Accelerate Diagnostics Reports Third Quarter 2022 Financial Results

TUCSON, Ariz., Nov. 14, 2022 /PRNewswire/ -- Accelerate Diagnostics, Inc. (Nasdaq: AXDX) today announced financial results for the third quarter for the period ended September 30, 2022.

"Our third quarter results were generally in line with my expectations," commented Jack Phillips, Chief Executive Officer of Accelerate Diagnostics, Inc.  "While I was pleased with the significant progress we made in readying for commercialization with BD and on development of our next generation AST platform, the FDA's challenge of Arc's regulatory status was an unexpected set-back. Despite this news, BD remains committed to our long-term commercial partnership."

Third Quarter 2022 Highlights

• Added 6 contracted instruments and brought 9 instruments live in the U.S. in the quarter.
• Ended the second quarter with 323 U.S. clinically live and revenue-generating instruments, with another 81 U.S. contracted instruments in the process of being implemented and not yet revenue-generating.
• Net sales were $3.0 million, compared to $3.1 million in the third quarter of the prior year, or a 3% decrease.  This decrease was driven by the timing of capital equipment sales, while recurring revenues grew by 14% compared to the same period in the prior year.
• Gross margin was 26% for the quarter, compared to 32% in the second quarter of the prior year.  The decline in gross margins resulted from inflation to manufacturing costs and other factors.
• Selling, general, and administrative (SG&A) costs for the quarter were $8.3 million, compared to $10.8 million from the same quarter of the prior year. SG&A costs for the quarter excluding non-cash stock-based compensation were $7.3 million, compared to $7.5 million from the same quarter of the prior year. SG&A was relatively unchanged over these periods. 
• Research and development (R&D) costs for the quarter were $7.3 million, compared to $4.7 million from the same quarter of the prior year. R&D costs excluding non-cash stock-based compensation expense for the quarter were $7.1 million, compared to $4.4 million from the quarter of the prior year. This increase was the result of investment in our next generation AST platform. 
• Net loss was $15.7 million in the second quarter, resulting in $0.18 net loss per share. Net loss excluding non-cash stock-based compensation expense for the second quarter was $14.5 million.
• Net cash used in the quarter excluding financing was $14.3 million.

Year-to-date 2022 Highlights

• Net sales were $9.8 million year-to-date, compared to $8.4 million from the same period of the prior year, or a 16% increase.  Growth was driven by increases in both capital and recurring revenues.
• Gross margin was 27% year-to-date, compared to 35% from the same period of the prior year.  The decline in gross margins resulted from ongoing pandemic-related impacts to manufacturing costs and other factors.
• Selling, general, and administrative (SG&A) costs year-to-date were $30.4 million, compared to $37.7 million from the same period of the prior year.  SG&A costs excluding non-cash stock-based compensation were $23.9 million year to date, compared to $23.3 million from the same period of the prior year. 
• Research and development (R&D) costs were $20.9 million year to date, compared to $17.3 million from the same period of the prior year.  R&D costs excluding non-cash stock-based compensation expense were $19.8 million year to date, compared to $13.0 million from the same period of the prior year.  This increase was the result of investment in our next generation AST platform.
• Net loss was $47.7 million year to date, resulting in $0.62 net loss per share. Net loss excluding non-cash stock-based compensation expense was $39.5 million.
• Net cash used excluding financing was $41.1 million
• Ended the quarter with total cash, investments, and cash equivalents of $55.4 million.

Full financial results for the quarter ending September 30, 2022 will be filed on Form 10-Q through the Securities and Exchange Commission's (SEC) website at http://www.sec.gov.

To listen to the 2022 third quarter financial results, call by phone, +1.877.883.0383 and enter Elite Entry Number: 5844198. International participants may dial +1.412.902.6506. Please dial in 10–15 minutes prior to the start of the conference. A replay of the call will be available by telephone at +1.877.344.7529 (U.S.) or +1.412.317.0088 (International) using the replay code 7894082 until December 5, 2022.

This conference call will also be webcast and can be accessed from the company's website at ir.axdx.com. A replay of the audio webcast will be available until February 14, 2023.

This press release contains certain financial measures that are not recognized measures under accounting principles generally accepted in the United States of America ("GAAP"), which include SG&A, R&D, and Net income (loss) amounts excluding stock-based compensation expenses. 

Our management and board of directors use expenses excluding the cost of stock-based compensation to understand and evaluate our operating performance and trends, to prepare and approve our annual budget and to develop short-term and long-term operating and financing plans. Accordingly, we believe that expenses excluding the cost of stock-based compensation provides useful information for investors in understanding and evaluating our operating results in the same manner as our management and our board of directors. Expenses excluding the cost of stock-based compensation is a non-GAAP financial measure and should be considered in addition to, not as superior to, or as a substitute for, SG&A expenses, R&D expenses, and net income (loss) reported in accordance with GAAP. The following tables present a reconciliation of SG&A expenses, R&D expenses and net income (loss) excluding stock-based compensation to comparable GAAP measures for the periods indicated:

Accelerate Diagnostics, Inc. is an in vitro diagnostics company dedicated to providing solutions for the global challenges of antibiotic resistance and sepsis. The Accelerate Pheno^® system and Accelerate PhenoTest^® BC kit combine several technologies aimed at reducing the time clinicians must wait to determine the most optimal antibiotic therapy for deadly infections. The FDA cleared system and kit fully automate the sample preparation steps to report phenotypic antibiotic susceptibility results in approximately 7 hours direct from positive blood cultures. Recent external studies indicate the solution offers results 1–2 days faster than existing methods, enabling clinicians to optimize antibiotic selection and dosage specific to the individual patient days earlier.

The "ACCELERATE DIAGNOSTICS" and "ACCELERATE PHENO" and "ACCELERATE PHENOTEST" and diamond shaped logos and marks are trademarks or registered trademarks of Accelerate Diagnostics, Inc.

For more information about the company, its products and technology, or recent publications, visit axdx.com.

Certain of the statements made in this press release are forward looking or may have forward looking implications, such as, among others, Mr. Phillip's statements regarding BD commercialization preparations, development of our next generation AST platform, and BD's commitment to our long-term commercial partnership. Actual results or developments may differ materially from those projected or implied in these forward-looking statements. Information about the risks and uncertainties faced by Accelerate Diagnostics is contained in the section captioned "Risk Factors" in the company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 14, 2022, and in any other reports that the company files with the Securities and Exchange Commission. The company's forward-looking statements could be affected by general industry and market conditions. Except as required by federal securities laws, the company undertakes no obligation to update or revise these forward-looking statements to reflect new events, uncertainties or other contingencies.

SOURCE Accelerate Diagnostics, Inc.