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Fluidigm Q3 Revenues Drop 29 Percent on Supply Chain Issues, Waning COVID-19 Testing

NEW YORK – Fluidigm reported after the close of the market on Monday a 29 percent year-over-year decrease in third quarter revenues as COVID-19 test revenues retreated and supply chain issues affected other product fulfillment.

For the three months ended Sept. 30, the South San Francisco, California-based firm logged $28.5 million in revenues compared to $39.9 million a year ago.

Fluidigm's Q3 product revenues fell 25 percent to $21.9 million from $29.2 million, while its service revenues dropped about 2 percent to $6.0 million from $6.1 million. Other revenues retreated approximately ninefold to $551,000 from $4.5 million.

Base product and service revenue, excluding COVID-19 testing, was up about 2 percent to $25.6 million from $25.1 million.

"Core demand for our products was healthy, but we were unable to fulfill all orders for our products during the quarter, largely due to supply chain issues," Fluidigm CEO Chris Linthwaite said in a statement. "Our backlog of unfilled orders stands at more than $9 million, which is almost twice as much as our historic average. We expect to work through these pending orders over the next few quarters." He also noted that demand in the Asia-Pacific region was impacted by tax permit issues in China and COVID-related shutdowns in Japan.

In a conference call recapping Q3 earnings, Linthwaite noted that the company's innovation pipeline remains strong, as the company's recently launched CyTOF XT mass cytometry platform "gained significant traction" in Q3 with "notable interest from CROs; [and] pharma and translational centers, including those pursuing COVID vaccines and CAR-T cell therapy research."

In addition, the company delivered the first production units of the Olink Signature Q100, a microfluidic protein biomarker discovery platform Fluidigm designed and is manufacturing for proteomics firm Olink, and Linthwaite said that Fluidigm anticipates an increase in deliveries in Q4.

Finally, this week the company will launch the next generation of its BioMark microfluidic gene expression analysis platform, the BioMark X, which integrates the company's existing Juno sample prep platform and legacy BioMark HD instrument into one platform with sample-to-answer capabilities.

However, Linthwaite noted that the company expects supply chain issues to continue, and as such the company is executing a "phased launch" of BioMark X, resulting in "modest" revenue contributions for 2021. "The BioMark X and the Olink Signature Q100 instruments share certain components for which near-term supply availability is uncertain," Linthwaite said. "Our teams are working diligently to mitigate these issues, and are working directly with supply chain partners. However, this lack of visibility to supply chain reliability tempers our outlook for the near term."

Fluidigm also said that its board of directors, with assistance from outside financial, operating, and legal advisers, is undertaking a review of various options to maximize shareholder value, including with regards to strategic alternatives, cost and capital structure, and operations and supply chain. The firm said it has not set a timetable for completing the process and does not intend to disclose developments unless and until the board determines this to be appropriate or required.

Fluidigm's Q3 net loss ballooned to $13.8 million, or $.18 per share, from a net loss of $6.0 million, or $.08 per share, in the year-ago period. Adjusted net loss per share was $.07.

R&D spending jumped 14 percent to $9.2 million in Q3 from $8.1 million a year ago, while SG&A expenses grew 6 percent to $24.1 million from $22.7 million.

The company finished the quarter with $29.3 million in cash and cash equivalents.

Fluidigm revised its 2021 guidance downward, noting that it now expects full-year revenues of $123 million to $127 million compared to a previous range of $134 million to $140 million. This would represent a year-over-year revenue decline of 8 percent to 11 percent compared to a previously predicted range of 1 percent growth to 3 percent decrease. Fluidigm also said that it expects to incur a net loss of $63 million to $66 million for the year.

For the fourth quarter of 2021, Fluidigm expects total revenue of $31 million to $34 million.

In mid-morning Tuesday trading on the Nasdaq, shares of Fluidigm were down around 6 percent at $4.53.

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