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Illumina stock tanks as gene-sequencing company misses expectations and issues bleak outlook

by Atlanta Business Journal

Illumina Inc. shares sank 20% after hours Thursday after the gene-sequencing company swung to a loss in the second quarter, fell short of revenue expectations and revised its full-year outlook downward.

Francis deSouza, chief executive of Illumina
ILMN,
+0.06%
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said in a statement that the quarterly results failed to meet the company’s own expectations because “challenges in a complex macroeconomic environment more than offset the growth we continue to see in sequencing runs on our platforms.”

Illumina reported a loss of $535 million, or $3.40 a share, compared with net income of $187 million, or $1.26 a share, in the year-ago period. Adjusted for $609 million in legal contingencies, plus selling, general and administrative expenses and other costs, earnings were 57 cents a share. Revenue rose to $1.16 billion from $1.13 billion in the year-ago quarter. Analysts surveyed by FactSet had forecast earnings of 64 cents a share on revenue of $1.22 billion.

The company said in a news release that it expects full-year revenue for 2022 to grow 4% to 5% from fiscal-year 2021, citing “ongoing negative impact of foreign exchange rates, customer lab expansion delays, and macroeconomic-driven conservatism around immediate capital and inventory commitments, including in Greater China.” Last quarter, the company said it expected 14% to 16% revenue growth for fiscal-year 2022.

Illumina also said it expects to post a per-share loss of $2.93 to $2.78 for the full year. Analysts had expected net income of $2.94 a share.

Shares of Illumina ended the regular session up slightly, 0.06%, at $227.44, before plunging in extended trading. They have declined 40% year to date, while the S&P 500 index
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-0.07%

has fallen almost 12% during the same period. The company’s stock dropped sharply in June after it announced that its chief financial officer was leaving for Quest Diagnostics Inc.
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-0.29%
.

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