Q2 2024 iSpecimen Inc Earnings Call

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Operator: Good morning everyone, and welcome to the iSpecimen second quarter 2024 earnings conference call. At this time, participants are in a listen-only mode. A question and answer session will follow management's three more. This conference call is being recorded. A replay of today's call will be available in the Investor Relations section of iSpecimen's website and will remain posted for the next 30 minutes. I will now hand the call over to Phil Carlson, Director of Investor Relations, for the introduction and the reading of the Safe Hardware Statement. Please go ahead.

Operator: Good morning, everyone, and welcome to iSpecimen's second quarter 2024 earnings conference call. At this time, participants are in a listen-only mode.

Speaker Change: Good morning, everyone and welcome to the ice specimen second quarter 2024 earnings Conference call. At this time participants are in a listen only mode.

Operator: A question and answer session will follow management three more.

Speaker Change: Question and answer session will follow management's remarks.

Operator: This conference call is being recorded. Every play of today's call will be available on the Investor Relations section of a specimen's website and will remain posted for the next 30 days.

Speaker Change: This conference call is being recorded a replay of today's call will be available on the Investor Relations section of specimens website and will remain posted for the next 30 days I will now hand, the call over to Phil Carlson Investor Relations for the introduction and the reading of the Safe Harbor statement. Please go ahead.

Philip Carlson: I will now hand the call over to Phil Carlson, Investor Relations, for the introduction and the reading of the safe harbor statement. Please go ahead.

Philip Carlson: Thank you, operator. Good morning, everyone, and welcome to iSpecimen's second quarter 2024 conference call. With us on today's call is Tracy Curley, Chief Executive Officer and Chief Financial Officer, and Leslie White, Senior Vice President of Operations.

Phil Carlson: Thank you, operator. Good morning, everyone, and welcome to iSPECIMEN's second quarter 2024 conference call. With us on today's call is Tracy Curley, Chief Executive Officer and Chief Financial Officer, and Leslie Hoyt, Senior Vice President of Operations. Before we begin, I would like to remind you that today's call contains certain forward-looking statements from management made within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended, concerning future events.

Phil Carlson: Thank you operator, good morning, everyone and welcome to <unk>, especially in second quarter 2024 conference call.

Speaker Change: With us on today's call is Tracy Grilli, Chief Executive Officer, and Chief Financial Officer.

Speaker Change: Unless the Hoyt senior Vice President of operations before we begin I would like to remind you that today's call contains certain forward looking statements for management made within the meaning of section 27, a of the Securities Act of 1933 as amended and section 21 E of the Securities and Exchange Act of 1934 as amended concerning future events.

Phil Carlson: Words such as may, should, projects, expects, intends, plans, believes, anticipates, hopes, estimates, and variations of such words and similar expressions are intended to identify forward-looking statements. Such statements are subject to numerous conditions, many of which are beyond the control of the company, including those set forth in the Risk Factor section of the company's Form 10-K for the year ended December 31, 2023, filed with the SEC. Copies of this document are available on the SEC's website at www.sec.gov.

Philip Carlson: Before we begin, I would like to remind you that today's call contains certain forward-looking statements from our management made within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended, concerning future events. Words such as may, should, projects, expects, intends, plans, believes, it dissipates hopes, estimates, and variations of such words and similar expressions are intended to identify forward-looking statements. These statements are subject to numerous conditions, many of which are beyond the control of the company.

Phil Carlson: Actual results may differ materially from those expressed or implied by such forward-looking statements. The company undertakes no obligation to update these statements for revisions or changes after the date of this call, except as required by law. Now, it is my pleasure to introduce Tracy Curley, Chief Executive Officer and Chief Financial Officer. Tracy, please go ahead.

Philip Carlson: We know set forth in the risks factor section of the company's Form 10-K for the year ended December 31, 2023, filed with the SEC. Copies of this document are available on the SEC's website at www.sec.gov. Actual results may differ materially from those expressed or implied by such forward-looking statements.

Philip Carlson: The company undertakes no obligation to update these statements for revisions or changes after the date of this call, except as required by law.

Tracy Curley: Now it is my pleasure to introduce Tracy Curly, Chief Executive Officer and Chief Financial Officer. Tracy, please go ahead. Thank you, Phil.

Tracy Curley: Thank you, Phil. Good morning, and thank you all for joining us on today's call. I'm pleased to report that the second quarter of 2024 results exceeded our internal targets, with many of the initiatives we implemented over the last few quarters starting to produce tangible results, including the Next Day Quote program that was rolled out in the third quarter of 2023. With me today is our Senior Vice President of Operations, Leslie Hoyt, who will provide additional details about the operational programs we have implemented and the impact they have had on iSpecimen. Finally, I will review our financial results for the three and six months ending June 30, 2024 and then open the call for questions.

Tracy Curley: Good morning, and thank you all for joining today's call. And please to report that the second quarter of 2024 results exceeded our internal targets. With many of the initiatives we implemented over the last few quarters starting to produce tangible results, including the next day quote programs that was rolled out in the third quarter of 2023.

Tracy Curley: With me today is our Senior Vice President of Operations, Leslie Hoyt, who will provide additional details about the operational programs we have implemented and the impact they have had on ice specimens.

Tracy Curley: Finally, our review of financial results for the three and six months ended June 30, 2024, and then open the call for questions. As we noted during our first quarter 2024 earnings conference call, we continue to take a measured and disciplined approach to our business to ensure our long-term financial success. By strategically reducing our capital, human resources, and operational expenditures and aligning to focus on key market opportunities, we are setting the stage for revenue growth for the rest of 2024 and beyond. For the second quarter of 2024, we generated revenues of approximately $2.9 million as compared to approximately $1.6 million for the same period in the prior year, representing an increase of 76%.

Tracy Curley: As we noted during our first quarter 2024 earnings conference call, we continue to take a measured and disciplined approach to our business to ensure our long-term financial success. By strategically reducing our capital, human resources, and operational expenditures and aligning to focus on key market opportunities, we are setting the stage for revenue growth for the rest of 2024 and beyond. For the second quarter of 2024, we generated revenue of approximately $2.9 million as compared to approximately $1.6 million for the same period in the prior year, representing an increase of 76%.

Tracy Curley: As I mentioned earlier, these results exceeded our internal projections as we continue to improve operationally while simultaneously providing our customers with a streamlined specimen procurement solution and also continue to strategically reduce our spending in various operational areas. As we focus on our core capabilities, these efforts allowed us to continue to reduce our cash burn from approximately 7.1 million dollars in the first half of 2023 to 2.9 million dollars for the first half of 2024, resulting in a reduced burn rate for the first half of 2024 of 59 percent compared to the same period in the prior year.

Tracy Curley: As I mentioned earlier, these results exceeded our internal projections as we continue to improve operationally while simultaneously providing your customers the streamlined specimen procurement solution. We also continue to strategically reduce our spending in various operational areas as we focus on our core capabilities. These efforts allowed us to continue to reduce our cash burns from a cross-linked $7.1 million in the first half of 2023 to $2.9 million for the first half of 2024, resulting in a reduced burn rate for the first half of 2024, a 59% compared to the same period in the prior year. Our results in the first half of 2024 clearly demonstrate our operational initiatives are taking hold, and we expect to see continued success as we move into the second half of 2024.

Tracy Curley: Our results in the first half of 2024 clearly demonstrate our operational initiatives are taking hold, and we expect to see continued success as we move into the second half of 2024. In our ongoing efforts to strengthen our leadership team and optimize our sales structure, we welcomed Relan Schmalkowski, our new Senior Vice President of Sales and Business Development, to iSpecimen during the quarter. Relan brings over 15 years of experience in life sciences and healthcare.

Speaker Change: As we move into the second half of 'twenty 'twenty four.

Tracy Curley: In our ongoing efforts to strengthen our leadership team and optimize our sales structure, we welcome Belan Schmokowski, our new Senior Vice President of Sales and Business Development to ISpecimen during the quarter. Belan brings over 15 years of experience in life sciences and health care. She will be leading ISpecimen's business development and sales efforts going forward, helping scientists and their organizations procure the biospecimen necessary to advance their research.

Speaker Change: In our ongoing effort to strengthen our leadership team and optimize our sales structure, we will country land. She makowski, our new senior Vice President of sales and business development to ice specimen during the quarter.

Speaker Change: The land brings over 15 years of experience in life Sciences, and health care, she will be leaving I specimens business development and sales efforts going forward, helping scientists and their organizations procured the bio specimens necessary to advance their research and technologies.

Tracy Curley: She will be leading iSpecimen's business development and sales efforts going forward, helping scientists and their organizations procure the biospecimens necessary to advance their research and technology. As I mentioned earlier, Leslie Hoyt, our Senior Vice President of Operations, has played an integral role in developing several of our operational initiatives, like the Next Day Quote program. She has also led the effort to ensure that we understand more deeply the competencies of our supplier network and engage with those suppliers that offer the strongest capabilities.

Tracy Curley: As I mentioned earlier, Leslie Hoyt, our Senior Vice President of Operations, has played an integral role in developing several of our operational initiatives, like the Next Day Quote Program. She has also led the effort to ensure that we understand more deeply the competencies of our supplier network and engage with those suppliers that offer the strongest capabilities. This effort has already helped us greatly improve the quality of our supplier network, and the Next Day Quote Program has contributed to increase philosophy through our sales funnel and the strong results we have generated.

Speaker Change: As I mentioned earlier Leslie Hoyt, our senior Vice President of operations. That's played an integral role in developing several of our operational initiatives like the next day quote program. She.

Speaker Change: She has also led the effort to ensure that we understand more deeply the competencies of our supplier network and engage with those suppliers that offer the strongest capabilities.

Tracy Curley: This effort has already helped us greatly improve the quality of our supplier network, and the Nix Day Quote Program has contributed to increased velocity through our sales funnel and the strong results we have generated. I would now like to turn our call over to Leslie to review our operational improvements and what we believe the impact has been for iSpecimen. Leslie, please go ahead. Thank you, Tracy.

Speaker Change: This effort has already helped us greatly improved the quality of our supplier network and then next stage quote program has contributed to increased philosophy through our sales funnel and the strong results we have generated.

Leslie Hoyt: I would now like to turn our call over to Leslie to review our operational improvements and what we believe the impact has been for ISpecimen. Leslie, please go ahead. Thank you, Tracy. Second quarter results show that the actions we have taken to streamline our operations, coupled with the programs we implemented at the end of 2023, are starting to gain traction. As Tracy mentioned, these programs contributed to the company exceeding its internal revenue targets. We remain squarely focused on the quality of our supplier network and the specimens that we provide to the research community. With the Next Day Quote Program, we also remain focused on an expedited courting process in order to increase conversions at every point through the sales funnel.

Speaker Change: I would now like to turn our call over to Leslie to review, our operational improvements and what we believe the impact has been price assessments Leslie. Please go ahead.

Leslie: Thank you Tracy.

Leslie Hoyt: Second quarter results show that the actions we have taken to streamline our operations, coupled with the programs we implemented at the end of 2023, are starting to gain traction. As Tracy mentioned, these programs contributed to the company exceeding its internal revenue target.

Leslie Hoyt: We remain squarely focused on the quality of our supplier network and the specimens that we provide to the research community. With the Next Day Quote program, we also remain focused on an expedited quoting process in order to increase conversions at every point through the sales funnel. I believe that we are better positioned to meet the demands of our BioSpecimen customers than we have ever been.

Leslie Hoyt: I believe that we are better positioned to meet the demands of our biospecimen customers than we have ever been. As our Next Day Quote Program grows, those are the results. The percentage of total opportunities we are qualifying as Next Day Quotes across all segments for relevant and bio-bank specimens as well as prospective collections continues to remain high. Our Next Day Quote Program has allowed us to streamline the process for our customers and our suppliers. For our customers, this means that ice specimen will often respond to inquiries within the same or next day, outlining the cost, timeline, and approach to provide the needed specimens.

Leslie Hoyt: As our next day quote program grows, so do the results. The percentage of total opportunities we are qualifying as next day quotes across all segments for remnant and biobank specimens, as well as prospective collections, continues to remain high. Our Next Day Quote program has allowed us to streamline the process for our customers and our suppliers. For our customers, this means that iSpecimen will often respond to inquiries within the same or next day, outlining the cost, timeline, and approach to provide the needed specimens.

Leslie Hoyt: We are proud to say that 99% of our customers are able to participate in the next-day quote program. For our suppliers, it means that we can search internal data on supplier capabilities and pricing, reducing time-consuming phone calls to suppliers and redundancy. For Q2 2024, 44% of quotes provided to customers were part of the next-day quote program, a steady improvement from 38% of quotes in Q4 of 2023 and 43% in Q1 of this year. In the first top of 2024, an incredible 58% of next-day quotes were converted to purchase orders, directly contributing to our ability to exceed our internal revenue goals for Q2 2024.

Leslie Hoyt: We are proud to say that 99% of our customers are able to participate in the Next Day Quote program. For our suppliers, it means that we can search internal data on supplier capabilities and pricing, reducing time-consuming phone calls to suppliers and redundancy. For Q2 2024, 44% of quotes provided to customers were part of the Next Day Quote program, a steady improvement from 38% of quotes in Q4 of 2023 and 43% in Q1 of this year.

Leslie Hoyt: In the first half of 2024, an incredible 58% of next day quotes were converted to purchase orders, directly contributing to our ability to exceed our internal revenue goals for Q2 2024. Over the coming quarters, we will continue to expand the Next Day Quote program. With information gathered from our suppliers and the ability to search that data, we are planning to provide next day estimates to customers, even when we are not able to offer a quote.

Leslie Hoyt: Over the coming quarters, we will continue to expand the next-day quote program. With information gathered from our suppliers and the ability to search that data, we are planning to provide next-day estimates to customers, even when we are not able to offer quotes. This process should expedite and enhance conversations between sales and potential customers and lead to more quotes with higher conversion rates.

Leslie Hoyt: This process should expedite and enhance conversations between sales and potential customers and lead to more quotes with higher conversion rates. Over the next few quarters, we will provide more information on the expansion of the Next Big Quote program and the tools that are being built to support it. Tracy, please go ahead.

Leslie Hoyt: Over the next few quarters, we will provide more information on the expansion of the next-day quote program and the tools that are being built to support it.

Tracy Curley: I would now like to turn the call over to Tracy to review our financial results. Tracy, please go ahead. Thank you, Leslie. For the three months in the June 30th, 2024, revenue was approximately $2.9 million compared to approximately $1.6 million for the three months in the June 30th, 2023. The increase in revenues for the second quarter of 2024 was primarily due to an increase of 1,236 specimens or 26% in specimen count from 4,682 specimens in the three months in June 30th, 2023, to 5,908 specimens in the three months in June 30th, 2024. The average selling price per specimen also increased by $137.39 from $347 in the three months in the June 30th to $484 in the three months in the June 30th, 2024.

Tracy Curley: For the three months ended June 30, 2024, revenue was approximately $2.9 million compared to approximately $1.6 million for the three months ended June 30, 2023. The increase in revenue for the second quarter of 2024 was primarily due to an increase of 1,236 specimens, or 26%, in specimen count from 4,682 specimens in the three months ended June 30, 2023 to 5,918 specimens in the three months ended June 30, 2024. The average selling price per specimen also increased by $137 or 39% from $347 in the three months ended June 30 to $484 in the three months ended June 30, 2024.

Tracy Curley: For the six months into June 30th, 2024, revenue was approximately $5.2 million compared to approximately $4.6 million for the six months into June 30th, 2023. This increase was primarily due to an increase in average selling price per specimen of $119.34 from $343 in the six months into June 30th, 2023 to $462 in the six months into June 30th, 2024. The increase in the average selling price per specimen was offset by a decrease of 2,152 specimens, or 16%, in the number of specimens from 13,311 specimens in the six months into June 30th, 2023 to 11,159 specimens in the six months into June 30th, 2024.

Tracy Curley: For the six months in the June 30th, 2024, revenue was approximately $5.2 million compared to approximately $4.6 million for the six months in the June 30th, 2023. This increase was primarily due to an increase in average selling price per specimen of $119.34, from $343 in the six months in the June 30th, 2023, to $162 in the six months in the June 30th, 2024. The increase in average selling price per specimen was offset by a decrease of 2,152 specimens for 16% in specimen count from 13,311 specimens in the six months in the June 30th, 2023, to 11,159 specimens in the six months in the June 30th, 2024.

Leslie: 2024.

Leslie: Increase in average selling price per specimen was offset by a decrease of 2152 specimens for 16% and specimen count from 13311 assessments in the six months ended June 32023 to 11159 specimens.

Leslie: In the six months ended June 32024.

Tracy Curley: 44.

Tracy Curley: Cost of revenue increased by approximately $570,000 or 67% to approximately $1.4 million for the three months ending in 30 as 2024. In terms of pricement, $864,000 for the three months ending in 30 as 2023. The increase in cost of revenue was attributed to a 26% increase in the number of specimens of session for the current period and a 32% increase in the average cost perspective compared to the same period in the prior year. Cost of revenue increased by approximately $423,000 or 21% to approximately $2.4 million for the first six months ending in 30 as 2024.

Tracy Curley: Cost of revenue increased by approximately $570,000, or 67%, to approximately $1.4 million for the three months into June 30, 2024, compared to approximately $854,000 for the three months into June 30, 2023. The increase in cost of revenue was attributed to a 26% increase in the number of specimens of session for the current period and a 32% increase in the average cost per specimen compared to the same period in the prior year.

Speaker Change: Cost of revenue increased by approximately $570000 or 67% to approximately $1 $4 million.

Speaker Change: The three months ended June 30th 2024, compared to approximately $854000 for the three months ended June 32023.

Speaker Change: The increase in cost of revenue was attributed to a 26% increase in the number of assessments of session for the current period and a 32% increase in the average cost perspective, when compared to the same period in the prior year.

Tracy Curley: Cost of revenue increased by approximately $423,000, or 21%, to approximately $2.4 million for the first six months ending June 30, 2024, compared to approximately $2 million for the six months ending June 30, 2023. The increase in cost of revenue was attributable to a 45% increase in the average cost per specimen impacted by the specimen mix, offset by a 16% decrease in the number of specimens per session compared to the same period in the prior year.

Speaker Change: Cost of revenue increased by approximately $423000 for 21% to approximately $2 $4 million for the first six months ended June 32024, compared to approximately $2 million for the six months ended June 32023, the increase in cost of revenue was attributable.

Tracy Curley: Compared to approximately $2 million for the six months ending in 30 as 2023, the increase in cost of revenue was attributable to a 45% increase in the average cost for specimens impacted by the specimen mix, offset by a 16% decrease in the number of specimens of session compared to the same period in the prior year.

Tracy Curley: For the second quarter of 2024, we decreased our cash spend for technology to approximately $541,000 from approximately $1.5 million for the same period in the prior year. For the six-month period in the June 30, 2024, we decreased our cash spend for technology to approximately $1.2 million from approximately $3.5 million for the same period in the prior year. The decrease in spend for the three and six month periods ending June 30 as 2024, compared to the same prior year's periods, is due to reductions in workforce stemming from our decision to invest at a significantly lower level in 2024 when compared to 2023 in prior years.

Tracy Curley: For the second quarter of 2024, we decreased our cash spend on technology to approximately $541,000 from approximately $1.5 million for the same period in the prior year. For the six-month period ending June 30, 2024, we decreased our cash spend on technology to approximately $1.2 million from approximately $3.5 million for the same period in the prior year. The decrease in spend for the three- and six-month periods ending June 30, 2024, compared to the same prior year's period, is due to reductions in workforce stemming from our decision to invest at a significantly lower level in 2024 when compared to 2023 in previous years, while we focus on growing our revenues through key market opportunities and assessing our capital rates.

Tracy Curley: While we focus on growing our revenues through key market opportunities and assessing our capital race process. For the three-month period ending June 30, 2024, cash spend was comprised of approximately $172,000 of capitalized internally developed software and approximately $359,000 of expenses that we were otherwise not able to capitalize and therefore classified as technology expense. The remainder of the technology expense for the three-month period in the June 30, 2024, was comprised of approximately $543,000 of non-cash amortization related to internally developed software. Total technology expense for the three-month period ended June 30, 2024, was approximately $912,000 compared to approximately $843,000 for the same period in the prior year.

Tracy Curley: For the three-month period into June 30, 2024, CASH SIN was comprised of approximately $172,000 of capitalized internally developed software and approximately $369,000 of expenses that we were otherwise not able to capitalize and therefore classified as technology expense. The remainder of the technology expense for the three-month period into June 30, 2024 was comprised of approximately $543,000 of non-CASH amortization related to internally developed software. Total technology expense for the three-month period ending June 30, 2024 was approximately $912,000 compared to approximately $843,000 for the same period in the prior year.

Tracy Curley: For the six-month period ended June 30 as 2024, cash spend was comprised of approximately $448,000 of capitalized internally developed software and approximately $748,000 of technology expense that we were otherwise not able to capitalize and therefore classified as technology expense. The remainder of the technology expense for the six-month period in the June 30, 2024, was comprised of approximately $1.1 million of non-cash amortization related to internally developed software. Total technology expense for the six-month period in the June 30, 2024, was approximately $1.8 million compared to $1.7 million of the same period in the prior year. The sales and marketing expenses increased by approximately $105,000 or 11 percent from approximately $978,000 for the three month in the June 30 as 2023 to approximately $1.1 million for the three month in the June 30 as 2024.

Tracy Curley: For the six-month period ended June 30, 2024, cash spend was comprised of approximately $448,000 of capitalized internally and developed software and approximately $748,000 in technology expense that we were otherwise not able to capitalize and therefore classified as technology expense. The remainder of the technology expense for the six-month period ended June 30, 2024 was comprised of approximately $1.1 million of non-cash amortization related to internally developed software. Total technology expense for the six-month period ended June 30, 2024, was approximately $1.8 million compared to $1.7 million for the same period in the prior year.

Tracy Curley: The sales and marketing expenses increased by approximately $105,000, or 11%, from approximately $978,000 for the three months ended June 30, 2023 to approximately $1.1 million for the three months ended June 30, 2024. The increase was primarily attributable to increases in compensation expenses of approximately $123,000 and advertising and promotion expenses of approximately $100,000, partially offset by decreases in external marketing expenses of approximately $96,000 and general operating expenses related to sales and marketing of approximately $22,000.

Tracy Curley: The increase was primarily a trivial to increases in compensation expenses of approximately $123,000 and advertising and promotion expenses of approximately $100,000, partially upstab by decreases in external marketing expenses of approximately $96,000 and general operating expenses related to sales and marketing of approximately $22,000. Fails and margin expenses decreased by approximately $276,000, with 14% from approximately $2 million for the six months in the June 30th, 2023, to approximately $1.7 million for the six months in the June 30th, 2024. The period-over-period decrease was primarily attributable to decreases in external marketing expenses of approximately $191,000. Compensation expenses of approximately $179,000, and general operating expenses related sales market of approximately $42,000.

Tracy Curley: Sales and marketing expenses decreased by approximately $276,000, or 14%, from approximately $2 million for the six months into June 30, 2023, to approximately $1.7 million for the six months into June 30, 2024. The period-over-period decrease was primarily attributable to decreases in external marketing expenses of approximately $191,000, compensation expenses of approximately $179,000, and general operating expenses-related sales and marketing of approximately $42,000, partially offset by increases in advertising and promotion expenses of approximately $136,000.

Tracy Curley: Power share offset by increases in advertising and promotion expense of approximately $136,000.

Tracy Curley: General and administrative expenses increased by approximately $703,000 or 40% from approximately $1.8 million for the three months in the June 30th, 2023, to approximately $1.1 million for the three months in the June 30th, 2024. and utilities and facility expenses of approximately $5,000. General and administrative expenses decreased by approximately $311,000 and 9% from the approximately $3.5 million for the six months in the June 30th, 2023, to approximately $3.2 million for the six months in the June 30th, 2024. The period-over-period decrease was attributable to decreases in compensation costs of approximately $348,000, general operating expenses of approximately $105,000, bad debt expense of approximately $57,000, depreciation and amortization of approximately $44,000.

Tracy Curley: General and administrative expenses decreased by approximately $703,000, or 40%, from approximately $1.8 million for the three months into June 30, 2023, to approximately $1.1 million for the three months into June 30, 2024. The period-over-period decrease was attributable to decreases in compensation costs of approximately $183,000, taxes and insurance of approximately $176,000, professional fees of approximately $165,000, bad debt expense of approximately $102,000, general and operating expenses of approximately $51,000, depreciation and amortization of approximately $21,000, and utilities and facility expenses of approximately $5,000.

Tracy Curley: General and Administrative expenses decreased by approximately $311,000, or 9%, from approximately $3.5 million for the six months into June 30, 2023 to approximately $3.2 million for the six months into June 30, 2024. The period-over-period decrease was attributable to decreases in compensation costs of approximately $348,000, general operating expenses of approximately $105,000, bad debt expense of approximately $57,000, depreciation and amortization of approximately $44,000, utilities and facilities expense of approximately $9,000, which were partially offset by increases in professional fees of approximately $161,000, and taxes and insurance of approximately $91,000.

Tracy Curley: Utilities and facilities expense of approximately $9,000, which were partially offset by increases in professional fees of approximately $161,000, and taxes insurance of approximately $91,000.

Tracy Curley: As of June 30th, 2024, I specimen had $2.1 million of cash and available for sale securities, which represented a decrease of approximately $2.9 million from approximately $5 million as of December 31st, 2023, and a decrease of approximately $405,000 from approximately $2.6 million as of March 31st, 2024. As we mentioned in our last earnings call on March 5th, we entered into an ATM to issue and sell shares of common stock with an aggregate offering price of up to $1.5 million through our shelf registration statement. During the six months in the June 30th, 2024, we sold 3,980,000 75 shares of common stock for gross proceeds of approximately $1.5 million to the ATM agreement.

Tracy Curley: As of June 30, 2024, iSpecimen had $2.1 million of cash and available-for-sale securities, which represented a decrease of approximately $2.9 million from approximately $5 million as of December 31, 2023 and a decrease of approximately $405,000 from approximately $2.6 million as of March 31, 2024. As we mentioned in our last earnings call on March 5th, we entered into an ATM to issue and sell shares of Comstock with an aggregate offering price of up to $1.5 million through our shelf registration statement.

Tracy Curley: During the six months ending June 30th, 2024, we sold 3,980,075 shares of Comstock for gross proceeds of approximately $1.5 million under the ATM agreement. We incurred offering costs of approximately $255,000, resulting in net proceeds of approximately $1.2 million.

Tracy Curley: We incurred offering cost of approximately $255,000, resulting in net proceeds of approximately $1.2 million. Proceeds were used primarily for the management of our accounts payable. The future success of the company is dependent on its ability to successfully obtain additional working capital and/or to ultimately obtain possible operations. We are actively working on both.

Speaker Change: The ATM agreement incurred author and Costco question $255000, resulting in net proceeds of approximately $1 $2 million proceeds were used primarily for the management of our accounts payable.

Tracy Curley: Proceeds were used primarily for the management of our accounts payable. The future success of the company is dependent on its ability to successfully obtain additional working capital and, ultimately, obtain profitable operations. We are actively working on both. We have initiated aggressive efforts to decrease our operational expenditures by cutting costs and rightsizing the company through reductions in the workforce. Throughout the year ending December 31, 2023 and into the first half of 2024, we have executed reductions in the workforce while streamlining operations and rationalizing resources to focus on key market opportunities.

Speaker Change: Sure success of the company is dependent on its ability to successfully obtaining additional working capital and to ultimately obtain possible operations.

Speaker Change: We're actively working on both we have initiated aggressive efforts to decrease our operational expenditures by cutting costs and right sizing the company through reductions in the workforce.

Tracy Curley: We have initiated aggressive efforts to decrease our operational expenditures by cutting costs and right sizing the company through reductions in the workforce throughout the year in the December 31st, 2023, and into the first half of 2024. We have executed reductions in workforce while streamlining operations and rationalizing resources to focus on key market opportunities. The reductions in workforce since January 1st, 2023, through the end of June 30th, 2024, has resulted in an estimated reduction in compensation costs of approximately 45% in technology costs of approximately 66% by the end of June 30th, 2024, when compared to January 1st, 2023.

Speaker Change: Throughout the year ended December 31, 2023 and into the first half of 2024 you have extra.

Speaker Change: Executing reductions in workforce, while streamlining operations and rationalizing resources to focus on key market opportunities.

Tracy Curley: The reductions in the workforce since January 1st, 2023 through the end of June 30th, 2024 have resulted in an estimated reduction in compensation costs of approximately 45% and technology costs of approximately 66% by the end of June 30th, 2024 when compared to January 1st, 2023. In addition, the company plans to add additional customers and suppliers to increase revenues, as well as to continue to reduce and manage expenditures to improve its financial position and ensure continued funding of operations. We are actively seeking to fund operations as we reach a cash-positive position through public equity or debt financing, as well as other sources.

Speaker Change: The reductions in workforce since January one 2023 through the end of June 30 of 2024, hence, resulting in an estimated reduction of compensation cost of approximately 45% and technology costs of approximately 66%, but it ended June 32024, when compared to January one 2020.

Tracy Curley: In addition, the company plans to add additional customers and suppliers to increase revenues, as well as to continue to reduce and manage expenditures to improve its financial position and ensure continues funding of operations. We are actively seeking to fund operations as we reach a cash positive position through public equity or debt financing, as well as other sources.

Speaker Change: Three in.

Tracy Curley: This concludes our prepared remarks. Now I'd like to open the call for questions. Operator, please go ahead.

Operator: This concludes our prepared remarks. Now we'd like to open the call for questions. Operator, please go ahead. Thank you so much, presenters, and ladies and gentlemen. You will now begin the question and answer session. Should you have a question, please press star followed by the number one on your touchtone phone. You will hear a prompt that your hand has been raised. And should you wish to decline the polling process, please press the star followed by the number two. And if you're using a speakerphone, please lift the handset before pressing any key. And our first question comes from the line of Matt Hewitt of Craig Hellam Capital Group. Your line is now open. Good morning.

Operator: Thank you so much for centers and ladies and gentlemen. You will now begin to question and answer session. Should you have a question, please press star followed by the number one on your touch-tone phone. You will hear a prompt that your hand has been raised, and should you wish to decline from the polling process, please press the star followed by the number two.

Operator: And if you're using a speaker phone, please lift the hand sit before pressing any keys.

Matthew Hewitt: And their first question comes from the line of Matt Uitt of Craig Helen Capital Group. Your line is now open. Good morning, and congratulations on the strong quarter. Thank you.

Tracy Curley: Good morning, and congratulations on the strong quarter. Maybe first up, could you describe or talk a little bit about the macro environment, what you're hearing from customers and suppliers, but more so on the customer side of the equation, you know, how are they feeling about their funding, you know, have there been any shifts in prioritization of projects, anything along those lines?

Tracy Curley: Maybe first up, could you describe or talk a little bit about the macro environment, what you're hearing from customers and suppliers, but more so than on the customer side of the equation. You know, how are they feeling about their funding? You know, has there been any shifts in prioritization of projects, anything along those lines?

Tracy Curley: It's still a real tough environment for researchers right now, so they're being very careful on what, you know, they're willing to invest in for research, but they're still out there pursuing projects.

Tracy Curley: It's still a really tough environment for researchers right now, so they're being very careful about what, you know, they're willing to invest in for research, but they're still out there pursuing projects. Leslie, you're a little bit closer to this than I am operationally. Any insights that you'd like to share with Matt?

Tracy Curley: Leslie, you're a little bit closer to this than I am operationally in sites that you'd like to share with Matt. I would add two quick things, Matt. I would say that the projects continue, but the demands are high. We're seeing more and more specificity in the requirements. And number two is timeliness matters. When they get funding and they're ready to go, they're ready to go, which is why we're really working on the timing of our response in both getting to a quote back to the customer. And then also the timeliness of starting our projects once we have a purchase order.

Leslie Hoyt: I would add two quick things, Matt. I would say that the projects continue, but the demands are high. We're seeing more and more specificity in the requirements, and number two, timeliness matters. When they get funding and they're ready to go, they're ready to go, which is why we're really working on the timing of our response and both getting a quote back to the customer and then also the timeliness of starting our projects once we have a purchase order.

Matthew Hewitt: Well, that's a great segue, great segue into my next question on the next day quotes. 58% converted to purchase orders in the quarter; that's fantastic.

Tracy Curley: Got it, well that's a great segue into my next question on the next day quotes, 58% converted to purchase orders in the quarter. That's fantastic. Do you have an internal target or is there some type of a goal that you've kind of set where you'd like to see, is it 75% or, you know, how should we be thinking about that metric?

Tracy Curley: Do you have an internal target, or is there some type of a goal that you've kind of set where you'd like to see, is it 75% or, you know, how should we be thinking about that metric? So, we do, but as you know, we don't really give guidance, Matt. I would love for it to be 100% to be honest, but, you know, so we're not giving guidance on that. But we do have an internal goal that we are tracking towards that, and it is much higher than the 58%. Got it.

Tracy Curley: So, we do, but as you know, we don't really give guidance, Matt. I would love for it to be 100%, to be honest, but... So we're not getting guidance on that, but we do have an internal goal that we are tracking for that, and it is much higher than the 58%.

Tracy Curley: Got it. Okay.

Tracy Curley: And then, shifting gears a little bit, the focus on the increase in the quality of your suppliers. Are those suppliers able to fulfill most, if not all, of the requests you had previously been getting from a broader spectrum of suppliers? Like, have you found the 200 to 300 that you think can fulfill 99% of any requests that you would come across at the transom?

Tracy Curley: Okay, and then shifting gears a little bit, the focus on the increase in the quality of your suppliers. Are those suppliers able to fulfill most, if not all, of the requests you had previously been getting from a broader spectrum of suppliers? Like, have you found the 200, 300 that you think can fulfill 99% of any requests that you would come, you know, would come across with the transome?

Tracy Curley: So, I'm going to answer that a little bit, but then I'm going to turn it over to Leslie because she's really, really much closer to this. We realized last year that we had a lot of suppliers that we really had not been engaging with in a meaningful fashion, and they hadn't been engaging with us either. So we embarked on what we call a supplier refresh, which we've talked about in prior quarters

Tracy Curley: So, I'm going to answer that a little bit, but then I'm going to turn it over to Leslie because she's really, really much closer to this. So, we realized last year that we had a lot of suppliers that we really had not been engaging with in a meaningful fashion, and they hadn't been engaging with either. So, we embarked on what we called supplier refresh, which we've talked about in prior quarters, and we terminated a lot of contracts with suppliers the first half of this year. We are now down to 105 suppliers from where we were at 240 in 2023.

Tracy Curley: And we terminated a lot of contracts with suppliers in the first half of this year. We are now down to 105 suppliers from where we were at 240 in 2023. And the reason for this is that as we did our supplier refresh and engaged with the suppliers to understand, you know, quality, pricing, quantity, and capabilities, we actually found out that, over time, our suppliers' capabilities had shifted, and we had not been aware of that.

Tracy Curley: And the reason for this is because, as we did our supplier refresh and engage with the suppliers to understand, you know, quality, pricing, quantity, capabilities, we actually found out that over time, our supplier's capabilities had shifted and we had not been aware of that. And so, we have discovered that we actually have suppliers within our network that could provide us; maybe they were only doing remnant or bank specimens, but they had expanded their capabilities so that now they could provide us for perspective, which was, you know, a real eye-opener for us, a real pleasant eye-opener, if you will, for us to find that out.

Tracy Curley: And so we discovered that we actually have suppliers within our network that could provide us with, maybe they were only doing remnant or bank specimens, but they had expanded their capabilities so that now they could provide us with perspective, which was, you know, a real eye-opener for us, a real pleasant surprise, if you will, for us to find that out. And so those are the suppliers that we want to engage with more. I'll turn it over to Lesley to sort of complete it.

Leslie Hoyt: And so, those are the suppliers that we want to and have been engaging with more alternative and the legs later, sort of complete.

Leslie Hoyt: Yes, I 100% agree, Tracy. With the limited or less suppliers that we have now, we actually have more capabilities. And mostly because we are aware of the capabilities, have taken the time to survey and have conversations with suppliers to truly understand what they do and what they're capable of doing. I would say, you know, we are a larger percentage of their business now, which makes them more responsive to us and hence to our customers.

Leslie Hoyt: Yes, I 100% agree, Tracy. With the limited or fewer suppliers that we have now, we actually have more capabilities. And mostly because we're aware of the capabilities, having taken the time to survey and have conversations with suppliers to truly understand what they do and what they're capable of doing. I would say... You know, we are a larger percentage of their business now, which makes them more responsive to us and hence to our customers.

Leslie Hoyt: So, it's really been an interesting endeavor, getting to know these suppliers, which we continue to do. More and more, and to see how we can have a smaller network with more aligned suppliers that we know more about. So, the supply has not been an issue to date.

Leslie Hoyt: So it's really been an interesting endeavor getting to know these suppliers, which we continue to do more and more, and to see how we can have a smaller network with more aligned suppliers that we know more about. So supply has not been an issue to date.

Speaker Change: Yeah.

Matthew Hewitt: Got it, and then maybe a couple metrics. I apologize if I missed this, but do you have the number of unique customers during the quarter and the number of registered research and supplier users during the quarter? I think I'm going to have to give past you on that. I don't have that at my fingertips. No problem. All right.

Tracy Curley: Got it. And then maybe a couple of metrics, and I apologize if I miss this, but do you have the number of unique customers during the quarter and the number of registered research and supplier users during the quarter?

Speaker Change: Got it and then maybe a couple of metrics and I apologize if I missed this but do you have the the number of unique customers during the quarter and the number of registered research and supplier users during the quarter.

Tracy Curley: I think I'm going to have to get back to you on that because I don't have it at my fingertips.

Speaker Change: I think I've got to get back to you on that at all from that at my fingertips.

Tracy Curley: No problem. All right. Thank you very much, and congratulations again on the quarter. Thank you.

Matthew Hewitt: Thank you very much, and congratulations again on the quarter. Thank you, Matt. Appreciate it.

Speaker Change: No problem alright, Thank you very much and congratulations again on the quarter.

Operator: Thank you, Matt. I appreciate it. Thank you so much. And again, if you would like to ask a question, please press star 1. And I will show no further questions in the queue.

Speaker Change: Thank you Matt appreciate it.

Operator: Thank you so much, and again, if you would like to ask a question, please press star one. And I show no further questions in the queue.

Speaker Change: Thank you so much and again, if you would like to ask a question. Please press star one.

Speaker Change: And I show no further questions in the queue at this time I'd like to turn the call over to MS. Tracy Curly CEO for closing remarks.

Tracy Curley: At this time, I'd like to turn the call over to Ms. Tracy Curley, CEO, for closing remarks. Thank you. I would like to thank everyone again for joining us on today's call and for your continued support. We believe the operational advancements that we've made this quarter and, frankly, for the last several quarters, will play a significant role in our future growth. We are changing the landscape of our business by more rapidly and effectively connecting biospecimen suppliers with researchers, and we believe that that is key to our success.

Tracy Curley: At this time, I'd like to turn the call over to Mr. Tracy Curley, CEO, for closing remarks. Thank you. I would like to thank everyone again for joining us on today's call and for your continued support. We believe the operational advancements that we've made this quarter and frankly to the last several quarters will play a significant role in our future growth. We are changing the landscape of our business by more rapidly and effectively connecting by our specimen suppliers with researchers, and we believe that that is key for our success. Our next day quote program has proven successful, and we look forward to updating you with our continued roll out of this program, as well as other initiatives that we are currently working on.

Operator: Our next day program has proven successful, and we look forward to updating you on our continued rollout of this program as well as other initiatives that we are currently working on. And with that, thank you, and have a great day. This concludes today's conference call. Thank you for participating, and you may now disconnect. Have a good day!

Tracy Curly: Thank you.

Tracy Curly: I'd like to thank everyone again for joining us on today's call and for your continued support we believe the operational enhancements that we've made this quarter and.

Tracy Curly: Frankly for the last several quarters will play a significant role in our future growth.

Operator: And with that, thank you and have a great day. This includes today's conference calls.

Operator: Thank you for participating, and we now disconnect. Have a good day.