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Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Current assets:
Cash and cash equivalents	$ 168,443	$ 29,033
Short-term investments	80,266	127,822
Short-term investments		127,822
Accounts receivable, net	22,016	27,153
Inventory, net	25,988	19,781
Prepaid expenses and other	3,198	8,818
Total current assets	299,911	212,607
Property and equipment, net	20,837	20,184
Operating lease right-of-use assets	23,511	24,648
Other assets	2,243	2,315
Total assets	346,502	259,754
Current liabilities:
Accounts payable	5,205	10,282
Accrued liabilities	5,012	4,973
Accrued compensation and other employee benefits	12,546	15,579
Customer deposits	3,289	6,389
Deferred revenue, current portion	5,008	3,997
Operating lease liabilities, current portion	4,319	3,766
Total current liabilities	35,379	44,986
Deferred revenue, net of current portion	1,040	976
Other long-term liabilities	0	322
Long-term debt, net	167,308	79,951
Operating lease liabilities, net of current portion	28,087	29,368
Total liabilities	231,814	155,603
Commitment and contingencies (Note 11)
Stockholders’ equity:
Preferred stock, $0.0001 par value, 15,000 shares authorized; none issued	0	0
Common stock, $0.0001 par value, 150,000 shares authorized; 37,937 and 36,298 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively	4	4
Additional paid-in capital	611,955	535,954
Accumulated other comprehensive income	438	145
Accumulated deficit	(497,709)	(431,952)
Total stockholders’ equity	114,688	104,151
Total liabilities and stockholders’ equity	$ 346,502	$ 259,754

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (in shares)	15,000,000	15,000,000
Preferred stock, shares issued (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	150,000,000	150,000,000
Common stock, shares issued (in shares)	37,937,000	36,298,000
Common stock, shares outstanding (in shares)	37,937,000	36,298,000

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Revenue:
Revenue	$ 22,604	$ 30,345	$ 49,209	$ 58,033
Costs and expenses:
Cost of product and service revenue	10,712	9,605	21,729	18,314
Research and development	15,739	17,029	33,241	33,056
Selling, general and administrative	19,912	22,499	45,633	45,935
Total costs and expenses	46,363	49,133	100,603	97,305
Loss from operations	(23,759)	(18,788)	(51,394)	(39,272)
Other income (expense):
Interest income	479	828	1,183	1,351
Interest expense	(4,116)	(1,889)	(6,999)	(3,637)
Other income (expense), net	332	(120)	(1,275)	(230)
Loss on extinguishment of debt and termination of revolving loan facility	0	0	(7,143)	0
Total other expense, net	(3,305)	(1,181)	(14,234)	(2,516)
Net loss before provision for income tax	(27,064)	(19,969)	(65,628)	(41,788)
Provision for income tax	(69)	(68)	(129)	(147)
Net loss	$ (27,133)	$ (20,037)	$ (65,757)	$ (41,935)
Net loss per share - basic and diluted (in dollars per share)	$ (0.72)	$ (0.57)	$ (1.76)	$ (1.26)
Weighted average shares used in computing basic and diluted net loss per share (in shares)	37,785	35,174	37,392	33,382
Total product and service revenue
Revenue:
Revenue	$ 21,144	$ 22,370	$ 45,640	$ 43,720
Collaboration revenue
Revenue:
Revenue	$ 1,460	$ 7,975	$ 3,569	$ 14,313

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Statement of Comprehensive Income [Abstract]
Net loss	$ (27,133)	$ (20,037)	$ (65,757)	$ (41,935)
Change in unrealized gain on available-for-sale debt securities	353	183	292	244
Comprehensive loss	$ (26,780)	$ (19,854)	$ (65,465)	$ (41,691)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Condensed Consolidated Statements of Changes in Stockholders' Deficit Statement - USD ($) shares in Thousands, $ in Thousands	Total	Accumulated Deficit	Other Comprehensive Loss	Additional Paid-in Capital	Common Stock
Balance at beginning (in shares) at Dec. 31, 2018					30,913
Balance at beginning at Dec. 31, 2018	$ 36,869	$ (391,256)	$ (40)	$ 428,162	$ 3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common stock issued (in shares)					3,175
Common stock issued in public offering, net of $4.7 million of issuance costs	68,273			68,273	$ 0
Warrants issued for common stock	698			698
Common stock issued for stock options and restricted stock units (in shares)					805
Common stock issued for stock options and restricted stock units	8,075			8,075
Common stock issued for employee stock purchase plan (in shares)					151
Common stock issued for employee stock purchase plan	939			939
Tax payments from shares withheld for equity awards (in shares)					0
Tax payments from shares withheld for equity awards	(1,299)			(1,299)
Stock-based compensation	2,882			2,882
Net loss	(21,898)	(21,898)
Other comprehensive income	61		61
Balance at end (in shares) at Mar. 31, 2019					35,044
Balance at end at Mar. 31, 2019	94,600	(413,154)	21	507,730	$ 3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock net of issuance costs of $1.4 million				4,700
Balance at beginning (in shares) at Dec. 31, 2018					30,913
Balance at beginning at Dec. 31, 2018	36,869	(391,256)	(40)	428,162	$ 3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(41,935)
Balance at end (in shares) at Jun. 30, 2019					35,367
Balance at end at Jun. 30, 2019	85,988	(433,191)	204	518,971	$ 4
Balance at beginning (in shares) at Dec. 31, 2018					30,913
Balance at beginning at Dec. 31, 2018	36,869	(391,256)	(40)	428,162	$ 3
Balance at end (in shares) at Dec. 31, 2019					36,298
Balance at end at Dec. 31, 2019	104,151	(431,952)	145	535,954	$ 4
Balance at beginning (in shares) at Mar. 31, 2019					35,044
Balance at beginning at Mar. 31, 2019	94,600	(413,154)	21	507,730	$ 3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Warrants issued for common stock	1,575			1,575
Common stock issued for stock options and restricted stock units (in shares)					323
Common stock issued for stock options and restricted stock units	4,591			4,590	$ 1
Stock-based compensation	5,076			5,076
Net loss	(20,037)	(20,037)
Other comprehensive income	183		183
Balance at end (in shares) at Jun. 30, 2019					35,367
Balance at end at Jun. 30, 2019	85,988	(433,191)	204	518,971	$ 4
Balance at beginning (in shares) at Dec. 31, 2019					36,298
Balance at beginning at Dec. 31, 2019	104,151	(431,952)	145	535,954	$ 4
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Equity component of convertible notes, net	58,543			58,543
Warrants issued for common stock	737			737
Common stock issued for stock options and restricted stock units (in shares)					948
Common stock issued for stock options and restricted stock units	6,969			6,969
Common stock issued for employee stock purchase plan (in shares)					50
Common stock issued for employee stock purchase plan	1,122			1,122
Exercise of common stock warrants, net (in shares)					407
Exercise of common stock warrants, net	0			0
Tax payments from shares withheld for equity awards (in shares)					0
Tax payments from shares withheld for equity awards	(2,006)			(2,006)
Stock-based compensation	4,303			4,303
Net loss	(38,624)	(38,624)
Other comprehensive income	(61)		(61)
Balance at end (in shares) at Mar. 31, 2020					37,703
Balance at end at Mar. 31, 2020	135,134	(470,576)	84	605,622	$ 4
Balance at beginning (in shares) at Dec. 31, 2019					36,298
Balance at beginning at Dec. 31, 2019	104,151	(431,952)	145	535,954	$ 4
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(65,757)
Balance at end (in shares) at Jun. 30, 2020					37,937
Balance at end at Jun. 30, 2020	114,688	(497,709)	438	611,955	$ 4
Balance at beginning (in shares) at Mar. 31, 2020					37,703
Balance at beginning at Mar. 31, 2020	135,134	(470,576)	84	605,622	$ 4
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common stock issued for stock options and restricted stock units (in shares)					234
Common stock issued for stock options and restricted stock units	2,673			2,673
Stock-based compensation	3,660			3,660
Net loss	(27,133)	(27,133)
Other comprehensive income	354		354
Balance at end (in shares) at Jun. 30, 2020					37,937
Balance at end at Jun. 30, 2020	$ 114,688	$ (497,709)	$ 438	$ 611,955	$ 4

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Operating activities
Net loss	$ (65,757)	$ (41,935)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense	8,094	7,958
Depreciation and amortization	2,814	2,377
Payment of accrued interest of long-term debt	(2,593)	0
Loss on extinguishment of long-term debt	7,143	0
Amortization of debt discount and deferred financing costs	3,454	343
Loss on equity securities	300	0
Amortization of premium (discount) on short-term investments	(150)	236
Non-cash operating lease expense	1,596	1,332
Conversion of accrued interest to long-term debt	0	941
Provision for inventory obsolescence and bad debts	14	592
Changes in operating assets and liabilities:
Accounts receivable	5,129	(1,752)
Inventory	(6,559)	(4,361)
Prepaid expenses and other assets	5,493	(3,488)
Accounts payable	(2,835)	(2,551)
Accrued liabilities	47	(200)
Accrued compensation and other employee benefits	(3,117)	(2,306)
Customer deposits	(3,100)	(798)
Deferred revenue	1,075	(4,624)
Operating lease liabilities	(1,187)	(920)
Net cash used in operating activities	(50,139)	(49,156)
Investing activities
Purchases of property and equipment	(5,365)	(1,147)
Proceeds from sale of short-term investments	17,218	0
Proceeds from maturity of short-term investments	69,284	60,120
Purchases of short-term investments	(38,804)	(102,579)
Net cash provided by (used in) investing activities	42,333	(43,606)
Financing activities
Proceeds from issuance of 2025 convertible senior notes	230,000	20,000
Fees paid for issuance of 2025 convertible senior notes	(7,403)	(100)
Repayment of long-term debt	(80,000)	0
Fees paid upon extinguishment of debt	(4,845)	0
Proceeds from sale of common stock, net	0	68,273
Proceeds from issuance of common stock warrants	737	1,306
Tax withholdings related to net share settlements of restricted stock units	(2,006)	(1,299)
Proceeds from issuance of common stock for employee stock purchase plan	1,122	939
Proceeds from exercise of stock options	9,641	12,665
Net cash provided by financing activities	147,246	101,784
Net increase in cash and cash equivalents	139,440	9,022
Effect of exchange rate changes on cash and cash equivalents	(30)	(7)
Cash and cash equivalents
Beginning of period	29,033	24,356
End of period	168,443	33,371
Operating lease right-of-use assets obtained in exchange for lease obligations	$ 449	$ 27,880

Description of Business	6 Months Ended
Description of Business	Jun. 30, 2020
Accounting Policies [Abstract]
Description of Business	Description of the Business NanoString Technologies, Inc. (the “Company”) was incorporated in the state of Delaware on June 20, 2003. The Company’s headquarters is located in Seattle, Washington. The Company’s proprietary optical barcoding chemistry enables direct detection, identification, and quantification of individual target molecules in a biological sample by attaching a unique color coded fluorescent reporter to each target molecule of interest. The Company currently markets and sells two platforms based on its proprietary technology, its nCounter Analysis System, and its GeoMx Digital Spatial Profiler, or GeoMx DSP system, both consisting of instruments and consumables, to academic, government, biopharmaceutical, and clinical laboratory customers. The Company has incurred losses to date and expects to incur additional losses for the foreseeable future. The Company continues to invest the majority of its resources in the development and growth of its business, including significant investments in new product development and sales and marketing efforts. The Company’s activities have been financed to date primarily through the sale of equity securities, the incurrence of indebtedness and through cash received by the Company pursuant to certain product development collaborations. In March 2020, the Company issued $230.0 million in aggregate principal amount of 2.625% Convertible Senior Notes due 2025 (“Convertible Notes”) in a private offering. The Convertible Notes are governed by an indenture dated March 9, 2020 between the Company and U.S. Bank, National Association, as trustee. The Company received net proceeds from the offering of $222.6 million. The Company used $88.6 million to repay in full all outstanding amounts borrowed and fees owed with the termination of the Company’s amended and restated term loan agreement (“2018 Term Loan”) with Capital Royalty Group, and the fees owed in connection with the termination of the Company’s revolving credit facility with Silicon Valley Bank. The Company intends to use the remainder of the net proceeds for general corporate purposes, including the continued development and commercialization of its GeoMx DSP system, the continued commercialization of its portfolio of nCounter-based products and for working capital needs. See Note 9. Long-term Debt, Net for more information. In March 2019, the Company completed an underwritten public offering of 3,175,000 shares of its common stock, including the exercise in full by the underwriters of their option to purchase 675,000 additional shares of common stock. An additional 2,000,000 shares were sold by a related party stockholder. The Company’s total gross proceeds were $73.0 million. The Company did not receive any proceeds from the sale of shares of common stock by the related party stockholder. After underwriter’s commissions and other expenses of the offering, the Company’s aggregate net proceeds were approximately $68.3 million.

Concentration of Risks	6 Months Ended
Concentration of Risks	Jun. 30, 2020
Risks and Uncertainties [Abstract]
Concentration of Risks	Concentration of Risks Financial instruments that potentially expose the Company to concentrations of credit risk consist principally of cash and cash equivalents, short-term investments and accounts receivable. Cash is invested in accordance with the Company’s investment policy, which includes guidelines intended to minimize and diversify credit risk. Most of the Company’s investments are not federally insured. The Company has credit risk related to the collectability of its accounts receivable. The Company performs initial and ongoing evaluations of its customers’ credit history or financial position and generally extends credit on account without collateral. Additionally, the Company evaluates collectability risk over the life of its receivables in order to establish an appropriate reserve for certain receivables that may become uncollectible in future periods. The Company has not experienced significant credit losses to date. During the six months ended June 30, 2020, the Company had no customers or collaborators that individually represented more than 10% of total revenue. The Company had one collaborator, Lam, that individually represented 16% of total revenue during the three and six months ended June 30, 2019. The Company had no customers or collaborators that represented more than 10% of total product and service revenue for the six months ended June 30, 2020 and 2019, respectively. The Company had no customers or collaborators that represented more than 10% of total accounts receivable as of June 30, 2020 or December 31, 2019. The Company is also subject to supply chain risks related to the outsourcing of the manufacturing and production of its instruments to sole suppliers. Although there are a limited number of manufacturers for instruments of this type, the Company believes that other suppliers could provide similar products on comparable terms. Similarly, the Company sources certain raw materials used in the manufacture of consumables from certain sole suppliers. The impact of the COVID-19 global pandemic has not had a significant impact on the Company’s ability to source raw materials or its instruments to date. However, a change in or loss of suppliers could cause a delay in manufacturing and a possible loss of sales, which would adversely affect operating results. Should COVID-19 continue to impact the global economy at the same or heightened levels during future periods, or if certain geographies where the Company’s key suppliers or manufacturing facilities are located are more severely impacted than others, this could negatively impact our ability to manufacture new products, fulfill customer orders, and collect from customers, which could adversely affect future operating results.

Short-term Investments

6 Months Ended

Jun. 30, 2020

Investments, Debt and Equity Securities [Abstract]

Short-term Investments

Short-term investments consisted of available-for-sale and equity securities as follows (in thousands):


Type of securities as of June 30, 2020	Amortized cost		Gross unrealized gains		Gross unrealized losses		Fair value
Corporate debt securities	$	50,859	$	291	$	—	$	51,150
U.S. government-related debt securities	20,009		118		—		20,127
Asset-backed securities	8,960		29		—		8,989
Total available-for-sale debt securities	$	79,828	$	438	$	—	$	80,266


Type of securities as of December 31, 2019	Amortized cost		Gross unrealized gains		Gross unrealized losses		Fair value
Corporate debt securities	$	78,243	$	89	$	(2)	$	78,330
U.S. government-related debt securities	26,966		37		—		27,003
Asset-backed securities	11,950		21		—		11,971
Total available-for-sale debt securities	$	117,159	$	147	$	(2)	$	117,304
Corporate equity securities	9,893		625		—		10,518
Total short-term investment securities	$	127,052	$	772	$	(2)	$	127,822

The fair values of available-for-sale debt securities by contractual maturity were as follows (in thousands):


	June 30, 2020		December 31, 2019
Maturing in one year or less	$	80,266	$	101,751
Maturing in one to three years	—		15,553
Total available-for-sale debt securities	$	80,266	$	117,304

Collaboration Agreements	6 Months Ended
Collaboration Agreements	Jun. 30, 2020
Deferred Revenue Disclosure [Abstract]
Collaboration Agreements	Collaboration Agreements Lam Research Corporation In August 2017, the Company entered into a collaboration agreement with Lam with respect to the development of the Company’s Hyb & Seq platform product candidate and related assays. Pursuant to the terms of the collaboration agreement, Lam contributed up to an aggregate of $50.0 million towards the project. Lam is eligible to receive certain single-digit percentage royalty payments from the Company on net sales of certain products and technologies developed under the collaboration agreement, if any such net sales are ever recorded. The maximum amount of royalties payable to Lam will be capped at an amount up to three times the amount of development funding actually provided by Lam. During the three and six months ended June 30, 2020, the Company recognized revenue related to the Lam agreement of $1.1 million and $2.9 million, respectively. During the three and six months ended June 30, 2019, the Company recognized revenue related to the Lam agreement of $4.4 million and $9.2 million, respectively. The Company received development funding of $2.7 million for the three and six months ended June 30, 2019. At June 30, 2020, the Company had recorded customer deposits of $1.9 million representing amounts received in advance. As of December 31, 2019, Lam had provided the full development funding commitment of $50.0 million and the Company does not expect to receive any further funding from Lam in future periods. In January 2020, having received the full commitment of development funding from Lam, the remaining warrants for shares of the Company’s common stock became exercisable and Lam elected to net exercise, in full, its warrant for 1.0 million shares of common stock, for which the Company issued an aggregate of 407,247 shares to Lam. In connection with Lam’s exercise of the warrant, the Company agreed to waive certain restrictions associated with the sale of the common stock in exchange for commitments by Lam related to the method and timing of Lam’s sale of the shares. Celgene Corporation In March 2014, the Company entered into a collaboration agreement with Celgene Corporation (“Celgene”) to develop, seek regulatory approval for, and commercialize a companion diagnostic using the nCounter Analysis System to identify a subset of patients with Diffuse Large B-Cell Lymphoma. In February 2018, the Company and Celgene entered into an amendment to their collaboration agreement in which Celgene agreed to provide the Company additional funding for work intended to enable a subtype and prognostic indication for the test being developed under the agreement for Celgene’s drug REVLIMID. Pursuant to its collaboration with Celgene, the Company had been developing an in vitro diagnostic test, LymphMark, as a potential companion diagnostic to aid in identifying patients with diffuse large B-cell lymphoma (DLBCL) for treatment. In April 2019, Celgene announced that the trial evaluating REVLIMID for the treatment of DLBCL did not meet its primary endpoint. In May 2019, the Company’s collaboration agreement with Celgene was terminated effective July 2019, with substantially all the remaining deferred revenue from the agreement recognized in the three months ended June 30, 2019. In addition, the Company does not intend to file a pre-market approval for LymphMark as a companion diagnostic for REVLIMID. During the six months ended June 30, 2019, the Company recognized revenue related to the Celgene agreement of $4.4 million. The Company received development funding of $0.2 million related to the Celgene collaboration for the three months ended June 30, 2019.

Commitments and Contingencies	3 Months Ended
Commitments and Contingencies	Mar. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies From time to time, the Company may become involved in litigation relating to claims arising from the ordinary course of business. Additionally, the Company operates in various states and local jurisdictions for which sales, occupation, or franchise taxes may be payable to certain taxing authorities. Management believes that there are no claims or actions pending against the Company currently, the ultimate disposition of which would have a material adverse effect on the Company’s consolidated results of operations, financial condition or cash flows.

Basis of Presentation and Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2020
Accounting Policies [Abstract]
Basis of Presentation and Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements reflect the accounts of the Company and its wholly-owned subsidiaries. The unaudited condensed consolidated balance sheet at December 31, 2019 has been derived from the audited consolidated financial statements at that date but does not include all information and disclosures required by generally accepted accounting principles in the United States of America (“U.S. GAAP”) for annual financial statements. These unaudited condensed consolidated financial statements and notes should be read in conjunction with the Company’s audited consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) and U.S. GAAP for unaudited condensed consolidated financial information. Accordingly, they do not include all information and footnotes required by U.S. GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements reflect all adjustments consisting of normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of the Company’s financial position and results of its operations as of and for the periods presented. Unless indicated otherwise, all amounts presented in financial tables are presented in thousands, except for per share and par value amounts. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Given the global economic climate and additional or unforeseen effects from the COVID-19 pandemic, certain estimates are becoming more challenging, and actual results could differ materially from those estimates. The results of the Company’s operations for the three and six month periods ended June 30, 2020 are not necessarily indicative of the results to be expected for the full year or for any other period. Revenue Recognition The Company recognizes revenue when control of the promised goods or services is transferred to its customers, in an amount that reflects the consideration expected to be received in exchange for those products and services. This process involves identifying the contract with a customer, determining the performance obligations in the contract, determining the contract price, allocating the contract price to the distinct performance obligations in the contract, and recognizing revenue when the performance obligations have been satisfied. A performance obligation is considered distinct from other obligations in a contract when it provides a benefit to the customer either on its own or together with other resources that are readily available to the customer and is separately identified in the contract. Performance obligations are considered satisfied once the Company has transferred control of a product or service to the customer, meaning the customer has the ability to use and obtain the benefit of the product or service. The Company recognizes revenue for satisfied performance obligations only when there are no uncertainties regarding payment terms or transfer of control. The Company generates the majority of its revenue from the sale of its proprietary nCounter Analysis System and GeoMx DSP System, and related consumables. Services consist of instrument service contracts and service fees for assay processing. The Company at times may enter into collaboration agreements that may generate upfront fees, and in some cases subsequent milestone payments that may be earned upon completion of certain product development milestones or other designated activities. For collaboration agreements of this type, the Company estimates the expected total cost of product development and other services under these arrangements and recognizes collaboration revenue using a contingency-adjusted proportional performance model. The Company may also recognize revenue from collaboration agreements that do not include upfront or milestone-based payments and generally recognizes revenue on these types of agreements based on the timing and amount of development activities. Expenses incurred in relation to research activities conducted in conjunction with our collaboration partners are recognized when the related activities have occurred and are classified in the statement of operations, generally as research and development expense. From period to period, collaboration revenue can fluctuate substantially based on the level of product development activities devoted to these collaborations, based on achievement or probable achievement of product development or other milestones, or as estimates of total expected collaboration product development or other costs are changed or updated. Convertible Senior Notes In accordance with accounting guidance for debt with conversion and other options, the Company separately accounted for the liability and equity components of the 2.625% Convertible Senior Notes due 2025 (“Convertible Notes”) by allocating the proceeds between the liability component and the embedded conversion feature, or the equity component, due to the Company’s ability to settle the Convertible Notes in cash, common stock or a combination of cash and common stock, at its option. The Company’s current intent is to settle the principal amount of the Convertible Notes in cash upon conversion, with any remaining conversion value being delivered in shares of its common stock. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. The allocation was performed in a manner that reflected the Company’s non-convertible debt borrowing rate for similar debt. The equity component of the Convertible Notes was recognized as a debt discount and represents the difference between the proceeds from the issuance of the Convertible Notes and the fair value of the liability of the Convertible Notes on their respective dates of issuance. The excess of the principal amount of the liability component over its carrying amount is the debt discount and is amortized to interest expense using the effective interest method over five years. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. In connection with the issuance of the Convertible Notes, the Company also incurred certain financing costs associated directly with the issuance of the Convertible Notes. These issuance costs will be deferred, and a portion of the deferred issuance costs have been deemed attributable to the equity component and have been allocated to additional paid-in capital. The remaining deferred issuance costs will also be amortized to interest expense over five years using the effective interest method. See Note 9. Long-term Debt, Net for additional information regarding the Convertible Notes. Leases The Company determines if an arrangement is a lease at inception of a contract. The Company’s leasing portfolio is comprised of operating leases primarily for general office, manufacturing, and research and development purposes. Operating lease liabilities and the corresponding right-of-use assets are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The operating lease right-of-use asset is reduced by lease incentives included in the agreement. As the existing leases do not contain an implicit interest rate, the Company estimates its incremental borrowing rate based on information available at commencement date in determining the present value of future payments. The Company includes options to extend the lease in the lease liability and right-of-use asset when it is reasonably certain that the option will be exercised. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. For our short-term leases, we recognize lease payments as an expense on a straight-line basis over the lease term. Recently Adopted Accounting Pronouncements In June 2016, the FASB issued “ASU 2016-13, Financial Instruments: Credit Losses.” The standard requires disclosure regarding expected credit losses on financial instruments at each reporting date, and changes how other than temporary impairments on investment securities are recorded. The Company adopted the ASU on January 1, 2020 using the modified retrospective transition approach and the adoption did not have a material impact on its condensed consolidated results of operations, financial condition, cash flows and financial statement disclosures for the three or six month periods ended June 30, 2020. In August 2018, the FASB issued “ASU 2018-15, Intangibles — Goodwill and other — Internal-use software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” The standard aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The Company adopted the standard, on a prospective basis, on January 1, 2020. Historically, the Company has had a practice of expensing the implementation costs related to cloud computing arrangements. Upon adoption of the standard, the Company may capitalize certain implementation costs for new cloud computing arrangements in other assets, and amortize the costs over the related service contract period for the hosted arrangement. The amortization of the implementation costs and the related service contract costs will be presented in its results of operations. The adoption did not have a material impact to the condensed consolidated results of operations, financial condition, cash flows, and financial statement disclosures for the three or six month periods ended June 30, 2020. In November 2018, the FASB issued “ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606.” The new guidance clarifies when certain transactions between collaborative arrangement participants which should be accounted for as revenue under Topic 606. The Company adopted the standard on January 1, 2020. The Company has assessed its collaborative arrangements and concluded no adjustment is necessary, based on guidance in the standard. In December 2019, the FASB issued “ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” The new guidance simplifies the accounting for income taxes, eliminates certain exceptions within ASC 740, Income Taxes, and clarifies certain aspects of the current guidance to promote consistency among reporting entities. ASU 2019-12 is effective for fiscal years beginning after December 15, 2021, with early adoption permitted. Most amendments within the standard are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. The Company adopted this ASU effective January 1, 2020 and, as a result, was able to determine the effect of income or loss from continuing operations using a computation that does not consider the tax effects of items that are not included in continuing operations. As such, for the three and six month periods ended June 30, 2020, the Company did not record a tax expense or benefit in its net loss from operations related to deferred tax assets and liabilities associated with its Convertible Notes. See to Note 9. Long-term Debt, Net for additional information. Recent Accounting Pronouncements

Revenue from Contracts with Customers

6 Months Ended

Jun. 30, 2020

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

The Company operates as a single reportable segment. The Company has one sales force that sells the Company’s nCounter and GeoMx DSP instruments, consumables and related services.

Disaggregated Revenues

The following table of total revenue is based on the geographic location of end users or distributors who purchase products and services, and of our collaborators. For sales to distributors, their geographic location may be different from the geographic location of the ultimate end user. For collaboration agreements, revenues are derived from partners located primarily in the United States. Americas consists of the United States, Canada, Mexico, and South America; and Asia Pacific includes Japan, China, South Korea, Singapore, Malaysia, India, and Australia.

The following table provides information about disaggregated revenue by major product line and primary geographic market (in thousands):


	Three Months Ended June 30, 2020														Six Months Ended June 30, 2020
	Americas		Europe and Middle East		Asia Pacific		Total		Americas		Europe and Middle East		Asia Pacific		Total
Product revenue:
Instruments	$	6,577	$	2,475	$	748	$	9,800	$	13,658	$	4,263	$	1,713	$	19,634
Consumables	5,375		2,406		588		8,369		13,747		4,909		1,213		19,869
Total product revenue	11,952		4,881		1,336		18,169		27,405		9,172		2,926		39,503
Service revenue	1,922		878		175		2,975		3,960		1,752		425		6,137
Total product and service revenue	13,874		5,759		1,511		21,144		31,365		10,924		3,351		45,640
Collaboration revenue	1,460		—		—		1,460		3,569		—		—		3,569
Total revenues	$	15,334	$	5,759	$	1,511	$	22,604	$	34,934	$	10,924	$	3,351	$	49,209


	Three Months Ended June 30, 2019														Six Months Ended June 30, 2019
	Americas		Europe and Middle East		Asia Pacific		Total		Americas		Europe and Middle East		Asia Pacific		Total
Product revenue:
Instruments	$	3,596	$	960	$	384	$	4,940	$	5,786	$	2,490	$	982	$	9,258
Consumables	8,840		4,666		882		14,388		17,444		9,723		1,681		28,848
Total product revenue	12,436		5,626		1,266		19,328		23,230		12,213		2,663		38,106
Service revenue	2,167		682		193		3,042		3,962		1,295		357		5,614
Total product and service revenue	14,603		6,308		1,459		22,370		27,192		13,508		3,020		43,720
Collaboration revenue	7,975		—		—		7,975		14,313		—		—		14,313
Total revenues	$	22,578	$	6,308	$	1,459	$	30,345	$	41,505	$	13,508	$	3,020	$	58,033

Total revenue in the United States was $33.8 million and $40.4 million for the six months ended June 30, 2020 and 2019, respectively. The Company’s assets are primarily located in the United States and not allocated to any specific geographic region. Substantially all of the Company’s long-lived assets are located in the United States.

Contract balances and remaining performance obligations

Contract liabilities are comprised of the current and long-term portions of deferred revenue of $6.0 million and $5.0 million as of June 30, 2020 and December 31, 2019, respectively, and customer deposits of $3.3 million and $6.4 million as of June 30, 2020 and December 31, 2019, respectively, included within the condensed consolidated balance sheets. Total contract liabilities decreased by $2.0 million for the six months ended June 30, 2020 as a result of the recognition of previously deferred revenue and customer deposits of $6.8 million for the completion of certain performance obligations during the period, partially offset by an increase of $4.8 million related to additional deferred revenue associated primarily with new or extended service contracts. The Company did not record any contract assets as of June 30, 2020.

As of June 30, 2020, unsatisfied or partially unsatisfied performance obligations related to the collaboration agreement with Lam Research Corporation (“Lam”) were $1.9 million. Performance obligations related to undelivered products and

service contracts as of June 30, 2020 were $7.5 million and are expected to be completed over the term of the related contract or as products are delivered.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

+ Details

Net Loss Per Share

6 Months Ended

Jun. 30, 2020

Earnings Per Share [Abstract]

Net Loss Per Share

Net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding. Outstanding stock options, restricted stock units, and warrants have not been included in the calculation of diluted net loss per share because to do so would be anti-dilutive. Accordingly, the numerator and the denominator used in computing both basic and diluted net loss per share for each period are the same.

The following shares underlying outstanding options, restricted stock units, and warrants were excluded from the computation of basic and diluted net loss per share for the periods presented (in thousands):


	Three Months Ended June 30,			Six Months Ended June 30, 2020
	2020	2019	2020	2019
Options to purchase common stock	3,501	4,765	3,724	4,801
Restricted stock units	1,578	1,641	1,515	1,578
Common stock warrants	479	1,013	538	960
Stock appreciation rights	13	—	7	—

Fair Value Measurements

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Fair Value Measurements

The Company establishes the fair value of its assets and liabilities using the price that would be received to sell an asset or paid to transfer a financial liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy is used to measure fair value. The three levels of the fair value hierarchy are as follows:

•Level 1 — Quoted prices in active markets for identical assets and liabilities.

•Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.

•Level 3 — Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

The recorded amounts of certain financial instruments, including cash, accounts receivable, prepaid expenses and other, accounts payable and accrued liabilities, approximate fair value due to their relatively short-term maturities.

The Company’s investments by level within the fair value hierarchy were as follows (in thousands):


As of June 30, 2020	Level 1		Level 2		Level 3		Total
Cash equivalents:
Money market fund	$	160,982	$	—	$	—	$	160,982
Short-term investments:
Corporate debt securities	—		51,150		—		51,150
U.S. government-related debt securities	—		20,127		—		20,127
Asset-backed securities	—		8,989		—		8,989

Total	$	160,982	$	80,266	$	—	$	241,248

As of December 31, 2019	Level 1		Level 2		Level 3		Total
Cash equivalents:
Money market fund	$	22,152	$	—	$	—	$	22,152
Short-term investments:
Corporate debt securities	—		78,330		—		78,330
U.S. government-related debt securities	—		27,003		—		27,003
Asset-backed securities	—		11,971		—		11,971
Corporate equity securities	10,518		—		—		10,518
Total	$	32,670	$	117,304	$	—	$	149,974

In March 2020, the Company issued $230.0 million of Convertible Notes. As of June 30, 2020, the fair value of the Convertible Notes was $211.9 million. The estimated fair value of the Convertible Notes, which are classified as Level 2 financial instruments, was determined based on the estimated or actual bid prices of the Convertible Notes in an over-the-counter market. See Note 9. Long-term Debt, Net for more information.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Inventory

6 Months Ended

Jun. 30, 2020

Inventory Disclosure [Abstract]

Inventory

Inventory, net of related allowances, consisted of the following as of the date indicated (in thousands):


	June 30, 2020		December 31, 2019
Raw materials	$	6,996	$	4,620
Work in process	5,930		4,617
Finished goods	13,062		10,544
Total inventory, net	$	25,988	$	19,781

Long-term Debt

6 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

Long-term Debt

Long-term Debt, Net

Convertible Notes

In March 2020, the Company issued $230.0 million in aggregate principal amount of 2.625% Convertible Senior Notes due 2025 (“Convertible Notes”) in a private offering. The Convertible Notes are governed by an indenture dated March 9, 2020 between the Company and U.S. Bank, National Association, as trustee.

The Company received net proceeds from the offering of $222.6 million. The Company used $88.6 million to repay in full all outstanding amounts borrowed and fees owed in connection with the termination of the Company’s amended and restated term loan agreement (“2018 Term Loan”) with Capital Royalty Group, and the fees owed in connection with the termination of the Company’s revolving credit facility with Silicon Valley Bank. The Company intends to use the remainder of the net proceeds for general corporate purposes, including the continued development and commercialization of its GeoMx DSP system, the continued commercialization of its portfolio of nCounter-based products and for working capital needs.

The Convertible Notes bear interest at a rate of 2.625% per year, payable semi-annually in arrears on March 1 and September 1, beginning on September 1, 2020. The Convertible Notes may bear additional interest under specified circumstances relating to the Company’s failure to comply with its reporting obligations under, or if the Convertible Notes are not freely tradeable as required by, the indenture governing the Convertible Notes. Upon conversion, the Convertible Notes will be convertible into cash, shares of common stock or a combination of cash and shares of common stock, at the Company’s election. The Company’s current intent is to settle the principal amount of the Convertible Notes in cash upon conversion, with any remaining conversion value being delivered in shares of its common stock.

The Convertible Notes are general unsecured senior obligations and will mature on March 1, 2025, unless earlier repurchased, redeemed or converted, subject to satisfaction of certain conditions and during the periods described below. The initial conversion rate for the Convertible Notes is 20.9161 shares of common stock, par value $0.0001 per share, per $1,000 principal amount of Convertible Notes (which is equivalent to an initial conversion price of approximately $47.81 per share). The conversion rate will be subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest. In addition, following certain corporate events that may occur prior to the maturity date or if the Company issues a notice of redemption, the Company will increase the conversion rate for a holder who elects to convert its Convertible Notes in connection with such corporate event or in connection with such redemption, as the case may be, in certain circumstances.

Prior to the close of business on the business day immediately preceding December 1, 2024, the Convertible Notes will be convertible only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on June 30, 2020 (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business-day period after any five consecutive trading-day period in which the trading price per $1,000 principal amount of Convertible Notes for each trading day of such period was less than 98% of the product of the last reported sale price of the common stock and the conversion rate on each such trading day; (3) if the Company calls any or all of the Convertible Notes for redemption, the Convertible Notes called for redemption (or, in the case of a partial redemption, if the Company makes an election to redeem all Convertible Notes, irrespective of whether they are called for redemption, to be convertible, all Convertible Notes) may be submitted for conversion at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date as set forth in the related redemption notice; or (4) upon the occurrence of specified corporate events. On or after December 1, 2024, until the close of business on

the business day immediately preceding the maturity date, holders of the Convertible Notes may convert all or any portion of their Convertible Notes at any time, regardless of the foregoing circumstances.

The Company may not redeem the Convertible Notes prior to March 5, 2023, and no sinking fund is provided for the Convertible Notes. On or after March 5, 2023, the Company may redeem for cash all or any portion of the Convertible Notes, at its option, if the last reported sale price of the common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading-day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides a notice of redemption at a redemption price equal to 100% of the principal amount of the Convertible Notes to be redeemed, plus any accrued and unpaid interest to, but excluding, the redemption date.

Upon the occurrence of a fundamental change (as defined in the indenture governing the Convertible Notes) prior to the maturity date, subject to certain conditions, holders may require the Company to repurchase all or a portion of the Convertible Notes in increments of $1,000 for cash at a price equal to 100% of the principal amount of the Convertible Notes to be repurchased, plus any accrued and unpaid interest to, but excluding, the fundamental change repurchase date.

The Convertible Notes do not contain any financial or operating covenants or any restrictions on the issuance of other indebtedness or the issuance or repurchase of securities by the Company. The Convertible Notes indenture contains customary events of default, including that upon certain events of default, 100% of the principal and accrued and unpaid interest on the Convertible Notes will automatically become due and payable.

As the Company has the ability to settle the Convertible Notes in cash, common stock or a combination thereof, the Company separately accounted for the embedded conversion feature of the Convertible Notes by allocating proceeds between a liability and an equity component. The initial amount of the liability component of $169.5 million was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. The borrowing rate was determined to be 9.35% based on the market rates for nonconvertible debt instruments issued by other companies with publicly available credit ratings considered to be comparable to the Company. The residual between the proceeds from the issuance of $230.0 million and the fair value of the liability component of $169.5 million is allocated to the equity component (residual method), which was recorded at $60.5 million and recognized as a debt discount. The Company incurred approximately $7.4 million of debt issuance costs, which primarily consisted of underwriting, legal and other professional fees directly associated with the issuance. The issuance costs were allocated to the liability and equity component proportionately based on the allocation of total proceeds. The equity component, net of issuance costs of $1.9 million, was recorded in additional paid-in capital in the Company’s condensed consolidated balance sheets and will not be remeasured as long as it continues to meet the conditions for equity classification. The liability component, net of issuance costs of $5.5 million, was recorded as long-term debt, net in the Company’s condensed consolidated balance sheets. The debt discount and debt issuance costs allocated to the liability component will be amortized to interest expense using the effective interest method over five years, the term of the Convertible Notes.

While the Convertible Notes are classified on the Company’s condensed consolidated balance sheet at June 30, 2020 as long-term, the resulting balance sheet classification of this liability will be monitored at each quarterly reporting date and will be analyzed dependent upon whether the Convertible Notes are convertible or subject to an event triggering potential redemption during the prescribed measurement periods. In the event that the holders of the Convertible Notes have the election to convert the Convertible Notes or the Convertible Notes become redeemable at any time during the prescribed measurement period, the Convertible Notes would then be considered a current obligation and classified as such.

While for GAAP purposes, the Convertible Notes are allocated between the liability component and the equity component, for U.S. tax purposes there is no allocation, and a deferred tax liability is recognized related to such difference. Because the Company has a full valuation allowance recorded against its net deferred tax assets, there is no net impact on the Company’s condensed consolidated balance sheets or condensed consolidated statements of operations as a result of establishing this deferred tax liability.

All future principal payments related to the Convertible Notes are due in March 2025. The outstanding balances of the Company’s Convertible Notes and previously outstanding term loan consisted of the following (in thousands):


	June 30, 2020		December 31, 2019
Outstanding principal of Convertible Note	$	230,000	$	—
Borrowings under term loan agreement	—		80,000
Paid-in-kind interest on term loan agreement	—		2,593
Less: unamortized debt discounts and issuance costs	(62,692)		(2,642)
Long-term debt, net	$	167,308	$	79,951
Fair value of outstanding Convertible Notes	$	211,888
Amount by which the Convertible Notes if-converted value exceeds their principal amount	$	—

Net carrying amount of equity component of Convertible Notes	$	58,543

The following table sets forth total interest expense recognized related to the Convertible Notes (in thousands):


	June 30, 2020
	Three Months Ended		Six Months Ended
Contractual interest expense	$	1,509	$	1,895
Amortization of debt discount and issuance costs	2,604		3,254
Total interest expense	$	4,113	$	5,149

Term Loan Agreement

In October 2018, the Company entered into an amended and restated term loan agreement with Capital Royalty Group (the “2018 Term Loan”), under which it could borrow up to $100.0 million, which was due and payable in September 2024. The 2018 Term Loan accrued interest at a rate of 10.5%, payable quarterly, of which 3.0% could be deferred, at the Company’s election, during the six-year term and repaid at maturity together with the principal. The Company paid an upfront fee of 0.5% of the aggregate principal amount of the initial borrowing under the 2018 Term Loan, and was required to pay a facility fee equal to 2.0% of the total amount borrowed including any deferred interest at the time the principal is repaid. The Company borrowed a total of $80.0 million under the 2018 Term Loan and obligations were collateralized by substantially all of the Company’s assets.

In connection with entry into the 2018 Term Loan, warrants to purchase an aggregate of 341,578 shares of common stock with an exercise price per share of $21.12 were issued to the lenders. In June 2019, in connection with the borrowing of an additional $20.0 million principal amount, warrants to purchase an aggregate of 128,932 shares of common stock with an exercise price per share of $34.20 were issued to the lenders.

In March 2020, the Company terminated the 2018 Term Loan agreement. The Company used $88.6 million of the proceeds from the Convertible Notes to repay in full all outstanding principle, interest and fees associated with termination of the loan.

For the three and six month periods ended June 30, 2020, the Company incurred interest expense of $4.1 million and $7.0 million, respectively, related to the 2018 Term Loan and the Convertible Notes. For the three and six month period ended June 30, 2019, the Company incurred interest expense of $1.9 million and $3.6 million, respectively, associated with the 2018 Term Loan.

The terminations of the previous debt facilities were accounted for as debt extinguishment and the Company recorded a charge of $6.6 million associated with the elimination of previously deferred financing costs, and for fees and penalties incurred upon termination of the facilities and other costs. These costs have been included as a Loss on extinguishment of debt and termination of revolving loan facility in the Company’s condensed consolidated statements of operations.

2018 Revolving Loan Facility

In January 2018, the Company entered into a $15.0 million secured revolving loan facility, with availability subject to a borrowing base consisting of eligible accounts receivable. In November 2018, the Company entered into an amended and restated loan and security agreement to increase the borrowing capacity under the facility to $20.0 million, amend the borrowing base to include finished goods inventory, and extend the final maturity under the facility to November 2021.

In March 2020, the Company terminated the revolving loan facility and paid termination fees of $0.5 million. There were no amounts outstanding under the revolving loan facility at the time of termination. These costs have been included as a

Loss on extinguishment of debt and termination of revolving loan facility in the Company’s condensed consolidated statements of operations.

Basis of Presentation and Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2020
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements reflect the accounts of the Company and its wholly-owned subsidiaries. The unaudited condensed consolidated balance sheet at December 31, 2019 has been derived from the audited consolidated financial statements at that date but does not include all information and disclosures required by generally accepted accounting principles in the United States of America (“U.S. GAAP”) for annual financial statements. These unaudited condensed consolidated financial statements and notes should be read in conjunction with the Company’s audited consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) and U.S. GAAP for unaudited condensed consolidated financial information. Accordingly, they do not include all information and footnotes required by U.S. GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements reflect all adjustments consisting of normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of the Company’s financial position and results of its operations as of and for the periods presented. Unless indicated otherwise, all amounts presented in financial tables are presented in thousands, except for per share and par value amounts. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Given the global economic climate and additional or unforeseen effects from the COVID-19 pandemic, certain estimates are becoming more challenging, and actual results could differ materially from those estimates. The results of the Company’s operations for the three and six month periods ended June 30, 2020 are not necessarily indicative of the results to be expected for the full year or for any other period.
Revenue Recognition	Revenue Recognition The Company recognizes revenue when control of the promised goods or services is transferred to its customers, in an amount that reflects the consideration expected to be received in exchange for those products and services. This process involves identifying the contract with a customer, determining the performance obligations in the contract, determining the contract price, allocating the contract price to the distinct performance obligations in the contract, and recognizing revenue when the performance obligations have been satisfied. A performance obligation is considered distinct from other obligations in a contract when it provides a benefit to the customer either on its own or together with other resources that are readily available to the customer and is separately identified in the contract. Performance obligations are considered satisfied once the Company has transferred control of a product or service to the customer, meaning the customer has the ability to use and obtain the benefit of the product or service. The Company recognizes revenue for satisfied performance obligations only when there are no uncertainties regarding payment terms or transfer of control. The Company generates the majority of its revenue from the sale of its proprietary nCounter Analysis System and GeoMx DSP System, and related consumables. Services consist of instrument service contracts and service fees for assay processing. The Company at times may enter into collaboration agreements that may generate upfront fees, and in some cases subsequent milestone payments that may be earned upon completion of certain product development milestones or other designated activities. For collaboration agreements of this type, the Company estimates the expected total cost of product development and other services under these arrangements and recognizes collaboration revenue using a contingency-adjusted proportional performance model. The Company may also recognize revenue from collaboration agreements that do not include upfront or milestone-based payments and generally recognizes revenue on these types of agreements based on the timing and amount of development activities. Expenses incurred in relation to research activities conducted in conjunction with our collaboration partners are recognized when the related activities have occurred and are classified in the statement of operations, generally as research and development expense.
Convertible Senior Notes	Convertible Senior Notes In accordance with accounting guidance for debt with conversion and other options, the Company separately accounted for the liability and equity components of the 2.625% Convertible Senior Notes due 2025 (“Convertible Notes”) by allocating the proceeds between the liability component and the embedded conversion feature, or the equity component, due to the Company’s ability to settle the Convertible Notes in cash, common stock or a combination of cash and common stock, at its option. The Company’s current intent is to settle the principal amount of the Convertible Notes in cash upon conversion, with any remaining conversion value being delivered in shares of its common stock. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. The allocation was performed in a manner that reflected the Company’s non-convertible debt borrowing rate for similar debt. The equity component of the Convertible Notes was recognized as a debt discount and represents the difference between the proceeds from the issuance of the Convertible Notes and the fair value of the liability of the Convertible Notes on their respective dates of issuance. The excess of the principal amount of the liability component over its carrying amount is the debt discount and is amortized to interest expense using the effective interest method over five years. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. In connection with the issuance of the Convertible Notes, the Company also incurred certain financing costs associated directly with the issuance of the Convertible Notes. These issuance costs will be deferred, and a portion of the deferred issuance costs have been deemed attributable to the equity component and have been allocated to additional paid-in capital. The remaining deferred issuance costs will also be amortized to interest expense over five years using the effective interest method.
Leases	Leases The Company determines if an arrangement is a lease at inception of a contract. The Company’s leasing portfolio is comprised of operating leases primarily for general office, manufacturing, and research and development purposes. Operating lease liabilities and the corresponding right-of-use assets are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The operating lease right-of-use asset is reduced by lease incentives included in the agreement. As the existing leases do not contain an implicit interest rate, the Company estimates its incremental borrowing rate based on information available at commencement date in determining the present value of future payments. The Company includes options to extend the lease in the lease liability and right-of-use asset when it is reasonably certain that the option will be exercised. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. For our short-term leases, we recognize lease payments as an expense on a straight-line basis over the lease term.
Recent Accounting Pronouncements	Recently Adopted Accounting Pronouncements In June 2016, the FASB issued “ASU 2016-13, Financial Instruments: Credit Losses.” The standard requires disclosure regarding expected credit losses on financial instruments at each reporting date, and changes how other than temporary impairments on investment securities are recorded. The Company adopted the ASU on January 1, 2020 using the modified retrospective transition approach and the adoption did not have a material impact on its condensed consolidated results of operations, financial condition, cash flows and financial statement disclosures for the three or six month periods ended June 30, 2020. In August 2018, the FASB issued “ASU 2018-15, Intangibles — Goodwill and other — Internal-use software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” The standard aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The Company adopted the standard, on a prospective basis, on January 1, 2020. Historically, the Company has had a practice of expensing the implementation costs related to cloud computing arrangements. Upon adoption of the standard, the Company may capitalize certain implementation costs for new cloud computing arrangements in other assets, and amortize the costs over the related service contract period for the hosted arrangement. The amortization of the implementation costs and the related service contract costs will be presented in its results of operations. The adoption did not have a material impact to the condensed consolidated results of operations, financial condition, cash flows, and financial statement disclosures for the three or six month periods ended June 30, 2020. In November 2018, the FASB issued “ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606.” The new guidance clarifies when certain transactions between collaborative arrangement participants which should be accounted for as revenue under Topic 606. The Company adopted the standard on January 1, 2020. The Company has assessed its collaborative arrangements and concluded no adjustment is necessary, based on guidance in the standard. In December 2019, the FASB issued “ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” The new guidance simplifies the accounting for income taxes, eliminates certain exceptions within ASC 740, Income Taxes, and clarifies certain aspects of the current guidance to promote consistency among reporting entities. ASU 2019-12 is effective for fiscal years beginning after December 15, 2021, with early adoption permitted. Most amendments within the standard are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. The Company adopted this ASU effective January 1, 2020 and, as a result, was able to determine the effect of income or loss from continuing operations using a computation that does not consider the tax effects of items that are not included in continuing operations. As such, for the three and six month periods ended June 30, 2020, the Company did not record a tax expense or benefit in its net loss from operations related to deferred tax assets and liabilities associated with its Convertible Notes. See to Note 9. Long-term Debt, Net for additional information. Recent Accounting Pronouncements
Net Loss Per Share	Net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding. Outstanding stock options, restricted stock units, and warrants have not been included in the calculation of diluted net loss per share because to do so would be anti-dilutive. Accordingly, the numerator and the denominator used in computing both basic and diluted net loss per share for each period are the same.
Fair Value Measurements	The Company establishes the fair value of its assets and liabilities using the price that would be received to sell an asset or paid to transfer a financial liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy is used to measure fair value. The three levels of the fair value hierarchy are as follows: •Level 1 — Quoted prices in active markets for identical assets and liabilities. •Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. •Level 3 — Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. The recorded amounts of certain financial instruments, including cash, accounts receivable, prepaid expenses and other, accounts payable and accrued liabilities, approximate fair value due to their relatively short-term maturities.

Revenue from Contracts with Customers (Tables)

6 Months Ended

Jun. 30, 2020

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following table provides information about disaggregated revenue by major product line and primary geographic market (in thousands):


	Three Months Ended June 30, 2020														Six Months Ended June 30, 2020
	Americas		Europe and Middle East		Asia Pacific		Total		Americas		Europe and Middle East		Asia Pacific		Total
Product revenue:
Instruments	$	6,577	$	2,475	$	748	$	9,800	$	13,658	$	4,263	$	1,713	$	19,634
Consumables	5,375		2,406		588		8,369		13,747		4,909		1,213		19,869
Total product revenue	11,952		4,881		1,336		18,169		27,405		9,172		2,926		39,503
Service revenue	1,922		878		175		2,975		3,960		1,752		425		6,137
Total product and service revenue	13,874		5,759		1,511		21,144		31,365		10,924		3,351		45,640
Collaboration revenue	1,460		—		—		1,460		3,569		—		—		3,569
Total revenues	$	15,334	$	5,759	$	1,511	$	22,604	$	34,934	$	10,924	$	3,351	$	49,209


	Three Months Ended June 30, 2019														Six Months Ended June 30, 2019
	Americas		Europe and Middle East		Asia Pacific		Total		Americas		Europe and Middle East		Asia Pacific		Total
Product revenue:
Instruments	$	3,596	$	960	$	384	$	4,940	$	5,786	$	2,490	$	982	$	9,258
Consumables	8,840		4,666		882		14,388		17,444		9,723		1,681		28,848
Total product revenue	12,436		5,626		1,266		19,328		23,230		12,213		2,663		38,106
Service revenue	2,167		682		193		3,042		3,962		1,295		357		5,614
Total product and service revenue	14,603		6,308		1,459		22,370		27,192		13,508		3,020		43,720
Collaboration revenue	7,975		—		—		7,975		14,313		—		—		14,313
Total revenues	$	22,578	$	6,308	$	1,459	$	30,345	$	41,505	$	13,508	$	3,020	$	58,033

Net Loss Per Share (Tables)

6 Months Ended

Jun. 30, 2020

Earnings Per Share [Abstract]

Summary of Shares Underlying Outstanding Options and Warrants were Excluded from Computation of Basic and Diluted Net Loss Per Share


	Three Months Ended June 30,			Six Months Ended June 30, 2020
	2020	2019	2020	2019
Options to purchase common stock	3,501	4,765	3,724	4,801
Restricted stock units	1,578	1,641	1,515	1,578
Common stock warrants	479	1,013	538	960
Stock appreciation rights	13	—	7	—

Short-term Investments (Tables)

6 Months Ended

Jun. 30, 2020

Investments, Debt and Equity Securities [Abstract]

Short-Term Investments Available-for-Sale Securities

Short-term investments consisted of available-for-sale and equity securities as follows (in thousands):


Type of securities as of June 30, 2020	Amortized cost		Gross unrealized gains		Gross unrealized losses		Fair value
Corporate debt securities	$	50,859	$	291	$	—	$	51,150
U.S. government-related debt securities	20,009		118		—		20,127
Asset-backed securities	8,960		29		—		8,989
Total available-for-sale debt securities	$	79,828	$	438	$	—	$	80,266


Type of securities as of December 31, 2019	Amortized cost		Gross unrealized gains		Gross unrealized losses		Fair value
Corporate debt securities	$	78,243	$	89	$	(2)	$	78,330
U.S. government-related debt securities	26,966		37		—		27,003
Asset-backed securities	11,950		21		—		11,971
Total available-for-sale debt securities	$	117,159	$	147	$	(2)	$	117,304
Corporate equity securities	9,893		625		—		10,518
Total short-term investment securities	$	127,052	$	772	$	(2)	$	127,822

Fair Values of Available-for-Sale Securities by Contractual Maturity

The fair values of available-for-sale debt securities by contractual maturity were as follows (in thousands):


	June 30, 2020		December 31, 2019
Maturing in one year or less	$	80,266	$	101,751
Maturing in one to three years	—		15,553
Total available-for-sale debt securities	$	80,266	$	117,304

Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Company's Available-for-Sale Securities by Level within Fair Value Hierarchy

The Company’s investments by level within the fair value hierarchy were as follows (in thousands):


As of June 30, 2020	Level 1		Level 2		Level 3		Total
Cash equivalents:
Money market fund	$	160,982	$	—	$	—	$	160,982
Short-term investments:
Corporate debt securities	—		51,150		—		51,150
U.S. government-related debt securities	—		20,127		—		20,127
Asset-backed securities	—		8,989		—		8,989

Total	$	160,982	$	80,266	$	—	$	241,248