NEW YORK – Accelerate Diagnostics reported after the close of the market on Tuesday that its third quarter revenues fell 14 percent year over year.
For the three months ended Sept. 30, the Tucson, Arizona-based firm posted revenues of $3.1 million compared to $3.6 million in the prior year, missing the consensus Wall Street estimate of $3.9 million. The company said its financial results for Q3 remain subject to quarter-end closing adjustments, which will be included in its Form 10-Q filing with the US Securities and Exchange Commission, expected within the next six days.
"The resurgence of COVID hospitalizations impacted our commercial execution in the quarter," CEO Jack Phillips said in a statement, adding, "Despite this recurring impediment to closing new accounts … our team continued to build our funnel of prospective customers, and advance our development of Arc and Pheno 2.0."
Arc is a sample preparation system designed to enable rapid MALDI-TOF pathogen identification results for infectious disease testing, while Pheno 2.0 is a next-generation pathogen identification and antimicrobial susceptibility testing system.
During the quarter, the company brought live 11 of its current Pheno ID/AST instruments and added three contracted instruments in the US. It ended the third quarter with 304 live and revenue-generating instruments in the US. An additional 86 instruments were under contract in the US and being implemented but are not yet generating revenue.
"The resurgence of COVID delayed go-lives, impacted near-term revenues, and prevented access to customers, limiting new business," Phillips said on a conference call to discuss the firm's financial results.
Worsening pandemic conditions negatively impacted its access to customers as hospitalizations caused by the Delta variant surged and non-COVID projects were put on hold. "A significant wave of healthcare and lab staff resignations left prospective customers struggling to keep up with routine lab testing, thereby delaying discussions on purchasing Pheno," Phillips said.
Throughout the pandemic, COVID-19 hospitalization levels have correlated with Accelerate's rate of new customer acquisitions and the number of new Pheno ID/AST instruments going live with testing. "Accordingly, it is encouraging that COVID hospitalization rates are now falling in much of the United States and in other countries where we operate," Phillips said, adding that during the recently completed quarter its commercial team made progress building a funnel of prospective customers but at lower rates than it normally expects.
The company reported a Q3 net loss of $9.0 million, or $.15 per share, compared to a net loss of $18.8 million, or $.33 per share, a year ago. The consensus Wall Street estimate was for a net loss per share of $.33.
The net loss for the quarter was partly offset by $10 million in income from the forgiveness of the firm's Paycheck Protection Program loan and a gain related to a convertible debt transaction it executed in the quarter, Accelerate CFO Steve Reichling said on the conference call.
Accelerate's Q3 R&D expenses decreased 6 percent year over year to $4.7 million from $5.0 million, while its SG&A costs also declined 6 percent to $10.8 million from $11.5 million due to cost-cutting efforts implemented last year.
Accelerate finished the quarter with $35.7 million in cash and cash equivalents and $21.3 million in investments.
In Wednesday morning trading on the Nasdaq, Accelerate Diagnostics shares were up more than 5 percent to $6.50.