Cue Health Reports First Quarter 2022 Results

SAN DIEGO–(BUSINESS WIRE)–Cue Health Inc. (Nasdaq: HLTH), a health technology company (“Cue”), today released its financial results for the first quarter of 2022.

Recent Highlights

  • Revenues of $179.4 million in the first quarter of 2022, compared to $64.5 million in the first quarter of 2021

  • Over 235,000 Cue Readers shipped through the end of Q1 2022, including over 72,000 during the quarter

  • Covid-19 testing de novo submission to the U.S. Food and Drug Administration (FDA) for full clearance for home and point-of-care use

  • Influenza clinical studies nearing completion, with full FDA submission expected in Q3 2022

  • Influenza + COVID multiplex starts clinical studies this quarter, ahead of schedule

  • RSV is expected to begin clinical studies in the third quarter of 2022 and the Chlamydia + gonorrhea multiplex in the second half of 2022, as planned

  • Cash generated of $16.6 million in the first quarter of 2022, ending with cash and cash equivalents of $426.5 million

“I am pleased with our first quarter 2022 financial results, including $179 million in revenue, reflecting 178% year-over-year growth. We have made excellent progress in our menu expansion activities, with all of our programs on track or ahead of schedule,” said Ayub Khattak, co-founder, president and CEO of Cue Health. “Our recent COVID-19 test de novo The FDA submission marked an important milestone for the company and we believe this will be the first of many submissions as we seek to address a range of diseases and conditions with our menu of molecular diagnostic tests and future offerings. of care.

First quarter 2022 financial results

Revenue was $179.4 million in the first quarter of 2022, an increase from $64.5 million in the first quarter of 2021. The growth was primarily driven by the continued expansion of our customer base and the increase in production capacity.

Private sector revenue increased to 98.0%, or $175.8 million, in the first quarter of 2022.

Public sector revenue was 2.0%, or $3.6 million, in the first quarter of 2022, as we completed delivery of our contract with the U.S. Department of Defense in the fourth quarter of 2021.

Disposable test cartridge revenue was $163.2 million in the first quarter of 2022.

Product gross margin was 51.1% in the first quarter of 2022, compared to 53.4% ​​in the first quarter of 2021.

Operating expenses in the first quarter of 2022 were $89.9 million, excluding cost of revenues, compared to $19.7 million in the first quarter of 2021. The increase was due to the growth of our overall organization, digital marketing expenses and product development expenses.

Net income was $2.8 million in the first quarter of 2022, compared to $13.0 million in the first quarter of 2021. Diluted earnings per share were $0.02 in the first quarter of 2022, compared to 0 $.08 in the first quarter of 2021.

Cash and cash equivalents were $426.5 million as of March 31, 2022.

Orientation

Cue Health expects second-quarter 2022 revenue to be between $50 million and $55 million.

About Cue Health

Cue Health (Nasdaq: HLTH) is a health technology company that makes it easier for people to access health information and places diagnostic information at the center of care. Cue Health empowers people to manage their health with real-time, actionable, and connected health information, giving individuals and their healthcare providers easy access to lab-quality diagnostics anywhere, anytime , in a device that fits in the palm of your hand. Cue Health’s first COVID-19 test was the first molecular diagnostic test cleared by the FDA for home and over-the-counter use without a prescription or medical supervision. Outside the United States, Cue Health has received CE Marking in the European Union, Interim Prescription Clearance from Health Canada, Regulatory Approval from the Central Drugs Standard Control Organization of India, and Clearance PSAR from the Health Sciences Authority of Singapore. Cue Health was founded in 2010 and is headquartered in San Diego. For more information, please visit www.cuehealth.com.

Forward-looking statements

The statements in this press release about future expectations, plans and prospects, including statements relating to the submission of any application to the FDA and expectations regarding obtaining clearance, the growth of our customers, expectations regarding production capacity, potential technological improvements and future performance and our guidance, including the first quarter 2022 guidance, as well as any other statements regarding matters that are not historical facts, may constitute “forward-looking statements”. The words, but not limited to, “continue”, “estimate”, “expect”, “intend”, “may”, “plan”, “potential”, “would”, “develop “, “open”, “seek”, “offer”, “grow”, “expand” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words or words similar. Actual results may differ materially from those indicated by these forward-looking statements due to a variety of important factors, including those related to the expected capabilities of the new Omicron-specific Cue genotyping test, our ability to maintain customer growth rates, our ability to increase private sector revenue, our ability to maintain or replace revenue historically generated by 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 Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 is required to be filed with the SEC. All 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 cleared or approved by the FDA; but has been cleared by the FDA under an Emergency Use Authorization, or EUA. This product has been licensed for the detection of SARS-CoV-2 nucleic acid only, and not for other viruses or pathogens. Emergency use of this product is authorized only for the duration of the declaration of the existence of circumstances justifying the authorization of emergency use of in vitro diagnostics for the detection and/or diagnosis of COVID -19 under section 564(b)(1) of the Federal Act. Food, Drug and Cosmetic Act, 21 USC § 360bbb-3(b)(1), unless the declaration is terminated or the authorization is revoked sooner.

CONDENSED INCOME STATEMENTS

(In thousands, except shared data)

Three months completed

March, 31st,

2022

2021

Revenue

Product revenue

$

177,454

$

64,499

Grant and other income

1,956

Total revenue

179,410

64,499

Operating costs and expenses:

Product revenue cost

86,697

30,035

Sales and Marketing

34,168

430

Research and development

28,787

7,409

general and administrative

26,910

11,870

Total operating costs and expenses

176,562

49,744

Operating income (loss)

2,848

14,755

Interest expense

(51

)

(535

)

Other income (expenses), net

6

37

Net profit (loss) before income taxes

2,803

14,257

Income tax expense (benefit)

1,226

Net profit (loss)

$

2,803

$

13,031

Net earnings (loss) per share attributable to common shareholders – basic

$

0.02

$

0.09

Weighted average number of shares used in the calculation of net earnings (loss) per share attributable to common shareholders – basic

146,526,370

18,378,777

Net earnings (loss) per share attributable to common shareholders – diluted

$

0.02

$

0.08

Weighted average number of shares used in the calculation of net earnings per share attributable to ordinary shareholders – diluted

153 036 804

25,904,338

CONDENSED BALANCE SHEET

(In thousands, except share amounts and share data)

March, 31st,

2022

The 31st of December,

2021

Assets

Current assets:

Cash and cash equivalents

$

426 465

$

409,873

Restricted cash

13,838

13,837

Accounts Receivable

75,830

104,589

Inventory

132,567

88,388

Prepaid expenses

42,902

45,889

Other current assets

9,807

7,446

Total current assets

701 409

670,022

Property and equipment, net

182,750

177,456

Rent paid in advance

480

1,567

Operating lease right-of-use assets

84 212

79,474

Intangible assets, net

9,240

7,673

Other non-current assets

5,679

3,868

Total assets

$

983 770

$

940,060

Liabilities, redeemable convertible preferred shares and equity (deficit)

Current liabilities:

Accounts payable

$

48,842

$

37 208

Accrued expenses and other current liabilities

39,809

29,498

Taxes payable on income

8,246

8,297

Deferred income, current

84,629

82 165

Operating lease debts, current

7,594

7,147

Finance lease debts, outstanding

2,620

2,621

Total current liabilities

191,740

166,936

Deferred revenue, net of current portion

10,283

10,283

Liabilities related to operating leases, net of the current portion

47,626

46,464

Finance lease liabilities, net of current portion

2,627

3,271

Other non-current liabilities

6,356

6,356

Total responsibilities

258,632

233 310

Commitments and contingencies (Note 16)

Equity (deficit)

Common shares, par value $0.00001; 500,000,000 and 500,000,000 shares authorized, 146,958,296 and 146,402,991 issued and outstanding as of March 31, 2022 and December 31, 2021, respectively

1

1

Premium

746,352

730 767

Accumulated deficit

(21,215

)

(24,018

)

Total equity (deficit)

725 138

706 750

Total Liabilities, Redeemable Convertible Preferred Shares and Equity (Deficit)

$

983 770

$

940,060

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