PacBio has reported a 72% increase in revenue for Q3 2023, reaching $55.7 million, attributed to strong sales of its Revio systems and consumables. The company increased its full-year revenue guidance for 2023 to between $195 million and $200 million, representing a growth rate of 52% to 56% over 2022. However, PacBio anticipates that global macroeconomic challenges may impact its growth trajectory in 2024.
Key takeaways from the earnings call include:
- PacBio shipped 52 Revio instruments in Q3, taking the total installed base to 129 systems. The company also shipped its first Onso units and received orders from 10 countries.
- Over 40% of Revio system orders in Q3 were from new customers, indicating potential for more Sequel II customers to migrate to Revio.
- PacBio is expanding into multi-omics and launching Kinect kits for scalable RNA sequencing and 16S microbial sequencing.
- The company is consolidating its San Diego manufacturing operations into Menlo Park to improve efficiency.
- PacBio expects to ship more systems in 2023 than ever before, achieve record consumable revenue, and exceed its compound annual growth target of 40% to 50%.
During the earnings call, PacBio highlighted the capabilities of its Revio system, capable of generating data on multiple omes (genome, methylome, chromatin epigenome, and transcriptome) from a single Revio SMRT cell. The company also announced the launch of Kinect kits, which enable scalable and cost-effective full-length RNA sequencing on the Revio and Sequel IIe systems.
In terms of financials, PacBio reported a significant increase of 203% in instrument revenue due to the momentum of Revio. The company expects revenue for the full year to be $195 million to $200 million, with a growth rate of approximately 52% to 56% compared to 2022. However, the company anticipates that the current global macroeconomic challenges may impact its growth trajectory in 2024.
PacBio is also developing new sequencing platforms to reach a wider market. The sales funnel for the Onso system is strong, but manufacturing scaling is a rate limiter. Revio consumables are expected to continue growing, with utilization rates at around 37% and potential for increased pull-through in the future. Less than 30% of Sequel II/IIe customers have ordered a Revio, but PacBio expects orders to increase every quarter through 2023 and into 2024.
CEO Christian Henry acknowledged the challenging macro environment and potential elongated sales cycles, particularly in academia and smaller biotech companies. However, he expressed confidence in the company's performance and outlook, highlighting the potential for more leasing options and the impact of long-read sequencing in the next five years. He also mentioned that consumable revenue will continue to grow, and the company is focused on driving consumable pull-through and introducing new applications to increase system utilization.
The company concluded the call with plans to update stakeholders in 2024.
InvestingPro Insights
Based on data from InvestingPro, PacBio has a market cap of $1830M and a P/E ratio of -5.21, indicating that the company is not currently profitable. Over the last twelve months as of Q2 2023, the company reported a revenue of $146.14M, representing a growth of 4.72%. However, the company's operating income was in the negative, at -$299.32M, suggesting that it is quickly burning through cash.
From the InvestingPro Tips, it is notable that the company's stock price movements are quite volatile, and it is currently trading near its 52-week low. The stock's RSI suggests that it is in oversold territory. Despite this, two analysts have revised their earnings upwards for the upcoming period, indicating some optimism about the company's future performance.
In total, InvestingPro provides 11 additional tips related to PacBio, which can be accessed through their platform. These insights can help investors make informed decisions about the company's potential and the factors that may influence its stock price.
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