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Illumina Reports Preliminary First-Quarter Revenue, Withdraws Full-Year Guidance

By Eric Volkman - Apr 15, 2020 at 11:05AM

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The biotech expects a tough second quarter, but maintains that its long-term prospects are solid.

Illumina's (ILMN -8.40%) revenue is on the rise, according to preliminary results for the first quarter, which the company released on Tuesday. Those figures indicate that the genetic-sequencing specialist will book $858 million on the top line for the quarter, which would be 1.4% higher than its Q1 2019 result.

Illumina said that revenues during the quarter were bolstered by robust sales of genetic-sequencing consumables, which more than compensated for the deleterious effects of the SARS-CoV-2 coronavirus outbreak on its business. But Illumina did say its system sales in the last two weeks of March were particularly impacted by the coronavirus.

Strands of DNA.

Image source: Getty Images.

With the many pandemic-related shutdowns and their consequent dampening of business across most economic sectors, the gene-sequencing specialist is anticipating sustained negative impact to its business in the second quarter. The company said that at the moment, it's impossible to forecast how large an impact that will be.

For that reason, Illumina management withdrew its revenue and profitability guidance for the entirety of 2020. Previously, the company had estimated that its revenue would grow by 9% to 11%, with non-GAAP (adjusted) diluted earnings per share coming in at $6.80 to $7.00. The latter would represent year-over-year growth of 3.5% to 6.5%. 

Still, the biotechnology company sounded an optimistic note about its mid- to long-term future. Of the coronavirus, it said: "We are confident that this is a temporary disruption that in no way alters the long-term trajectory of sequencing adoption and demand."

Illumina shares were trading down by 2.3% on Wednesday morning, more or less keeping pace with the declines in the broader equity market.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Illumina. The Motley Fool has a disclosure policy.

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