Cue Health Inc. (Nasdaq: HLTH), a healthcare technology company,
(“Cue") today reported financial results for fourth quarter and
full year 2021.
Key Highlights
- Reported total revenue of $192.5 million for the fourth quarter
of 2021, compared to $13.3M in the fourth quarter of 2020
- Full year revenue of $618.1 million in 2021, compared to $23.0
million in 2020
- Diluted EPS of $0.22 for the fourth quarter of 2021, compared
to a loss of $1.16 in the fourth quarter of 2020
- Full year diluted EPS of $0.59 in 2021, compared to a loss of
$2.90 in 2020
- Shipped more than 230,000 Cue Readers to date, almost doubling
the number of readers shipped through Q3 2021
- Today we have more than 220 directly contracted organizations
as customers, up from more than 80 at the end of the third quarter
2021
- Successfully launched virtual health platform to individual
consumers across the US
- Ended 2021 with cash and cash equivalents of $409.9
million
- Q1 FY22 revenue guidance range of $170 million to $180
million
“In the fourth quarter, we made great progress across our growth
drivers: building and diversifying our customer base, progressing
the expansion of our test menu, and introducing new digital
enhancements to our platform,” said Ayub Khattak, Chief Executive
Office and Co-Founder of Cue Health. “We’re driving this momentum
into 2022 as we plan to launch a number of clinical studies and
make multiple FDA submissions before year-end. With our growing
install base of nearly a quarter million Cue Readers and the
further integration of our diagnostics with virtual care
capabilities, we are executing on our strategy and advancing Cue’s
mission of making healthcare more timely and accessible for people
around the world.”
Fourth Quarter 2021 Financial Results
Revenue was $192.5 million for the fourth quarter of 2021, an
increase from $13.3 million in the fourth quarter of 2020. The
growth was driven by our production capacity ramp through 2021,
delivery on our U.S. Department of Defense (“U.S. DoD”) contract,
and expansion of our customer base across all customer
categories.
Private Sector revenue grew to 54.0%, or $104.0M, for the fourth
quarter of 2021. This is the first time Private Sector revenues
surpassed the Public Sector, reflecting growth in our customer
base.
Public Sector revenue was $88.5 million, and accounted for 46.0%
of revenues for the fourth quarter of 2021. During the quarter we
completed shipment of our contract with the U.S. DoD.
Disposable test cartridge revenue was $165.4 million for the
fourth quarter of 2021.
Product gross margin was 46.3% for the fourth quarter of 2021,
up from 7.2% in the fourth quarter 2020 due to the scale up
production and related efficiencies that resulted in more favorable
absorption of fixed costs on a per unit basis in 2021.
Operating expenses for the fourth quarter of 2021 were $66.3
million, excluding cost of revenues, compared to $19.0 million for
the fourth quarter of 2020. The increase was driven by growth in
our overall organization, digital marketing spend, and spend
related to product development.
Net income was $34.2 million for the fourth quarter of 2021
compared to net loss of $19.5 million in the fourth quarter of
2020. Earnings per diluted share was $0.22 for the fourth quarter
of 2021 compared to a loss of $1.16 per diluted share in the fourth
quarter 2020.
Full Year 2021 Financial Results
Revenue was $618.1 million for the full year 2021, an increase
from $23.0 million for the full year 2020.
Public Sector revenue was $385.3 million, an increase from $16.4
million for the prior year.
Private Sector revenue was $232.8 million, an increase from $6.5
million for the prior year.
Product gross margin was 55.1%, an increase from 2.9% for the
prior year.
Operating expenses, excluding cost of revenues, were $151.3
million, compared to $53.1 million for the prior year.
Net income was $86.4 million, an increase from a net loss $47.4
million for the prior year. Earnings per diluted share was $0.59,
compared to a loss of $2.90 for the prior year.
Adjusted net income was $164.5 million, an increase from a net
loss of $47.4 million for the prior year.
Cash and cash equivalents were $409.9 million as of December 31,
2021.
Guidance
Cue Health expects first quarter 2022 revenues in the range of
$170 million to $180 million.
About Cue Health
Cue Health (Nasdaq: HLTH) is a healthcare technology company
that makes it easy for individuals to access health information and
places diagnostic information at the center of care. Cue Health
enables people to manage their health through real-time,
actionable, and connected health information, offering individuals
and their healthcare providers easy access to lab-quality
diagnostics anywhere, anytime, in a device that fits in the palm of
the hand. Cue Health’s first-of-its-kind COVID-19 test was the
first FDA-authorized molecular diagnostic test for at-home and
over-the-counter use without a prescription and physician
supervision. Outside the United States, Cue Health has received the
CE mark in the European Union, Interim Order authorization from
Health Canada, regulatory approval from India’s Central Drugs
Standard Control Organisation, and PSAR authorization from
Singapore’s Health Sciences Authority. Cue Health was founded in
2010 and is headquartered in San Diego. For more information,
please visit www.cuehealth.com.
Forward-Looking Statements
Statements in this press release about future expectations,
plans and prospects, including statements related to the
commencement of any clinical studies, the submission of any FDA
applications, potential technology enhancements and future
performance and our guidance, including first quarter 2022
guidance, as well as any other statements regarding matters that
are not historical facts, may constitute “forward-looking
statements”. The words, without limitation, “anticipate,”
“believe,” “continue,” “could,” “estimate,” “expect,” “intend,”
“may,” “plan,” “potential,” “predict,” “project,” “should,”
“target,” “will,” “would,” “develop,” “progress,” “expand” and
similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain
these or similar identifying words. Actual results may differ
materially from those indicated by such forward-looking statements
as a result of various important factors, including those related
to the expected capabilities of the new Omicron-specific genotyping
Cue test, our ability to maintain customer growth rates, our
ability to increase private sector revenue, our ability maintain or
replace the revenue historically generated from our government
contracts, our ability to effectively scale our manufacturing
capacity to meet contractual obligations with our customers and
market demand, and the factors discussed in the "Risk Factors"
section of Cue’s Annual Report on Form 10-K for the year ended
December 31, 2021 to be filed with the SEC. Any forward-looking
statements contained in this press release are based on the current
expectations of Cue’s management team and speak only as of the date
hereof, and Cue specifically disclaims any obligation to update any
forward-looking statement, whether as a result of new information,
future events or otherwise.
This product has not been FDA cleared or approved; but has been
authorized by FDA under an Emergency Use Authorization, or EUA.
This product has been authorized only for the detection of nucleic
acid from SARS-CoV-2, not for any other viruses or pathogens. The
emergency use of this product is only authorized for the duration
of the declaration that circumstances exist justifying the
authorization of emergency use of in vitro diagnostics for
detection and/or diagnosis of COVID-19 under Section 564(b)(1) of
the Federal Food, Drug and Cosmetic Act, 21 U.S.C. §
360bbb-3(b)(1), unless the declaration is terminated or
authorization is revoked sooner.
CONDENSED STATEMENTS OF
OPERATIONS
(In thousands, except share
data)
Three Months Ended December
31,
Year Ended December
31,
2021
2020
2021
2020
Revenue
Product revenue
$
191,280
$
13,263
$
615,796
$
15,391
Grant and other revenue
1,226
—
2,311
7,562
Total revenue
192,506
13,263
618,107
22,953
Operating costs and expenses:
Cost of product revenue
102,796
12,310
276,542
14,951
Sales and marketing
21,198
650
28,729
714
Research and development
21,679
1,920
42,829
28,478
General and administrative
23,452
16,478
79,788
23,936
Total operating costs and expenses
169,125
31,358
427,888
68,079
Income (loss) from operations
23,381
(18,095
)
190,219
(45,126
)
Interest expense
(57
)
(100
)
(9,809
)
(374
)
Change in fair value of redeemable
convertible preferred stock warrants
—
(1,289
)
53
(1,289
)
Change in fair value of convertible
notes
—
—
(59,560
)
—
Loss on extinguishment of debt
—
—
(1,998
)
(610
)
Other income (expense), net
291
(52
)
272
47
Net income (loss) before income taxes
23,615
(19,536
)
119,177
(47,352
)
Income tax expense (benefit)
(10,615
)
—
32,759
—
Net income (loss)
$
34,230
$
(19,536
)
$
86,418
$
(47,352
)
Net income (loss) per share attributable
to common stockholders – basic
$
0.23
$
(1.16
)
$
0.63
$
(2.90
)
Weighted-average number of shares used in
computation of net income (loss) per share attributable to common
stockholders – basic
146,367,756
16,878,866
52,815,449
16,315,730
Net income (loss) per share attributable
to common stockholders – diluted
$
0.22
$
(1.16
)
$
0.59
$
(2.90
)
Weighted-average number of shares used in
computation of net income (loss) per share attributable to common
stockholders – diluted
152,531,173
16,878,866
59,635,384
16,315,730
CONDENSED BALANCE SHEETS
(In thousands, except share
amounts and share data)
December 31, 2021
December 31, 2020
Assets
Current assets:
Cash and cash equivalents
$
409,873
$
121,578
Restricted cash
13,837
6,000
Accounts receivable, net
104,589
4,168
Inventory
88,388
36,842
Prepaid expenses
45,889
13,847
Other current assets
7,446
1,263
Total current assets
670,022
183,698
Restricted cash, non-current
—
1,677
Property and equipment, net
177,456
103,683
Prepaid rent
1,567
16,771
Operating lease right-of-use assets
79,474
8,281
Intangible assets, net
7,673
2,038
Other non-current assets
3,868
180
Total assets
$
940,060
$
316,328
Liabilities, Redeemable Convertible
Preferred Stock and Stockholders’ Equity (Deficit)
Current liabilities:
Accounts payable
$
37,208
$
23,847
Accrued liabilities and other current
liabilities
29,498
8,822
Income taxes payable
8,297
—
Deferred revenue, current
82,165
115,747
Debt, current
—
5,434
Operating lease liabilities, current
7,147
797
Finance lease liabilities, current
2,621
1,249
Total current liabilities
166,936
155,896
Redeemable convertible preferred stock
warrant liabilities
—
1,331
Deferred revenue, net of current
portion
10,283
67,349
Operating leases liabilities, net of
current portion
46,464
10,472
Finance lease liabilities, net of current
portion
3,271
1,857
Other non-current liabilities
6,356
4,500
Total liabilities
233,310
241,405
Commitments and contingencies
Total redeemable convertible preferred
stock
—
176,323
Stockholders’ Equity (Deficit)
Preferred stock, $0.00001 par value;
50,000,000 and no shares authorized, no shares issued and
outstanding at December 31, 2021 and December 31, 2020,
respectively
—
—
Common stock, $0.00001 par value;
500,000,000 and 129,030,355 shares authorized, 146,402,991 and
27,995,780 issued and outstanding at December 31, 2021 and December
31, 2020, respectively
1
—
Additional paid-in-capital
730,767
9,036
Accumulated deficit
(24,018
)
(110,436
)
Total stockholders’ equity (deficit)
706,750
(101,400
)
Total liabilities, redeemable convertible
preferred stock and stockholders’ equity (deficit)
$
940,060
$
316,328
Non-GAAP Net Income (Loss)
(In thousands, except share
data)
Year Ended December
31,
2021
2020
Dollar Amount
Per Diluted Share
Dollar Amount
Per Diluted Share
Net income (loss)/diluted EPS
$
86,418
0.59
$
(47,352
)
(2.90
)
Fair value adjustments of convertible
notes
59,560
0.47
—
—
Banking and financing-related items
7,998
0.07
—
—
Forgiveness of promissory notes
12,880
0.10
—
—
Tax effects
(2,315
)
(0.02
)
—
—
Adjusted net income (loss)/adjusted
diluted EPS
$
164,541
$
1.21
$
(47,352
)
$
(2.90
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220329005938/en/
ICR Westwicke Caroline Corner ir@cuehealth.com (415)
202-5678
Cue Health press@cuehealth.com
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