Defaults Upon Senior Securities						72
Item 4. Mine Safety Disclosures						72
Item 5. Other Information						72
Item 6. Exhibits						72
SIGNATURES						74


	March 31, 2022		December 31, 2021
			(See Note 1)
Assets
Current assets:
Cash and cash equivalents	$	163,615	$	173,197
Accounts receivable	42,481		41,461
Supplies and inventory	12,372		11,225
Prepaid expenses and other current assets	20,015		17,219
Total current assets	238,483		243,102
Property and equipment, net	16,299		15,098
Right-of-use assets, operating leases	15,663		16,043
Intangible assets, net	196,228		202,731
Goodwill	704,368		707,904
Restricted cash	749		749
Other assets	1,799		2,198
Total assets	$	1,173,589	$	1,187,825
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	11,273	$	12,360
Accrued liabilities	38,543		39,475
Current portion of long-term debt	1,079		1,127
Current portion of deferred revenue	4,878		4,646
Current portion of acquisition-related contingent consideration	2,703		2,682
Current portion of operating lease liabilities	3,849		3,630
Current portion of other liabilities	218		231
Total current liabilities	62,543		64,151
Deferred revenue, net of current portion	278		343
Deferred tax liabilities	4,983		5,592
Acquisition-related contingent consideration, net of current portion	5,732		5,722
Operating lease liabilities, net of current portion	13,485		14,096
Other liabilities	1,378		1,407
Total liabilities	88,399		91,311
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.001 par value; 5,000,000 shares authorized, no shares issued and outstanding as of March 31, 2022 and December 31, 2021	—		—
Common stock, $0.001 par value; 125,000,000 shares authorized, 71,432,875 and 71,123,108 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively	71		71
Additional paid-in capital	1,477,418		1,468,683
Accumulated deficit	(371,618)		(357,157)
Accumulated other comprehensive loss	(20,681)		(15,083)
Total stockholders’ equity	1,085,190		1,096,514
Total liabilities and stockholders’ equity	$	1,173,589	$	1,187,825


	Three Months Ended March 31,
	2022		2021
Revenue:
Testing revenue	$	55,980	$	33,078
Product revenue	2,979		3,059
Biopharmaceutical and other revenue	8,824		566
Total revenue	67,783		36,703
Operating expenses:
Cost of testing revenue	17,523		10,832
Cost of product revenue	1,575		1,490
Cost of biopharmaceutical and other revenue	4,615		81
Research and development	9,166		5,336
Selling and marketing	23,754		16,296
General and administrative	20,912		46,282
Intangible asset amortization	5,486		1,801
Total operating expenses	83,031		82,118
Loss from operations	(15,248)		(45,415)
Other income (loss), net	784		(248)
Loss before income taxes	(14,464)		(45,663)
Income tax benefit	(3)		(3,795)
Net loss	$	(14,461)	$	(41,868)
Net loss per common share, basic and diluted	$	(0.20)	$	(0.66)
Shares used to compute net loss per common share, basic and diluted	71,229,672		63,331,702


	Three Months Ended March 31,
	2022		2021
Net loss	$	(14,461)	$	(41,868)
Other comprehensive loss:
Change in currency translation adjustments	(5,598)		—








Net comprehensive loss	$	(20,059)	$	(41,868)


	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders' Equity
	Shares	Amount
Balance at December 31, 2021	71,123	$	71	$	1,468,683	$	(357,157)	$	(15,083)	$	1,096,514
Issuance of common stock on exercise of stock options and vesting of restricted stock units	228	—		1,422		—		—		1,422
Issuance of common stock under employee stock purchase plan (ESPP)	82	—		2,115		—		—		2,115
Tax portion of vested restricted stock units	—	—		(1,447)		—		—		(1,447)
Stock-based compensation expense (employee)	—	—		6,230		—		—		6,230
Stock-based compensation expense (non-employee)	—	—		11		—		—		11
Stock-based compensation expense (ESPP)	—	—		404		—		—		404
Net loss	—	—		—		(14,461)		—		(14,461)
Comprehensive loss	—	—		—		—		(5,598)		(5,598)
Balance at March 31, 2022	71,433	$	71	$	1,477,418	$	(371,618)	$	(20,681)	$	1,085,190


☒			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


	March 31, 2022		December 31, 2021
Medicare	14	%	12	%
UnitedHealthcare	10	%	9	%


	March 31, 2022						December 31, 2021						Weighted Average Amortization Period (Years)
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Percepta product technology	$	16,000	$	(7,467)	$	8,533	$	16,000	$	(7,200)	$	8,800	15
Prosigna product technology	4,120		(641)		3,479		4,120		(572)		3,548		15
Prosigna customer relationships	2,430		(1,134)		1,296		2,430		(1,013)		1,417		5
nCounter Dx license	46,880		(7,292)		39,588		46,880		(6,511)		40,369		15
LymphMark product technology	990		(330)		660		990		(295)		695		7
Decipher product technology	90,000		(9,484)		80,516		90,000		(7,234)		82,766		10
Decipher trade names	4,000		(843)		3,157		4,000		(643)		3,357		5
HalioDx developed technology	44,781		(2,961)		41,820		45,640		(1,877)		43,763		10
HalioDx customer relationships	4,778		(556)		4,222		4,870		(352)		4,518		6
HalioDx customer backlog	6,778		(1,121)		5,657		6,908		(710)		6,198		4
Total finite-lived intangibles	220,757		(31,829)		188,928		221,838		(26,407)		195,431		10.9
In-process research and development	7,300		—		7,300		7,300		—		7,300
Total intangible assets	$	228,057	$	(31,829)	$	196,228	$	229,138	$	(26,407)	$	202,731


Year Ending December 31,	Amounts
2022 remainder of year	$	16,431
2023	21,908
2024	21,868
2025	20,725
2026	18,844
Thereafter	89,152
Total	$	188,928


	March 31, 2022		December 31, 2021
Accrued compensation expenses	$	29,525	$	30,792
Accrued other	9,018		8,683
Total accrued liabilities	$	38,543	$	39,475


Cash and cash equivalents	$	5,938
Accounts receivable	9,298
Supplies inventory	3,610
Prepaids and other current assets	7,045
Property and equipment, net	2,716
Right-of-use assets, financing lease	733
Right-of-use assets, operating lease	2,136
Intangible assets	60,303
Other assets	524
Total identifiable assets acquired	92,303
Accounts payable	(2,645)
Accrued liabilities	(5,627)
Current portion of financing lease liability	(247)
Current portion of operating lease liability	(448)
Long-term debt	(1,171)
Deferred revenue	(3,250)
Financing lease liability, net of current portion	(488)
Operating lease liability, net of current portion	(1,687)
Deferred tax liability	(6,946)
Net identifiable assets acquired	69,794
Goodwill	249,846
Total purchase price	$	319,640


Cash and cash equivalents	$	19,782
Accounts receivable	7,562
Supplies inventory	1,641
Prepaids and other current assets	778
Property and equipment, net	1,737
Right-of-use assets, operating lease	7,601
Finite-lived intangible assets	94,000
Indefinite-lived intangible assets	7,300
Restricted cash	146
Other assets	3,075
Total identifiable assets acquired	143,622
Accounts payable	(2,351)
Accrued liabilities	(4,322)
Operating lease obligations (current)	(1,241)
Operating lease obligations, net of current portion	(4,540)
Deferred tax liability	(4,740)
Net identifiable assets acquired	126,428
Goodwill	468,266
Total purchase price	$	594,694


	Value or Range (Weighted-Average)
Unobservable input	March 31, 2022	December 31, 2021
Discount rate	6.7%	5.9%
Probability of achievement	80% - 100% (94%)	80% - 100% (94%)


Year Ending December 31,	Amounts
Remainder of 2022	$	3,450
2023	4,672
2024	4,431
2025	4,482
2026	1,402
Thereafter	1,570
Total future minimum lease payments	20,007
Less: amount representing interest	2,673
Present value of future lease payments	17,334
Less: short-term lease liabilities	3,849
Long-term lease liabilities	$	13,485


	Three Months Ended March 31,
	2022		2021		Change		%
Cost of testing revenue:
Laboratory costs	$	8,730	$	5,753	$	2,977	52	%
Sample collection costs	1,967		1,207		760		63	%
Compensation expense	3,966		2,335		1,631		70	%
License fees and royalties	379		64		315		492	%
Depreciation and amortization	327		271		56		21	%
Other expenses	941		439		502		114	%
Allocations	1,213		763		450		59	%
Total	$	17,523	$	10,832	$	6,691	62	%
Cost of product revenue:
Product costs	$	1,207	$	1,196	$	11	1	%
License fees and royalties	274		275		(1)		—	%
Depreciation and amortization	19		19		—		—	%
Other expenses	66		—		66		NM
Allocations	9		—		9		NM
Total	$	1,575	$	1,490	$	85	6	%
Cost of biopharmaceutical and other revenue:
Compensation expense	$	2,337	$	38	$	2,299	6,050	%
Laboratory expense	70		—		70		NM
License fees and royalties	26		—		26		NM
Depreciation and amortization	93		—		93		NM
Other expenses	2,040		43		1,997		4,644	%
Allocations	49		—		49		NM
Total	$	4,615	$	81	$	4,534	5,598	%


	Three Months Ended March 31,
	2022		2021		Change		%
Research and development expense:
Compensation expense	$	7,125	$	3,888	$	3,237	83%
Direct research and development expense	822		630		192		30%
Professional fees	239		316		(77)		(24)%
Depreciation and amortization	114		53		61		115%
Other expenses	288		32		256		800%
Allocations	578		417		161		39%
Total	$	9,166	$	5,336	$	3,830	72%


	Three Months Ended March 31,
	2022		2021		Change		%
Selling and marketing expense:
Compensation expense	$	18,328	$	12,157	$	6,171	51	%
Direct marketing expense	1,301		1,364		(63)		(5)	%
Professional fees	455		712		(257)		(36)	%
Other expenses	2,360		1,136		1,224		108	%
Allocations	1,310		927		383		41	%
Total	$	23,754	$	16,296	$	7,458	46	%


	Three Months Ended March 31,
	2022		2021		Change		%
General and administrative expense:
Compensation expense	$	15,098	$	32,352	$	(17,254)	(53)	%
Professional fees	4,962		13,242		(8,280)		(63)	%
Occupancy expenses	1,511		745		766		103	%
Depreciation and amortization	517		406		111		27	%
Other expenses	1,983		1,644		339		21	%
Allocations	(3,159)		(2,107)		(1,052)		50	%
Total	$	20,912	$	46,282	$	(25,370)	(55)	%


	March 31, 2022		December 31, 2021
Debt principal	$	—	$	—
End-of-term debt obligation	1,079		1,026
Total debt obligation	$	1,079	$	1,026


	March 31, 2022	December 31, 2021
Stock options and restricted stock units issued and outstanding	5,997,843	4,892,164
Stock options and restricted stock units available for grant under stock option plans	5,929,676	4,418,364
Common stock available for the Employee Stock Purchase Plan	1,408,296	1,490,130
Total	13,335,815	10,800,658