PacBio Announces Third Quarter 2024 Financial Results

PacBio Announces Third Quarter 2024 Financial

MENLO PARK, Calif., Nov. 07, 2024 (GLOBE NEWSWIRE) - PacBio

(NASDAQ: PACB) today announced financial results for the quarter ended September 30, 2024.

Third quarter results:

Gross profit, operating expenses, net loss, and net loss per share

are reported on a GAAP and non-GAAP basis. The non-GAAP measures are described below and reconciled to the corresponding GAAP measures

at the end of this release.

Gross profit for the third quarter of 2024 was $10.0 million, which

reflected a $3.2 million expense related to the amortization of acquired intangible assets, compared with $17.9 million for the third

Operating expenses totaled $74.1 million for the third quarter of 2024,

compared to $100.4 million for the third quarter of 2023. Operating expenses for the third quarter of 2024 included $6.9 million of restructuring

expenses, $3.6 million related to the amortization of acquired intangible assets, and $1.2 million related to the change in fair value

of contingent consideration. Operating expenses for the third quarter of 2024 and the third quarter of 2023 included non-cash share-based

compensation of $17.0 million and $18.6 million, respectively.

Net loss for the third quarter of 2024 was $60.7 million, compared

to a net loss of $66.9 million for the third quarter of 2023.

Net loss per share for the third quarter of 2024 was $0.22, compared

to net loss per share of $0.26 for the third quarter of 2023.

Cash, cash equivalents, and investments, excluding short- and long-term

restricted cash, at September 30, 2024, totaled $471.1 million, compared to $631.4 million at December 31, 2023.

Non-GAAP third quarter results (see accompanying tables for

reconciliations of GAAP and non-GAAP measures):

Non-GAAP gross profit for the third quarter of 2024 was $13.0 million

compared with $18.1 million for the third quarter of 2023 and a non-GAAP gross margin of 33% in the third quarter of 2024 compared to

32% for the third quarter of 2023.

Non-GAAP operating expenses totaled $62.4 million for the third quarter

of 2024, compared to $90.9 million for the third quarter of 2023.

Non-GAAP net loss for the third quarter of 2024 was $46.0 million,

compared to a non-GAAP net loss of $67.9 million for the third quarter of 2023.

Non-GAAP net loss per share for the third quarter of 2024 was $0.17

compared to a non-GAAP net loss per share of $0.27 for the third quarter of 2023.

Updates since PacBio's last earnings release

"While PacBio continued to operate in a difficult macro environment

for capital purchases in the third quarter, we saw several positive signs that lead us to believe that we are on the path to return to

growth in 2025 and beyond," said Christian Henry, President and Chief Executive Officer. "We're seeing sequential growth in

consumables with growing sequencing data output, continued Revio adoption from new customers, and a record quarter for Onso. Meanwhile,

we continue to decrease our cash burn and remain committed to our goal of being cashflow positive exiting 2026. Additionally, we're

strengthening our balance sheet by reducing our total debt while balancing dilution through our recently announced note exchange with

SoftBank. With the launch of our SPRQ chemistry and the Vega benchtop system, PacBio is delivering on its strategy to bring a suite of

advanced platforms and solutions to the market and expand HiFi's ability to reach more customers than ever before."

Quarterly Conference Call Information

Management will host a quarterly conference call to discuss its third

quarter ended September 30, 2024, results today at 4:30 p.m. Eastern Time. Investors may listen to the call by dialing 1-888-349-0136,

if outside the U.S., by dialing 1-412-317-0459, requesting to join the "PacBio Q3 Earnings Call". The call will be webcast

live and available for replay at PacBio's website at https://investor.pacificbiosciences.com.

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

PacBio reports non-GAAP results for basic and diluted net income and

loss per share, net income, net loss, gross margins, gross profit and operating expenses in addition to, and not as a substitute for,

or because it believes that such information is superior to, financial measures calculated in accordance with GAAP. 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 financial information 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.

PacBio's financial measures under GAAP include substantial charges

that are listed in the itemized reconciliations between GAAP and non-GAAP financial measures included in this press release. PacBio excludes

recurring charges from its non-GAAP financial statements, including amortization of intangible assets, changes in fair value of contingent

consideration and restructuring related expenses, and further excludes infrequent and limited charges including impairment charges and

gains or losses on the extinguishment of debt. The amortization of acquired intangible assets excluded from GAAP financial measures relates

to acquired intangible assets that were recorded as part of the purchase accounting during the year ended December 31, 2021. The amortization

related to these intangible assets will occur in future periods until they are fully amortized.

Management has excluded the effects of these items in non-GAAP measures

to assist investors in analyzing and assessing past and future operating performance. In addition, management uses non-GAAP measures to

compare PacBio's performance relative to forecasts and strategic plans and to benchmark its performance externally against competitors.

PacBio encourages investors to carefully consider its results under

GAAP, as well as its supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand its

business. A reconciliation of PacBio's non-GAAP financial measures to their most directly comparable financial measure stated in

accordance with GAAP has been provided in the financial statement tables included in this press release. PacBio is unable to reconcile

future-looking non-GAAP guidance included in this press release without unreasonable effort because certain items that impact this measure

are out of PacBio's control and/or cannot be reasonably predicted at this time.

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 note exchange transaction and its anticipated financial impact and closing timing; cost-saving plans and initiatives as

well as the expected financial impact and timing of these plans and initiatives; PacBio's financial guidance and expectations for

future periods; developments affecting our industry and the markets in which we compete, including the impact of new products and technologies;

anticipated future customer use of our products; and the availability, uses, accuracy, coverage, advantages, quality or performance of,

or benefits or expected benefits of using, PacBio products or technologies; and, the impact of new products and technologies. 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 statements because they are subject to assumptions, risks, and uncertainties and could cause actual outcomes

and results to differ materially from currently anticipated results, including, challenges inherent in developing, manufacturing, launching,

marketing and selling new products, and achieving anticipated new sales; potential cancellation of existing instrument orders; assumptions,

risks and uncertainties related to the ability to attract new customers and retain and grow sales from existing customers; risks related

to PacBio's ability to successfully execute and realize the benefits of acquisitions; the impact of U.S. export restrictions on the shipment

of PacBio products to certain countries; rapidly changing technologies and extensive competition in genomic sequencing; unanticipated

increases in costs or expenses; interruptions or delays in the supply of components or materials for, or manufacturing of, PacBio products

and products under development; potential product performance and quality issues and potential delays in development timelines; the possible

loss of key employees, customers, or suppliers; customers and prospective customers curtailing or suspending activities using PacBio's

products; third-party claims alleging infringement of patents and proprietary rights or seeking to invalidate PacBio's patents or proprietary

rights; risks associated with international operations; and other risks associated with general macroeconomic conditions and geopolitical

instability. Additional factors that could materially affect actual results can be found in PacBio's most recent filings with the Securities