Q1 2025 Seer Inc Earnings Call
Good day and thank you for standing by. Welcome to the Seer for Squadron 2025 Earnings Conference call.
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I would now like to hand the conference over to Kelly Gura, Investor Relations. Please go ahead.
Kelly Gura: Thank you. Earlier today, Seer released financial results for the quarter-ended March 31st, 2025. If you've not received this news release, or if you'd like to be added to the company's distribution list, please send an email to investor at seer.bio
Kelly Gura: Joining me today from Seer is Omid Farokhzad, Chief Executive Officer and Chair of the Board and David Horn, Chief Financial Officer and President.
Kelly Gura: Before we begin, I'd like to remind you that management will make statements during this call that are forward-looking statements within the meeting of federal security blogs.
Kelly Gura: These statements involve material risks and uncertainties that could cause actual results or events to materially differ from both anticipated.
Kelly Gura: Additional information regarding these risks and uncertainties appears in the section titled Forward Looking Statements in the Presbyterian Sphere issue today.
Kelly Gura: For a more complete list in description, please see the risk factors section of the company's quarterly report on Form 10Q for the quarter ended March 31st, 2025 and at its other filings with the Securities and Exchange Commission.
Kelly Gura: Effect is required by law, seer disclaims any intention or obligation to update or revise any financial projections or forward-looking statements, whether because of new information, future events or otherwise.
Amid: This conference call contains prime sensitive information and is accurate only as of the live broadcast May 13th, 2025. With that, I would like to turn the call over to our meet.
Amid: Thanks Kelly, and thank you everyone for joining us this afternoon.
Amid: I will begin our talk today by providing updates on our business and I will then turn the call over to David to provide more detail on our financial results for the first quarter of 2025 as well as our outlook for the full year.
Beginning with Slide 3.
Amid: We have always believed that our technology will redefine the trajectory of proteomics and make a meaningful impact within the scientific community.
Amid: While near-term macroeconomic volatility, including the recently introduced tariffs, and ongoing government funding challenges are expected to persist and limit visibility for the balance of the year, our long-term vision and opportunity remains unchanged.
Amid: In fact, I am more confident in that belief than ever before.
Amid: We delivered a strong start to the year, with 4.2 million of revenue in the first quarter, driven by increasing demand for the Puerto Graf products suite.
Amid: We ship as many instruments in the first quarter as we're shipped in all of 2024 and saw continued traction for Seer Technology Access Center or STAC.
Amid: Our impact is clearly reflected in the high-quality data our customers are generating and the acceleration of publication that further validates the power of our technology.
Amid: were reiterating our full year 2025 revenue guidance of 17 to 18 million, representing 24% year over year growth at the midpoint.
Amid: As the policy landscape continues to evolve, we will closely monitor the impact of US policy changes on our customers as we navigate through this dynamic environment.
Amid: We continue to view our strong battlesheet of approximately 285 million cash, cash equivalent and investments as a key differentiator in the current environment and we remain disciplined in deploying it.
In this context,
Amid: We're making highly concentrated and impactful investments in R&D to execute on our product roadmap and continuing our shared repurchase program to benefit shareholders as we believe there is a significant dislocation between our core value proposition and what our stock price reflects today.
Amid: Well, we've not seen direct effects on our supply chain today from the recent health implementations.
Amid: Will confident in our strategy, our operational discipline, and the growing demand for deep unblast proteomics at scale.
Amid: Now, I'd like to walk through our recent progress in our core initiatives of validating and enhancing access to the Portugraph products suite in more detail.
Starting with the validation of a classroom on slide 4.
Amid: We proudly believe that the best-in-class quality and performance of the photograph product suite for deep unbiased proteomic scale makes us a trusted partner for our customers.
We started Seer.
to the complexity of the perennial for widespread research.
Amid: Here is based on an extremely strong scientific foundation for nanoparticle engineering that formed a basis for the polygraph product suite.
Amid: As I take a moment to reflect, I believe the growing body of evidence demonstrates that we have already executed on this vision by making the previously impractical unbiased for viewing studies readily possible today.
Amid: Our customers have repeatedly demonstrated the power of our technology and the differentiated biological insight they get from the photograph products week.
Amid: This is recognized in hundreds of abstracts, webinars, seminars and talks.
Amid: We now have 42 prospective publications, preprints and reviews, showcasing the capabilities of our platform, with many appearing in high impact journals.
Amid: Our customers are discovering novel biology that will solve challenges in human health, growing existing end-markets that leverage proteomics and creating entirely new end-markets that do not exist today.
Amid: The combination of the photograph and mass spec is enabling the scientific community to conduct unbiased proteomic studies with a step change in scale and complexity.
Amid: We see a future where millions of proteomes will be interrogated in an unbiased way, mirroring what we saw in genomics with increased throughput and accelerated reduction and reduction in cost.
Amid: But in proteomics, I believe this slope of adoption would be even steeper, the pace of discovery even more accelerated, and most importantly, the biological insight that will be on truly unprecedented.
Amid: In the past three years, we've started to see researchers move beyond pilot studies of tens of samples and opting to run studies of hundreds of samples and in many cases thousands.
Amid: To that end, I'm pleased to share that discovery life sciences, one of our centers of excellence and a leading Omis service provider in collaboration with us.
Amid: They concluded that the combination of the photograph product suite, the Orbitrap Astral, and the discoveries expertise in mass-spec proteomic services, would produce the deepest and most robust data set.
Amid: We are excited to be engaging in more conversations for larger scale projects, including multiple population scale studies that would leverage the program products week.
Amid: It's our platform to gain broader awareness. There's a clear shift towards significant larger studies, marking a key milestone for the proteomics market.
Amid: While the size and timing of these projects may lead to some quarterly revenue variability, the momentum is encouraging.
to enable the next generation of proteomics discovery.
Amid: While we believe that we have already changed the arc of deep unbiased proteomics, we are still at the very beginning of this journey.
Amid: But leveraging the photograph products we, our customers are starting to uncover novel biological insights.
Amid: Looking ahead, I'm really excited for our presence at the ASM's conference in a couple of weeks. The needs for our scalable deep-on-bias proteomics platform has never been greater.
Amid: Now moving to Slide 5 to take a closer look at our progress with accelerating access to the
Amid: We continue to see strong demand for staff which lowers the barrier of adoption of the
Amid: Stack allows the proteograph user to run samples in their own lab and have fear on the mass spec or alternatively provides end-to-end services from sample to proteomics data and analysis.
Amid: Encouragingly, in Q1, parts of our instrument shipments were acquired by customers who had previously access to those stacks.
Amid: representing the highest number of stacked instrument conversions in a single quarter. Furthermore, nearly half of stacked customers in Q1 were new.
Amid: Taken together, Stark continues to be an excellent source of revenue.
Amid: and concurrently self as a strategic and marketing asset while allowing users to experience the power of the portagraph and for some of these users to bring an instrument in house.
Amid: Arksmahti Murder is increasing, recognizing the value of our technology and the data that is being generated from it. Given the level of demand we're seeing, we have an expanded capacity of that.
Amid: We look forward to seeing more data generated on the purgeographs as more customers get access to our technology.
Amid: Our Strategic Instrument Placement Program, or SIP, continues to be an important catalyst for adoption. As a reminder, SIP removes barrier by utilizing available operating budgets for our customers who are capital constrained, particularly in the current macroeconomic environment.
Amid: Under this program, we will learn an instrument to a custom or a bit an up-run purchase of consumable kits a portion of our ship instruments in Q1 was through this program.
Amid: Now moving on to provide an update on our expanded partnership with Thermo Fisher Scientific to co-market and sell the polygraph products we alongside the Orbiter of Astral mass spectrometer.
Amid: As a reminder, this powerful pairing makes it possible for the first time to achieve population scale, deep unbiased proteomics with exceptional robustness and reproducibility.
Amid: In addition, this partnership further strengthens our commercial reach and makes it easier for our customers to access a seamless end-to-end solution for on-baths for theomics.
Amid: We completed training of the Thermo Fisher U.S. Salesforce in the first quarter, and the next phase of our partnership includes the training of the European Salesforce.
Amid: A respective sales teams are increasingly collaborating to identify and capture opportunities that are mutually beneficial and we have already seen traction in several regions.
Amid: In late April , Thermal Fisher Scientific hosted a compelling webinar featuring Dr. Brennan Keating that highlighted the impact of combining the photograph products we with Orbitrap as your mass spectrometer.
Amid: This study demonstrated how deep unbiased proteomics profiling can reveal critical physiologic and the logic changes in xenotransplant recipients.
These insights provided valuable information and transplanted organ viability.
Amid: and host responses, which are key factors in advancing being a transplantation as a viable solution to the organ shortage crisis.
Amid: Looking ahead, we have a number of customer webinars coming up to provide further insight into what is possible using the Portagraph product suite.
Amid: On a last-earning call, we highlighted the launch of our self-liced application on the Photograph XT, which extended the power of Photograph XT beyond plasma and tissue analysis.
Amid: We've been very pleased with the feedback around the newly launched Sunlighted application.
Amid: As a reminder, we now have over 10 protocols available to conduct proteomic analysis on a diverse list of sample types, including non-human plasma or serum.
Amid: Condition Media, Super Final Fluid, and Drive Blood samples. We plan to continue expanding the capabilities of the platform throughout the year.
Amid: I am deeply proud of the team's hard work and execution this quarter.
Speaker Change: Looking ahead, I'm even more excited for the new data and catalysts that are coming over the next few months and will serve as a tailwinds forceier. With that, I will not turn the icon over to David.
David Horn: Thanks, Amid. Turning to slide six, total revenue for the first quarter of 2025 was $4.2 million, representing an increase of 37% compared to $3.1 million in the first quarter of 2024. It was primarily due to higher instrument, consumable, and service revenue.
David Horn: Revenue recognized primarily consists of sales of paragraph instruments, the sumo kits and service revenue of which $52,000 was attributed to related parties.
David Horn: Product revenue for the first quarter of 2025 was $2.9 million, including $5,000 of related party revenue, and consisted of sales of paragraph instruments and consumable kits.
David Horn: As we meet mission, while we continue to see pressure on capex budgets and elongated sales cycles for the outright purchase of new instruments, we were pleased by the traction we saw in terms of instrument shipments in the first quarter.
David Horn: Service Revenue was $1.2 million for the first quarter of 2025, including $47,000 of related party revenue, and primarily consisted of revenue related to stack service projects.
David Horn: We continue to be encouraged by customer interest in running projects through stack and their ability to gain access to pretty graph data, including a significant number of new customers.
David Horn: Sample volumes increased on a year-over-year basis. As we have stated previously, we may continue to undertake projects for key strategic studies and other marketing efforts that will result in additional presentations and publications in the near term, but are conducted at a lower price point in our typical stack service projects.
David Horn: Other revenue was $60,000 for the first quarter of 2025 and Incisive Least in Shipping Revenue.
David Horn: Total gross profit was $2.1 million for the first quarter of 2025, representing a gross margin of 49%. Compared to $1.4 million in the first quarter of 2024, representing a gross margin of 44%.
David Horn: Gross margins were driven by a higher mix of service revenue in the first quarter of 2025 relative to the first quarter of 2024. We continue to expect variability in our gross margin on a quarter by quarter basis since the proportion of instrument consumable and service revenue will fluctuate in any given quarter.
David Horn: We continue to expect overall volatility in our gross margins on a quarterly basis.
David Horn: Total operating expenses for the first quarter of 2025 were $22.8 million, including $4.5 million of stock-based compensation. A decrease of 14% compared to $26.6 million, including $7.2 million of stock-based compensation in the first quarter of 2024.
David Horn: Research and development expenses for the first quarter of 2025 were $11.4 million, a decrease of 7% compared to the $12.3 million in the first quarter of 2024. The decrease in R&D expenses was primarily due to decreases in stock-based compensation and laboratory expenses.
David Horn: Spelling general administrative expenses for the first quarter of 2025 were $11.4 million, a decrease of 20% compared to $14.3 million in the first quarter of 2024. The decrease in SGNA expenses was primarily due to a decrease in stock based compensation expenses.
David Horn: That loss for the first quarter of 2025 was $19.9 million compared to $20.7 million in the first quarter of 2024.
David Horn: Free cash flow loss was approximately $12.1 million for the quarter-ended March 31, 2025. We continued to expect free cash flow loss to be in the range of $40-45 million for the year.
David Horn: In addition, we continued our share of purchase activities in the first quarter of 2025, since we continue to believe that there is a significant dislocation in our share price.
David Horn: In the first quarter, we referred to 352,000 Class A comment shares, an average price of a $1.91 per share.
David Horn: We ended the quarter with approximately 285 million dollars in cash cash equivalent to investments. Importantly, we believe that with our current cash cash equivalent to investments on hand, we have sufficient capital to reach cash flow breakeven.
David Horn: All long-term targetists have become a profitable company. We are balancing that goal with the investments needed to innovate and build the company to drive sustained growth in the future. We aim to continue managing our significant cash balance in an extremely prudent manner and believe that our strong balance sheet puts a set of significant advantage to capture the massive opportunity ahead.
David Horn: Turning out to our Outlook for the Year on Slide 7.
David Horn: We continue to expect revenue to be in the range of $17 to $18 million for 2025, representing the growth of 24% at the midpoint over the full year 2024.
David Horn: Our guidance range assumes our customers will continue to face budget pressures, government funding uncertainty, and macroeconomic volatility as it relates to tariffs.
David Horn: The NIH and government funding environment were made extremely uncertain and dynamic. As a reminder, in 2024, revenue from academic and government entities represented approximately 30% of our overall revenue.
David Horn: Any fluctuations in NIH, government, and academic funding may impact these customers in 2025.
David Horn: In the last week, we have seen potential tariffs for pharmaceutical companies to be discussed, which will add additional uncertainty for our commercial customers, the impact of which remains to be seen. While we encourage our results in Q1, particularly around instrument shipments, we also saw some customers pause spending given this uncertainty.
David Horn: Therefore, we remain cautious due to this significant macroeconomic uncertainty, but are reaffirming our revenue guidance at this time.
David Horn: In terms of tear of impact on us, we have not seen any direct effects on our supply chain since our key suppliers manufacture the products we purchased from them in the United States.
David Horn: Power, we are actively monitoring this rapidly evolving environment and our supply situation could change.
David Horn: On the revenue side, we do see potential implications and impact from the tariffs imposed by other countries on products originating in the United States, especially as it relates to China.
David Horn: We do not expect revenue related to our stock services to be impacted by tariffs.
David Horn: While the majority of our product sales are in the United States, approximately 25% of our total revenue is derived from product sales to customers who reside outside of the United States.
David Horn: While we do not anticipate a significant impact to sales to these customers, and our current exposure to China is limited, the environment remains extremely volatile and uncertain. We will continue to actively monitor the current environment for any changes that could impact us.
Amid: At this point, I would like to turn the call back to me for closing comments.
Thank you, David.
Moving on to Slide 8.
Amid: Our performance in the first quarter is a testament to the value our technology brings to our customers.
expanding our user base and continuing to enhance access.
Driving larger cohort studies.
Enabling more customers to generate meaningful and actionable biological insights.
Speaker Change: I look forward to keeping you updated on our progress and with that we will not open it up for questions. Operator?
Speaker Change: As a reminder, if you'd like to ask a question at this time, please 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 where we compile the Q&A roster.
Again, that is Star 111 to ask a question.
Speaker Change: We have a question from the line of Rachel Van Stahl with JP Morgan. Her line is now open.
Speaker Change: Hi, good afternoon. Thanks so much for taking the questions today. So one thing you talked about this life sciences project, can you just walk us through the magnitude of this on the Discovery Life Sciences project that you called out, and then how long do you expect that to last for?
Thank you so much.
Speaker Change: Let me have actually David comment on the DLF project that the relationship David has been managing for the last two years and it's a very exciting project. It's a 10,000 sample study, David.
David Horn: Yeah, thanks for the question, Rachel. This is a really interesting project that's been evolving over a number of quarters in that this particular customer wanted to look at a large 10,000 sample cohort that...
David Horn: in deep proteomics and to really try and understand potential biomarker signatures and other things. I can't go into a ton of detail yet, they are going to have a...
David Horn: a press release likely coming out over the next month or so, that will kind of go into detail. But really, it's the first of its kind database that we know of that's going to be created. And I think, as Amid mentioned in his remarks,
This is really something where they did an extensive analysis.
of all the available programic technologies.
David Horn: He came at the conclusion that the proteograph with the astral performed, you know, the service will be performed by discovery life sciences.
David Horn: would give them the best robust data set for this cohort such that they could then mine it for potential targets and biomarkers. So we're really excited about this. It's the first real kind of...
David Horn: Population Scale Study, and I think it's going to be really impactful in terms of the overall scientific impact of it. It will take some time. I'd say over the course of the next kind on a 12 to 18 months, I imagine, but it really just depends on how
David Horn: How quickly they kind of bring together the cohort and things like that. So we're excited about it and more details to come here over the next month or so.
David Horn: and Rachel, let me just add, let me just add the Davis comment in that.
You know, about nine months ago.
In September , and this was at the Morgan Stanley Conference,
David Horn: I alluded to the fact that 2025 is the year where we're going to start seeing population scale deep unbiased proteomics go live on the back of the proteograph product suite that enabled them.
David Horn: So, this 10,000 sample study is the first. I expect over the course of the coming months you'll hear other announcements of even larger studies.
and so the-
You know, we are in a new paradigm.
in terms of...
Deep, unbiased, mass-back-based, proteomics, really taking the scale.
David Horn: and I think the platform and the road map that we have.
David Horn: Even 100,000 samples, or hundreds of thousands of samples.
David Horn: are completely within the realm of reality in terms of cost-effectiveness, in terms of feasibility, and so I'm super excited to keep you informed over the coming months.
Speaker Change: Great. Thank you both on that color. Then maybe just in terms of the academic and government you can ask obviously you talked a little bit about that I'm in the prepared, but can you give us the updated expectation in terms of what are you expecting your US academic and government customers to decline for the full year? And then can you unpack for us a little bit in terms of the trends that you saw in March?
Speaker Change: Or excuse me, in the first quarter, and maybe just a month of March as well, but also what you saw in April , have you seen orders and trends across that customer group continue to get worse, or have they kind of stabilized at this point? Thanks.
Speaker Change: So as we had discussed with you at your conference, academic and government together is about 30% of a revenue.
Speaker Change: and that 30% breaks down into roughly 18% academic and 12% government.
So, um, Dan.
The guidance that we provided actually represents.
Speaker Change: Our expectation of weakening in terms of these two market segment.
Speaker Change: in 2025. Now that said, if I look at the Q1 of 2025, there was actually a very nice balance both in terms of revenue and in terms of instrument placement.
between academic and government and biopharma, so I think...
Speaker Change: To answer directly, I would say we're now stabilized but that said I would only caveat it by saying it's such a moving target.
Speaker Change: that maybe next week I would have a completely different perspective, but if everything stays as is, then I think we are more or less stable and are guidance for the year holds. David, you want to add additional color please?
Yeah, Rachel, thanks.
I do feel like [inaudible]
Speaker Change: Control Proposals that have been floated in the last couple days.
Um, but again, I think-
given our customer base, and given...
Speaker Change: Um, you know, our, our installed base and, and, and the prospects and the funnel we have.
Speaker Change: We feel like it really will come down to kind of a case-by-case basis.
Speaker Change: I do think it's important to remember that any reduction in the NIH budget will likely impact future grants and not existent grant funding. So what we are hearing from some of our customers is they do have funding for the balance of the year and it's a question of whether they seem to be able to have access to it, but it's going forward after that.
Speaker Change: that I think is the big question mark. So it kind of remains to be seen, but we are seeing a little, a little more weakness here in the second quarter relative to the first.
Thank you for joining us this morning. I'm David Horn.
Speaker Change: Perfect, that's it for me. Thanks so much, you guys. Thank you
Speaker Change: As a reminder, if you'd like to ask a question at this time, please press star 11 on your touchdown phone. Again, that is star 11 to ask a question.
Speaker Change: I'm showing no further questions in Q at this time, so that will conclude today's question and answer session.
Speaker Change: Disconcludes today's conference call. Thank you for participating. You may now disconnect.
Speaker Change: Jaden Rismay, David Horn, Omid Farokhzad, Jason Holcomb,
[music]
Katie: Jaden Rismay, Jaden Rismay, David Horn, Omid Farokhzad,