908 Devices Inc. (NASDAQ:MASS) Q3 2022 Earnings Call Transcript

Kevin Knopp: Yes. Yes. I’m happy to cover that. We’ve always said that the REBEL online, if you will, is more of a 2024 situation. What we’re really excited though is to offer other online products that can be a prelude for that and leveraging our trace analytics acquisition. So we’re very excited to have the first one of those get out into the market in early Q1 and a second one shortly thereafter. And so all these efforts are really trying to steer and push us further into that bio-processing 4.0 domain and adding to the offering of our analytes and the process parameters, but also introducing some elements of process control and getting us out there with that online analytics capability that then is more of a 2 step as we see to accelerate our REBEL online efforts, both development and commercially.

So we’re very excited about it and getting a strong road map where we’ve got some of these future products already out with KOLs and are getting some good feedback. I’m happy with that acquisition of TRACE analytics, very differentiated, and it enables online capability for multiple products that we’ve got on our road map here. And I think that’s a big differentiator from where 908 sits in that we’re able to spin new products and adapt because we have a pretty comprehensive set of technologies here. But yes, I’m very excited for that road map to come.

Puneet Souda: And then just lastly on MX-908, I mean you seem to be expanding the application base there with pesticides, other products and launch release and testing and things like that. So could you talk to us about sort of as we think about 2023, how diversified can the offering — product offering be from an applications perspective, obviously, Army and Forensic is a large component right now for you. But just maybe talk to us sort of what sort of diversification should we expect on the application base there?

Kevin Knopp: Yes, sure. The handheld, as you mentioned, are largely going into that forensic set of those acquisitions in some way back to fentanyl and the Opioid crisis and whether those are aerosol hazards or counterfeit drugs that people are swabbing on a surface and continuing to see growth there outside of the U.S. Army. We mentioned good growth in orders year-to-date outside of that U.S. Army work for those. You’re right, we are also always trying to expand our analytic panel and capabilities on our handhelds as well, and we did just announce more work we’ve been doing with the USDA, specifically the U.S. bar service to develop a pesticide library. It’s really for the environmental impact and safety impact around illegal use of pesticides on federal lands.

And we do see that, that’s a way for us to just get out there, explore have more conversations in that space. But yes, I think we’re excited where the handheld will continue to grow, and we now have over 1,800. And as we mentioned before, we’re working on new products there as well that we’ll keep shrinking down the form factor, and we think will be compelling driving cycles over the next couple of years as well. So yes, I think it’s a good platform for us that we’re continuing to invest and really want to own that handheld detection space.

Puneet Souda: Okay, thanks Kevin.

Operator: Our next question comes from the line of Matt Larew from William Blair.

Madeline Mollman: This is Madeline Mollman on for Matt Larew. One quick one for me. I think you said in the past that 1/3 of REBEL users had open blank purchase orders for consumables, meaning they were ordering multiple kits at a time. Have you seen any impact from these customers who are buying in bulk in terms of destocking? Is that a concern at all that they have now made large purchase orders, and they won’t be — they’ll be less pull-through for consumables going forward?