PSNL Personalis Inc

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

 

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission File Number: 001-38943

 

 

Personalis, Inc.

(Exact Name of registrant as specified in its charter)

 

 

Delaware	27-5411038
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
6600 Dumbarton Circle Fremont, California	94555
(Address of principal executive offices)	(Zip Code)

 

Registrant’s telephone number, including area code: (650) 752-1300

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.0001		PSNL		The Nasdaq Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated filer

☐

Non-accelerated filer

☒

Smaller reporting company

☒

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of registrant’s Common Stock outstanding as of August 1, 2023 was 48,518,901.

 

 

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PERSONALIS, INC.

 

Form 10-Q

For the Quarterly Period Ended June 30, 2023

 

TABLE OF CONTENTS

 

		Page
	Note Regarding Forward-Looking Statements	3
PART I—FINANCIAL INFORMATION
Item 1.	Financial Statements	4
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statements of Operations	5
	Condensed Consolidated Statements of Comprehensive Loss	6
	Condensed Consolidated Statements of Stockholders’ Equity	8
	Condensed Consolidated Statements of Cash Flows	9
	Index to Notes	10
	Notes to Unaudited Condensed Consolidated Financial Statements	11
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28
Item 4.	Controls and Procedures	28
PART II—OTHER INFORMATION
Item 1.	Legal Proceedings	29
Item 1A.	Risk Factors	29
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	70
Item 3.	Defaults Upon Senior Securities	70
Item 4.	Mine Safety Disclosures	70
Item 5.	Other Information	70
Item 6.	Exhibits	71
	Signatures	72

 

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NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including statements regarding our future results of operations or financial condition, business strategy and plans, and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “objective,” “ongoing,” “plan,” “potential,” “predict,” “project,” “should,” “will,” or “would” or the negative of these words or other similar terms or expressions. These forward-looking statements include, but are not limited to, statements concerning the following:

Actual events or results may differ from those expressed in forward-looking statements. As such, you should not rely on forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Quarterly Report on Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, operating results, prospects, strategy, and financial needs. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, assumptions, and other factors described in the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q. Moreover, we operate in a highly competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report on Form 10-Q. The results, events and circumstances reflected in the forward-looking statements may not be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this Quarterly Report on Form 10-Q. While we believe that such information provides a reasonable basis for these statements, such information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements.

The forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements made in this Quarterly Report on Form 10-Q to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q or to reflect new information, actual results, revised expectations, or the occurrence of unanticipated events, except as required by law. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements.

Unless the context otherwise requires, references in this Quarterly Report on Form 10-Q to the “company,” “Personalis,” “we,” “us” and “our” refer to Personalis, Inc.

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PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

PERSONALIS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

(in thousands, except share and per share data)

 

		June 30, 2023				December 31, 2022
Assets
Current assets
Cash and cash equivalents		$	97,195			$	89,128
Short-term investments			40,012				78,530
Accounts receivable, net			10,132				16,642
Inventory and other deferred costs			8,140				8,591
Prepaid expenses and other current assets			5,476				6,808
Total current assets			160,955				199,699
Property and equipment, net			59,486				61,935
Operating lease right-of-use assets			24,660				26,480
Other long-term assets			3,937				4,586
Total assets		$	249,038			$	292,700
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable		$	8,847			$	12,854
Accrued and other current liabilities			16,408				19,013
Contract liabilities			3,337				1,264
Total current liabilities			28,592				33,131
Long-term operating lease liabilities			40,326				41,041
Other long-term liabilities			4,034				389
Total liabilities			72,952				74,561
Commitments and contingencies (Note 9)
Stockholders’ equity
Preferred stock, $0.0001 par value — 10,000,000 shares authorized; none issued			—				—
Common stock, $0.0001 par value — 200,000,000 shares authorized; 48,507,101 and 46,707,084 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively			5				5
Additional paid-in capital			589,418				579,456
Accumulated other comprehensive loss			(313	)			(912	)
Accumulated deficit			(413,024	)			(360,410	)
Total stockholders’ equity			176,086				218,139
Total liabilities and stockholders’ equity		$	249,038			$	292,700

 

See notes to condensed consolidated financial statements.

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PERSONALIS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(in thousands, except share and per share data)

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2023				2022				2023				2022
Revenue		$	16,699			$	18,240			$	35,559			$	33,467
Costs and expenses
Cost of revenue			11,907				13,959				26,037				24,908
Research and development			17,852				16,288				34,425				33,386
Selling, general and administrative			12,134				15,874				26,231				31,360
Restructuring and other charges			152				—				4,037				—
Total costs and expenses			42,045				46,121				90,730				89,654
Loss from operations			(25,346	)			(27,881	)			(55,171	)			(56,187	)
Interest income			1,465				349				2,718				493
Interest expense			(39	)			(50	)			(86	)			(109	)
Other income (expense), net			1				50				(25	)			69
Loss before income taxes			(23,919	)			(27,532	)			(52,564	)			(55,734	)
Provision for income taxes			36				14				50				21
Net loss		$	(23,955	)		$	(27,546	)		$	(52,614	)		$	(55,755	)
Net loss per share, basic and diluted		$	(0.50	)		$	(0.60	)		$	(1.11	)		$	(1.23	)
Weighted-average shares outstanding, basic and diluted			47,669,513				45,637,838				47,204,891				45,316,795

 

See notes to condensed consolidated financial statements.

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PERSONALIS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (unaudited)

(in thousands)

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2023				2022				2023				2022
Net loss		$	(23,955	)		$	(27,546	)		$	(52,614	)		$	(55,755	)
Other comprehensive income (loss), net of tax
Foreign currency translation adjustment			(37	)			(194	)			(9	)			(202	)
Change in unrealized gain (loss) on available-for-sale debt securities			179				(195	)			608				(896	)
Comprehensive loss		$	(23,813	)		$	(27,935	)		$	(52,015	)		$	(56,853	)

 

See notes to condensed consolidated financial statements.

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PERSONALIS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (unaudited)

For the Three Months Ended June 30, 2023 and 2022

(in thousands, except share data)

 

														Accumulated
										Additional				Other								Total
		Common Stock								Paid-In				Comprehensive				Accumulated				Stockholders'
		Shares				Amount				Capital				Income (Loss)				Deficit				Equity
Balance—March 31, 2023			46,774,490			$	5			$	583,151			$	(455	)		$	(389,069	)		$	193,632
Proceeds from sales of common stock under ATM facility, net of commissions			900,000				—				1,873				—				—				1,873
Proceeds from exercise of stock options			8				—				—				—				—				—
Proceeds from ESPP			468,643				—				909				—				—				909
Restricted stock units vested			363,960				—				—				—				—				—
Stock-based compensation			—				—				3,485				—				—				3,485
Foreign currency translation adjustment			—				—				—				(37	)			—				(37	)
Unrealized gain on available-for-sale debt securities			—				—				—				179				—				179
Net loss			—				—				—				—				(23,955	)			(23,955	)
Balance—June 30, 2023			48,507,101			$	5			$	589,418			$	(313	)		$	(413,024	)		$	176,086
Balance—March 31, 2022			45,250,087			$	5			$	562,889			$	(875	)		$	(275,304	)		$	286,715
Proceeds from exercise of stock options			195,839				—				463				—				—				463
Proceeds from ESPP			204,775				—				974				—				—				974
Restricted stock units vested			240,757				—				—				—				—				—
Stock-based compensation			—				—				4,415				—				—				4,415
Foreign currency translation adjustment			—				—				—				(194	)			—				(194	)
Unrealized loss on available-for-sale debt securities			—				—				—				(195	)			—				(195	)
Net loss			—				—				—				—				(27,546	)			(27,546	)
Balance—June 30, 2022			45,891,458			$	5			$	568,741			$	(1,264	)		$	(302,850	)		$	264,632

 

See notes to condensed consolidated financial statements.

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PERSONALIS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (unaudited)

For the Six Months Ended June 30, 2023 and 2022

(in thousands, except share data)

 

														Accumulated
										Additional				Other								Total
		Common Stock								Paid-In				Comprehensive				Accumulated				Stockholders'
		Shares				Amount				Capital				Income (Loss)				Deficit				Equity
Balance—December 31, 2022			46,707,084			$	5			$	579,456			$	(912	)		$	(360,410	)		$	218,139
Proceeds from sales of common stock under ATM facility, net of commissions			900,000				—				1,873				—				—				1,873
Proceeds from exercise of stock options			8				—				—				—				—				—
Proceeds from ESPP			468,643				—				909				—				—				909
Restricted stock units vested			431,366				—				—				—				—				—
Stock-based compensation			—				—				7,180				—				—				7,180
Foreign currency translation adjustment			—				—				—				(9	)			—				(9	)
Unrealized gain on available-for-sale debt securities			—				—				—				608				—				608
Net loss			—				—				—				—				(52,614	)			(52,614	)
Balance—June 30, 2023			48,507,101			$	5			$	589,418			$	(313	)		$	(413,024	)		$	176,086
Balance—December 31, 2021			44,904,512			$	4			$	557,558			$	(166	)		$	(247,095	)		$	310,301
Proceeds from exercise of stock options			475,044				1				978				—				—				979
Proceeds from ESPP			204,775				—