908 Devices Inc. (NASDAQ:MASS) Q3 2023 Earnings Call Transcript

Unidentified Analyst: Great. Thanks.

Operator: Our next question comes from Jacob Johnson of Stephens. Jacob, the line is yours.

Jacob Johnson: Hey, thanks. Good morning. Maybe just Kevin to follow-up on the Terumo partnership. I heard you mentioned it was non-exclusive. Is this something that we should expect to see you kind of expand — maybe expand on this with other providers? And is that that kind of the go-to-market strategy for MAVEN where it’s good to partner with the — for lack of a better term, kind of bioreactor type offerings for cell therapy?

Kevin Knopp: Yeah I think you’re right on all accounts. I mean, we really see MAVEN as being a strong contributor to online analytics and giving these process development teams these kind of, call it, actionable insights. And MAVEN with the streaming out glucose and lactate, and then actually being able to also control, we think it makes a lot of sense to be partnered in various forms in various ways, whether it’s an OEM, whether it’s being friendly, whether it’s co-marketing agreements, collaboration agreements, really trying to have a full spectrum there to extend the reach of our sales team and really look to provide customers with more of a solution rather than just a device, if you will. So yes, I think we hope to show more examples of that as we go forward. And super excited to be working with Terumo, and as I mentioned already, working with Sartorius as well in the biologic space.

Jacob Johnson: Got it. That’s helpful. And then maybe Kevin, a kind of bigger picture capital allocation type question. Obviously a lot of effort on the desktop side the last couple years in terms of sales and marketing, but also kind of new product development. I’m just curious in the current macro environment where that business is a little more challenged and you’re seeing these opportunities on the handheld side. Are you focusing more of your time in the company’s resources on the handheld side of the business?

Kevin Knopp: Yeah, I think we’re doing two things. I mean, one, in this desktop space, we’re absolutely trying to use this time to build out that foundation, build out a really compelling set of complementary technologies and devices that can bring a holistic set of products to the PET space and really kind of marching towards that tri-quarter scanner-like device that’s just providing process and quality attributes. So we are absolutely doubling down in that, and we’re spending a lot of time making sure that we’ve got customers successful with all our product, and they’re really experiencing the benefits. And we’re showcasing Terumo today, but we work every day with each and every one of our customers out there for Rebel and all of our devices.

So absolutely a major focus, major resource area of effort and deployment for us. But with that said, handhelds has been impressive to us and has been overperforming to us in our plans to date. And we don’t see that stopping. We really see a lot of opportunity. The fentanyl crisis, opioid crisis, counterfeit pharmaceuticals, a lot of drivers out there that our team’s able to help with our customers and a solution. So we absolutely want to win that space and we’re investing in that space and we want to own that space. So we are continuing to make investments there and work on both R&D roadmaps, sales investments, market development.

Jacob Johnson: Thanks for that perspective and taking the questions.

Operator: [Operator Instructions] Our next question comes from Dan Arias of Stifel. Dan, please go ahead.

Daniel Arias: Hi, good morning, guys. Thanks. Kevin, maybe to your last point there, you have done a nice job this year backfilling the handheld order book post the army contract roll off. Obviously, we’re getting to the point of the year where we’re starting to look ahead. So I know we’ll need to wait for a little bit to get details on the outlook, but you both, you and Joe made comments on the things that you’re working here — working on here in 4Q. Can you just maybe touch on the way in which you see the sales funnel heading into 2024 for handhelds and then how you might compare the strength of that funnel to this time last year?