MAXCYTE INC

Previous wording

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our unaudited**condensed consolidated financial statements and related notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q, our audited consolidated financial statements and related notes for the year ended December 31, 2023 included in the 2023 Form 10-K, as well as the information contained under Part II, Item 1A “Risk Factors” of this Quarterly Report on Form 10-Q, “Risk Factors” contained in the 2023 Form 10-K and other information provided from time to time in our other filings with the SEC.

Current wording

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our unaudited**condensed consolidated financial statements and related notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q, our audited consolidated financial statements and related notes for the year ended December 31, 2023 included in the 2023 Form 10-K, as well as the information contained under Part II, Item 1A “Risk Factors” of this Quarterly Report on Form 10-Q, the “Risk Factors” section contained in the 2023 Form 10-K and other information provided from time to time in our other filings with the SEC.

Previous wording

You should not rely on forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Quarterly Report on Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition and operating results. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described under the caption “Risk Factors” and elsewhere in the 2023 Form 10-K. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this report. The results, events and circumstances reflected in the forward-looking statements may not be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.

Current wording

You should not rely on forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Quarterly Report on Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition and operating results. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described under the caption “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q and the 2023 Form 10-K. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this report. The results, events and circumstances reflected in the forward-looking statements may not be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.

Previous wording

Our ExPERT platform, which is based on our Flow Electroporation technology, has been designed to address this rapidly expanding cell therapy market and can be utilized across the continuum of the high-growth cell therapy sector, from discovery and development through commercialization of next-generation, cell-based medicines. The ExPERT™ family of products includes four instruments, which we call the ATx™, STx™, GTx™ and VLx™, as well as a portfolio of proprietary related disposables and consumables. Our disposables and consumables include processing assemblies (“PAs”) designed for use with our instruments, as well as accessories supporting PAs such as electroporation buffer solution and software protocols. We have garnered meaningful expertise in cell engineering via our internal research and development efforts as well as our customer-focused commercial approach, which includes a growing application scientist team. Our platform is also supported by a robust intellectual property portfolio with more than 150 granted U.S. and foreign patents and more than 95 pending patent applications worldwide.

Current wording

Our ExPERT platform, which is based on our Flow Electroporation technology, has been designed to address this rapidly expanding cell therapy market and can be utilized across the continuum of the high-growth cell therapy sector, from discovery and development through commercialization of next-generation, cell-based medicines. The ExPERT™ family of products includes four instruments, which we call the ATx™, STx™, GTx™ and VLx™, as well as a portfolio of proprietary related disposables and consumables. Our disposables and consumables include processing assemblies (“PAs”) designed for use with our instruments, as well as accessories supporting PAs such as electroporation buffer solution and software protocols. We have garnered meaningful expertise in cell engineering via our internal research and development efforts as well as our customer-focused commercial approach, which includes a growing application scientist team. Our platform is also supported by a robust intellectual property portfolio with more than 200 granted U.S. and foreign patents and more than 100 pending patent applications worldwide.

Previous wording

From leading commercial cell therapy drug and biologic developers and top biopharmaceutical companies to top academic and government research institutions, including the U.S. National Institutes of Health, our customers have extensively validated our technology. We believe the features and performance of our platform have led to sustained customer engagement. Our existing customer base, which includes but is not limited to our 28 SPL partners, ranges from large biopharmaceutical companies, including a majority of the top 25 pharmaceutical companies based on 2023 global revenue, to hundreds of biotechnology companies and academic centers focused on translational research. Our Flow Electroporation technology is used by one of our SPL partners to engineer the first ex-vivo cell therapy approved by the FDA in December 2023.

Current wording

From leading commercial cell therapy drug and biologic developers and top biopharmaceutical companies to top academic and government research institutions, including the U.S. National Institutes of Health, our customers have extensively validated our technology. We believe the features and performance of our platform have led to sustained customer engagement. Our existing customer base, which includes but is not limited to our 29 SPL partners, ranges from large biopharmaceutical companies, including a majority of the top 25 pharmaceutical companies based on 2023 global revenue, to hundreds of biotechnology companies and academic centers focused on translational research. Our Flow Electroporation technology is used by one of our SPL partners to engineer the first ex-vivo cell therapy approved by the FDA in December 2023.

Previous wording

Since our inception, we have incurred significant operating losses. Our ability to generate revenue sufficient to achieve profitability will depend on the successful further development, commercialization adoption, and market acceptance of our products. We generated revenue of $21.8 million and incurred a net loss of $18.9 million for the six months ended June 30, 2024. As of June 30, 2024, we had an accumulated deficit of $194.7 million. We expect to continue to incur net losses as we focus on growing commercial sales of our products in both the U.S. and international markets, including growing our sales force, scaling our manufacturing operations, and continuing research and development efforts to develop new products and further enhance our existing products.

Current wording

Since our inception, we have incurred significant operating losses. Our ability to generate revenue sufficient to achieve profitability will depend on the successful further development, commercialization adoption, and market acceptance of our products. We generated revenue of $29.9 million and incurred a net loss of $30.5 million for the nine months ended September 30, 2024. As of September 30, 2024, we had an accumulated deficit of $206.3 million. We expect to continue to incur net losses as we focus on growing commercial sales of our products in both the U.S. and international markets, including growing our sales force, scaling our manufacturing operations, and continuing research and development efforts to develop new products and further enhance our existing products.

Previous wording

Throughout the first half of 2024, we have continued to enter into SPL agreements with our cell therapy customers. These agreements, which are discussed in more detail under the caption “Results of Operations” below, provide us with revenue from instrument sales and leases and disposables sales as well as pre-commercial milestones based on progress of our partners’ programs through the clinic and sales-based payments upon commercialization of our partners’ programs. In the

Current wording

We have continued to enter into SPL agreements with our cell therapy customers. These agreements, which are discussed in more detail under the caption “Results of Operations” below, provide us with revenue from instrument sales and leases and disposables sales as well as pre-commercial milestones based on progress of our partners’ programs through the clinic and sales-based payments upon commercialization of our partners’ programs. In the first three quarters of 2024, we signed SPL agreements with six new partners: Lion TCR, Imugene, and Wugen in January, Be Biopharma in March, Legend Biotech in May, and Kamau Therapeutics in September. We continue to grow our SPL pipeline and, while the specific timing of any agreement is uncertain, we look forward to continuing to build on our existing SPL partnerships and develop additional SPL partnerships in the future.

Previous wording

Total core revenue for the three months ended June 30, 2024 was $7.6 million, a decrease of $0.7 million, or 9%, compared to $8.3 million for the three months ended June 30, 2023. Our overall decrease in core revenue was primarily driven by decreases in instrument sales and disposable sales of $0.4 million and $0.3 million, respectively.

Current wording

Total core revenue for the three months ended September 30, 2024 was $8.1 million, an increase of $1.5 million, or 23%, compared to $6.6 million for the three months ended September 30, 2023. Our overall increase in core revenue was primarily driven by increases in disposable sales of $1.2 million, and an aggregate increase of other components of core revenue of $0.3 million.

Previous wording

The $2.1 million increase in program-related revenues for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 resulted from achievement of contractually specified clinical and regulatory milestones and reflects the expected variability from period to period in the level of program-related revenue given the small number of individual triggering events which currently generate this portion of revenue. We expect program-related revenue to continue to experience variability for some time, although we anticipate that variability may moderate as the volume of SPL partnerships and associated milestones grows.

Current wording

The $1.4 million decrease in program-related revenues for the three months ended September 30, 2024 compared to the three months ended September 30, 2023 resulted from the variability in achievement of contractually specified clinical and regulatory milestones during the three months ended September 30, 2023 and reflects the expected variability from period to period in the level of program-related revenue given the small number of individual triggering events which currently generate this portion of revenue. We expect program-related revenue to continue to experience variability for some time, although we anticipate that variability may moderate as the volume of SPL partnerships and associated milestones grows and matures.

Previous wording

We expect total revenue to increase over time as our customers’ programs advance and our markets grow, resulting in additional instrument sales and leases and disposable sales and also as the percentage of our installed base that are under cell therapy license agreements increases. We expect revenue from disposable and instrument sales and instrument licenses to cell therapy customers will continue to grow as those customers advance their preclinical pipeline programs into clinical development and move their existing drug development programs into later-stage clinical trials and, potentially, into commercialization. In addition, we believe we are well positioned to attract new customers who may contribute to these revenues, based on the underlying growth in the cell therapy pipeline among companies in this market, the extent to which capital is available to support such companies, and in particular the switch by some cell therapy companies away from viral to non-viral approaches. We expect, however, that our revenue may fluctuate from period to period due to the timing of securing product sales and licenses, the inherently uncertain nature of the timing of our partners’ achievements of clinical progress and our dependence on the program decisions of our partners.

Current wording

We expect total revenue to increase over time as our customers’ programs advance and our markets grow, resulting in additional instrument sales and leases and disposable sales and also as the percentage of our installed base that are under cell therapy license agreements increases. We expect revenue from disposable and instrument sales and instrument licenses to cell therapy customers will continue to grow as those customers advance their preclinical pipeline programs into clinical development and move their existing drug development programs into later-stage clinical trials and, potentially, into commercialization. In addition, we believe we are well-positioned to attract new customers who may contribute to these revenues, based on the underlying growth in the cell therapy pipeline among companies in this market, the extent to which capital is available to support such companies, and in particular the switch by some cell therapy companies away from viral to non-viral approaches. We expect, however, that our revenue may fluctuate from period to period due to the timing

Previous wording

During the three months ended June 30, 2024, gross margin was 86% compared to 85% for the three months ended June 30, 2023. The increase in gross margin was due to an increase in program-related revenue, offset by an increase in cost of goods sold described below. We price our instruments at a premium given what we believe to be the broad benefits of our platform, and the limited availability of alternative clinically-validated non-viral delivery approaches. Instrument pricing also depends upon the customer’s specific market. However, the market for non-viral delivery is highly competitive, and introduction of a Good Manufacturing Practices (“GMP”) grade platform by a competitor that delivers similar performance across a similar diversity of cell types could negatively impact our business and lead to increased price pressure that negatively impacts our gross margins.

Current wording

During the three months ended September 30, 2024, gross margin was 76% compared to 90% for the three months ended September 30, 2023. The decrease in gross margin was primarily due to an increase in cost of goods sold, described below, and a decrease in program-related revenue. We price our instruments at a premium given what we believe to be the broad benefits of our platform, and the limited availability of alternative clinically-validated non-viral delivery approaches. Instrument pricing also depends upon the customer’s specific market. However, the market for non-viral delivery is highly competitive, and introduction of a Good Manufacturing Practices (“GMP”) grade platform by a competitor that delivers similar performance across a similar diversity of cell types could negatively impact our business and lead to increased price pressure that negatively impacts our gross margins.

Previous wording

Cost of goods sold increased by $0.1 million, or 8%, for the three months ended June 30, 2024 compared to the three months ended June 30, 2023. The increase was primarily driven by lower absorption of manufacturing overhead costs and an increase in inventory reserves.

Current wording

Cost of goods sold increased by $1.1 million, or 143%, for the three months ended September 30, 2024 compared to the three months ended September 30, 2023. The increase was primarily driven by increases in disposable sales, an increase in inventory reserves, and lower absorption of manufacturing overhead costs.

Previous wording

Gross profit increased by $1.3 million, or 17%, for the three months ended June 30, 2024 compared to the three months ended June 30, 2023. The increase was primarily driven by an increase in program-related revenue for the three months ended June 30, 2024 offset by an increase in cost of goods sold described above.

Current wording

Gross profit decreased by $1.0 million, or 14%, for the three months ended September 30, 2024 compared to the three months ended September 30, 2023. The decrease was primarily driven by the increase in cost of goods sold described above, and a decrease in program-related revenue.

Previous wording

Research and development expenses consist primarily of costs incurred for our research activities related to advancing our technology and development of applications for our technology, including research into specific applications and associated data development, process development, product development (e.g., development of instruments and

Current wording

Research and development expenses consist primarily of costs incurred for our research activities related to advancing our technology and development of applications for our technology, including research into specific applications and associated data development, process development, product development (e.g., development of instruments and disposables, including hardware and software engineering) and design and other costs not directly charged to inventory or cost of goods sold.

Previous wording

We believe that our continued investment in research and development is essential to our long-term competitive position. We expect to continue to incur substantial research and development expenses as we invest in research and development to support our customers, develop new uses for our existing technology, and develop improved and/or new offerings for our customers and partners. As a result, we expect that our research and development expenses will continue to increase in absolute dollars in future periods and vary from period to period as a percentage of revenue.

Current wording

We believe that our continued investment in research and development is essential to our long-term competitive position. We expect to continue to incur substantial research and development expenses as we invest in research and development to support our customers, develop new uses for our existing technology, and develop improved and/or new offerings for our customers and partners. As a result, we expect that our research and development expenses will continue to fluctuate in absolute dollars in future periods and vary from period to period as a percentage of revenue.

Previous wording

General and administrative expenses primarily consist of salaries, benefits, stock-based compensation and travel costs for employees in our executive, accounting and finance, legal, corporate development, human resources, information systems, and office administration functions as well as professional services fees, such as consulting, audit, tax and legal fees, general corporate costs, facilities and allocated overhead expenses, and public company fees associated with being a Nasdaq and AIM-listed public company such as director fees, U.K. Nominated Adviser and broker fees, investor relations consultants fees and insurance costs. These expenses are exclusive of depreciation and amortization.

Current wording

General and administrative expenses primarily consist of salaries, benefits, stock-based compensation and travel costs for employees in our executive, accounting and finance, legal, corporate development, human resources, information systems, and office administration functions as well as professional services fees, such as consulting, audit, tax and legal fees,

Previous wording

Sales and marketing expenses increased by $0.2 million, or 3%, for the three months ended June 30, 2024 compared to the three months ended June 30, 2023. The increase was primarily driven by a $0.5 million increase in compensation expenses, and a $0.1 million increase in professional fees, offset by a $0.3 million decrease in occupancy expenses.

Current wording

General and administrative increased $0.9 million, or 14% for the three months ended September 30, 2024 compared to the three months ended September 30, 2023. The increase was primarily driven by a $0.6 million increase in legal expense, a $0.2 million increase in stock-based compensation, a $0.1 million increase in public company expenses, and a $0.1 million increase in occupancy expenses, offset by a $0.1 million decrease in compensation expense.

Previous wording

Interest income represents interest on our cash balances and investments, Interest income remained flat at $2.6 million for the three months ended June 30, 2024 compared to June 30, 2023.

Current wording

Interest income represents interest on our cash balances and investments, Interest income decreased $0.2 million, 8% for the three months ended September 30, 2024 compared to the three months ended September 30, 2023. The decrease was driven by decreases in interest rates and average cash and investment balances during the three months ended September 30, 2024.

Previous wording

Total revenue for the six months ended June 30, 2024 was $21.8 million, an increase of $4.2 million, or 24%, compared to revenue of $17.6 million during the six months ended June 30, 2023. The increase was driven by an increase in program-related revenue.

Current wording

Total revenue for the nine months ended September 30, 2024 was $29.9 million, an increase of $4.3 million, or 17%, compared to revenue of $25.6 million during the nine months ended September 30, 2023. The increase was primarily driven by an increase in disposables revenue and program-related revenue.

Previous wording

Total core revenue for the six months ended June 30, 2024 was $15.8 million, a decrease of $0.3 million, or 2%, compared to core revenue of $16.1 million for the six months ended June 30, 2023. Our overall decrease in core revenue was primarily driven by decreases in instrument sales and lease revenue of $0.6 million and $0.3 million, respectively, offset by an increase in disposable sales and other revenue of $0.5 million and $0.1 million, respectively.

Current wording

Total core revenue for the nine months ended September 30, 2024 was $23.9 million, an increase of $1.2 million, or 5%, compared to core revenue of $22.7 million for the nine months ended September 30, 2023. Our overall increase in core revenue was primarily driven by increases in disposable sales and other revenue of $1.7 million and $0.2 million, respectively, offset by decreases in instrument sales and lease revenue of $0.5 million and $0.2 million, respectively.

Previous wording

During the six months ended June 30, 2024, gross margin remained flat at 87% compared to the three months ended June 30, 2023.

Current wording

During the nine months ended September 30, 2024, gross margin was 84%, compared to 88% compared to the nine months ended September 30, 2023.

Previous wording

Cost of goods sold increased by $0.5 million, or 22%, for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase was primarily driven by lower absorption of manufacturing overhead costs and an increase in inventory reserves.

Current wording

Cost of goods sold increased by $1.7 million, or 52%, for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. The increase was primarily driven by increases in disposable sales, an increase in inventory reserves, and lower absorption of manufacturing overhead costs.

Previous wording

Gross profit increased by $3.6 million, or 24%, for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase was primarily driven by an increase in program-related revenue for the six months ended June 30, 2024 offset by increases to cost of goods sold described above.

Current wording

Gross profit increased by $2.7 million, or 12%, for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. The increase was primarily driven by an increase in program-related revenue for the nine months ended September 30, 2024 offset by increases to cost of goods sold described above.

Previous wording

Research and development expenses increased by $0.6 million, or 5%, for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase was primarily driven by a $0.8 million increase in compensation expense, a $0.5 million increase in lab expense, and a $0.3 million increase in occupancy expense, offset by a $0.6 million decrease in stock-based compensation, a $0.2 million decrease in engineering expenses, and a $0.2 million decrease in professional fees and other expenses.

Current wording

Research and development expenses decreased by $0.4 million, or 2%, for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. The decrease was primarily driven by a $1.1 million decrease in stock-based compensation, and a $0.4 million decrease in engineering expenses, offset by a $0.8 million increase in compensation expenses, and a $0.5 million increase in occupancy expense.

Previous wording

Sales and marketing expenses increased by $1.2 million, or 10%, for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The increase was primarily driven by a $1.2 million increase in compensation expenses as a result of increases in headcount, and a $0.5 million increase in professional fees, offset by a $0.3 million decrease in occupancy expenses and a $0.2 million decrease in marketing expenses.

Current wording

Sales and marketing expenses increased by $0.4 million, or 2%, for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. The increase was primarily driven by a $1.1 million increase in compensation expenses, a $0.6 million increase in professional fees, offset by a $0.2 million decrease in stock-based compensation, a $0.6 million decrease in occupancy expenses and a $0.5 million decrease in marketing expenses.

Previous wording

General and administrative expenses decreased by $0.4 million, or 3%, for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The decrease was primarily driven by a $0.9 million decrease in professional services and a $0.1 million decrease in compensation expenses, offset by an increase in stock-based compensation of $0.6 million.

Current wording

General and administrative expenses increased by $0.5 million, or 2%, for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. The increase was primarily driven by an increase in stock-based compensation of $0.8 million, and an increase in legal fees of $0.6 million, and an increase in travel and occupancy expenses of $0.3 million, offset by a $0.9 million decrease in professional services and a $0.3 million decrease in compensation expenses.

Previous wording

Depreciation and amortization expense increased by $0.2 million, or 11%, for the six months ended June 30, 2024, compared to the six months ended June 30, 2023. The increase was primarily driven by increases in leasehold improvements and purchases in laboratory equipment.

Current wording

Depreciation and amortization expense increased by $0.2 million, or 7%, for the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023. The increase was primarily driven by increases in leasehold improvements and purchases in laboratory equipment.

Previous wording

Interest income represents interest on our cash balances and investments, which increased by $0.5 million, or 10%, for the six months ended June 30, 2024 compared to June 30 2023. The increase was driven by increases in interest rates during the six months ended June 30, 2024.

Current wording

Interest income represents interest on our cash balances and investments, which increased by $0.3 million, or 4%, for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. The increase was driven by increases in interest rates during the nine months ended September 30, 2024.

Previous wording

Since our inception, we have experienced losses and negative cash flows from operations. For the six months ended June 30, 2024, we incurred a net loss of $18.9 million. As of June 30, 2024, we had an accumulated deficit of $194.7 million. To date, we have funded our operations primarily with proceeds from sales of common stock, borrowings under loan agreements and cash flows associated with sales and licenses of our products to customers. On August 3, 2021, we completed our U.S. IPO, generating gross proceeds of $201.8 million. We received net proceeds of $184.3 million after deducting aggregate underwriting commissions and offering expenses of $17.6 million.

Current wording

Since our inception, we have experienced losses and negative cash flows from operations. For the nine months ended September 30, 2024, we incurred a net loss of $30.5 million. As of September 30, 2024, we had an accumulated deficit of $206.3 million. To date, we have funded our operations primarily with proceeds from sales of common stock, borrowings under loan agreements and cash flows associated with sales and licenses of our products to customers. On August 3, 2021, we completed our U.S. IPO, generating gross proceeds of $201.8 million. We received net proceeds of $184.3 million after deducting aggregate underwriting commissions and offering expenses of $17.6 million.

Previous wording

Net cash used in operating activities for the six months ended June 30, 2024 was $15.4 million, and consisted primarily of our net loss of $18.9 million, which was offset in part by net non-cash expenses of $5.7 million. Net non-cash expenses include stock-based compensation of $6.6 million, depreciation and amortization expenses of $2.2 million, and an aggregate $0.6 million in other non-cash charges offset by amortization of discounts on investments of $3.7 million. We also had net cash outflows of $2.2 million due to changes in our operating assets and liabilities. Net changes in our operating assets and liabilities consisted primarily of a decrease in accounts payable and accrued expenses of $3.5 million due to timing considerations, a decrease in deferred revenue of $1.7 million, an increase in other assets of $0.3 million, and a decrease in operating lease liabilities of $0.2 million, offset by a decrease in prepaid expenses and other current assets of $1.3 million, a decrease in accounts receivable of $1.3 million, and a decrease in inventory of $0.8 million.

Current wording

Net cash used in operating activities for the nine months ended September 30, 2024 was $19.8 million, and consisted primarily of our net loss of $30.5 million, which was offset in part by net non-cash expenses of $9.7 million. Net non-cash expenses include stock-based compensation of $9.9 million, depreciation and amortization expenses of $3.3 million, an increase to our excess and obsolete inventory reserve of $0.8 million, and an aggregate $0.7 million in other non-cash charges offset by amortization of discounts on investments of $5.1 million. We also had net cash inflows of $1.0 million due to changes in our operating assets and liabilities. Net changes in our operating assets and liabilities consisted primarily of an increase in deferred revenue of $1.6 million, a decrease in accounts receivable of $1.3 million, and a decrease in inventory of $0.8 million, offset by a decrease in accounts payable and accrued expenses of $1.4 million due to timing considerations, an increase in other assets of $0.7 million, a decrease in operating lease liabilities of $0.4 million and an increase in prepaid expenses and other current assets of $0.2 million.

Previous wording

Net cash used in operating activities for the six months ended June 30, 2023 was $14.4 million, and consisted primarily of our net loss of $21.4 million, offset in part by net non-cash expenses of $5.6 million, including stock-based compensation of $6.8 million, depreciation and amortization expenses of $2.0 million, and other non-cash charges of $0.4 million, offset by amortization of discounts on investments of $3.6 million. We also had net cash inflows of $1.3 million due to changes in our operating assets and liabilities. Net changes in our operating assets and liabilities consisted primarily of a decrease in accounts receivable of $4.0 million due to increased cash collections, a decrease in tenant improvements allowance (“TIA”) receivable of $1.9 million, a decrease in prepaid expenses and other current assets of $0.7 million, a decrease in other assets of $0.2 million, and an increase of $0.1 million in operating lease liabilities, offset by a $2.5 million increase in inventory, a decrease in deferred revenue of $2.0 million, and a $1.0 million decrease in accounts payable and accrued expenses.

Current wording

Net cash used in operating activities for the nine months ended September 30, 2023 was $22.7 million, and consisted primarily of our net loss of $32.6 million, offset in part by net non-cash expenses of $8.9 million, including stock-based compensation of $10.4 million, depreciation and amortization expenses of $3.1 million, and other non-cash charges of $0.6 million, offset by amortization of discounts on investments of $5.1 million. We also had net cash inflows of $1.0 million due to changes in our operating assets and liabilities. Net changes in our operating assets and liabilities consisted primarily of a decrease in accounts receivable of $3.6 million due to increased cash collections, a decrease in tenant improvements allowance (“TIA”) receivable of $1.9 million, an increase in accounts payable and accrued expenses of $1.5 million, and a decrease in other assets of $0.2 million, offset by a $4.1 million increase in inventory, a decrease in deferred revenue of $1.1 million, and a $0.9 million increase in prepaid expenses and other current assets.

Previous wording

Net cash provided by investing activities during the six months ended June 30, 2024 was $5.0 million, which was primarily due maturities of investments of $85.4 million, offset by purchases of investments of $79.4 million and purchases of property and equipment of $1.1 million.

Current wording

Net cash provided by investing activities during the nine months ended September 30, 2024 was $8.6 million, which was primarily attributable to maturities of investments of $128.4 million, offset by purchases of investments of $118.3 million and purchases of property and equipment of $1.5 million.

Previous wording

Net cash provided by investing activities during the six months ended June 30, 2023 was $56.3 million, which was primarily attributable to maturities of investments of $163.3 million, partially offset by purchases of investments of $105.0 million and purchases of property and equipment of $2.1 million.

Current wording

Net cash provided by investing activities during the nine months ended September 30, 2023 was $59.1 million, which was primarily attributable to maturities of investments of $247.5 million, partially offset by purchases of investments of $185.6 million and purchases of property and equipment of $2.8 million.

Previous wording

Net cash provided by financing activities during the six months ended June 30, 2024 was $1.4 million, which was attributable to proceeds from the exercise of stock options and employee purchases from our employee stock purchase plan.

Current wording

Net cash provided by financing activities during the nine months ended September 30, 2024 was $1.6 million, which was attributable to proceeds from the exercise of stock options and employee purchases from our employee stock purchase plan.

Previous wording

Net cash provided by financing activities during the six months ended June 30, 2023 was $1.6 million, which was attributable to proceeds from the exercise of stock options.

Current wording

Net cash provided by financing activities during the nine months ended September 30, 2023 was $1.7 million, which was attributable to proceeds from the exercise of stock options.

Previous wording

Our contractual obligations and commitments as of June 30, 2024 consisted exclusively of operating lease obligations. In May 2021, we entered into the Headquarters Lease for new office, lab and warehouse/manufacturing space. The Headquarters Lease term expires on August 31, 2035. The total incremental remaining non-cancellable lease payments under the lease agreement are $27.2 million through the lease term. We expect to be able to fund our obligations under this lease, both in the short-term and in the long-term, from cash on hand, investments and operating cash flows.

Current wording

Our contractual obligations and commitments as of September 30, 2024 consisted exclusively of operating lease obligations. In May 2021, we entered into the Headquarters Lease for new office, lab and warehouse/manufacturing space. The Headquarters Lease term expires on August 31, 2035. The total incremental remaining non-cancellable lease payments under the lease agreement are $26.7 million through the lease term. We expect to be able to fund our obligations under this lease, both in the short-term and in the long-term, from cash on hand, investments and operating cash flows.