10x Genomics (TXG 8.44%) has been sizzling hot for much of 2021 so far. It hasn't hurt that Cathie Wood has been busy scooping up shares of the genomics company for her ARK Innovation ETF.

However, that sizzle seems likely to fizzle somewhat now. 10x Genomics announced its first-quarter results after the market closed Wednesday. The life sciences stock sank nearly 10% in after-hours trading. Here are the highlights from the company's Q1 update.

A DNA double helix with an image of a person's head and 1s and 0s in the background.

Image source: Getty Images.

By the numbers

10x Genomics reported revenue in the first quarter of $105.8 million, an impressive 47% year-over-year jump. This result topped the average analysts' estimate of $102.5 million.

The company announced a net loss of $11.6 million, or $0.11 per share, in the first quarter based on generally accepted accounting principles (GAAP). In the prior-year period, 10x posted a GAAP net loss of $21.1 million, or $0.22 per share. The consensus Wall Street estimate projected a Q1 net loss of $0.27 per share.

10x ended the first quarter with cash and cash equivalents of $617.2 million. This cash position was down slightly from the $663.6 million on hand as of Dec. 31, 2020.

Behind the numbers

10x Genomics CEO Serge Saxonov said, "We had a solid start to the year highlighted by strong growth across the business and the incredible response to the innovation revealed at our inaugural Xperience event." That strong growth was primarily due to higher consumables revenue.

This fits right into 10x's strategy. As the company builds the installed base for its genomic-sequencing instruments, consumables revenue will naturally increase.

10x's gross margin rose to 84% in the first quarter of 2021 from 79% in the prior-year period. This solid increase stemmed primarily from lower accrued royalties connected to an ongoing legal dispute.

Despite this higher gross margin, the company's bottom line deteriorated. The main culprit was significantly higher stock-based compensation expenses than in the prior-year period.

Looking ahead

10x Genomics maintained its full-year 2021 revenue guidance of between $480 million and $500 million. This range reflects year-over-year growth of between 61% and 67%. The midpoint of the range is a little short of the consensus Wall Street revenue estimate of $495 million.

However, the long-term prospects for 10x appear to be quite good. Saxonov said, "The 10x team is focused on product innovation and committed to delivering a great experience for our customers as we look to drive the Century of Biology."