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Hello, and thank you for standing by. My name is Tiffany, and I will be your conference operator today. At this time, I would like to welcome everyone to the Quanterix Corporation Q3 2025 Earnings Call. [Operator Instructions] I would now like to turn the call over to Joshua Young, Head of Investor Relations. Joshua, please go ahead.

Thank you, Tiffany. And good afternoon, everybody. With me on today's call are Masoud Toloue, Quanterix's President and CEO; and Vandana Sriram, Quanterix's Chief Financial Officer. Today's call is being recorded, and a replay of the call will be available on the Investors section of our website. During the course of today's presentation, we will make forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act. These forward-looking statements are based on management's beliefs and assumptions as of today, November 10, 2025. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. To supplement our financial statements presented on a GAAP basis, we have provided certain non-GAAP financial measures. These non-GAAP measures are used to evaluate our operating performance in a manner that allows for meaningful period-to-period comparison and analysis of trends in our business and our competitors. We believe that such measures are important in comparing current results with other periods results and assessing our operating performance within our industry. Non-GAAP financial information presented herein should be considered in conjunction with and not as a substitute for the financial information presented in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to the most directly comparable GAAP financial measures set forth in the presentation posted to our website and in the earnings release issued today. Finally, any percentage changes we discuss will be on a year-over-year basis unless otherwise noted. Now I'd like to turn the call over to Masoud Toloue. Masoud?

Thank you, Joshua. We're pleased with how we executed in the third quarter, especially given the significant integration work underway and the challenging industry conditions we continue to navigate. This quarter reflects the strong execution, focus and resiliency of the Quanterix team who've continued to deliver results while driving major integration milestones and advancing key strategic initiatives. I'd characterize the third quarter around a few key themes. First, we delivered on our revenue expectations in a demanding environment. Second, we're moving fast and hitting key integration milestones following our acquisition of Akoya. In just over 3 months since the closing of the transaction, we're operating as one company under one common infrastructure and leadership team. We've created meaningful scale, built a stronger foundation for growth and already realized $67 million of the $85 million in synergies we're targeting. Third, we continue to invest for growth. We're making significant investments in Alzheimer's diagnostics and in new assays across our Simoa and Spatial franchises. Year-to-date, we've invested roughly $27 million in R&D, just under 30% of our revenue, which underscores our conviction in the opportunities ahead and the innovation pipeline we're building. And finally, we remain disciplined in managing our cash. We're on track to finish the year with around $120 million in cash and no debt and will be cash flow breakeven in 2026. We generated $40 million in revenue in Q3, a solid start to our first quarter operating the Simoa and Spatial portfolios under one umbrella. While demand across the broader industry remains uneven, we're seeing signs of stabilization, particularly in academic, government and pharma markets. Instrumentation and accelerator revenues were both up sequentially, signaling a gradual recovery that we expect to continue over the next few quarters. Since bringing Simoa and Spatial together, we're already seeing early commercial momentum. Customers are increasingly interested in combining tissue and blood insights, and we're starting to see real cross-selling opportunities between both portfolios. This is expanding our presence across leading pharma and academic customers where multimodal biomarker strategies are becoming an important focus. We're also seeing early activity in oncology where both platform sensitivity and reproducibility are proving valuable in emerging liquid biopsy and tumor profiling applications. These are still early days, but the traction we're seeing reinforces the strategic power of bringing these two technology platforms together and the potential to unlock entirely new growth avenues for Quanterix. The integration itself is progressing very well. We had three clear goals when we started. First, build one Quanterix organization under a unified leadership team; second, continue delivering on our core revenue expectations while positioning to capture tissue to blood-based opportunities; and third, capture meaningful cost synergies from the transaction. We've made substantial progress on all three fronts. We've consolidated four manufacturing and lab service operations into two Quanterix sites. We're fully aligned under one structure. And as I said, we've already implemented $67 million of the $85 million in targeted cost synergies. That's a strong start, and it gives us the flexibility to keep investing in growth while improving profitability. We're also making some of the most significant R&D investments in our history. We're developing our next-gen platform, advancing our Alzheimer's diagnostics programs and expanding our assay portfolio across Simoa and Spatial. We'll soon launch an early access program for Simoa One to give key partners hands-on experience with the technology and gather feedback ahead of a broader launch. We believe this will be an important catalyst for future instrument growth. In Alzheimer's diagnostics, we received a positive pricing recommendation to crosswalk our LucentAD test at $897 with a final approval decision expected later this quarter. We also added 4 diagnostics partners in Asia, extending our reach and making high sensitivity, clinically relevant biomarker testing available to more patients worldwide. Diagnostics-related revenue was $2.4 million in the quarter, another step in the right direction. On the balance sheet, we remain in a strong position. The cost reductions from our integration activities are driving real improvements in cash performance. We expect to exit the year with about $120 million in cash and no debt, supported by improved working capital and a full quarter benefit from the synergies in place. We're building a stronger, more agile and more scalable company. With integration advancing ahead of plan, early commercial synergies taking hold and continued leadership in neurology and diagnostics innovation, we're laying the foundation for sustained growth, profitability and impact. Our progress this quarter is a testament to the dedication and talent of the Quanterix team and the momentum we're building together positions us well for long-term success. Now I'll turn over the call to Vandana.

Thank you, Masoud, and good afternoon. As a reminder, we closed Akoya on July 8, so the following results represent a partial quarter of Akoya's operating performance and excludes $600,000 of revenue recognized by Akoya in the first week of July. Total revenue for Q3 was $40.2 million, an increase of 12% year-over-year. From a product perspective, Simoa contributed $23 million, a 36% organic revenue decline and Spatial reported $17.2 million, down 9% year-over-year. Spatial revenues include $1.2 million of noncash revenue from an off-market contract. Instrument revenue was $7.2 million, $2.5 million in Simoa and $4.7 million in Spatial instruments. We placed 16 Simoa and 27 Spatial instruments in the quarter as compared to 13 Simoa instruments in the third quarter of '24. Consumable revenue was $18.8 million, which consisted of $12.3 million in Simoa and $6.5 million in Spatial consumables. Accelerator lab revenue was $8 million, $5 million in Simoa and $3 million in Spatial. Simoa Accelerator lab revenue of $5 million increased sequentially by $1 million in the quarter. Our organic revenue decline was driven by weakness in the U.S. academic and pharmaceutical end markets. For consumables, the number of orders this quarter were consistent year-over-year, and we had a net increase in the number of accelerator projects. But in both cases, the dollars per order or project were lower than last year, driving the decline in revenue. Our customer mix was evenly split between pharma and academia in the quarter. On a pro forma basis, including Spatial revenues, U.S. academic revenue declined approximately 30%, which is tracking to the decline in academic grants. Pharma revenue declined 23% year-over-year. Gross profit and margin were $17.2 million and 42.8%, respectively. Non-GAAP gross profit was $18.5 million and non-GAAP gross margin was 45.9%. The alignment of Akoya's accounting policies to Quanterix resulted in the reallocation of certain Akoya expenses into cost of sales, causing a reduction of approximately 900 basis points to the combined company's gross margins, which was then offset by the favorable impact of synergies. Operating expenses for the quarter were $54.5 million. Included in operating expenses are approximately $15 million of costs related to acquisition, integration, restructuring and purchase accounting and $1.3 million of shipping and handling costs. Non-GAAP operating expenses were $38.2 million, an increase of $7.1 million sequentially. I'd like to comment here on the synergy realization from the Akoya transaction. These synergies are in three areas: firstly, the alignment of the commercial organizations into one; secondly, the integration of the supply chain into one manufacturing operation and one lab; and thirdly, the elimination of duplicate public company costs. Prior to the acquisition, Akoya had a run rate of nearly $20 million of quarterly operating expenses. So the $7.1 million sequential increase in spending for the combined company really highlights the impact of the swift action we've taken to capture cost synergies. Our adjusted EBITDA was a loss of $11.9 million as compares to a loss of $5.5 million in the third quarter of the prior year. We ended the quarter with $138 million of cash, cash equivalents, marketable securities and restricted cash. During the quarter, we paid approximately $126 million in deal-related costs, which includes the debt pay down, shareholder payments, severance and other expenses. We acquired $16.8 million in cash from Akoya. Adjusted cash usage during the quarter was $16.1 million. I will now turn to our updated guidance for the year. We continue to expect to report $130 million to $135 million of revenue for 2025. This assumes approximately $100 million to $105 million of Simoa revenue and implies pro forma revenue of $165 million to $170 million for '25, assuming the 2 companies were combined for the full year. We expect GAAP gross margin to range between 45% and 47% and non-GAAP gross margin to be in the same range. We've tightened the gross margin ranges versus our prior guide as we know more about the effects of integrating Akoya, and these account for the allocation changes I touched upon earlier. None of the allocation changes impact our cash construct. And finally, on to cash. We continue to expect adjusted cash usage of $34 million to $38 million for the full year. We ended the third quarter with $138 million in cash. For the fourth quarter, we expect to pay $10 million for the Emission acquisition, which was completed earlier this year and to use approximately $8 million cash in operations. The sequential cash improvements from $16 million of adjusted cash usage in Q3 is expected to come from incremental synergy realization in the quarter as well as working capital improvements. This keeps us on track to end 2025 with approximately $120 million in cash and with no debt. With that, I will now turn it back over to Masoud.

Thank you, Vandana. Operator, let's take some questions.

[Operator Instructions] Your first question comes from the line of Kyle Mikson with Canaccord.

So just looking at the core, the Quanterix business, Simoa, consumables were down, I think, 30% or so year-over-year. I know there were a similar number of orders, but there were lower dollars per order. But could you just really kind of dive into that and elaborate on what's happening there competitively and macro-wise and if you're confident that can rebound maybe next year?

Kyle, so I'll take that first question. So yes, on the consumable side for Simoa, as you articulated, the order volume was consistent with last year, but the order size was smaller, which explained the entire decline. So what we're seeing on the academic side are project sizes that weren't the same size as they were last year. And so from a customer perspective, we're getting the same number of customers ordering the products, just project sizes is smaller than it was in the prior year. And we're really attributing that to the basic academic grant environment that we're in, which we saw less of in the prior year. And I think we're seeing also the same thing on the Accelerator side. We saw an actual double-digit increase in total number of accelerator projects this quarter how -- but those projects are smaller in scope versus '24. So it's still a sticky business, and we expect those smaller projects to scale in '26.

All right. Got it. And then as I look to the 4Q '25 kind of plans to implement more synergies, I think one aspect is building out this one manufacturing team and other is the combining of the lab services. And I feel like that's probably an Accelerator illusion. So [indiscernible] Spatial has already done $3 million in the quarter, which was good to hear. Could you just again kind of walk through what the plan holds for 4Q just because it seems like the last leg of the stretch here, and it seems like it could be more challenging than it seems on the surface.

Kyle, I think you're referring to the integration chart that we put together with Simoa and Spatial. And so in Q4, we've already implemented the single manufacturing team and we're now combining lab services. And when we say combining lab services, we're already in under one footprint, and we've combined both labs. We're operating out of a single building. And what we're looking for is some additional synergy opportunities as we get down the final stretch. Those include synergies that we see -- opportunities we see in the lab side. But then also as we enter at the beginning of next year, we'll have the company running on a single ERP with all systems and financials integrated into one organization. So we expect to pick up the remaining part of our synergies as we round out the first quarter. So you mentioned it could be difficult. I think we're ahead of schedule with what we've done so far. I would call the implementation of the operating lines, probably some of the most challenging parts of the integration. And now we're actually see good line of sight towards the end and the full $85 million of synergy.

All right. Great. And then finally, just on diagnostics, $2.4 million in revenue in the quarter. As we think about the CLFS later this month or this quarter, how should we think about kind of durable Medicare coverage and the payment rate being close to the $897 and then maybe next year, again, is this like an inflection year for that business for Lucent?

Yes, that's a great point. We got the preliminary reimbursement recommendation. We expect to hear back by the end of this quarter on something definitive. And you make a good point. We're now, I think, for the first time, basically sending up providers, taking orders and we didn't have that in the beginning of the year. So we do expect to gain some traction based on this pricing. And this is the beginning part of our diagnostic journey. What we need to do is continue to deliver on our clinical utility studies, which show that a five-marker algorithmic test outperforms single marker tests and gets the value that we've initially been assigned. So we think it's a beginning part of the journey, but a lot more traction in '26 versus '25.

Your next question comes from the line of Dan Brennan with TD Cowen.

Congrats on the quarter. Maybe just on the Akoya business, can you just walk through kind of the assumptions kind of in the fourth quarter, I guess, so what you did $17 million this quarter. And it's $30 million for the back half. Is that right? So it's $13 million in the fourth quarter. Is that right? Just kind of -- I know it's simple math, but just walk through what you're assuming in the fourth quarter for Akoya?

Yes. So we got off to a really good start on the Akoya transaction and $17 million of revenue in the third quarter. For the fourth quarter, we've modeled a slight step down simply because there's a level of uncertainty in the market still. There's still questions on when funding will really start to flow down. So we've derisked Q4 just given the uncertainty in the market. Now of course, if that were to change, then Spatial would be in a position to take advantage of that.

Got it. I mean were there any like one-off issues in the quarter where you had more success maybe getting some orders in, like any pull forwards? Or you just executed really well and kind of got that $17 million in the door?

Yes. Again, it was just solid execution from the team. There wasn't anything material or anything pull forward. So it was good traction. And this is the first quarter we had both teams, everything -- all product lines were under the same umbrella. So even in that circumstance, when you combine two organizations, I'd say that our commercial team did a fantastic job.

Got it. And then just on the kind of high-level core Quanterix, I mean, I guess the fourth quarter guide assumes kind of flat to down, but -- or at the higher end up, a decent step up. Just kind of you commented in the prepared remarks, you're seeing improvement and improving signs in pharma and academia. Maybe can you just speak to a little bit of like what you're specifically seeing and kind of how you've tried to characterize that in kind of the core Quanterix fourth quarter guide?

Yes. So when we look at the full year, you'll notice we haven't changed the full year guide. And I think that's what you see is us being prudent, and we're still under a government shutdown, and there's just some uncertainty. So we want to be realistic and conservative on the fourth quarter. The -- on your commentary along the lines of performance, I think we were very happy with the outcome of Q3 and going into Q4, we saw sequential -- actually, going into Q3, we saw sequential improvement in both Accelerator and Instruments. We saw a greater number of projects coming in through our pharma customers in Accelerator. We hope that, that basically continues going into the fourth quarter and going into 2026. So we can keep that momentum going up. We're excited about '26 even in the pressured environment.

Got it. And then maybe one other just in terms of the cross-selling opportunity, which I don't think you guys formally baked in anything, but you made a bunch of comments early in on the prepared remarks about early success there. Just maybe a little bit more on that. And you kind of look ahead, like are you already starting to see some incremental wins? Or how do we think about the cross-selling opportunity?

Yes. Early days, it's been positive, Dan. If you take a look at both consumables portfolio, Simoa, it has the #1 liquid biomarker franchise everywhere. And then Spatial, we have the #1 protein tissue biomarker panels versus anything else out there. So -- what we did immediately was that we talked to our neurology customers, and they're interested in understanding where these proteins are moving along the brain and the early signs of Alzheimer's and how this grows from tau tangles to plaque to conditions for a patient. So we're seeing some of our Simoa customers interested in -- and actually making purchases for the Spatial product line. And then on the other side, we're seeing on the oncology or immuno-oncology side, formerly Akoya customers wanting to measure and track these biomarkers in blood. So I'd say we have probably a double-digit list of opportunities that we're tracking and early days have been positive.

And sorry, truly final one, like 2026, will we get the first update at JPMorgan? Will it be on the fourth quarter call? Most companies are kind of saying something at this point. Any early read? I don't know if you were -- if you were consensus has landed. Just wondering kind of how we might think about an early look at next year?

Yes. We're not going to provide sort of the '26 guidance on this call. We typically do it on our last quarter call for the year. So I think we'd continue to wait there. But I just want to reiterate, we've made -- '25 was a big investment year for the company. We've made a lot of investments in the product and service portfolio. And so we expect to enter '26 with real momentum.

Your next question comes from the line of Puneet Souda with Leerink Partners.

Just wondering what you're accounting for the government shutdown, if there was any impact that you're thinking about in the fourth quarter? And then just how should we think about -- if the shutdown is over now, how should we think about the recovery or potential for maybe slight upside if the government shutdown was to end and normalcy was to reverse in the academic accounts?

Yes. Thanks for the question, Puneet. We did take the government shutdown into account as we set our Q4 guide, and that was the primary reason for the slight deceleration on a quarter-over-quarter basis. Q4 tends to be a tough quarter with all of the holidays, et cetera, and we are about halfway through the quarter already. So we thought it prudent to hold the guide and reflect that impact. We don't think it gets worse than that. If there is any kind of year-end flush or if the government opens up sooner than expected, that would be favorable to us from a revenue perspective. But we do think we've bottomed out the risk here.

Okay. And then Masoud, a bigger high-level question for you around competition. I mean I hear your comments on academic weakness backdrop is tough. We all know that. But how do you plan to address the significant market competition that is emerging from high sensitivity, high multiplex platform on the discovery side and academic discovery side as well, especially in neurology and pharma and biotech as well, at least on the discovery side, I could say we can -- we're seeing more of that. So just wondering how do you think about that? I appreciate your clinical trial business is not impacted, but how do you compete more aggressively on the discovery side of the business?

Yes. Puneet, thanks for the question. So just for clarity, we really compete in the 4 or 5 marker space, which is a lot more of a translational segment. So if a customer is interested in looking at something that's a 20 to 1,000 Plex, we really don't play in that part of the market. Now we acknowledge that, that's a fast-growing segment, and that's great for Quanterix because as discovery accelerates as new markers are identified by customers doing 1,000 or 100 Plex, that really translates, usually 4 or 5 markers come out of those studies, and that translates to more business for Quanterix. So we're very happy with that discovery progress and expect new markers to come into our pipeline. Overall, from a competitive standpoint, I think basically, orders were on the consumable side, flat, which is good -- of good performance given sort of some of this academic shutdown and grant instability. So overall, we're not losing any share. In fact, we're gaining share in some of the diagnostics segments and clinical trial studies as we are able to do 4 markers, 5 markers with our algorithm, we provide unique insights that you just can't get with a single marker. So high plex discovery, good for Quanterix, translational single marker, we've been able to identify a great solution on the clinical side.

Okay. And then last one for me. Could you remind us what was the volume for you in LucentAD in the quarter? And how should we think about the volume ramp in '26? Wondering if you can provide an update on the commercial end of that? And just related, out of that volume, how should we think about the new pricing applying to what portion of that volume?

Yes. So I'll let Vandana answer the question on the revenue. But for diagnostics, we're going to be entering '26 with an established pricing recommendation. It's just something we didn't have this year. And so that positions us really for stronger traction and growth in the segment. And so when you look at current revenue, it's mainly through partner enablement where this is basically customers buying a platform, buying consumables, buying tests and running it through their own LDT laboratories or reference hospitals and reference laboratories. And that really makes up the majority of our diagnostics revenues. We are, as I said on the call, running patient samples and through our own CLIA, LDT lab and that continues to increase, and we expect with established pricing that to, as I said, give us more traction and growth next year.

Yes. Maybe just to add to that. We don't disclose our direct testing revenues and volumes just yet. But as they start to get meaningful and material, most likely next year, we'll start to talk about that. The one point I'd make on the enablement side is this is an area where we are starting to see a really steady business now. Over the last several quarters, it's been a little bit lumpy depending on one deal or the other. But we're now reaching a point where our enablement partners are regularly starting to buy consumables, and that is helping to hold the revenue at a fairly steady level each quarter. Year-to-date, we've done about slightly north of $6 million of revenue already versus $6 million for the whole of last year. So we are definitely seeing an uptick in our partners using our single marker test for testing as well.

Your next question comes from the line of Thomas DeBourcy with Nephron Research.

Just first, I was just wondering if you could clarify the difference between, I guess, your cost reductions implemented versus, I guess, cost reductions realized because even if I annualize those, there's a little bit of a gaps. So just can you help me reconcile the two?

Yes, sure. I can take that. So the cost reductions annualized is the full year impact of an action that you'll see in the 2026 time frame. What's realized in the quarter is true dollar savings that fell through within the quarter. So for example, if you take some of the leadership changes that happened, 2 months' worth of impact is captured in that $12 million number. But when you look to next year, that would really be a full 12 months' worth of impact.

Understood. And then just, I guess, on the instrument side, obviously, that's been difficult for pretty much everyone in the market. Just in terms of kind of as you look at improvement in the end market, hopefully, in the near future, would you expect to see, I guess, more of a rebound in lab services ahead of potential instrument placements? Or just how are you thinking about how that might materialize?

Yes, Tom, we're already seeing increase in numbers of projects through the Accelerator program. Now there's certainly some quarterly ups and downs on services. And as those smaller projects become larger, we expect some smoothing out of that volume. So we're already seeing an uptick on the Accelerator side. It's just a matter of time on -- as these projects become larger or more spending happens, that will improve. And I do expect it to perform that way to see services outperform sort of consumable instrument uptick in the following quarters. Instruments performed well. We obviously want to place those, as you know, across the franchise now both our HD-X, our [ HT ] and the PhenoCycler, they're all high-volume instruments with the capacity to run high volumes of consumables, and we're going to continue our work in making sure we get these placed globally.

Your next question is a follow-up from Kyle Mikson with Canaccord.

On the point there about instruments on Simoa One, I just wanted to ask about the time line there because I thought it was supposed to be launched by the end of '25, but it sounds like now there's an early access program for that. So again, how should we think about this product as being like an incremental inorganic source of revenue growth like next year? It sounds like it could be big, but I mean, what's the funnel kind of look like? Like what do you expect for that, Masoud?

Yes. We've been working with a handful of customers, and they're certainly excited to get access to higher sensitivity compared to where we are today and the ability to plex even further. And so we're going to be kicking off an early access program before the end of the year, where we're going to give early access, get feedback from our customers before we go and move forward with a full launch. Revenue contribution, we haven't talked about that in '26. We'll provide an update on our next quarter call.

All right. Great. And then finally, on the Asia kind of updates for LucentAD, I mean, when does that become material? Like what are the steps of sort of unlocking revenue in overseas internationally for that test, given it's not -- it's obviously unprecedented?

Yes. I think what you see in some of the collaborations we've done right now in Southeast Asia, we're basically kind of early stages, but we're already seeing the opportunity in China. We have a couple of partners there. Partners have already received IVD approval for the platform, and they're moving ahead with testing patients and getting the system out to laboratories across the country. So good signs there. The drug is available. Patients want access, and they're using our test. So that's been a decent contributor to our diagnostics revenue.

Got it. And finally, you've reduced R&D spending quite a bit. I'm just kind of curious if you aim to sort of increase that next year as you think about, again, the small one, you have other products coming out just to maintain a competitive stance and sort of drive growth as well over time because you have a lot of synergies to be taken out -- or sorry, investments to be taken out the business so you need kind of investment to drive more growth. How do you -- what do you think about that kind of a concept?

Yes. So we've been pretty disciplined about the synergies, and we've been careful to make sure that we maintain all of our investment in our growth areas. So R&D is down a hair, but that's mainly because there's some reallocation of some of Akoya's R&D cost into cost of sales. And on the Simoa side, there's been a little bit of pruning and a little bit of housekeeping, but all of our strategic investments are very much intact. So we're still allocating capital to Simoa One as well as diagnostics as well as on assay development, both for Simoa and Spatial. As we go into 2026, some of these programs will come to a natural end. Other programs will start off. But our intention is that we'll continue to balance R&D as a priority item even going into '26.