Fulgent Genetics(FLGT) - 2024 Q3 - Quarterly Report

Revenue Performance - Revenue decreased by $12.9 million, or 15$84.7 million in the three months ended September 30, 2023, to $71.7 million in the same period of 2024[118]. - Revenue from laboratory services decreased by$11.5 million, or 5%, from $218.7 million in the nine months ended September 30, 2023, to$207.3 million in the same period of 2024[118]. - The decrease in revenue was attributed to a $21.0 million decline in COVID-19 testing services and a$10.5 million decrease in BioPharma services[118]. - Precision diagnostics revenue increased by $27.6 million, driven by growth in reproductive health services and specialized oncology tests[119]. - Revenue from non-U.S. sources increased by$0.3 million, or 6%, from $5.7 million in Q3 2023 to$6.0 million in Q3 2024, and increased by $3.6 million, or 25$14.6 million in the nine months ended September 30, 2023, to $18.2 million in the nine months ended September 30, 2024[123]. Operating Performance - Operating loss for the three months ended September 30, 2024, was$(17.1) million compared to a profit of $0.2 million in the same period of 2023, representing a change of$(17.3) million[117]. - Total operating expenses rose by $4.2 million, or 11$39.6 million in the three months ended September 30, 2023, to $43.9 million in the same period of 2024[117]. - The net loss attributable to Fulgent was$(14.6) million for the three months ended September 30, 2024, compared to a net loss of $(13.1) million in the same period of 2023, reflecting a change of$(1.5) million[117]. Research and Development - Research and development expenses increased by $1.8 million, or 18$10.0 million in the three months ended September 30, 2023, to $11.8 million in the same period of 2024[117]. - Research and development expenses for therapeutic development increased by$2.2 million, or 87%, from $2.6 million in Q3 2023 to$4.8 million in Q3 2024, and increased by $7.3 million, or 95$7.7 million in the nine months ended September 30, 2023, to $15.1 million in the nine months ended September 30, 2024[129]. - The company anticipates continued increases in research and development expenditures as it begins enrollment for the phase 2 study of FID-007 in Q2 2024, expecting to enroll approximately 40 patients by late 2025[129]. Cash Flow and Financial Position - Cash, cash equivalents, restricted cash, and marketable securities totaled$815.4 million as of September 30, 2024, down from $847.7 million as of December 31, 2023[140]. - Cash used in operating activities for the nine months ended September 30, 2024, was$4.0 million, a decrease from $12.1 million provided in the same period in 2023[146]. - Cash used in investing activities for the nine months ended September 30, 2024, was$30.9 million, primarily due to $374.2 million for purchases of marketable securities and$36.5 million for fixed assets[148]. - Cash used in financing activities for the nine months ended September 30, 2024, was $4.5 million, primarily related to$2.7 million for common stock withholding for employee tax obligations[150]. - The company does not expect to use any credit facilities for the foreseeable future due to a strong cash position as of September 30, 2024[151]. Expenses Overview - Consolidated cost of revenue decreased by $7.6 million, or 5$139.5 million in the nine months ended September 30, 2023, to $131.9 million in the nine months ended September 30, 2024[125]. - Gross profit decreased by$13.1 million, or 33%, from $39.8 million in Q3 2023 to$26.8 million in Q3 2024, and decreased by $3.9 million, or 5$79.2 million in the nine months ended September 30, 2023, to $75.4 million in the nine months ended September 30, 2024[127]. - Consolidated selling and marketing expenses decreased by$1.0 million, or 10%, from $10.2 million in Q3 2023 to$9.1 million in Q3 2024[130]. - Consolidated general and administrative expenses increased by $3.5 million, or 20$17.5 million in Q3 2023 to $21.0 million in Q3 2024[133]. Tax and Other Income - The effective tax rates were 21$8.1 million and $23.2 million in Q3 2024, compared to$6.5 million and $15.8 million in Q3 2023, respectively[137]. Stock Repurchase Program - As of September 30, 2024, approximately$150.5 million remained available for future repurchases of common stock under the stock repurchase program[153]. - The stock repurchase program authorized in March 2022 amounts to $250.0 million with no expiration date[152].