Full Press Release Details
PacBio Announces Preliminary First Quarter 2024
Revenue and Updates 2024 Revenue Guidance
Announces Plan to Reduce Annualized Operating
Expense Run Rate by $50 - $75 Million
Q1 2024 Earnings Conference Call Scheduled
MENLO PARK, Calif. - April 16, 2024 /PRNewswire/
- PacBio (NASDAQ: PACB) today announced preliminary, unaudited revenue for the quarter ended March 31, 2024.
Preliminary First Quarter Results
Preliminary revenue for the first quarter was below the company's
expectations due to an increasing number of customers delaying instrument purchases and softness in consumable shipments.
All regions underperformed, with 13 Revio systems falling out of the
forecast in the last couple of weeks in the first quarter, which the company believes primarily resulted from elongated customer purchasing
cycles. The median sales cycle for Revio instrument purchases increased more than expected in the first quarter of 2024. PacBio believes
that these instruments continue to be strong sales opportunities that are likely to close in 2024. PacBio believes additional reasons
for the shortfall include:
Consumable revenue was also below expectations, which the company believes
was primarily attributed to: `
Commentary by Christian Henry, President and CEO of PacBio:
"Following the successful launch of the Revio system and a record
2023, we entered the year with optimism regarding our growth prospects. As we reached the last couple of weeks of the first quarter, however,
we saw an increasing number of customers delay instrument purchases and we experienced some unexpected softness in consumable shipments.
As a result, the first quarter came in below our original expectations. We expect these factors to have an impact on our 2024 performance,
and we expect to provide further details on our full year outlook on our earnings call scheduled for May 9, 2024."
"Looking ahead, we are focused on four strategic priorities.
First, improving commercial execution to drive adoption of both the Revio and Onso platforms; second, continuing the development of our
benchtop long read and high throughput short-read platforms; third, implementing projects to improve our gross margin and drive manufacturing
efficiencies; and finally, reducing annualized run-rate operating expenses on a non-GAAP basis by $50 million to $75 million by the end
of 2024 in relation to our prior guidance of 5% operating expense growth. "
"Despite these near-term headwinds, we remain highly encouraged
by PacBio's long-term growth potential. We are continuing to see new customers adopt Revio as evidenced by the fact that nearly
60% of our Revio placements in the quarter were to new customers. We are also starting to see significant traction with large-scale projects,
such as the Estonia National Biobank project announced last month, the first Revio in Latin America to be used for a 1,000-sample whole
genome project, and pediatric genome initiatives at hospitals in Canada and Korea. Additionally, we expect consumables to return to sequential
growth going forward this year as we continue to grow the Revio installed base and see encouraging trends that point toward increased
sequencing on the Revio system. It should be noted that March Revio utilization was at an all-time high - including some of our
top customers exceeding our expectations. We have expanded the capabilities of the Revio platform through the roll-out of v13 software
upgrade which has enabled our customers with more functionality and better performance. We've also recently launched new reagent
kits that improve our customer workflows and launched our new Kinnex kits to continue to drive new customer adoption."
"I am confident in our ability to create value for all our stockholders
and stakeholders. PacBio has some of the world's most advanced sequencing technology and our customers continue to uncover insights
into the genome unimaginable with other technologies."
Updated Guidance and Financial Outlook
Revenue in the first quarter was significantly lower than expected,
and as a result, PacBio now expects 2024 revenue to be in the range of $170 million to $200 million. The company believes that second
quarter revenue will improve over the first quarter and that the second half of the year will improve sequentially as consumables return
to sequential growth and the company closes some of the deals that were delayed in the first quarter. At the midpoint of $185 million,
the company believes that total Revio shipments for 2024 will be around 120 systems. At the midpoint of the revised guidance, the company
expects that consumable revenue will be around $80 million and consumable pull-through on the Revio system will be around $290,000 per
Given the company's lowered outlook for 2024, PacBio believes
it is unlikely to achieve its long-term revenue guidance of at least $500 million in 2026 and is reevaluating the timing of achieving
it. The company expects to provide more details on its financial performance and outlook on its earnings call scheduled on May 9, 2024.
With the reduced revenue forecast and the planned cost reduction initiatives,
PacBio currently expects to end 2024 with cash, cash equivalents, and investments balance in the range of $435 million to $450 million
The preliminary unaudited financial
information set forth above is subject to revision and is anticipated to be finalized in May 2024. PacBio's financial results could
differ materially from the preliminary estimates above, which are not a comprehensive statement of PacBio's financial results and are
not necessarily indicative of the results to be expected as of or for the fiscal period ended March 31, 2024, or any future period. Accordingly,
you should not place undue reliance on these preliminary estimates.
Quarterly Conference Call Information
PacBio will hold its quarterly conference call on Thursday, May 9,
2024, at 5:00 p.m. Eastern Time to discuss its first quarter 2024 financial results. The call will be webcast and may be accessed at
PacBio's website at https://investor.pacificbiosciences.com/.
Date: Thursday, May 9, 2024, at 5:00 pm ET (2:00 pm PT)
Listen live via internet or replay: https://investor.pacificbiosciences.com/
Toll-free: 1-888-349-0136
International: 1-412-317-0459
If using the dial-in option, please dial into the call ten minutes
prior to start time using the appropriate number above and ask to join the "PacBio Q1 Earnings Call."
PacBio (NASDAQ: PACB) is a premier life science technology company
that designs, develops, and manufactures advanced sequencing solutions to help scientists and clinical researchers resolve genetically
complex problems. Our products and technologies stem from two highly differentiated core technologies focused on accuracy, quality and
completeness which include our HiFi long-read sequencing and our SBB short-read sequencing technologies. Our products address solutions
across a broad set of research applications including human germline sequencing, plant and animal sciences, infectious disease and microbiology,
oncology, and other emerging applications. For more information, please visit www.pacb.com and follow @PacBio.
PacBio products are provided for Research Use Only. Not for use in
diagnostic procedures.
Statement regarding use of non-GAAP financial measures
This press release refers to non-GAAP operating expenses, which PacBio
reports in addition to, and not as a substitute for, financial measures calculated in accordance with GAAP. For more information on how
PacBio defines non-GAAP operating expenses, see the tables included with our fourth quarter 2023 earnings press release dated February
15, 2024. PacBio is unable to reconcile the non-GAAP operating expense numbers included in this press release because certain items that
impact this measure are out of PacBio's control and/or cannot be reasonably predicted at this time.
PacBio believes that non-GAAP financial information, when taken collectively,
may be helpful to investors because it provides consistency and comparability with past financial performance. However, non-GAAP information
is not superior to financial measures calculated in accordance with GAAP, is presented for supplemental informational purposes only, has
limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in
accordance with GAAP. In addition, other companies may calculate similarly titled non-GAAP measures differently or may use other measures
to evaluate their performance, all of which could reduce the usefulness of PacBio's non-GAAP financial measures as tools for comparison.
Forward-Looking Statements
This press release contains "forward-looking statements"
within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and the U.S. Private Securities Litigation Reform
Act of 1995. All statements other than statements of historical fact are forward-looking statements, including statements relating to
PacBio's preliminary unaudited financial information as of and for the periods ended March 31, 2024; the availability or timing
of PacBio's final financial results as of and for the periods ended March 31, 2024; PacBio's expectations for future operating
results, revenue and guidance; PacBio's cost-saving plans and initiatives as well as the expected financial impact and timing of
these plans and initiatives; risks that the operating expense reductions may have an adverse impact on PacBio's business and results
of operations; risks that charges associated with the Company's operating expense reductions may be greater than anticipated; the
availability, uses, accuracy, coverage, advantages, quality or performance of, or benefits or expected benefits of using, PacBio products
or technologies; anticipated demand for PacBio's products and technologies in future periods. Reported results and orders for any
instrument system should not be considered an indication of future performance. You should not place undue reliance on forward-looking