Special Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 concerning our business, operations and financial performance and condition, as well as our plans, objectives and expectations for our business, operations and financial performance and condition. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "aim," "anticipate," "assume," "believe," "contemplate," "continue," "could," "due," "estimate," "expect," "goal," "intend," "may," "objective," "plan," "predict," "potential," "positioned," "seek," "should," "target," "will," "would" and other similar expressions that are predictions of or indicate future events and future trends, or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words.
Forward-looking statements are based on management's current expectations, estimates, forecasts and projections about our business and the industry in which we operate, and management's beliefs and assumptions are not guarantees of future performance or development and involve known and unknown risks, uncertainties and other factors that are in some cases beyond our control. As a result, any or all of our forward-looking statements in this Quarterly Report on Form 10-Q may turn out to be inaccurate. Furthermore, if the forward-looking statements prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified time frame, or at all.
In addition, statements that "we believe" and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.
You should read the following discussion of our financial condition and results
of operations in conjunction with our unaudited condensed financial statements
and the related notes and other financial information included elsewhere in this
Quarterly Report on Form 10-Q and our audited consolidated financial statements
and notes thereto and management's discussion and analysis of financial
condition and results of operations for the fiscal year ended
Overview
The Berkeley Lights Platform can be used to characterize the performance of cells relevant to the desired cell-based product early in the discovery process and then connect this phenotypic data to the genetic code for each
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cell. In contrast, current genomic technologies find sequences first and fail to deliver the functional information early in the process. Performing functional validation early means letting poorly performing cells fail early while rapidly advancing the best candidates forward, before incurring significant research and development expense. Our platform repeats this process of fail and advance many times throughout the process, delivering the best cells for what we believe will deliver the best product.
Our platform is a fully integrated, end-to-end solution, comprised of advanced automation systems, proprietary consumables, including our OptoSelect chips and reagent kits, and advanced application and workflow software. Customers load onto our system their live cell samples, as well as media and reagents, then the cells are imported onto our OptoSelect chips where integrated workflows are performed to assess specific cell functions and attributes. Our platform captures and delivers rich single-cell data to find the best cells. Our platform leverages our proprietary OptoElectro Positioning ("OEP") technology, which enables deterministic positioning of living single cells and other micro-objects using light. OEP is a core technology of our platform and allows for a high level of control over live single cells or other micro-objects throughout the functional characterization process.
Our commercial workflows, each of which are distinct offerings, are made up of four modules we call Import, Culture, Assay and Export. These modules can be adapted, interchanged and deployed with a variety of single-cell assays to address specific applications and a variety of cell types. We believe this versatility facilitates rapid development of new workflow offerings and virtually unlimited workflow commercialization opportunities. We have developed and will continue to develop and commercialize proprietary workflows across large markets by leveraging existing workflows and assays. Over time, our goal is to enable customers to standardize many of their processes on our platform utilizing our workflows. We believe we are the only company commercializing a platform that can do this in a scalable way.
We commercially launched our platform in December of 2016, which included the
Beacon system and the alpha version of our
We focus a substantial portion of our resources on platform, workflow and assay development, as well as on business development and sales and marketing. Our research and development efforts are primarily focused on developing new workflows and assay capabilities, as well as new advanced systems and OptoSelect chips and reagent kits, to meet both our customers' needs and to address new markets.
We generally outsource all of our production manufacturing. Design work,
prototyping and pilot manufacturing are performed in-house before outsourcing to
third party contract manufacturers. Our outsourced production strategy is
intended to drive cost leverage and scale, and avoid the high capital outlays
and fixed costs related to constructing and operating a manufacturing facility.
The contract manufacturers of our systems are located in
Our customer base includes several of the largest biopharmaceutical companies in the world, as well as biotechnology companies, leading contract research organizations, synthetic biology companies and academic institutions. While we have seen significant growth in our customer and installed base, we believe we are still in the very early stages of platform adoption, with the majority our historical revenue derived from early adopters of our technology for research and development purposes.
We have financed our operations primarily from the issuance and sale of equity
securities, borrowings under our long-term debt agreement, and to a lesser
extent from cash generated by product and service sales. On
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(which included 1,215,000 shares that were sold pursuant to the full exercise of
the IPO underwriters' option to purchase additional shares) at a price to the
public of
Since our inception in 2011, we have incurred net losses in each year. Our net
losses were
Certain of our financial results and other key operational developments for the
three months ended
•Total revenue for the three months ended
•Gross profit in absolute dollars and gross margin for the three months ended
COVID-19 Update
The COVID-19 pandemic has had, and continues to have, a significant impact
around the world, prompting governments and businesses to take unprecedented
measures, including temporary closures of businesses, quarantines and shelter in
place orders. Pandemic related lockdowns in
Components of results of operations
Revenue
Our revenue consists of both product revenue and service revenue, which is
generated through the following revenue streams: (i) direct platform sales, (ii)
recurring revenue, and (iii) strategic partnerships and services agreements.
Sales of advanced automation systems, recurring revenue from consumables,
workflow subscription agreements, and workflow licenses are defined as product
revenue, and revenue from strategic partnership and services agreements and
extended or enhanced warranty contracts, feasibility studies and platform
support are defined as service revenue in our consolidated results of
operations. We launched our Tech Access subscription model in
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The following tables provide an overview of our revenue streams and how we report revenue in our consolidated statements of operations and comprehensive loss (in thousands):
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