Q1 2024 Quanterix Corp Earnings Call

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Operator: Good day, and thank you for standing by. Welcome to the Quanterix Corporation Q1 2024 Earnings Call 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. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker for today, Francis Pruill, Director of Investor Relations. Please go ahead.

Good day, and thank you for standing by.

Speaker Change: Welcome to the one parent Corporation Q1, 'twenty 'twenty four earnings call Conference call.

Speaker Change: At this time all participants are in a listen only mode.

Speaker Change: After the Speakers' presentation, there will be a question and answer session.

Speaker Change: To ask a question. During this session you will need to press star one one on your telephone you will then hear an automated message advising that your hand is raised.

Speaker Change: To withdraw your question. Please press star one one again.

Speaker Change: Please be advised that today's conference is being recorded.

Speaker Change: I would now like to hand, the conference over to your first speaker for today.

Investor Relations: <unk> pool of Investor Relations. Please go ahead.

Francis Pruill: Thank you, and good morning. With me on today's call are Masoud Toloue, Quanterix's President and CEO, as well as Vandana Sriram, our Chief Financial Officer. Before we begin, I would like to remind you of a few things. This call will be recorded, and a replay will be available in the Investor Relations section of our website. Today's call will contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act.

Investor Relations: Thank you and good morning.

Speaker Change: With me on today's call are Mr. <unk>, <unk>, President and CEO as well as Rhonda, Sri Robb, our Chief Financial Officer.

Speaker Change: Before we begin I would like to remind you of a few things.

Speaker Change: Call will be recorded and a replay will be available on the Investor Relations section of our website.

Francis Pruill: These forward-looking statements are based on management's beliefs and assumptions and on information available as of the date of this call. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties, assumptions, and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statement. The risks and uncertainties that we face are described in our most recent filings with the Securities and Exchange Commission.

Speaker Change: Today's call will contain forward looking statements within the meaning of the US Private Securities Litigation Reform Act.

Speaker Change: These forward looking statements are based on management's beliefs and assumptions.

Speaker Change: Information available as of the date of this call.

Speaker Change: We may not actually achieve the plans intentions or expectations disclosed in our forward looking statements.

Speaker Change: Forward looking statements involve known and unknown risks uncertainties assumptions and other factors that may cause our actual results performance or achievements to be materially different from any future results performance or achievements expressed or implied by the forward looking statements.

Speaker Change: The risks and uncertainties that we face are described in our most recent filings with Securities and Exchange Commission.

Francis Pruill: To supplement our financial statements presented on a GAAP basis, we have provided certain non-GAAP financial measures. These non-GAAP measures are used to evaluate operating performance in a manner that allows for meaningful period-to-period comparison and analysis of trends in our business. We believe that such measures are important in comparing current results with other periods' results and are useful in assessing our operating performance. However, non-GAAP financial information presented herein should be considered in conjunction with, not as a substitute for, the financial information presented in accordance with GAAP.

Speaker Change: To supplement our financial statements are presented on a GAAP basis, we have provided certain non-GAAP financial measures.

Speaker Change: These non-GAAP measures are used to evaluate operating performance in a manner that allows for a meaningful period to period comparison and analysis of trends in our business we.

Speaker Change: We believe that such measures are important in comparing current results with other periods results and are useful in assessing our operating performance.

Speaker Change: non-GAAP financial information presented herein should be considered in conjunction with <unk>.

Speaker Change: As a substitute for the financial information presented in accordance with GAAP.

Francis Pruill: Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures set forth in the appendix of the presentation posted on our website and in the earnings release issued today. Finally, any percentage changes we discuss will be on a year-over-year basis unless otherwise noted. Now, I'd like to turn the call over to Masoud Toloue. Thank you.

Speaker Change: Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures set forth in the appendix of the presentation posted to our website and in the earnings release issued today.

Speaker Change: Finally, any percentage changes, we discussed will be on a year over year basis, unless otherwise noted.

Speaker Change: Now I'd like to turn the call over to Ms till it.

Masoud Toloue: Starting with our first quarter results, total revenue of $32 million grew 13%. This strong performance was driven by 22% growth from our consumables business and 57% growth in our accelerator lab, more than offsetting softness in instrument revenue, which was anticipated due to a challenging capital environment. Our accelerator lab continues to provide a nice buffer against these macro CAPEX headwinds. The lab has completed over 2,300 projects for more than 480 customers from all over the world using our Simola platform.

Ms Till: Thank you Francis.

Ms Tillit: Starting with our first quarter results total revenue of $32 million grew 13%.

Ms Tillit: This strong performance was driven by 22% growth from our consumables business and 57% growth in our accelerator lab more than offsetting softness in instrument revenue, which was anticipated due to a challenging capital environment.

Ms Tillit: Excited our lab continues to provide nice buffer to these macro capex headwinds. The lab has completed over 'twenty 300 projects for more than 480 customers from all over the world using our smaller platforms.

Masoud Toloue: First quarter non-GAAP gross margin of 54.5% grew approximately 140 basis points, and our balance sheet remains strong with $305 million of liquidity. Our cash usage in the period was approximately $19 million, which was higher than the prior year given the timing of certain working capital items.

Ms Tillit: First quarter non-GAAP gross margin of 54, 5% grew approximately 140 basis points and our balance sheet remains strong with $305 million of liquidity.

Ms Tillit: Our cash usage in the period was approximately $19 million, which was higher than the prior year given timing of certain working capital items.

Masoud Toloue: Vandana will touch on these results in more detail later in the call. Moving on from the quarter's financial performance, I'll expand on our leadership and innovation, focusing on new asset development and the durable moat advantaged by our incredible, sensitive Samoa technology. Simoma provides researchers the ability to examine and detect critical proteins at ultra-low levels with digital, single-molecule readouts. Breaking sensitivity barriers is a key reason why we've been a pioneer in the discovery of biomarkers and a trusted partner to our pharma and academic customers, as evidenced by more than 2,900 publications.

Ms Tillit: And then I will touch on these results in more detail later on the call.

Speaker Change: Moving on from the quarter's financial performance I will expand on our leadership and innovation.

Speaker Change: Focusing on new assay development and the durable note advantaged by our incredible sensitive similar technology.

Speaker Change: Similar provides researchers the ability to examine and detect critical proteins at ultra low levels with digital single molecule readout.

Speaker Change: Breaking sensitivity barriers as a key reason why we've been we've been a pioneer in the discovery of Biomarkers and a trusted partner to our pharma and academic customers evidenced by more than 2900 publications.

Masoud Toloue: Building on the foundation our incredible team has built over the last year and a half, we have a new product development. We remain on target to introduce approximately 20 new biomarker assays by the end of the year in the areas of neurology, immunology, and oncology. First, we're working on a comprehensive approach for Parkinson's disease, a neurological disorder that impacts millions of people around the world. There remains a critical need to identify treatment pathways to slow the disease's progression over time, with nearly 140 Parkinson's therapies in active clinical trials.

Speaker Change: Building on the foundation, our incredible team has built over the last year and a half we have a new product development engine.

Speaker Change: We remain on target to introduce approximately 20, new biomarker assays by the end of the year and the areas of neurology immunology and oncology.

Speaker Change: First we are working on a comprehensive approach.

Speaker Change: For Parkinson's disease, and neurological disorder that impacts millions of people around the world.

Speaker Change: There remains a critical need to identify treatment pathways to slow the disease progression over time with nearly 140 pockets and therapies in active clinical trials.

Masoud Toloue: To date, biomarkers such as NSL and GFAP have been implemented as key tools to monitor Parkinson's disease development. For example, in the January publication of the scientific journal Nature, researchers used Quanterix's NFL assay to measure whether late-stage Parkinson's disease is associated with an increase in neurodegeneration. However, this is only the beginning.

Speaker Change: To date, Biomarkers, such as NFL and <unk> have been implemented as key tools to monitor Parkinson's disease development.

Speaker Change: For example in January publication of the scientific Journal nature, researchers used <unk> NFL assay to measure whether late stage Parkinson's disease is associated with an increase in neuro degeneration.

Speaker Change: However, this is only the beginning.

Masoud Toloue: Last month, we launched our sTREM2 assay, a microglial marker implicated in Parkinson's and other diseases, and we continue to focus on clinically relevant forms of alpha-synuclein and lysosomal storage biomarkers. These are important efforts requiring Samoa-level sensitivity and supported by our partners such as the Michael J. Fox Foundation.

Speaker Change: Last month, we launched our <unk> assay, a mitral glial marker implicated in Parkinson's and other diseases and we continue to focus on clinically relevant forms of alpha nucleon lysosomal storage biomarkers.

Speaker Change: These are important efforts requiring some our level of sensitivity and supported by our partners such as the Michael J Fox Foundation.

Masoud Toloue: Turning next to a biomarker that has garnered a significant amount of recent attention, tau. The Alzheimer's disease research community is just getting started in holistically evaluating this powerful protein and its many phospho isoforms. Quanterix has been the leader pushing forward the measurement and correlative data behind the evolution of tau biomarkers, not only with P-tau-181 and P-tau-217 but also for less discussed markers such as P-tau-205, 212, and 231. Each of these specific isoforms may have unique characteristics that are useful in a diagnostic setting with the potential to improve clinical utility if included in a multi-marker Today, the NIA recommends PTAL 217 as the best biomarker for accurately diagnosing amyloid pathology. However, progress with TAO does not end with PTAO 217.

Speaker Change: Turning next to our biomarker that has garnered a significant amount of recent attention Tao.

Speaker Change: The Alzheimer's disease research community is just getting started and holistically evaluating as powerful protein and its many fosco isoforms.

Speaker Change: <unk> has been the leader pushing forward the measurement and correlated data behind an evolution of Tau Biomarkers not only with <unk> 81, and <unk> 2017, but also for less discussed markers such as <unk> 205, $2 12, and $2 31.

Speaker Change: Each of these specific isoforms may have unique characteristics that are useful in a diagnostic setting with the potential to improve clinical utility if included in a multi marker assay.

Speaker Change: Today, the Nia AA recommends P till 2017, as the best biomarker for accurately diagnosing amyloid pathology.

Speaker Change: However, our progress with Kao does not end with pretax 17 Kwan.

Masoud Toloue: Quanterix is leading the way to develop further evidence that more specific biomarkers and robust panels of related brain-specific analytes may add diagnostic sensitivity to the detection and monitoring of Alzheimer's disease. In an April Nature publication, researchers led by a group from the University of Gothenburg in Sweden, using our Samoa technology, determined that Brain Derived Tau, or BD Tau, is a marker that has elevated levels in the presence of amyloid beta pathology and may provide additive sensitivity to a standalone pTau 217 assay. Studies suggest that blood total tau originates principally from peripheral non-brain sources.

Speaker Change: <unk> is leading the way to develop further evidence that more specific biomarkers and robust panels of related brain specific analytes may add diagnostic sensitivity to the detection and monitoring of Alzheimer's disease.

Speaker Change: And in April nature publication, researchers led by group from the University of Gothenburg in Sweden, using our <unk> technology determined that brain derived tau or BD Tau as a marker that is elevated levels in the presence of amyloid beta pathology and may provide additive sensitivity.

Speaker Change: Standalone <unk> assay.

Speaker Change: Studies suggest that blood total tau originates principally from peripheral non brain sources.

Masoud Toloue: However, BD Tau comes directly from the brain instead of elsewhere in the body and therefore may offer greater precision compared to the current standard of measurement. BD Tau may improve the current ATM framework for the definition and staging of Alzheimer's disease. We believe this is an important advancement in the field and plan to release our BD Tau assay this quarter. Meanwhile, staying on Alzheimer's disease, our development of a multi-marker test continues to progress.

Speaker Change: However, BD Tao.

Speaker Change: <unk> directly from their brain instead of elsewhere in the body and therefore may offer greater precision compared to the current standard of measurement.

Speaker Change: BD talent improve the current ATM framework for the definition and staging of Alzheimer's disease.

Speaker Change: We believe this is an important advancement in the field and plan to release, our <unk> assay this quarter.

Speaker Change: Staying on Alzheimer's disease or development of our multi marker test continues to progress.

Masoud Toloue: More specifically, we plan to present four abstracts using data from the BioHermes and Kentate trials in support of this effort at the upcoming Alzheimer's Association International Conference in late July. As a reminder, BioHermes is a diverse perspective study across 17 domestic sites, enrolling approximately 1,000 participants, with 200 from underrepresented populations.

Speaker Change: More specifically, we plan to present four abstracts using data from the bio Hermes and cantata trials in support of this effort at the upcoming Alzheimer's Association International Conference in late July.

Speaker Change: As a reminder, <unk> Hermes has a diverse prospective study across 17 domestic sites enrolling approximately 1000 participants with 200 from underrepresented populations.

Masoud Toloue: And Kintate is a multi-year, multi-phase study. Phase one of the study encompassed 1,200 retrospective samples. And phases two and three, of which we're currently engaged, are targeting 1,200 prospective enrollees across memory clinics. In addition to using these data for a multi-marker test, results from Bioharmes and Kentate have been used for clinical validation of our LUCIN-AD P-Tau 217 assay. Moving now to progress in the field of Alzheimer's diagnostics, during Q1, we announced that our PTaU 217 blood test was granted breakthrough designation by the FDA. In February, the American Medical Association confirmed new CPT codes for amyloid beta-40, amyloid beta-42, phospho-tau, and total-tau. We expect CMS to price these codes later in the year.

Speaker Change: And Kentucky is a multiyear multi phased study phase one of this study encompassed 200 retrospective samples and phases, two and three of which were currently engaged are targeting 200 prospective enrollees across memory clinics and primary care settings.

Speaker Change: In addition to using these data for a multi marker test results from bio armies in Kentucky have been used for clinical validation of our loosen.

Speaker Change: Pete how 2017 assay.

Masoud Toloue: Finally, we are pleased to highlight our collaboration announced in 2022, which resulted in Eli Lilly's launch of SIRTUIT-AD, a blood test that can provide additional diagnostic evidence for Alzheimer's disease, measuring p-tau 217 and run on Quanterix's SPX platform. Moving next to recent events.

Speaker Change: Shifting now to progress in the field of Alzheimer's diagnostics.

Speaker Change: During Q1, we announced that our <unk> blood test was granted breakthrough designation by the FDA.

Speaker Change: In February the American Medical Association confirmed new CPT codes for amyloid beta 40 amyloid.

Speaker Change: Lloyd beta of 42 fossil Tau and total Tau.

Speaker Change: We expect CMS to price. These codes later in the year.

Speaker Change: Finally, we are pleased to highlight our collaboration announced in 2022 as a resulted in Eli Lilly's launch of <unk>.

Speaker Change: A blood test that can provide additional diagnostic evidence for alzheimers disease, measuring <unk> 2017, and run on <unk> SPX platform.

Speaker Change: This test is now available to it.

Speaker Change: Dot com.

Speaker Change: Moving next to recent events in the last several weeks a few new plasma <unk> 17, and <unk> have entered the market with varying levels of validation and approaches for interpreting results.

Masoud Toloue: In the last several weeks, a few new Plasma PTAU 217 LDTs have entered the market with varying levels of validation and approaches for interpreting results. While it is still early, this suggests several platforms will serve different use cases in the market. Currently, we believe there are three Ptau 217 tests available clinically that meet the Alzheimer's Association Working Group recommendations of 90% accuracy. Two of these three tests use Quanterix's SEMOA technology, and as such, have been thoroughly validated through well-powered clinical studies. Preliminary results have been presented at recent technical conferences, and journal publications are expected later this year.

Speaker Change: While it is still early to suggest several platforms will serve different use cases in the market.

Speaker Change: Currently we believe there are three <unk> tests available clinically that meet the Alzheimer's Association working group recommendations of 90% accuracy.

Speaker Change: Two of these three tests used <unk> as some of our technology and as such have been thoroughly validated through well powered clinical studies.

Speaker Change: Preliminary results have been presented at recent technical conferences and journal publications are expected later this year.

Masoud Toloue: We're not aware of any immunoassay that provides higher sensitivity than Quanterix's Samoa technology. The ability to precisely measure PTAL217 at very low levels ensures the ability to deliver clinically meaningful results across a range of use cases. Reportable concentrations can be provided for 100% of patients, even those at the very earliest stages of disease.

Speaker Change: We're not aware of any immunoassay that provides higher sensitivity and quantity <unk> technology.

Speaker Change: The sensitivity to precisely measure of <unk> 2017 at very low levels ensures the ability to deliver clinically meaningful results across a range of use cases.

Speaker Change: First <unk>.

Speaker Change: Reportable concentrations can be provided for 100% of patients even those at the very earliest stages of disease.

Masoud Toloue: LUCENT-AD-PTAP-2017 has a single femtogram per mil limit of detection, and Quanterix has yet to encounter a single sample unreasonable below this level in over 2,000 samples tested, including the Biohermes and VUMC cohorts and hundreds of Healthy Control participants. In similar patient cohorts, other technology platforms have shown up to 30% of samples were unreadable below the platform detection limit. Second, based on results from recent therapeutic trials, it has been shown that individuals at the earliest stages of the disease experience the greatest benefit from therapy; early detection is enabled by IR sensitivity.

Speaker Change: <unk> <unk> <unk>.

Speaker Change: 2017, as a single dose.

Speaker Change: <unk> gram per mile limit of detection and <unk> has yet to encounter a single sample unreasonable below this level in over 2000 samples tested including the Bible Hermes and V UMC cohorts.

Speaker Change: And hundreds of healthy control participants.

Speaker Change: And similar patient cohorts other technology platforms have shown up to 30% of samples were unreadable below the platform detection limit.

Speaker Change: Second.

Speaker Change: Based on results from recent therapeutic trials and has been shown that individuals at the earliest stages of the disease experience the greatest benefit from therapies.

Speaker Change: Early detection is enabled by higher sensitivity.

Masoud Toloue: Third, there is emerging potential to track progression or response to therapy by monitoring tau levels. In any monitoring application, you want to start measuring early and continue to follow the patient as the disease progresses. Resolving small changes at the lowest levels is not only important for early intervention but also provides confirmation when therapeutic benefit has been achieved. We believe the TAM for testing is large, and the infrastructure will be built by several amino acid providers. We believe the CIMO platform will be uniquely competitive for these applications due to its sensitivity.

Speaker Change: Third.

Speaker Change: There is emerging potential detract progression or response to therapy by monitoring titled levels.

Speaker Change: And any monitoring application do you want to start measuring early and continue to follow that patient as the disease progresses.

Speaker Change: Resulting small changes at the lowest levels is not only important for early intervention, but also provides confirmation therapeutic benefit hasn't been achieved.

Speaker Change: While we believe the Tam for testing is large and infrastructure will be built by several immunoassay providers.

Speaker Change: We believe the <unk> platform will be uniquely competitive for these applications due to its sensitivity.

Masoud Toloue: We are expanding on this foundation with multi-marker, multiplexed testing that other platforms are unable to perform. Multi-marker testing has the potential to bring definitive results to a larger proportion of patients, as well as provide guiding information for differential diagnosis of non-AD dementia. As we see therapies advance, anti-tau therapies will require independent measurement of tau pathology and amyloid pathology to understand how combination therapy should be managed. This requires examination of multiple markers to improve amyloid detection and support diagnosis. We look forward to sharing updates on our progress in the coming weeks. With that, I'll turn the call over to Vandana to discuss our financial results.

Speaker Change: We are expanding on this foundation with multi marker multiplex testing.

Speaker Change: At other platforms are unable to perform.

Speaker Change: Multi marker testing has the potential to bring definitive results to a larger proportion of patients as well as provide guiding information for a differential diagnosis of dementia.

Speaker Change: As we see therapies advance anti Tau therapies will require independent measurement of Tau pathology.

Speaker Change: And amyloid pathology to understand how combination therapy should be managed.

Speaker Change: This requires examination of multiple markers to improve amyloid detection and support diagnosis.

Speaker Change: We look forward to sharing updates on our progress in the coming months.

Speaker Change: With that I'll turn the call over to London to cover our financial results.

Vandana Sriram: I will now add color to our first quarter results and also expand on our reiterated guidance for 2020. As Masoud described, Q1 was a solid quarter and consistent with our plan. We are pleased with the momentum we have.

London: Thank you masoud.

London: Now add color to our first quarter results.

London: Russ will expand on our reiterated guidance for 2024.

London: As Michael described Q1 was a solid quarter and consistent with our plan. We are pleased with the momentum we have to start the year.

Vandana Sriram: Total revenue for the first quarter of 2024 was $32.1 million, an increase of 13% compared to the prior year. Accelerator Lab revenue was $8.7 million, an increase of 57%, as customer appetite for our in-house CLIA Lab services remains strong. Consumables revenue was $17.1 million, an increase of 22%, and instrument revenue was $2.5 million, a decrease of 52%. In terms of revenue stratification, our customer mix during the period was nearly 50-50 between academia and pharma. And 85% of our assay and accelerator sales were for neurological disease states.

London: Total revenue for the first quarter of 2024 was 30.

London: $32 1 million, an increase of 13% compared to the prior year.

London: Accelerator lab revenue was $8 7 million, an increase of 57% as customer appetite for our in house CLIA Lab services remained strong.

London: Consumable revenue was $17 1 million.

London: The increase of 22%.

London: Instrument revenue was $2 5 million a decrease of 52%.

London: In terms of revenue stratification, our customer mix in the period was nearly 50 50 between academia and pharma.

London: At 85% of our assay and accelerated sales both with neurology disease state.

Vandana Sriram: For the quarter, our total installed base increased by a net of 16 instruments. As others have noted, the capital budget environment remains challenging; however, we are seeing healthy demand from our accelerator lab to offset this weakness. Moving next to gross margin for Q1, Gap gross profit and margin were $19.6 million and 61.2%, respectively, up 2.7 million and approximately 170 basis points compared to the prior year. First quarter non-GAAP growth profit was $17.5 million, and the non-GAAP growth margin was 54.5%.

London: For the quarter, our total installed base increased by a net 16 instruments.

London: As others have noted the capital budget environment remains challenging. However, we are seeing healthy demand from our accelerator lab to offset this weakness.

London: Shifting next to gross margin for Q1.

London: GAAP gross profit and margin were $19 6 million and 61, 2% respectively.

London: $2 7 million and approximately 170 basis points compared to the prior year.

London: First quarter non-GAAP gross profit was $17 5 million and non-GAAP gross margin was 54, 5% up $2 4 million and 140 basis points, respectively compared to the first quarter of 2023.

Vandana Sriram: Up 2.4 million and 140 basis points, respectively, compared to the first quarter of 2020. Expanding on gross margin for a moment, our non-gap gross margin improved considerably on a sequential basis, up approximately 800 basis points compared to the fourth quarter of 2023. We're pleased with this performance, as we more efficiently managed inventory in the period, achieved higher pricing, and continue to see the benefits of our corporate transactions.

London: Expanding on gross margin for a moment, our non-GAAP gross margin improved considerably on a sequential basis.

London: Approximately 800 basis points compared to the fourth quarter of 2023, we're pleased with this performance as be more efficiently managed inventory in the period achieved higher pricing and to continue to see the benefits of our corporate transformation.

Vandana Sriram: Moving down the P&L, first quarter GAAP operating expenses were $33.6 million, an increase of $7.2 million compared to the prior year. Non-GAAP operating expenses were $31.4 million, an increase of $6.9 million compared to Q1. Within operating expenses, higher spending compared to the prior year was primarily due to investments we continue to make in our R&D and commercial areas. Moving to the balance sheet, we ended the first quarter of 2024 with $304.5 million in cash, cash equivalents, marketable securities, and restricted cash.

London: Moving down the P&L first quarter GAAP operating expenses were $33 6 million, an increase of $7 2 million compared to the prior year.

London: non-GAAP operating expenses were $31 4 million, an increase of $6 9 million compared to Q1 'twenty three.

London: Within operating expenses higher spending compared to the prior year was primarily due to investments we continue to make in our R&D and commercial effort.

London: Moving to the balance sheet. We ended the first quarter of 2024 with $304 5 million of cash cash equivalents marketable securities and restricted cash.

Vandana Sriram: Cash flow in the period was a net outflow of 19.4 million. Q1 historically is our quarter with the largest cash outlay given the timing of bonus payments, which were an outflow of $7 million in the period. In addition, the quarter's cash results were impacted by the timing of receivables and inventory. Receivables were up $4 million due to the timing of revenue versus billings, and inventory was higher by nearly $4 million to support our growth initiatives.

London: Cash flow in the period was a net outflow of $19 4 million.

Speaker Change: Q1 for US historically is our quarter with the largest cash outlay, given the timing of bonus statements, which was an outflow of $7 million in the period.

London: In addition, the quarter's cash it's also impacted by the timing of receivables and inventory.

London: Receivables were up $4 million due to the timing of revenue billings and.

London: <unk> was higher by nearly $4 million to support our growth initiatives.

Vandana Sriram: Our liquidity remains strong and provides excellent flexibility in what remains an uncertain funding environment. Moving on from the first quarter, our full year 2024 outlook is unchanged, with a revenue range of $139 to $144 million and a long gap gross margin profile in the low to mid 50s. As a reminder, this guidance does not include revenues from diagnostics testing, which were immaterial in the first quarter. We expect the pacing of our revenue and gross margin throughout the year to be, in part, dependent on the rollout of our new Advantage Plus assays, as well as customers switching to these new products.

London: Our liquidity remains strong and provides excellent flexibility in what remains an uncertain funding environment.

London: Moving on from the first quarter, our full year 2024 outlook is unchanged with a revenue range of 139 to 144 million and a non-GAAP gross margin profile in the low to mid <unk>.

London: As a reminder, this guidance does not include revenues from diagnostics testing, which were immaterial in the first quarter.

London: We expect the phasing of our revenue and gross margin throughout the year to be in part dependent on the rollout of our new advantage plus assays as well as customer switching to these new product.

Vandana Sriram: We are still in the early stages of this activity and expect the sequencing of revenue to be weighted to the second half of the year. In our guidance, we continue to assume cash usage between $25 to $30 million, which assumes approximately $20 million of investments in strategic initiatives, such as ramping up our commercial capabilities in diagnostics and in product innovation. I will now turn it back over to Masoud for his final. Thank you, Vandana.

Vandana Sriram: We are still in early stages of this activity and expect the sequencing of revenue to be weighted to the second half of the year.

Masoud Toloue: And in our guidance, we continue to assume cash usage between $25 million to $30 million, which assumes approximately $20 million of investments in strategic initiatives, such as ramping up our commercial capabilities in diagnostics and in product innovation.

I will now turn it back over to MS. Lu for his final comments.

Masoud Toloue: Our principal framework remains creating tools to enable discovery and improve health outcomes. This is a Quanterix commitment to product innovation. We're working towards pushing beyond the industry standard we set for ultrasensitivity. Approaching the Foundries of Physics and Improving Plex Across New Sets of Protein Biomarkers This year, we're making significant investments in menu, technology, and diagnostic testing. We're doing this with a new operating model that effectively scales, and we expect to realize operating leverage as we drive toward profitability.

Masoud Toloue: Thank you Rhonda.

Masoud Toloue: Our principal framework remains creating tools to enable discovery and improve health outcomes.

Masoud Toloue: This is a quant terex commitment to product innovation.

Masoud Toloue: We're working towards pushing beyond the industry standards, we set for ultra sensitivity.

Masoud Toloue: Approaching the boundaries of physics, and improving plex across new sets of protein biomarkers.

Masoud Toloue: This year, we're making significant investments in menu technology and diagnostic testing.

Masoud Toloue: We're doing this with a new operating model that effectively scales and expect to realize operating leverage as we drive toward profitability.

Masoud Toloue: Our ability to identify new markers, translate these analytes into assays for research, and now into clinical applications is unparalleled. Neurology is on the doorstep of the next era of exciting discovery, and Quanterix is poised to help unlock this opportunity.

Masoud Toloue: Our ability to identify new markers translate these analytes into assays for research and now into clinical applications is unparalleled.

Masoud Toloue: <unk> is on the doorstep of the next era of exciting discovery and <unk> is poised to help unlock this opportunity.

Speaker Change: We can now take some questions.

Operator: At this time, we will conduct our question and answer session. As a reminder, to ask a question, you will need to press star one on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. We do ask all participants to limit themselves to one question and one follow-up. Please stand by while we compile the Q&A roster. Our first question comes from the line of Puneet Souda of Lear, Inc. Partners. Your line is now open.

Speaker Change: Thank you.

Speaker Change: At this time, we will conduct a question and answer session.

Operator: As a reminder to ask a question you will need to press star one one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one one again, we do ask all participants to limit themselves to one question and one follow up please standby.

Operator: While we compile the Q&A roster.

Puneet Souda: Our first question comes from the line of permit Suiter of Leerink Partners. Your line is now open.

Puneet Souda: Hey guys, thanks for taking the time to answer my questions. So first one on the accelerator growth that you're seeing here. Can you talk a little bit about, you know, if there is some contribution from sort of biotech funding picking up in the first quarter? Are you seeing some of that come in? What sort of things is contributing? Is it just a large, you know, you pointed out neurology, obviously being the driver, but just maybe talk to us about what's driving that growth? How sustainable is that? And should we expect the 20 new biomarker assays to be contributing to the growth that an accelerator services through the year as well?

Puneet Souda: Hey, guys. Thanks for taking my questions. So first one on the accelerator growth that youre seeing here.

Puneet Souda: Can you talk a little bit about.

Puneet Souda: If there is some contribution from sort of biotech funding.

Puneet Souda: Picking up in the first quarter or are you seeing some of that come in what sort of is contributing is it just a large.

Puneet Souda: You pointed out the neurology, obviously being the being the driver, but just maybe talk to us about what's driving that growth how sustainable is that and should we expect that the 20, new biomarker assays.

Puneet Souda: To be contributing to the growth that its an accelerator services through the year as well.

Masoud Toloue: Yeah, so, you know, Accelerator has been a great story. As you know, we've built a lot of testing capacity and scale in the business. We got, you know, a 50% improvement in our testing scale. We're currently able to look at 750,000 tests with the capacity to increase threefold. So we built that seeing that there was a lot of interest in neurotrials over the last year or so, and they continue to be strong. So I think most of that growth has come from pharma versus some of the smaller biotech, and 80% of that has been from reoccurring customers.

Bonnie: Hey, Bonnie.

Puneet Souda: So it's been a great story.

Masoud Toloue: As you know we built a lot of <unk>.

Masoud Toloue: Testing capacity and scale in the business, we have 50% improvement in our testing scale.

Masoud Toloue: We're currently able to looking at 750000 tests with.

Masoud Toloue: With capacity to increase threefold. So we built that seeing that there's a lot of interest in neuro trials over the last year or so and they continue to be strong. So I think most of that growth has come from pharma versus some of the smaller biotech.

Masoud Toloue: And 80% of that has been a reoccurring customers. So we have a pretty decent visibility into projects coming into the.

Masoud Toloue: So we have pretty decent visibility into projects coming into the accelerator group and remain very excited about the prospect of additional work there. For the assays, one of the great parts of Accelerator that we're very thrilled about is, you know, we get with our customers, we get to sit down, and we have an early perspective of the important markers for future clinical trials and future neurology projects.

Masoud Toloue: Accelerated our group and remain very excited about the prospect for additional work there.

Masoud Toloue: On the on the assays.

Masoud Toloue: One of the great parts of accelerator that we're very thrilled as we get with our customers we get to sit down and we have early perspective, the important markers for future clinical trials and future neurology projects and we work there and collaboration and.

Masoud Toloue: And, you know, we work there in collaboration, and that work does feed our product pipeline, our kit and assay pipeline. And as we develop assays, it helps with, you know, clinical trials. So it's a strong flywheel that has been great for the business.

Masoud Toloue: That work does feed our product pipeline, our kit and assay pipeline.

Masoud Toloue: And as we develop assays it helps with clinical trials.

Masoud Toloue: A strong flywheel.

Masoud Toloue: <unk> flywheel.

Masoud Toloue: Great for the business.

Puneet Souda: Got it. And then you talked a little bit about competitive dynamics. I mean, recently there was a large peer in diagnostics that also announced their breakthroughs for P-Tau 217, I believe. And can you elaborate on how you're thinking about the competition for SEMOA? How SEMOA will differentiate itself and HDX will differentiate itself versus what appears to be more, you know, automated high-throughput systems to serve the Alzheimer's, you know, diagnostics market.

Speaker Change: Got it and then.

Puneet Souda: You talked a little bit about competitive dynamics I mean recently there was a large.

Puneet Souda: Pier in diagnostics that also announced a breakthrough it's for Pete out to 17, I believe and can you elaborate how youre thinking about.

Puneet Souda: <unk>.

Puneet Souda: The competition for the house.

Puneet Souda: How similar will differentiate itself in HD X.

Puneet Souda: Will differentiate itself.

Puneet Souda: First is what appears to be more.

Puneet Souda: Automated high throughput systems.

Puneet Souda: To serve the Alzheimer's Alzheimer's diagnostics market.

Masoud Toloue: Yeah, so I think it comes down to two key points, and I'll expand on that, but the first point is, you know, sensitivity. You know, the Quanterix platform, and the Simo technology just has, you know, incredible sensitivity that, you know, a lot of other platforms just can't match. And the second is our ability to multiplex, and those two technological features really open up a lot of doors.

Speaker Change: Yes, so I think it comes down to.

Masoud Toloue: Two key points and I'll expand on that but the.

Masoud Toloue: The first point is sensitivity.

Masoud Toloue: Sensitivity.

Masoud Toloue: We the <unk> platform some of our technology, just has incredible sensitivity that and a lot of.

Masoud Toloue: Other platforms, just can't match and the second is our ability to multiplex.

Masoud Toloue: <unk>.

Masoud Toloue: Those two technology.

Masoud Toloue: Technology features really open up a lot of doors. So first.

Masoud Toloue: So first, you know, our limit of detection really is in the single femtogram, you know, per mil limited detection. You know, when we look at patient samples or patients, we don't get an unreadable result. And so, you know, we had a nice diagram where we're showing that, you know, the Quanterix platform, although there hasn't been clinical data or a lot of clinical data out there with new platforms, we've put a lot of clinical data, but other platforms haven't seen that clinical data.

Masoud Toloue: Our limit of detection.

Masoud Toloue: It really is in the single.

Masoud Toloue: Graham.

Masoud Toloue: Per mill limited detection and when we look at the patient samples of our patients.

Masoud Toloue: We don't get a unreasonable result.

Masoud Toloue: So we had a nice diagram, we're showing the.

Masoud Toloue: <unk> platform, although there hasnt been clinical data, where a lot of clinical data out there with new platforms.

Masoud Toloue: Put a lot of clinical data, but other platforms havent seen that clinical data if you give full credit to.

Masoud Toloue: If you give full credit to, you know, let's say the results, I would expect competitor platforms to perform, you know, Similarly, with patients that have signs or are symptomatic of Alzheimer's disease, and that's, you know, one portion of that market. The issue is that when you look at, you know, situations in the clinic, you're not looking at a fixed cohort of patients that have the disease; you're looking at people in the very early stages, folks that have memory concerns but don't have amyloid pathology.

Masoud Toloue: Let's say the results I would expect competitor.

Masoud Toloue: <unk> to perform.

Masoud Toloue: Similarly, with patients that have science or symptomatic for Alzheimer's disease, and Thats, one portion of that market.

Masoud Toloue: Okay.

Masoud Toloue: The issue is is that you have when you look at situations in the clinic youre not looking at a.

Masoud Toloue: Fixed cohort of patients that have the disease youre looking at people at the very early stages folks that have memory concerns, but don't have amyloid pathology and so the clinical utility it is a very different.

Masoud Toloue: And so the clinical utility is a very different sort of situation than, you know, fixed studies. So you have patients coming in who have a very low result, may have memory concerns, and those results are not readable. And so we haven't missed a patient in any of our clinical trials. So that's number one.

Masoud Toloue: Sort of situation than fixed study. So you have patients coming in who have a very low result may have memory concerns and those.

Masoud Toloue: The results are not renewable.

Masoud Toloue: And so we haven't missed a patient in any of our clinical trials.

Puneet Souda: Number two, 30% of the symptomatic patients that are in the pipeline or that come because they have an issue don't have Alzheimer's disease. They have, you know, some other pathology and would benefit from a multi-marker test. And so we think there's a real opportunity there. We'll be talking about our multi-marker in a month or two at the AAIC conference. And then finally, progression of disease. And there was an interesting paper about APOE recently, a couple days ago, that came out.

Masoud Toloue: So that's number one number two.

Puneet Souda: 30% of the symptomatic patients that you that are in the pipeline or that come because they have an issue.

Puneet Souda: Don't have Alzheimer's disease.

Puneet Souda: They have.

Puneet Souda: Some other pathology and would benefit from a multi marker test and so we think theres a real opportunity there.

Puneet Souda: We'll be talking about our multi marker.

Puneet Souda: In a month or two at the AIC Conference and then finally progression of disease.

Puneet Souda: And there was interesting paper about.

Puneet Souda: E.

Puneet Souda: And recently a couple of days ago that came out and if youre measuring folks that have suspect our history. Our genetic history of the disease you need to measure someone who's early and you need to resolve changes early in the Cascade and so as disease progresses.

Puneet Souda: And if you're measuring folks that have, you know, suspect, or history or genetic history of the disease, you need to measure someone who's early, and you need to resolve changes early in the cascade. And so as the disease progresses, we think that you're going to need sensitivity for that as a person progresses through that disease cascade. So those are the three kind of main areas and why we think the similar platform is going to be, you know, have a leadership role in Alzheimer's.

Puneet Souda: We think that youre going to need sensitivity for that.

Puneet Souda: As a person progresses through disease.

Puneet Souda: Disease Cascade.

Puneet Souda: Those are the three kind of main areas and why we think that some of our platform is going to be have a leadership role in Alzheimer's testing.

Puneet Souda: Thanks, Masoud, for the context there. And if I could just squeeze one quick one in for Vandana, can you elaborate where the pricing improvement was coming from? And how should we expect the gross margin cadence through the year, specifically on pricing? Was it more RUO assays or accelerator side?

Speaker Change: Got it thanks, thanks for the context, there and if I could just squeeze one quick one in for one can you elaborate where the pricing improvement is coming from.

Puneet Souda: How should we expect the gross margin cadence.

Puneet Souda: Through the year, specifically on pricing was it more are you assays or accelerators side.

Vandana Sriram: Yeah, thanks for the question, Puneet. So, I'm really pleased with where we landed on gross margin for the quarter. On the pricing front, we implement an annual price increase every year that goes into effect at the beginning of the year. That's across all of our products. So you see that kind of across the portfolio. On the accelerator side, there's a little bit more bespoke project work that goes on. So there is a little more variability there.

Vandana Sriram: Yes. Thanks for the question Puneet, So really pleased with where we landed on gross margin for the quarter.

Vandana Sriram: The pricing front the implement an annual price increase every year that went into effect at the beginning of the year that's across all of our product.

Vandana Sriram: So you'll see that kind of across the portfolio on the exploration side Theres, a little bit more bespoke project work that goes on so there is a little more variability there and this quarter.

Vandana Sriram: And this quarter, the projects that we executed were very favorable from a pricing perspective and helped on the margin. So, you know, Paul, overall margin. So, we see really good things about the margin. The pricelist helped, the revenue mix also definitely helped out this quarter. And then a lot of the fixes that we put through in the transformation also have started.

Vandana Sriram: <unk> executed a very favorable from a pricing perspective and helped on the margin front.

Vandana Sriram: So overall Pos.

Vandana Sriram: Really good about the margin the price lift the revenue mix also definitely helped out this quarter and then a lot of the fixes that we put through in the transformation that with what I have started to take hold.

Puneet Souda: Got it. Okay. Thanks, guys. Thank you for your question. Please stand by.

Speaker Change: Got it okay. Thanks, guys.

Operator: Thank you for your question. Please stand by for our next question. Our next question comes from the line of Matt Sykes of Goldman Sachs. Your line is now open.

Speaker Change: Thank you for your question. Please standby for our next question.

Matthew Carlisle Sykes: Our next question comes from the line of Matt <unk> of Goldman Sachs. Your line is now open.

Matthew Carlisle Sykes: Good morning. Thanks for taking my questions. Maybe the first one for me, just looking at the instrument accelerator lab mix, how much of that do you think is due to the weaker capital equipment demand environment and customers just more willing to use accelerator labs? And if we do see an improvement in the capital equipment demand environment, do you expect that mix to shift back? Or are there some customers that have gotten used to the accelerator lab services and will be more willing to use them? And then, longer term, if that mix stays that way with accelerator lab growing at a faster rate, what is the impact on margins going forward?

Matthew Carlisle Sykes: Good morning, Thanks for taking my questions, maybe the first one.

Matthew Carlisle Sykes: For me just looking at the instrument accelerator lab.

Matthew Carlisle Sykes: Mix how much.

Matthew Carlisle Sykes: Of that do you think is due to the weaker capital equipment demand environment.

Matthew Carlisle Sykes: And customers just more willing to use accelerator lab and if we do see an improvement in the capital equipment demand environment do you expect that mix to shift back or there are some customers that have gotten used to the accelerator lab services and will be more willing to use and then longer term if that mix stays that way with accelerated lab.

Matthew Carlisle Sykes: Growing at a faster rate what is the impact on margins going forward.

Vandana Sriram: Yeah, thanks for the question, Matt. We think it's really both. You know, on the one hand, the accelerator product has become a really unique offering on its own. So we think there's a value proposition for it that stands on its own. And Masoud mentioned that about 80% of the customers are now repeat customers. So we feel like that will continue to grow. Maybe those growth rates won't be as high as they are right now, but we think that value crop stands on its own and will continue to have a really important place in our portfolio for many different reasons.

Speaker Change: Yes, thanks for the question Matt.

Vandana Sriram: We think it's really bolt on the one hand, the accelerator product has become a really unique offering.

Vandana Sriram: So we think theres a value prop for it that stands on its own and <unk> mentioned that about 80% of the customers are now repeat customers.

Vandana Sriram: We feel like that will continue to grow maybe those growth rate won't be as high as they are right now, but we think that value props stands on its own and will continue to have a really important place in our portfolio for many different reasons.

Vandana Sriram: On the instrument side, you know, certainly for this quarter, we definitely saw a lot of that CapEx pullback show up in Accelerator. So in the short term, that might be something that continues for another quarter or two, but our expectation would be, at some point, that balances out, and as the funding environment eases, we have both models running together where, you know, we are still selling instruments, but we still see Accelerator as a really viable solution.

Vandana Sriram: On the instrument side certainly for this quarter.

Vandana Sriram: <unk> saw a lot of that Capex pullback show its way in actual greater so in the short term that might be something that continues for another quarter or two but our expectation would be at some point that balances out and as the funding environment eases.

Vandana Sriram: We have both models running together.

Vandana Sriram: We are still selling instruments, but do you still see exploration as a very viable.

Vandana Sriram: Franchise.

Masoud Toloue: And Matt, the only other thing I would say is that, you know, when you think of Accelerator and you think of Samoa and the sensitivity that we offer, when we perform these services, they're, you know, large, they're margin accretive to the total business, meaning, you know, there's a valuable service that we offer with valuable technology, and, you know, and they're priced accordingly.

Speaker Change: And Matt the only other thing I would say is that when you think of accelerator.

Masoud Toloue: And you think the value of <unk> and the sensitivity that we offer.

Masoud Toloue: When we perform these services.

Masoud Toloue: Large they're margin accretive to the total business meaning.

Masoud Toloue: There is a valuable service that we offer with valuable technology and.

Masoud Toloue: They are priced as as accordingly.

Matthew Carlisle Sykes: Got it. Thanks for that. And then, Masoud, just now that we have the Dynadomab adcom date for June 10th, there's obviously a focus on safety, but also on tau levels and detection. What is your expectation for labeling? And if there is tau on the label, is the SIRTUIT AD offering sort of the preferred testing platform, do you believe, for Lilly to execute those tests that need to be done in order to get people on the therapy?

Speaker Change: Got it thanks for that and then.

Matthew Carlisle Sykes: <unk>.

Matthew Carlisle Sykes: Just now that we have the genetic mab.

Matthew Carlisle Sykes: AD Comm date for June 10th.

Matthew Carlisle Sykes: There's obviously a focus on both safety, but also on tau levels in detection.

Matthew Carlisle Sykes: What is your expectation for.

Matthew Carlisle Sykes: Labeling and.

Matthew Carlisle Sykes: If there is <unk> on the label is this tier two at 80.

Matthew Carlisle Sykes: Offering sort of the preferred.

Matthew Carlisle Sykes: Testing platform do you believe for Lilly to execute those.

Matthew Carlisle Sykes: This test to need to get in order to get people onto therapy.

Masoud Toloue: You know, there's, we don't have a really good sense of what the label will look like. Obviously, we're very interested to see what the outcome is going to be of that ad comm meeting. I think, you know, we're hopeful that the results are positive for patients. And having, you know, another therapy or therapy option in the market is, I think, just, overall good for patients. But as to the label, you know, we don't have a sense of what that would look like.

Matthew Carlisle Sykes: So.

Masoud Toloue: There is we don't have really good.

Masoud Toloue: Of.

Masoud Toloue: What the label will look like.

Masoud Toloue: Obviously, we're very interested to see.

Masoud Toloue: What the outcome is going to be of that.

Masoud Toloue: Of that AD comm meeting.

Masoud Toloue: I think.

Masoud Toloue: For that.

Masoud Toloue: Results are positive for patients and.

Masoud Toloue: And having another therapy or therapy option in the market I think it is just overall good for patients but as.

Masoud Toloue: The label.

Masoud Toloue: From the, you know, laboratory or Sirtuit AD, you know, we've been working very closely and collaborating with Lilly over the last, you know, year, several years, and we're super excited that it resulted in the development of this task.

Masoud Toloue: We don't have a sense of what that would look like.

Matthew Carlisle Sykes: Got it. And just one more for me.

Masoud Toloue: In our laboratory.

Masoud Toloue: Okay.

Matthew Carlisle Sykes: We have been working very closely and collaborating with Lilly over the last year.

Matthew Carlisle Sykes: You're several years.

Matthew Carlisle Sykes: Super excited.

Matthew Carlisle Sykes: Resulted in the development of this test.

Matthew Carlisle Sykes: Just given the manufacturing changes that you've made over the past year and looking at Q1 and the consumables growth, it was quite healthy. Is there still an element of switching over to that new process that might have held some growth back in consumables? And do we see that kind of progressing from ease of manufacturing and higher throughput through the manufacturing lines as a potential accelerator for consumables? Yeah, that's a great question. You know,

Speaker Change: Got it and just one more from me.

Matthew Carlisle Sykes: Just given that the manufacturing changes that you've made over the past year.

Matthew Carlisle Sykes: And looking at Q1, and the consumables growth that was quite healthy is there still an element of switching over to that new process. They might have held some growth back in consumables.

Matthew Carlisle Sykes: And do we see that kind of progressing from a ease of manufacturing in higher throughput through.

Matthew Carlisle Sykes: Through the manufacturing lines as a potential accelerated consumables.

Masoud Toloue: Yeah, that's a great question. To your point, over the last year, we've improved production by 300%. Since we began the transformation, you know, we're able to produce, you know, 4 million tests annually, with capacity to ramp up. So we announced that all the work that we had done had come and resulted in new assays that we'd released in Q1. And so now, we're in the process of switching customers to those new assays.

Speaker Change: Yes, that's a great question.

Masoud Toloue: To your point over the last year, we've improved production by 300%.

Masoud Toloue: Since we began the transformation and we're able to produce 4 million tests annually.

Masoud Toloue: With capacity to ramp so.

Masoud Toloue: We announced.

Masoud Toloue: All of the work that we've done come and.

Masoud Toloue: Resulted in new assays that we've released in Q1 and.

Masoud Toloue: So we probably hadn't done a lot of conversion in Q1. I mean, it's a process, switching from an old assay to a new assay, but we expect that conversion to ramp up in Q2, you know, and subsequent quarters.

Masoud Toloue: And so now we're in the process of customer switching to those new assays. So we probably haven't done a lot of conversion in Q1.

Masoud Toloue: It's a process.

Masoud Toloue: Switching from our old assay to a new assay, but we expect that conversion to ramp in Q2.

Masoud Toloue: In subsequent quarters.

Matthew Carlisle Sykes: Great. Thanks, guys. Thanks, Matt. Thank you for your question. Please stand by for our next question.

Speaker Change: Great. Thanks, guys.

Speaker Change: Thanks, Matt.

Speaker Change: Thank you for your question. Please standby for our next question.

Matthew Carlisle Sykes: Okay.

Matthew Carlisle Sykes: Okay.

Speaker Change: Please standby.

Operator: Please stand by. Our next question comes from the line of Kyle Mixon of Canaccord Genuity. Your line is now open.

Matthew Carlisle Sykes: Our next question comes from the line of Tayo Mixon of Canaccord Genuity. Your line is now open.

Kyle Alexander Mikson: Hey, thanks, guys. Just a final point on the near-term outlook. Just wanted to ask what the 2Q instrument placed in the revenue forecast could be, how you're thinking about that relative to 1Q perhaps. And I know we just kind of talked about the consumable rebound. I guess, I mean, not even rebound, just like the continued strength. Pull-through was decent, 1Q a little higher year-over-year, set down from 4Q. But how could all these, you know, updated SKUs and manufacturing kind of, you know, affect, I guess, sequential growth and improvement in consumables in 2Q just based on what you just said, Masoud?

Kyle Alexander Mikson: Hey, Thanks, guys, just a finer point on the near term outlook just wanted to ask what the <unk> instrument placement and revenue forecast could be how youre thinking about that relative to <unk>, perhaps and I know, we just kind of talked about.

Kyle Alexander Mikson: Could the consumable rebound I guess I mean, not even rebound just like the continued strength.

Kyle Alexander Mikson: Pull through was decent in <unk>, a little higher year over year step down from <unk>, but how could like all these update this updated skus and you had new assays manufacturing.

Speaker Change: Kind of.

Masoud Toloue: I guess sequential growth and improvement.

Speaker Change: Consumables in Tokyo, just based on what you just said Masood.

Vandana Sriram: Yeah, thanks for the question, Kyle. I'll take a crack at it first.

Masoud Toloue: Yes. Thanks for the question I'll take a crack at it foodstuffs. So you mentioned there is a lot of stuff going on in consumables. That's certainly a factor as we look at Q2 as well as the sequencing of revenue for the rest of the year. If you look at our history for the last three years, they've generally been about 50, 50, 49 51 from a revenue.

Masoud Toloue: Mixed perspective first half with the second half. This year, we think that mix is going to be more like 25% to 47% because of all the factors that you mentioned on.

Vandana Sriram: So, you know, you mentioned there's a lot of stuff going on in consumables. That's certainly a factor as we look at our Q2, as well as the sequencing of revenue for the rest of the year. If you look at our history for the last three years, we've generally been about 50-50, 49-51 from a revenue mix perspective, first half versus second half.

Vandana Sriram: On the consumable side, we're still very early in the process of customers switching over to the new assays. So we think that's a bit of a longer process and it's going to take some time to really take foot.

Vandana Sriram: In addition, we have new I'd say, it's coming out every quarter, but that base does pick up in the second half of the year.

Vandana Sriram: And that will also contribute to revenue.

Vandana Sriram: This year, we think that mix is going to be more like 45% to 47% because of all the factors that you mentioned below. On the consumable side, we're still very, very early in the process of customers switching over to the new assays. So we think that's a bit of a longer process, and it's going to take some time for it to really take hold. In addition, you know, we have new assays coming out every quarter, but that pace does pick up in the second half of the year. And that will also contribute to revenue. On the instrument side, you know, it's been tough. It's been a tough environment for all of us.

Vandana Sriram: On the instrument side, it's been it's been it's been a tough environment for all of Us do.

Vandana Sriram: We see the pipeline there, we see the interest, but we still see a lot of time to actually convert to revenue. So again, we're cautiously optimistic there, but it's really too soon to call how that shapes up for the second quarter. We've had other instances where it started with a good pipeline but takes very, very long to convert. So we're a little bit cautious there on how soon that bounces back.

Vandana Sriram: We see the pipeline at NBC, the interest, but we still see a lot of time to actually convert.

Vandana Sriram: To revenue so again, we're cautiously optimistic there, but it's really too soon to call how that shapes up for the second quarter. We've had other instances theyre started with a good pipeline that takes a very long to conduct so the answer to the question hopefully.

Vandana Sriram: That bounces back.

Kyle Alexander Mikson: Okay, that was great, Vandana. Thanks for that.

Vandana Sriram: Okay. That's great. Thanks for that and then follow up on <unk> question about the AD copy of Louis AD Com.

Vandana Sriram: Definitely you're going to be focused on safety and efficacy but.

Kyle Alexander Mikson: I know you don't know any of the topics of the questions yet for that meeting, but like are there any read throughs to <unk> specifically from that we should be looking for when that takes place in June.

Kyle Alexander Mikson: I guess assessing tower baseline limited duration dosing was are important features of <unk>.

Kyle Alexander Mikson: Kind of like the.

Speaker Change: And then.

Kyle Alexander Mikson: In the meantime, it looks like lilly's going to prepare the market for a launch post AD comm like what does that mean for your diagnostics business and 25 and beyond.

Kyle Alexander Mikson: And then follow up on Matt's question about the adcom, the Lilly adcom, definitely going to be focused on safety and efficacy. But anyway, we don't know any of the topics or the questions yet for that meeting. But like, are there any readthroughs to Quanterix specifically from, like, what we should be looking for when that takes place in June? You know, I guess assessing the tablet baseline, limited duration dosing, those are important features of the, kind of like, Nanomab. And then, in the meantime, it looks like Lilly's going to prepare the market for launch post-adcom. But, what does that mean for your kind of diagnostics business in 25 and beyond?

Masoud Toloue: Yeah, I mean, Kyle, the way to think of this is that, up until, let's say, a year or two ago, the need for testing just wasn't there. There wasn't a therapy on the market, and there weren't real solutions for folks suffering from Alzheimer's disease.

Speaker Change: Yes, I mean I think the.

Masoud Toloue: The way to think of this as that.

Masoud Toloue: Up until let's say a year or two ago.

Masoud Toloue: The need for testing.

Masoud Toloue: Wasn't there there wasn't a therapy.

Masoud Toloue: The market there Werent real solutions for <unk>.

Kyle Alexander Mikson: And now that there is a therapy and potentially, hopefully, you know, soon, two options, two therapies for patients, there's going to be a real need for testing and, And that's kind of a wide range of tests, right? Picture yourself in an office, and you have patients that are coming in that have a family history but aren't exhibiting memory symptoms. They have actual memory issues or symptoms, and they're asking, "hey, are these therapies right for me?"

Masoud Toloue: Folks suffering from Alzheimer's disease, and now that there is a therapy and potentially hopefully soon to options to therapies for patients there is going to be a real need for testing and.

Kyle Alexander Mikson: And that's kind of a wide range of tests right.

Kyle Alexander Mikson: Picture yourself in an office and you have patients that are coming in.

Kyle Alexander Mikson: Family history, but arent exhibiting memories, sometimes they have.

Kyle Alexander Mikson: Actual memory issues or symptoms and they are asking hey these.

Kyle Alexander Mikson: And so there is a need for a large infrastructure of testing for clinical trial work validation of which tests, when, where, is it a diagnosis, prognosis, is it for monitoring, is it post-treatment monitoring? These are all important questions, and it's not going to be one test that answers all of them. And so we think that it's dynamic, it's a dynamic situation, a dynamic market, and we're excited to participate with what is a leading test when it comes to sensitivity. So I have no specific comments today with regard to the outcome, other than we're hopeful that there will be more options for patients.

Kyle Alexander Mikson: These therapies right for me and and so the need for a large infrastructure of testing.

Kyle Alexander Mikson: Our clinical trial work validation.

Masoud Toloue: Okay, helpful. And then finally, it's on brain-derived tau. Interesting. Could you talk about which antibodies you're using for that? I think I saw BioLegend and Thermo in the publication. And is this BD tau marker going to be added to the multi-marker panel that's, you know, due to come out, I guess, in the next six to 12 months? Yeah, so on the

Kyle Alexander Mikson: Which tests when where.

Masoud Toloue: Is it a diagnosis prognosis is it for monitoring is posted.

Masoud Toloue: Post treatment monitoring these are all important questions and it's not going to be one test the answers all of them and so we think that it's dynamic it's a dynamic situation dynamic.

Masoud Toloue: Market and we're excited to participate with.

Masoud Toloue: What is a leading test when it comes to sensitivity so.

Speaker Change: I have no specific comments.

Masoud Toloue: Today with regard to the outcome.

Masoud Toloue: Other than.

Masoud Toloue: We're hopeful that there's more options for patients.

Masoud Toloue: Okay. That's helpful. And then finally, just on the brain derived Tao to interesting could you talk about which antibodies are you using for that I think as Rob highlighted in thermo <unk> publication and is that is this BD Tao mark are going to be added to the multi marker panel that's due to come out I guess in the next six to 12.

Masoud Toloue: 12 months.

Kyle Alexander Mikson: Yeah, so on the BD Tau, you know, I don't recall if we've disclosed the antibodies that we're using, but it's a really interesting marker. I mean, if you look at just Tau in general, a large portion of that is from peripheral sources, meaning not from the brain. And as much as you can make it more brain specific, we believe that could improve the testing, and it could improve both the accuracy of the test and the sensitivity of the test.

Masoud Toloue: Yes.

Speaker Change: Yeah, so on the BD.

Kyle Alexander Mikson: I don't recall, if we've disclosed.

Kyle Alexander Mikson: The antibodies.

Kyle Alexander Mikson: That we're using but.

Kyle Alexander Mikson: Really interesting marker.

Kyle Alexander Mikson: If you look at.

Kyle Alexander Mikson: Just how in general.

Kyle Alexander Mikson: A large portion of that from peripheral sources, meaning not from the brain and for as much as you can make it more brain specific we believe that could improve the.

Kyle Alexander Mikson: So there, we're looking at BD Tau in combination in a multi-marker setting, one, having it alone, but two, in a multi-marker setting, potentially with some of the phospho Tau that we've talked about, to see if we can see improvement there. Obviously, you want to be measuring brain Tau specifically and not peripheral sources for Alzheimer's Pathology. Perfect, thanks guys.

Kyle Alexander Mikson: Testing and it can improve the <unk>.

Kyle Alexander Mikson: Both.

Kyle Alexander Mikson: Accuracy of the test and sensitivity of the test. So there we're looking at BD Tau in combination.

Kyle Alexander Mikson: Multi marker setting.

Kyle Alexander Mikson: One having it alone but two in a multi marker setting potentially with some of the foster hotels that we have.

Kyle Alexander Mikson: Talked about to see if we can see improvement there. Obviously you wanted to be measuring the brain tower, specifically are not peripheral sources.

Kyle Alexander Mikson: Before Alzheimer's pathology.

Speaker Change: Perfect. Thanks, guys.

Operator: Thank you for your question. As a reminder, to ask a question, simply press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by for our next question. Our next question comes from the line of Sung Jee Nam of Scotiabank. Your line is now open.

Speaker Change: Thanks Scott.

Speaker Change: Thank you for your question as a reminder to ask a question.

Speaker Change: Simply press Star one on your telephone and wait for your name to be announced.

Speaker Change: Draw. Your question. Please press star one again please.

Operator: Please standby for our next question.

Speaker Change: Our next question comes from the line of Phil <unk> of <unk>.

Speaker Change: <unk> Bank. Your line is now open.

Sung Ji Nam: Hi, thanks for taking the questions. Maybe on the five health network collaborations you announced earlier this year, as well as the non-exclusive licensing opportunities for laboratories, could you kind of give us an update? I know it's early on, but what kind of progress you're making there, or the traction you're getting currently, and kind of any feedback there, early feedback from researchers?

Speaker Change: Hi, Thanks for taking the question.

Sung Ji Nam: Maybe on the device.

Sung Ji Nam: Network collaboration you announced earlier this year as well as the licensing abrogate the nonexclusive licensing opportunities for laboratories could you kind of give us an update I know, it's early on but kind of the progress youre, making there or the traction youre getting.

Sung Ji Nam: Currently and kind of any feedback there are the feedbacks, Brian alright.

Masoud Toloue: Yeah, Sanjay, so the feedback has been very positive. I think each of the partnerships and collaborations that we've signed are very enthusiastic about the sensitivity of the platform. You know, very, I would say immaterial revenues and Q1 that will probably be paced by adoption of the LeCambie therapy and future therapies that might come into the market. So, you know, we're looking at that as the largest pacer. But in the meantime, there's been a lot of interest in being able to adopt the Simwell platform. We announced five in the first quarter, and we hope to continue those announcements as we go into the second quarter.

Sung Ji Nam: Alright.

Speaker Change: Yes, so the feedback has been very positive I think each.

Sung Ji Nam: Got it. And then just on my follow up is on the 85.

Sung Ji Nam: But the partnerships and collaborations.

Sung Ji Nam: Collaborations that we've signed they are very enthusiastic about.

Sung Ji Nam: The sensitivity of our platform.

Sung Ji Nam: Very I would say immaterial revenues in Q1.

Sung Ji Nam: That will probably be paced by adoption and adoption of the.

Sung Ji Nam: That can be therapy and.

Sung Ji Nam: Future therapies that may come in the market. So we're looking at that as a.

Sung Ji Nam: The largest largest pacer, but in the meantime.

Sung Ji Nam: Theres been a lot of interest.

Sung Ji Nam: To be able to adopt the somewhat platform, we announced 5% in the first quarter and we hope to continue those announcements as we go into the second quarter.

Speaker Change: Got it and then just.

Speaker Change: My follow up is on <unk>.

Sung Ji Nam: The 85, roughly 5% of the business. So are the growth drivers currently coming from neurology applications, just kind of curious what how much of that is.

Speaker Change: It's driven by all dimers disease, specifically and then within Alzheimer's also how much of it do you have a sense of.

Speaker Change: How much of the growth is coming from truly novel mechanisms of action.

Sung Ji Nam: Or biomarkers.

Masoud Toloue: Yeah, that's a very insightful question. I don't, you know, right now. I would say that it's a pretty even split; there's a large interest in Alzheimer's, but just off the top of my head here, I wouldn't say it's the largest portion of the business. I think if you look at some of the other neuromarkers that we have, just general neuromarkers for neurohealth, are extremely attractive in a lot of these tests and trials. You have to imagine that these markers are, you know, the ultimate proxies for brain health. And short of, you know, doing surgery and going, you know, into the brain, you need some sort of proxy.

Sung Ji Nam: Yes.

Masoud Toloue: Very.

Masoud Toloue: It's an insightful question.

Speaker Change: Hi, Don.

Masoud Toloue: Right now I would say that it's a pretty.

Masoud Toloue: Even split there is a large interest in Alzheimer's, but just off the top of my head here I wouldn't say, it's the largest portion.

Masoud Toloue: Of the business I think if you look at some of the other neuro markers that we have just general neuro markers for neuro health.

Masoud Toloue: Are extremely attractive and a lot of these tests and trials you have to imagine.

Masoud Toloue: These markers are.

Masoud Toloue: Ultimate proxies of our brain health.

Masoud Toloue: And short of doing surgery in.

Masoud Toloue: Going into the brain you need some sort of proxy of hey, as a therapy.

Masoud Toloue: Creating an issue in the brain or.

Masoud Toloue: As the patient improving.

Masoud Toloue: Were there other clinical attributes that might not be detectable today, but.

Masoud Toloue: I'll be able to measure something.

Masoud Toloue: In blood that would give me.

Masoud Toloue: Good proxy for that and so those tests those trials are ongoing and they're not necessarily with house that we have in the portfolio. So good portion.

Masoud Toloue: It is not Alzheimer's related.

Masoud Toloue: And I would say a growing portion.

Masoud Toloue: For future.

Masoud Toloue: Neuropathy is.

Masoud Toloue: Pathologies of the brain.

Speaker Change: Got it thank you.

Speaker Change: Thanks, Andrew.

Operator: Thank you for your questions. Please stand by for our next question. Our next question comes from the line of Dan Brennan of TD Cohen. Your line is now open.

Speaker Change: Thank you for your question. Please standby for our next question.

Operator: Our next question comes from the line of Dan Brennan of Cowen. Your line is now open.

Daniel Gregory Brennan: Thank you. Thanks for the questions and congrats on the quarter. Maybe just, if you couldn't assume, just maybe zoom out. You know, we spent a lot of time on Denama Mav and what impact that could have, but just... You know, it's still obviously very early patient volumes on new therapies and obviously for blood-based testing, regulatory reimbursement, you know, regulatory reimbursement, you know, still, still a lot of that

Daniel Gregory Brennan: Thank you thanks for the questions and congrats on the quarter.

Daniel Gregory Brennan: Maybe just if you couldnt Ms Sue just maybe zoom out.

Daniel Gregory Brennan: A lot of time on denominator.

Daniel Gregory Brennan: What impact that could have but just.

Daniel Gregory Brennan: It's still obviously very early patient volumes of new therapies, and obviously for blood based testing.

Daniel Gregory Brennan: Regulatory reimbursement still still a lot of that to come. So could you just give us a sense for investors looking out say over the next.

Daniel Gregory Brennan: So could you just give us a sense of for investors, if we're looking out to over the next, ,. .. .. .. .. ... , of your clinical business and maybe the competitors, just what are those key events you think we should be looking at that will give us some important guideposts for how this market will begin to develop and the impact for Quanterix?

Daniel Gregory Brennan: Six to 12 months and we're trying to identify some of the key events that will give us more clarity on the initial uptake.

Daniel Gregory Brennan: Of your clinical business and maybe the competitors just what what are those key events do you think we should be looking at.

Daniel Gregory Brennan: That will give us some important guide posts that you know how this market will begin to develop and the impact for <unk>.

Masoud Toloue: Thanks, Dan. So, you know, well, first, I'm going to do an ultra zoom out and say that, first, you know, when you think of the field of diagnostics and you're a company that's interested in doing something that's differentiated in the market, and you want to have a test or a solution that's not just me, it's going to come down to sensitivity. Can you detect disease early? And that's the fundamental paradigm of healthcare versus sick care. Can you measure something early? And can you detect it? So that you can do something about it.

Speaker Change: Thanks, Dan So well first I'm going to do an ultra zoom out and say that.

Masoud Toloue: First.

Masoud Toloue: If you think of the field of diagnostics and and your company Thats interested in doing something that's differentiated.

Masoud Toloue: In the market.

Masoud Toloue: And you want to have a test or a solution that's not me too.

Masoud Toloue: It's kind of come down to sensitivity can you detect disease early and that's the fundamental paradigm.

Masoud Toloue: <unk> healthcare versus sick care can you measure something early and can you detect it.

Masoud Toloue: And Quanterix has been working on this on, you know, several disease fronts. And when it comes to Alzheimer's, we're putting this into practice because there are now therapies on the market, and testing early, we believe is going to be important. Specific to sort of market conditions and what's happening, you know, we think that adoption of the testing is going to be paced by therapy. It's going to be paced by additional clinical work, clinical trials, as we look at the limit of detection that we're at today and future clinical cutoffs.

Masoud Toloue: So that you can do something about it and <unk>.

Masoud Toloue: It has been working on this on several disease fronts and when it comes to Alzheimer's.

Masoud Toloue: We're putting this into practice.

Masoud Toloue: Because there is now therapies on the market and and testing early we believe is going to be important specific to sort of market conditions.

Masoud Toloue: What's happening.

Masoud Toloue: We think that adoption is going to be testing is going to be paced by therapy, it's going to be paced by.

Masoud Toloue: Additional clinical work in clinical trials as we look at the limit of detection.

Masoud Toloue: That we're in today and future future clinical cutoffs, I think theres going to be more and more interest in testing earlier.

Masoud Toloue: I think there's going to be more and more interest in testing earlier. As we see additional readouts from clinical trials that show better efficacy for patients that are measured early, I think that's also going to be a positive sign for testing. And, you know, there are complicated problems in the clinic, where 30% of symptomatic patients have pathologies other than Alzheimer's disease, and that needs to be assessed through differential diagnosis.

Masoud Toloue: As we see additional readouts from clinical trials that show better efficacy for patients that are measured early I think.

Masoud Toloue: That's also going to be a positive sign for for testing.

Masoud Toloue: And.

Masoud Toloue: They are complicated problems in the clinic, which 30% of symptomatic patients.

Masoud Toloue: Pathologies other than Alzheimer's disease, and that needs to be assessed through differential diagnosis. So so at a very.

Masoud Toloue: So, at a very high level, I would say there's a lot of research work that has to be done, and that will be done in conjunction with these pharma companies through our accelerator program. There are a lot of clinical trials that we're performing, but our partners are also performing with our platform, and that has to be done to progress the field. And, you know, as patients make the decision of whether they want to get on the therapy, there's going to be testing that has to happen for those patients. And we think that, you know, Quanterix is going to play a role in each of those categories.

Masoud Toloue: High level I would say.

Masoud Toloue: There's a lot of research work that has to be done and that will be done in conjunction with these pharma companies through our accelerator program. There's a lot of clinical trials that were performing but.

Masoud Toloue: Our partners are also performing within our platform that has to be done to progress the field.

Masoud Toloue: And as patients make the decision about whether they wanted to get on to the therapy, there's going to be.

Masoud Toloue: Testing that has to happen.

Masoud Toloue: For those patients and we think that in our.

Masoud Toloue: <unk> is going to play a role in each of those categories.

Daniel Gregory Brennan: Great, so maybe as a follow-up, Ben, I know you mentioned a few of the trials that are going to be reporting after yourselves. Could you just give us a little more color on, you know, the timing around those trials? And could you also update us on kind of where things stand with the FDA?

Speaker Change: Okay, great. So maybe as a follow up and I know you mentioned a few of the trials that are going to be reporting after yourselves could you just give us a little more color on.

Daniel Gregory Brennan: The timing around those trials and.

Daniel Gregory Brennan: Could you also update us on kind of where things stand with the FDA.

Masoud Toloue: Yeah, so we talked about on the FDA front, so we were excited about the breakthrough designation. We're working, obviously, with the FDA on the trial and the testing and the results that we're going to be providing throughout the year. And so, you know, as we get, as we make more progress, we can provide an update. The trial work has been great. We're going to announce multi-marker data that's coming from both BioHermes and Kentate in late July at AAIC, and we'll probably save some of the highlights for that meeting.

Ben: Yes, so we talked about.

Masoud Toloue: Ft.

Masoud Toloue: Front. So we're excited about the breakthrough designation, we're working obviously with.

Masoud Toloue: With the FDA.

Masoud Toloue: On the trial.

Masoud Toloue: And the testing and the results that we're going to be providing.

Masoud Toloue: About the year and so as we get as we make more progress we can provide an update.

Masoud Toloue: The trial work has been it's been great we're going to announce.

Masoud Toloue: Multi multi marker.

Masoud Toloue: Data that's coming from both by Hermes in Kentucky late July at AIC.

Masoud Toloue: And we are publicly say if some of the highlights for that meeting.

Masoud Toloue: But the trial work has been great. It's supported our 217 work, both Biohermes and the VUMC cohort of Cantare. We've done some early publications of that, and we expect, you know, a peer-reviewed publication to be submitted in May. So, so strong progress. Very happy with the results. I think I'm, you know, just, you know, I mentioned that, you know, we're measuring up to 2000 samples that we measured in BioHermes and VUMC cohorts, of which, you know, a large number of those — both Cantata and Bioharmony. More to come in July.

Masoud Toloue: But <unk> has been great and supported our 2017 work.

Masoud Toloue: Both by our Hermes on WMC cohort of Kentucky.

Masoud Toloue: We've done some early publications of that and we expect.

Masoud Toloue: Peer reviewed publication.

Masoud Toloue: To be submitted in May so so strong progress very happy with the results I think I think I'm just.

Masoud Toloue: I mentioned that.

Masoud Toloue: We're measuring after 2000 samples that we measure it in by Hermes in BMC cohorts of which a large number of those.

Masoud Toloue: Where.

Masoud Toloue: At normal levels, we were able to detect all of those patients and so.

Masoud Toloue: I guess.

Masoud Toloue: Couldn't be going better.

Masoud Toloue: In terms of a clinical trial.

Masoud Toloue: Prospective for.

Masoud Toloue: Both Kentucky and by earning more and more to come in July.

Daniel Gregory Brennan: Great. And maybe one for Vandana, maybe just on the gross margin, a solid beat, just maybe what drove the strength? How do we think about the progression? And I know there was a question earlier about kind of the components of your revenue growth. And I know you kind of gave some qualitative thoughts, but would you be willing to Kind of give us some more granularity, like how we think about kind of full year components for instruments, consumables, and accelerator projects? Thank you. Sure, let me do the gross margin for you.

Speaker Change: Great and maybe one for.

Daniel Gregory Brennan: Maybe just on the gross margin solid beat just maybe what drove the strength how do we think about the progression and I know there was a question earlier.

Vandana Sriram: On kind of the components of your revenue growth and I know you kind of gave some qualitative thoughts, but would you be willing to.

Vandana Sriram: Kind of give us some more granularity like how do we think about like kind of full year components for instruments consumables and accelerated projects. Thank you.

Vandana Sriram: Page PAGE of NUMPAGES www.verbalink.com Page PAGE of NUMPAGES So for the quarter, there were a handful of factors that really helped on the gross margin side. Revenue mix was favorable, you know, higher accelerator sales with individual projects that were at really good margins. We talked about the price list that we implemented at the beginning of the year, as well as the fixes that we put in during the transformation, so overall, you know, a more productive process, better cost control in the process. And then lastly, our inventory management costs were also low.

Vandana Sriram: Sure Let me do gross margin for the quarter the mutual revenue so for the quarter with only a handful of factors that really helps on the gross margin side revenue mix, Florida favorable higher natural way to sue.

Vandana Sriram: The individual projects that we've got really good margins, we talked about the price list that we implemented at the beginning of the <unk> as well as the fixes that we put through in the transformation. So overall more productive Providence better cost controls and the process and then lastly, our inventory management costs were also little.

Vandana Sriram: Recall that Q4 is our quarter for physical inventory, and there's normally some noise that comes in. So that's kind of the profile on the gross margin. There are a couple of variables that can swing it a little bit on a quarter over quarter basis; revenue and project mix is a big piece of that. We're working really hard to drive instrument volumes out, and as and when that happens, that would be slightly diluted to margin.

Vandana Sriram: Recall that Q4 is a quarter for physical inventory and there's normally some noise that comes out of there.

Vandana Sriram: So that's kind of the profile on the gross margin.

Vandana Sriram: There are a couple of variables that can swing it a little bit on a quarter over quarter basis do you have any on project mix is a big piece of that.

Vandana Sriram: We are working really hard to drive instrument.

Vandana Sriram: It hasnt been that happened that would be slightly dilutive to margins and.

Vandana Sriram: And then the second factor there is, we're still in the early stages of the customer switch to the new assays, so there's probably some headroom that we need there in case that's longer or more expensive than the current ones. Overall, really pleased with where we landed, but planning for a couple of points of variability. I'll be going to the next one

Vandana Sriram: And then the second factor there is we're still in early stages of the customer switched to the new assays. So theres, probably some headroom that we need there in case, that's longer are more expensive than the expected. So overall really pleased with where we landed but planning for a couple of points of availability.

Vandana Sriram: We go into the next few quarters.

Vandana Sriram: From a revenue perspective, you know, I indicated that Q2 probably points to, call it, getting up to 45 to 47% of revenue within the first half of the year. For the second half of the year, we continue to see Accelerator have good momentum, so even as we drive instruments up and as we, you know, try to bring that back up to where we'd like it to be, we still see Accelerator as a growth engine.

Vandana Sriram: From a revenue perspective, I indicated that Q2, probably points to getting us to 45% to 47% of revenue within the first half of the yard.

Vandana Sriram: For the second half of the year, we continued to see excellent Rachel has good momentum.

Vandana Sriram: Even as we drive instruments open as we try to bring that back up to where we'd like it to be we still see actual radar as a growth engine and consumables, possibly a slower start in the second quarter as we finish up all of the switching activity, but definitely expecting that to do better in the second half.

Vandana Sriram: And consumables, you know, possibly a slower start in the second quarter as we finish up all of the switching activities, but definitely expecting that to do well in the second half of the year, partly from completing the switch and also partly from the new address that we're

Vandana Sriram: Partly from completing the switch and also partly from the new answers that the opinion.

Speaker Change: Great. Thank you.

Vandana Sriram: Thank you for your questions. This does conclude our question and answer session. Thank you for participating in today's conference. This does conclude the program. You may now disconnect.

Speaker Change: Thank you for your question.

Vandana Sriram: This does conclude our question and answer session. Thank you for participating in today's conference. This does conclude the program you may now disconnect.

Vandana Sriram: Okay.

Vandana Sriram: Okay.

Vandana Sriram: [music].

Vandana Sriram: Yes.

Vandana Sriram: [music].

Vandana Sriram: Okay.

Vandana Sriram: [music].

Vandana Sriram: Yes.