Q3 2020 Berkeley Lights Inc Earnings Call
[music].
Ladies and gentlemen, thank you for standing by and welcome to the Berkeley Light third quarter 2020 earnings Conference call. At this time, all participants are in a listen only mode.
After the speaker's presentation, there will be a question and answer session.
I ask a question during the session you would need to press star one on your telephone if.
If you require.
You put her assistance please press star zero.
I would now like to hand, the conference over to your first speaker today to carry Mandeville Investor Relations. Thank you. Please go ahead.
Thank you.
Joining me today from Berkeley Light, it's Eric Hahn, Chief Executive Officer, and Sean Hall, Chief Financial Officer.
Earlier today, partly lights released financial results for the quarter ended September Thirtyth 2020.
If you've not received this news release or if youd like to be added to the company's distribution list. Please send an email to IR at Berkeley like.
Like dotcom.
Before we begin I'd like to remind you that management will make statements. During this call that are forward looking statements then the meaning of federal securities laws. These.
These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated.
Additional information regarding these risks and uncertainties.
Keith appears in the section entitled forward looking statements in the press release, Berkeley life issued today for a more complete listening description. Please see the risk factor section of the company's final prospectus filed with the SEC on July 17, 2020, the company's quarterly report on form 10-Q for the quarter ended July Thirtyth 2020, and.
Other filings with the Securities and Exchange Commission.
Except as required by law, frankly, like disclaims any intention or obligation to update or revise any financial projections or forward looking statements, whether because of new information future events or otherwise.
This conference call contains time sensitive information and is accurate only as of the life.
Broadcast November 12, 2020 with that I'd like to turn the call over to our comps Berkeley like Chief Executive Officer, Eric.
Thanks, Gary and thank you everyone for joining us this afternoon I'm.
Very pleased to welcome you to bring the lights first earnings call to review our results for the third quarter of 2020.
I'd like to start to.
Today's call by thanking the amazing team, we have over two lights as many of you know we completed our initial public offering in July raising approximately $188 million in net proceeds.
This achievement is a testament to our team's collective dedication and passion.
Of course, I would also like to thank our founders we go account gross billed David.
Well in the world for their vision.
And finally, I would like to thank our longstanding investors for their continued support and welcome all new investors.
On today's call I will start with a brief overview of Berkeley lights for those who are new to the company.
Next I will provide an overview of our progress during the third quarter, including some new work flow products, we released.
I'll then close with some thoughts on how we are approaching the future and where we are investing before turning call over to Sean for more detailed look at the financials.
Starting with our top line performance revenue for the third quarter totaled $18.2 million up $7.6 million or 72% for the second quarter 2002.
And up 16% year over year.
Now before we dive deeper into specifics on the quarter I'd like to remind you of our vision here at Berkeley lights.
We are a leading digital cell biology company focused on accelerating the rapid development and commercialization of bio therapeutics and other cell based products.
We envision a future.
Venue, where sales are scalable and sustainable way to manufacture products that we need to deliver long and healthy life.
The Berkeley lights platform is key to enabling EPS and our goal is to become the industry standard across a cell based product value chain.
The markets that could be addressed by cell based products are varied and huge.
Particularly in pharma, new and sustainable foods, agriculture, and industrial materials.
We are initially focusing on three markets antibody therapeutics cell therapy and synthetic biology.
Collectively these markets accounted for end market sales estimated to market sales estimated to be 140 billion.
$1 in 2019, which are projected to grow to over $255 billion in the next four years, representing an estimated initial addressable market opportunity of $23 billion for Berkeley lights.
But there are some big challenges, making cell based products, namely our customers must understand and assess how cells per for.
And behave.
In other words, they have to functionally characterize many single cells to find the best itself not make the products they need for displays a function that they desire.
Understanding the genomics of single cells is important but it does not provide function and without function. There is no product.
Finding the best sells for.
Foreigners analyzing the functions of single cells at scale, that's what we do we find and deliver the best cells that our business.
To find those vessels built devices created what we believe is the most advanced environment for functional testing of lives single cells now.
Next we capture and interpret the qualitative language of biology and the Retrans.
Quite that into digital information.
This is the information used to select the best cells. This is what we call digital cell biology.
Now nature has demonstrated that sells are both a scalable and sustainable way to develop and manufacture the products we need.
Although these cells are capable they are also quite complex.
And it's due to this complexity that we're just at the beginning of harnessing the capability of cells to produce these products.
At this relatively early stage of commercialization, we have built an impressive customer list that includes industry leaders, including eight of the top 10 largest biopharmaceutical companies in the world as ranked by 2019 revenue.
Our.
Our fully integrated end to end solution is comprised of advanced automation equipment.
Our opto select chip technology, which allows our customers to isolate single cells.
Our proprietary assay reagents to perform these tests.
And our advanced integration automation software that includes our operating software and our advanced analytics software.
Our platform enables customers to perform standardized and automated workflows with precise control over the environment, which enables functional testing of tens of thousands of lives the upsells in parallel.
We also have the ability to link the cell phenotype to the transcriptome, thereby creating what we believe to be the largest day acute for single cells in the industry.
This data helps our customers select the best cells.
Customers can gain access to our platform by buying or subscribing to an advanced automation system.
Circulates is the only company commercializing a platform that can do this in a scalable way.
Our platform enables several key benefits for our customers.
First we increased our probability of success for making cell based products by functionally characterizing highly bio diverse cell samples.
Second because our workflows are an early in the value chain. We believe we are the fastest path to value and revenue potentially extending our customer cell based product my time on the market prior to any high.
In exploration and increasing the return on investment.
Third we are an enabler.
Our platforms do things that are very hard to do otherwise such as multi plex single cell functional assay that scale.
Capturing rich data from pressure cell samples.
Thanks, three lives cells or clinical cell lines and link.
Linking phenotype and genotype.
And fourth we offer the fastest path to significant capacity with replicable distributor ability.
Meaning we are able to qualify workflows in California, then distribute these workflows globally and execute these workflows into repeatable fashion in any suitable out on the globe.
For customers that already have a platform to clinic can be as rapid as a software update for.
For customers a lack of platform, we can deliver a platform and execute workflows and just days after install.
And for customers that have multiple platforms across multiple sites globally. They can be assured that the same workloads being executed at all sites.
Turning to our markets, we see two key tailwinds driving growth in our addressable markets first.
First at the macro level, there is an increasing demand for cell based products.
For these products wherever there is a gene added or a desired immune response functional validation is required.
Functional validation is at the core of our.
<unk> offering.
The growing requirement to drive design build test learn cycles directly drives an increase in the number of workloads to discover develop and manufacturer cell based products.
And second we are also seeing increasing complexity of the cell based products today pharma companies.
Our working to discover antibodies against her to hit targets or other complex therapeutic modalities, including by try a multi specifics for cell based therapies.
The cell characterization is getting more complex as hard hit targets require more precise ashley's at higher resolution.
With a growing product.
Products the manufacturing complexity is also increasing this.
This means workflows are executed at a higher frequency, thereby further increasing the demand for our products.
As this demand for functional validation grows our customers are looking to accelerate their capability to develop and discover cell based products and we are delivering.
Additionally, the growing complexity from making cell based products is being addressed in a scalable way by the existing and growing capabilities of the Berkeley lights platform.
Parameter optimization, which is required to identify and deliver the desired biology requires trade offs among the many functions being analyzed and optimize to the discovery and development process.
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The required data to achieve this organization can be provided from the Berkeley lights workflows.
Now looking more closely at the third quarter, we placed eight platforms and customers, which was up from four platforms placed in the second quarter.
We saw an increase in recurring revenues, which were up 26% from last quarter.
And up 92% year over year.
Growth over the prior quarter was seen across all geographical regions with Asia, leading new platform placements, followed by Europe, and the United States.
Revenue was driven by strong demand for the discovery and development of cell based products, especially for antibody therapeutic workflows.
We continue to see capacity expansion in the industry led by strong investment activity in the CRL CDMO space.
In addition, the trend of increasing functional single cell characterization continues to gain momentum.
Which is a key driver in our long term growth strategy and core to our mission at Berkeley lengths.
During the third quarter, we placed 50% of our beacons ATSI arrows and TD, most giving evidence to the global capacity expansion in our served markets and providing startups and smaller biotechs access to our technology.
We were also excited to release auto cell line development 2.0.
This new workflow enables higher through.
Throughput.
Provides assays for complex protein such as multi specifics.
And acceleration of our customers path to production cell lines. This.
This was a timely response to the growing capacity needs of our cell line development customers, resulting in a placement three platforms in the third quarter of 2020.
We also saw an increase in our.
The around T cell characterization with the release of several application notes to support our growing set of capabilities. In this segment, resulting in the placement of three platforms in a cell therapy segment during the quarter.
In addition to our progress and antibody therapeutics and cell therapy markets.
We were also making great progress developing the multiples.
Workflows in the synthetic biology market through our long term partnership with Kiko Bioworks.
In summary, the markets for cell based products and activities to develop them are growing the increasing complexity of cell based products, especially in biotherapeutics is driving further demand for functional validation.
Hi.
Secondly, a precision and automation.
Millions of gene edits drive countless design build test learn integrations annually all of which require single cell functional test.
Overall this has been a very eventful quarter at Berkeley lights, I'm very proud of the progress. Our team has made and I am confident that we are well positioned to exit.
Execute on our strategy going forward with that I will now turn the call over to Sean for more detail on our financials Sean.
Thanks, Eric total.
Total revenue for the third quarter of 2020 was $18.2 million with $14.1 million in product revenue and $4.1 million and service revenue.
Total revenue was up $7.6 million or 72% from the second quarter of 2020 and up 16% year over year.
Looking at our three revenue streams direct platform sales were $12.4 million in the quarter, increasing $4.9 million or 65% from the second quarter of 2020.
And were in line with the prior year period.
We placed eight new platforms during the third quarter of 2020.
Recurring revenue was $3.7 million or 20% of total revenues during the third quarter of 2020. This.
This represents an increase of $700000 or 26% over the prior quarter and an IND.
Recent $1.8 million or 92% over the prior year period.
During the third quarter. In addition to the new platform placements Wi Fi resumption in campaign activity at certain customers over the prior quarter when some activities were caused.
The year over year increase can be attributed to the growth of our installed base.
Revenue from joint development agreements and partnerships during the third quarter was $2.1 million up $2 million from the second quarter and $600000 or 43% over the prior year period.
The sequential increase was primarily due to prior quarter revenue reductions related to a headstart payment, we made to gingko and August.
Also due to our gingko program resuming at full capacity during the third quarter.
Gross profit for the third quarter of 2020 was $12.8 million compared to a gross profit of $7 million in the second quarter of 2020 and $11.7 million in the same period of the prior year.
Gross margin in the third core.
Quarter was 70% as compared to 66% in the second quarter and 74% during the third quarter of 2019.
The sequential increase in gross margin was primarily driven by the previously mentioned gingko by down in the second quarter.
The margin decline year over year was driven by the substantial completion of legacy milestone for.
Programs, which carried a higher gross margin in the prior year.
Total operating expenses for the third quarter of 2020 were $21 million, a 32% increase from $15.9 million in the third quarter of 2019.
The increase was primarily attributable to an increase in head count related stock based compensation.
As well as other expenses to support our continued growth and build out of the infrastructure needed to operate as a public company.
R&D expenses for the third quarter of 2020 were $10.4 million compared to $10.2 million in the third quarter 2019.
Sales and marketing expenses for the third quarter of 2020 or 3.3.
Million dollars compared to $2.6 million in the third quarter of 2019.
And general administrative expenses for the third quarter were $7.2 million compared to $3.1 million in the third quarter of 2019.
And finally net loss in the third quarter of 2020 was $8.6 million.
[music].
We ended the third quarter of 2020 with approximately $237 million in cash and cash equivalents. This.
This includes net proceeds of approximately $188 million from our IPO in July 2020, net of underwriting discounts commissions and other offering expenses.
While we have not observed any recent negative changes in.
This is climate uncertainty remains related to the pandemic as.
As a result of this uncertainty we're not issuing any formal guidance at this time.
With that I would like to turn the call back over to Eric for closing comments.
Thank you Sean we're living in a fascinating time, where biology technology and information Sciences have a ball.
All to a point, where we can add it sells at an unprecedented rate.
Today, we can rapidly cequent cells and capture the programs that controls like we have the data and information infrastructure to process. The large amounts of data that are being created.
And through advances in gene editing, we can edit cells with high levels of specificity to insert new instructions.
Our bank to the sales program in an attempt to change the function of itself.
So because sales expressed in knowledge information in a variety of ways that we can accurately predict we have little certainty that our efforts will result in the ocean we intend.
The constraints that our customers face today is that they have to functionally test large numbers of single cells at scale to find those single celled.
That have the function they need to make the products they desire.
But a big lights, we're solving that problem by increasing our understanding of the behaviors of cells. So that we can improve and accelerate the design build test learn process as we move into the future.
Furthermore, because we offer standardize workflows the same workload can be executed at multiple sites.
It's around the globe.
And because the data was created with the same workflow the data can be a mask and a large cloud based storage system.
When this data is combined with machine learning and artificial intelligence, we will have the best chance in the history of programming yourselves to do what we want to do.
This is the power of distributed biological processing. This is the power of.
Hi, Doodle cell biology. This is the power of the Virtualized platform.
We believe there is a great teacher and digital cell biology, and we're just in the beginning with that we'll now open it up to questions operator.
Thank you Sir.
As a reminder to ask a question human nature Press Star one on your telephone.
Which are your question press the pound key.
Please stand by while we compile documentary roster.
I sure. Our first question comes from the line of tied to Peterson from JP Morgan. Please go ahead.
Hey, Good afternoon, Eric you mentioned in the press release self therapy drove about a third of the placements in the quarter can you just talk a little bit more about.
Traction in that market and how you think about it going forward.
Yeah, we believe there's a significant opportunity.
Well or two and our customers to enable the babies attracting o'deli across movies, we do believe we drove to Goldman Sachs.
Third as repeatable and efficient way we.
We do in <unk>.
And our integrated cell therapy development and manufacturing platform with embedded quality control.
To control the functional this product placement process from incoming materials, probably providing a truly digital record there.
Therapeutics manufacturer.
And as we're meeting investors right now the discussions are ongoing how do we how do you see.
Due to the need.
And then on marketing so liberal ideas with.
In itself.
Through 2020.
Great and then you know thinking a little bit about just the portfolio a couple of questions. I'm wondering if you could comment on lightning, how you're feeling about the rollout and any thoughts about.
Whether you could start to penetrate the academic market there.
Yes, certainly for those for those who are new to present on the call lightings or lower capacity left on immediately to access for customers access our technology and really the key take into that until the ramp and why isn't his or her you know somebody needs work for is that we have on the system.
Our aim to meet the needs of these poor application, though it's a cool it would kind of like you know some workovers then our customers do lenders in lighting in this sector to be a T cell characterization space and.
And so we'll continue to focus on writing placements into that segment to build a beach and it is getting the secular demand.
Excellent care physician functional therapies.
And then what's the interest on the subscription uptake for Beacon.
And are you looking to kind of pushed out a little bit more aggressively given where we are endemic.
Yes, it's a great question, so I'm going to I'll hand, this over to Sean So John can talk about the subscription.
John.
Yeah, I think that Hey, Hey, tiago. Thanks for the questions I think yes.
Yeah, the way to think about subscription it's really just one way our customers can access our technology right and.
And you know the benefits here to our customers are obviously more tailored access to capacity more predictable and stable stable budgets and spend patterns.
And and a lower entry fee for for access I think it's important to remember here subscription for our type of product offering today Israel.
Is relatively new in the market right. So it will have a certain adoption cycle that that carries with it yeah.
Yeah, as we engage with customers, we continue to evolve the subscription product offering.
I think the answer is you know we're still at the early stages of this but we you know we we continue to believe this model offers compelling advantages to to our customers right, but I think it will take a little bit more time together more meeting for statistics here, but we we do see the pipeline developing and we continue to push this offering.
And we'll continue to update as we on these calls as we go forward.
Okay, and then before I hop off Sean I know you don't want to give quarterly guidance, but is there anything your view that has changed materially since the IPO as you think about kind of the set up for for the rest of this year.
Yeah, I think that's great question, you know as we said I think in our.
Prepared remarks as well.
Just given the uncertainty that that's out there we're not really commenting today on 2020.
Full year guidance, but what I can say, though.
To that point is it really has been no changes in our view of the business since we spoke during the IPO.
Perfect. Thanks, again ticket sure thing.
Yes.
Thank you.
Your next question comes from the line of Tejas Savant from Morgan Stanley. Please go ahead.
Hey, guys good evening.
So just to follow up on an on Tychos question that sort of on a forward looking.
Commentary here.
Can you.
Tell us a little bit about just the momentum in the order book as well as on the consumables exiting the second quarter as well as in October and then are you seeing any impact at all around your ability to install a service your customers.
Following the pickup in infections are related shutdown.
It's or not really.
Hi, David Hi, Eric here good to talk to you again, you know in the market. We continue to see two key tailwinds that are going in there.
To answer the first part of your question right.
Those main tailwinds, including increasing demand for these products and also an increase.
Down complicity of just don't based products and we have to then be being addressing the pool and even a faster.
So you would think capacity expansion.
Provides the functional assessment, which our customers need to find themselves to make it a pump like some of these products. So we feel like ours is doing really well positioned there on the first part of your question.
In the third the coated in infections. They take the global shutdowns experienced in the first 2020 impacted many businesses, including owners and although we can't predict the future of this and then they can how governments are going to.
Right.
I've seen that our industry has shown in addition degree of resilient.
We haven't seen any cancellations.
But we have seen that uncertainty cannibalistic the timing between quarters.
So what we've done is we have to take.
Taking the steps fiercely please say assuming your customers how they can reduce the number of people in their lives using our advanced automation platform. So they can see continued to lose their therapeutic pipeline store, it's a benefit to our customers.
Additionally to burn ourselves against the uranium issues with installations and training we've hired additional resources in regions to minimize that risk.
We also told us and what we call breaking mortgage universe, which is our online learning platform, which we can expand our customers and also as we scale, our new stack that we can do that anywhere in.
[music].
Sure did you want to make any comments on your right to protect against the coated the coated down to if there was any cobot issues and the ongoing quarters.
Yeah Sure just reminder, yeah.
Hey, Josh as we exited Q2.
We updated our revenue recognition policy.
Two.
Enable revenue recognition on either shipped in our delivery depending on the nature of the.
The deals on the terms.
So thats that help then in terms of the issue around Colgate and preventing us from actually installing and training Thats also actually a benefit for our customers as well it's not out there.
Being forced to install our train we were really doing that on our customers' timeline. So it's actually a benefit to our customers as well.
Got it.
That's helpful. Sean just following up on that was that.
Delta between orders and and units I mean on which you recognize revenue in the third quarter some of yours.
Sort of some of the platform plays in the life Sciences space have spoken about that dynamic where there was a pretty meaningful delta here between the orders being placed and obviously.
Ben sorry, or potentially the delivery. So maybe you can shed some color on that.
John Your question it.
Sorry.
Oh go ahead John.
Yes, yes, tradeoffs great Great question, I think here our businesses really a turns business right I mean.
With that we actually see rapid order fulfillment as a as a sort of competitive advantage of ours and I think from that perspective backlog for us is really just a function of.
Orders placed.
Last days of the given quarter like like you just talked about and therefore, it's it's subject to some fluctuation.
Fluctuation.
We talked about our revenue recognition policy, helping in that regard.
But you know, we're really a turns business and that dynamic we see is going to continue and and backlog as such we'll we'll flux.
Got it that's helpful and.
And then Eric.
In the past you've spoken about give us I want your Asian customers leapfrogging to your platform versus some of the legacy approaches.
Is that essentially a dynamic that do you see sort of saab sustaining through sort of the next.
A couple of years.
Sure as those customers sort of directly upgrade to the beacon and is that what is essentially at driving the strength in placements you saw in the third quarter here.
So we continue to see very strong demand in Asia Pacific region.
For for antibody discovery, and so we do see that our customers artist.
I did not to install some of these legacy platforms I do anticipate that that will continue to grow in that region for the next several quarters I'm not sure. It's not clear to me that that will go on for years, but certainly into the future.
Got it that's helpful.
And then.
Final one for me.
Yes, I mean in terms of just Joe commercial expansion plans can you just give us a quick update on where things stand today and how much work that has to be done on that front heading into 2021.
And I know you sort of focusing on specific deals I mean, perhaps given the strength you're seeing in Asia, just sort of saw.
Stop.
Any help at a quicker cadence over there.
Yeah, I mean over the past quarter and earlier this year, we've made some really nice adds to our commercial organization in particular in the sales on the sales team. We brought a mark this is key to lead our global sales, who who has.
Can you to expand our efforts with you a gong in Asia Pacific.
So we now have a our wholly four and own enterprise is now up and running in the Asia Pacific region. Additionally, we just brought on Gareth Jones, who is who will lead our our European region. So we continue to make investments we have more work to do there, but but really really strong progress in that space.
Additionally.
We've made we've made some pretty big changes to our business development organization to continue to bolster that activity as we move forward, which is which is critical as it sits at the tip of the spear.
And in any case, Sean do you have any additional items you want to add to your kind of investments, we're making in the commercial organization. Yeah I was just yeah.
Yeah definitely I was just going to say this is going to be.
Continuing theme to adjust as we go into 2021 and expanding the sales force globally like Eric just mentioned supportive.
Supporting our key markets some of these products.
Particularly in Europe, and in Asia, which is which we've seen is our higher higher growing region here.
Dovetailing on that on the spend and.
And looking forward into 2021, I mean, we're going to continue to invest in BD as well to drive adoption.
Of new products and existing capabilities in new markets through the type of partnership joint development deals that we've talked about in the past and.
Also on top of that we expect a bigger ramp in R&D right.
Supporting the business development in the new deals, they're going to bring to the table, but also our new product development efforts and new market penetration next year.
Got it thanks, so much for the time this evening guys.
Thanks for the questions to just Yep Yep.
Thank you. Our next question comes from the line of Doug Schenkel.
From Cowen. Please go ahead.
Hey, good afternoon guys.
Thanks for taking my question sorry, if you covered any of this that the phone quality kind of went in and out for a little while they're just it hasnt purpose perfectly at least for me. So I do apologize in advance if I'm. If you covered any of what I'm about to ask just tell me in.
And we can move to the next one if that is the case. So just just starting on placements.
Looks like placements roughly doubled sequentially.
Sequentially relative to Q2 could you could you just break down.
More detail subs.
Subscriptions versus direct and I know you've got the question on backlog heading into year.
And I am just wondering if the Q3 placement number was at all a function of catching up from earlier parts of the year when maybe it was harder for customers to accept capital in the midst of the pandemic or.
If you think this is a normalized number.
Yes so.
Hey, Doug I, certainly believe that we are in a normalized in the normalized condition and in the quarter. We placed the Iot platforms in three replaced into cell line development to a place in the cell line into antibody discovery and three in the cell therapy and regionally that looks like we placed three into Asia.
Today, three into Europe and into into the United States.
In regard to subscription breakdown I'll I'll hand that off to Sean, but I do think we see returning back to kind of a normal style of business.
As as the World is coming back online John anything to add.
No I think you hit it.
Because I know the other key topics there.
And did I Miss the subscription versus direct mix sorry, if you gave that in your prepared remarks, or if I just missed that earlier.
No thats it thanks.
The placements in Q3, while direct sales.
All direct sales okay.
And then.
Yes, just I think I know the answer to this based on just what you guys. Just described but you know.
I kind of felt like pharma was already holding up pretty well for you as your key end market through the first couple of quarters of the year in the midst of the pandemic, which.
Yes, I think we all appreciate was pretty impressive given.
We saw from some others in the space in terms of capital equipment demand.
It heading into year end would you say things are thawing and you feel like you have some momentum given you just described this.
This kind of being a normalized Q3, and I would suspect Q4 potentially could be better just given tip.
Local.
Year end budget flush or.
Yes, we continue to see that capacity expansion happening in the market and there is a there is a focus and Adam.
Foods antibody discovery and cell line development.
And we are operationally, we've organized ourselves to be able to rapidly respond to our customers request to provide.
That fastest path to capacity expansion possible and.
And so you know.
Again due to the cold wave, we havent seen cancellations, we have things seem things move in and out it and we've also seen that our customers are able to continue to accelerate and move their pipelines forward using our advanced automation systems. So I do believe we are we are we are moving.
Back towards into a normalized kind of business cycle.
Okay and then.
Kind of asking the same question, but just flipping from capital over to consumables.
With a few logical leaves it seems like consumable revenue per box seem to increase by about 35% to 40% relative to Q2.
But again those are our numbers not yours, but I'm guessing we're in the right neighborhood of course, just correct me if we're not but again is that just a normalized run rate or do you think there was some catch up our inventory builds given what's going on in the world just or is this as you guys have answered a couple of times already this is just the norm.
No theres definitely.
There's definitely a considerable increase and so I'll, let sean speak to the exact numbers, Doug I'll, let Sean check them half there.
But we did see we did see increasing and we believe we saw increasing utilization associated with our customers coming back online in in the quarter and so and so I think we're like I said.
We are ramping back up to the normal or standard business environment.
[music].
Yes, Doug and just to just to just to add to that we did see a bit of the pull through.
In Q through come from some late late in the quarter Q2 order flow but.
But the majority.
Of the recurring revenue.
Growth was due to the to the increase in the installed base.
Okay.
Last one for me in your prepared remarks, you referenced the collaboration with Gingko.
At what point do you think that those send bio applications that you're enjoying.
Development with might be available more broadly for other commercial customers, if I remember correctly going back to Q2.
There was a.
Revenue impact associated with you essentially I think putting yourself in a position where you could accelerate those timelines I'm just wondering if there is any update on that.
Yes.
The only I mean, the opportunities and Symbio, Doug we've spoken before radar substantial rent, but they also required clear market segmentation and and in Q3, we release, a pretty compelling data in the advancement of the were of those workloads into in the space.
Well first we showed that the measurements made the nano pans correlated up to half leader Fermenters. This.
This was data that we published at the scene biodata comp guidance.
And as everybody is aware of this market scale up has been a big challenge in that stage and this capability. It would help our customers lock in their production economics early in the process.
Second we show that we can perform enzyme kinetic measurements in the Nanopass is the.
The significance here is that you know.
Is that we are moving to measurements that are high.
Sure inside of the cell to help our customers accelerate not only enzyme engineering, but the manufacturer of the proteins that that those enzymes can create inside of the cells and so these two capabilities as you understand our broadly applicable not only in bio, but particularly are back into our bio pharma market.
So our strategy in this market continues to be.
Moving to segment segment, the market and focus on on high value added products and or.
Other applications, which drive high frequency gene editing validation via the design build test learn iterations cycle driving high consumable consumption and so as we continue to make great progress on office and Symbio discovery.
When you work flow and Symbio development at one point and workflow.
We're going to plan to and those are our plan is to announce other than 2021.
Okay. That's great. Thank you guys really appreciate all the detail on all those questions.
Great. Thanks.
Thank.
Yes.
Your next question comes from the line of Brian Weinstein from William Blair. Please go ahead.
Hey, guys. Thanks for taking the questions.
Just to go back to a comment on business development team that you guys added in the quarter can you give us a little bit more about what the team looks like now but more broadly can you.
You talked about.
Actually kind of relationships partnerships JV opportunities, both inside and outside of the traditional markets that you're in and what we can expect from the organization and sort of the pace of.
These opportunities coming through and how you're thinking about these things as you evaluate them.
Yes, Hey, Ron It was clearly.
Sure. It was clear to us that there are opportunities beyond the scope of our current market segments and to make sure that we can access those opportunities. We made some significant changes to our business development organization.
Right and the goal and making these changes was to enable new and existing customers access to some of the new emerging BRIC nights capabilities and.
And we.
We realize that to do that we needed to create a best in class BD organization, which we have we have now done.
So the team that we've assembled is making great progress on developing those high value partnerships that you referenced.
Which will enable brick lights to develop in concert with a great market leading partners.
Enable new.
Cleo abilities to current and future customers in existing and adjacent markets. So I'm really excited about the potential of the team things are moving forward in that integrate direction and hope to be able to report out on some of that activity within the next several earnings earnings calls.
Great. Thanks for that and then.
I'm a funnel into use that term here as we think about.
The.
Willingness and opportunity that you have with with your customers. How do you see that funnel build right now and the visibility that you have how would you characterize that is a corollary to that what do you expect to see as far as the sales cycle across.
Send markets is there an opportunity for that to accelerate.
In regards to the immigrants the funnel right. We continue pretty likes continues to try to art.
Highest probability of success gave to their products and were operating these and these very large markets in antibody therapeutics in bio and cell therapy and as.
As I mentioned previously we do see those two and increasing demand for cell based products and increasing complexity of those cell based products and because we address both of those being the fastest path to capacity expansion and also providing the functional assessment. They need we continue to see things things built in the way that is in line with our expectations for the business.
Okay. Thanks, guys.
Thanks, a lot thanks Ron.
Thank you and I show our last question comes from the line of Paul Knight from Keybanc Capital markets. Please go ahead.
Hi, guys, Mike on for Paul Thanks for taking my questions.
Hey, Mike welcome.
Mm.
Prepared remarks, you mentioned about.
He presented beacons on place with CR Rosen Cmos can you provide some more color around the strength.
In that end market and then you made and then do you think this kind of provides another avenue to expand awareness to some of the maybe your smaller biopharma biotech customers. Thanks.
Yes, Paul that that is that's spot on I mean, there are large majority.
Often.
We have the new bio pharmaceuticals that are coming out right or are really created by these smaller biotechs and startups and so.
Enabling zeros.
Crs with access to our technology enabled access to these to the smaller the smaller end season, and we believe that.
It is in line with the with the Euro markets.
<unk> business model to bring up that capacity rapidly and so.
The higher levels of demand for cell based products that were seeing an increasing complexity really falls in line with their need to bring on this capacity as a function of time.
Great. Thanks, and then.
And my last one is just regarding where you guys are investing for growth.
Typically around the.
Your proprietary workflow offerings on kind of whats the cadence there and how is the trend with some of the workflows that you've added with customers.
Yes, so since since.
Since we.
Because we started we have released seven cars, we have seven commercialize workflows and so that first portfolio lease was in late 2016 or early 2017 that was our cell line development work flow and we released our antibody discovery work flow. The first of our antibody discovery were closed in mid 2018, and we released five workflows. So far this year.
And the wonderful thing about our platform based technology is that you can reuse the components of these workflows to create new workflows solutions in either within a market or in an adjacent market.
And we continue to release workflows, and we do see uptake the the cell line development work or sorry self therapy development one.
No word for which we really started earlier this year is really at the Nexus for kind of the activity in cell therapy that we saw in Q3. So we continue to see a higher cadence release of workflows.
As we move forward into the future.
Great. Thanks, guys.
Thanks, Mike.
Thank you.
This concludes our Q and a session and today's conference call, ladies and gentlemen, Thank you for attending you.
You may all disconnect everyone have a good day.
Thanks Dylan.
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