Q1 2021 908 Devices Inc. Earnings Call
[music].
Ladies and gentlemen, and thank you for standing by and welcome to the 908 devices first quarter 2021 financial results Conference call. At this time all participants are in a listen only mode. After the speaker presentation there'll be a question and answer session to ask a question. During the session you will need to press star one on your telephone.
Please be advised that today's conference maybe recorded if you require any further assistance. Please press star zero and I would now like to hand, the conference over to your speaker today, Carrie Mendivil Investor Relations. Please go ahead.
Thank you.
This morning, and await the basic released financial results for the quarter ended March 31 2021.
You have not received this news release or if you'd like to be added to the Companys distribution list. Please send an email to IR at nine and weight devices Dot com.
And me today from nine away and Kevin Nash, Chief Executive Officer, and co founder and Joe Griffith Chief Financial Officer.
Yeah.
Before we begin I'd like to remind you that management will make statements. During this call that are forward looking statements within the meaning of federal securities laws.
These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated.
This will information regarding these risks and uncertainties appears in the section entitled forward looking statements and the press release issued today.
For a more complete list and description. Please see the risk factors section of the company's annual report on form 10-K for the year ended December 31, 2020, and and its other filings with the Securities and Exchange Commission.
Except as required by law, and I know way 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 live broadcast may 13th 2021.
That I would like to turn the call over to Kevin.
Thanks, Carrie good.
And thank you for joining our first quarter 2021 earnings call. We started the year strong with the first quarter revenue growing 39% to $5 5 million and we placed 66 devices during the quarter, bringing our installed base to over 1400 devices across our three products. This is double the number of devices placed compared to the first quarter of <unk>.
20.
Over the course of the quarter, our team continued to execute and made outstanding progress towards our vision of democratizing mass spec by breaking it out of the confines of the central lab and bringing its power to the point of need.
To continue this momentum throughout 2021, we're executing to drive expansion across our sales channel customers and platform and.
And since we last updated you at the end of March we've continued to make incredible progress across all three of these dimensions of our business.
Starting with our sales channels and commercial team we ended the quarter with 41 sales marketing and product management employees, adding 11 employees over the course of just the first quarter.
And I'm really pleased by the incredible talent, we're attracting to nine away, we're continuing to track toward our goal of reaching 60 employees by Q1, and 2020 to doubling the number of sales and marketing employees from the third quarter of 2020.
To further support growth across our entire organization, we're excited to announce Michel Fournier as our new VP Chief people Officer, who joined our team and mid April prior to coming on board at nine and weight Michel and most recently served as the Chief Human Resource Officer at Park Shell International a large clinical research.
Organization, she brings a wealth of global experience and attracting and retaining top talent and will be instrumental as we ramp up our commercial organization.
Moving onto customer traction and we continued to see strong adoption from both new and existing customers across our product portfolio, we focus on leveraging our customer success and testing trials and pilots into enterprise wide standardization for both devices and consumables, we are particularly encouraged.
The adoption of our products by industry, leading customers, whose influence will be critical as we grow across the sector.
Specifically with our handheld such adoption helps progress our efforts to have our devices become the standard bearer and go to tool for all responders, especially those combatting the opioid crisis, we're pleased to announce that the United States Department of state purchased multiple Nx nine and eight devices during the first quarter.
Date Department partners with countries worldwide sharing best practices and building capacity to identify and exploit vulnerabilities at each level the international drug supply chain.
The Nx nine awake devices will be used with these global partner countries to detect and identify a range of suspected narcotics and illegal drug substances and other key handheld customer that purchased during the first quarter was the LSU National Center for Biomedical research and training, which is a nationally recognized organization that provides thousands of trainings each year.
To the emergency response community throughout the United States and across the Globe. This partnership is a great step and our efforts to have our handheld mass spec become industry standard of safety response and.
And April we were proud to announce that the U S border patrol has adopted more than 60 M X nine and weight in 2020 to standardize its trace detection at 20 field locations across U S borders.
And encouraged by the value, we're adding to our customers and are honored to be partner with these premier organizations.
Turning now to our desktops, we deepened traction within Biopharma with multiple rebel devices placed with existing customers to date, approximately 40% of our total installed base across top 20 biopharma companies during the quarter, we on boarded and several new customers that will use rebel for cell and gene therapy applications.
Locations other key players, including Bristol Myers Squibb already leveraging rebel for this use BMS is currently using rebel devices across their domestic and global operations, including and their car T cell therapy process engineering and technology development Bob.
And finally moving to expansion of our platform as we shared on our last earnings call. We are continuing to expand our platform's capability to increase the areas of use for our customers and continue to open up our addressable market over the next 12 to 18 months you should expect to see a continued cadence of new capabilities to enhance our devices.
To further support our customers' needs.
And will include analyte panel expansions, new software applications and additional assay kits accessory modules third party hardware and software integration and other scientific demonstrations of the ultimate reach of our platform.
To that and we recently announced significant updates to our <unk> nine and weight handheld device. These enhancements include and aerosol module accessory to detect and identify Ursula and chemical hazards.
Added targets, allowing for responders to identify additional priority drug substances, and a bluetooth capability, which enables seamless sharing of important information facilitates data transfer and accelerate support in the field.
And these added capabilities are aimed to address gaps and the responders workflows increased engagement and drive utilization.
With this update the onboard machine learning algorithms can now detect and identify cat the loans and cannabinoids and the United States Drug enforcement administration and annual report the agency reported synthetic cannabinoids and cap. The loans are the most commonly abused drug substances in the United States and the number of new class.
And variances of these substances is constantly growing these additions to the MSA to wait and like capabilities, our pivotal for responders and our local communities.
We're also continuing to develop and release updates and new capabilities for our desktop devices, specifically for our rebel product, we're enabling new software and data integrations with third parties, which include process data management and multivariate data software rebel provides a wealth of new data to our customers and we are committed to making it easier and easier for.
And then to mine it and garner critical insights.
We've previously discussed our goal to create a bio analytics platform that leverages, our versatile technologies from biotherapeutic development through production Fda's widely publicized quality by design initiative has stressed the importance of understanding monitoring and controlling process parameters to ensure finished biopharmaceutical products.
Meet proper critical quality attributes also known as <unk>.
Pharmaceutical industry also recognizes that enhanced process understanding and control leads to improved yields and predictability, particularly important with the newer therapeutic modalities are devices are directly positioned to serve these needs.
A rebel product continues to expand its reach and impact.
Culture media qualification Bioprocess characterization and development for example, yesterday at the American Society of Gene and cell therapy Conference Bristol Myers Squibb presented on the utility of rebel for car T process understanding development and ultimately control ensuring the right first time production of car T.
Immunotherapies for clinical trials and production.
Our efforts are also expanding downstream into late stage development and finished product quality domains recently, we announced a joint collaboration to develop and extended teach you a workflow solution for approaching characterization biotech me owner of the leading protein analysis portfolio called protein simple where parents Maurice T I F.
Separations instrumentation with our ZIP chip device to deliver a seamless workflow for deeper protein characterization.
The protein simple line of Ci systems are considered the benchmark per protein size and charge heterogeneity quantitation, but are limited when detailed identification and speciation is required the pairing of Maurice and ZIP chip allows in depth characterization of biotherapeutics on and intact and near native level, and a vastly simplified and <unk>.
I'm saving workflow, our ZIP chip product line provide rapid high resolution identification and speciation of intact, proteoform with thermo broker and <unk> mass spectrometers with minimal sample preparation.
<unk> assays are necessary from lead optimization phase of drug development through production and release testing.
A growing need and the biologics market is the ability to measure multiple situate simultaneously per protein therapeutics. One such method is referred to as the multi attribute monitoring or Mam method.
Dan is a growing initiative to obsolete the many disparate and often low tech legacy analytical techniques by measuring <unk> with mass spec based methods capable of measuring a broad array of C QA simultaneously and with higher informing power.
A publication from Amgen recently called attention to the severe throughput limitations imposed by liquid chromatograph NCQA analysis and their published comparison of optimized Upa LC mass spec to ZIP chip mass spec for men of 15 and CTO as they concluded ZIP chip shows potential to improve.
Efficiency by increasing throughput by up to 20 X 10 minutes versus 200 minutes, while providing results comparable to those acquired using conventional Uhm plc separations. In addition to finished product C. QA analysis. The publication noted that ZIP chip shows great potential to streamline and early stage.
All assessments directly impacting development timelines, but expediting lead candidate selection.
We were particularly pleased to see that Theres a chip analysis was completing you are using our turnkey chips and chips without further optimization or modification, making analysis fast and remarkably easy.
We're excited that our customers are seeing impact across the stages of biotherapeutic development. We're also proud to highlight that our customer trend sensor a global Biotherapeutics company has announced that its continuous perfusion and cell culture platform has achieved industry, leading biometric productivity of greater than six grams per liter per day, while maintaining process and product quality.
[noise] attributes and the state of control for a four week culture trend sensor relies upon rebel per process monitoring and ZIP chip for rapid product quality attribute testing whether for fed batch or continuous perfusion processes, we see roles for our devices.
To guide our platform expansion into the future. We recently announced the expansion of our scientific Advisory Board and a focused panel on bioprocess thing and Biotherapeutics. We're excited to welcome. These six new members. This new formed panel of world renowned experts spans academic leaders at the forefront of cell and gene therapy and process optimization.
And industry experts and process development scale up and production.
The depth and breadth of this panel will be instrumental and providing feedback and guidance on our near and long term technology roadmap.
Overall, I'm really encouraged by the momentum we're seeing from customers. The talent, we are adding to our team and the technology platform progress, we are making with that I'll turn the call over to Joe for more details on our financials.
Thanks, Kevin and.
Revenue for the first quarter, 2021 was $5 5 million compared to $4 million and the prior year period.
And service revenue for the first quarter 2021 was $5 4 million up 103% from the prior year period.
This increase was driven predominantly by an increase from amex and anyway, and rebel units as well as strong recurring revenue.
Importantly, we are starting to see increasing contributions from recurring revenue as our customers become more active and our desktop installed base continues to grow.
License and contract revenue for the first quarter 2021 was approximately 200000 down $1 2 million from the prior year period. The decrease was anticipated and we do not expect license and contract revenues to be a significant contributor of revenue on a go forward basis.
As our business evolves, our revenue mix is more weighted towards product and service revenue, which is a more sustainable growth driver of long term growth.
Our installed base grew to 1000 and 427 units with 66 devices placed during the first quarter.
This increase and placements was driven by IMAX nine wage and rebel devices. This included the shipment of a number of IMAX 900 units in Q1 that we had previously anticipated for shipment in Q2.
Gross profit was $2 9 million for the first quarter of 2021 of 39% increase from $2 1 million for the prior year period.
The increased gross profit was driven by a $1 7 million increase and product and service gross profit, partially offset by the lower license and contract contribution.
Product and service gross margin was 52% for the first quarter 2021, and 1100 per basis points improvement from 41% for the prior year period.
Total operating expenses for the first quarter of 2021 were $8 7 million compared to $4 9 million and the prior year period.
The increase was driven by head count expansion across our business, primarily focused and our commercial organization and increased expenses related to operating as a public company.
Net loss for the first quarter of 2021 was $6 1 million compared to $3 million and the prior year period.
We ended the first quarter of 2021, with approximately $149 million and cash and cash equivalents and us.
And we also had $15 million of debt outstanding.
Turning to our outlook for 2021, we continue to expect revenue to be and the range of $38 million to $40 million representing growth of 45% at the midpoint over the prior year period.
We are pleased with our performance this quarter.
Outlook for the year remains unchanged. We continue to expect the majority of revenue to be more heavily weighted to the back half of the year as we continue to ramp up our commercial efforts and experienced seasonality over the second half related to year end cycles.
At this point I would like to turn the call back to Kevin for closing comments.
Thanks, Joe before closing I want to thank our team for their incredible work to bring to fruition and our vision of democratizing mass spec by breaking it out of the confines of the central lab and bringing its power to the point of need most.
Most excited about is the momentum and enthusiasm, we're seeing across our customers and pipeline of customers.
Made great progress this quarter and to continue this momentum throughout 2021, we are executing to drive expansion across our sales channels customers and platform. We look forward to updating you on our future progress with that we'll now open it up for questions.
Thank you as a reminder to ask a question you will need to press star one on your telephone to it.
Sorry, your question from Christopher Please stand and bond with a part of the Q&A roster.
Our first question comes from Doug Schenkel with talent and we proceed with your question.
Good morning, everybody and thank you for taking my questions.
Kevin maybe maybe a couple for you to start and then I've got a follow up for Joe.
First could you help us contextualize the importance of the Amex 908 enhancements I'm wondering if these and themselves open up any new market segments or make it easier to move into some some adjacencies then relative to how you are positioned before and then where there were some of these <unk>.
Hansman and communicated to customers and advance of announcing.
Today.
And I ask because I'm just wondering if these these enhancements themselves had an impact on our order trends over the recent weeks or months.
Yeah got it thanks, Doug for the question.
Yes, we're excited for the enhancements to the Amex nine await the handhelds there we.
We had stated and the path that we're really trade and this momentum as we see it and building out our platform across handhelds, and desktops, and and adding new features and capabilities and the ones. We announced this week for the Max We do think R. R and meaningful the Bluetooth connection allows the device and more seamlessly connect with with with the with the cloud per.
Dates and allow service supports and transfer of information and then also we announced the arrow, which allows it to do another state of matter today, its a solid liquids and papers and now with the era. It allows us to do.
And <unk> particles, so, meaning things like central and opioids, which are so toxic to our first responders. So we think there are meaningful yes, we've worked with customers to define as we do for all of our product release with key customers to define it. So so there certainly are some customers that are knowledgeable about what's been bidding.
And we use their input to define.
But I think they're meaningful but I think at the end of the day, there really just a guess.
Good proof point for the continued expansion and capabilities and the value when a customer buys and amex that we're going to keep investing in it and keep upgrading their capabilities and its and its something that zone.
Is worthy for them to step forward and continue their adoption.
Okay.
Helpful, Kevin and maybe one more for you just on.
ZIP chip and your strategy to address the large molecule characterization market.
Could you tell us a little bit more about how youre thinking about that moving forward I mean, it certainly seems like you could be and Ah.
Both are competitive as well as a complementary position to some of the.
And the existing large mass mass spec and comments so anything you could share on how are you.
Do you anticipate moving more aggressively with flip chip and this application would be would be I think of interest.
Yeah, absolutely I mean ZIP chip is founded on our on our Microfluidic technology and and it's essentially the same consumable technology, that's within our rebel device and let me talk a lot about per bio processing, but ZIP chip is more of a broad capability platform that connects to a conventional mass spec is as you know and and allows them to be.
More of a discovery open access tool to explore new spaces, and large molecule detection and characterization and monitoring those are those are very important for the industry of Biopharma of course and.
We see ZIP chip is really an alternative to LC or you HPLC rather than because it is connected to a typical conventional mass spec. So I would say if anything it's more competitive with those front and separations technology, where it really really excels is it simplicity of sample prep and the speed of separation and.
And our strategy there is really to work with key opinion leaders and key successes across Biopharma and quite a number of our products are being used for charge variance analysis and critical quality attributes characterization and we had a very recent paper as I mentioned from from Amgen and that really shows advantages compared.
Conventional LC dramatic time savings there so maybe more like 10 minutes versus 200 minutes for a C. QE <unk> run there. So that's that's exciting for US and then really we also are looking to partner with organizations to allow us to connect into workflows that move downs.
Moving to later stages, and we announced the biotech the R&D collaboration where that's the goal.
Awesome, Okay and last last last one for Joe and then I'll get out of the way for others.
Joe I think in your prepared remarks, you mentioned that some of the amex and INO eight placements.
And may be mischaracterizing that so feel free to just correct me, but I think you talked about maybe some of those placements kind of getting pulled ahead into Q1.
I guess kind of what what would be helpful would be as we're updating our models.
You could do to kind of help us either quantify that and or.
I guess, even just talk about kind of pace in Q1 to Q2 and our model so to kind of clean up my my jumbled question here. It would be helpful. If you could kind of talk about how what.
What was the value of those placements that were pulled into Q1, and how and mindful of that should we be as we update our models, especially on a quarterly basis. Thank you.
Yes, absolutely. Thanks, Doug So, yes, you're right as I mentioned in the script. We did include the shipment of a number of <unk> and I know units in Q1 than we had previously anticipated of shipment in Q2 and it was all connected to one opportunity and it was then.
And the majority of the beat.
For the for those spreads here in Q1.
As far as pacing and we think about.
Going forward, we expect revenue.
And I need to be more heavily weighted to the back half of the year, probably about two thirds of our of our guidance.
This would align with historical trends and some of the government year end spending and farmer yearend push.
As you might recall 2020 was an exception with the deployment of handhelds and Q2.
2020, where we accelerated the shipments to this from COVID-19, uncertainties, and we'd expect 2021 to return to more traditional trends.
So hopefully that helps as far as thinking about Q1, Q2, and the full year, which was really our primary focus for 30 to 40 minutes $40 million per year.
Got it okay Super helpful. Thanks, Thanks, guys.
Welcome.
Thank you. Our next question comes from Puneet <unk> with SBB Leerink you May proceed with your question.
Yeah, Hi, Kevin Thanks for the questions and first one Joe for you and just a quick follow up.
In terms of the pull forward that you've mentioned here from second quarter to the first quarter.
And that would imply that.
And maybe rebel and chip and I totally appreciate that rebel is that new product and the market and it's early and.
It is going to be.
Early days for our product.
In terms of the launch and adoption so maybe given the context of <unk>.
<unk> nine O eight within that 66.
Units that you had in the quarter could you quantify for us maybe whats happening on the rebel and and then maybe another one for Kevin.
Rebel is obviously, a very important device major innovation in this space and by analytics and bio processing analytics.
So could you maybe quantify sort of what are you seeing in terms of adoption.
And what is the commercial sales force seeing out there right now and as you have conversations with customers.
And so I'm trying to get started.
And so I start off with the last one there and parse that out quickly, but really I mean, we're seeing good adoption good color on that.
We've seen with with that through that through the quarter as you mentioned more than 50% of the placements were with new customers this quarter, but that's important and says well because we've got good repeat customers there.
And then we've got about 40% of those desktops, Npower and top 20 Biopharma.
So that's those are all good trends from from where we see it.
We are seeing customers speaking more and sharing more about their successes, which is encouraging.
We've mentioned that Bristol Myers Squibb, Vice talked yesterday.
Talking about how the Acs and the value proposition of the rebel and the cell and gene therapy and and trend Center.
Global leader and and Biopharma and Asia has had some other devices, both flip chip and rebel and they're seeing some encouraging results as they work to optimize their process and which is a profusion process by the way and I'll turn it back to Jeff.
For some additional color puneet as we think about unit placements and growth across both desktops and handhelds both grew year over year.
To give a little bit more color on the 66 devices 50.
<unk> 53, or <unk> 98, we had nine rebel devices and for us It chip so excited by those 13 deaths desktop.
Deployments and the 53 on the Amex was where some of the opportunity to meet a customer.
Request came in Q1.
Got it that's super helpful, Joe and thanks for that and Kevin.
Kevin if I could.
Asked around sort of the commercial expansion, which is.
Very important here and the near term and you.
You're on track for that right now maybe even slightly ahead.
And if you could if you could give a sense of in terms of.
Rebel and what are.
And what are some of the key priorities are there.
What are some of the feedback from the customers in terms of applications and.
No.
New product enhancement that they would like to have and again along those lines.
What is the pull through that you have now and I know you have given a number that is.
And if it can really higher by 2023 for pull through and rebel is that.
That is your are you seeing acceleration and that number with some of your customers using this device for over a year and then lastly, if I could just asked on in terms of any updates on the army contract is that still the second half is that how should how we should think about that contract and the cadence of that contract. Thank you.
Sure so from the from the R&D perspective, and rebel perspective and enhancements.
True for handhelds true per desktops really working to drive that drumbeat as we've talked before around the new capabilities and that includes things like analyte panel extensions new software applications and additional assay kits that we've talked about accessory modules like like we've announced a bit here this week.
But then third party hardware and software integrations and and all of those I think we're doing well and staying connected with the customer to ensure that they are on point for what they need and particular areas that we're focusing immediately on the rebel or is in those integrations with the with third party software because.
We do see the value to a customer that now we're giving them 32 analytes that they can measure that they couldnt readily measure at their fingertips before and that's a wealth of information a wealth of data and helping them have an opportunity to mine that and make it easier and easier and we're very much committed to and outside of that we're really still working towards that longer term.
Vision that you alluded to which is which is moving it to and online device and and.
And moving it from.
More and more to a more of being integrated with the bioreactor itself over the long term Joe you want to comment on the pull through that we're seeing there.
Sure absolutely so for rebel we are.
So and the early stages, but gaining exposure and.
And traction with our rebel customers, what we're seeing and average of about that one per month per active users and we're continuing to monitor and learn from from those customers and their use cases and the range of utilization that we might see over the coming months and years, So no change and utilization to what we communicated to date.
But on the plus side, we are seeing some rebel customers desiring to get on a regular schedule for their consumables, which is exciting.
Maybe to touch a bit on the U S. Army question and are subscale opportunity. So for 2021 and our guidance does include.
Some anticipated timing of the U S Army purchase order.
Not specifically given the details and.
And there are some initial shipments from 2021, but the majority will be in the course of 2022 net.
It did not have any here in Q1 related to that new purchase order of <unk>.
<unk> anticipates some to begin going out the door and the second half.
Got it okay, great guys. Thank you again.
Okay.
Our next question comes from Dan Arias Stifel. You May proceed with your question.
Hey, good morning, guys. Thank you just wanted to ask a couple of market expansion questions and my own if I could maybe starting on the amex system and just thinking about the opportunity in front of that product. Obviously, you have the set of forensics applications that youre working on drugs of abuse counter trading et cetera.
But during the process last year, you talked about the ability to place systems.
With me.
And the QA QC environment related to GMP work, because you kind of expand the base of software applications can you touch on that and how we should think about penetration and that portion of the market for the amex system devices.
Yeah, that's right, Dan and you talked about that we're still making.
And there we do believe that the amex as a pretty capable mass spectrometer, and a handheld form factor and and we do see opportunities in the areas that touch into that QA, QC and domain, and particularly and the G&P areas as you mentioned.
As we've discussed in the past like cleaning validation and incoming inspection for.
And for Pharmaceuticals are where we're looking at today. So we're making those strides we're making hires and those areas and today, it's really a development effort for us to work to unlock the capabilities and really designed the software specifically to address those customers and users.
Okay, and then maybe on the rebel system, and then getting out and some of the things that I think when he was trying to talk to you there.
Do you think when we see future versions of that device, we see sort of a phased advancement so to speak and that.
The analyte panel gets expanded and and Theres a version there and then down the road.
Net online monitoring or a direct integration with the bioreactor or is it really we're going to go from Gen. One Gen. Two and Gen. Two will have all of the advancements that we're kind of talking about here.
Yes, I really see it is that continuous phased capabilities that are being added and unlocked with the existing box or future hardware variants of it.
So yes, most immediately and things like working on the software integration and as I previously mentioned here and to make it more seamless to get the data out and and allow people to mine it.
But then also we're seeing traction into areas like synthetic biology, and clean meats and staying close to those customers and optimizing the that kept the consumable kit, if it's required or the analyte panel.
And adding additional analytics that could be interesting to customers through their feedback and we think it's a pretty comprehensive panel today, but adding additional continues there and then continuing to walk that forward and these software and hardware consumable updates and then working towards the online integration.
Maybe first through third party integrations before it becomes something more instantly connected that we've talked about and the long long term vision. So yes, I think that's right to view it as a continuous progression.
Okay helpful. One more from me on the <unk> side, and just thinking about the orders from the state Department and one of the individuals that we spoke to had suggested that there's some efforts that are ongoing and the government to sort of.
Standardize and I guess harmonized the approach to adoption and usage and the U S. Government. How much are you finding the siloed and nature of the government to be a bottleneck today and is this effort that she referenced something that youre seeing are you hearing about from your seat and if it is in place do you think that can actually.
Sort of help to speed up and uptake at the federal level anyway, and maybe even the state level, but certainly from a level.
Yes, I think across all sections of the federal government and state and local government Ah Theres differently, there's definitely efforts to be more of a standard capability more of that standard of response or standard of care equivalent rate and.
We see that internationally as well many.
Many of these things can be more grassroots organized within local states or states that work together or a response team within a particular area and the federal government.
And I mean, we I wouldn't say, there's one theme that we see across the entire United States, but I'd say there definitely are pockets and we mentioned on the call today that the part we're excited for some of the adoptions that we've got is for the state Department, specifically right, they're sharing best practices across the globe.
And for how to stem the tide and these illicit and counterfeit drugs, so getting plugged in there and getting getting those customers successful having that become a standard if you will.
<unk> is impactful and we think long term. We also mentioned that the LSE and National Center for Biomedical research and training, which is really a training organization that set the standards and bye.
By doing thousands of training to be and then she response community across.
Across the U S and the goal of each year and that helps.
Customers and future customers get get and understanding of what best practices are and what to expect from from devices like <unk>, nine and weights and really help ultimately inform our buying patterns we believe.
So yes, so we think there's many customers there that we're working to ensure the success that that will will help in the standardization and getting more of that flywheel effect going.
Very good okay. Thanks, Kevin.
Thank you and as a reminder to ask the question and need to press Star woman and telephone. Our next question comes from Brian Weinstein with.
William Blair you May proceed with your question.
Good morning, Thanks for thanks for taking the question.
If we could just kind of go back over Tam expansion and it's obviously a critical part of the story you've spent a lot of time today talking about it you spent a lot of time and.
And investor meetings talking about it one of the questions that I would like to maybe better understand is.
When we look at that massive Tam expansion over the next handful of years, how much of that is a function of the internal innovation that you guys are doing in terms of.
And our sophisticated plumbing as you've called it and the past as well as the.
And alright edition and software updates versus what you're expecting from the end market cell and gene therapy, potentially and other end markets to grow so.
Is there any way to kind of tease out how much of that you control versus how much of that Tam expansion is is really market driven.
Yeah. So I mean, you certainly we've shared Tam expansion and numerous areas things like I mentioned already today, the QA QC dimension for for Handhelds and.
The research dimension for what we're doing there chip.
Chip and pushing it into some of these other workflows that we already mentioned today and so I think all of those are very well.
Under our under our control and there is obviously that the market is.
Favorable in terms of if you look at the biologics pipelines and Biopharma and support that I think where you see a significant leverage point is that ultimate vision of taking rebel to be that really that core analytical hub. That's sitting next to integrated with the bioreactor and we see a significant chunk of that Tam and what we shared and the 2020.
Five timeframe driven by the rising tide of cell therapies, and the biologics pipeline shifting over to those modalities, particularly the autologous cell therapies, which drives small batches and high high numbers of them.
So it's a bit of a mix there I agree with you and its sophisticated plumbing if you will.
But that's I answered earlier that we really see this continued progression and the development that continuously unlock that and we see our ability to bring those enhancements out.
In our control, but then when you see this leverage points that could be significant.
When were timing to the cell therapy pipeline, so and that gives a little more color Bryan.
Thank you for that.
And then as it relates to guidance.
Can you guys talk about how customers are progressing through testing trial pilot and enterprise adoption.
And the past I.
I think you've given some numbers.
Customers that are kind of in various phases, there and I'm curious if the.
Slow down and in COVID-19 cases, and kind of a return to normal starting to return to normal a little bit if that's changed the processes and how people are moving through those those various phases.
Mhm.
Absolutely. So just circling back on guidance as a whole we did issue our full year guidance at the very end of Q1 headline.
Your line of sight to the quarter when it was issued and feel great about our business and the guidance range, we put out.
And as you saw we had $5 million for the quarter and are planning to between $38 million to $40 million and the year. So we have a lot of work ahead of us, but a big piece of that is the assessment and monitoring that progression.
Through the funnel and the pipeline.
First the trials to pilots ultimately to deployments, we did provide some specific breakdown at year end and we will continue to assess that and are probably mid year and definitely annually.
So we continue to see good progress U S Army that we announced in March was a great Testament to the progression.
Custom and border border patrol and recent announcements.
They are and pilots and looking to deploy gives some opportunity for the back half so.
I'd say no significant changes and don't see us.
Correct impact to COVID-19 at this point related to that especially at the federal and.
And the military side, a little bit of impact on international.
But that's really and.
Kind of regions like EMEA and others.
COVID-19 some more ramp it today.
Okay, and then last one from me if I could squeeze one more and here.
I can't remember, Kevin if you Senator Joe you said in your prepared remarks, but I thought I heard picked up something about how.
And the pull through was trending starting to trend a little bit better and then I think of it and a Q&A answering you guys talked about you know kind of sticking kind of at that one kit per month I just wanted to kind of make sure that I heard you right that things were starting to trend, maybe a little bit better and if I didnt hear it right that and please correct me on that.
Sure, Yes, so on rebel yes, we're still seeing that about a kid of months.
From our active installed base and we're excited that we are seeing.
Units and.
One or two customers that might be more than that one kid amongst some less but on average about a kid a month.
Part of the color that you heard me talk about was that overall, our recurring revenues were trending positive within the quarter and a piece of that was with flip chip and some of the the consumption with folks being back and allowed for Ya.
And here in the first quarter, so we saw and uptake on the ZIP chip size and <unk> and.
Recurring revenues and also on service as folks are coming off warranty.
And for Amex, and ZIP chip and we're seeing the renewal rates and commitments to the customers.
Pick up and we're not seeing a blip coming off the heels of COVID-19 last year. So that was some of the color on the positive trends, but specifically on rebel that one kid a month and we're seeing that play out at this point.
Okay, great. Thanks for that clarification, thanks, guys.
Yeah.
Thank you and I'm not showing any further questions. At this time I would now like to turn the call back over to Tim Goodnow for any further remarks.
Yes, just thank you all and thank you all for your time today.
And we're looking forward to giving you further updates and have a great day.
Thank you ladies and gentlemen. This concludes today's conference call. Thank you for participating you may now disconnect.
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