Key Points
- Revenue for Q2 2024 rose to $153.1 million, up 4% year-over-year but below management's expectations.
- Operating expense decreased by 10%, resulting in a narrower net loss of $37.9 million.
- Management cut its full-year revenue forecast outlook to $640 million to $660 million, or about 4% less that past estimates.
10x Genomics (TXG -0.55%), which makes gene sequencing and analysis systems, said second-quarter revenue rose 4%, which was short of management's forecast. At the same time, the company trimmed its full-year revenue expectations.
Revenue rose to $153.1 million from $146.8 million, well below management's 2024 estimate of 8% to 12% growth, according to an Aug. 6 news release. The company now expects full-year revenue of $640 million to $660 million, or about 4% below past projections. Operating expense fell 10%, leading to a net loss of $37.9 million, down from from $62.4 million in the same quarter last year.
| Metric | Q2 2024 | Management's Guidance | Q2 2023 | % Change YoY |
|---|---|---|---|---|
| Revenue | $153.1 million | $167.5 million (Avg) | $146.8 million | 4.3% |
| Operating Expenses | $146 million | N/A | $163 million | -10.4% |
| Net Loss | $37.9 million | N/A | $62.4 million | NA |
| Source: Expectations based on management's guidance, as provided in 2024-04-30 earnings report. |
Understanding 10x Genomics
10x Genomics platforms like Chromium, Visium, and Xenium aid in single-cell and spatial genomic research.
Recently, 10x Genomics rolled out new products like the Xenium Prime 5K for cell and tissue analysis. It aims to drive success through consistent technological advancements and by capturing a larger share of the global life sciences research tools market.
Quarterly Highlights
10x Genomics Q2 revenue was driven largely by the Americas and Europe, Middle East and Africa (EMEA) regions. However, the growth was below management's expectations.
Operating expense declined to $146 million due to lower personnel and laboratory costs. Consequently, the company's net loss narrowed significantly.
Product portfolio performance was mixed. While the company launched innovations like Xenium Prime 5K, instrument sales declined. Chromium instrument revenue fell to $8.8 million from $12.9 million, and Spatial instrument revenue dropped to $15.1 million from $18.1 million year-over-year. This decline underscores the challenges faced in maintaining sales growth for these products.
Despite the reductions in specific areas, overall revenue for consumables rose more than 150%, increasing from $11.7 million to $29.3 million. This reflects a shift in demand from instruments to consumables, driven by recent product launches.
Additionally, 10x Genomics saw notable market penetration in regions like the Americas, which recorded $93.1 million in revenue. EMEA also showed growth with $37.4 million in Q2 compared to $31.2 million a year ago. Asia-Pacific regions underperformed, as revenue fell from $24.0 million to $22.7 million.
Looking Ahead
10x Genomics now expects full-year revenue of between $640 million and $660 million, lower than its previous estimate of $670 million to $690 million, reflecting the reduced growth rate of Q2.
Investors should look for continued product innovation and market penetration efforts in the quarters ahead. Significant emphasis will be placed on how the company manages and capitalizes on new product launches like Xenium Prime 5K and Chromium GEM-X. Monitoring R&D investments will also be key in understanding the company's potential.
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