Natera Inc

Previous wording

We currently provide a comprehensive suite of products in women’s health, as well as our oncology and organ health products, and our Constellation cloud-based platform. We generate a majority of our revenues from the sale of Panorama, our non-invasive prenatal test, or NIPT, as well as Horizon, our Carrier Screening, test. In addition to Panorama and Horizon, our product offerings in women’s health include Spectrum Preimplantation Genetics, our Anora miscarriage test, and Vistara single-gene NIPT, as well as our Empower hereditary cancer screening test, which we also plan to offer to oncologists through our oncology sales channel. We also offer our Signatera molecular residual disease test for oncology applications, which we commercialized as a test run in our CLIA (as defined below) laboratory and offer on a research use only basis to research laboratories and pharmaceutical companies; and our Prospera organ transplant assessment tests.

Current wording

We currently provide a comprehensive suite of products in women’s health, as well as our oncology and organ health products, and our Constellation cloud-based platform. We generate a majority of our revenues from the sale of Panorama, our non-invasive prenatal test, or NIPT, as well as Horizon, our Carrier Screening, test. In addition to Panorama and Horizon, our product offerings in women’s health include Spectrum Preimplantation Genetics, our Anora miscarriage test, and Vistara single-gene NIPT, as well as our Empower hereditary cancer screening test, which we also plan to offer to oncologists through our oncology sales channel. We also offer our Signatera molecular residual disease test for oncology applications, which we commercialize as a test run in our CLIA (as defined below) laboratory and offer on a research use only basis to research laboratories and pharmaceutical companies; and our Prospera organ transplant assessment tests.

Previous wording

We process tests in our laboratories certified under the Clinical Laboratory Improvement Amendments of 1988 (or CLIA) in Austin, Texas and San Carlos, California. A portion of our testing is performed by third-party laboratories. Our customers include independent laboratories, national and regional reference laboratories, medical centers and physician practices for our screening tests, research laboratories and pharmaceutical companies. We market and sell our tests through our direct sales force and, for our women’s health tests, through our laboratory distribution partners. We bill clinics, laboratory distribution partners, patients, pharmaceutical companies and insurance payers for the tests we perform. In cases where we bill laboratory distribution partners, our partners in turn bill clinics, patients and insurers. The majority of our revenue comes from insurers with whom we have in-network contracts. Such insurers reimburse us for our tests pursuant to our in-network contracts with them, based on positive coverage determinations, which means that the insurer has determined that the test in general is medically necessary for this category of patient.

Current wording

We process tests in our laboratories certified under the Clinical Laboratory Improvement Amendments of 1988, or CLIA, in Austin, Texas and San Carlos, California. A portion of our testing is performed by third-party laboratories. Our customers include independent laboratories, national and regional reference laboratories, medical centers and physician practices for our screening tests, and research laboratories and pharmaceutical companies. We market and sell our tests through our direct sales force and, for our women’s health tests, through our laboratory distribution partners. We bill clinics, laboratory distribution partners, patients, pharmaceutical companies and insurance payers for the tests we perform. In cases where we bill laboratory distribution partners, our partners in turn bill clinics, patients and insurers. The majority of our revenue comes from insurers with whom we have in-network contracts. Such insurers reimburse us for our tests pursuant to our in-network contracts with them, based on positive coverage determinations, which means that the insurer has determined that the test in general is medically necessary for this category of patient.

Previous wording

During the nine months ended September 30, 2024, we processed approximately 2,271,800 tests, comprised of approximately 2,223,500 tests accessioned in our laboratory, compared to approximately 1,869,400 tests processed, comprised of approximately 1,816,500 tests accessioned in our laboratory, during the nine months ended September 30, 2023. This increase in volume primarily represents continued commercial growth of Signatera, Panorama and Horizon, both as tests performed in our laboratory as well as through our Constellation software platform.

Current wording

During the three months ended March 31, 2025, we processed approximately 855,100 tests, comprised of approximately 840,800 tests accessioned in our laboratory, compared to approximately 735,800 tests processed, comprised of approximately 718,700 tests accessioned in our laboratory, during the three months ended March 31, 2024. This increase in volume primarily represents continued commercial growth of Signatera, Panorama and Horizon, both as tests performed in our laboratory as well as through our Constellation software platform.

Previous wording

The percent of our revenues attributable to our U.S. direct sales force for the nine months ended September 30, 2024 was 94%, an increase compared to 91% for the nine months ended September 30, 2023. The percent of our revenues attributable to U.S. laboratory distribution partners for the nine months ended September 30, 2024 was 3%, a decrease compared to 6% from the same period in the prior year. Our ability to increase our revenues and gross profit will depend on our ability to further penetrate the U.S. market with our direct sales force. The percent of our revenues attributable to international laboratory distribution partners and other international sales for both the nine months ended September 30, 2024 and 2023 was 3%.

Current wording

The percent of our revenues attributable to our U.S. direct sales force for the three months ended March 31, 2025 was 96%, an increase compared to 94% for the three months ended March 31, 2024. The percent of our revenues attributable to U.S. laboratory distribution partners for the three months ended March 31, 2025 was 2%, a decrease compared to 5% from the same period in the prior year. Our ability to increase our revenues and gross profit will depend on our ability to further penetrate the U.S. market with our direct sales force. The percent of our revenues attributable to international laboratory distribution partners and other international sales for the three months ended March 31, 2025 was 2%, approximately the same as in the three months ended March 31, 2024.

Previous wording

For the nine months ended September 30, 2024, total revenues were $1,220.9 million compared to $771.5 million in the nine months ended September 30, 2023. Product revenues accounted for $1,212.2 million, 99% of total revenues for the nine months ended September 30, 2024 compared to $761.3 million representing 99% of total revenues for the nine months ended September 30, 2023. For the nine months ended September 30, 2024 and 2023, no customers exceeded 10% of the total revenues on an individual basis. Revenues from customers outside the United States were $30.3 million, representing approximately 3% of total revenues for the nine months ended September 30, 2024. For the nine months ended September 30, 2023, revenues from customers outside the United States were $25.0 million, representing approximately 3% total revenues. Most of our revenues have been denominated in U.S. dollars, though we generate some revenue in foreign currency, primarily denominated in Euros and Singapore Dollars.

Current wording

For the three months ended March 31, 2025, total revenues were $501.8 million compared to $367.7 million in the three months ended March 31, 2024. Product revenues accounted for $500.0 million, nearly 100% of total revenues for the three months ended March 31, 2025 compared to $364.7 million representing 99% of total revenues for the three months ended March 31, 2024. For the three months ended March 31, 2025 and 2024, no customers exceeded 10% of the total revenues on an individual basis. Revenues from customers outside the United States were $9.5 million, representing approximately 2% of total revenues for the three months ended March 31, 2025. For the three months ended March 31, 2024, revenues from customers outside the United States were $8.3 million, representing approximately 2% total revenues. Most of our revenues have been denominated in U.S. dollars, though we generate some revenue in foreign currency, primarily denominated in Euros and Singapore Dollars.

Previous wording

Our net loss for the nine months ended September 30, 2024 and 2023 was $136.7 million and $356.8 million, respectively. This included non-cash stock compensation expense of $202.5 million and $142.4 million for the nine months ended September 30, 2024 and 2023, respectively. As of September 30, 2024, we had an accumulated deficit of $2.5 billion.

Current wording

Our net loss for the three months ended March 31, 2025 and 2024 was $66.9 million and $67.6 million, respectively. This included non-cash stock compensation expense of $77.8 million and $64.4 million for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, we had an accumulated deficit of $2.6 billion.

Previous wording

Our ability to increase our revenues will depend on our ability to further penetrate the domestic and international markets and, in particular, generate sales through our direct sales force, develop and commercialize additional tests, obtain reimbursement from additional third-party payers and increase our reimbursement rates for tests performed. For example, our financial performance depends on reimbursement for microdeletions testing. Many third-party payers do not currently reimburse for microdeletions screening in part because there has historically been limited published data on the performance of microdeletions screening tests, with our single nucleotide polymorphism-based Microdeletion and Aneuploidy RegisTry, or SMART study results only being published in early 2022.

Current wording

Our ability to increase our revenues will depend on our ability to further penetrate the domestic and international markets and, in particular, generate sales through our direct sales force, develop and commercialize additional tests, obtain reimbursement from additional third-party payers and increase our reimbursement rates for tests performed. For example, our financial performance depends on reimbursement for microdeletions testing. Many third-party payers do not currently reimburse for microdeletions screening in part because there has historically been limited published data on the performance of microdeletions screening tests, with oursingle nucleotide polymorphism-based Microdeletion and Aneuploidy RegisTry, or SMART study results only being published in early 2022.

Previous wording

The components of our cost of product revenues are material and service costs, impairment charges associated with testing equipment, personnel costs, including stock-based compensation expense, equipment and infrastructure expenses associated with testing samples, electronic medical records, order and delivery systems, shipping charges to transport samples, costs incurred from third party test processing fees, and allocated overhead such as rent, information technology costs, equipment depreciation and utilities. Costs associated with Whole Exome Sequencing, are also included, as well as labor costs, relating to our Signatera CLIA and Signatera research use only offerings. Costs associated with performing tests are recorded when the test is accessioned. We expect cost of product revenues in absolute dollars to increase as the number of tests we perform increases.

Current wording

The components of our cost of product revenues are material and service costs, impairment charges associated with testing equipment, personnel costs, including stock-based compensation expense, equipment and infrastructure expenses associated with testing samples, electronic medical records, order and delivery systems, shipping charges to transport samples, costs incurred from third party test processing fees, and allocated overhead such as rent, information technology costs, equipment depreciation and utilities. Costs associated with Whole Exome Sequencing, are also included, as well as labor costs, relating to our Signatera CLIAand Signatera research use only offerings. Costs associated with performing tests are recorded when the test is accessioned. We expect cost of product revenues in absolute dollars to increase as the number of tests we perform increases.

Previous wording

We consider our cost of licensing and other revenues for the Constellation software platform to be relatively low, and therefore we expect its associated gross margin to be higher. We expect our cost of licensing will increase in relation to volume growth.

Current wording

We consider our cost of licensing and other revenues for the Constellation software platform to be relatively low, and therefore we expect its associated gross margin is higher. We expect our cost of licensing will increase in relation to volume growth.

Previous wording

Interest expense is attributable to borrowing under our Convertible Senior Notes (the “Convertible Notes”) and credit line with UBS (the “Credit Line”), including the amortization of debt discounts.

Current wording

Interest expense is attributable to borrowing under our Convertible Senior Notes (the “Convertible Notes”) and our credit line with UBS (the “Credit Line”), including the amortization of debt discounts.

Previous wording

Interest income and other (expense) income, net is comprised of interest earned on our cash, realized gains and losses on investments and assets, sublease rental income, and foreign currency remeasurement gains and losses.

Current wording

Interest income and other (expense) income, net is comprised of interest earned on our cash; realized gains and losses on investments and assets; sublease rental income; and warrant, preferred shares and foreign currency remeasurement gains and losses.

Previous wording

Total revenues are comprised of product revenues, which are primarily driven by sales of our Panorama and Horizon tests, oncology testing, and licensing and other revenues, which primarily includes development licensing revenue and licensing of our Constellation software. Total revenues for the three months ended September 30, 2024 increased by $171.5 million, or 63.9%, when compared to the three months ended September 30, 2023.

Current wording

Total revenues are comprised of product revenues, which are primarily driven by sales of our Panorama and Horizon tests, oncology testing, and licensing and other revenues, which primarily includes development licensing revenue and licensing of our Constellation software. Total revenues for the three months ended March 31, 2025 increased by $134.1 million, or 36.5%, when compared to the three months ended March 31, 2024.

Previous wording

We derive our revenues from tests based on units reported to customers—tests delivered with a result. All reported units are either accessioned in our laboratory or processed outside of our laboratory. As noted in the section titled “Overview” above, the number of tests that we process is a key metric as it tracks our overall volume growth. During the three months ended September 30, 2024, total reported units were approximately 750,100, comprised of approximately 735,900 tests reported in our laboratory. Comparatively, during the three months ended September 30, 2023, total reported units were approximately 590,000, comprised of approximately 575,000 tests reported in our laboratory. During the three months ended September 30, 2024 and 2023, total oncology units processed were approximately 137,100 and 88,800, respectively.

Current wording

We derive our revenues from tests based on units reported to customers—tests delivered with a result. All reported units are either accessioned in our laboratory or processed outside of our laboratory. As noted in the section titled “Overview” above, the number of tests that we process is a key metric as it tracks our overall volume growth. During the three months ended March 31, 2025, total reported units were approximately 804,800, comprised of approximately 791,400 tests reported in our laboratory. Comparatively, during the three months ended March 31, 2024, total reported units were approximately 679,400, comprising of approximately 663,500 tests reported in our laboratory. During the three months ended March 31, 2025 and 2024, total oncology units processed were approximately 167,700 and 114,800, respectively.

Previous wording

During the three months ended September 30, 2024, product revenues increased by $170.9 million, or 64.4%, compared to the three months ended September 30, 2023, primarily as a result of the continued revenue growth from increased test volumes, average selling price improvements, as well as cash receipts of $34.5 million collected during the current period related to tests delivered in prior periods that were fully collected.

Current wording

During the three months ended March 31, 2025, product revenues increased by $135.4 million, or 37.1%, compared to the three months ended March 31, 2024, primarily due to continued revenue growth from increased test volumes and average selling price improvements.

Previous wording

Licensing and other revenues decreased by $1.5 million, or 14.8%, during the nine months ended September 30, 2024 when compared to the nine months ended September 30, 2023. The decrease was primarily due to a decrease in revenue from our collaborative agreements.

Current wording

Licensing and other revenues decreased by $1.3 million, or 41.5%, during the three months ended March 31, 2025 when compared to the three months ended March 31, 2024. The decrease was primarily due to a decrease in revenue from our collaborative agreements.

Previous wording

During the three months ended September 30, 2024, cost of product revenues increased compared to the three months ended September 30, 2023 by approximately $20.7 million, or 14.1%, primarilydue to a $7.4 million increase in third-party fees, higher costs related to inventory consumption of $9.2 million driven by an increase in accessioned cases, and a $4.1 million increase in equipment and related depreciation expense, labor, overhead, shipping and other related costs driven by headcount growth and product support.

Current wording

During the three months ended March 31, 2025, cost of product revenues increased compared to the three months ended March 31, 2024 by approximately $25.8 million, or 16.2%, primarily due to higher costs related to inventory consumption of $11.6 million driven by an increase in accessioned cases, a $5.3 million increase in third-party fees, and a $8.9 million increase in labor, overhead, and other related costs driven by headcount growth and product support.

Previous wording

Cost of licensing and other revenues for the nine months ended September 30, 2024, when compared to the nine months ended September 30, 2023, decreased by $0.1 million, or 6.6%, primarily due to a net decrease in costs to support our collaborative agreements.

Current wording

Cost of licensing and other revenues for the three months ended March 31, 2025, increased by $0.1 million, or 47.2%, compared to the three months ended March 31, 2024, primarily due to a net increase in costs to support our collaborative agreements.

Previous wording

Research and development expenses during the three months ended September 30, 2024, increased by $19.7 million, or 25.5%, when compared to the three months ended September 30, 2023. The increase was attributable to a $11.6 million increase in salary and related compensation expenditures (including a $4.3 million increase in stock-based compensation expense), a $5.8 million increase in consulting expenses, and a $4.5 million increase in lab and clinical trial related expenses, which was offset by a $2.2 million net decrease in travel, office, facilities, and other expenses.

Current wording

Research and development expenses during the three months ended March 31, 2025, increased by $40.4 million, or 45.6%, when compared to the three months ended March 31, 2024. The increase was attributable to a $24.9 million increase in salary and related compensation expenditures, which includes a $6.0 million increase in stock-based compensation expense, a $7.5 million net increase in lab and clinical trial related expenses, and a $8.0 million increase primarily due to consulting, travel, office, facilities, and other expenses.

Previous wording

Selling, general and administrative expenses increased by $149.5 million, or 32.7%, during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. The increase was attributable to an increase of $82.2 million increase in salary and related compensation expenditures (including a $40.4 million increase in stock-based compensation expense), a $35.7 million increase in consulting and legal expenses, a $4.0 million increase in marketing expenses, a $5.6 million increase in travel expenses, a $4.7 million increase in office costs, a $14.5 million increase in vendor expenses, and a $2.8 million increase in facilities and other costs.

Current wording

Selling, general and administrative expenses increased by $72.6 million, or 37.4%, during the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The increase was primarily due to a $38.4 million increase in salary and related compensation expenditures, which includes a $6.0 million increase in stock-based compensation expense, a $8.1 million increase in consulting and legal expenses, a $4.6 million increase in office costs, a $4.3 million increase in marketing costs, a $4.2 million increase in vendor expenses, and a $13.0 million increase in travel, facilities, and other costs.

Previous wording

Interest expense decreased by $0.1 million in the three months ended September 30, 2024 compared to the same period in the prior year primarily as a result of the slight decrease in interest rate.

Current wording

Interest expense decreased by $2.1 million in the three months ended March 31, 2025, compared to the same period in the prior year, due to the redemption of the Convertible Notes in October 2024.

Previous wording

Interest and other income for the three months ended September 30, 2024 increased $6.2 million compared to the same period in the prior year, primarily due to greater cash and investment balances driving higher interest income.

Current wording

Interest and other income for the three months ended March 31, 2025, increased $3.2 million compared to the same period in the prior year, primarily due to the $3.2 million gain on revaluation of warrants and preferred shares.

Previous wording

We have incurred net losses each year since our inception. For the nine months ended September 30, 2024, we had a net loss of $136.7 million, and we expect to continue to incur losses in future periods as we continue to devote a substantial portion of our resources to our research and development and commercialization efforts for our existing and new products. As of September 30, 2024, we had an accumulated deficit of $2.5 billion. As of September 30, 2024, we had $892.8 million in cash and cash equivalents and restricted cash, $29.5 million in marketable securities, $80.4 million of outstanding balance under the Credit Line including accrued interest, and $287.5 million outstanding principal balance on the Convertible Notes. As of September 30, 2024, we had $20.0 million remaining and available on the Credit Line.

Current wording

We have incurred net losses each year since our inception. For the three months ended March 31, 2025, we had a net loss of $66.9 million, and we expect to continue to incur losses in future periods as we continue to devote a substantial portion of our resources to our research and development and commercialization efforts for our existing and new products. As of March 31, 2025, we had an accumulated deficit of $2.6 billion, $973.8 million in cash and cash equivalents and restricted cash, $17.8 million in marketable securities, and $80.3 million of outstanding balance under the Credit Line including accrued interest. As of March 31, 2025, we had $20.0 million remaining and available on the Credit Line.

Previous wording

In September 2023, we completed an underwritten equity offering and sold 4,550,000 shares of our common stock at a price of $55 per share to the public. Before offering expenses of approximately $0.4 million, we received proceeds of approximately $235.8 million net of the underwriting discount. Our contractual obligations and other commitments have been satisfied by the equity offering described above, our convertible note financing conducted in April 2020 described below, the Credit Line described below, and our product, licensing, and other sales. For our commitments, refer to the “Contractual Obligations and Other Commitments” section below.

Current wording

Our contractual obligations and other commitments have been satisfied by equity offerings, our convertible note financing conducted in April 2020 described below, the Credit Line described below, and our product, licensing, and other sales. For our commitments, refer to the “Contractual Obligations and Other Commitments” section below.

Previous wording

In September 2015, we entered into a Credit Line with UBS, or the Credit Line, providing for a $50.0 million revolving line of credit which could be drawn in increments at any time. The Credit Line was amended in July 2017 and bears interest at 30-day LIBOR plus 1.10%, and it is secured by a first priority lien and security interest in our money market and marketable securities held in our managed investment account with UBS. UBS has the right to demand full or partial payment of the Credit Line obligations and terminate it, in its discretion and without cause, at any time. The interest rate was subsequently changed to the 30-day Secured Overnight Financing Rate (“SOFR”) average, plus 1.21%. The SOFR rate is variable. The Credit Line was subsequently increased from $50.0 million to $150.0 million. In June 2023, the Credit Line decreased to $100.0 million. In October 2023, the interest rate for the Credit Line was subsequently changed to the 30-day SOFR average, plus 0.5%. As of September 30, 2024, the total principal amount outstanding with accrued interest was $80.4 million and $20.0 million is remaining as available under the Credit Line.

Current wording

In September 2015, we entered into a Credit Line with UBS, or the Credit Line, providing for a $50.0 million revolving line of credit which could be drawn in increments at any time. The Credit Line was amended in July 2017 and bears interest at 30-day LIBOR plus 1.10%, and it is secured by a first priority lien and security interest in our money market and marketable securities held in our managed investment account with UBS. UBS has the right to demand full or partial payment of the Credit Line obligations and terminate it, in its discretion and without cause, at any time. The interest rate was subsequently changed to the 30-day Secured Overnight Financing Rate, or SOFR, average, plus 1.21%. The SOFR rate is variable. The Credit Line was subsequently increased from $50.0 million to $150.0 million. In June 2023, the Credit Line decreased to $100.0 million. In October 2023, the interest rate for the Credit Line was changed to the 30-day SOFR average, plus 0.5%. As of March 31, 2025, the total principal amount outstanding with accrued interest was $80.3 million and $20.0 million is remaining as available under the Credit Line.

Previous wording

The Convertible Notes are senior, unsecured obligations of the Company and bear interest at a rate of 2.25% per year, payable in cash semi-annually in arrears in May and November of each year, beginning in November 2020. The Convertible Notes mature in May 2027, unless earlier converted, repurchased or redeemed in accordance with their terms. Upon conversion, the Convertible Notes are convertible into cash, shares of our common stock or a combination of cash and shares of our common stock, at our election. On July 19, 2024, we elected to exercise our optional redemption right to redeem all $287.5 million aggregate principal amount of our outstanding 2.25% Convertible Notes due 2027 and instructed Wilmington Trust, National Association, as trustee under the Indenture Agreement governing the Convertible Notes, to issue a redemption notice to registered holders of the Convertible Notes. The Redemption Date fixed for the redemption of the Convertible Notes was October 11, 2024. The redemption price for the Convertible Notes is equal to 100% of the principal amount of the Convertible Notes to be redeemed plus accrued and unpaid interest to, but excluding, the Redemption Date. We elected physical settlement with shares of our common stock as the settlement method to apply to all conversions of the Convertible Notes. On the Redemption Date, $287.4 million of Convertible Notes were converted for approximately 7.5 million shares of our common stock under the terms of the redemption notice. The remaining Convertible Notes not converted under the redemption notice were redeemed in exchange for cash at face value plus any accrued interest totaling $0.1 million.

Current wording

The Convertible Notes were senior, unsecured obligations of the Company and bore interest at a rate of 2.25% per year, payable in cash semi-annually in arrears in May and November of each year, beginning in November 2020. The Convertible Notes mature in May 2027, unless earlier converted, repurchased or redeemed in accordance with their terms. Upon conversion, the Convertible Notes were convertible into cash, shares of our common stock or a combination of cash and shares of our common stock, at our election. On July 19, 2024, we elected to exercise our optional redemption right to redeem all $287.5 million aggregate principal amount of our outstanding 2.25% Convertible Notes due 2027 and instructed Wilmington Trust, National Association, as trustee under the Indenture Agreement governing the Convertible Notes, to issue a redemption notice to registered holders of the Convertible Notes. The Redemption Date fixed for the redemption of the Convertible Notes was October 11, 2024. The redemption price for the Convertible Notes was equal to 100% of the principal amount of the Convertible Notes redeemed plus accrued and unpaid interest to, but excluding, the Redemption Date. We elected physical settlement with shares of our common stock as the settlement method to apply to all conversions of the Convertible Notes. On the Redemption Date, $287.4 million of Convertible Notes were converted for approximately 7.5 million shares of our common stock under the terms of the redemption notice. The remaining Convertible Notes not converted under the redemption notice were redeemed in exchange for cash at face value plus any accrued interest totaling $0.1 million.

Previous wording

Cash provided by operating activities during the nine months ended September 30, 2024 was $82.8 million. The net loss of $136.7 million includes $240.2 million in non-cash charges resulting from $23.2 million of depreciation and amortization, $202.5 million of stock-based compensation expense, $11.2 million of non-cash lease expense, $0.9 million for amortization of debt discount and issuance cost, $0.4 million for foreign exchange adjustment, and $2.7 million of non-cash interest expense offset by a $0.6 million decrease in amortization of premiums and accretion of purchase discounts on investment securities and a $0.1 million decrease in non-cash expense recovery. Operating assets had cash outflows of $22.9 million resulting from a $28.6 million increase in accounts receivable, an $8.0 million increase in inventory, offset by a $13.7 million decrease in prepaid expenses and other assets. Operating liabilities resulted in cash inflows of $2.2 million resulting from a $10.8 million increase in accounts payable and a $27.3 million increase in accrued compensation offset by a $12.5 million decrease in lease liabilities, a $22.5 million decrease in other accrued liabilities, and a $0.9 million decrease in deferred revenue.

Current wording

Cash provided by operating activities during the three months ended March 31, 2025 was $44.5 million. The net loss of $66.9 million includes $88.0 million in non-cash charges resulting from $9.2 million of depreciation and amortization, $77.8 million of stock-based compensation expense, $4.4 million of non-cash lease expense, and $0.1 million for foreign exchange adjustment, offset by a $0.3 million decrease in non-cash expense recovery and a $3.2 million change in fair value of warrants and preferred stock. Operating assets had cash outflows of $19.1 million resulting from a $9.4 million increase in prepaid expenses and other assets, a $4.1 million increase in accounts receivable, and a $5.6 million increase in inventory. Operating liabilities resulted in cash inflows of $42.5 million resulting from a $2.4 million increase in accounts payable, a $17.0 million increase in accrued compensation, a $26.9 million increase in other accrued liabilities and a $0.7 million increase in deferred revenue, offset by a $4.5 million decrease in lease liabilities.

Previous wording

Cash used in operating activities during the nine months ended September 30, 2023 was $189.4 million. The net loss of $356.8 million includes $176.5 million in non-cash charges resulting from $17.2 million of depreciation and amortization, $2.7 million in-process research and development, $1.9 million in amortization of premiums and accretion of purchase discounts on investment securities, $142.4 million of stock-based compensation expense, $11.0 million of non-cash lease expense, $1.0 million for amortization of debt discount and issuance cost, and $0.3 million for foreign exchange adjustment. Operating assets had cash outflows of $10.1 million resulting from a $10.8 million increase in accounts receivable, a $6.7 million increase in inventory, offset by a $7.4 million decrease in prepaid expenses and other assets. Operating liabilities resulted in cash inflows of $1.0 million resulting from a $15.2 million increase in accrued compensation and a $5.3 million increase in deferred revenue, offset by a $9.0 million decrease in accounts payable, a $2.1 million decrease in other accrued liabilities and a $8.4 million decrease in lease liabilities.

Current wording

Cash provided by operating activities during the three months ended March 31, 2024 was $27.0 million. The net loss of $67.6 million includes $75.3 million in non-cash charges resulting from $7.1 million of depreciation and amortization, $64.4 million of stock-based compensation expense, $3.6 million of non-cash lease expense, $0.3 million for amortization of debt discount and issuance cost, $0.4 million for foreign exchange adjustment, offset by $0.5 million premium amortization and discount accretion on investment securities. Operating assets had cash inflows of $1.7 million resulting from a $14.4 million decrease in prepaid expenses and other assets, offset by a $10.5 million increase in accounts receivable, a $2.2 million increase in inventory. Operating liabilities resulted in cash inflows of $17.6 million resulting from a $10.7 million increase in accounts payable, a $17.8 million increase in accrued compensation, and a $0.8 million increase in deferred revenue, offset by a $4.1 million decrease in lease liabilities and a $7.6 million decrease in other accrued liabilities.

Previous wording

Cash provided by investing activities for the nine months ended September 30, 2023 totaled $144.4 million, which was comprised of $173.5 million from proceeds of investments maturities, offset by $29.1 million in acquisitions of property and equipment.

Current wording

Cash provided by investing activities for the three months ended March 31, 2024 totaled $138.3 million, which was comprised of $169.1 million from proceeds of investments maturities, offset by $20.3 million in acquisitions of property and equipment and $10.5 million in asset acquisition.

Previous wording

Cash provided by financing activities for the nine months ended September 30, 2024, totaled $19.2 million which was comprised of $10.3 million from proceeds from the exercise of stock options and $8.9 million from the issuance of common stock under the employee stock purchase plan.

Current wording

Cash provided by financing activities for the three months ended March 31, 2025, totaled $0.5 million which was comprised of proceeds from the exercise of stock options.

Previous wording

We have entered into arrangements that contractually obligate us to make payments that will affect our liquidity and cash flows in future periods. Such arrangements include those related to our lease commitments, Credit Line, Convertible Notes, commercial supply agreements and other agreements.

Current wording

We have entered into arrangements that contractually obligate us to make payments that will affect our liquidity and cash flows in future periods. Such arrangements include those related to our lease commitments, Credit Line, commercial supply agreements and other agreements. Our purchase requirements are expected to be met through the normal course of business.

Previous wording

The short-term debt obligations consist of the $80.4 million principal amount drawn from the Credit Line with UBS and applicable interest. The Credit Line was amended in July 2017 and bears interest at 30-day LIBOR plus 1.10%, and it is secured by a first priority lien and security interest in our money market and marketable securities held in our managed investment account with UBS. The interest rate was subsequently changed to the 30-day SOFR average, plus 1.21%. The SOFR rate is variable. UBS has the right to demand full or partial payment of the Credit Line obligations and terminate it, in its discretion and without cause, at any time. In October 2023, the interest rate was subsequently changed to the 30-day SOFR average, plus 0.5%. Please refer to Note 10,Debt, for further details.

Current wording

The short-term debt obligations consist of the $80.3 million principal amount drawn from the Credit Line with UBS and applicable interest. The Credit Line was amended in July 2017 and bears interest at 30-day LIBOR plus 1.10%, and it is secured by a first priority lien and security interest in our money market and marketable securities held in our managed investment account with UBS. The interest rate was subsequently changed to the 30-day SOFR average, plus 1.21%. The SOFR rate is variable. UBS has the right to demand full or partial payment of the Credit Line obligations and terminate it, in its discretion and without cause, at any time. In October 2023, the interest rate was subsequently changed to the 30-day SOFR average, plus 0.5%. Please refer to Note 10,Debt, for further details.

Previous wording

Our lease commitments consist of $0.7 million of payments, which will be paid over the terms of the leases. The leases have not commenced under Accounting Standards Codification, or ASC, Topic 842, Leases (ASC 842), as of September 30, 2024. As a result, these leases are not reflected within the consolidated balance sheets.

Current wording

Our lease commitments consist of $3.4 million of payments, which will be paid over the terms of the leases. The leases have not commenced under Accounting Standards Codification, or ASC, Topic 842,Leases, as of March 31, 2025. As a result, these leases are not reflected within the consolidated balance sheets.