What happened

Shares of Pacific Biosciences of California (NASDAQ:PACB), a genetic-sequencing system manufacturer, rose 11% on Thursday and continued their climb into Friday's session. Investors appear pleased with new productivity-boosting tools to be featured at this week's meeting of the American Society for Microbiology.

So what 

Pacific Biosciences' single-molecule DNA-reading system is widely considered more accurate than more popular methods that splice together data from thousands of copies. Accuracy has made PacBio's Sequel System a leading choice for academic researchers. And a new addition that makes it easier to sequence multiple microbes at the same time will help cement its position among microbiologists.

Person drawing an upward sloping chart with their fingers.

Image source: Getty Images.

Now what

Helping scientists lower per-sample costs by increasing throughput is a great way to please customers while boosting the recurring revenue that consumable chips and reagents generate. PacBio needs to execute on this front soon, or it could find itself in a tough spot. Total revenue fell 22% in the first quarter compared to the previous year, although shipping delays were partly to blame.

After losing $24 million during the first three months of 2018, the company finished March with just $79 million in cash, cash equivalents, and short-term investments. If product revenue doesn't start moving in the right direction again soon, raising more capital could get tricky.

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