SAN
DIEGO, Jan. 9, 2024 /PRNewswire/ -- Illumina,
Inc. (Nasdaq: ILMN) ("Illumina" or the "company") today announced
unaudited preliminary financial results for the fourth quarter and
fiscal year 2023 ahead of its presentation at the 42nd Annual J.P.
Morgan Healthcare Conference on January 9,
2024 at 9:00am Pacific Time
(12:00pm Eastern Time). The webcast
can be accessed through the Investor Info section of Illumina's
website at investor.illumina.com.
Preliminary financial results
- Consolidated revenue of approximately $1,115 million for Q4 2023, up 3% from Q4 2022,
and approximately $4,497 million for
fiscal year 2023, down 2% from fiscal year 2022
- Core Illumina revenue of approximately $1,090 million for Q4 2023, up 2% from Q4 2022,
and approximately $4,431 million for
fiscal year 2023, down 3% from fiscal year 2022
- Shipped 79 NovaSeq X instruments in Q4 2023 and 352 instruments
for fiscal year 2023
- Consolidated GAAP operating margin of approximately (15.5%) for
Q4 2023 and approximately (24.0%) for fiscal year 2023
- Consolidated non-GAAP operating margin of approximately 3.8%
for Q4 2023 and approximately 5.3% for fiscal year 2023
- Core Illumina GAAP operating margin of approximately 2.4% for
Q4 2023 and approximately 12.3% for fiscal year 2023
- Core Illumina non-GAAP operating margin of approximately 18.0%
for Q4 2023 and approximately 19.8% for fiscal year 2023
As previously announced, the company expects to report its full
fourth quarter and fiscal year 2023 results following the close of
market on Thursday, February 8, 2024.
The unaudited results in this press release are preliminary and
subject to the completion of accounting and annual audit procedures
and are therefore subject to adjustment.
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, legal
contingencies and settlement, and goodwill and intangible
impairment, operating income (loss), operating margin, gross profit
(loss), other income (expense), tax provision, constant currency
revenue growth, and free cash flow (on a consolidated and, as
applicable, segment basis for our Core Illumina and GRAIL segments)
in addition to, and not as a substitute for, or superior to,
financial measures calculated in accordance with GAAP. The
company's financial measures under GAAP include substantial charges
such as amortization of acquired intangible assets among others
that are listed in the itemized reconciliations between GAAP and
non-GAAP financial measures included in this press release, as well
as the effects of currency translation. Management has excluded the
effects of these items in non-GAAP measures to assist investors in
analyzing and assessing past and future operating performance,
including in the non-GAAP measures related to our Core Illumina and
GRAIL segments. Additionally, non-GAAP net income and diluted
earnings per share are key components of the financial metrics
utilized by the company's board of directors to measure, in part,
management's performance and determine significant elements of
management's compensation.
The company 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. Reconciliations between GAAP
and non-GAAP results are presented in the tables of this
release.
Use of 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: (i)
the finalization of the accounting and audit procedures necessary
to report our financial results for the fourth quarter and fiscal
year 2023; (ii) changes in the rate of growth in the markets we
serve; (iii) the volume, timing and mix of customer orders among
our products and services; (iv) our ability to adjust our operating
expenses to align with our revenue expectations; (v) our ability to
manufacture robust instrumentation and consumables; (vi) the
success of products and services competitive with our own; (vii)
challenges inherent in developing, manufacturing, and launching new
products and services, including expanding or modifying
manufacturing operations and reliance on third-party suppliers for
critical components; (viii) the impact of recently launched or
pre-announced products and services on existing products and
services; (ix) our ability to modify our business strategies to
accomplish our desired operational goals; (x) our ability to
realize the anticipated benefits from prior or future actions to
streamline and improve our R&D processes, reduce our operating
expenses and maximize our revenue growth; (xi) our ability to
further develop and commercialize our instruments, consumables, and
products; (xii) to deploy new products, services, and applications,
and to expand the markets for our technology platforms; (xiii) the
risks and costs associated with our ongoing inability to integrate
GRAIL due to the transitional measures imposed on us by the
European Commission as a result of their prohibition of our
acquisition of GRAIL and orders issued by the European Commission
and the Federal Trade Commission requiring that we divest GRAIL;
(xiv) the risks and costs associated with the expected divestment
of GRAIL, including the possibility that the terms on which we
divest all or a portion of the assets or equity interests of GRAIL
are materially worse than those on which we acquired GRAIL; (xv)
the risk that disruptions from the consummation of our acquisition
of GRAIL and associated legal or regulatory proceedings, including
appeals, or obligations will harm our business, including current
plans and operations; (xvi) the risk of incurring additional fines
associated with the consummation of our acquisition of GRAIL;
(xvii) our ability to obtain approval by third-party payors to
reimburse patients for our products; (xviii) our ability to obtain
regulatory clearance for our products from government agencies;
(xix) our ability to successfully partner with other companies and
organizations to develop new products, expand markets, and grow our
business; (xx) uncertainty, or adverse economic and business
conditions, including as a result of slowing or uncertain economic
growth or armed conflict; (xxi) the application of generally
accepted accounting principles, which are highly complex and
involve many subjective 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 conference
calls, the date and time of which are released beforehand. We
undertake no obligation, and do not intend, to update these
forward-looking statements, to review or confirm analysts'
expectations, or to provide interim reports or updates on the
progress of the current quarter.
About Illumina
Illumina is improving human health by unlocking the power of the
genome. Our focus on innovation has established us as a global
leader in DNA sequencing and array-based technologies, serving
customers in the research, clinical, and applied markets. Our
products are used for applications in the life sciences, oncology,
reproductive health, agriculture, and other emerging segments. To
learn more, visit illumina.com and connect with us on X (Twitter),
Facebook, LinkedIn, Instagram, TikTok, and YouTube.
Illumina, Inc.
Preliminary Results
of Operations - Non-GAAP
(unaudited)
Our performance and financial results are subject to risks and
uncertainties, and actual results could differ materially from the
preliminary results set forth below. Some of the factors that could
affect our financial results are included from time to time in the
public reports filed with the Securities and Exchange Commission
(SEC), including Form 10-K for the fiscal year ended January 1, 2023, filed with the SEC on
February 17, 2023, Form 10-Q for the
fiscal quarter ended April 2, 2023,
Form 10-Q for the fiscal quarter ended July
2, 2023, and Form 10-Q for the fiscal quarter ended
October 1, 2023. We assume no
obligation to update any forward-looking statements or
information.
The preliminary unaudited information included in the tables
below is approximate and subject to change. We will report our
fourth quarter and full year fiscal 2023 results in
February.
CONSOLIDATED
RECONCILIATION BETWEEN PRELIMINARY GAAP AND NON-GAAP OPERATING
MARGIN:
|
|
|
Fourth Quarter
2023
|
|
Fiscal Year
2023
|
Preliminary GAAP
operating margin
|
(15.5) %
|
|
(24.0) %
|
Amortization of
acquired intangible assets
|
4.4
|
|
4.3
|
Acquisition-related
expenses (b)
|
3.0
|
|
2.5
|
Restructuring
(d)
|
5.5
|
|
3.5
|
Contingent
consideration liabilities (e)
|
5.2
|
|
(0.5)
|
Proxy
contest
|
0.2
|
|
0.7
|
Goodwill and intangible
(IPR&D) impairment (c)
|
0.5
|
|
18.4
|
Legal contingency and
settlement (f)
|
0.5
|
|
0.4
|
Preliminary non-GAAP
operating margin (a)
|
3.8 %
|
|
5.3 %
|
CORE ILLUMINA
RECONCILIATION BETWEEN PRELIMINARY GAAP AND NON-GAAP OPERATING
MARGIN:
|
|
|
Fourth Quarter
2023
|
|
Fiscal Year
2023
|
Preliminary GAAP
operating margin - Core Illumina
|
2.4 %
|
|
12.3 %
|
Amortization of
acquired intangible assets
|
1.3
|
|
1.3
|
Acquisition-related
expenses (b)
|
2.3
|
|
2.0
|
Restructuring
(d)
|
5.5
|
|
3.5
|
Contingent
consideration liabilities (e)
|
5.3
|
|
(0.6)
|
Proxy
contest
|
0.2
|
|
0.7
|
Intangible (IPR&D)
impairment (c)
|
0.5
|
|
0.1
|
Legal contingency and
settlement (f)
|
0.5
|
|
0.5
|
Preliminary non-GAAP
operating margin - Core Illumina (a)
|
18.0 %
|
|
19.8 %
|
|
(a) Non-GAAP
operating margin excludes the effects of the pro forma adjustments
as detailed above. Management has excluded the effects of these
items in these measures to assist investors in analyzing and
assessing past and future operating performance, including in the
non-GAAP measure related to our Core Illumina segment.
|
(b) Amounts
consist primarily of legal expenses related to the acquisition of
GRAIL.
|
(c) Amounts for
Q4 2023 consist of an IPR&D intangible asset impairment related
to our Core Illumina segment. Amounts for FY 2023 also consist of
goodwill and IPR&D intangible asset impairments related to
GRAIL.
|
(d) Amounts for
Q4 2023 and FY 2023 consist primarily of lease and other asset
impairments and employee severance costs related to restructuring
activities.
|
(e) Amounts
consist of fair value adjustments for our contingent consideration
liability related to GRAIL.
|
(f) Amounts for
Q4 2023 consist primarily of interest for the accrued fine imposed
by the European Commission. Amounts for FY 2023 also consist of a
loss related to a patent litigation settlement in Q1 2023, an
adjustment recorded in Q2 2023 to our accrual for the fine imposed
by the European Commission in July 2023, and a gain related to a
patent litigation settlement in Q3 2023.
|
|
Investors:
Salli Schwartz
+1.858.291.6421
ir@illumina.com
Media:
David McAlpine
+1.347.327.1336
pr@illumina.com
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SOURCE Illumina, Inc.