Q3 2021 Olink Holding AB (publ) Earnings Call
Ladies and.
Gentlemen, thank you for standing by and welcome to the only multi Omics Q3 2021 earnings conference call. At this time all participants are in a listen only mode. After the speaker's presentation there.
There will be a question and answer session to ask a question. During the session you will need to press star one on your telephone if you require any further assistance. Please press star zero I would now like to hand, the conference over to your speaker today John Medina. Thank you. Please go ahead.
Thank you Patrice and good morning, everyone and thank you all for participating in today's conference call.
On the call we have John Hymer, Chief Executive Officer, Oscar gallon, Chief Financial Officer, and call Raymond Chief Commercial Officer.
Earlier today <unk> released unaudited financial results for the third quarter ended September 32021, a copy of the press release and an updated corporate presentation are available on the company's website.
Before we begin I'd just like to remind you that management will make statements. During this call that include forward looking statements within the meaning of the U S. Federal Securities laws, which are made pursuant to the safe Harbor provisions of the U S. Private Securities Litigation Reform Act of 1095.
Any statements contained in this call that relate to expectations or predictions of future events results or performance are forward looking statements.
Actual results may differ materially from those expressed or implied in the forward looking statements due to a variety of factors.
For a list and description of the risks and uncertainties associated with our linked business. Please refer to the risk factors section of our final prospectus relating to our registration statement on form F. One final number at $3 33 to $5 $7 $8, two which was declared effective by the U S Securities and Exchange Commission on July 14th 2021 and on.
And our other filings with the SEC.
We urge you to consider these factors and you should be aware that these statements should be considered estimates only and are not a guarantee of future performance.
Also in their remarks or responses to questions management may mention some non-GAAP financial measures reconciliations of adjusted gross profit and EBITDA and certain other non-GAAP financial measures to the most directly comparable GAAP measures are available in the recent press earnings press release available on the company's website.
The conference call contains time sensitive information and is accurate only as of the live broadcast today November 10, 2021, holding 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 except as required by.
Law and with that I'll turn the call over to John John.
Thank you John and good morning, everyone and thanks for joining <unk> third quarter earnings call.
I will start with a review of our operating results and strategic objectives before turning the call over to Oscar to discuss our financial results and full year guidance. Following that Carl will provide his perspective on the commercial side. We will then open up the call for questions.
First I would like to personally thank all the talented and driven members of the <unk> team for their hard work and their execution and look forward to working alongside you as we develop the market leader.
In proteomics our performance during the third quarter of 2021 was strong we continued to execute on our strategy of expanding the adoption of the <unk> proteomics platform to drive improved understanding of real time human biology.
We remain optimistic about the prospects for all link customer interest interaction and enthusiasm continues to be in line with our internal expectations set earlier this year.
It is clear to us that our technology and commercial strategy is resonating with customers across industry research and academia.
We had a robust quarter with total reported revenue of $20 million representing growth of 82% compared with the third quarter of 2020.
This brings our year to date revenues for the nine months ending September 32021 to 51 3 million U S dollars.
Ahead of our internal plan for the year.
Our total constant currency revenue growth ex <unk> was 79% year over year.
Revenue growth in the third quarter was 14% while service revenue growth accelerated to 152%, partly due to the delivery and revenue recognition on the UK Biobank project.
While this dynamic drove a shift in revenue mix towards services in our <unk> impacting <unk> overall gross margin. It's important to note that our gross margins were within expectations and very strong.
Overall.
Q3 performance was the result of focus and strong execution, despite friction driving more customer activity into and beyond the month of September.
A modest COVID-19 risk charges in the broader supply chain across certain geographies.
When considering the supply chain plastics in particular have been a limiting factor with some core labs now facing a minimum four month lead time for <unk>.
Supply chain disruption was also seen in the form of delays with some lab instrumentation and shipment of samples.
Irrespective of these factors, we believe the third quarter is want to be proud of and that only continues to be well positioned for continued strong growth.
The third quarter was also our second full quarter of explore kit sales and we finished the quarter generating kit revenue from 'twenty one explore installations.
It is important to remember that there is some time in training required on each installation before customers are pulling through consumables.
There is further incremental time until they are put into routine use.
We remain confident in the high level of interest from potential explore keeps users based on active discuss conversations and customer feedback.
As of September 30, we had 21 explore installations compared with 16 on June 30th Rep.
Representing 31% sequential growth.
Despite more installation securing later in the quarter than planned the last 12 months consumables.
At very attractive levels of about $550000 over the last 12 months.
Given the current stage of customer adoption and expected seasonality of customer utilization individual keep the risk can significantly impact the average pull through metric and quarter to quarter variability can be expected going forward.
Looking into the remainder of the year. We're also pleased to see the fourth quarter explore business off to a strong start with installations consisted consistent with our annual forecast.
The explorer pipeline remains robust and supports the plan that we have set out for the year and a good starting position for 2022.
We're also encouraged by the fact that we see a good representation of both by format.
Kadena customers in that pipeline.
We remain on track to hit our annual revenue guidance of 90% to $92 million for 2021, although we continue to monitor the potential impact from the Covid pandemic.
From a regional perspective, we saw positive quarterly revenue growth and solid penetration of explore in all the regions.
We continue to ramp up investments into our organization and we're excited about the strong team that we are continuing to expand globally.
I don't think we continued to find success and strong traction in all three of our product lines explore target and focus.
Explore represented 63% of our total revenue in the third quarter of 2021 as compared to 53% in the previous quarter.
And year to date, the explore platform represented 57% of our total revenue.
As you'll recall, we announced the expansion of explore with introduction of the owned linked explorer <unk> 72 in June we started taking orders in the second quarter and deliveries are expected to begin in the fourth quarter of 2021.
Paul will provide color additional color during his prepared remarks.
We know where customers are very excited about the expansion of our protein biomarker targets, an ambition to expand to 4500 protein by market targets in 2022 remains on track.
And moving to our target and focus products interesting interesting signature Q1 hundred has been strong thus far and we are on track with the deliveries in the fourth quarter.
In addition in the third quarter, we reached an exciting milestone with the first major data delivery on the UK Biobank pharma Proteomics project one of the world's largest studies of low blood protein biomarkers conducted to date.
The project to use of old links Ta technology aims to significantly enhance the field of proteomics, enabling a better understanding of disease biology, and supporting innovative drug development for project participants.
We are in the process of running 56000 samples on the first 500 protein expected to finish this year and plan to around the expansion of the explorer <unk> platform on the samples in 2022.
We view this exciting research project is an investment in scientific discovery deepening our relationship with <unk> Biopharma consortium members and the broader scientific community.
A key part of our strategy is to work closely with fourth and key opinion leaders to drive the focus and content of our library, new product development validation strategies and enhanced data analysis.
We see a strong trend amongst market participants to collaborate and share data.
<unk> has been selected to work with various consortia, including the UK Biobank and the scallop group previously discussed on our second quarter call.
In the third quarter, we announced the old link partners. Cora consortium was formed chaired by neuroscience thought leader Doctor Charlotte to Nissim.
<unk> is the new collaborative community of scientists working on it.
Holding platform to investigate diverse neurological conditions by studying in blood and CSF fluid in an effort to identify novel Biomarkers and biological mechanism for neurological diseases.
The large quantity of proteins measured in your logical disease research demands analysis of most people biologically relevant proteins simultaneously.
And this opens opportunities to smoothly translate findings into clinically useful biomarker tests.
We are proud that <unk> proximity extension assay technology is being used in these important collaborative research on neurological health.
Looking forward <unk> remains focused on investing in the business to accelerate research and development as well as to expand our commercial infrastructure to drive revenue growth.
We ended 2020 with 214 employees and continue to deliver on our strategic plan to build out the organization and at the end of September 2021, we had 379 employees.
These efforts to expand our presence have proven beneficial and we expect continued aggressive investments during Q4 and into 2022.
The people and technology is driving a link are helping us drive the proteomics conversation with more than 750 peer reviewed publications to date, featuring the use of our platforms.
This number is growing significantly and we consider it a tremendous source of validation and differentiation for our industry, leading platform our go to market capabilities and the real world applications, we are enabling today.
For instance, this summer a paper published in the announced of oncology by what this doctor Johan loyal on Sweden, Italy adult explored protein biomarkers and their relationship with immune checkpoint blockade resistance.
This study leveraged <unk> explored first to cast a broad net the biomarkers and found strong evidence for the role of one biomarker leukemia inhibitor factor.
Is it potential suppressor of antitumor immunity.
As a follow up on this very exciting finding they ran the opening target 96 inflammation panel, which also includes lift in a different cohort.
And verified and confirmed their initial findings.
A great example of why and how we build our product portfolio.
For various use cases and stages of experiments and how customers use them as the first discovery step with explore followed by verification of preliminary findings with target.
Furthermore, Nyx is not only on new potential response prediction biomarker. It also provided additional important information to the currently clinically established Biomarkers PD, one and PD lone.
While the field of oncology has made tremendous strides in recent decades, we expect additional progress make dates and in <unk>.
Identifying more liable predictors of response is needed.
And we believe next generation proteomics is likewise needed to get that is relevant information.
Scalable technologies, such as ours will allow efficient discovery verification and clinical validation of Tomorrow's improved biomarkers.
Another recent example was featured in the journal of the American College of Cardiology, just last month by month. He is <unk> at this.
These study explored or link enabled proteomics and machine learning with the goal of improving prediction of cardiovascular mortality in at risk populations.
It included the discovery cohort of almost 2000 individuals and a verification cohort of 772 subjects you see utilizing the UO linked cardiovascular two panel consisting of 92 pre selected and relevant protein biomarker targets.
In our opinion the data generated represent the remarkable early example of applying machine learning to large datasets to better estimate the risk of mortality.
In this study the combination of machine learning and protein by a market based prediction significantly outperformed classical risk score for all cause mortality.
Classical risk scores such as the Framingham risk score are based on only a few biomarkers for example, BMI blood pressure smoking and blood cholesterol and accuracy of just over 60%.
However, this protein biomarker machine learning approach provided a striking improvement in risk prediction of over 90%.
We think these are impressive results and representative of the type of projects our customers are conducting on our platform.
It's also very encouraging to see how this strategy could pay off with potentially a great and important results for human health.
In an effort to help the investment community to learn more about our link and how our customers are using our proteomics using proteomics to understand human biology to make more informed research and clinical decision, we're hosting our inaugural Investor day on November 15th.
We put what we plan to provide an overview allow us keep some key opinion leaders in the field of proteomics, including Rob Garstein R&R met with them and my group months that anchor itchy and Chris Wheeling or using the OLED product portfolio spanning across explore target and focus in that work.
They will share our views on how our technology helps in the research as well as how proteomics is evolving.
We've decided to host this event in a virtual format. However, it is our intention to meet many of you in person in 2022.
So today, we're planning to be in San Francisco in early January when many of you are likely to be there as well attending an investor conference.
In summary, we are pleased with our third quarter performance. We are confident we have the framework in place to continue continued executing on our investment and strategic plans and drive meaningful growth for the years to come.
I will now turn the call over to Oscar to discuss our financial results ill Scott.
Thanks, John and Hello, everyone.
As John mentioned earlier total revenue for the third quarter of 2021 was $20 million as compared to $11 million in the third quarter of 2020.
Revenue growth was driven by the continued momentum in the expansion of our explore platform in particular explore service revenues, which grew more than 12 fold year over year.
Q3, 2021 represent the second full quarter of sales activity for our explore kicked offerings and variability in overall explore product mix during the initial quarter of customer adoption can be expected.
I will explore service revenues are driven by a broad spectrum.
Vectren of customers across the Americas, EMEA and rest of the world.
As at the end of the quarter, we had 21 externally placed explore installations that we have generated revenues from in 2020 in the first nine months of 2021.
2020 kids revenues related to early access customers primarily occurred in the fourth quarter.
We've seen an average pull through on these customers of some five to $600000 with individual customer spend rate ranging from less than $100 2 million dollar orders.
As John indicated in his opening remarks, we expect customer demand to follow a seasonal pattern.
More specifically, we anticipate demand will likely be higher in the fourth quarter and likely lower than other quarters.
Analysis services revenues for the third quarter of 2021 was $15 1 million as compared to $6 million for the third quarter of 2020. The service growth continues to be driven by explore across all regions.
<unk> revenue for the third quarter of 2021 was $3 7 million as compared to $3 2 million for the third quarter of 2020 explorer kits revenues accounted for 15% of explore revenues in the quarter as previously disclosed the majority of explorer kits revenue in second quarter 2021 was attributable.
To one order.
Other revenue was $1 2 million for the third quarter of 2021 as compared to $1 8 million for the third quarter of 2020.
Looking at revenue by geography revenue in North America was $6 9 million as compared to $5 8 million for the third quarter of 2020.
In EMEA revenue was $11 8 million as compared to $4 4 million in Q3 2020.
Revenue in China, Japan, and rest of the World was $1 3 million as compared to <unk> 8 million in the third quarter of 2020.
Cost of goods sold was six $7 6 million in the third quarter of 2021, resulting in a gross profit of $12 4 million in the third quarter of 2021 as compared to cost of goods sold of $3 2 million in the third quarter of 2020, which resulted in a gross profit of $7 8 million in the <unk>.
Third quarter of 2020 <unk>.
Adjusted gross margin decreased to 65, 6% compared to 74, 1% for the third quarter of last year. This decrease was due primarily to a shift in overall product mix towards lower margin service revenue as well as a reduction in service gross margin itself as we continue to invest in capacity.
We also delivered that UK Biobank project is very strategic pricing and experienced lower operational efficiency in the labs and anticipated.
<unk> gross margin is generally in line with our expectations by segment adjusted gross profit margin for analysis service was 59% for the third quarter of 2021 compared to 75% for the third quarter of 2020.
The decrease in adjusted gross profit percentage was primarily related to the reduced operational efficiency associated with new product offerings and an increase in personnel cost as we have increased our lab capacity further.
Further we delivered UK biobank revenues in the quarter and they were priced at very strategic levels. We continue to believe that our strategy to increase increased kit revenues as a percentage of total revenues will have a positive impact on mix it over the longer term.
Quarter to quarter variations are to be expected.
Adjusted gross profit margin for kits was 91% for the third quarter of 2021 as compared to 83% for the third quarter of 2020 keep gross margin remains largely in line with our expectations and we believe it represents an underlying gross gross margin level for our kids business.
Adjusted gross profit margin for other was 74% in the quarter of 2021 as compared to 54% for the third quarter of 2020.
Total operating expenses for the third quarter of 2021 were $24 1 million as compared to $8 6 million for the third quarter of 2020, we continue to invest and build out our global commercial team invest in our R&D team.
And growing our library of assets. The increase was further driven by costs associated with being a public company.
Commensurate with the opportunity in front of opening we expect to continue to invest according to our strategic plan and aggressively grow all parts of our business.
Operating expenses are broken out as follows selling expenses for the third quarter were $9 million as compared to $2 8 million for the third quarter of 2020.
Administrative expenses for the third quarter of 2021 were $11 million as compared to $4 4 million for the third quarter of 2020.
Research and development expenses were $4 2 million for the third quarter of 2021.
I had two $1 3 million for the same period in the prior year.
Other operating income was <unk> 3 million in the third quarter of 2021 as compared to a loss of $1 1 million in the third quarter of 2020.
Net loss for the third quarter of 2021 five.
$5 5 million as compares to north of $1 million for the third quarter of 2020 net loss per share for the third quarter of 2021 was <unk>.
As compared to <unk> 20 for the third quarter of 2020.
Adjusted EBITDA for the third quarter of 2021 was $7 9 million as compared to appropriately up $2 9 million for the third quarter of 2020.
We ended the third quarter with $140 million of cash and cash equivalents.
Moving to our outlook for the rest of the year and.
While the pandemic resurgence.
Introduced additional uncertainty in various areas of our business, we maintain our full year 2021 revenue guidance of $90 million to $92 million, representing 66% to 70% growth over 2020.
I'll now turn the call over to call Raymond our Chief commercial officer to provide a bit more detail on customer behavior. During the recent quarters and product initiatives. We are looking forward to cotton.
Great. Thank you Oscar.
So we made significant progress during the third quarter and remain very well positioned as a leader in the market I would like to thank all of our hard working and talented members of our commercial organization for the strong results.
John and after indicated year over year revenue growth was robust with strong expansion of explorer we executed positively. Despite several factors affecting the quarter first kit sales and timing were impacted by quarter to quarter variability that was more significant during Q3 pushing from revenue into the fourth quarter OLED <unk>.
Also saw more significant demand for explore service, which impacted product mix and consequently overall gross margin additional dynamics, including supply chain related friction off our old link and the industry more broadly. We're also presence. We believe some factors are being driven in part by the resurgence of COVID-19, while others are more.
<unk> of our rapidly developing in large commercial market opportunity.
We also experienced some of our customers taking a longer summer vacation with people arriving back for work later in Q3 than we've typically observed and planned for in our opinion Nonsignificant impairs the promise of the proteomics opportunity that lies in front of us.
OLED product explore target focus and now signature all resonate with current and prospective customers.
And we're strongly executing according to plan of the 379 employees. We ended the quarter with more than 140 are in the commercial team and we're just getting started.
Interest in signature Q1, Q1 hundred has been strong thus far with several orders in hand from North America, Europe, China and other parts of Asia Pacific. This positive response from our customers is reassuring and we're on track with deliveries in the fourth quarter as we had expected.
Through our collaboration with early adopter sell cargo, we will bring the signature Q1 hundred platform into sell Carter's cap CLIA laboratory to address the need for proteomics Biomarkers in clinical trial and support multi omics analysis with it sell engine software sell a car to global footprint with sites in the U S Canada, Belgium.
Australia, and China will allow for rapid deployment of the platform and support clients in their global clinical programs.
Moving back to explore as Youll recall, we announced the expansion of explore with the introduction of all link explorer 30 72 in June we have started to take orders with deliveries expected to begin in the fourth quarter of 2021.
We continue to see good traction on explorer externalization to date in Q4 and were optimistic that we will end the year with a number of installations that we had planned for at the outset of the year setting us up for further growth in FY 'twenty two.
On 3000, we remain committed to expanding our protein library, while investing in tool software and capabilities to help our customers.
Our customers are very excited about the expansion of our protein biomarker targets and our ambition to expand to 4500 protein biomarker target in 2022 remains on track and with that I'll turn it back over to our CEO John Hamre.
Thank you okay. Thank you Carl.
In summary, the third quarter of 2021 with another quarter of continued execution and growth.
We are pleased with the growing traction and robust adoption across our entire portfolio of products and services. We are particularly pleased to see the continued revenue momentum towards our revenue guidance continued progression of our <unk> platform.
In particular, the strong momentum and delivery on the explorer kit.
Demonstration strategy.
We look forward to providing future updates on the investments, we're making in our business and our strong operational and financial results.
At this point, we'll open up the call for questions operator.
Thank you at this time, if you like to ask a question Press Star then the number one on your telephone keypad.
Your line is open.
Yes, hi, thanks for taking my questions.
John I think given the quarter just the first question.
Alright fully so is on supply chain.
What are you seeing today versus let's say in September I think the main question among investors is that.
Is it worsening.
And.
More importantly, how do you see <unk> products are tied to the supply chain, meaning that in terms of is it plastic is it instrumentation. It obviously.
You're a consumables company. So I just wanted to understand is it the paper plate plastics that you mentioned is it the robotics or the liquid handling installations that are happening ahead of the explore.
Pick up just help us parse out what's happening exactly on the supply chain.
And.
The trend line, what youre seeing in the field.
Yes sure.
<unk>.
Yes, so as we expect we said in the press.
<unk> remarks, right. So in particular, it's down to meet the Greek destock like.
Pipette tips and plates and.
For core labs that are adults being the export platform.
As we communicated it could be more than four months of lead times to get those simple plastics.
But on top of that there's also some delays in the automation upstream ahead of the ignore instrumentation.
So we've seen delays in supply to our core labs on that front as well and Thats and then on top of that as well as I'm sure you.
<unk> right.
Shipping of product.
Across the world.
Strained and hence we see delays, sometimes in shipment of samples and so forth as well.
And I would call you can fill in but I wouldn't say that we see that it's worsening, but it's rather continued at roughly the same pace. We are super happy that we internally have been very forward looking and stocked up to our needs. We also try to help our customers.
Supplying them with some of these simple plastics, but we can't help everyone. So thats when we sometimes see some of the delays. Unfortunately, so I don't know call. If you want to add anything to that.
Yes.
Without being redundant I think you nailed it there John I think.
We don't necessarily see worsening, but a continuation of those supply chain strains on our customers and I think that covers actually many classes of instrumentation from third party companies as well as again, all the various plastics and so on.
And as John noted I think we have implemented them sort of clever mitigating strategies, where we can but of course, we don't control supply chain.
Across the industry. So I think we're going to continue to see some of that but we feel like it's manageable challenges.
Got it.
And then John on the fourth quarter Guide.
<unk> fourth quarter Guide I think the biggest question is given the supply chain and the timing issues that you're seeing here.
What gives you confidence in the fourth quarter I suspect part of that is the UK biobank, but correct me if I'm wrong on that.
Fourth quarter represents a meaningful step up for you based on our math I mean, obviously this is a fourth quarter seasonality you pointed that out before.
We're fully aware of that but just wanted to parse out how should we think about that.
The pickup in the fourth quarter, because it represents 90% or so sequential growth versus sort of the 13% sequential growth that you just delivered in the quarter.
And just given the supply chain's UK biobank and explore kits and what you're hearing from the customers could you help us just frame the.
Fourth quarter dynamic.
What you are implying in the guide.
Alright, Thanks Puneet so.
Obviously, we have been.
This is her first year being a public company as well and we've tried to be super careful here.
And what we say and how we execute and Pete.
<unk> very good actually on where we're at in terms of customer interest and demand.
So we certainly believe that we have lined up the opportunities to be able to meet the guidance that we are communicating today again.
No.
Carefully vetted our pipeline.
Customers projects.
Both from service and kits et cetera. So.
It's obviously still.
Few weeks left right. So we're not across the bridge yet then.
Obviously, keeping very close eye on.
Shipment of samples and needs to be done the keeps it needs to be shipped and so forth. So we're not out of the woods yet.
With very careful consideration of all the details we can look at in customer demand and interest and concrete business opportunities that are on the table. We remain confident in the continued sharing our current items.
Your next question comes from Tejas Savant of Morgan Stanley.
Hey, guys. Good morning, John will follow up on some of the earlier themes you just address that John.
Can you be a little bit more explicit in terms of that sort of $40 million <unk> implied guide what are you baking in for Covid impact I'm just trying to gauge.
How much sort of.
In short hands. If you will is baked into the numbers here, if COVID-19 trends don't get better in the back half of November into December.
Yes, no. So when we did our internal analysis, we've taken into account the current.
Covid situation, we see so here, we need to be on our front foot right, we need to be very proactive in terms of planning.
Shipments and.
Detailed execution of these opportunities perhaps in a higher level than what you use in normal circumstances are.
So yes.
Yes, no we've been trying to be extremely proactive there and then call. It peacefully in here as well from your perspective running the commercial side on the thoughts of steps and considerations that we've done.
Yeah, No agreed I think.
Fairly.
Intense level of detailed planning I think as John noted with the.
With the.
Continued friction from the supply chain issues.
But as noted.
We are not we don't have rose colored glasses on and expect that that's going to clear up in the fourth quarter alright, they even carrying probably into 2022. So yes.
Yes, so we've considered that I think in the context of our business, but I think the underlying momentum in our business in the interest in proteomics, we see customer budgets are remaining intact. So I think were sort of optimistic on on the business overall, but certainly being cognizant.
The COVID-19 drag.
We will continue for some time.
Got it.
And then a quick follow up for me off that $4 million kit revenue in the quarter, how much of that was from the code and then on the UK Biobank. How are you thinking about sort of contributions in the first half of 'twenty, two and any color on follow on population scale work that you had said it would be great as well.
Yes, Thanks, I guess, it's Australia. So I can address the first two questions are done on the popular.
Population studies I can defer to call, but I think the D code project, we delivered in Q2.
Nothing from from decode in in the third quarter.
And then in terms of the UK biobank, and how we see that impact in in 2022, I mean, we see.
The pricing has been relatively competitive.
And sort of strategic from our perspective, so it's a building block for to get to our internal targets for 2022.
Got it.
Relatively smaller contributor than the <unk>.
Projecting in 2021.
Great and on the population.
Biology piece I can speak to that yes.
Yes, we're continuing to see more interest in having more conversations and sort of large scale biology, proteomics, which is very exciting.
Nothing we can speak to any specific detail at this point, but certainly.
More information will be forthcoming as we as we develop those opportunities further.
Got it thanks guys.
Okay. Thank you.
Your next question comes from Mac Sykes of Goldman Sachs.
Hey, everybody.
And thanks for taking my questions.
If we just dig into the kit revenue.
A little bit more if you could just kind of parse out.
What was the COVID-19 related supply chain impact versus demand uptake for the explorer kit products, specifically just trying to figure out.
The cadence sequentially, it's explore kit growth and what's driving that.
Yes, good morning, Matt.
Good question so.
It was rather.
We had to push a few of the explore installations from the third quarter into the fourth quarter.
We had some delays of the.
The instrumentation or the plastic that goes with the training and certification.
So.
That unfortunately pushed some of those explore installations out debate in time, they have been performing now, but we didn't make them in the third quarter.
So that is obviously also then.
So.
Pushed out any keep revenues.
There is no no no.
No use for the customer to buy the rating kicked when they are not up and running on the platform if that makes sense.
Got it.
That's helpful. And then just looking at the mix between analysis service and kits.
You guys have been kind of beating our numbers on analysis service in coming in light on kits and I'm just wondering.
As that mix shift happens as we kind of head into 'twenty two.
Is it a supply chain availability issue that people are more comfortable doing some of the explorer work within analysis services and so it's driving more growth in that area relative to standalone kits and if so or if not how are you thinking about 'twenty. Two I know, it's early to talk about that but just trying to think of that mix shift.
We had anticipated more towards kits I'm, just wondering if analysis services stays kind of higher for longer as we kind of deal with some of these issues in the supply chain or maybe some other issues that are in the market.
Sure.
First of all.
We are super excited by the excitement and interest in demand for in store.
The first great stepping stone right.
And then we're now not out of the woods of this year yet so.
<unk> closed the books on.
Where we are at for the Externalization and kit strategy for 2021, when we see the full year.
I would not jump to conclusions yet.
From prior experience in the business.
A lot of things tend to happen in our fourth quarter is where the lateral.
So looking into 2022 as we hope that we will be on target on our strategic plans for explore in total for the year, we think that.
Gives us a fantastic springboard jumping into 2022, and obviously starting 'twenty to 'twenty two from a completely different situation in terms of explore external users than when we started this year and then we the excitement and interest and the pipeline. We are building for further expansion in extent.
On the <unk> platform, we continue to believe that 2020 to do will be a very exciting year for OLED as well.
And I would just add one agreement to that as we launch the Q1 hundred.
We will also start to see sort of.
Celebration of interest and externalization on our target platform as well.
So that'll be another factor playing into the mix over time that will be a positive.
Yes, thanks for taking my question.
Thanks, Sean Mcmaster panel.
Final question comes from Sanjay <unk> of BT.
Hi, Thanks for taking the questions starting out with a clarification question.
Obviously, you guys saw any.
And the cumulative number of external customers in the quarter.
But from.
And incremental new customer addition.
Five compared to last quarter.
Which was cool and I missed a little bit with some early access customers baked into that as well.
But all in all you are seeing.
There was a decline of a meaningful decline in terms of new customers added, but I was just wondering.
Main driver of that largely the supply chain constraints and youre talking about or.
Also curious.
Got.
If there is also a kind of shift in terms of.
Gaining new customers.
Full.
Through installation.
New explore system.
Arsenal leveraging the existing <unk>.
Sequences that are out there.
I don't know if that profile.
Yes.
Australia, So I mean, we.
We grew our installed base in the quarter over Q2, so I'm not sure I get the comments sort of with the.
The loss of customers or the reduction in the customer base. So perhaps if you can clarify that.
Oh in terms of the incremental customer new customer I think you added this quarter.
First of all relative to last quarter for example.
Yes, Okay, Okay, and then I guess I think it is.
I mean.
Looking at the business and I think that it will be sort of the discussion. We've had this morning around sort of various sort of.
I mean supply chain issues on the customer side and getting at the instrumentation and then I think sort of Q3 in general being a months, where a lot of the world is sort of away on holiday for a good part of the quarter.
So looking at sort of the sequential growth Q3 over Q2.
Might be not be completely representative so I think where we get sort of comfort in sort of the traction on the explore externalization is looking at in order to conversations and discussions we have with customers.
Pipeline of customers and installations for Q4.
Ending the year up to call alluded to.
But we would expect it to be at the start of the year and setting us up for 2022.
Okay Gotcha.
And then just on the for the Q1 hundred Youre seeing strong demand. There I was curious if you are seeing.
<unk>.
The demand is likely coming funded.
<unk> target.
And focused customer or.
If there are significant.
Coming from.
Yes.
Old anchor new PEO technology customer and if so then what's kind of driving the take along what kind of where we're segmenting. The market you are seeing the.
The greatest demand.
Wholesale.
Yes.
You wanted to add.
Yeah, sorry, yeah. So.
We are seeing.
Very balanced demand actually which is fantastic to see from customers who are either current users are have been prior service users and.
And then a large number of new customers as well.
And so demand is coming from it's actually incredibly diverse as well, which I think is encouraging so for customers looking to bring some of their programs in house.
From companies.
And suppliers service providers lifestyle Carter.
Walker CRO type services.
And then straight into sort of academic centers and core lab. So a great diversity of interest in the platform, which is what we expected to see and we think is a great statement for.
The flexibility of the technology and sort of various and various outlets.
Net net all great for our end users because of this.
Opens up the capabilities.
I think we do a we think we do a terrific job with our services, but of course someone like sell cards on who is clear Cath labs.
And other labs will have other unique capabilities.
I think just opens up a world of opportunity for our end users. So we're very excited about that.
Got it great and then if I could squeeze one more in.
Great to see their first major data delivery.
K biobank.
Wondering kind of what's the timeline in terms of when we can expect.
<unk> data presentation coming.
Coming out of our proteomics data set.
Yes.
Yes, and we are excited about.
<unk>.
Yes.
The first 500 proteins, we plan to deliver the data this year.
And you can buy a bank has a known internal QC process and the data will be shared with the 13 biopharma companies meant towards the end of this year.
They have a nine month exclusivity looking at the data.
And after that it would be published publicly so you should expect that.
Then towards the beginning of the fourth quarter and next year and when we expand to the <unk> will be a very similar process. When we delivered the last dataset.
The nine month clock starts again and before those state that get published.
In the public domain as well.
Great. Thank you so much.
At this time there are no further questions.
Okay. Thanks, operator, and thank everyone for joining us today and for your interest in <unk>.
We look very much forward to keeping you updated on our progress advancing proteomics, while also enhancing shareholder value.
Are very excited to speak with you again at our Investor day in a few days so have a great day, everyone and thanks for attending.
Thank you for participating in today's conference call you may now disconnect.
Okay.
Yeah.
[music].