On May 10, 2022 NanoString Technologies, Inc. (NASDAQ:NSTG), a leading provider of life science tools for discovery and translational research, reported financial results for the first quarter ended March 31, 2022 (Press release, NanoString Technologies, MAY 10, 2022, View Source [SID1234614083]).

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First Quarter Financial Highlights

Product and service revenue of $30.8 million
GeoMx Digital Spatial Profiler (DSP) revenue of $9.7 million. GeoMx DSP revenue includes:
Instrument revenue of $4.8 million, 31% year-over-year decline
Consumables revenue of $4.9 million, 78% year-over-year growth, annualized pull-through of approximately $76,000 per installed system
nCounter revenue, inclusive of all service revenue, of $21.1 million. nCounter revenue includes:
Instrument revenue of $4.3 million, 11% year-over-year decline
Consumables revenue of $12.6 million, 5% year-over-year decline, annualized pull-through of approximately $48,000 per installed system
Service revenue of $4.3 million, 16% year-over-year growth
Cash, cash equivalents and short-term investments balance of $312.1 million
"We have begun to address the challenges we experienced in the first quarter, and we believe we have the sales team and commercial structure in place to execute our long-term growth strategy" said Brad Gray, president & CEO of NanoString. "Overall growth and customer interest in spatial biology remains robust, as evidenced by the strong demand for CosMx SMI that we experienced during the first quarter."

Operational Highlights

GeoMx DSP

GeoMx Installed Base: Grew installed base to approximately 295 GeoMx DSP Systems at March 31, 2022, representing 84% growth over the prior year
Workflow Automation: Partnered with Leica, a division of Danaher, to provide a fully automated workflow for using the Leica Bond RX system to prepare slides for GeoMx DSP
American Association of Cancer Research: Highlighted a record body of more than 120 Nanostring-enabled abstracts, including more than 35 abstracts focused on spatial biology
Publications: Continued growth of peer-reviewed publications utilizing GeoMx DSP technology, with approximately 20 new publications in the first quarter, bringing the cumulative total to approximately 110 peer-reviewed publications as of March 31, 2022
CosMx SMI

CosMx Orders: Secured customer orders for more than 15 CosMx Spatial Molecular Imager (SMI) systems, bringing total orders to date to more than 35 systems
Development Status: First CosMx beta systems placements expected during the second quarter and the program remains on track for full commercial launch in the fourth quarter of 2022.
nCounter

nCounter Installed Base: Grew installed base to approximately 1,070 nCounter Analysis Systems at March 31, 2022, representing 8% growth over the prior year
nCounter Pro Analysis System Launch: Launched the nCounter Pro Analysis System, the next generation of the nCounter instrument platform, which includes a new operating system, modern cybersecurity improvements and an expansive menu to support biomanufacturing and translational research
Publications: Surpassed 5,250 cumulative peer-reviewed publications utilizing nCounter technology at March 31, 2022
Corporate

Appointment of New Board Member: Expanded the Board of Directors with the appointment of Dr. Teresa Foy, senior vice president, Immuno-Oncology and Cell Therapy, Bristol Myers Squibb
2022 Outlook

The company updated its 2022 outlook, with results expected as follows:

Total product and service revenue of $150 to $160 million, as compared to previous guidance of $170 to $180 million
GeoMx DSP revenue of $60 to $65 million, as compared to previous guidance of $73 to $78 million
nCounter revenue, inclusive of all service revenue, of $90 to $95 million, as compared to previous guidance of $97 to $102 million
Adjusted EBITDA loss of $65 to $75 million, as compared to previous guidance of $55 to $65 million
Financial Results

We have elected to present selected non-GAAP, or adjusted, financial measures, including Adjusted EBITDA. These adjusted financial measures are calculated excluding certain items that may make it more challenging to compare our GAAP operating results across periods. Such items may include collaboration revenue, stock-based compensation, depreciation and amortization, or one-time charges such as transaction related fees and expenses or restructuring charges and severance costs. A reconciliation of adjusted financial measures to the nearest comparable GAAP financial measure can be found in the notes and table at the end of this press release.

Supplemental Information

As a supplement to the table above, we have posted to the investor relations section of our website, at www.nanostring.com/Investor Relations/Financials/Quarterly Results, supplemental financial data that include our adjusted financial measures as compared to the nearest comparable GAAP financial measures, for the first quarter of 2022 and for each quarter and the full year of 2021.

Conference Call

Management will host a conference call today beginning at 1:30 pm PT / 4:30 pm ET to discuss these results and answer questions. Investors and other interested parties can register for the call in advance by visiting View Source After registering, an email confirmation will be sent including dial-in details and unique conference call codes for entry. Registration is open throughout the call, but to ensure connection for the full call, registration in advance is recommended. The link to the webcast and audio replay will be made available at the Investor Relations website: www.nanostring.com. A replay of the call will be available beginning May 10, 2022 at 7:30pm ET through midnight ET on May 17, 2022. To access the replay, dial (866) 813-9403 or (929) 458-6194 and reference Conference ID: 221442. The webcast will also be available on our website for one year following the completion of the call.

Non-GAAP, or Adjusted, Financial Information

We believe that the presentation of non-GAAP, or adjusted, financial information provides important supplemental information to management and investors regarding financial and business trends relating to our financial condition and results of operations. Reconciliation of adjusted financial measures to the most directly comparable financial result as determined in accordance with GAAP are included at the end of this press release following the accompanying financial data. A reconciliation of adjusted guidance measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding certain expenses that may be incurred in the future. For further information regarding why we believe that these adjusted measures provide useful information to investors, the specific manner in which management uses these measures and some of the limitations associated with the use of these measures, please refer to "Notes Regarding Non-GAAP Financial Information" at the end of this press release.