Leading gene sequencing company Illumina reported non-GAAP diluted earnings per share of USD 0.08 in Q1 2023, beating analyst estimates by 3x. Its non-GAAP net income, however, declined 92.3% YoY to USD 13 million compared to Q1 2022. Revenue for the quarter declined 11% YoY to USD 1.09 billion, beating analyst estimates by 1.9%. 

Its non-GAAP gross margin shrank 520 bps YoY to 64.7% in Q1 2023. The company’s non-GAAP operating margin slipped considerably to 1.9% from 17.3% in Q1 2022, as R&D expenses increased 5.0% YoY. 

Illumina’s highlights for the quarter included launching Illumina Complete Long Read Prep, Human, which allows long-and-short-read sequencing on a single Illumina instrument for the first time, a partnership with Henry Ford Health to identify the impact of genomic testing in cardiovascular disease, exceeding 200 orders for the NovaSeq X, and expanding a partnership with Myriad Genetics to bring homologous recombination deficiency (HRD) testing to the US.

In terms of guidance for 2023, Illumina maintained its expected top-line growth of 7%–10% and GRAIL revenue of USD 90 million–110 million for the year.