0001299130-22-000136 | 10-Q | XBRL Viewer | Pacific Biosciences OF California INC

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Convertible Senior Notes (Schedule of Interest Expense) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Convertible Senior Notes [Abstract]
Contractual interest expense	$ 3,375	$ 3,375	$ 10,125	$ 8,438
Amortization of debt issuance costs	154	152	462	379
Total interest expense	$ 3,529	$ 3,527	$ 10,587	$ 8,817

Stockholders' Equity (Narrative) (Details) $ in Millions					1 Months Ended	3 Months Ended	9 Months Ended
Stockholders' Equity (Narrative) (Details) $ in Millions	May 25, 2022 shares	Nov. 22, 2021 shares	Sep. 20, 2021 item shares	Apr. 18, 2021 shares	Feb. 28, 2022 shares	Sep. 30, 2022 USD ($) shares	Sep. 30, 2022 USD ($) shares	Sep. 30, 2021 shares	Dec. 02, 2020 shares	Aug. 04, 2020 shares
Stockholders' Equity [Line Items]
Dividend yield							0.00%
Omniome Plan [Member]
Stockholders' Equity [Line Items]
Exchange ratio \| item			0.259204639
Shares authorized			2,494,128
ESPP [Member]
Stockholders' Equity [Line Items]
Shares issued							1,878,168	1,913,968
Additional common stock reserved for issuance					4,000,000.0
Common stock remain available for issuance						9,932,505	9,932,505
Stock-based compensation expense \| $						$ 2.3	$ 7.9
2020 Equity Incentive Plan [Member]
Stockholders' Equity [Line Items]
Shares authorized										11,000,000
Additional common stock reserved for issuance	18,000,000
Common stock remain available for issuance						18,700,000	18,700,000
2020 Inducement Equity Incentive Plan [Member]
Stockholders' Equity [Line Items]
Shares authorized									2,500,000
Additional common stock reserved for issuance		360,000		750,000
Time-based and performance-based options [Member]
Stockholders' Equity [Line Items]
Stock-based compensation expense \| $						$ 6.4	$ 20.9
RSUs with performance-based vesting [Member]
Stockholders' Equity [Line Items]
Stock-based compensation expense \| $						$ 10.3	$ 31.9

Stockholders' Equity (Schedule of Fair Value of Employee Stock Options) (Details) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Dividend yield			0.00%
Options to purchase common stock [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Expected term in years	4 years 7 months 6 days		4 years 7 months 6 days
Expected volatility	75.00%
Risk-free interest rate	3.66%
Risk-free interest rate, minimum		0.05%	0.41%	0.05%
Risk-free interest rate, maximum		0.71%	3.66%	0.74%
Weighted average grant date fair value per share	$ 4.94	$ 5.97	$ 5.93	$ 15.63
Options to purchase common stock [Member] \| Minimum [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Expected term in years		2 years 1 month 6 days		2 years 1 month 6 days
Expected volatility		67.00%	70.00%	67.00%
Options to purchase common stock [Member] \| Maximum [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Expected term in years		4 years 7 months 6 days		4 years 7 months 6 days
Expected volatility		80.00%		80.00%

Convertible Senior Notes (Schedule of Net Carrying Amount) (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Convertible Senior Notes [Abstract]
Principal amount	$ 900,000	$ 900,000
Unamortized debt issuance costs	(3,471)	(3,933)
Net carrying amount	$ 896,529	$ 896,067

- Definition

Amount, excluding unamortized premium (discount) and debt issuance cost, of long-term debt. Excludes lease obligation.

+ References + Details

Stockholders' Equity (Summary of Time-Based RSUs Activity) (Details) - RSUs with time-based vesting [Member] shares in Thousands	9 Months Ended
	Sep. 30, 2022 $ / shares shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of shares, Outstanding, Beginning \| shares	7,392
Number of shares, Granted \| shares	5,054
Number of shares, Vested \| shares	(2,395)
Number of shares, Forfeited \| shares	(1,381)
Number of shares, Outstanding, Ending \| shares	8,670
Weighted average grant date fair value Outstanding, Beginning \| $ / shares	$ 19.78
Weighted average grant date fair value, Granted \| $ / shares	10.24
Weighted average grant date fair value, Vested \| $ / shares	14.58
Weighted average grant date fair value, Forfeited \| $ / shares	19.86
Weighted average grant date fair value, Outstanding Ending \| $ / shares	$ 15.64

Invitae Collaboration (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Development and Commercialization of Significant Agreements Transactions [Line Items]
Term of Amended and Restated Agreement			Amended and Restated Agreement shall continue until June 30, 2028
Revenue	$ 32,311	$ 34,887	$ 100,951	$ 94,494
Deferred revenue, non-current	1,762		1,762		$ 25,049
Deferred revenue, current	30,689		30,689		10,977
Product [Member]
Development and Commercialization of Significant Agreements Transactions [Line Items]
Revenue	27,509	$ 30,502	85,928	$ 82,338
Invitae Corporation [Member] \| Development Agreement [Member]
Development and Commercialization of Significant Agreements Transactions [Line Items]
Deferred revenue, non-current	23,500		23,500
Invitae Corporation [Member] \| Amended and Restated Agreement [Member]
Development and Commercialization of Significant Agreements Transactions [Line Items]
Deferred revenue, non-current					$ 23,500
Deferred revenue, current	21,400		21,400
Invitae Corporation [Member] \| Product [Member]
Development and Commercialization of Significant Agreements Transactions [Line Items]
Revenue	$ 0		$ 3,700

- Definition

Amount, including tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value-added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 606
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-Section 50
-Paragraph 5
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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-Topic 280
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-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9054-108599

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-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599

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-Name Accounting Standards Codification
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+ Details

Balance Sheet Components (Future Principal Payments) (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Long-term Debt, Fiscal Year Maturity [Abstract]
Long-term Debt	$ 896,529	$ 896,067
Omniome, Inc [Member]
Long-term Debt, Fiscal Year Maturity [Abstract]
Remainder of 2022	428
2023	1,842
2024	490
Long-term Debt	$ 2,760

- Definition

Amount, excluding unamortized premium (discount) and debt issuance cost, of long-term debt. Excludes lease obligation.

+ References + Details

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands	Sep. 30, 2022	Dec. 31, 2021
Condensed Consolidated Balance Sheets [Abstract]
Preferred Stock, par value	$ 0.001	$ 0.001
Preferred Stock, shares authorized	50,000	50,000
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0
Common Stock, par value	$ 0.001	$ 0.001
Common Stock, shares authorized	1,000,000	1,000,000
Common Stock, shares issued	225,916	220,978
Common Stock, shares outstanding	225,916	220,978

Balance Sheet Components (Tables)

9 Months Ended

Sep. 30, 2022

Balance Sheet Components [Abstract]

Components of Inventory



	September 30,		December 31,
	2022		2021
Purchased materials	$	19,973	$	7,993
Work in process		13,458		8,611
Finished goods		10,064		7,995
Inventory	$	43,495	$	24,599

Schedule of definite-lived intangible assets from business acquisitions



		As of September 30, 2022						As of December 31, 2021
	Estimated	Gross				Net		Gross				Net
	Useful Life	Carrying		Accumulated		Carrying		Carrying		Accumulated		Carrying
	(in years)	Amount		Amortization		Amount		Amount		Amortization		Amount
Developed technology	15	$	11,000	$	(856)	$	10,144	$	11,000	$	(306)	$	10,694
Customer relationships	2		360		(210)		150		360		(75)		285
Total		$	11,360	$	(1,066)	$	10,294	$	11,360	$	(381)	$	10,979

Estimated Future Amortization Expense Of Acquisition-Related Intangible Assets With Definite Lives



Remainder of 2022	$	228
2023		838
2024		733
2025		733
2026		733
2027 and thereafter		7,029
Total	$	10,294

Changes in Reserve for Product Warranties



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Balance at beginning of period	$	1,609	$	271	$	594	$	161
Additions charged to cost of product revenue		779		945		2,644		1,560
Repairs and replacements		(622)		(683)		(1,472)		(1,188)
Balance at end of period	$	1,766	$	533	$	1,766	$	533

Future Principal Payments , Fiscal Year Maturity



Remainder of 2022	$	428
2023		1,842
2024		490
Total	$	2,760

Balance Sheet Components (Estimated Future Amortization Expense Of Acquisition-Related Intangible Assets With Definite Lives) (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Balance Sheet Components [Abstract]
Remainder of 2022	$ 228
2023	838
2024	733
2025	733
2026	733
2027 and thereafter	7,029
Total	$ 10,294	$ 10,979

Financial Instruments (Changes in estimated fair value of contingent consideration) (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2022
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Beginning balance		$ 169,717
Change in estimated fair value	$ 4,280	(2,221)
Ending balance	167,496	167,496
Level 3 [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Beginning balance		169,717
Change in estimated fair value		(2,221)
Ending balance	$ 167,496	$ 167,496

Net Loss Per Share

9 Months Ended

Sep. 30, 2022

Net Loss Per Share [Abstract]

Net Loss Per Share

NOTE 10. NET LOSS PER SHARE

Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed using the weighted-average number of shares of common stock outstanding and potential shares assuming the dilutive effect of the convertible senior notes, using the if-converted method, and outstanding stock options, restricted stock units and common stock issuable pursuant to our employee stock purchase plan, or ESPP, using the treasury stock method.

The following table presents the calculation of the basic and diluted net (loss) income per share amounts presented in the Condensed Consolidated Statements of Operations and Comprehensive Loss (in thousands, except per share amounts):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Numerator:
Net (loss) income	$	(76,971)	$	16,542	$	(229,864)	$	(111,894)

Denominator:
Basic
Weighted average shares used in computing basic net (loss) income		225,123		202,194		223,981		198,545
Basic net (loss) income per share	$	(0.34)	$	0.08	$	(1.03)	$	(0.56)

Diluted
Weighted average shares used in computing basic net (loss) income per share		225,123		202,194		223,981		198,545
Add: weighted average stock options		—		7,754		—		—
Add: weighted average restricted stock units		—		3,598		—		—
Add: weighted average common stock issuable pursuant to our ESPP		—		1,581		—		—
Weighted average shares used in computing diluted net loss per share		225,123		215,127		223,981		198,545
Diluted net (loss) income per share	$	(0.34)	$	0.08	$	(1.03)	$	(0.56)

The following outstanding shares issuable upon conversion of the convertible senior notes, common stock options, restricted stock units (“RSUs”), with time-based vesting and performance-based vesting and ESPP shares expected to be purchased, were excluded from the computation of diluted net (loss) income per share for the three and nine months ended September 30, 2022 and 2021 as the effect would be anti-dilutive or to reduce the net loss per share (in thousands).



	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2022	2021	2022	2021
Shares issuable upon conversion of convertible senior notes	20,690	20,690	20,690	20,690
Options to purchase common stock	15,537	2,326	15,537	12,703
RSUs	8,670	2,006	8,670	6,835
ESPP shares	3,880	126	3,880	1,564

As described in Note 2. Business Acquisitions in Part I, Item 1 of this Quarterly Report on Form 10-Q, the contingently issuable shares would be due upon the achievement of a milestone. See Note 9. Stockholders’ Equity in Part I, Item 1 of this Quarterly Report on Form 10-Q for detailed information on RSUs with time-based vesting and RSUs with performance-based vesting.

Organization and Significant Accounting Policies	9 Months Ended
Organization and Significant Accounting Policies	Sep. 30, 2022
Organization and Significant Accounting Policies[Abstract]
Organization and Significant Accounting Policies	NOTE 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES We are a life science technology company that designs, develops, and manufactures advanced sequencing solutions to help scientists and clinical researchers resolve genetically complex problems. Our products and technology under development stem from two highly differentiated core technologies focused on accuracy, quality and completeness which include our existing HiFi long-read sequencing technology and our emerging short-read Sequencing by Binding (SBB^®) technology. Our products address solutions across a broad set of applications including human germline sequencing, plant and animal sciences, infectious disease and microbiology, oncology, and other emerging applications. Our focus is on providing our customers with advanced sequencing technologies with higher throughput and improved workflows that we believe will enable dramatic advancements in routine healthcare. Our customers include academic and governmental research institutions, commercial testing and service laboratories, genome centers, public health labs, hospitals and clinical research institutes, contract research organizations (CROs), pharmaceutical companies and agricultural companies. References in this report to “PacBio,” “we,” “us,” the “Company,” and “our” refer to Pacific Biosciences of California, Inc. and its consolidated subsidiaries. Basis of Presentation and Consolidation Our unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States, or U.S. GAAP, as set forth in the Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or ASC. The unaudited condensed consolidated financial statements include the accounts of Pacific Biosciences and our wholly owned subsidiaries. Certain information and footnote disclosures typically included in our audited financial statements have been condensed or omitted. The accompanying unaudited condensed consolidated financial statements have been prepared on a consistent basis with the December 31, 2021 audited consolidated financial statements and include all adjustments, consisting of only normal recurring adjustments, necessary to fairly state our financial position, results of operations, comprehensive (loss) income, and cash flows for the period, but are not necessarily indicative of the results to be expected for the entire year or any future periods. All intercompany transactions and balances have been eliminated. The financial statements should be read in conjunction with the audited consolidated financial statements and notes included in our Annual Report on Form 10-K for the year ended December 31, 2021. Use of Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes to the financial statements. On an ongoing basis, we evaluate our significant estimates including, but not limited to, the valuation of inventory, the determination of stand-alone selling prices for revenue recognition, the fair value of contingent consideration, the valuation of acquired intangible assets, the fair value of certain equity awards, the useful lives assigned to long-lived assets, the computation of provisions for income taxes, the borrowing rate used in calculating the operating lease right-of-use assets and operating lease liabilities, the probability associated with variable payments under partnership development agreements, and the valuations related to our convertible senior notes. While the extent of the potential impact of the current macroeconomic conditions and ongoing COVID-19 pandemic on our business is highly uncertain, we considered information available related to assumptions and estimates used to determine the results reported and asset valuations as of September 30, 2022. Actual results could differ materially from these estimates. Cash, Cash Equivalents, and Investments We consider all highly liquid investments purchased with an original maturity of 90 days or less to be cash equivalents. Cash equivalents may be comprised of money market funds, certificates of deposit, commercial paper, corporate bonds and notes, and government agencies’ securities. We classify our investments in debt securities as available-for sale and report the investments at fair value in current assets. We evaluate our available-for-sale investments in unrealized loss positions and assess whether the unrealized loss is credit-related. Unrealized gains and losses that are not credit-related are recognized in accumulated other comprehensive (loss) income in stockholders’ equity. Realized gains and losses, expected credit losses, as well as interest income, on available-for-sale securities are also reported in other income (expense), net. The cost used in the determination of gains and losses of securities sold is based on the specific identification method. The cost of marketable securities is adjusted for the amortization of premiums and discounts to expected maturity. Premium and discount amortization is recorded in other income (expense), net. Our investment portfolio at any point in time contains investments in cash deposits, money market funds, commercial paper, corporate debt securities and U.S. government and agency securities with high credit ratings. We have established guidelines regarding diversification and maturities of investments with the objectives of maintaining safety and liquidity, while maximizing yield. Concentration and Other Risks For the three and nine months ended September 30, 2022, one customer accounted for approximately 13% and 11% of total revenue during the period. For the three and nine months ended September 30, 2021, one customer accounted for approximately 17% and 15% of total revenue during the period. No other customers exceeded 10% during those periods. As of September 30, 2022, 54% of our accounts receivable were from domestic customers, compared to 53% as of December 31, 2021. As of September 30, 2022, one customer represented 10% of our accounts receivable, while no customer represented 10% or greater of our net accounts receivable as of December 31, 2021. Recent Accounting Pronouncements There are no accounting standards updates (“ASUs”) that have been recently adopted. Significant Accounting Policies There have been no changes to our significant accounting policies as disclosed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2021; however, as a result of certain changes to the standard contractual terms and conditions with customers implemented during the quarter ended March 31, 2022, we concluded that a change in the application of our accounting policy, in accordance with ASC 606, was appropriate. Specifically, we modified the standard contractual terms with customers during the first quarter of 2022, to reflect transfer of title and risk of loss and right to invoice upon delivery. We also updated the terms of the warranty provided with the instrument to remove the service component. As a result, the warranty is no longer a separate performance obligation and, accordingly, we accrue for the cost of the assurance warranty when revenue of the instrument is recognized. In addition, because of technical enhancements associated with our more recent instrument releases, including the Sequel IIe systems, installation services are now distinct from the instrument itself. Therefore, instrument revenue is now recognized upon transfer of control of the asset to the customer, which is generally upon delivery for sales made to our non-distributor customers.

Stockholders' Equity

9 Months Ended

Sep. 30, 2022

Stockholders' Equity [Abstract]

Stockholders' Equity

NOTE 9. STOCKHOLDERS’ EQUITY

Equity Plans

The 2020 Equity Incentive Plan (the “2020 Plan”), the 2020 Inducement Equity Incentive Plan (the “Inducement Plan”) and the 2021 adopted Omniome Equity Incentive Plan of Pacific Biosciences of California, Inc. (the “Omniome Plan”) allow for the issuance of stock options, restricted units and awards and performance-based awards.

On August 4, 2020, stockholders approved the 2020 Plan and reserved 11,000,000 shares of our common stock for issuance pursuant to equity awards granted under the 2020 Plan.

On December 2, 2020, the Board of Directors (the “Board”) adopted the Inducement Plan and reserved 2,500,000 shares of our common stock for issuance pursuant to equity awards granted under the Inducement Plan. On April 18, 2021 and November 22, 2021, the Board amended the Inducement Plan to reserve an additional 750,000 and 360,000 shares, respectively.

On September 20, 2021, in connection with the acquisition of Omniome, we adopted the Omniome Equity Incentive Plan of Pacific Biosciences of California, Inc. (the “Omniome Plan”). Under the Omniome Merger Agreement, each unvested option to purchase Omniome common stock, granted under the Omniome Plan held by employees continuing with us, were assumed by PacBio and converted into an option to purchase shares of our common stock. The terms and conditions of the converted options are substantially the same (including vesting and exercisability), except that (A) the assumed options cover shares of PacBio’s common stock; (B) the number of shares of our common stock subject to the assumed option is equal to the product of (i) the number of shares of Omniome common stock subject to the corresponding unvested option, multiplied by (ii) the exchange ratio (as defined below), with any resulting fractional share rounded down to the nearest whole share; and (C) the exercise price per share of the assumed options is equal to the quotient of (i) the exercise price per share of the corresponding unvested option to purchase shares of Omniome common stock, divided by (ii) the exchange ratio (as defined below), with any resulting fractional cent rounded up to the nearest whole cent. The exchange ratio was equal to 0.259204639. We reserved 2,494,128 shares of our common stock for issuance pursuant to equity awards under the Omniome Plan.

On May 25, 2022, stockholders approved an amendment to the 2020 Plan and we reserved an additional 18,000,000 shares of our common stock for issuance pursuant to equity awards granted under the 2020 Plan.

As of September 30, 2022, we had 18.7 million shares remaining and available for future issuance under the 2020 Plan, Inducement Plan, and the Omniome Plan.

Stock Options

Time-based Stock Options

The following table summarizes stock option activity for time-based awards for the nine months ended September 30, 2022 (shares in thousands):



				Weighted
	Number			average
	of shares	Exercise price		exercise price
Outstanding at December 31, 2021	12,159	$	1.16 – 46.37	$	11.38
Granted	5,211		4.61 – 16.58		10.34
Exercised	(650)		1.16 – 8.90		3.33
Canceled	(1,485)		2.47 – 46.37		20.96
Outstanding at September 30, 2022	15,235	$	1.16 – 46.37	$	10.43

‎

Performance-based Stock Options

The following table summarizes stock option activity for performance-based awards for the nine months ended September 30, 2022 (shares in thousands):



				Weighted
	Number			average
	of shares	Exercise price		exercise price
Outstanding at December 31, 2021	304	$	4.71 – 4.90	$	4.71
Granted	—		—		—
Exercised	—		—		—
Canceled	(2)		4.71 – 4.90		4.75
Outstanding at September 30, 2022	302	$	4.71 – 4.90	$	4.71

For the three and nine months ended September 30, 2022, we recognized stock-based compensation expense of $6.4 million and $20.9 million, respectively, related to time-based and performance-based options.

Restricted Stock Units (“RSUs”)

The following table summarizes the time-based RSU activity for the nine months ended September 30, 2022 (shares in thousands):



		Weighted average
	Number	grant date
	of shares	fair value
Outstanding at December 31, 2021	7,392	$	19.78
Granted	5,054		10.24
Vested	(2,395)		14.58
Forfeited	(1,381)		19.86
Outstanding at September 30, 2022	8,670	$	15.64

For the three and nine months ended September 30, 2022, we recognized stock-based compensation expense of $10.3 million and $31.9 million, respectively, related to restricted stock units.

Employee Stock Purchase Plan (“ESPP”)

Shares issued under our ESPP were 1,878,168 and 1,913,968 during the nine months ended September 30, 2022 and 2021, respectively. In February 2022, an additional 4.0 million shares were reserved under the ESPP. As of September 30, 2022, 9,932,505 shares of our common stock remain available for issuance under our ESPP.

For the three and nine months ended September 30, 2022, we recognized stock-based compensation expense of $2.3 million and $7.9 million, respectively, related to our ESPP.

Stock-Based Compensation

The following table summarizes stock-based compensation expense (in thousands):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Cost of revenue	$	934	$	1,837	$	3,680	$	4,734
Research and development		7,519		5,162		24,232		12,519
Sales, general and administrative		10,483		9,897		32,746		25,613
Merger-related expenses - stock-settled		—		6,349		—		6,349
Merger-related expenses - milestone		—		5,202		—		5,202
Stock-based compensation		18,936		28,447		60,658		54,417
Merger-related expenses - cash-settled		—		7,373		—		7,373
Total stock-based compensation expense	$	18,936	$	35,820	$	60,658	$	61,790

Determining Fair Value

We estimate the fair value of stock options granted using the Black-Scholes valuation method and a single option award approach. When determining the current share prices underlying the stock options for calculating the grant-date fair value, we reference the observable market prices of our stock. This fair value is then amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. The fair market value of RSUs granted is the closing price of our shares on the date of grant and is generally recognized as compensation expense on a straight-line basis over the respective vesting period. For shares purchased under our ESPP, we estimate the grant-date fair value, and the resulting stock-based compensation expense, using the Black-Scholes option-pricing model. We estimate forfeitures of stock options, RSUs and shares purchased under our ESPP which is utilized to determine the compensation expense to be recorded over the requisite service period.

Expected Term - The expected term used in the Black-Scholes valuation method represents the period that the stock options are expected to be outstanding and is determined based on historical experience of similar awards, giving consideration to the contractual terms of the stock options and vesting schedules.

Expected Volatility - The expected volatility used in the Black-Scholes valuation method is derived from the implied volatility related to our share price over the expected term.

Expected Dividend - We have never paid dividends on our shares and, accordingly, the dividend yield percentage is zero for all periods.

Risk-Free Interest Rate - The risk-free interest rate used in the Black-Scholes valuation method is the implied yield currently available on U.S. Treasury constant maturities issued with a term equivalent to the expected terms.

For the three and nine months ended September 30, 2022 and 2021, the fair value of employee stock options was estimated using the following assumptions:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Expected term in years		4.6		2.1 — 4.6		4.6		2.1 — 4.6
Expected volatility		75%		67% — 80%		70% - 76%		67% — 80%
Risk-free interest rate		3.66%		0.05% — 0.71%		0.41% - 3.66%		0.05% — 0.74%
Dividend yield		—		—		—		—
Weighted average grant date fair value per share	$	4.94	$	5.97	$	5.93	$	15.63

For the three and nine months ended September 30, 2022 and 2021, the fair value of shares to be issued under the ESPP was estimated using the following assumptions:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Expected term in years		0.5 — 2.0		0.5 — 2.0		0.5 — 2.0		0.5 — 2.0
Expected volatility		97%		67%		70% — 97%		67% — 68%
Risk-free interest rate		3.34% — 3.51%		0.06% — 0.20%		0.60% — 3.51%		0.06% — 0.20%
Dividend yield		—		—		—		—
Weighted average grant date fair value per share	$	3.40	$	16.73	$	4.28	$	25.07

Business Acquisitions (Narrative) (Details) - USD ($) $ in Thousands			3 Months Ended	9 Months Ended	12 Months Ended
	Sep. 20, 2021	Jul. 20, 2021	Sep. 30, 2021	Sep. 30, 2021	Dec. 31, 2021	Sep. 30, 2022
Business Acquisition [Line Items]
Fair value of contingent consideration					$ 169,717	$ 167,496
Issuance of common stock in Private Placement, net of issuance costs			$ 294,845	$ 294,845
Acquisition-related costs			30,726	30,726
Goodwill					409,974	409,974
Finite-Lived Intangible Assets, Gross					11,360	11,360
Income Tax Expense (Benefit)			(94,824)	(94,824)
Circulomics, Inc [Member]
Business Acquisition [Line Items]
Total cash paid		$ 29,500
Goodwill		19,309
Finite-Lived Intangible Assets, Gross		$ 11,400
Omniome, Inc [Member]
Business Acquisition [Line Items]
Total cash paid	$ 315,703
Fair value of share consideration	249,435
Fair value of contingent consideration	168,574
Contingent Consideration Incurred during period	$ 168,600
Issuance of common stock	8,911,580
Consideration	$ 714,789
Acquisition-related costs	11,600		11,600	11,600
Stock-based compensation expense	18,900
Income tax benefit from reduction in deferred tax assets valuation allowance	92,200
Pro forma adjustment related to acquiree's acquisition-related costs	16,700
Since the date of acquisition, revenues			$ 0	0
Since the date of acquisition, net loss				$ 1,600
Goodwill	390,665
Omniome, Inc [Member] \| Effect of Change Higher/(Lower) [Member]
Business Acquisition [Line Items]
Goodwill					(1,600)
Deferred Tax Liabilities, Deferred Expense					(400)
Income Tax Expense (Benefit)					(1,200)
Omniome, Inc [Member] \| Omniome stock awards related to acquisition [Member]
Business Acquisition [Line Items]
Total cash paid	7,400
Fair value of share consideration	6,300
Contingent Consideration Incurred during period	$ 5,200
Issuance of common stock	226,811
Consideration	$ 18,900
Achievement of milestone [Member] \| Omniome, Inc [Member]
Business Acquisition [Line Items]
Total cash paid	100,000
Fair value of share consideration	100,000
Fair value of contingent consideration	200,000
Stock options issued by PacBio in replacement of Omniome’s unvested options	$ 4,100
Percentage of outstanding shares of common to be issued in merger	19.90%
Issuance of common stock in Private Placement, net of issuance costs shares	11,500,000
Developed Technology [Member]
Business Acquisition [Line Items]
Finite-Lived Intangible Assets, Gross					$ 11,000	$ 11,000

Financial Instruments (Narrative) (Details) - USD ($) $ in Thousands		1 Months Ended	3 Months Ended	9 Months Ended
	Feb. 09, 2021	Feb. 28, 2021	Sep. 30, 2022	Sep. 30, 2022
Financial Instruments [Line Items]
Change in estimated fair value of the liability			$ (4,280)	$ 2,221
Level 3 [Member]
Financial Instruments [Line Items]
Change in estimated fair value of the liability				$ 2,221
Convertible Senior Notes [Member]
Financial Instruments [Line Items]
Debt Instrument Face Amount	$ 900,000	$ 900,000
Debt Instrument Interest Rate Stated Percentage	1.50%	1.50%
Debt Instrument, Maturity Date	Feb. 15, 2028	Feb. 15, 2028
Measurement Input, Discount Rate [Member] \| Contingent consideration liability [Member] \| Maximum [Member] \| B Credit Rating [Member]
Financial Instruments [Line Items]
Debt Instrument Interest Rate Stated Percentage			10.90%	10.90%
Measurement Input, Discount Rate [Member] \| Contingent consideration liability [Member] \| Minimum [Member] \| B- Credit Rating [Member]
Financial Instruments [Line Items]
Debt Instrument Interest Rate Stated Percentage			10.50%	10.50%

Stockholders' Equity (Schedule of Stock-Based Compensation Expense) (Details) - ESPP [Member] - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 18,936	$ 35,820	$ 60,658	$ 61,790
Cost of revenue [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	934	1,837	3,680	4,734
Research and development [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	7,519	5,162	24,232	12,519
Sales, general and administrative [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	10,483	9,897	32,746	25,613
Merger-related expenses - stock-settled [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense		6,349		6,349
Merger-related expenses - milestone [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense		5,202		5,202
Stock-based compensation [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 18,936	28,447	$ 60,658	54,417
Merger-related expenses - cash-settled [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense		$ 7,373		$ 7,373

Net Loss Per Share (Computation Of Basic And Diluted Net ((Loss) Income Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Numerator
Net (loss) income	$ (76,971)	$ 16,542	$ (229,864)	$ (111,894)
Basic
Weighted average shares used in computing basic net loss	225,123	202,194	223,981	198,545
Basic net (loss) income per share	$ (0.34)	$ 0.08	$ (1.03)	$ (0.56)
Diluted
Weighted average shares used in computing basic net loss per share	225,123	202,194	223,981	198,545
Weighted average shares used in computing diluted net loss per share	225,123	215,127	223,981	198,545
Diluted net (loss) income per share	$ (0.34)	$ 0.08	$ (1.03)	$ (0.56)
Options to purchase common stock [Member]
Diluted
Add: weighted average		7,754
RSUs [Member]
Diluted
Add: weighted average		3,598
ESPP [Member]
Diluted
Add: weighted average		1,581

Net Loss Per Share (Antidilutive Shares Excluded From Computation Of Diluted Net Loss Per Share) (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Shares issuable upon conversion of convertible senior notes [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive securities excluded from the computation of earnings per share	20,690	20,690	20,690	20,690
Warrants to purchase common stock [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive securities excluded from the computation of earnings per share	15,537	2,326	15,537	12,703
RSUs [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive securities excluded from the computation of earnings per share	8,670	2,006	8,670	6,835
ESPP [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive securities excluded from the computation of earnings per share	3,880	126	3,880	1,564

Balance Sheet Components (Narrative) (Details) - USD ($)	1 Months Ended	3 Months Ended	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2022	Dec. 31, 2021	Oct. 31, 2015
Balance Sheet Components [Line Items]
Percentage of fee to prepay debt			4.00%
Short-term restricted cash		$ 300,000	$ 300,000	$ 500,000
Long-term restricted cash		2,922,000	2,922,000	4,592,000
May 1 annual decrease to long-term restricted cash			500,000
Goodwill impairment		0
Deferred revenue, current		30,689,000	30,689,000	10,977,000
Deferred revenue, non-current		1,762,000	1,762,000	25,049,000
Revenue recognized			$ 11,500,000
Deferred service revenue, noncurrent, recognition period			5 years
Prepaid expenses and other current assets		13,005,000	$ 13,005,000	7,394,000
Standard Product Warranty Description			a one-year warranty on instruments
Omniome, Inc [Member]
Balance Sheet Components [Line Items]
Long-term restricted cash	$ 1,600,000	0	$ 0	1,600,000
Short term debt acquired	1,300,000
Long-term debt acquired	$ 3,000,000.0
Debt Instrument, Term	43 months
Debt Instrument Interest Rate Stated Percentage	17.00%
Omniome, Inc [Member] \| In Process Research and Development [Member]
Balance Sheet Components [Line Items]
Indefinite-lived Intangible Assets (Excluding Goodwill)	$ 400,000,000
Security Deposit [Member]
Balance Sheet Components [Line Items]
Short-term restricted cash		300,000	300,000	500,000
O’Brien Lease Agreement [Member]
Balance Sheet Components [Line Items]
Long-term restricted cash		2,500,000	2,500,000	$ 3,000,000.0	$ 4,500,000
Additional long-term restricted cash			400,000
Service [Member]
Balance Sheet Components [Line Items]
Deferred revenue		32,500,000	32,500,000
Deferred revenue, current		30,700,000	30,700,000
Prepaid expenses and other current assets		600,000	600,000
Service contract [Member]
Balance Sheet Components [Line Items]
Deferred revenue, non-current		$ 1,800,000	$ 1,800,000

Commitments and Contingencies (Narrative) (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021
Commitments and Contingencies [Abstract]
Additional liability associated with indemnification obligations	$ 0	$ 0

Convertible Senior Notes (Narrative) (Details) - Convertible Senior Notes [Member] - USD ($)			1 Months Ended
	Feb. 16, 2021	Feb. 09, 2021	Feb. 28, 2021	Sep. 30, 2022
Debt Instrument [Line Items]
Principal amount of notes		$ 900,000,000	$ 900,000,000
Debt instrument, stated interest rate		1.50%	1.50%
Maturity date		Feb. 15, 2028	Feb. 15, 2028
Issuance date	Feb. 16, 2021
Shares issued conversion rate per $1,000 principal amount	22.9885
Principal amount for conversion rate	$ 1,000
Conversion price per share	$ 43.50
Debt redemption, percentage of conversion price	150.00%
Debt redemption, trading days	20 days
Debt redemption, consecutive trading days	30 days
Redemption price, percentage	100.00%
Debt issuance costs				$ 4,500,000
Debt instrument, effective interest rate				1.60%
Fair value of convertible debt				$ 554,400,000
Each Day During the First 180 Days [Member]
Debt Instrument [Line Items]
Additional interest in the event of default	0.25%
181st Day to 360th Day [Member]
Debt Instrument [Line Items]
Additional interest in the event of default	0.50%

Revenue (Tables)

9 Months Ended

Sep. 30, 2022

Revenue [Abstract]

Schedule of Revenue by Geographic Location



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Americas	$	16,743	$	19,368	$	57,547	$	45,872
Europe, Middle East and Africa		5,997		6,347		17,432		21,166
Asia-Pacific		9,571		9,172		25,972		27,456
Total	$	32,311	$	34,887	$	100,951	$	94,494

Summary of Revenue by Category



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Instrument revenue	$	11,442	$	15,926	$	42,611	$	45,147
Consumable revenue		16,067		14,576		43,317		37,191
Product revenue		27,509		30,502		85,928		82,338
Service and other revenue		4,802		4,385		15,023		12,156
Total revenue	$	32,311	$	34,887	$	100,951	$	94,494

Termination of Merger with Illumina (Narrative) (Details) - USD ($) $ in Thousands		1 Months Ended	3 Months Ended	9 Months Ended
	Feb. 09, 2021	Feb. 28, 2021	Mar. 31, 2020	Sep. 30, 2021
Merger Termination [Line Items]
(Loss) Gain from Continuation Advances		$ (52,000)		$ (52,000)
Equity or debt financing that must be raised in a single transaction			$ 100,000
Illumina, FC Ops Corp [Member]
Merger Termination [Line Items]
(Loss) Gain from Continuation Advances			$ 52,000
Convertible Senior Notes [Member]
Merger Termination [Line Items]
Principal amount of notes	$ 900,000	$ 900,000
Debt instrument, stated interest rate	1.50%	1.50%
Maturity date	Feb. 15, 2028	Feb. 15, 2028

Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2022

Financial Instruments [Abstract]

Summary of Assets and Liabilities Measured at Fair Value on a Recurring Basis



	September 30, 2022								December 31, 2021
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Cash and cash equivalents	$	63,154	$	241,279	$	—	$	304,433	$	327,315	$	133,410	$	—	$	460,725
Investments:
Commercial paper		—		57,408		—		57,408		—		187,632		—		187,632
Corporate debt securities		—		49,478		—		49,478		—		8,968		—		8,968
U.S. government & agency securities		—		423,021		—		423,021		—		387,075		—		387,075
Total investments		—		529,907		—		529,907		—		583,675		—		583,675

Short-term restricted cash		300		—		—		300		500		—		—		500
Long-term restricted cash		2,922		—		—		2,922		4,592		—		—		4,592
Total assets measured at fair value	$	66,376	$	771,186	$	—	$	837,562	$	332,407	$	717,085	$	—	$	1,049,492

Liabilities
Contingent consideration	$	—	$	—	$	167,496	$	167,496	$	—	$	—	$	169,717	$	169,717
Total liabilities measured at fair value	$	—	$	—	$	167,496	$	167,496	$	—	$	—	$	169,717	$	169,717

Changes in the estimated fair value of contingent consideration liabilities



		Level 3
Beginning balance as of December 31, 2021	$	169,717
Change in estimated fair value		(2,221)
Ending balance as of September 30, 2022	$	167,496

Summary of Cash, Cash Equivalents and Investments



	As of September 30, 2022
			Gross		Gross
	Amortized		unrealized		unrealized		Fair
	Cost		gains		losses		Value

Cash and cash equivalents		304,480		—		(47)		304,433
Investments:
Commercial paper		57,713		—		(305)		57,408
Corporate debt securities		50,098		2		(622)		49,478
U.S. government & agency securities		428,309		—		(5,288)		423,021
Total investments		536,120		2		(6,215)		529,907
Total cash, cash equivalents and investments	$	840,600	$	2	$	(6,262)	$	834,340

Short-term restricted cash	$	300	$	—	$	—	$	300
Long-term restricted cash	$	2,922	$	—	$	—	$	2,922

	As of December 31, 2021
			Gross		Gross
	Amortized		unrealized		unrealized		Fair
	Cost		gains		losses		Value

Cash and cash equivalents		460,731		—		(5)		460,725
Investments:
Commercial paper		187,705		—		(73)		187,632
Corporate debt securities		8,964		9		(5)		8,968
U.S. government & agency securities		388,088		1		(1,014)		387,075
Total investments		584,757		10		(1,092)		583,675
Total cash, cash equivalents and investments	$	1,045,488	$	10	$	(1,097)	$	1,044,400

Short-term restricted cash	$	500	$	—	$	—	$	500
Long-term restricted cash	$	4,592	$	—	$	—	$	4,592

Summary of Contractual Maturities of Cash Equivalents and Available-for-Sale Investments



	Fair Value
Due in one year or less	$	670,316
Due after one year through five years		100,870
Total investments	$	771,186

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References + Details

Balance Sheet Components

9 Months Ended

Sep. 30, 2022

Balance Sheet Components [Abstract]

Balance Sheet Components

NOTE 6. BALANCE SHEET COMPONENTS

Short-term Restricted Cash

As of September 30, 2022 and December 31, 2021, the short-term restricted cash balance was $0.3 million and $0.5 million, respectively, which was comprised of security deposits for the credit cards of employees.

‎

Inventory, net

As of September 30, 2022 and December 31, 2021, our inventory, net, consisted of the following components (in thousands):



	September 30,		December 31,
	2022		2021
Purchased materials	$	19,973	$	7,993
Work in process		13,458		8,611
Finished goods		10,064		7,995
Inventory	$	43,495	$	24,599

Long-term Restricted Cash

For our facility located at 1305 O’Brien Drive, Menlo Park, California (the “O’Brien Lease”), we were required to establish a letter of credit for the benefit of the landlord and to submit $4.5 million as a deposit for the letter of credit in October 2015. Subsequently, pursuant to the terms of the O’Brien Lease, beginning on May 1, 2019, the amount of the letter of credit was reduced by $0.5 million each year thereafter on May 1. As such, $2.5 million and $3.0 million was recorded in long-term restricted cash related to the O’Brien Lease in the Condensed Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021, respectively. In connection with the acquisition of Omniome in September 2021, we acquired $1.6 million of long-term restricted cash related to a letter of credit established for a facility lease. Long-term restricted cash related to this facility was $0 and $1.6 million in the Condensed Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021, respectively. At September 30, 2022, we had an additional $0.4 million in long-term restricted cash primarily related to a letter of credit established for a facility lease.

Intangible Assets and Goodwill

Intangible assets include acquired in-process research and development (IPR&D) of $400 million as a result of the Omniome acquisition in September 2021. The IPR&D will remain on our consolidated balance sheet as an indefinite-lived intangible asset until the completion or abandonment of the associated research and development activities. During the development period following the acquisition, IPR&D will not be amortized, but instead will be tested for impairment annually and more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. Upon completion of the development, we will begin to amortize the asset over the life of the product, or record an impairment charge if the asset is determined to be impaired.

In addition to IPR&D, definite-lived intangible assets from business acquisitions included the following (in thousands, except years):



		As of September 30, 2022						As of December 31, 2021
	Estimated	Gross				Net		Gross				Net
	Useful Life	Carrying		Accumulated		Carrying		Carrying		Accumulated		Carrying
	(in years)	Amount		Amortization		Amount		Amount		Amortization		Amount
Developed technology	15	$	11,000	$	(856)	$	10,144	$	11,000	$	(306)	$	10,694
Customer relationships	2		360		(210)		150		360		(75)		285
Total		$	11,360	$	(1,066)	$	10,294	$	11,360	$	(381)	$	10,979

The estimated future amortization expense of acquisition-related intangible assets with definite lives is estimated as follows (in thousands):



Remainder of 2022	$	228
2023		838
2024		733
2025		733
2026		733
2027 and thereafter		7,029
Total	$	10,294

We review definite-lived intangible assets for impairment when indication of potential impairment exists, such as a significant reduction in cash flows associated with the assets.

Goodwill is reviewed for impairment at least annually during the second quarter, or more frequently if an event occurs indicating the potential for impairment. We performed our annual assessment for goodwill impairment in the second quarter of 2022, noting no impairment.

Deferred Revenue

As of September 30, 2022, we had a total of $32.5 million of deferred revenue, $30.7 million of which was recorded as deferred revenue, current, and primarily relates to future performance obligations under the Amended and Restated Agreement with Invitae as described in Note 3. Invitae Collaboration in Part I, Item 1 of this Quarterly Report on Form 10-Q. The deferred revenue, non-current balance of $1.8 million primarily relates to deferred service contract revenues and is scheduled to be recognized in the next 5 years. Revenue recorded in the nine months ended September 30, 2022 includes $11.5 million of previously deferred revenue that was included in deferred revenue as of December 31, 2021. Contract assets as of September 30, 2022 and December 31, 2021 were not material.

As of September 30, 2022, we had a total of $0.6 million of deferred commissions included in prepaid expenses and other current assets which is recognized as sales, general and administrative expense as the related revenue is recognized. Costs to obtain a contract are expensed as incurred if the amortization period would have been a year or less.

Product Warranties

We generally provide a one-year warranty on instruments. In addition, we provide a limited warranty on consumables. At the time revenue is recognized, an accrual is established for estimated warranty costs based on historical experience as well as anticipated product performance. We periodically review the warranty reserve for adequacy and adjust the warranty accrual, if necessary, based on actual experience and estimated costs to be incurred. Warranty expense is recorded as a component of cost of product revenue. There were no material changes in estimates for the periods presented below.

Changes in the reserve for product warranties were as follows for the periods indicated (in thousands):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Balance at beginning of period	$	1,609	$	271	$	594	$	161
Additions charged to cost of product revenue		779		945		2,644		1,560
Repairs and replacements		(622)		(683)		(1,472)		(1,188)
Balance at end of period	$	1,766	$	533	$	1,766	$	533

Term loans

In connection with the acquisition of Omniome, we acquired $1.3 million in short-term debt and $3.0 million in long-term debt relating to a term loan facility that Omniome obtained in April 2020. Borrowings on the term loan facility were used to fund Omniome’s purchases of equipment, which serves as collateral. Each term loan has a term of 43 months and bears a fixed interest rate of approximately 17% annually. The fee for the elective option to prepay all, but not less than all, of the borrowed amounts at any time after the 24^th month and before the 43^rd month after the commencement date, is 4% of the outstanding loan balance. Payments are made in equal monthly installments including principal and interest.

The following table presents the future principal payments on the term loans (in thousands):



Remainder of 2022	$	428
2023		1,842
2024		490
Total	$	2,760

Financial Instruments (Summary of Cash, Cash Equivalents and Investments) (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Schedule of Available-for-sale Securities [Line Items]
Total investments in debt securities	$ 771,186
Cash, cash equivalents and investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	840,600	$ 1,045,488
Gross unrealized gains	2	10
Gross unrealized losses	(6,262)	(1,097)
Total investments in debt securities	834,340	1,044,400
Cash and cash equivalents [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	304,480	460,731
Gross unrealized losses	(47)	(5)
Total investments in debt securities	304,433	460,725
Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	536,120	584,757
Gross unrealized gains	2	10
Gross unrealized losses	(6,215)	(1,092)
Total investments in debt securities	529,907	583,675
Commercial paper, not included with cash and cash equivalents [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	57,713	187,705
Gross unrealized losses	(305)	(73)
Total investments in debt securities	57,408	187,632
Corporate debt securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	50,098	8,964
Gross unrealized gains	2	9
Gross unrealized losses	(622)	(5)
Total investments in debt securities	49,478	8,968
U.S. government & agency securities, not included with cash and cash equivalents [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	428,309	388,088
Gross unrealized gains		1
Gross unrealized losses	(5,288)	(1,014)
Total investments in debt securities	423,021	387,075
Long-term restricted cash [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	2,922	4,592
Total investments in debt securities	2,922	4,592
Short-Term Restricted Cash [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	300	500
Total investments in debt securities	$ 300	$ 500

Net Loss Per Share (Tables)

9 Months Ended

Sep. 30, 2022

Net Loss Per Share [Abstract]

Computation of Basic and Diluted Net Loss per Share



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Numerator:
Net (loss) income	$	(76,971)	$	16,542	$	(229,864)	$	(111,894)

Denominator:
Basic
Weighted average shares used in computing basic net (loss) income		225,123		202,194		223,981		198,545
Basic net (loss) income per share	$	(0.34)	$	0.08	$	(1.03)	$	(0.56)

Diluted
Weighted average shares used in computing basic net (loss) income per share		225,123		202,194		223,981		198,545
Add: weighted average stock options		—		7,754		—		—
Add: weighted average restricted stock units		—		3,598		—		—
Add: weighted average common stock issuable pursuant to our ESPP		—		1,581		—		—
Weighted average shares used in computing diluted net loss per share		225,123		215,127		223,981		198,545
Diluted net (loss) income per share	$	(0.34)	$	0.08	$	(1.03)	$	(0.56)

Antidilutive Shares Excluded from Computation of Diluted Net Loss per Share



	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2022	2021	2022	2021
Shares issuable upon conversion of convertible senior notes	20,690	20,690	20,690	20,690
Options to purchase common stock	15,537	2,326	15,537	12,703
RSUs	8,670	2,006	8,670	6,835
ESPP shares	3,880	126	3,880	1,564

Organization and Significant Accounting Policies (Narrative) (Details) $ in Thousands		1 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended	21 Months Ended
	Feb. 09, 2021 USD ($)	Feb. 28, 2021 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2021	Sep. 30, 2022 USD ($) customer	Sep. 30, 2021	Dec. 31, 2021 USD ($) customer	Sep. 30, 2022 USD ($) customer
Summary Of Significant Accounting Policies [Line Items]
Contingent repayment liability \| $			$ 167,496		$ 167,496		$ 169,717	$ 167,496
Single customer with 10% or greater [Member]
Summary Of Significant Accounting Policies [Line Items]
Number of customers							0
Customers with 10% or greater accounts receivable [Member]
Summary Of Significant Accounting Policies [Line Items]
Number of customers					1
Sales Revenue, Net [Member] \| Single customer with 10% or greater [Member] \| Customer Concentration Risk [Member]
Summary Of Significant Accounting Policies [Line Items]
Number of customers								0
Sales Revenue, Net [Member] \| One Customer [Member] \| Customer Concentration Risk [Member]
Summary Of Significant Accounting Policies [Line Items]
Concentration risk, percentage			13.00%	17.00%	11.00%	15.00%
Accounts Receivable [Member] \| Domestic Customers [Member] \| Customer Concentration Risk [Member]
Summary Of Significant Accounting Policies [Line Items]
Concentration risk, percentage					54.00%		53.00%
Accounts Receivable [Member] \| One Customer [Member] \| Customer Concentration Risk [Member]
Summary Of Significant Accounting Policies [Line Items]
Concentration risk, percentage					10.00%
Convertible Senior Notes [Member]
Summary Of Significant Accounting Policies [Line Items]
Principal amount of notes \| $	$ 900,000	$ 900,000
Maturity date	Feb. 15, 2028	Feb. 15, 2028

Revenue (Summary of Revenue by Category) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Product Information [Line Items]
Total revenue	$ 32,311	$ 34,887	$ 100,951	$ 94,494
Product [Member]
Product Information [Line Items]
Total revenue	27,509	30,502	85,928	82,338
Instrument [Member]
Product Information [Line Items]
Total revenue	11,442	15,926	42,611	45,147
Consumable [Member]
Product Information [Line Items]
Total revenue	16,067	14,576	43,317	37,191
Service and Other [Member]
Product Information [Line Items]
Total revenue	$ 4,802	$ 4,385	$ 15,023	$ 12,156

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Section 50
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

Stockholders' Equity (Tables)

9 Months Ended

Sep. 30, 2022

Summary of Time-Based RSUs Activity



		Weighted average
	Number	grant date
	of shares	fair value
Outstanding at December 31, 2021	7,392	$	19.78
Granted	5,054		10.24
Vested	(2,395)		14.58
Forfeited	(1,381)		19.86
Outstanding at September 30, 2022	8,670	$	15.64

Schedule of Stock-Based Compensation Expense



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Cost of revenue	$	934	$	1,837	$	3,680	$	4,734
Research and development		7,519		5,162		24,232		12,519
Sales, general and administrative		10,483		9,897		32,746		25,613
Merger-related expenses - stock-settled		—		6,349		—		6,349
Merger-related expenses - milestone		—		5,202		—		5,202
Stock-based compensation		18,936		28,447		60,658		54,417
Merger-related expenses - cash-settled		—		7,373		—		7,373
Total stock-based compensation expense	$	18,936	$	35,820	$	60,658	$	61,790

Schedule of Fair Value of Employee Stock Options



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Expected term in years		4.6		2.1 — 4.6		4.6		2.1 — 4.6
Expected volatility		75%		67% — 80%		70% - 76%		67% — 80%
Risk-free interest rate		3.66%		0.05% — 0.71%		0.41% - 3.66%		0.05% — 0.74%
Dividend yield		—		—		—		—
Weighted average grant date fair value per share	$	4.94	$	5.97	$	5.93	$	15.63

Schedule of Fair Value of Employee Stock Purchase Plan



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Expected term in years		0.5 — 2.0		0.5 — 2.0		0.5 — 2.0		0.5 — 2.0
Expected volatility		97%		67%		70% — 97%		67% — 68%
Risk-free interest rate		3.34% — 3.51%		0.06% — 0.20%		0.60% — 3.51%		0.06% — 0.20%
Dividend yield		—		—		—		—
Weighted average grant date fair value per share	$	3.40	$	16.73	$	4.28	$	25.07

Time-based stock options [Member]

Summary of Stock Option Activity



				Weighted
	Number			average
	of shares	Exercise price		exercise price
Outstanding at December 31, 2021	12,159	$	1.16 – 46.37	$	11.38
Granted	5,211		4.61 – 16.58		10.34
Exercised	(650)		1.16 – 8.90		3.33
Canceled	(1,485)		2.47 – 46.37		20.96
Outstanding at September 30, 2022	15,235	$	1.16 – 46.37	$	10.43

Performance-based stock options [Member]

Summary of Stock Option Activity



				Weighted
	Number			average
	of shares	Exercise price		exercise price
Outstanding at December 31, 2021	304	$	4.71 – 4.90	$	4.71
Granted	—		—		—
Exercised	—		—		—
Canceled	(2)		4.71 – 4.90		4.75
Outstanding at September 30, 2022	302	$	4.71 – 4.90	$	4.71

Business Acquisition (Tables)

9 Months Ended

Sep. 30, 2022

Omniome, Inc [Member]

Business Acquisition [Line Items]

Total Consideration Transferred For Acquisition



Total cash paid	$	315,703
Fair value of share consideration		249,435
Fair value of contingent consideration		168,574
Less: Stock-based compensation expense excluded from consideration transferred		(18,923)
Total consideration transferred	$	714,789

Major Classes Of Assets And Liabilities Allocated To Total Fair Value Of The Consideration Transferred



Cash and cash equivalents	$	15,338
Property and equipment, net		6,123
Operating lease right-of-use assets, net		18,095
In-process research and development ("IPR&D")		400,000
Goodwill		390,665
Other assets		3,203
Deferred income tax liability		(91,814)
Liabilities assumed		(26,821)
Total consideration transferred	$	714,789

Unaudited Pro Forma Financial Information



	Three Months Ended		Nine Months Ended
	September 30, 2021		September 30, 2021
Pro forma total revenue	$	34,887	$	94,494
Pro forma net loss	$	(54,802)	$	(213,715)

Circulomics, Inc [Member]

Business Acquisition [Line Items]

Total Consideration Transferred For Acquisition



Cash and cash equivalents	$	987
Property and equipment, net		214
Intangible assets		11,360
Goodwill		19,309
Other assets		467
Deferred income tax liability		(2,672)
Liabilities assumed		(118)
Total consideration transferred	$	29,547

Stockholders' Equity (Schedule of Fair Value of Employee Stock Purchase Plan) (Details) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Dividend yield			0.00%
ESPP [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Expected volatility	97.00%	67.00%
Risk-free interest rate, minimum	3.34%	0.06%		0.06%
Risk-free interest rate, maximum	3.51%	0.20%		0.20%
Weighted average grant date fair value, Granted	$ 3.40	$ 16.73	$ 4.28	$ 25.07
ESPP [Member] \| Minimum [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Expected term in years	6 months	6 months	6 months	6 months
Expected volatility			70.00%	67.00%
ESPP [Member] \| Maximum [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Expected term in years	2 years	2 years	2 years	2 years
Expected volatility			97.00%	68.00%

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Current assets
Cash and cash equivalents	$ 304,433	$ 460,725
Investments	529,907	583,675
Accounts receivable, net	22,756	24,241
Inventory, net	43,495	24,599
Prepaid expenses and other current assets	13,005	7,394
Short-term restricted cash	300	500
Total current assets	913,896	1,101,134
Property and equipment, net	39,154	32,504
Operating lease right-of-use assets, net	41,533	46,617
Long-term restricted cash	2,922	4,592
Intangible assets, net	410,294	410,979
Goodwill	409,974	409,974
Other long-term assets	1,176	1,170
Total assets	1,818,949	2,006,970
Current liabilities
Accounts payable	12,853	11,002
Accrued expenses	24,886	36,261
Deferred revenue, current	30,689	10,977
Operating lease liabilities, current	8,612	7,710
Other liabilities, current	4,609	5,759
Total current liabilities	81,649	71,709
Deferred revenue, non-current	1,762	25,049
Contingent consideration liability, non-current	167,496	169,717
Operating lease liabilities, non-current	43,163	49,970
Convertible senior notes, net, non-current	896,529	896,067
Other liabilities, non-current	1,759	3,471
Total liabilities	1,192,358	1,215,983
Commitments and contingencies
Stockholders' equity
Preferred stock, $0.001 par value: Authorized 50,000 shares; No shares issued or outstanding
Common stock, $0.001 par value: Authorized 1,000,000 shares; issued and outstanding 225,916 and 220,978 shares at September 30, 2022 and December 31, 2021, respectively	226	221
Additional paid-in capital	2,080,581	2,009,945
Accumulated other comprehensive loss	(6,260)	(1,087)
Accumulated deficit	(1,447,956)	(1,218,092)
Total stockholders' equity	626,591	790,987
Total liabilities and stockholders' equity	$ 1,818,949	$ 2,006,970

Commitments and Contingencies

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies [Abstract]

Commitments and Contingencies

NOTE 8. COMMITMENTS AND CONTINGENCIES

The Company has entered into various operating lease agreements, primarily relating to our corporate offices. See Note 8 – Commitments and Contingencies, subsection titled “Leases”, in Part II, Item 8 of the Annual Report on Form 10-K for the year ended December 31, 2021 for information regarding the Company’s maturity of lease liabilities under its lease agreements.

Contingencies

We may become involved in legal proceedings, claims and assessments from time to time in the ordinary course of business. We accrue liabilities for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated.

Legal

U.S. District Court Proceedings

On September 26, 2019, Personal Genomics of Taiwan, Inc. (“PGI”) filed a complaint in the U.S. District Court for the District of Delaware against us for patent infringement (C.A. No. 19-cv-1810) (the “PGI District Court matter”). The matter from this complaint is based on PGI’s U.S. Patent No. 7,767,441 (the “‘441 Patent”). We plan to vigorously defend in this matter. On November 20, 2019, we filed our answer to the complaint, denying infringement and seeking a declaratory judgement of invalidity of the ‘441 Patent.

On June 22, 2020, we filed a petition requesting institution of an inter-partes review (IPR) to the Patent Trial and Appeals Board (the “Board”) at the United States Patent Office requesting the Board to find a set of claims in the ‘441 Patent invalid. On June 27, 2020, we filed a second petition requesting institution of an IPR requesting the Board to find another set of claims in the ‘441 Patent invalid. The two petitions (the “PacBio IPR Petitions”) requesting IPRs assert that all of the claims relevant to the PGI complaint are invalid. On January 19, 2021, the Board ordered that both PacBio IPR Petitions are instituted on all grounds presented. On January 18, 2022, the Board issued decisions on the two IPRs. In one IPR, all challenged claims were found unpatentable including PGI’s core device claims. In the second IPR, the

board did not find the disputed claims unpatentable. We are appealing the decision in the second IPR to the U.S. Court of Appeals for the Federal Circuit.

On August 19, 2020, the court ordered a stay of the PGI District Court matter based on a joint stipulation by the parties pending a final written decision on the IPRs. Following the final decision on the IPRs described above, on February 2, 2022, the judge ordered that the PGI District Court matter be reopened. However, in a subsequent order dated September 15, 2022, the judge stayed the PGI District Court matter pending a final decision in the Federal Circuit appeal of the IPRs.

Proceedings in China

On May 12, 2020, PGI filed a complaint in the Wuhan Intermediate People’s Court in China alleging infringement of one or more claims of China patent No. CN101743321B (the “CN321 Patent”), which is related to the ‘441 Patent. On November 23, 2020, we filed an Invalidation Petition at the China National Intellectual Property Administration (CNIPA) demonstrating the invalidity of the claims in the CN321 Patent on grounds of insufficient disclosure, and the lack of support, essential technical features, clarity, novelty, and inventiveness. A hearing in the invalidation proceeding at the CNIPA was held on April 29, 2021. On September 2, 2021, the CNIPA issued its decision on the Invalidation Petition and determined that all claims (1-61) of the CN321 patent were invalid. On December 1, 2021, PGI filed an appeal with the Beijing IP Court, contesting the CNIPA decision. We filed a petition with the Wuhan Intermediate People’s court requesting dismissal of the infringement action based on the CNIPA invalidation decision, and PGI filed a petition to withdraw its complaint. The Wuhan Intermediate People’s court granted PGI’s petition and dismissed the infringement action in May 2022.

Other Proceedings

From time to time, we may also be involved in a variety of other claims, lawsuits, investigations and proceedings relating to securities laws, product liability, patent infringement, contract disputes, employment and other matters that arise in the normal course of our business. In addition, third parties may, from time to time, assert claims against us in the form of letters and other communications.

We record a provision for contingent losses when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We currently do not believe that the ultimate outcome of any of the matters described above is probable or reasonably estimable, or that these matters will have a material adverse effect on our business; however, the results of litigation and claims are inherently unpredictable. Regardless of the outcome, litigation can have an adverse impact on us because of litigation and settlement costs, diversion of management resources and other factors.

Indemnification

Pursuant to Delaware law and agreements entered into with each of our directors and officers, we may have obligations, under certain circumstances, to hold harmless and indemnify each of our directors and officers against losses suffered or incurred by the indemnified party in connection with their service to us, and judgements, fines, settlements and expenses related to claims arising against such directors and officers to the fullest extent permitted under Delaware law, our bylaws and our certificate of incorporation. We also enter and have entered into indemnification agreements with our directors and officers that may require us to indemnify them against liabilities that arise by reason of their status or service as directors or officers, except as prohibited by applicable law. In addition, we may have obligations to hold harmless and indemnify third parties involved with our fundraising efforts and their respective affiliates, directors, officers, employees, agents or other representatives against any and all losses, claims, damages and liabilities related to claims arising against such parties pursuant to the terms of agreements entered into between such third parties and us in connection with such fundraising efforts. To the extent that any such indemnification obligations apply to the lawsuits described above, any associated expenses incurred are included within the related accrued litigation expense amounts. No additional liability associated with such indemnification obligations has been recorded as of September 30, 2022 and December 31, 2021.

- Definition

The entire disclosure for loss and gain contingencies. Describes any existing condition, situation, or set of circumstances involving uncertainty as of the balance sheet date (or prior to issuance of the financial statements) as to a probable or reasonably possible loss incurred by an entity that will ultimately be resolved when one or more future events occur or fail to occur, and typically discloses the amount of loss recorded or a range of possible loss, or an assertion that no reasonable estimate can be made.

+ References + Details

Convertible Senior Notes (Tables)

9 Months Ended

Sep. 30, 2022

Convertible Senior Notes [Abstract]

Schedule of Net Carrying Amount



	September 30,		December 31,
	2022		2021
Principal amount	$	900,000	$	900,000
Unamortized debt issuance costs		(3,471)		(3,933)
Net carrying amount	$	896,529	$	896,067

Schedule of Interest Expense



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Contractual interest expense	$	3,375	$	3,375	$	10,125	$	8,438
Amortization of debt issuance costs		154		152		462		379
Total interest expense	$	3,529	$	3,527	$	10,587	$	8,817

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
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-Name Accounting Standards Codification
-Topic 235
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-Section S99
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+ Details

Revenue (Schedule of Revenue by Geographic Location) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	$ 32,311	$ 34,887	$ 100,951	$ 94,494
Americas [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	16,743	19,368	57,547	45,872
Europe, Middle East and Africa [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	5,997	6,347	17,432	21,166
Asia-Pacific [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	$ 9,571	$ 9,172	$ 25,972	$ 27,456

- Definition

+ References

+ Details

Business Acquisitions (Schedule by Acquisitions) (Details) - USD ($) $ in Thousands			3 Months Ended	9 Months Ended
	Sep. 20, 2021	Jul. 20, 2021	Sep. 30, 2021	Sep. 30, 2021	Sep. 30, 2022	Dec. 31, 2021
Business Combination, Consideration Transferred [Abstract]
Fair value of contingent consideration					$ 167,496	$ 169,717
Major classes of assets and liabilities allocated to total fair value of consideration transferred
Goodwill					$ 409,974	$ 409,974
Business Acquisition, Pro Forma Information [Abstract]
Pro forma total revenue			$ 34,887
Pro forma net (loss) income			$ (54,802)
Circulomics, Inc [Member]
Business Combination, Consideration Transferred [Abstract]
Total cash paid		$ 29,500
Major classes of assets and liabilities allocated to total fair value of consideration transferred
Cash and cash equivalents		987
Property and equipment, net		214
Intangible assets, finite lived		11,360
Goodwill		19,309
Other assets		467
Deferred income tax liability		(2,672)
Liabilities assumed		(118)
Total consideration transferred		$ 29,547
Omniome, Inc [Member]
Business Combination, Consideration Transferred [Abstract]
Total cash paid	$ 315,703
Fair value of share consideration	249,435
Fair value of contingent consideration	168,574
Fair value of contingent consideration	168,600
Less: Stock-based compensation expense excluded from consideration transferred	(18,923)
Total consideration transferred	714,789
Major classes of assets and liabilities allocated to total fair value of consideration transferred
Cash and cash equivalents	15,338
Property and equipment, net	6,123
Operating lease right-of-use assets, net	18,095
In-process research and development ("IPR&D")	400,000
Goodwill	390,665
Other assets	3,203
Deferred income tax liability	(91,814)
Liabilities assumed	(26,821)
Total consideration transferred	$ 714,789
Business Acquisition, Pro Forma Information [Abstract]
Pro forma total revenue				$ 94,494
Pro forma net (loss) income				$ (213,715)

Balance Sheet Components (Components of Inventory) (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Balance Sheet Components [Abstract]
Purchased materials	$ 19,973	$ 7,993
Work in process	13,458	8,611
Finished goods	10,064	7,995
Inventory	$ 43,495	$ 24,599

Document And Entity Information - shares	9 Months Ended
Document And Entity Information - shares	Sep. 30, 2022	Oct. 31, 2022
Document And Entity Information [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Current Fiscal Year End Date	--12-31
Document Period End Date	Sep. 30, 2022
Document Fiscal Year Focus	2022
Document Transition Report	false
Entity File Number	001-34899
Entity Registrant Name	Pacific Biosciences of California, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	16-1590339
Entity Address, Address Line One	1305 O’Brien Drive
Entity Address, City or Town	Menlo Park
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94025
City Area Code	650
Local Phone Number	521-8000
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	PACB
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock Shares Outstanding		226,109,275
Amendment Flag	false
Entity Central Index Key	0001299130
Document Fiscal Period Focus	Q3

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Revenue:
Total revenue	$ 32,311	$ 34,887	$ 100,951	$ 94,494
Cost of revenue:
Cost of product revenue	15,568	15,530	45,887	41,449
Cost of service and other revenue	3,012	3,870	10,619	10,828
Amortization of Intangible Assets	184	123	550	123
Total cost of revenue	18,764	19,523	57,056	52,400
Gross profit	13,547	15,364	43,895	42,094
Operating expense:
Research and development	47,092	27,508	150,377	70,323
Sales, general and administrative	36,795	31,606	115,851	86,804
Merger-related expenses		30,726		30,726
Change in fair value of contingent consideration	4,280		(2,221)
Total operating expense	88,167	89,840	264,007	187,853
Operating loss	(74,620)	(74,476)	(220,112)	(145,759)
Loss from Continuation Advances				(52,000)
Interest expense	(3,664)	(3,673)	(11,042)	(9,051)
Other income (expense), net	1,313	(133)	1,290	92
Loss before benefit from income taxes	(76,971)	(78,282)	(229,864)	(206,718)
Benefit from income taxes		(94,824)		(94,824)
Net (loss) income	(76,971)	16,542	(229,864)	(111,894)
Other comprehensive loss:
Unrealized loss on investments	(803)	33	(5,173)	(58)
Comprehensive loss	$ (77,774)	$ 16,575	$ (235,037)	$ (111,952)
Net (loss) income per share:
Diluted	$ (0.34)	$ 0.08	$ (1.03)	$ (0.56)
Basic	$ (0.34)	$ 0.08	$ (1.03)	$ (0.56)
Weighted average shares outstanding used in calculating net loss per share:
Basic	225,123	202,194	223,981	198,545
Diluted	225,123	215,127	223,981	198,545
Product [Member]
Revenue:
Total revenue	$ 27,509	$ 30,502	$ 85,928	$ 82,338
Service and Other [Member]
Revenue:
Total revenue	$ 4,802	$ 4,385	$ 15,023	$ 12,156

Balance Sheet Components (Definite-lived Intangible Assets from Business Acquisitions) (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 11,360	$ 11,360
Accumulated Amortization	(1,066)	(381)
Net Carrying Amount	$ 10,294	10,979
Developed Technology [Member]
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Life (in years)	15 years
Gross Carrying Amount	$ 11,000	11,000
Accumulated Amortization	(856)	(306)
Net Carrying Amount	$ 10,144	10,694
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Life (in years)	2 years
Gross Carrying Amount	$ 360	360
Accumulated Amortization	(210)	(75)
Net Carrying Amount	$ 150	$ 285

Termination of Merger with Illumina

9 Months Ended

Sep. 30, 2022

Termination of Merger with Illumina [Abstract]

Termination of Merger with Illumina

NOTE 4. TERMINATION OF MERGER WITH ILLUMINA

On November 1, 2018, we entered into an Agreement and Plan of Merger (as amended, the “Illumina Merger Agreement”) with Illumina, Inc. (“Illumina”) and FC Ops Corp., a wholly owned subsidiary of Illumina (“Illumina Merger Sub”). On January 2, 2020, we, Illumina and Illumina Merger Sub, entered into an agreement to terminate the Merger Agreement (the “Termination Agreement”).

Continuation Advances from Illumina

As part of the Termination Agreement, Illumina paid us cash payments (“Continuation Advances”) totaling $52.0 million. Up to the full $52.0 million of Continuation Advances paid to us were repayable without interest to Illumina if, within two years of March 31, 2020, we entered into, or consummated a Change of Control Transaction or raised at least $100 million in a single equity or debt financing (that may have multiple closings), with the amount repayable dependent on the amount raised by us.

Resulting from the issuance and sale of $900 million of 1.50% Convertible Senior Notes due February 15, 2028, $52.0 million of Continuation Advances were paid without interest to Illumina in February 2021, and a corresponding non-operating expense was recorded in the Consolidated Statements of Operations and Comprehensive (Loss) Income during the quarter ended March 31, 2021.

Invitae Collaboration	9 Months Ended
Invitae Collaboration	Sep. 30, 2022
Invitae Collaboration [Abstract]
Invitae Collaboration	NOTE 3. INVITAE COLLABORATION On June 24, 2022, we entered into an Amended and Restated Development and Commercialization Agreement (the “Amended and Restated Agreement”) with Invitae Corporation (“Invitae”). The Amended and Restated Agreement amended and restated the existing Development and Commercialization Agreement, effective as of January 12, 2021, as amended by Amendment No. 1 to Development and Commercialization Agreement, entered into on June 3, 2021, by and between us and Invitae (together, the “Original Agreement”). Unless otherwise agreed in writing or terminated in accordance with the Amended and Restated Agreement, the term of the Amended and Restated Agreement shall continue until June 30, 2028 (“Term”). Pursuant to the Original Agreement, Invitae provided certain funding to us to develop products relating to production-scale high-throughput sequencing (“Program Products”). If Program Products were to become commercially available, Invitae had the right to purchase the Program Products at preferred pricing. Under the Amended and Restated Agreement, we will continue to receive feedback, input and insight from Invitae in connection with the intended development of our new sequencing systems; however, such feedback will not be contractually required, and Invitae has no contractual right to participate in decisions regarding the development program for such new sequencing systems. Our development plans for such new sequencing systems will be at our discretion and pursuant to our own internal processes and programs. Invitae will not be contractually obligated to reimburse us for development costs under the Amended and Restated Agreement. There can be no assurances that the in-development sequencing systems will continue to be developed, be successfully developed or become available for commercial sale. In consideration of the non-refundable payments received from Invitae pursuant to the Original Agreement of $23.5 million, we will provide Invitae with credits in connection with Invitae’s anticipated purchase of certain currently available and in-development sequencing systems (instruments and consumables). The credits will expire on June 30, 2025 (“Credit Expiration Date”). Subject to certain conditions, Invitae will also be entitled to most favored pricing for the Company’s Sequel IIe systems and certain in-development systems through the Term. We and Invitae may terminate the Amended and Restated Agreement if the other party remains in material breach of the Amended and Restated Agreement following a cure period to remedy the material breach. The Amended and Restated Agreement is deemed a contract modification and accounted for on a prospective basis in accordance with ASC Topic 606. We will recognize proportionate amounts of the transaction price, including payments made by Invitae to us pursuant to the Original Agreement, in revenue as the remaining performance obligations are satisfied, which is when Invitae places purchase orders for certain currently available and in-development sequencing platforms and the associated goods are delivered. Any remaining unused credits will be recognized when they expire. During the three and nine months ended September 30, 2022, Invitae purchased certain currently available instruments, for which $0 and $3.7 million, respectively, of revenue was recognized as Product Revenue on the Condensed Consolidated Statements of Operations and Comprehensive Loss under the terms of the Amended and Restated Agreement. As of December 31, 2021, we have recognized payments received from Invitae of $23.5 million in deferred revenue, non-current, on the Consolidated Balance Sheet. As of September 30, 2022, $21.4 million of deferred revenue, current, is recorded on the Condensed Consolidated Balance Sheet relating to all future performance obligations under the Amended and Restated Agreement.

Stockholders' Equity (Summary of Stock Option Activity) (Details) - $ / shares shares in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Time-based stock option [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Number of shares, Outstanding, Beginning	12,159
Number of shares, Granted	5,211
Number of shares, Exercised	(650)
Number of shares, Canceled	(1,485)
Number of shares, Outstanding, Ending	15,235	12,159
Weighted average exercise price, Outstanding, Beginning	$ 11.38
Weighted average exercise price, Granted	10.34
Weighted average exercise price, Exercised	3.33
Weighted average exercise price, Canceled	20.96
Weighted average exercise price, Outstanding, Ending	$ 10.43	$ 11.38
Performance-based stock options [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Number of shares, Outstanding, Beginning	304
Number of shares, Canceled	(2)
Number of shares, Outstanding, Ending	302	304
Weighted average exercise price, Outstanding, Beginning	$ 4.71
Weighted average exercise price, Canceled	4.75
Weighted average exercise price, Outstanding, Ending	4.71	$ 4.71
$1.16 – 46.37 [Member] \| Time-based stock option [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Exercise price, lower range		1.16
Exercise price, upper range		46.37
$4.61 – 16.58 [Member] \| Time-based stock option [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Exercise price, lower range	4.61
Exercise price, upper range	16.58
$4.71 - $4.90 [Member] \| Performance-based stock options [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Exercise price, lower range	4.71	4.71
Exercise price, upper range	4.90	$ 4.90
Exercise price, lower range, Canceled	4.71
Exercise price, upper range, Canceled	4.90
$1.16 - 8.90 [Member] \| Time-based stock option [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Exercise price, lower range	1.16
Exercise price, upper range	8.90
$2.47 – 46.37 [Member] \| Time-based stock option [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Exercise price, lower range	2.47
Exercise price, upper range	46.37
$1.16 – 46.37 [Member] \| Time-based stock option [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Exercise price, lower range	1.16
Exercise price, upper range	$ 46.37

Organization and Significant Accounting Policies (Policy)	9 Months Ended
	Sep. 30, 2022
Organization and Significant Accounting Policies[Abstract]
Nature of Operations	We are a life science technology company that designs, develops, and manufactures advanced sequencing solutions to help scientists and clinical researchers resolve genetically complex problems. Our products and technology under development stem from two highly differentiated core technologies focused on accuracy, quality and completeness which include our existing HiFi long-read sequencing technology and our emerging short-read Sequencing by Binding (SBB^®) technology. Our products address solutions across a broad set of applications including human germline sequencing, plant and animal sciences, infectious disease and microbiology, oncology, and other emerging applications. Our focus is on providing our customers with advanced sequencing technologies with higher throughput and improved workflows that we believe will enable dramatic advancements in routine healthcare. Our customers include academic and governmental research institutions, commercial testing and service laboratories, genome centers, public health labs, hospitals and clinical research institutes, contract research organizations (CROs), pharmaceutical companies and agricultural companies.References in this report to “PacBio,” “we,” “us,” the “Company,” and “our” refer to Pacific Biosciences of California, Inc. and its consolidated subsidiaries.
Basis of Presentation and Consolidation	Basis of Presentation and Consolidation Our unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States, or U.S. GAAP, as set forth in the Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or ASC. The unaudited condensed consolidated financial statements include the accounts of Pacific Biosciences and our wholly owned subsidiaries. Certain information and footnote disclosures typically included in our audited financial statements have been condensed or omitted. The accompanying unaudited condensed consolidated financial statements have been prepared on a consistent basis with the December 31, 2021 audited consolidated financial statements and include all adjustments, consisting of only normal recurring adjustments, necessary to fairly state our financial position, results of operations, comprehensive (loss) income, and cash flows for the period, but are not necessarily indicative of the results to be expected for the entire year or any future periods. All intercompany transactions and balances have been eliminated. The financial statements should be read in conjunction with the audited consolidated financial statements and notes included in our Annual Report on Form 10-K for the year ended December 31, 2021.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes to the financial statements. On an ongoing basis, we evaluate our significant estimates including, but not limited to, the valuation of inventory, the determination of stand-alone selling prices for revenue recognition, the fair value of contingent consideration, the valuation of acquired intangible assets, the fair value of certain equity awards, the useful lives assigned to long-lived assets, the computation of provisions for income taxes, the borrowing rate used in calculating the operating lease right-of-use assets and operating lease liabilities, the probability associated with variable payments under partnership development agreements, and the valuations related to our convertible senior notes. While the extent of the potential impact of the current macroeconomic conditions and ongoing COVID-19 pandemic on our business is highly uncertain, we considered information available related to assumptions and estimates used to determine the results reported and asset valuations as of September 30, 2022. Actual results could differ materially from these estimates.
Cash, Cash Equivalents and Investments	Cash, Cash Equivalents, and Investments We consider all highly liquid investments purchased with an original maturity of 90 days or less to be cash equivalents. Cash equivalents may be comprised of money market funds, certificates of deposit, commercial paper, corporate bonds and notes, and government agencies’ securities. We classify our investments in debt securities as available-for sale and report the investments at fair value in current assets. We evaluate our available-for-sale investments in unrealized loss positions and assess whether the unrealized loss is credit-related. Unrealized gains and losses that are not credit-related are recognized in accumulated other comprehensive (loss) income in stockholders’ equity. Realized gains and losses, expected credit losses, as well as interest income, on available-for-sale securities are also reported in other income (expense), net. The cost used in the determination of gains and losses of securities sold is based on the specific identification method. The cost of marketable securities is adjusted for the amortization of premiums and discounts to expected maturity. Premium and discount amortization is recorded in other income (expense), net. Our investment portfolio at any point in time contains investments in cash deposits, money market funds, commercial paper, corporate debt securities and U.S. government and agency securities with high credit ratings. We have established guidelines regarding diversification and maturities of investments with the objectives of maintaining safety and liquidity, while maximizing yield.
Concentration and Credit Risks	Concentration and Other Risks For the three and nine months ended September 30, 2022, one customer accounted for approximately 13% and 11% of total revenue during the period. For the three and nine months ended September 30, 2021, one customer accounted for approximately 17% and 15% of total revenue during the period. No other customers exceeded 10% during those periods. As of September 30, 2022, 54% of our accounts receivable were from domestic customers, compared to 53% as of December 31, 2021. As of September 30, 2022, one customer represented 10% of our accounts receivable, while no customer represented 10% or greater of our net accounts receivable as of December 31, 2021.
Recent Accounting Pronouncements	Recent Accounting Pronouncements There are no accounting standards updates (“ASUs”) that have been recently adopted.
Significant Accounting Policies	Significant Accounting Policies There have been no changes to our significant accounting policies as disclosed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2021; however, as a result of certain changes to the standard contractual terms and conditions with customers implemented during the quarter ended March 31, 2022, we concluded that a change in the application of our accounting policy, in accordance with ASC 606, was appropriate. Specifically, we modified the standard contractual terms with customers during the first quarter of 2022, to reflect transfer of title and risk of loss and right to invoice upon delivery. We also updated the terms of the warranty provided with the instrument to remove the service component. As a result, the warranty is no longer a separate performance obligation and, accordingly, we accrue for the cost of the assurance warranty when revenue of the instrument is recognized. In addition, because of technical enhancements associated with our more recent instrument releases, including the Sequel IIe systems, installation services are now distinct from the instrument itself. Therefore, instrument revenue is now recognized upon transfer of control of the asset to the customer, which is generally upon delivery for sales made to our non-distributor customers.
Fair Value Of Financial Instruments Policy	Fair Value of Financial Instruments Fair value is the exchange price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy established under GAAP requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that may be used to measure fair value are as follows: Level 1: quoted prices in active markets for identical assets or liabilities; Level 2: inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3: unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. We consider an active market as one in which transactions for the asset or liability occurs with sufficient frequency and volume to provide pricing information on an ongoing basis. Conversely, we view an inactive market as one in which there are few transactions for the asset or liability, the prices are not current, or price quotations vary substantially either over time or among market makers. Where appropriate, our non-performance risk, or that of our counterparty, is considered in determining the fair values of liabilities and assets, respectively. We classify our cash deposits and money market funds within Level 1 of the fair value hierarchy because they are valued using bank balances or quoted market prices. We classify our investments as Level 2 instruments based on market pricing and other observable inputs. We did not classify any of our investments within Level 3 of the fair value hierarchy. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the entire fair value measurement requires management to make judgments and consider factors specific to the asset or liability. The carrying amount of our accounts receivable, prepaid expenses, other current assets, accounts payable, accrued expenses and other liabilities, current, approximate fair value due to their short maturities. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following table sets forth the fair value of our financial assets and liabilities that were measured on a recurring basis as of September 30, 2022 and December 31, 2021 respectively (in thousands):

Balance Sheet Components (Changes in Reserve for Product Warranties) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Balance Sheet Components [Abstract]
Balance at beginning of period	$ 1,609	$ 271	$ 594	$ 161
Additions charged to cost of product revenue	779	945	2,644	1,560
Repairs and replacements	(622)	(683)	(1,472)	(1,188)
Balance at end of period	$ 1,766	$ 533	$ 1,766	$ 533

Convertible Senior Notes

9 Months Ended

Sep. 30, 2022

Convertible Senior Notes [Abstract]

Convertible Senior Notes

NOTE 7. CONVERTIBLE SENIOR NOTES

On February 9, 2021, we entered into an investment agreement (the “Investment Agreement”) with SB Northstar LP (the “Purchaser”), a subsidiary of SoftBank Group Corp., relating to the issuance and sale to the Purchaser of $900 million in aggregate principal amount of our 1.50% Convertible Senior Notes (the “Notes”). The Notes were issued on February 16, 2021.

The Notes are governed by an indenture (the “Indenture”) between the Company and U.S. Bank National Association, as trustee. The Notes bear interest at a rate of 1.50% per annum. Interest on the Notes is payable semi-annually in arrears on February 15 and August 15 and commenced on August 15, 2021. The Notes will mature on February 15, 2028, subject to earlier conversion, redemption or repurchase.

The Notes are convertible at the option of the holder at any time until the second scheduled trading day prior to the maturity date, including in connection with a redemption by the Company. The Notes are convertible into shares of our common stock based on an initial conversion rate of 22.9885 shares of common stock per $1,000 principal amount of the Notes (which is equal to an initial conversion price of $43.50 per share), in each case subject to customary anti-dilution and other adjustments as a result of certain extraordinary transactions. Upon conversion of the Notes, we may elect to settle such conversion obligation in shares, cash or a combination of shares and cash.

On or after February 20, 2026, the Notes will be redeemable by the Company in the event that the closing sale price of our common stock has been at least 150% 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 we provide the redemption notice at a redemption price of 100% of the principal amount of such Notes, plus accrued and unpaid interest up to, but excluding, the redemption date.

With certain exceptions, upon a change of control of the Company or the failure of our common stock to be listed on certain stock exchanges (a “Fundamental Change”), the holders of the Notes may require that we repurchase all or part of the principal amount of the Notes at a purchase price of par plus unpaid interest up to, but excluding, the maturity date.

The Indenture includes customary “events of default,” which may result in the acceleration of the maturity of the Notes under the Indenture. The Indenture also includes customary covenants for convertible notes of this type.

To the extent we elect, the sole remedy for an event of default relating to our failure to comply with certain of our reporting obligations shall, for the first 360 calendar days after the occurrence of such an event of default, consist exclusively of the right to receive additional interest on the Notes at a rate equal to (i) 0.25% per annum of the principal amount of the Notes outstanding for each day during the first 180 calendar days of the 360-day period after the occurrence of such an event of default during which such event of default is continuing (or, if earlier, the date on which such event of default is cured or waived) and (ii) 0.50% per annum of the principal amount of the Notes outstanding for each day from, and including, the 181st calendar day to, and including, the 360th calendar day after the occurrence of such an event of default during which such event of default is continuing (or, if earlier, the date on which such event of default is cured or waived as provided for in the Indenture). On the 361st day after such event of default (if the event of default relating to our failure to comply with its obligations is not cured or waived prior to such 361st day), the Notes shall be subject to acceleration as provided for in the Indenture.

The Notes are accounted for in accordance with the authoritative guidance for convertible debt instruments that may be settled in cash upon conversion. Under ASU 2020-06, the guidance requires that debt with an embedded conversion feature is accounted for in its entirety as a liability and no portion of the proceeds from the issuance of the convertible debt instrument is accounted for as attributable to the conversion feature unless the conversion feature is required to be accounted for separately as an embedded derivative or the conversion feature results in a substantial premium. The conversion feature of the Notes is not accounted for as an embedded derivative because it is considered to be indexed to our common stock, and the Notes were not issued at a premium; therefore, the Notes are accounted for in their entirety as a liability. Because we may elect to settle any conversions entirely in shares, and because settlement in shares is the default settlement method, the liability is classified as non-current.

The requirement to repurchase the Notes including unpaid interest to the maturity date in the event of a Fundamental Change is considered a put option for certain periods requiring bifurcation under ASC 815 – Derivatives and Hedging. However, given the low probability of a Fundamental Change occurring during the applicable periods, the value of the embedded derivative is immaterial.

The additional interest feature in the event of our failure to comply with certain reporting obligations is also considered an embedded derivative requiring bifurcation under ASC 815. However, due to the nature and terms of the reporting obligations, the value of the embedded derivative is immaterial.

We incurred issuance costs related to the Notes of approximately $4.5 million, which were recorded as debt issuance cost and are presented as a reduction to the Notes on our Consolidated Balance Sheets and are amortized to interest expense using the effective interest method over the term of the Notes, resulting in an effective interest rate of 1.6%.

As of September 30, 2022 and December 31, 2021, the net carrying amount of the liability for the Notes is recorded as convertible senior notes, net, in the Condensed Consolidated Balance Sheets as follows (in thousands):



	September 30,		December 31,
	2022		2021
Principal amount	$	900,000	$	900,000
Unamortized debt issuance costs		(3,471)		(3,933)
Net carrying amount	$	896,529	$	896,067

For the three and nine months ended September 30, 2022, interest expense for the Notes was as follows (in thousands):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Contractual interest expense	$	3,375	$	3,375	$	10,125	$	8,438
Amortization of debt issuance costs		154		152		462		379
Total interest expense	$	3,529	$	3,527	$	10,587	$	8,817

As of September 30, 2022, the estimated fair value (Level 2) of the Notes was $554.4 million. The fair value of the Notes is estimated using a pricing model that is primarily affected by the trading price of our common stock and market interest rates.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

Business Acquisitions

9 Months Ended

Sep. 30, 2022

Business acquisitions [Abstract]

Business Acquisitions

NOTE 2. BUSINESS ACQUISITIONS

Omniome, Inc.

On September 20, 2021, we completed our acquisition of Omniome, Inc. (“Omniome”), a San Diego-based company, to obtain their proprietary short-read DNA sequencing platform capable of delivering high accuracy (the “Omniome acquisition”).

In connection with the Omniome acquisition, all outstanding equity securities of Omniome were cancelled in exchange for approximately $315.7 million in cash, 8,911,580 shares of our common stock with a fair value of $249.4 million and contingent consideration with a fair value of $168.6 million. The fair value of the 8,911,580 common shares issued was determined based on the closing market price of PacBio’s common shares on the acquisition date.

In addition, approximately $18.9 million, comprised of $7.4 million of cash, 226,811 shares of our common stock with a fair value of $6.3 million, and $5.2 million related to contingent consideration, was accounted for as a one-time post acquisition stock-based compensation expense. This stock-based compensation expense was due to accelerated vesting of Omniome stock awards in connection with the acquisition.

In connection with the acquisition, contingent consideration of $200 million (composed of $100 million in cash and $100 million in shares of our common stock) is due upon the achievement of a milestone, defined as the first commercial shipment to a customer of a nucleotide sequencing platform, comprising both an instrument and related consumables, that utilizes SBB technology. The number of shares of stock to be issued will be determined using the volume-weighted average of the trading prices of our common stock for the twenty trading days ending with and

including the trading day that is two days immediately prior to the achievement of the milestone. Of the $100 million in shares of our common stock to be issued as part of the milestone, $4.1 million was attributable to stock options issued by PacBio in replacement of Omniome’s unvested options as part of the transaction. Upon achievement of the milestone, shares will be issued not in excess of an amount equal to 19.9% of our outstanding shares of common stock on the date of closing (prior to the issuance of any shares issued in connection with the transaction or the related private placement), less 11,500,000 shares.

The contingent consideration is accounted for as a liability at fair value, with changes during each reporting period recognized in our Consolidated Statements of Operations and Comprehensive Loss. The fair value of the contingent consideration liability is calculated, with the assistance from a third-party valuation firm, using a scenario-based method which considers a range of possible outcomes and their assigned probabilities of occurrence. The potential outcomes are discounted to present value at a discount rate equal to the sum of the term-matched risk-free-interest rate plus PacBio’s credit spread.

The total consideration transferred for the acquisition is as follows (in thousands):



Total cash paid	$	315,703
Fair value of share consideration		249,435
Fair value of contingent consideration		168,574
Less: Stock-based compensation expense excluded from consideration transferred		(18,923)
Total consideration transferred	$	714,789

The acquisition was accounted for as a business combination and, accordingly, the total fair value of the consideration transferred was allocated to the tangible and intangible assets acquired and liabilities assumed based on their fair values on the acquisition date. As of December 31, 2021, the major classes of assets and liabilities to which we have allocated the total fair value of the consideration transferred were as follows (in thousands):



Cash and cash equivalents	$	15,338
Property and equipment, net		6,123
Operating lease right-of-use assets, net		18,095
In-process research and development ("IPR&D")		400,000
Goodwill		390,665
Other assets		3,203
Deferred income tax liability		(91,814)
Liabilities assumed		(26,821)
Total consideration transferred	$	714,789

During the year ended December 31, 2021, we recorded a measurement period adjustment of $1.6 million to decrease goodwill and a corresponding $0.4 million to decrease the deferred tax liability on the Consolidated Balance Sheet, and a $1.2 million decrease to our benefit from income taxes on the Consolidated Statements of Operations and Comprehensive (Loss) Income. The measurement period adjustment was due to new information that became available to us upon the completion of the IRC Section 382 Tax Study, where we identified additional net operating losses that are available to us from acquired assets. Refer to Note 9 – Income Taxes, in Part II, Item 8 of the Annual Report on Form 10-K for the year ended December 31, 2021 for more information.

The goodwill recognized was primarily attributable to the assembled workforce and synergies that are expected to occur from the integration of Omniome and is not deductible for income tax purposes.

We incurred costs related to the Omniome acquisition of approximately $11.6 million during the three and nine months ended September 30, 2021, which are included in merger-related costs on the Consolidated Statement of Operations and Comprehensive (Loss) Income. No significant merger-related costs were incurred during the three and nine months ended September 30, 2022.

The following unaudited pro forma financial information presents combined results of operations for each of the periods presented as if Omniome had been acquired as of the beginning of 2020, giving effect on a pro forma basis to the purchase accounting adjustments such as $11.6 million of PacBio acquisition-related costs, $18.9 million of stock-based compensation expense related to acceleration of certain Omniome stock options not attributable to pre-combination service, and a $92.2 million one-time income tax benefit from the reduction

of our deferred tax asset valuation allowance resulting from the Omniome acquisition, as well as a pro forma adjustment to reflect $16.7 million of Omniome’s acquisition-related costs.

The unaudited pro forma information presented below is for informational purposes only and is not necessarily indicative of the consolidated results of the combined business had the acquisition actually occurred at the beginning of 2020 or the results of future operations of the combined business.

The following table summarizes the unaudited pro forma financial information (in thousands):



	Three Months Ended		Nine Months Ended
	September 30, 2021		September 30, 2021
Pro forma total revenue	$	34,887	$	94,494
Pro forma net loss	$	(54,802)	$	(213,715)

Our consolidated financial statements include the results of operations for Omniome beginning September 20, 2021. Revenues of $0 and a net loss of $1.6 million from the acquired Omniome business have been included in our Condensed Consolidated Statement of Operations for the three and nine months ended September 30, 2021.

Circulomics, Inc.

On July 20, 2021, we acquired Circulomics Inc. (“Circulomics”), a Maryland-based biotechnology company focused on delivering highly differentiated sample preparation products that enable genomic workflows (the “Circulomics acquisition”).

We paid $29.5 million in cash in exchange for all outstanding shares of common stock of Circulomics. We allocated the consideration transferred to the identifiable assets acquired and liabilities assumed based on their respective fair values at the date of the completion of the Circulomics acquisition. The major classes of assets and liabilities to which we have allocated the total fair value of the consideration transferred were as follows (in thousands):



Cash and cash equivalents	$	987
Property and equipment, net		214
Intangible assets		11,360
Goodwill		19,309
Other assets		467
Deferred income tax liability		(2,672)
Liabilities assumed		(118)
Total consideration transferred	$	29,547

The excess of the value of consideration paid over the aggregate fair value of those net assets has been recorded as goodwill. We recognized goodwill of $19.3 million, which is primarily attributable to the synergies expected from capabilities in extraction and sample preparation and is not deductible for income tax purposes. We recorded $11.4 million for the fair value of acquired intangible assets, which consist of developed technology and customer relationships.

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Cash flows from operating activities
Net loss	$ (229,864)	$ (111,894)
Adjustments to reconcile net loss to net cash used in operating activities
Loss from Continuation Advances		52,000
Depreciation	6,937	4,943
Amortization of intangible assets	685	154
Amortization of right-of-use assets	5,152	2,403
Amortization of debt discount and financing costs	480	381
Stock-based compensation	60,658	54,417
Amortization from investment premium	1,069	3,107
Deferred income taxes		(94,824)
Change in the estimated fair value of contingent consideration	(2,221)
Loss on disposition of equipment	82
Changes in assets and liabilities
Accounts receivable	1,485	(6,871)
Inventory	(20,700)	(5,453)
Prepaid expenses and other assets	(5,685)	(1)
Accounts payable	1,511	196
Accrued expenses	(11,054)	10,267
Deferred revenue	(3,575)	17,930
Operating lease liabilities	(5,905)	(3,231)
Other liabilities	(1,700)	(2,996)
Net cash used in operating activities	(202,645)	(79,472)
Cash flows from investing activities
Purchase of property and equipment	(11,846)	(3,089)
Purchase of investments	(307,899)	(857,421)
Sales of investments		212,734
Maturities of investments	355,425	223,285
Net cash provided by (used) in investing activities	35,680	(744,284)
Cash flows from financing activities
Continuation Advances		(52,000)
Proceeds from issuance of Convertible Senior Notes, net of issuance costs		895,536
Proceeds from issuance of common stock under equity offerings, net of issuance costs		294,846
Proceeds from issuance of common stock from equity plans	9,983	30,121
Notes payable principal payoff	(1,180)
Other		(246)
Net cash provided by financing activities	8,803	1,168,257
Net (decrease) increase in cash and cash equivalents and restricted cash	(158,162)	344,501
Cash and cash equivalents and restricted cash at beginning of period	465,817	85,947
Cash and cash equivalents and restricted cash at end of period	307,655	430,448
Cash and cash equivalents at end of period	304,433	425,388
Restricted cash at end of period	$ 3,222	5,060
Supplemental disclosure of non-cash investing and financing activities
Issuance of common stock in acquisition of Omniome		237,884
Circulomics, Inc [Member]
Cash flows from investing activities
Cash paid for purchase of business acquisition, net of cash acquired		(28,560)
Omniome, Inc [Member]
Cash flows from investing activities
Cash paid for purchase of business acquisition, net of cash acquired		$ (291,233)

Financial Instruments

9 Months Ended

Sep. 30, 2022

Financial Instruments [Abstract]

Financial Instruments

NOTE 5. FINANCIAL INSTRUMENTS

Fair Value of Financial Instruments

Fair value is the exchange price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The fair value hierarchy established under GAAP requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that may be used to measure fair value are as follows:

Level 1: quoted prices in active markets for identical assets or liabilities;

Level 2: inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

Level 3: unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

We consider an active market as one in which transactions for the asset or liability occurs with sufficient frequency and volume to provide pricing information on an ongoing basis. Conversely, we view an inactive market as one in which there are few transactions for the asset or liability, the prices are not current, or price quotations vary substantially either over time or among market makers. Where appropriate, our non-performance risk, or that of our counterparty, is considered in determining the fair values of liabilities and assets, respectively.

We classify our cash deposits and money market funds within Level 1 of the fair value hierarchy because they are valued using bank balances or quoted market prices. We classify our investments as Level 2 instruments based on market pricing and other observable inputs. We did not classify any of our investments within Level 3 of the fair value hierarchy.

Assets and liabilities measured at fair value are classified in their entirety based on the lowest level input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the entire fair value measurement requires management to make judgments and consider factors specific to the asset or liability.

The carrying amount of our accounts receivable, prepaid expenses, other current assets, accounts payable, accrued expenses and other liabilities, current, approximate fair value due to their short maturities.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table sets forth the fair value of our financial assets and liabilities that were measured on a recurring basis as of September 30, 2022 and December 31, 2021 respectively (in thousands):



	September 30, 2022								December 31, 2021
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Cash and cash equivalents	$	63,154	$	241,279	$	—	$	304,433	$	327,315	$	133,410	$	—	$	460,725
Investments:
Commercial paper		—		57,408		—		57,408		—		187,632		—		187,632
Corporate debt securities		—		49,478		—		49,478		—		8,968		—		8,968
U.S. government & agency securities		—		423,021		—		423,021		—		387,075		—		387,075
Total investments		—		529,907		—		529,907		—		583,675		—		583,675

Short-term restricted cash		300		—		—		300		500		—		—		500
Long-term restricted cash		2,922		—		—		2,922		4,592		—		—		4,592
Total assets measured at fair value	$	66,376	$	771,186	$	—	$	837,562	$	332,407	$	717,085	$	—	$	1,049,492

Liabilities
Contingent consideration	$	—	$	—	$	167,496	$	167,496	$	—	$	—	$	169,717	$	169,717
Total liabilities measured at fair value	$	—	$	—	$	167,496	$	167,496	$	—	$	—	$	169,717	$	169,717

We classify contingent consideration, which was incurred in connection with the acquisition of Omniome, within Level 3 as factors used to develop the estimate of fair value include unobservable inputs that are not supported by market activity and are significant to the fair value.

We estimate the fair value of the contingent consideration liability by discounting the probability-weighted outcomes to present value using an estimate of our borrowing rate and the risk-free rate. The potential outcomes of milestone achievement dates are within the period from December 31, 2022 to June 30, 2025. A decrease in the probability of an earlier scenario within this range would result in a decrease in the fair value of the liability. The discount rates used are the sum of the U.S. risk-free rate and the estimated subordinated credit spread for B- and B credit rating, which range from 10.5% to 10.9%. An increase in the discount rates used can also result in the decrease in the fair value of liability, which was the primary factor for the $2.2 million decrease in liability at September 30, 2022. Changes in our estimated subordinated credit spread can result in changes in the fair value of the contingent consideration liability, where a lower credit spread may result in an increased liability valuation.

Changes in the estimated fair value of the contingent consideration liability for the nine months ended September 30, 2022 were as follows (in thousands):



		Level 3
Beginning balance as of December 31, 2021	$	169,717
Change in estimated fair value		(2,221)
Ending balance as of September 30, 2022	$	167,496

Changes to the fair value are recorded as Change in fair value of contingent consideration in the Condensed Consolidated Statement of Operations and Comprehensive (Loss) Income.

For the nine months ended September 30, 2022, there were no transfers between Level 1, Level 2, or Level 3 assets or liabilities reported at fair value on a recurring basis, and our valuation techniques did not change compared to the prior year.

‎

The following tables summarize our cash, cash equivalents and investments (in thousands):



	As of September 30, 2022
			Gross		Gross
	Amortized		unrealized		unrealized		Fair
	Cost		gains		losses		Value

Cash and cash equivalents		304,480		—		(47)		304,433
Investments:
Commercial paper		57,713		—		(305)		57,408
Corporate debt securities		50,098		2		(622)		49,478
U.S. government & agency securities		428,309		—		(5,288)		423,021
Total investments		536,120		2		(6,215)		529,907
Total cash, cash equivalents and investments	$	840,600	$	2	$	(6,262)	$	834,340

Short-term restricted cash	$	300	$	—	$	—	$	300
Long-term restricted cash	$	2,922	$	—	$	—	$	2,922

	As of December 31, 2021
			Gross		Gross
	Amortized		unrealized		unrealized		Fair
	Cost		gains		losses		Value

Cash and cash equivalents		460,731		—		(5)		460,725
Investments:
Commercial paper		187,705		—		(73)		187,632
Corporate debt securities		8,964		9		(5)		8,968
U.S. government & agency securities		388,088		1		(1,014)		387,075
Total investments		584,757		10		(1,092)		583,675
Total cash, cash equivalents and investments	$	1,045,488	$	10	$	(1,097)	$	1,044,400

Short-term restricted cash	$	500	$	—	$	—	$	500
Long-term restricted cash	$	4,592	$	—	$	—	$	4,592

The following table summarizes the contractual maturities of our cash equivalents and available-for-sale investments, excluding money market funds, as of September 30, 2022 (in thousands):



	Fair Value
Due in one year or less	$	670,316
Due after one year through five years		100,870
Total investments	$	771,186

Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations without call or prepayment penalties.

Revenue

9 Months Ended

Sep. 30, 2022

Revenue [Abstract]

Revenue

NOTE 11. REVENUE

A summary of our revenue by geographic location for the three and nine months ended September 30, 2022 and 2021 is as follows (in thousands):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Americas	$	16,743	$	19,368	$	57,547	$	45,872
Europe, Middle East and Africa		5,997		6,347		17,432		21,166
Asia-Pacific		9,571		9,172		25,972		27,456
Total	$	32,311	$	34,887	$	100,951	$	94,494

A summary of our revenue by category for the three and nine months ended September 30, 2022 and 2021 is as follows (in thousands):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Instrument revenue	$	11,442	$	15,926	$	42,611	$	45,147
Consumable revenue		16,067		14,576		43,317		37,191
Product revenue		27,509		30,502		85,928		82,338
Service and other revenue		4,802		4,385		15,023		12,156
Total revenue	$	32,311	$	34,887	$	100,951	$	94,494

- 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 https://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Financial Instrument (Summary of Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Assets
Cash and cash equivalents	$ 304,433	$ 460,725
Total investments	529,907	583,675
Short-term restricted cash	300	500
Long-term restricted cash	2,922	4,592
Total assets measured at fair value	837,562	1,049,492
Liabilities
Fair value of contingent consideration	167,496	169,717
Total liabilities measured at fair value	167,496	169,717
Commercial paper, not included with cash and cash equivalents [Member]
Assets
Total investments	57,408	187,632
Corporate debt securities [Member]
Assets
Total investments	49,478	8,968
U.S. government & agency securities, not included with cash and cash equivalents [Member]
Assets
Total investments	423,021	387,075
Level 1 [Member]
Assets
Cash and cash equivalents	63,154	327,315
Short-term restricted cash	300	500
Long-term restricted cash	2,922	4,592
Total assets measured at fair value	66,376	332,407
Level 2 [Member]
Assets
Cash and cash equivalents	241,279	133,410
Total investments	529,907	583,675
Total assets measured at fair value	771,186	717,085
Level 2 [Member] \| Commercial paper, not included with cash and cash equivalents [Member]
Assets
Total investments	57,408	187,632
Level 2 [Member] \| Corporate debt securities [Member]
Assets
Total investments	49,478	8,968
Level 2 [Member] \| U.S. government & agency securities, not included with cash and cash equivalents [Member]
Assets
Total investments	423,021	387,075
Level 3 [Member]
Liabilities
Fair value of contingent consideration	167,496	169,717
Total liabilities measured at fair value	$ 167,496	$ 169,717

Condensed Consolidated Statements of Stockholders’ Equity - USD ($) shares in Thousands, $ in Thousands	Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Other Comprehensive (Loss) Income [Member]	Accumulated Deficit [Member]	Total
Balance at Dec. 31, 2020	$ 192	$ 1,372,083	$ 85	$ (1,036,869)	$ 335,491
Balance, shares at Dec. 31, 2020	192,294
Net (loss) income				(111,894)	(111,894)
Other comprehensive income (loss)			(58)		(58)
Issuance of common stock in conjunction with equity plans	$ 9	30,113			30,122
Issuance of common stock in conjunction with equity plans, shares	8,126
Issuance of common stock in Private Placement, net of issuance costs	$ 11	294,834			294,845
Issuance of common stock in Private Placement, net of issuance costs, Shares	11,215
Issuance of common stock in acquisition of Omniome	$ 9	237,875			237,884
Issuance of common stock in acquisition of Omniome, shares	8,912
Stock-based compensation expense		54,417			54,417
Balance at Sep. 30, 2021	$ 221	1,989,322	27	(1,148,763)	840,807
Balance, shares at Sep. 30, 2021	220,547
Balance at Jun. 30, 2021	$ 199	1,423,357	(6)	(1,165,305)	258,245
Balance, shares at Jun. 30, 2021	198,917
Net (loss) income				16,542	16,542
Other comprehensive income (loss)			33		33
Issuance of common stock in conjunction with equity plans	$ 2	4,809			4,811
Issuance of common stock in conjunction with equity plans, shares	1,503
Issuance of common stock in Private Placement, net of issuance costs	$ 11	294,834			294,845
Issuance of common stock in Private Placement, net of issuance costs, Shares	11,215
Issuance of common stock in acquisition of Omniome	$ 9	237,875			237,884
Issuance of common stock in acquisition of Omniome, shares	8,912
Stock-based compensation expense		28,447			28,447
Balance at Sep. 30, 2021	$ 221	1,989,322	27	(1,148,763)	840,807
Balance, shares at Sep. 30, 2021	220,547
Balance at Dec. 31, 2021	$ 221	2,009,945	(1,087)	(1,218,092)	$ 790,987
Balance, shares at Dec. 31, 2021	220,978				220,978
Net (loss) income				(229,864)	$ (229,864)
Other comprehensive income (loss)			(5,173)		(5,173)
Issuance of common stock in conjunction with equity plans	$ 5	9,978			9,983
Issuance of common stock in conjunction with equity plans, shares	4,938
Stock-based compensation expense		60,658			60,658
Balance at Sep. 30, 2022	$ 226	2,080,581	(6,260)	(1,447,956)	$ 626,591
Balance, shares at Sep. 30, 2022	225,916				225,916
Balance at Jun. 30, 2022	$ 225	2,058,103	(5,457)	(1,370,985)	$ 681,886
Balance, shares at Jun. 30, 2022	224,756
Net (loss) income				(76,971)	(76,971)
Other comprehensive income (loss)			(803)		(803)
Issuance of common stock in conjunction with equity plans	$ 1	3,542			3,543
Issuance of common stock in conjunction with equity plans, shares	1,160
Stock-based compensation expense		18,936			18,936
Balance at Sep. 30, 2022	$ 226	$ 2,080,581	$ (6,260)	$ (1,447,956)	$ 626,591
Balance, shares at Sep. 30, 2022	225,916				225,916

Financial Instruments (Summary of Contractual Maturities of Cash Equivalents and Available-for-Sale Investments) (Details) $ in Thousands	Sep. 30, 2022 USD ($)
Cash, Cash Equivalents and Investments [Abstract]
Due in one year or less	$ 670,316
Due after one year through five years	100,870
Total investments	$ 771,186