Summary of Significant Accounting Policies (Policies) |
3 Months Ended |
|---|---|
Mar. 31, 2025 | |
| Summary of Significant Accounting Policies | |
| Basis of Presentation and Significant Accounting Policies | Basis of Presentation The accompanying unaudited condensed consolidated interim financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”) for interim financial information and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the U.S. Securities and Exchange Commission (the “SEC”). In the Company’s opinion, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of both normal recurring adjustments, and adjustments for material unusual or infrequently occurring transactions or events, which are necessary to present fairly the Company’s financial position, results of operations, and cash flows as of and for the periods presented. The Company recorded material accounting entries in the interim period ended March 31, 2025 for the preliminary purchase accounting for SeQure, Dx Inc. (“SeQure”) described in Note 8. The condensed consolidated balance sheet at December 31, 2024 has been derived from audited consolidated financial statements as of that date. The unaudited condensed consolidated results of operations are not necessarily indicative of the results that may occur for the full fiscal year or any other future year or period. Certain information and notes disclosure normally included in the consolidated financial statements prepared in accordance with U.S. GAAP have been omitted pursuant to instructions, rules, and regulations prescribed by the SEC. The Company believes that the disclosures provided herein are adequate to make the information presented not misleading when these unaudited interim condensed consolidated financial statements are read in conjunction with the audited consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K filed with the SEC on March 11, 2025 (the “2024 Form 10-K”). Significant Accounting Policies The Company’s significant accounting policies are disclosed in the notes to its audited consolidated financial statements for the year ended December 31, 2024 included in the 2024 Form 10-K and have not materially changed during the three months ended March 31, 2025. |
| Basis of Consolidation | Basis of Consolidation The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, SeQure and CCTI, Inc. All significant intercompany balances have been eliminated in consolidation. |
| Concentration of Risk | Concentration of Risk The Company maintains its cash and cash equivalents with three financial institutions that management believes to be of high credit quality. At times, the Company’s cash balances may exceed federally insured limits and cash may also be deposited in foreign bank accounts that are not covered by federal deposit insurance. The Company does not believe that this results in any significant credit risk beyond the normal credit risk associated with commercial banking relationships. Significant customers are those that accounted for 10% or more of the Company’s total revenue for the period or accounts receivable as of the end of a reporting period. During the three months ended March 31, 2025, one customer represented 29% of revenue, and another customer represented 14% of revenue. During the three months ended March 31, 2024, one customer represented 23% of revenue and another customer represented 18% of revenue. As of March 31, 2025, one customer accounted for 13% of accounts receivable, and another customer accounted for 11% of accounts receivable. As of December 31, 2024, one customer accounted for 25% of accounts receivable and another customer accounted for 14% of accounts receivable. Certain components included in the Company’s products are obtained from a single source or a limited group of suppliers. During the three months ended March 31, 2025, 22% of the Company’s additions to inventory were from one supplier. During the three months ended March 31, 2024, 30% of the Company’s additions to inventory were from one supplier. As of March 31, 2025 and December 31, 2024, no supplier accounted for 10% or more of the Company’s total accounts payable. |
| Foreign Currency | Foreign Currency The Company’s functional currency is the U.S. dollar; transactions denominated in foreign currencies are subject to currency risk. The Company recognized $19 and $33 in foreign currency transaction losses for the three months ended March 31, 2025 and 2024, respectively. |
| Accounts Receivable | Accounts Receivable Accounts receivable are reduced by an allowance for credit losses, if needed. The Company maintains an allowance for credit losses of an amount equal to anticipated future write-offs. The Company determined that no allowance was necessary as of March 31, 2025 and December 31, 2024. |
| Intangible Assets | Intangible Assets The Company recognizes acquired intangible assets at fair value on the date of acquisition. Intangible assets with definite lives are amortized over their useful lives using the straight-line method. The useful lives of the Company’s Intangible assets range from to ten years. Intangible assets with indefinite lives, including goodwill, are not amortized but subject to annual impairment testing. |
| Goodwill | Goodwill Goodwill is recorded when the purchase price paid for an acquisition exceeds the estimated fair value of the net identified tangible and intangible assets acquired. Goodwill is not amortized, but is subject to impairment analysis at least once annually, which we perform in the third quarter, or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit’s carrying amount is greater than its fair value. |
| Leases | Leases For transactions in which the Company is the lessee, at the inception of a contract, the Company determines if the arrangement is, or contains, a lease. See Note 7 for additional details about leases under which the Company is the lessee. All transactions in which the Company is the lessor are short-term (one year or less) and have been classified as operating leases. All leases require upfront payments covering the full period of the lease and thus, there are no future payments expected to be received from existing leases. See Note 3 for details on revenue recognition related to lease agreements. |
| Loss Per Share | Loss Per Share Basic loss per share is computed by dividing net loss available to common stockholders by the weighted-average number of shares of common stock outstanding during the period. For periods of net income, and when the effects are not anti-dilutive, diluted earnings per share is computed by dividing net income available to common stockholders by the weighted-average number of shares outstanding plus the impact of all potential dilutive common shares, consisting primarily of common stock options, restricted stock units, performance stock units and shares under employee stock purchase plans using the treasury stock method. For periods of net loss, diluted loss per share is calculated similarly to basic loss per share because the impact of all dilutive potential common shares is anti-dilutive. The number of anti-dilutive shares excluded from the computation of diluted loss per share, consisting of shares underlying stock options, restricted stock units, performance stock units, and shares under employee stock purchase plans was 18.7 million for the three months ended March 31, 2025 and 17.9 million for the months ended March 31, 2024. |
| Recent Accounting Pronouncements | Recent Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU amends the guidance in Accounting Standards Codification (“ASC’) 740, Income Taxes, to improve the transparency of income tax disclosures by amending the required rate reconciliation disclosures as well as requiring disclosure of income taxes paid disaggregated by jurisdiction. The rate reconciliation disclosure will be required to be presented in both percentages and reporting currency amounts, with greater disaggregation of information. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024 and should be applied prospectively, with early adoption permitted. The Company is currently evaluating the amendments to identify potential impacts to the Company’s income tax disclosures beginning with the Annual Report on Form 10-K for the year ended December 31, 2025 on a prospective basis. In November 2024, the FASB issued Accounting Standard Update No. 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures” (“ASU 2024-03”). The amendments in ASU 2024-03 improve the transparency of expenses by nature disclosures requiring disclosures disaggregating of each expense line item into specific categories, and qualitative disclosures of expenses. ASU 2024-03 will be effective for the fiscal years beginning after December 31, 2026. The Company is in the process of evaluating the impact of this ASU on its consolidated financial statements. |