San Diego’s Illumina Inc. reported quarterly earnings May 3, falling short of analyst expectations and further slipping the company’s stock.
A weak earnings forecast driven by disappointing sales in Europe hammered shares of Illumina last month when the company’s stock fell over 20 percent in one day.
The firm, which makes DNA sequencing machines, reported first quarter revenues grew 6 percent over the first quarter of the previous year, but fell short of analysts’ expectations. Illumina reported its Q1 revenues to be around $572 million, while analysts, on average, had expected revenues of $596.3 million.
Net income was $90 million in the first quarter, compared with $137 million in the same period last year. The difference was in part due to increased R&D expenses, which went from $92 million in Q1 2015 to $124 million in the first quarter of 2016.
"As we have previously shared, Q1 was a slower start to the year than we expected,” said Jay Flatley, chairman and CEO of Illumina in a statement. “Our view of the growth potential of the sequencing market remains unchanged, as the largest opportunities are in their earliest stages of development. In the near-term, we are focused on improving execution to restore the growth rate we believe our markets can support.”
Further compounding the firm's troubles this month, a court in the U.K. said it would postpone separate NIPT (non-invasive prenatal testing) patent infringement lawsuits Illumina has filed against various companies there. The lawsuits will proceed concurrently but will not see the inside of a courtroom until 2017.
Illumina’s stock is down 2 percent in afterhours trading May 3. The firm’s stock, trading on Nasdaq under stock symbol ILMN, has fallen nearly 25 percent since the earnings forecast was first announced last month.