Revenue and Deferred Revenue

9 Months Ended

Sep. 30, 2022

Revenue Recognition and Deferred Revenue [Abstract]

Revenue and Deferred Revenue

REVENUE AND DEFERRED REVENUEProduct revenue consists of an instrument with embedded software essential to the instrument’s functionality, consumables and platform evaluation agreements. Service revenue primarily consists of revenue received from the generation and analysis of proteomic data on behalf of the customer. Related party revenue is comprised of both the

sale of products and services performed for PrognomIQ, as further discussed in Note 9. Grant revenues consist of services performed specifically for the reimbursement of research-related expenses.

Product Revenue

For the three and nine months ended September 30, 2022, the Company recognized $2.6 million and $7.1 million of product revenue to non-related customers, respectively. For the three and nine months ended September 30, 2021, the Company recognized $0.9 million and $1.7 million of product revenue to non-related customers, respectively.

As of September 30, 2022 and December 31, 2021, the Company recorded $0.1 million and $0.4 million of deferred revenue related to product sales, respectively.

Service Revenue

For the three and nine months ended September 30, 2022, the Company recognized $0.1 million and $0.2 million of service revenue to non-related customers, respectively.

As of September 30, 2022 and December 31, 2021, the Company recorded $0.2 million and $0 of deferred service revenue, respectively.

Deferred revenue activity for the period ended September 30, 2022 and December 31, 2021 are as follows (in thousands):

	September 30,		December 31,
	2022		2021
Balance, beginning of period	$	376	$	250
Additions	716		376
Revenue recognized	(767)		(250)
Balance, end of period	$	325	$	376

Transaction price allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and non-cancelable amounts that will be invoiced and recognized as revenues in future periods. As of September 30, 2022, $3.3 million of revenue is expected to be recognized from the remaining performance obligations, of which 79% is expected to be recognized within 12 months and the remainder thereafter.

For the three and nine months ended September 30, 2022, 21% and 26% of the Company’s total revenue, respectively, was generated outside of the United States, primarily from countries in Asia. For the three and nine months ended September 30, 2021, 18% and 22% of the Company’s total revenue, respectively, was generated outside of the United States, primarily in Asia.

For the three months ended September 30, 2022, three customers accounted for 33%, 18%, and 11% of the Company’s total revenue. For the nine months ended September 30, 2022, two customers accounted for 32% and 11% of the Company’s total revenue. For the three months ended September 30, 2021, three customers accounted for 37%, 23%, and 17% of the Company’s total revenue. For the nine months ended September 30, 2021, four customers accounted for 33%, 14%, 11%, and 10% of the Company’s total revenue.

Grant and Other Revenue

In August 2019, the Company received a notice of a Small Business Innovation Research (SBIR) grant award from the National Institutes of Health, which will provide funding of approximately $1.1 million to the Company for its development of research applications. In June 2020, the Company received a notice that additional grant consideration of $0.9 million would be awarded. In May 2022, the SBIR grant reached the end of the award period. During the three months ended September 30, 2022 and 2021, the Company recognized $0 and approximately

$10,000 of grant revenue, respectively, with respect to the award. During the nine months ended September 30, 2022 and 2021, the Company recognized $64,000 and $0.2 million of grant revenue, respectively, with respect to the award.