Illumina (ILMN -0.06%) downright disappointed investors with its second-quarter results in July, reporting slowing revenue growth and a year-over-year decline in adjusted earnings. However, CEO Francis deSouza said at the time that this wasn't "a new normal" for the gene-sequencing leader.
The company proved deSouza right -- sort of -- when it announced its third-quarter results after the market closed on Thursday. But it was also clear that Illumina hasn't yet returned to its "old normal" of sizzling revenue growth.

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The key numbers
Illumina reported Q3 revenue of $907 million, up 6% year over year. This figure was much higher than the consensus analysts' revenue estimate of $870.8 million.
The company announced net income in the third quarter of $234 million, or $1.58 per diluted share, based on generally accepted accounting principles (GAAP). This reflected a significant improvement from the prior-year period GAAP earnings of $199 million, or $1.33 per share.
Illumina posted adjusted earnings of $286 million, or $1.93 per diluted share. This was a huge jump from the adjusted earnings of $227 million, or $1.52 per share, reported in the same quarter last year. It also trounced the average Wall Street analysts' earnings estimate of $1.40 per share.
The company generated operating cash flow of $267 million and free cash flow of $218 million in the third quarter. Both figures reflected declines from the prior-year period. Illumina ended Q3 with cash, cash equivalents, and short-term investments totaling $3.2 billion.
Behind those numbers
The company beat Wall Street estimates on both the top and bottom lines by a lot. Were investors excited? Not really. It was more of an indication that analysts were too pessimistic than a reason to celebrate Illumina's performance. Although Francis deSouza said that Q3 "was a solid quarter for Illumina," he added that the company's product revenue was in line with the company's own internal expectations.
The reality is that Illumina remains well off-track from being the growth stock that it once was. Probably the main culprit is the company's microarray business, with revenue falling nearly 24% year over year and 7% quarter over quarter, to $102 million. Weakness in the direct-to-consumer personal genomics business continued to weigh on the company.
Instrument sales also slipped nearly 6% from the prior-year period, to $146 million. The good news, though, was that this represented a jump of close to 10% from the second quarter.
Illumina's bottom line improved nicely, as well, thanks mainly to the company keeping a lid on spending. Operating expenses declined nearly 5% year over year, to $340 million. The company also benefited from lower income taxes in the third quarter of 2019, compared to the same quarter a year ago.
Looking ahead
Illumina maintained its full-year 2019 revenue guidance of year-over-year revenue growth of around 6%. However, the company raised its full-year earnings outlook. Illumina now projects GAAP earnings per share of between $6.55 and $6.60, up from its previous guidance of between $6.41 and $6.51. It also expects adjusted earnings per share between $6.40 and $6.45, higher than the earlier projection of non-GAAP earnings per share between $6 and $6.10.
Perhaps the biggest question now for Illumina is what will happen with its planned acquisition of Pacific Biosciences of California. The United Kingdom's Competition and Markets Authority (CMA) announced today a provisional decision that would block the deal, based on concerns that it would limit competition in the gene-sequencing market.