Cytek Biosciences, Inc.
For the period ended Mar 31, 2025. Filed May 8, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 8, 2025
CTKB$5.83+8.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-07.
0001628280-24-045834
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-08.
0001628280-25-023927
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 120 previous paragraphs and 127 current paragraphs.
75 unchanged; 29 reworded; 22 added; 16 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 13 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (22)
Current report
Total revenue for the three months ended March 31, 2025 was $41.5 million, an 8% decrease compared to revenue for the three months ended March 31, 2024 of $44.9 million.
Current report
Our net loss was $11.4 million and $6.2 million for the three months ended March 31, 2025 and 2024, respectively. The change for the three months ended March 31, 2025 compared to the three months ended March 31, 2024, resulted primarily from a decrease in revenues and gross profit and an increase in operating expenses.
Current report
We expect our expenses will increase substantially in connection with our ongoing activities, as we:
Current report
•attract, hire and retain qualified personnel;
Current report
•invest in processes, commercial infrastructure and supporting functions to scale our business and introduce new products and services;
Current report
•support our research and development efforts;
Current report
•continue to expand geographically;
Current report
•protect and defend our intellectual property; and
Current report
•make strategic investments in complementary businesses, services, products or technologies.
Current report
The strengthening of the U.S. dollar in early 2025 against the currencies of other countries where we do business had a negative impact on revenue in the first quarter of 2025 and may have a continuing negative impact in the near future.
Current report
The Trump administration has signaled changes to existing U.S. trade policies, including imposing and announcing plans for reciprocal tariffs on all U.S. trading partners including China, and renegotiating or potentially terminating existing bilateral and multi-lateral trade agreements. In response, certain foreign governments have announced or implemented retaliatory tariffs against U.S. goods and other non-tariff protectionist measures, such as procurement preferences or informal disincentives to engage with, purchase from or invest in U.S. entities, which may limit our ability to compete internationally and attract non-U.S. investment, employees, customers and suppliers. Although we cannot predict the ultimate extent to which the United States or other countries will impose quotas, duties, reciprocal tariffs, taxes, or other similar restrictions upon the import or export of our products, nor can we predict future trade policy or the terms of any renegotiated trade agreements and their impact on our business, the Trump administration’s imposition of tariffs as well as threatened and actual retaliatory tariffs against U.S. goods may have a negative impact on our revenue and costs in the future.
Current report
In addition, the new license and export controls announced by the U.S. government in January 2025 that impact exports of certain products and technology, including high-parameter and spectral flow cytometers and cell sorters and certain mass spectrometry equipment to certain countries, including China, may have a negative impact on our sales, manufacturing and research and development activities.
Current report
Finally, changes in the U.S. National Institutes of Health (“NIH”) policy with respect to grants for academic research, specifically, the reduction in indirect cost reimbursement, may impact our revenue from academic and government customers in the near term.
Current report
Total revenue, net decreased by $3.4 million to $41.5 million, or 8%, for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024.
Current report
Product revenue decreased by $6.0 million to $28.1 million, or 18%, for the three months ended March 31, 2025, as compared to the three months ended March 31, 2024 due to lower revenue in EMEA and the United States offset partially by growth in the APAC market, particularly in China.
Current report
Service revenue increased $2.6 million to $13.3 million, or 24% for the three months ended March 31, 2025, as compared to the three months ended March 31, 2024. The increase was primarily due to continued growth of the installed base with the related increase in service contracts and maintenance activity.
Current report
Total cost of sales decreased by $0.5 million, or 3%, for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024. The decrease in cost of sales was driven primarily by decreases in product revenue, offset by higher cost for service parts used in the field and higher overhead costs in three months ended March 31, 2025.
Current report
Research and development expenses were $9.7 million for the three months ended March 31, 2025 as compared to $9.8 million for the three months ended March 31, 2024.
Current report
Sales and marketing expenses were $12.5 million for the three months ended March 31, 2025 as compared to $12.5 million for the three months ended March 31, 2024.
Current report
General and administrative expenses were $12.9 million for the three months ended March 31, 2025 as compared to $11.4 million for the three months ended March 31, 2024. The increase of $1.5 million in general and administrative expenses was primarilydue to an increase in outside service expenses and higher compensation related to increased headcount.
Current report
Provision for income taxes was $0.1 millionfor the three months ended March 31, 2025 as compared to a benefit from income taxes of $2.8 million for the three months ended March 31, 2024. The net increase of $2.96 million for the three months ended March 31, 2025 was primarily due to a lower effective tax rate as a result of a projected net loss for 2025 which caused permanently nondeductible items to decrease the effective tax rate as opposed to increasing the effective tax rate for the same quarter in 2024.
Current report
Net cash used inoperating activities for the three months ended March 31, 2025 was $0.1 million, which included a net loss of $11.4 million, a decrease in accrued expenses and other liabilities of $2.1 million, and loss on investments, accretion and amortization, net of $1.5 million. Additionally, there was an increase of $1.5 million in inventories and a decrease of operating lease liabilities of $1.0 million. Cash used in operating activities during the period was partially offset bythe non-cash provision for stock-based compensation expense, depreciation and amortization, amortization of right-of-use assets, and excess and obsolete inventory of $6.6 million, $1.9 million, $1.0 million, and $0.3 million, respectively. Additionally, trade accounts receivable decreased by $6.4 million due to seasonality, with our first quarter typically being lower than our fourth quarter.
Removed paragraphs (16)
Previous report
Total revenue for the three and nine months ended September 30, 2024 was $51.5 million and $143.0 million, respectively, representing a 7% increase and a 6% increase, respectively, compared to total revenue for the three and nine months ended September 30, 2023 of $48.0 million and $134.8 million, respectively. Total revenue for the three months ended September 30, 2024 increased compared to total revenue for the three months ended September 30, 2023 primarily due to higher product revenue resulting from higher product sales in Europe, the Middle East and Africa (“EMEA”) and Asia and Pacific countries (“APAC”), particularly in the biotechnology and pharmaceutical market sector. The increase in total revenue for the nine months ended September 30, 2024 compared to total revenue for the nine months ended September 30, 2023 was due to higher service revenue as a result of a larger installed base of instruments generating service contracts and other service revenue, partially offset by lower product revenue in the period.
Previous report
Our net income (loss) was $0.9 million and$(15.7) million for the three and nine months ended September 30, 2024, respectively, and our net loss was$6.5 million and$17.7 million for the three and nine months ended September 30, 2023, respectively. The increase in net income (loss) for the three months ended September 30, 2024 compared to the three months ended September 30, 2023 resulted primarily from a lower loss from operations compared to the prior period, a foreign exchange gain compared to a loss in the prior period and a tax benefit compared to a tax expense in the prior period. The decrease in net loss for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 was primarily due to a lower loss from operations and lower interest expense, offset by lower interest income and lower net other income due to foreign exchange losses.
Previous report
We expect our expenses to be relatively flat in the future but will continue to focus on developing new products and growing revenue.
Previous report
*In the third quarter of 2024, management identified a misclassification in the Company's historical interim financial statements for the second quarter of 2024 relating to $14.2 million in the disaggregation of revenue by customer mix for the six months ended June 30, 2024. This misclassification impacts only the previously issued historical interim financial statements for the second quarter of 2024. There is no net impact on the total revenue for the three and six months ended June 30, 2024. The Company corrected the error in the third quarter of 2024 and concluded the error was not material to the previously issued interim financial statements.
Previous report
Total revenue increased by$3.5 million to $51.5 million, or 7%, and by$8.2 million, or 6%, forthe three and nine months ended September 30, 2024, as compared to the three and nine months ended September 30, 2023, respectively. The increase in total revenue for the three months ended September 30, 2024 compared to total revenue for the three months ended September 30, 2023 was due to higher service and product revenue. The increase in total revenue for thenine months ended September 30, 2024 compared to thenine months ended September 30, 2023 was due to higher service revenue and an additional two months of revenue from the FCI Acquisition, which closed on February 28, 2023.
Previous report
Product revenue increased by$1.1 million to $39.5 million, or 3%, and decreased by$1.8 million to $108.2 million, or 2%, for the three and nine months ended September 30, 2024, as compared to the three and nine months ended September 30, 2023, respectively. The increase for the three month period was primarily due to higher instrument sales in the EMEA and APAC regions, offset by lower instrument sales in the United States. The decrease for thenine months ended September 30, 2024 compared to the nine months ended September 30, 2023 was primarily related to lower instrument sales in the United States, partially offset by an increase in instrument sales in the EMEA and APAC regions.
Previous report
Service revenue increased by$2.4 million to $12.0 million, or 25%, and by$10.0 million to $34.7 million, or 41%, for the three and nine months ended September 30, 2024, as compared to the three and nine months ended September 30, 2023, respectively. The increase was primarily due to growth in the installed base of instruments as compared to prior year periods which drove growth in both service contract revenue and other service revenue.
Previous report
Total cost of sales increased by$1.7 million, or 8%, and by$7.1 million, or 12%, for the three and nine months ended September 30, 2024, as compared to the three and nine months ended September 30, 2023, respectively. The increase in product cost of sales for the three months ended September 30, 2024 was primarily driven by the increase in product revenue, higher material cost associated with the amortization of the standard cost revaluation in January 2024 and higher scrap expense and excess and obsolete inventory expense, offset by lower manufacturing overhead expense. The increase in product cost of sales for thenine months ended September 30, 2024 was primarily due to higher inventory adjustments of a one-time nature in the three months ended March 31, 2024 arising from the integration of Luminex inventories, higher material costs due to the factors described above and higher manufacturing overhead. Service cost of sales for the three and nine months ended September 30, 2024 increased compared to the prior year period due to higher service headcount, travel, and contractor expense. Service cost of sales increased at a lower rate than service revenue in the three and nine months ended September 30, 2024 due to higher service labor productivity, lower material costs relative to revenue and improved absorption of overhead costs.
Previous report
Research and development expenses were $9.9 million and $29.7 million for the three and nine months ended September 30, 2024, respectively, as compared to $11.2 million and $33.3 million for the three and nine months ended September 30, 2023, respectively. The decrease in research and development expenses for both the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023 was primarily due to headcount reductions and to a lesser extent a reduction in engineering expenses.
Previous report
Our research and development expense may increase in absolute dollars as we continue to develop new products and enhance existing instruments and technologies.
Previous report
Sales and marketing expenses were $12.4 million and $37.2 million for the three and nine months ended September 30, 2024, respectively, as compared to $12.1 million and $37.6 million for the three and nine months ended September 30, 2023, respectively. The decrease in sales and marketing expenses for thenine months ended September 30, 2024 compared to thenine months ended September 30, 2023 was primarily due to a decrease in headcount and personnel-related expenses.
Previous report
Our sales and marketing expenses may increase in absolute dollars as we expand our sales support infrastructure and invest in our brand and product awareness to further penetrate the United States and the international markets.
Previous report
General and administrative expenses were $10.9 million and $34.0 million for the three and nine months ended September 30, 2024, respectively, as compared to $10.4 million and $33.2 million for the three and nine months ended September 30, 2023, respectively. The increase of $0.6 million in general and administrative expenses in the three months ended September 30, 2024 as compared to the three months ended September 30, 2023 was primarily due to an increase in stock-based compensation expense, partially offset by lower outside professional service expense. The increase of $0.8 million in general and administration expenses in thenine months ended September 30, 2024 as compared to thenine months ended September 30, 2023 included increases in stock-based compensation expense, and outside professional services expense, partially offset by a decrease in audit, insurance expense and sales and use tax.
Previous report
Benefit from income taxes was $0.8 million and $0.4 million for the three and nine months ended September 30, 2024, respectively, as compared to a provision for income taxes of $2.3 million and benefit from income taxes of $2.2 million for the three and nine months ended September 30, 2023, respectively. The net change of $3.1 million for the three months ended September 30, 2024 compared to the three months ended September 30, 2023 was primarily due to the reversal in the three months ended September 30, 2023 of the tax benefit from the six months ended September 30, 2023 due to a lower effective tax rate for the nine months ended September 30, 2023, and an adjustment to tax expense for the three months ended September 30, 2024 to account for the settlement price of restricted stock units settled in the quarter being lower than the grant price. The decrease in tax benefit of $1.8 million for the nine months ended September 30, 2024 was primarily due to lower projected loss and lower projected R&D tax credits in 2024 which caused a reduction in the effective tax rate. Neither of these tax expense and benefit changes had a cash impact on the company.
Previous report
Net cash used in operating activities for the nine months ended September 30, 2023 was $4.2 million including net loss of $17.7 million. We also incurred non-cash provision for stock-based compensation expense, gain on investments, depreciation and amortization, amortization of right-of-use assets, and interest expenses for accretion of the legal settlement liabilities, and excess and obsolete inventory of $16.4 million, $5.3 million, $4.4 million, $2.4 million, $1.3 million, and $0.8 million, respectively. Usage of cash which included a decrease in lease liability of $2.2 million, an increase in inventories of $2.0 million and an increase in the legal settlement liability of $0.4 million. Additionally, there was an increase of trade accounts receivable of $7.6 million, an increase in prepaid expenses and other assets of $2.3 million, an increase in accrued expenses and other liabilities of $0.6 million, an increase in deferred revenue of $7.2 million and an increase of trade accounts payables of $0.01 million.
Previous report
Net cash used in financing activities during the nine months ended September 30, 2023 was $8.1 million driven by the payments for the repurchase of shares of $9.4 million, repayment of loan of $0.4 million, and payment for taxes related to net share settlement of equity awards of $0.3 million. This was offset by the issuance of our common stock under our equity incentive plans of $1.1 million and proceeds from our Employee Stock Purchase Plan of $1.0 million.
Reworded paragraphs (29)
Previous wording
Our core FSP systems, the Cytek Aurora and Northern Lights flow cytometers, deliver high-resolution, high-content and high-sensitivity cell analysis and addresses the inherent limitations of other technologies by providing a higher level of multiplexing with exquisite sensitivity, more flexibility and increased efficiency, all at a lower cost for performance. Additionally, our Cytek Aurora cell sorter (“Aurora CS”) leverages our FSP technology to further broaden our potential applications across cell analysis. Each system is supported by our highly intuitive, proprietary embedded SpectroFlo software, our reagents, and our service offerings to provide a comprehensive, end-to-end platform of solutions for our customers. Since our first U.S. commercial launch in mid-2017, we have sold and deployed our instruments to customers around the world, including pharmaceutical companies, biopharma companies, academic research centers, and clinical research organizations (“CROs”).
Current wording
Our FSP cell analyzers, the Cytek Aurora and Northern Lights systems, deliver high-resolution, high-content and high-sensitivity cell analysis and addresses the inherent limitations of other technologies by providing a higher level of multiplexing with exquisite sensitivity, more flexibility and increased efficiency, all at a lower cost for performance. Additionally, our Cytek Aurora cell sorter (“Aurora CS system”) leverages our FSP technology to further broaden our potential applications across cell analysis. Each system is supported by our highly intuitive, proprietary embedded SpectroFlo software, our reagents, and our service offerings to provide a comprehensive, end-to-end platform of solutions for our customers. Since our first U.S. commercial launch in mid-2017 through December 31, 2024, we have sold and deployed our instruments to customers around the world, including pharmaceutical companies, biopharma companies, academic research centers, and clinical research organizations (“CROs”).
Previous wording
On February 28, 2023, we completed the acquisition of certain assets (the “FCI Acquisition”) relating to the flow cytometry and imaging business of Luminex Corporation (“Luminex”), including relating to the business of manufacturing, marketing, selling, servicing and maintaining Amnis- and Guava-branded instruments, and flow cytometry reagent products and services (the “FCI Business”). The acquired FCI Business includes conventional flow and image-based flow cytometry instrumentation and related products and services (the “FCI Products”), which provide insights into all facets of cellular phenotypes and morphology. The acquisition supports our plan to develop new products and capabilities with flow cytometry and imaging technology, expand our reach and offerings into customer sectors previously underserved, and increase the efficiency of our operations.
Current wording
On February 28, 2023, we completed the acquisition of certain assets (the “FCI Acquisition”) relating to the flow cytometry and imaging business of Luminex Corporation (“Luminex”), including relating to the business of manufacturing, marketing, selling, servicing and maintaining Amnis- and Guava-branded instruments, and flow cytometry reagent products and services (the “FCI Business”). The acquired FCI Business includes conventional flow and image-based flow cytometry instrumentation and related products and services (the “FCI Products”), which provide insights into all facets of cellular phenotypes and morphology. The acquisition supports our plan to develop new products and capabilities with flow cytometry and imaging technology, expand our reach and offerings into customer segments previously underserved, and increase the efficiency of our operations.
Previous wording
We manufacture our instruments in our facilities in Fremont, California; Wuxi, China; and Seattle, Washington. We have designed our operating model to be capital efficient and to scale efficiently as our product volumes grow.
Current wording
We manufacture our instruments in our facilities in Fremont, California; Wuxi, China; Seattle, Washington; and Singapore. We have designed our operating model to be capital efficient and to scale efficiently as our product volumes grow.
Previous wording
To date, we have adopted a direct sales model in North America, Europe, China, and several other countries in the Asia-Pacific region, and sell our products through third-party distributors in certain countries in Europe, Latin America, the Middle East, Africa and the Asia-Pacific region. Revenue from direct sales represented 77% and 76% of total revenue for the three and nine months ended September 30, 2024, respectively, and 77% and 74% for the three and nine months ended September 30, 2023, respectively. Revenue from distributors represented 23% and 24% of total revenue for the three and nine months ended September 30, 2024 and 23% and 26% for the three and nine months ended September 30, 2023.
Current wording
To date, we have adopted a direct sales model in North America, Europe, China, and several other countries in the Asia-Pacific region, and sell our products through third-party distributors in certain countries in Europe, Latin America, the Middle East, Africa and the Asia-Pacific region. Revenue from direct sales represented 72% and 77% of total revenue for the three months ended March 31, 2025 and 2024, respectively, and revenue from distributors represented 28% and 23% of total revenue for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
We focus a substantial portion of our resources on developing new products and solutions to meet our customers’ needs. Our research and development efforts focus on developing new and complementary instruments, reagents and reagent kits, and continued operating software development. We incurred research and development expensesof $9.9 million and $29.7 million for the three and nine months ended September 30, 2024, respectively, and $11.2 million and $33.3 million three and nine months ended September 30, 2023, respectively. While research and development expense was slightly lower in thethree and nine months ended September 30, 2024 compared to thethree and nine months ended September 30, 2023, we intend to continue to make significant investments in research and development in the future.
Current wording
We focus a substantial portion of our resources on developing new products and solutions to meet our customers’ needs. Our research and development efforts focus on developing new and complementary instruments, reagents and reagent kits, and continued operating software development. We incurred research and development expenses of $9.7 million and $9.8 million for the three months ended March 31, 2025 and 2024, respectively. We intend to continue to make significant investments in research and development in the future.
Previous wording
We expect tocontinue to invest in our commercial infrastructure through hiring additional employees with strong scientific and technical backgrounds to support growth in our instrument sales as well as our planned expansion of reagents offerings and panel design capabilities. We also plan to continue to invest in sales, marketing and business development across the globe to drive commercialization of our products. We incurred sales and marketing expenses of$12.4 million and $37.2 millionfor the three and nine months ended September 30, 2024, respectively, and $12.1 million and $37.6 million for the three and nine months ended September 30, 2023, respectively.
Current wording
We expect to continue to invest in our commercial infrastructure through hiring additional employees with strong scientific and technical backgrounds to support growth in our instrument sales as well as our planned expansion of reagents offerings and panel design capabilities. We also plan to continue to invest in sales, marketing and business development across the globe to drive commercialization of our products. We incurred sales and marketing expenses of $12.5 million and $12.5 million for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
Our revenue is primarily derived from sales of our instruments and services. Although we expect sales of our instruments to continue to represent the largest percentage of our revenue in the future, we expect service revenues to increase as a percentage of our total revenue as we grow our installed base. We expect a higher gross margin on our instruments as we increase the scale of our manufacturing operations as revenue grows and improve manufacturing efficiency. Our sales in certain regions outside of the United States, are realized through third-party distribution partners that typically receive discounted prices, thus resulting in lower gross margins than those recognized by our direct sales organization. Furthermore, our gross margins and instrument selling prices may fluctuate in the future as we continue to grow our volume of third-party distribution partners in geographies outside of the United States, introduce new products and reduce our production costs and as a result of variability in the timing of new product introductions.
Current wording
Our revenue is primarily derived from sales of our instruments and services with our instruments recognizing higher revenue and gross profit than our services. Although we expect sales of our instruments to continue to represent the largest percentage of our revenue in the future, we expect service revenue to increase as a percentage of our total revenue and our gross margins to experience a corresponding improvement as we grow our installed base and increase our focus on leveraging our fixed manufacturing and service overhead costs. Our sales in certain regions, particularly outside of the United States, are largely realized through third-party distribution partners that typically receive discounted prices, thus resulting in lower gross margins than those recognized by our direct sales organization. Furthermore, our instrument selling prices and gross margins may fluctuate in the future due to the impact of competing products entering the market and fluctuating foreign exchange rates and as we continue to introduce new products and reduce our production costs.
Previous wording
In the near term, we expect the continued optimization of our manufacturing processes related to our instruments and the expansion of product manufacturing distribution facilities to have the greatest impact on our gross margin. In addition to the impact of competing products entering the market, the future gross margin profiles of our instruments, services and reagents will depend on the outcome of any royalties we are required to pay and the royalty rates and products to which such royalties apply.
Current wording
In the near term, we expect the continued leveraging of fixed manufacturing and service overhead costs, optimization of our manufacturing processes, and material cost fluctuations to have the greatest impact on our gross margin.
Previous wording
We focus our research and development efforts on the greatest value-additive products to meet the growing and unmet needs of the research and clinical markets. We work closely with researchers, clinicians and scientists to optimize and implement new panels and applications to meet their specific needs. We also gain valuable insight on potential new products, new applications and enhancements to existing products, as well as biomarker combinations that would be beneficial in different fields, through collaborations with our customers, academic laboratories, key opinion leaders and industry partners. We plan to continue to invest in new product development and enhancements to support our expansion into new markets.
Current wording
We focus our research and development efforts on the greatest value-additive products to meet the growing and unmet needs of the research and clinical markets. We work closely with researchers, clinicians and scientists to optimize and implement new panels and applications to meet their specific needs. We also gain valuable insight on potential new products, new applications and enhancements to existing products, as well as biomarker combinations that would be beneficial in different fields, through collaborations with our customers, academic laboratories, KOLs and industry partners. We plan to continue to invest in new product development and enhancements to support our expansion into new markets.
Previous wording
Recent inflation trends may adversely affect our business and corresponding financial position and cash flows. Inflationary factors, such as increases in the cost of materials and supplies, interest rates and overhead costs may adversely affect our operating results. Many economists suggest that we should expect a higher recession risk to continue in the near term, which could result in further economic uncertainty and volatility in the capital markets in the near term, and could negatively affect our operations. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, we may experience increases in the near future (especially if inflation rates continue to rise) on our operating costs, including our labor costs and research and development costs, due to supply chain constraints, consequences associated with future public health crises, the ongoing conflict between Russia and Ukraine, conflict in the Middle East orliquidity concerns at, and failure of, banks and other financial institutions.
Current wording
Recent inflation trends may adversely affect our business and corresponding financial position and cash flows. Inflationary factors, such as increases in the cost of materials and supplies, labor and benefit costs and overhead costs may adversely affect our operating results. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, we may experience increases in the near future (especially if the rate of inflation increases) on our operating costs, including our labor costs and research and development costs, due to supply chain constraints, consequences associated with future public health crises, the ongoing conflict between Russia and Ukraine, conflict in the Middle East or liquidity concerns at, and failure of, banks and other financial institutions.
Previous wording
Many of our pharmaceutical and biotech customers based in the United States have been impacted by macro-economic uncertainties related to the weakening economy, liquidity concerns in the broader financial services industry, such as those caused by recent banking failures, disruptions to and volatility in the credit and equity markets, and rising interest rates. We believe these factors contributed to longer sales cycles, which adversely impacted our operating results for the nine months ended September 30, 2024, and may adversely affect our operating results in the future.
Current wording
Certain of our pharmaceutical and biotech customers based in the United States have been impacted by the difficult fundraising environment for small companies and generally high interest rates. We believe these factors contributed to longer sales cycles, which adversely impacted our operating results for the three months ended March 31, 2025 and may adversely affect our operating results in the future.
Previous wording
We expect our revenue to increase as we broaden our customer base, increase our installed base, and expand awareness of our products with new and existing customers.
Current wording
We expect our revenue to increase in absolute dollars as we expand our sales organization and sales territories, broaden our customer base, and expand awareness of our products with new and existing customers. Our revenue was $41.5 million and $44.9 million for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
Product. Cost of sales associated with our products primarily consists of manufacturing-related costs incurred in the production process, inventory write-downs, warranty costs, third party royalty costs, personnel and related costs, costs of component materials, overhead, packaging and delivery and depreciation expense.
Current wording
Product. Cost of sales associated with our products primarily consist of manufacturing-related costs incurred in the production process, inventory write-downs, warranty costs, third party royalty costs, personnel and related costs, costs of component materials, overhead, packaging and delivery and depreciation expense.
Previous wording
Our operating expenses are primarily comprised of research and development, sales and marketing, general and administrative expenses, depreciation and amortization, and related overhead.
Current wording
Our operating expenses are primarily comprised of research and development, sales and marketing, and general and administrative expenses, depreciation and amortization, and related overhead.
Previous wording
Our (benefit from) provision for income taxes consists primarily of provision for federal taxes and local taxes in the United States as well as foreign taxes. As we plan to expand the scale and scope of our international business activities, any changes in the United States and foreign taxation of such activities may increase our overall provision for income taxes in the future.
Current wording
Our provision for (benefit from) income taxes consists primarily of provision for federal taxes and local taxes in the United States as well as foreign taxes. As we plan to expand the scale and scope of our international business activities, any changes in the United States and foreign taxation of such activities may increase our overall provision for income taxes in the future.
Previous wording
Comparison of the three and nine months ended September 30, 2024 and 2023
Current wording
Comparison of the three months ended March 31, 2025 and 2024
Previous wording
Total gross margin was 56% and 57% of total revenue for the three months ended September 30, 2024 and 2023, respectively, and 54% and 57% for thenine months ended September 30, 2024 and 2023, respectively. Total gross margin decreased for the three months ended September 30, 2024 as a result of lower product gross margin due to higher product cost of sales for the reasons described above. This was partially offset by higher service gross margin driven by higher service revenue, higher service labor productivity and improved absorption of overhead costs. Gross margin decreased for thenine months ended September 30, 2024 due to lower product gross margin as a result of higher product cost of sales for the reasons described above. Gross margin depends on many factors, including market conditions that might affect our pricing, services, product mix changes between instrument configurations, excess and obsolete inventories, our cost structure for manufacturing operations relative to volume, freight costs and product support.
Current wording
Total gross profit margin was 49% and 51% of total revenue for the three months ended March 31, 2025 and 2024, respectively. Gross profit margin declined due to higher cost of sales driven by the factors described above. Gross profit margin depends on many factors, including market conditions that might affect our pricing; services; product mix changes between instrument configurations; excess and obsolete inventories; our cost structure for manufacturing operations relative to volume, freight costs and product support.
Previous wording
Product revenue increased by 3% for the three months ended September 30, 2024 and decreased by 2% for thenine months ended September 30, 2024, as compared to the three and nine months ended September 30, 2023, respectively. Product cost of sales for the three and nine months ended September 30, 2024 increased by 8% and 10%, respectively, as compared to the three andnine months ended September 30, 2023. Product gross profit for the three and nine months ended September 30, 2024 decreased 1% and 10%, respectively, as compared to the three and nine months ended September 30, 2023. The lower product gross margins in the three months ended September 30, 2024 compared to the three months ended September 30, 2023 was driven primarily by higher product cost of sales and higher overhead costs. The lower product gross margins in thenine months ended September 30, 2024 compared to thenine month ended September 30, 2023 was a result of higher material costs related to unfavorable inventory adjustments in the three months ended March 31, 2024 arising from the integration of Luminex inventories and higher overhead costs.
Current wording
Product revenue for the three months ended March 31, 2025 decreased by 18% as compared to the three months ended March 31, 2024. Product cost of sales for the three months ended March 31, 2025 decreased by 7% as compared to the same period in 2024. Product gross profit for the three months ended March 31, 2025 decreased 28% as compared to the three months ended March 31, 2024. The lower product gross profit margins in the three months ended March 31, 2025 compared to the three months ended March 31, 2024 were driven primarily by lower product revenue partially offset by lower material costs, and higher manufacturing material and overhead costs.
Previous wording
Service revenue for the three and nine months ended September 30, 2024 increased 25% and 41%, respectively, as compared to the three and nine months ended September 30, 2023. Service cost of sales for the three and nine months ended September 30, 2024 increased by 8% and 20%, respectively, as compared to the three and nine months ended September 30, 2023. Service gross profit for the three and nine months ended September 30, 2024 increased 41% and 62%, respectively, as compared to the three and nine months ended September 30, 2023. The higher service gross margins in the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023 were mainly driven by operating efficiencies from higher service labor productivity and improved absorption of overhead costs by leveraging these costs over greater revenues.
Current wording
Service revenue for the three months ended March 31, 2025 increased 24% as compared to the three months ended March 31, 2024. Service cost of sales for the three months ended March 31, 2025 increased by 13% as compared to the same period in 2024. Service gross profit for the three months ended March 31, 2025 increased 34% as compared to the three months ended March 31, 2024. The higher service gross margins in the three months ended March 31, 2025 compared to the three months ended March 31, 2024 were mainly driven by operating efficiencies gained from leveraging operating costs over greater revenues.
Previous wording
Interest expense was $0.1 million and $0.7 million for the three and nine months ended September 30, 2024, respectively, as compared to $0.6 million and $1.7 million, for the three and nine months ended September 30, 2023, respectively. The decrease in interest expense was mainly due to an adjustment to the accretion of the present value of the financial obligation related to the settlement agreement with Becton, Dickinson and Company (“BD”). See Note 11 to our unaudited interim consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.
Current wording
Interest expense was $0.3 million for the three months ended March 31, 2025 as compared to $0.4 million for the three months ended March 31, 2024. The decrease was mainly due to the adjustment to the settlement liability related to the settlement agreement with Becton, Dickinson and Company (“BD”). See Note 11 to our unaudited interim consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.
Previous wording
Interest income was $1.4 million and $4.2 million for the three and nine months ended September 30, 2024, respectively, as compared to $1.6 million and $5.0 million for the three and nine months ended September 30, 2023, respectively. The decrease in interest income for the nine months ended September 30, 2024 compared to interest income for the nine months ended September 30, 2023 was the result of lower average balance of cash and cash equivalents due to the funding of the FCI Acquisition on February 28, 2023 and the investment of cash in marketable securities.
Current wording
Interest income was $0.5 million for the three months ended March 31, 2025 as compared to $1.4 million for the three months ended March 31, 2024. The decrease in interest income was the result of lower average balance of cash and cash equivalents and short-term investments as compared to the three months ended March 31, 2024 due to the transfer of funds from cash accounts to marketable securities accounts, the income from which is classified as investment income, included in Other income, net, rather than interest income, and a lower interest rate environment.
Previous wording
Other income, net was $3.1 million and $4.0 million for the three and nine months ended September 30, 2024, respectively, as compared to other income, net of $1.2 million and $4.6 million for the three and nine months ended September 30, 2023, respectively. The increase in other income, net for the three months ended September 30, 2024 was primarily due to net foreign exchange gains of $1.2 million compared to a foreign exchange loss of $0.6 million in the prior year period. The decline in other income for the nine months ended September 30, 2024 was primarily driven by an increase in realized and unrealized foreign exchange losses.
Current wording
Other income, net, was $3.5 million for the three months ended March 31, 2025, as compared to other income, net of $0.8 million for the three months ended March 31, 2024. The increase in other income was primarily driven by an increase in realized and unrealized foreign exchange gains of $1.3 million in the three months ended March 31, 2025, compared to foreign exchange losses of $1.1 million in the three months ended March 31, 2024, and an increase in investment income of $0.3 million in the current quarter.
Previous wording
To date, our primary sources of capital have been through sales of our securities and revenue from the sale of our products and services. As of September 30, 2024 and December 31, 2023, we had approximately$277.8 million and $262.7 million, respectively, in cash and cash equivalents, restricted cash, and short term investments, which were primarily held in U.S. short-term bank deposit accounts, money market funds, U.S. Treasury notes, Federal agency security notes, and short term commercial paper.
Current wording
To date, our primary sources of capital have been through sales of our securities and revenue from the sale of our products and services. As of March 31, 2025 and December 31, 2024, we had approximately $265.6 million and $277.9 million, respectively, in cash and cash equivalents and short term investments, which were primarily held in U.S. short-term bank deposit accounts, money market funds, U.S. Treasury notes, Federal agency security notes, and short term commercial paper.
Previous wording
In addition, we lease certain office facilities under operating lease arrangements that expire on various dates through fiscal year 2029. Under the terms of the leases, we are responsible for certain expenses related to operations, maintenance, repairs and management fees. Future minimum lease payments under non-cancelable operating leases totaled$11.8 million as of September 30, 2024.
Current wording
In addition, we lease certain office facilities under operating lease arrangements that expire on various dates through fiscal year 2029. Under the terms of the leases, we are responsible for certain expenses related to operations, maintenance, repairs and management fees. Future minimum lease payments under non-cancelable operating leases totaled $11.6 million as of March 31, 2025.
Previous wording
Net cash provided by operating activities for the nine months ended September 30, 2024 was $23.4 million due to the non-cash provision for stock-based compensation expense, depreciation and amortization, amortization of right-of-use assets, and excess and obsolete inventory of $19.8 million, $5.4 million, $2.4 million, and $1.4 million, respectively, partially offset by a gain on investments, accretion and amortization, net of $3.6 million. Additionally, there was a decrease of inventories of $12.8 million and a decrease of trade accounts receivable of $3.9 million. These were partially offset by the usage of cash which included the net loss of $15.7 million, a decrease in accrued expenses and other liabilities of $3.8 million, and an increase prepaid expenses and other assets of $2.1 million.
Current wording
Net cash provided byoperating activities for the three months ended March 31, 2024 was $4.0 million due to the non-cash provision for stock-based compensation expense, depreciation and amortization, excess and obsolete inventory and amortization of right-of-use assets of $5.6 million, $1.7 million, $0.9 million, and $0.8 million, respectively; partially offset by a gain on investments, accretion and amortization, net of $1.2 million. Additionally, there was a decrease of inventories of $4.8 million and a decrease of trade accounts receivable of $4.2 million due to seasonality with our first quarter typically being lower than our fourth quarter. These were partially offset by cash used in operating activities during the period, which included a net loss of $6.2 million and an increase in accrued expenses and other liabilities of $4.6 million.
Previous wording
Net cash used in investing activities during the nine months ended September 30, 2023 was $123.0 million driven by purchases of marketable securities of $152.6 million, proceeds from maturities of marketable securities of $78.0 million, purchase of business of $44.9 million, purchase of property and equipment of $3.1 million, and payment of additional investments in Cytek Japan of $0.2 million.
Current wording
Net cash provided by investing activities during the three months ended March 31, 2025 was $9.5 million driven by proceeds from maturities of marketable securities of $70.4 million, partially offset by purchases of marketable securities of $60.2 million and purchases of fixed assets and intangibles of approximately $0.9 million.
Previous wording
Net cash used in investing activities during the nine months ended September 30, 2024 was $19.5 million driven by purchases of marketable securities of $166.8 million and the purchase of property and equipment of approximately $2.6 million. This was partially offset by the proceeds from maturities of marketable securities of $150.0 million.
Current wording
Net cash used in investing activities during the three months ended March 31, 2024 was $5.8 million driven by purchases of marketable securities of $77.1 million, partially offset by the proceeds from maturities of marketable securities of $72.0 million and purchase of fixed assets and intangibles of approximately $0.6 million.
Previous wording
Net cash used in financing activities during the nine months ended September 30, 2024 was $12.2 million driven by the payments for the repurchase of shares of $14.6 million. This was partially offset by the proceeds from a line of credit of $1.4 million, proceeds from our Employee Stock Purchase Plan of $1.0 million, and the proceeds from the issuance of common stock under our equity incentive plans of $0.9 million.
Current wording
Net cash used in financing activities during the three months ended March 31, 2025 was $11.5 million driven by the payments for repurchase of shares of $10.6 million and repayment of loan of $1.5 million, partially offset by the proceeds from a line of credit of $0.7 million.
Previous wording
During the nine months ended September 30, 2024, there were no material changes to our contractual obligations and commitments from those described under “Management’s Discussion and Analysis of Financial Condition” which is contained in our Form 10-K and filed with the SEC on March 13, 2024.
Current wording
During the three months ended March 31, 2025, there were no material changes to our contractual obligations and commitments from those described under “Management’s Discussion and Analysis of Financial Condition” which is contained in our Form 10-K and filed with the SEC on February 28, 2025.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Net cash provided by financing activities during the three months ended March 31, 2024 was $1.6 million driven by the proceeds from a line of credit of $1.4 million.