News

Illumina Inc. Lowers Sales and Profit Outlook

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Andrew R. Michaud

• November 09, 2023

Shares of Illumina Inc. (ILMN) experienced a decline after the company, known for its DNA-sequencing technology, reduced its full-year sales and profit outlook. Illumina now anticipates a 2% to 3% drop in full-year sales, compared to the previously projected 1% growth forecasted in August. Additionally, the adjusted per-share profit is expected to range from 60 to 70 cents, lower than the initial estimate of 75 cents to 90 cents per share.

Weakening Third Quarter Results

For the third quarter, Illumina reported adjusted earnings per share of 33 cents, with revenue reaching $1.12 billion. This revenue remained unchanged when compared to the same period last year. Analysts polled by FactSet had predicted adjusted earnings per share of 13 cents, with revenue totaling $1.13 billion.

Market Reaction

Shares of Illumina tumbled by 8.9% after the news was announced in after-hours trading. The company's new CEO, Jacob Thaysen, acknowledged the challenging economic environment in which Illumina is currently operating.

Divesting GRAIL amid Regulatory Pressures

Following orders from both U.S. regulators and the European Union, Illumina is required to divest its cancer-detection test maker, GRAIL, which it had acquired in 2021. This decision was made due to concerns over competition. In response, Illumina's management has engaged advisors to explore options for a sale and capital markets transaction for GRAIL.

In conclusion, Illumina Inc. faces challenges ahead with a reduction in sales and profit expectations, along with the requirement to divest GRAIL. The market has reacted negatively to this news, resulting in a notable decline in the company's stock value during after-hours trading.