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PacBio (PACB) Q2 Earnings Beat Estimates, Revenues Down Y/Y
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Pacific Biosciences of California, Inc. (PACB - Free Report) , popularly known as PacBio, delivered an adjusted loss per share of 20 cents in second-quarter 2024, narrower than the year-ago quarter’s loss of 26 cents per share. The adjusted loss per share beat the Zacks Consensus Estimate by 16.7%.
The company’s GAAP loss per share was 64 cents in the quarter, wider than the year-ago period’s loss of 28 cents.
Revenues in Detail
PacBio registered revenues of $36 million in the second quarter, down 24.3% year over year. The figure missed the Zacks Consensus Estimate by 11.2%.
Geographical Analysis
PacBio’s revenues from the Americas were $20.8 million, down 13% year over year. This was primarily due to a decline in Revio shipments.
In the Asia-Pacific region, PacBio recorded revenues of $8.2 million, reflecting a decline of 36% year over year. Europe, the Middle East and Africa (EMEA) region registered revenues of $7 million, which decreased 35% year over year.
Segmental Analysis
Product revenues amounted to $31.7 million, down 27.3% from the year-ago quarter.
PacBio shipped 24 Revio sequencing systems in the second quarter, which brought the company’s installed base to 225 Revio systems as of Jun 30, 2024.
Instrument revenues were $14.7 million, down 51% year over year. This decrease was due to lower Revio unit shipments.
Consumables revenues for the second quarter of 2024 were $17 million, up 24% from the prior-year quarter.
Service and other revenues totaled $4.3 million, up 9% year over year.
Margin Trend
In the quarter under review, PacBio’s adjusted gross profit decreased 15.9% to $13.2 million. However, the adjusted gross margin expanded 400 basis points to 37% year over year.
Sales, general and administrative expenses rose 13.1% to $45.9 million. Research and development expenses declined 16.7% year over year to $38.5 million. Adjusted total operating expenses of $71 million declined 18.1% year over year.
Total operating loss was $175.8 million in the reported quarter, wider than the prior-year quarter’s $73.2 million.
Financial Position
PacBio exited second-quarter 2024 with cash, cash equivalents and investments (excluding short-term and long-term restricted cash) of $509.8 million compared with $561.9 million at the first quarter of 2024-end.
Guidance
PacBio updated its revenue outlook for 2024.
The company expects to achieve revenues around the lower end of the $170-$200 million range. The Zacks Consensus Estimate is pegged at $177.5 million.
Management also expects $80 million of instrument revenues for fiscal 2024, including 115 Revio shipments. Consumable revenues are expected to be $72 million.
Our Take
PacBio exited the second quarter of 2024 with mixed results, where earnings beat the Zacks Consensus Estimate, and revenues missed the same.
PACB saw an uptick in Service and other revenues, as well as Consumables revenues. However, geographically, revenues declined in the Americas, Asia-Pacific region and EMEA, which seems concerning. A decrease in adjusted gross profit does not bode well for the stock. However, continued strong prospects in the Revio system, with customers placing orders for these, looked promising for the stock.
In July 2024, PacBio announced that Novogene, a Chinese company providing genomics services and solutions, is set to use PacBio’s Revio long-read sequencing system to expand the capabilities of its new lab in Munich, Germany.
In the same month, PacBio and Form Bio, a provider of advanced computational life sciences technology, collaborated and announced a range of new initiatives intended toward advancing and unifying the Adeno-associated virus industry.
In March 2024, PacBio announced the PureTarget repeat expansion panel, a new approach that makes it possible to thoroughly examine 20 genes linked to severe neurological conditions, including difficult-to-sequence genes with tandem repeat expansions, is now possible.
Yet, the continued loss per share reported by PacBio was disappointing. The year-over-year decline in Product and Instrument revenues was concerning. The year-over-year adjusted operating loss was another area of concern. The continued inflationary pressures and high interest rates also raise apprehension.
Pacific Biosciences of California, Inc. Price, Consensus and EPS Surprise
Some better-ranked stocks in the broader medical space that have announced quarterly results are Boston Scientific Corporation (BSX - Free Report) , Hologic (HOLX - Free Report) and Universal Health Services (UHS - Free Report) .
Boston Scientific reported second-quarter 2024 adjusted EPS of 62 cents, which beat the Zacks Consensus Estimate by 6.9%. Revenues of $4.12 billion surpassed the Zacks Consensus Estimate by 2.5%. It currently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Boston Scientific has a long-term growth rate of 12.5%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.18%.
Hologic, carrying a Zacks Rank of 2 at present, has a long-term growth rate of 7.4%. Its earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 4.50%.
Hologic reported second-quarter 2024 adjusted EPS of $1.06, which beat the Zacks Consensus Estimate by 3.9%. Revenues of $1 billion surpassed the Zacks Consensus Estimate by 1.1%.
Universal Health Services reported second-quarter 2024 adjusted EPS of $4.31, which beat the Zacks Consensus Estimate by 27.9%. Revenues of $3.9 billion surpassed the Zacks Consensus Estimate by 1.5%. It currently sports a Zacks Rank of 1.
Universal Health Services has a long-term growth rate of 18%. UHS’ earnings surpassed estimates in each of the trailing four quarters, the average surprise being 14.58%.
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PacBio (PACB) Q2 Earnings Beat Estimates, Revenues Down Y/Y
Pacific Biosciences of California, Inc. (PACB - Free Report) , popularly known as PacBio, delivered an adjusted loss per share of 20 cents in second-quarter 2024, narrower than the year-ago quarter’s loss of 26 cents per share. The adjusted loss per share beat the Zacks Consensus Estimate by 16.7%.
The company’s GAAP loss per share was 64 cents in the quarter, wider than the year-ago period’s loss of 28 cents.
Revenues in Detail
PacBio registered revenues of $36 million in the second quarter, down 24.3% year over year. The figure missed the Zacks Consensus Estimate by 11.2%.
Geographical Analysis
PacBio’s revenues from the Americas were $20.8 million, down 13% year over year. This was primarily due to a decline in Revio shipments.
In the Asia-Pacific region, PacBio recorded revenues of $8.2 million, reflecting a decline of 36% year over year. Europe, the Middle East and Africa (EMEA) region registered revenues of $7 million, which decreased 35% year over year.
Segmental Analysis
Product revenues amounted to $31.7 million, down 27.3% from the year-ago quarter.
PacBio shipped 24 Revio sequencing systems in the second quarter, which brought the company’s installed base to 225 Revio systems as of Jun 30, 2024.
Instrument revenues were $14.7 million, down 51% year over year. This decrease was due to lower Revio unit shipments.
Consumables revenues for the second quarter of 2024 were $17 million, up 24% from the prior-year quarter.
Service and other revenues totaled $4.3 million, up 9% year over year.
Margin Trend
In the quarter under review, PacBio’s adjusted gross profit decreased 15.9% to $13.2 million. However, the adjusted gross margin expanded 400 basis points to 37% year over year.
Sales, general and administrative expenses rose 13.1% to $45.9 million. Research and development expenses declined 16.7% year over year to $38.5 million. Adjusted total operating expenses of $71 million declined 18.1% year over year.
Total operating loss was $175.8 million in the reported quarter, wider than the prior-year quarter’s $73.2 million.
Financial Position
PacBio exited second-quarter 2024 with cash, cash equivalents and investments (excluding short-term and long-term restricted cash) of $509.8 million compared with $561.9 million at the first quarter of 2024-end.
Guidance
PacBio updated its revenue outlook for 2024.
The company expects to achieve revenues around the lower end of the $170-$200 million range. The Zacks Consensus Estimate is pegged at $177.5 million.
Management also expects $80 million of instrument revenues for fiscal 2024, including 115 Revio shipments. Consumable revenues are expected to be $72 million.
Our Take
PacBio exited the second quarter of 2024 with mixed results, where earnings beat the Zacks Consensus Estimate, and revenues missed the same.
PACB saw an uptick in Service and other revenues, as well as Consumables revenues. However, geographically, revenues declined in the Americas, Asia-Pacific region and EMEA, which seems concerning. A decrease in adjusted gross profit does not bode well for the stock. However, continued strong prospects in the Revio system, with customers placing orders for these, looked promising for the stock.
In July 2024, PacBio announced that Novogene, a Chinese company providing genomics services and solutions, is set to use PacBio’s Revio long-read sequencing system to expand the capabilities of its new lab in Munich, Germany.
In the same month, PacBio and Form Bio, a provider of advanced computational life sciences technology, collaborated and announced a range of new initiatives intended toward advancing and unifying the Adeno-associated virus industry.
In March 2024, PacBio announced the PureTarget repeat expansion panel, a new approach that makes it possible to thoroughly examine 20 genes linked to severe neurological conditions, including difficult-to-sequence genes with tandem repeat expansions, is now possible.
Yet, the continued loss per share reported by PacBio was disappointing. The year-over-year decline in Product and Instrument revenues was concerning. The year-over-year adjusted operating loss was another area of concern. The continued inflationary pressures and high interest rates also raise apprehension.
Pacific Biosciences of California, Inc. Price, Consensus and EPS Surprise
Pacific Biosciences of California, Inc. price-consensus-eps-surprise-chart | Pacific Biosciences of California, Inc. Quote
Zacks Rank and Key Picks
PacBio currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Boston Scientific Corporation (BSX - Free Report) , Hologic (HOLX - Free Report) and Universal Health Services (UHS - Free Report) .
Boston Scientific reported second-quarter 2024 adjusted EPS of 62 cents, which beat the Zacks Consensus Estimate by 6.9%. Revenues of $4.12 billion surpassed the Zacks Consensus Estimate by 2.5%. It currently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Boston Scientific has a long-term growth rate of 12.5%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.18%.
Hologic, carrying a Zacks Rank of 2 at present, has a long-term growth rate of 7.4%. Its earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 4.50%.
Hologic reported second-quarter 2024 adjusted EPS of $1.06, which beat the Zacks Consensus Estimate by 3.9%. Revenues of $1 billion surpassed the Zacks Consensus Estimate by 1.1%.
Universal Health Services reported second-quarter 2024 adjusted EPS of $4.31, which beat the Zacks Consensus Estimate by 27.9%. Revenues of $3.9 billion surpassed the Zacks Consensus Estimate by 1.5%. It currently sports a Zacks Rank of 1.
Universal Health Services has a long-term growth rate of 18%. UHS’ earnings surpassed estimates in each of the trailing four quarters, the average surprise being 14.58%.