Illumina (ILMN -1.75%) reported its first-quarter results on April 27, 2021. The company delivered strong growth, but its full-year outlook wasn't quite as strong as some might expect it would be. In this Motley Fool Live video, recorded on April 28, Motley Fool contributors Keith Speights and Brian Orelli talk about Illumina's Q1 results and whether or not the company's management team might have sandbagged somewhat with its guidance.

Keith Speights: Let's switch to another earnings story outside of the drugmaker arena. Illumina, ticker there is ILMN, Illumina's a gene sequencing pioneer. Illumina reported its first-quarter earnings on Tuesday. The company had already given us a sneak peek at its revenue several weeks ago.

Brian, were there any surprises in Illumina's Q1 update or was it pretty much what you were looking for?

Brian Orelli: We already knew about the revenue going up 27 percent, adjusted earnings per share were only up 15 percent, I think that was new and I think they don't pre-release earnings.

It looks like the culprit was selling, general, and administrative expenses that jumped 36 percent, larger than revenue. It's many times you have some expenses growing faster than revenue that's going to cut into your earnings line.

I continue to be puzzled by the 2021 revenue guidance of 25 to 28 percent. The 27 percent in the first quarter is bracketed in the guidance brackets that 27 percent. But the second quarter of last year is going to be an easy comp because labs were shut down in the second quarter of last year.

It seems like it should grow a lot faster in the second quarter than 27-28 percent. That would seem like there's going to be a slowdown in the second half of the year. I'm still a little confused as to why guidance is so low when they have such a low comp for at least the second quarter of last year.

Speights: Yeah. I wouldn't be surprised, Brian, if Illumina's management is sandbagging somewhat. If you go back several years, the company's management team really drew some flak because they would be too aggressive in their guidance and then miss it or not beat it very much and it ended up hurting the company or hurting the stock anyway over the short term.

A few years ago, I noticed that Illumina's management team made a decided shift and they started to be more conservative in their guidance. I think you're right, I think that 27-28 percent growth seems on the low end. I suspect that they're being ultraconservative.

Orelli: That seems reasonable. That seems like a reasonable hypothesis.

Speights: I did notice one thing that I would not have noticed otherwise except Illumina's CEO pointed it out in the update yesterday, but this was Illumina's very first quarter to achieve at least 1 billion dollars in revenue in the company's history. It was the company's best quarter ever.

Orelli: It's a good milestone.

Speights: Yeah. So, looking up for Illumina.