PacBio announces Q4 and fiscal year 2023 financial results

PacBio announced financial results for the quarter and fiscal year ended December 31, 2023.

Fourth quarter results

• Revenue of $58.4 million, a 113% increase compared with $27.4 million in the prior-year period.
• Instrument revenue of $35.1 million compared with $6.1 million in the prior-year period.
• Consumables revenue of $18.9 million compared with $16.7 million in the prior-year period.
• Service and other revenue of $4.4 million compared with $4.6 million in the prior-year period.
• Shipped 44 Revio^TM sequencing systems in the fourth quarter of 2023, bringing the installed base as of December 31, 2023, to 173 systems.

Gross profit for the fourth quarter of 2023 was $9.6 million, representing an 86% increase compared with $5.1 million for the fourth quarter of 2022 and a gross margin of 16% in the fourth quarter of 2023 compared to 19% for the fourth quarter of 2022. Non-GAAP gross profit for the fourth quarter of 2023 was $11.1 million and represented a non-GAAP gross margin of 19% in the fourth quarter of 2023, compared to a non-GAAP gross profit of $5.3 million in the fourth quarter of 2022, which represented a non-GAAP gross margin of 19% (see accompanying tables for reconciliations of GAAP and non-GAAP measures).

Operating expenses totaled $97.1 million for the fourth quarter of 2023, compared to $92.2 million for the fourth quarter of 2022. Non-GAAP operating expenses totaled $88.4 million for the fourth quarter of 2023, compared to $87.6 million for the fourth quarter of 2022. Operating expenses for the fourth quarter of 2023 and the fourth quarter of 2022 included non-cash share-based compensation of $15.4 million and $16.8 million, respectively.

Net loss for the fourth quarter of 2023 was $82.0 million, compared to a net loss of $84.4 million for the fourth quarter of 2022. Non-GAAP net loss was $72.5 million for the fourth quarter of 2023, compared to $79.6 million for the fourth quarter of 2022.

Net loss per share for the fourth quarter of 2023 was $0.31 compared to net loss per share of $0.37 for the fourth quarter of 2022. Non-GAAP net loss per share for the fourth quarter of 2023 was $0.27 compared to $0.35 for the fourth quarter of 2022.

GAAP and non-GAAP gross profit, gross margin, net loss and net loss per share for the fourth quarter of 2023 reflect charges related to inventory reserves and loss on purchase commitments totaling approximately $9.3 million compared to $7.1 million in the fourth quarter of 2022, primarily related to a higher-than-anticipated decline in demand for Sequel II and IIe due to a faster-than-expected ramp in Revio.

Cash, cash equivalents, and investments, excluding restricted cash, at December 31, 2023, totaled $631.4 million, compared to $772.3 million at December 31, 2022.

Fiscal year 2023 results

• Revenue of $200.5 million, a 56% increase compared with $128.3 million in the prior-year period.
• Instrument revenue of $120.5 million compared with $48.7 million> in the prior-year period.
• Consumables revenue of $63.4 million compared with $60.0 million in the prior-year period.
• Service and other revenue of $16.6 million compared with $19.6 million in the prior-year period.

Gross profit for 2023 was $52.8 million, representing an 8% increase compared with $49.0 million for 2022 and a gross margin of 26% in 2023 compared to 38% for 2022. Non-GAAP gross profit for 2023 was $54.9 million and represented a non-GAAP gross margin of 27% in 2023, compared to a non-GAAP gross profit of $49.8 million in 2022, which represented a non-GAAP gross margin of 39% (see accompanying tables for reconciliations of GAAP and non-GAAP measures).

Operating expenses totaled $387.2 million for 2023, compared to $356.2 million for 2022. Non-GAAP operating expenses totaled $354.8 million for 2023, compared to $353.7 million for 2022. Operating expenses for 2023 and 2022 included non-cash share-based compensation of $66.7 million and $73.8 million, respectively.

Net loss for 2023 was $306.7 million, compared to a net loss of $314.2 million for 2022. Non-GAAP net loss was $281.6 million for 2023, compared to $311.0 million for 2022.

Net loss per share for 2023 was $1.21 compared to net loss per share of $1.40 for 2022. Non-GAAP net loss per share for 2023 was $1.11 compared to $1.38 for 2022.

GAAP and non-GAAP gross profit, gross margin, net loss and net loss per share for 2023 reflect charges related to inventory reserves and loss on purchase commitments totaling approximately $14.0 million compared to $9.7 million in 2022, primarily related to a higher-than-anticipated decline in demand for Sequel II and IIe due to a faster-than-expected ramp in Revio.

Updates since PacBio’s last earnings release

• Announced the creation of the HiFi Solves consortium, which brings together researchers from 15 leading genomics research institutions across 10 countries to study the value that HiFi-based human genome sequencing may have in clinical research applications and to further our understanding of genetic diseases.
• Released SMRT Link 13.0 software on the Revio system which includes the adaptive loading feature for consistent run performance, run preview for improved lab efficiency, and expanded application support with functionality to sequence shorter and longer fragments of DNA.
• Commenced shipment of Kinnex RNA kits, enabling scalable, cost-effective, full-length RNA sequencing on PacBio Revio and Sequel IIe.
• Announced PanDNA, a versatile Nanobind DNA extraction kit, designed to efficiently extract high-quality, high molecular weight DNA across a wide range of sample types, including cells, bacteria, blood, tissue, plant nuclei, and insects.
• Developed two new high throughput library preparation kits and workflows – HiFi Prep Kit 96 and HiFi Plex Prep Kit 96 – offering customers automated, scalable, and high-performance library preparation solutions and the potential for an up to 40 percent reduction in costs and up to 60 percent decrease in workflow time.
• Added two tertiary analysis partners to PacBio Compatible – Geneyx and Golden Helix – further enabling customers to leverage PacBio HiFi data for disease research.

“Our team successfully executed its goals in 2023 and launched PacBio on a trajectory this company has never seen before,” said Christian Henry, President and CEO of PacBio. “We continue to build solutions across the workflow, allowing our customers to further scale on HiFi, and we are encouraged to see how researchers are already making discoveries and shifting paradigms with the power and economics of Revio and the extraordinary accuracy of Onso.”
MB Bureau