NEW YORK – HTG Molecular Diagnostics reported after the close of the market on Wednesday that its first quarter revenues dropped 31 percent year over year.
For the three months ended March 31, the Tucson, Arizona-based firm's revenues fell to $2.2 million from $3.2 million in the same period the year before, due to the impact of the COVID-19 pandemic requiring the closure of customer facilities around the globe. The firm missed the consensus Wall Street estimate of $3.0 million.
Revenues from products and product-related services — which include the sales of instruments and consumables — dropped 26 percent to $2.0 million from $2.7 million. The firm said that the decrease in direct revenue reflects a decline in lower-margin, subcontracted laboratory services revenue reflected in research-use-only sample processing revenue.
HTG highlighted that it achieved several internal milestones during the quarter, including the completion of 23,000 probes for a whole-transcriptome EdgeSeq product at its San Carlos, California lab. In addition, the firm's lab in Tucson finished two retrospective trials for an undisclosed biopharma partner and a comprehensive validation report for its existing RUO assays.
Revenues from collaborative development programs fell 56 percent to $237,337 from $540,432 in the year-ago quarter.
"With the COVID-19 pandemic impacting businesses globally, the first quarter of 2020 was unlike anything we would have anticipated," HTG Molecular CEO John Lubniewski said in a statement. "While we cannot be certain of the ultimate impact of the COVID-19 pandemic on us or our customers, we are optimistic that demand for our products and services will return."
On a conference call with investors following the release of earnings, Lubniewski added that HTG expects to continue to see growth in its biopharma profiling business, noting that the firm currently has 70 active programs. While only signing four new biopharma programs this quarter, HTG expects to have more than 100 by the end of 2020.
"As work-from-home regulations are eased, we expect the academic profiling business to return fairly quickly, both in Europe and in the US," Lubniewski said. " We've already installed two instruments at an academic customer this month." HTG's Q1 net loss fell to $5.5 million, or $.08 per share, from $5.4 million, or $.19 per share a year ago. Analysts on average expected a loss per share of $.10.
The firm's R&D spending in the quarter dropped almost 10 percent to $1.9 million from $2.1 million. Meanwhile, its SG&A costs grew 7 percent year over year to $4.7 million from $4.4 million.
HTG ended Q1 with cash and cash equivalents of $10.4 million, short-term investments available for sale at fair value of $21.6 million, and restricted cash of $3.3 million.
Last month, Maureen Cronin stepped down as the firm's CSO and senior VP.
In Thursday morning trading on the Nasdaq, HTG's stock was down 6 percent at $0.34.