• Revenue: $7.8 million for Q2 2024, a 10% year-over-year decrease.

• OGM Installed Base: Grew to 363 systems, a net increase of 16 systems and 29% growth year-over-year.

• Flow Cells Sold: 6,165 in Q2 2024, a 13% year-over-year decrease.

• GAAP Gross Margin: 33% in Q2 2024, up from 27% in Q2 2023.

• Non-GAAP Gross Margin: 35% in Q2 2024, up from 29% in Q2 2023.

• GAAP Operating Expense: $19.6 million, a 53% decrease year-over-year.

• Non-GAAP Operating Expense: $18.8 million, a 46% decrease year-over-year.

• Cash and Equivalents: $30.3 million as of June 30, 2024, with $11.4 million subject to restrictions.

• Debt Restructuring: $20 million in senior secured convertible debentures outstanding as of June 30, 2024.

• Q3 2024 Revenue Guidance: $7.9 million to $8.9 million.

• Full-Year 2024 Revenue Guidance: Adjusted to $36 million to $40 million.

• Warning! GuruFocus has detected 6 Warning Signs with BNGO.

Release Date: August 07, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Bionano Genomics Inc (NASDAQ:BNGO) received approval for a Category 1 CPT code for optical genome mapping, which is expected to significantly increase adoption and utilization.

• The OGM installed base grew to 363 systems, representing a 29% growth over the previous year.

• The company entered a Software Marketing Agreement with Revvity, enhancing its market presence and potential revenue streams.

• Publications related to Bionano's technology increased by 37% in the first half of 2024 compared to the same period in 2023, indicating growing academic and clinical interest.

• Bionano reported a significant reduction in operating expenses, with a 46% decrease in non-GAAP operating expenses compared to the previous year.

Negative Points

• Revenue for Q2 2024 was $7.8 million, a 10% year-over-year decrease, partly due to a 53% reduction in revenues from discontinued clinical services.

• The number of flow cells sold decreased by 13% year-over-year, marking the first decline in 20 consecutive quarters.

• Underperformance in China due to OEM partners and key customers falling behind on purchases, with an estimated shortfall of 1,200 flow cells.

• Challenges in the Americas region due to the transition from Saphyr to Stratys systems and reduced field sales and support teams.

• The company adjusted its full-year 2024 revenue guidance downwards to $36 million to $40 million, citing challenges in China and other regions.

Q & A Highlights

Q: In regards to your lower guidance, is that mostly based on lesser staffing or the transition to the Stratys system? A: The guidance shift is primarily due to underperformance in China, which accounts for the $1 million adjustment. The staffing and Stratys transition effects are considered transient and expected to be resolved over the year. - R. Erik Holmlin, CEO

Q: What are the broader implications of the multisite study results in multiple myeloma, and how will you leverage these findings? A: The study highlights OGM's potential in multiple myeloma, expanding adoption opportunities. It shows OGM's effectiveness without relying on cell growth, which is significant for hematological malignancies. These results will support insurance coverage decisions. - R. Erik Holmlin, CEO

Q: Can you provide more details on the Ionic system's commercial launch and the backlog of interested parties? A: The Ionic system, acquired from Purigen Biosystems, offers superior ultrahigh molecular weight DNA isolation. Pre-commercial testing is positive, and there's strong interest from high-volume labs. We're cautious about building a sales pipeline until the product is ready. - R. Erik Holmlin, CEO

Q: Regarding the recent CPT code for reimbursement, when should changes in revenue be expected? A: The CPT code will be effective in early 2025, with pricing and coverage determinations to follow. While it aids sales, revenue impact will be gradual as coverage unfolds, influencing adoption and utilization. - R. Erik Holmlin, CEO

Q: What role will the Revvity deal and software as a service play in your forecasting? A: The Revvity deal enhances our software's role in NGS data analysis, complementing OGM. We foresee more deals and end-user sales, contributing significantly to revenue and margins, given the software's high value and growth potential. - R. Erik Holmlin, CEO

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.