Seer Inc (SEER) Q3 2024 Earnings Call Highlights: Navigating Challenges with Strategic ...

GuruFocus.com
07 Nov 2024
  • Revenue: $4 million for Q3 2024, a 3% decrease from $4.2 million in Q3 2023.
  • Product Revenue: $3.1 million, including $180,000 from related parties.
  • Service Revenue: $847,000, including $186,000 from related parties.
  • Gross Profit: $1.9 million with a gross margin of 48%.
  • Operating Expenses: $26.3 million, including $6.1 million in stock-based compensation.
  • Net Loss: $21.3 million for Q3 2024.
  • Cash and Investments: Approximately $312 million at the end of Q3 2024.
  • Free Cash Flow Loss: Approximately $39 million for the nine months ended September 30, 2024.
  • 2024 Revenue Outlook: Expected to be in the range of $13 million to $15 million.
  • Warning! GuruFocus has detected 4 Warning Sign with SEER.

Release Date: November 06, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Seer Inc (NASDAQ:SEER) reported $4 million in revenue for the third quarter, with approximately $312 million in cash, cash equivalents, and investments.
  • The company has seen multiple large orders from government agencies and strong interest in their proteograph product suite.
  • Seer Inc (NASDAQ:SEER) announced a partnership with Thermo Fisher Scientific to co-market and sell the proteograph product suite, enhancing accessibility to life science researchers worldwide.
  • The company has expanded its geographic reach with a new stack lab in Germany, meeting increasing demand from European researchers.
  • Seer Inc (NASDAQ:SEER) has a strong pipeline heading into the end of the year, with strategic initiatives expected to drive growth in 2025 and beyond.

Negative Points

  • Total revenue for the third quarter of 2024 decreased by 3% compared to the same period in 2023, primarily due to a decrease in related party and grant revenue.
  • The company continues to face a challenging capital purchasing environment, impacting sales cycles for new instrumentation.
  • Gross profit for the third quarter of 2024 was $1.9 million, representing a gross margin of 48%, down from 52% in the third quarter of 2023.
  • Net loss for the third quarter of 2024 was $21.3 million, slightly higher than the $21.1 million loss in the third quarter of 2023.
  • Seer Inc (NASDAQ:SEER) continues to navigate a challenging funding environment, impacting the adoption of new technology and overall financial performance.

Q & A Highlights

Q: Given the midpoint of your 2024 guidance of $14 million, it seems to imply a flat or slightly negative sequential step down from Q3 to Q4. Can you talk about your assumptions surrounding this? A: (David Horn, CFO) The guidance reflects timing issues with our pipeline opportunities. If deals close favorably, we could hit the high end of the range, but delays could affect outcomes. We continue to see budget pressures and are not forecasting a budget flush for Q4, which may seem conservative but reflects our current position.

Q: Has the expansion of your sales and marketing team driven the beat this quarter, and when can we expect benefits from this initiative to flow through to the P&L? A: (Omid Farokhzad, CEO) The expansion, including new regional business managers and a VP of global marketing, is ramping up and creating opportunities. We expect to see benefits later this year and into 2025.

Q: What is driving the shift towards academic customers, and how does it relate to publications and capital constraints from larger BioPharma customers? A: (Omid Farokhzad, CEO) The shift is partly due to increased evidence and publications, allowing academics to secure funding. While commercial customers face capital constraints, the growing data and evidence are driving larger studies, with more academic opportunities emerging.

Q: How should we think about the evolution of the affinity-based proteomics market as more solutions become available? A: (Omid Farokhzad, CEO) The proteomics market is growing, with untargeted approaches like ours becoming more viable. Targeted approaches will coexist, driven by the discovery of new content through untargeted methods, creating a flywheel effect that expands the market.

Q: How do you anticipate your collaboration with Thermo Fisher will impact Seer's market reach and top line? A: (Omid Farokhzad, CEO) The partnership with Thermo Fisher is well-timed, leveraging their sales process to potentially shorten our sales cycle. Customers focusing on biofluids like plasma will benefit most, as our product significantly enhances protein detection in these samples.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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