Illumina, Inc. · NASDAQ:ILMN
Illumina — Q1 2024 Earnings Presentation
35 slides from Illumina's earnings presentation, May 2, 2024
Slide 1: Q1 2024 Earnings Presentation
Q1 2024 Earnings Presentation May 2, 2024 © 2024 Illumina, Inc. All rights reserved.
Slide 2: Presenters: Thaysen, Dhingra, Schwartz
Jacob Thaysen Ankur Dhingra Salli Schwartz Chief Executive Officer Chief Financial Officer Head of Investor Relations 2
Slide 3: Cautionary Notes on Forward Looking Statements
Cautionary Notes on Forward Looking Statements This release may contain forward-looking statements that involve risks and uncertainties. Among the important factors to which our business is subject that could cause actual results to differ materially from those in any forward-looking statements are:
Slide 4: Jacob Thaysen, Chief Executive Officer
Jacob Thaysen Chief Executive Officer 4
Slide 5: Q1'24 Financial Results
Q1’24 Financial Results CORE ILLUMINA REVENUE Delivered revenue ahead of our expectations We remain cautious due to persistently challenging global ~$1.06B macroeconomic environment Customers are still constrained in their purchasing decisions Expected lower instrument placements in Q1’24 vs.
Slide 6: Core Illumina Q1 2024 Regional Revenue
Core Illumina Q1 2024 Regional Revenue $583M $279M (4%) YoY 55% 26% +7% YoY; +5% CC $1.06B Q1’24 Core Illumina Revenue $78M $116M (14%) YoY; (13%) CC 11% (3%) YoY; +1% CC 7% Americas Europe AMEA Greater China Note: See Appendix for reconciliations of these GAAP and non-GAAP financial measures. Note:
Slide 7: My Priorities as CEO
My Priorities as CEO 1 Drive Our Top Line 2 Deliver Operational Excellence 3 Resolve GRAIL as Quickly as Possible 7
Slide 8: Drive Our Top Line
Drive Our Top Line Growing NovaSeq X installed base Pursuing partnerships and alliances to drive the genomics ecosystem forward 55 400+ Pillar Biosciences Q1’24 NovaSeq X Total NovaSeq X Instrument Shipments Installed Base Now offering a full suite of NovaSeq X Announced FDA approval for pan-cancer
Slide 9: Deliver Operational Excellence
Deliver Operational Excellence Combined Marketing and Commercial teams under one Global Commercial organization Build agility to better serve customers Will deliver sustained growth and margins over time Driving further improvements through our supply chain and improving our cost structure Imp
Slide 10: Resolve GRAIL as Quickly as Possible
Resolve GRAIL as Quickly as Possible European Commission approved our divestment plan for GRAIL Approved plan contemplates parallel paths – In the event of a capital markets transaction, we will we have made progress on both capitalize GRAIL with 2.5 years of funding ~$1B Third-party Sale Capital Ma
Slide 11: Ankur Dhingra, Chief Financial Officer
Ankur Dhingra Chief Financial Officer 11
Slide 12: Core Illumina Q1 2024 Financials
Core Illumina Q1 2024 Financials CORE ILLUMINA REVENUE SEQUENCING CONSUMABLES REVENUE (2%) $698M +1% $1.06B YoY Revenue YoY Revenue (2%) Sequentially, NovaSeq X consumables grew in the double digits following the successful launch of the 25B flow cell YoY Revenue (CC) Exceeded our expectations prima
Slide 13: Core Illumina Q1 2024 Financials (cont'd.)
Core Illumina Q1 2024 Financials (cont’d.) SEQUENCING INSTRUMENTS REVENUE NOVASEQ X SHIPMENTS $110M (29%) YoY Revenue 55 Q1’24 NovaSeq X Shipments Driven by: SEQUENCING SERVICE & OTHER $151M Expected decline in mid-throughput shipments, as capital and cashflow constraints continue to impact purcha
Slide 14: Core Illumina Q1 2024 Additional P&L Results
Core Illumina Q1 2024 Additional P&L Results NON-GAAP GROSS MARGIN NON-GAAP OPERATING EXPENSES 67.1% $491M 190 bps YoY $23M YoY Primarily driven by a more favorable mix of sequencing consumables and Primarily due to decreased labor expense as a result of reduced headcount, execution of our opera
Slide 15: GRAIL Q1 2024 Financial Results
GRAIL Q1 2024 Financial Results REVENUE NON-GAAP OPERATING EXPENSES $27M $197M 35% YoY $24M YoY Primarily driven by Primarily driven by increased headcount to support adoption of Galleri® commercial expansion and R&D Note: See Appendix for reconciliations of these GAAP and non-GAAP financial measure
Slide 16: Consolidated Q1 2024 Financials
Consolidated Q1 2024 Financials CONSOLIDATED ILLUMINA REVENUE TAX RATE2 (1%) $1.08B YoY Decline (1%) 46.4% Q1’24 Non-GAAP Tax Rate YoY Decline (CC) NON-GAAP NON-GAAP NON-GAAP WEIGHTED AVERAGE NET INCOME1 DILUTED EPS1 DILUTED SHARES $14M $0.09 ~159 Million Note: See Appendix for reconciliations of th
Slide 17: Cash Flow & Balance Sheet Items Q1 2024
Cash Flow & Balance Sheet Items Q1 2024 CASH FLOW FROM OPERATIONS FREE CASH FLOW $77M $41M CAPITAL EXPENDITURES CASH, CASH EQUIVALENTS AND SHORT- TERM INVESTMENTS $36M ~$1.12B Note: See Appendix for reconciliations of these GAAP and non-GAAP financial measures. 17
Slide 18: Guidance for Full Year 2024
Guidance for Full Year 2024 As of 05/02/2024 CORE ILLUMINA Seeing the seasonal rebuild of our total performance obligations, or backlog, which REVENUE1 increased more than 20% from the end of Q4 ~Flat No significant improvement in the macroeconomic environment or our business in China Monitori
Slide 19: Guidance for Second Quarter 2024
Guidance for Second Quarter 2024 As of 05/02/2024 CORE ILLUMINA REVENUE1 Year-over-year decline driven predominantly by lower NovaSeq X instrument shipments $1.072B – $1.084B given the significant backlog we worked through in 2023 following the launch Midpoint reflects a $22 million sequential i
Slide 20: Jacob Thaysen, Chief Executive Officer
Jacob Thaysen Chief Executive Officer 20
Slide 21: Strategy Update
Strategy Update Illumina’s leadership team is Our strategy will continue to play to our re-examining our strengths Strategy Building the genomics ecosystem Roadmap & Initiatives Maintaining tight customer focus Profitable Growth We will share our comprehensive strategy work during a virtual event in
Slide 22: Slide 22
Slide 23: Q&A
Q&A Jacob Thaysen Ankur Dhingra Joydeep Goswami 23
Slide 24: Our Mission: To improve human health by unlocking the power of the genome
Our Mission: To improve human health by unlocking the power of the genome
Slide 25: Appendix
Appendix © 2024 Illumina, Inc. All rights reserved.
Slide 26: Statement regarding use of non-GAAP financial measures
Statement regarding use of non-GAAP financial measures The company reports non-GAAP results for diluted earnings per share, net income, gross margin, operating expenses, including research and development expense, selling general and administrative expense, and from time to time, as applicable, lega
Slide 27: Forward-looking statements (continued)
assumptions, estimates, and judgments and (xxii) legislative, regulatory and economic developments, together with other factors detailed in our filings with the Securities and Exchange Commission, including our most recent filings on Forms 10-K and 10-Q, or in information disclosed in public confere
Slide 28: Condensed Consolidated Statements of Cash Flows
Illumina, Inc. Condensed Consolidated Statements of Cash Flows (In millions) (unaudited) Three Months Ended March 31, April 2, 2024 2023 Net cash provided by operating activities $ 77 $ 10 Net cash used in investing activities (48) (56) Net cash provided by (used in) financing activities 35 (473) Ef
Slide 29: Results of Operations - Revenue by Segment
Illumina, Inc. Results of Operations - Revenue by Segment (Dollars in millions) (unaudited) Three Months Ended March 31, April 2, % Change 2024 2023 Consolidated revenue $ 1,076 $ 1,087 (1)% Less: Hedge gains 3 2 Consolidated revenue, excluding hedge effect 1,073 1,085 Less: Exchange rate effect (1)
Slide 30: Results of Operations - Revenue by Region
Illumina, Inc. Results of Operations - Revenue by Region (Dollars in millions) (unaudited) Three Months Ended March 31, April 2, % Change 2024 2023 AMR revenue - Core Illumina $ 583 $ 605 (4)% Less: Hedge gains — — AMR revenue - Core Illumina, excluding hedge effect 583 605 Less: Exchange rate effec
Slide 31: Results of Operations - Non-GAAP
Illumina, Inc. Results of Operations - Non-GAAP (In millions, except per share amounts) (unaudited) TABLE 1: CONSOLIDATED RECONCILIATION BETWEEN GAAP AND NON-GAAP DILUTED (LOSS) EARNINGS PER SHARE: Three Months Ended March 31, April 2, 2024 2023 GAAP (loss) earnings per share - diluted $ (0.79) $ 0.
Slide 32: Results of Operations - Non-GAAP (continued)
Illumina, Inc. Results of Operations - Non-GAAP (continued) (Dollars in millions) (unaudited) TABLE 3: ITEMIZED RECONCILIATION BETWEEN GAAP AND NON-GAAP RESULTS OF OPERATIONS AS A PERCENT OF REVENUE: Three Months Ended March 31, 2024 Core Illumina GRAIL Eliminations Consolidated GAAP gross profit (l
Slide 33: Results of Operations - Non-GAAP (continued)
Illumina, Inc. Results of Operations - Non-GAAP (continued) (Dollars in millions) (unaudited) TABLE 3 (CONTINUED): ITEMIZED RECONCILIATION BETWEEN GAAP AND NON-GAAP RESULTS OF OPERATIONS AS A PERCENT OF REVENUE: Three Months Ended April 2, 2023 Core Illumina GRAIL Eliminations Consolidated GAAP gros
Slide 34: Footnotes to non-GAAP reconciliations
(f) Amounts consist of fair value adjustments related to our Helix contingent value right. (g) Amounts for Q1 2024 consist primarily of lease and other asset impairments related to restructuring activities. Amounts for Q1 2023 consist primarily of employee severance costs related to restructuring ac
Slide 35: Results of Operations - Non-GAAP (continued)
Illumina, Inc. Results of Operations - Non-GAAP (continued) (Dollars in millions) (unaudited) TABLE 4: CONSOLIDATED ITEMIZED RECONCILIATION BETWEEN GAAP AND NON-GAAP TAX PROVISION (BENEFIT): Three Months Ended March 31, 2024 GAAP tax provision $ 17 (15.3)% Incremental non-GAAP tax expense (b) 13 GIL