Technology

Illumina Reports Financial Results for Second Quarter of Fiscal Year 2024

Published

2 years ago

August 6, 2024

Core Illumina revenue of $1.09 billion for Q2 2024, down 6% from Q2 2023 (down 6% on a constant currency basis) and up 3% from Q1 2024Core Illumina GAAP operating margin of 40.5% and non-GAAP operating margin of 22.2% for Q2 2024Core Illumina GAAP diluted earnings per share of $0.41 and non-GAAP diluted earnings per share of $1.09 for Q2 2024Lowered fiscal year 2024 Core Illumina revenue guidance to decline 2% to 3% (down 1.5% to 2.5% in constant currency) from 2023Raised Core Illumina non-GAAP operating margin guidance to a range of 20.5% to 21% for fiscal year 2024Introducing guidance for Core Illumina non-GAAP diluted earnings per share in the range of $3.80 to $3.95 for fiscal year 2024On June 24, 2024, we completed the spin-off of GRAIL into a new public company

SAN DIEGO, Aug. 6, 2024 /PRNewswire/ — Illumina, Inc. (Nasdaq: ILMN) (“Illumina” or the “company”) today announced its financial results for the second quarter of fiscal year 2024, which include the consolidated financial results for GRAIL through June 24, 2024.

“The Illumina team delivered results ahead of our expectations in the quarter, driven by disciplined execution on our strategic priorities,” said Jacob Thaysen, Chief Executive Officer. “Consumable sales remained solid as customers continued to increase their sequencing activity, but instrument demand has softened in a constrained funding environment. We are progressing our operating excellence initiatives and will deliver expanded margins this year.”

Second quarter consolidated results

GAAP

Non-GAAP (a)

Dollars in millions, except per share amounts

Q2 2024

Q2 2023

Q2 2024

Q2 2023

Revenue

$ 1,112

$ 1,176

$ 1,112

$ 1,176

Gross margin

64.8 %

62.2 %

69.0 %

66.5 %

Research and development (“R&D”) expense

$ 325

$ 358

$ 325

$ 345

Selling, general and administrative (“SG&A”) expense

$ 147

$ 462

$ 358

$ 355

Goodwill and intangible impairment (b)

$ 1,886

$ —

Operating (loss) profit

$ (1,637)

$ (88)

$ 84

$ 82

Operating margin

(147.2) %

(7.5) %

7.6 %

7.0 %

Tax provision

$ 12

$ 145

$ 16

$ 33

Tax rate

(0.6) %

(163.8) %

22.3 %

39.3 %

Net (loss) income

$ (1,988)

$ (234)

$ 57

$ 50

Diluted (loss) earnings per share

$ (12.48)

$ (1.48)

$ 0.36

$ 0.32

(a) See the tables included in the “Results of Operations – Non-GAAP” section below for reconciliations of these GAAP and non-GAAP financial measures.

(b) During the second quarter of 2024, the company recognized $1,466 million in goodwill and $420 million in intangible asset (IPR&D) impairment related to the GRAIL segment.

Capital expenditures for free cash flow purposes were $32 million for Q2 2024. Cash flow provided by operations was $80 million, compared to cash flow provided by operations of $105 million in the prior year period. Free cash flow (cash flow provided by operations less capital expenditures) was $48 million for the quarter, compared to $58 million in the prior year period. Depreciation and amortization expenses were $105 million for Q2 2024. At the close of the quarter, the company held $994 million in cash, cash equivalents and short-term investments.

Second quarter segment results
Illumina has two reportable segments, Core Illumina and GRAIL, which was spun-off on June 24, 2024.

Core Illumina

GAAP

Non-GAAP (a)

Dollars in millions

Q2 2024

Q2 2023

Q2 2024

Q2 2023

Revenue (b)

$ 1,092

$ 1,159

$ 1,092

$ 1,159

Gross margin (c)

68.0 %

65.5 %

69.4 %

67.0 %

R&D expense

$ 241

$ 274

$ 241

$ 261

SG&A expense

$ 60

$ 371

$ 275

$ 270

Operating profit

$ 442

$ 115

$ 242

$ 245

Operating margin

40.5 %

9.9 %

22.2 %

21.2 %

Tax provision

$ 35

$ 55

Tax rate

35.0 %

24.2 %

Net income

$ 66

$ 174

Diluted earnings per share

$ 0.41

$ 1.09

* Prior year information not provided.

(a) See the tables included in the “Results of Operations – Non-GAAP” section below for reconciliations of these GAAP and non-GAAP financial measures.

(b) Core Illumina revenue for Q2 2024 was down 6% as compared to Q2 2023 and down 6% on a constant currency basis. Amounts for Q2 2024 and Q2 2023 included intercompany revenue of $9 million and $5 million, respectively, which is eliminated in consolidation.

(c) The year-over-year increase in gross margin was primarily driven by a more favorable mix of sequencing consumables and execution of our operational excellence priorities that delivered cost savings, including freight and improved productivity.

GRAIL

GAAP

Non-GAAP (a)

In millions

Q2 2024

Q2 2023

Q2 2024

Q2 2023

Revenue

$ 29

$ 22

$ 29

$ 22

Gross (loss) profit

$ (16)

$ (24)

$ 15

$ 9

R&D expense

$ 88

$ 89

$ 88

$ 89

SG&A expense

$ 88

$ 91

$ 84

$ 85

Goodwill and intangible impairment

$ 1,886

$ —

Operating loss

$ (2,078)

$ (204)

$ (157)

$ (164)

(a) See Table 5 included in the “Results of Operations – Non-GAAP” section below for reconciliations of these GAAP and non-GAAP financial measures.

Key announcements by Illumina since Illumina’s last earnings release

Completed the spin-off of GRAILAcquired Fluent Biosciences, developer of an emerging and highly differentiated single-cell technologyAppointed Everett Cunningham as Chief Commercial OfficerAnnounced that Anna Richo, Corporate Senior Vice President, Strategic Advisor to the General Counsel and CEO at Cargill, Inc., joined Illumina’s Board of DirectorsPresented research at the American Society of Clinical Oncology (ASCO) Annual Meeting, with 14 total abstracts accepted to the meetingCompleted integration of Illumina’s latest chemistry, XLEAP-SBS™, into all reagents for its NextSeq™ 1000 and NextSeq 2000 next-generation sequencing instrumentsExpanded its oncology menu for NovaSeq™ X Series customers by offering the newly verified high-throughput version of TruSight™ Oncology 500 (TSO 500 HT), and the latest version of its distributed liquid biopsy research assay, TruSight Oncology 500 ctDNA v2 (TSO 500 ctDNA v2)Launched DRAGEN™ v4.3, the latest version of Illumina’s DRAGEN™ software, part of the Illumina Connected Software portfolio, for analysis of next-generation sequencing data

A full list of recent Illumina announcements can be found in the company’s News Center.

Financial outlook and guidance
For fiscal year 2024, the company lowered its Core Illumina revenue guidance to decline 2% to 3% (down 1.5% to 2.5% in constant currency) compared to fiscal year 2023 and raised its Core Illumina non-GAAP operating margin guidance to a range of 20.5% to 21%. The company is introducing guidance for Core Illumina non-GAAP diluted EPS in the range of $3.80 to $3.95 for fiscal year 2024.

The company provides forward-looking guidance on a non-GAAP basis. The company is unable to provide a reconciliation of forward-looking non-GAAP financial measures to the most directly comparable GAAP reported financial measures because it is unable to predict with reasonable certainty the financial impact of items such as acquisition-related expenses, gains and losses from our strategic investments, fair value adjustments related to contingent consideration and contingent value rights, potential future asset impairments, restructuring activities, and the ultimate outcome of pending litigation without unreasonable effort. These items are uncertain, inherently difficult to predict, depend on various factors, and could have a material impact on GAAP reported results for the guidance period. For the same reasons, the company is unable to address the significance of the unavailable information, which could be material to future results.

Conference call information
The conference call will begin at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time) on Tuesday, August 6, 2024. Interested parties may access the live teleconference through the Investor Info section of Illumina’s website at investor.illumina.com. Alternatively, individuals can access the call by dialing 866.400.0049 or +1.323.701.0231 outside North America, both using conference ID 9881025. To ensure timely connection, please dial in at least ten minutes before the scheduled start of the call.

A replay of the conference call will be posted on Illumina’s website after the event and will be available for at least 30 days following.

Statement regarding use of non-GAAP financial measures
The company reports non-GAAP results for diluted earnings per share, net income, gross margin, operating expenses, including research and development expense, selling general and administrative expense, and from time to time, as applicable, legal contingencies and settlement, and goodwill and intangible impairment, operating income (loss), operating margin, gross profit (loss), other income (expense), tax provision, constant currency revenue growth, and free cash flow (on a consolidated and, as applicable, segment basis) in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. The company’s financial measures under GAAP include substantial charges such as amortization of acquired intangible assets among others that are listed in the itemized reconciliations between GAAP and non-GAAP financial measures included in this press release, as well as the effects of currency translation. Management has excluded the effects of these items in non-GAAP measures to assist investors in analyzing and assessing past and future operating performance, including in the non-GAAP measures related to our segments. Additionally, non-GAAP net income, diluted earnings per share and operating margin are key components of the financial metrics utilized by the company’s board of directors to measure, in part, management’s performance and determine significant elements of management’s compensation.

The company encourages investors to carefully consider its results under GAAP, as well as its supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand its business. Reconciliations between GAAP and non-GAAP results are presented in the tables of this release.

Use of forward-looking statements
This release may contain forward-looking statements that involve risks and uncertainties. Among the important factors to which our business is subject that could cause actual results to differ materially from those in any forward-looking statements are: (i) changes in the rate of growth in the markets we serve; (ii) the volume, timing and mix of customer orders among our products and services; (iii) our ability to adjust our operating expenses to align with our revenue expectations; (iv) our ability to manufacture robust instrumentation and consumables; (v) the success of products and services competitive with our own; (vi) challenges inherent in developing, manufacturing, and launching new products and services, including expanding or modifying manufacturing operations and reliance on third-party suppliers for critical components; (vii) the impact of recently launched or pre-announced products and services on existing products and services; (viii) our ability to modify our business strategies to accomplish our desired operational goals; (ix) our ability to realize the anticipated benefits from prior or future actions to streamline and improve our R&D processes, reduce our operating expenses and maximize our revenue growth; (x) our ability to further develop and commercialize our instruments, consumables, and products; (xi) to deploy new products, services, and applications, and to expand the markets for our technology platforms; (xii) the risks and costs associated with the divestment of GRAIL; (xiii) the risk of additional litigation arising against us in connection with the GRAIL acquisition; (xiv) our ability to obtain approval by third-party payors to reimburse patients for our products; (xv) our ability to obtain regulatory clearance for our products from government agencies; (xvi) our ability to successfully partner with other companies and organizations to develop new products, expand markets, and grow our business; (xvii) uncertainty, or adverse economic and business conditions, including as a result of slowing or uncertain economic growth or armed conflict; (xviii) the application of generally accepted accounting principles, which are highly complex and involve many subjective assumptions, estimates, and judgments and (xix) legislative, regulatory and economic developments, together with other factors detailed in our filings with the Securities and Exchange Commission, including our most recent filings on Forms 10-K and 10-Q, or in information disclosed in public conference calls, the date and time of which are released beforehand. We undertake no obligation, and do not intend, to update these forward-looking statements, to review or confirm analysts’ expectations, or to provide interim reports or updates on the progress of the current quarter.

About Illumina
Illumina is improving human health by unlocking the power of the genome. Our focus on innovation has established us as a global leader in DNA sequencing and array-based technologies, serving customers in the research, clinical, and applied markets. Our products are used for applications in the life sciences, oncology, reproductive health, agriculture, and other emerging segments. To learn more, visit www.illumina.com and connect with us on X (Twitter), Facebook, LinkedIn, Instagram, TikTok, and YouTube.

About GRAIL
GRAIL is a healthcare company whose mission is to detect cancer early, when it can be cured. GRAIL is focused on alleviating the global burden of cancer by developing pioneering technology to detect and identify multiple deadly cancer types early. The company is using the power of next-generation sequencing, population-scale clinical studies, and state-of-the-art computer science and data science to enhance the scientific understanding of cancer biology, and to develop its multi-cancer early detection blood test. GRAIL is headquartered in Menlo Park, CA with locations in Washington, D.C., North Carolina, and the United Kingdom. GRAIL, Inc. was spun-out into a new public company on June 24, 2024. For more information, please visit www.grail.com.

Illumina, Inc.

Condensed Consolidated Balance Sheets

(In millions)

June 30,
2024

December 31,
2023

ASSETS

(unaudited)

Current assets:

Cash and cash equivalents

$ 920

$ 1,048

Short-term investments

Accounts receivable, net

641

734

Inventory, net

561

587

Prepaid expenses and other current assets

263

234

Total current assets

2,459

2,609

Property and equipment, net

859

1,007

Operating lease right-of-use assets

460

544

Goodwill

1,079

2,545

Intangible assets, net

278

2,993

Deferred tax assets, net

632

Other assets

314

357

Total assets

$ 6,081

$ 10,111

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable

$ 199

$ 245

Accrued liabilities

1,265

1,325

Term debt, current portion

744

—

Total current liabilities

2,208

1,570

Operating lease liabilities

616

687

Term debt

1,490

1,489

Other long-term liabilities

331

620

Stockholders’ equity

1,436

5,745

Total liabilities and stockholders’ equity

$ 6,081

$ 10,111

Illumina, Inc.

Condensed Consolidated Statements of Operations

(In millions, except per share amounts)

(unaudited)

Three Months Ended

Six Months Ended

June 30,
2024

July 2,
2023

June 30,
2024

July 2,
2023

Revenue:

Product revenue

$ 927

$ 1,001

$ 1,803

$ 1,923

Service and other revenue

185

175

385

340

Total revenue

1,112

1,176

2,188

2,263

Cost of revenue:

Cost of product revenue (a)

250

305

504

591

Cost of service and other revenue (a)

202

190

Amortization of acquired intangible assets

Total cost of revenue

391

444

800

877

Gross profit

721

732

1,388

1,386

Operating expense:

Research and development (a)

325

358

660

699

Selling, general and administrative (a)

147

462

588

839

Goodwill and intangible impairment

1,886

—

1,889

—

Total operating expense

2,358

820

3,137

1,538

Loss from operations

(1,637)

(88)

(1,749)

(152)

Other expense, net

(339)

(1)

(337)

(15)

Loss before income taxes

(1,976)

(89)

(2,086)

(167)

Provision for income taxes

145

Net loss

$ (1,988)

$ (234)

$ (2,114)

$ (231)

Loss per share:

Basic

$ (12.48)

$ (1.48)

$ (13.28)

$ (1.46)

Diluted

$ (12.48)

$ (1.48)

$ (13.28)

$ (1.46)

Shares used in computing loss per share:

Basic

159

158

159

158

Diluted

159

158

159

158

(a) Includes stock-based compensation expense for stock-based awards:

Three Months Ended

Six Months Ended

June 30,
2024

July 2,
2023

June 30,
2024

July 2,
2023

Cost of product revenue

$ 7

$ 8

$ 13

$ 15

Cost of service and other revenue

Research and development

Selling, general and administrative

109

Stock-based compensation expense before taxes

$ 110

$ 105

$ 208

$ 199

Illumina, Inc.

Condensed Consolidated Statements of Cash Flows

(In millions)

(unaudited)

Three Months Ended

Six Months Ended

June 30,
2024

July 2,
2023

June 30,
2024

July 2,
2023

Net cash provided by operating activities

$ 80

$ 105

$ 157

$ 115

Net cash used in investing activities

(41)

(37)

(89)

(93)

Net cash used in financing activities

(225)

(3)

(191)

(476)

Effect of exchange rate changes on cash and cash equivalents

(2)

(6)

(5)

(4)

Net (decrease) increase in cash and cash equivalents

(188)

(128)

(458)

Cash and cash equivalents, beginning of period

1,108

1,494

1,048

2,011

Cash and cash equivalents, end of period

$ 920

$ 1,553

$ 920

$ 1,553

Calculation of free cash flow:

Net cash provided by operating activities

$ 80

$ 105

$ 157

$ 115

Purchases of property and equipment

(32)

(47)

(67)

(99)

Free cash flow (a)

$ 48

$ 58

$ 90

$ 16

(a) Free cash flow, which is a non-GAAP financial measure, is calculated as net cash provided by operating activities reduced by purchases of property and equipment. Free cash flow is useful to management as it is one of the metrics used to evaluate our performance and to compare us with other companies in our industry. However, our calculation of free cash flow may not be comparable to similar measures used by other companies.

Illumina, Inc.

Results of Operations – Revenue by Segment

(Dollars in millions)

(unaudited)

Three Months Ended

Six Months Ended

June 30,
2024

July 2,
2023

% Change

June 30,
2024

July 2,
2023

% Change

Consolidated revenue

$ 1,112

$ 1,176

(5) %

$ 2,188

$ 2,263

(3) %

Less: Hedge gains

Consolidated revenue, excluding hedge effect

1,108

1,174

2,181

2,260

Less: Exchange rate effect

(5)

—

(7)

—

Consolidated constant currency revenue (a)

$ 1,113

$ 1,174

(5) %

$ 2,188

$ 2,260

(3) %

Core Illumina revenue

$ 1,092

$ 1,159

(6) %

$ 2,148

$ 2,235

(4) %

Less: Hedge gains

Core Illumina revenue, excluding hedge effect

1,088

1,157

2,141

2,232

Less: Exchange rate effect

(5)

—

(7)

—

Core Illumina constant currency revenue (a)

$ 1,093

$ 1,157

(6) %

$ 2,148

$ 2,232

(4) %

(a) Constant currency revenue growth, which is a non-GAAP financial measure, is calculated using comparative prior period foreign exchange rates to translate current period revenue, net of the effects of hedges.

Illumina, Inc.
Results of Operations – Non-GAAP
(In millions, except per share amounts)
(unaudited)

TABLE 1: CONSOLIDATED RECONCILIATION BETWEEN GAAP AND NON-GAAP DILUTED (LOSS) EARNINGS PER SHARE:

Three Months Ended

Six Months Ended

June 30,
2024

July 2,
2023

June 30,
2024

July 2,
2023

GAAP loss per share – diluted

$ (12.48)

$ (1.48)

$ (13.28)

$ (1.46)

Cost of revenue (b)

0.29

0.32

0.60

0.63

R&D expense (b)

—

0.08

0.01

0.09

SG&A expense (b)

(1.33)

0.68

(0.75)

0.89

Goodwill and intangible impairment (b)

11.84

—

11.86

—

Other expense, net (b)

2.06

0.01

2.01

0.08

GILTI, U.S. foreign tax credits, and global minimum top-up tax (c)

0.62

0.44

0.73

0.16

Incremental non-GAAP tax expense (d)

(0.65)

0.27

(0.74)

(0.04)

Income tax provision (e)

0.01

—

0.01

0.05

Non-GAAP earnings per share – diluted (a)

$ 0.36

$ 0.32

$ 0.45

$ 0.40

TABLE 2: CONSOLIDATED RECONCILIATION BETWEEN GAAP AND NON-GAAP NET (LOSS) INCOME:

Three Months Ended

Six Months Ended

June 30,
2024

July 2,
2023

June 30,
2024

July 2,
2023

GAAP net loss

$ (1,988)

$ (234)

$ (2,114)

$ (231)

Cost of revenue (b)

R&D expense (b)

—

SG&A expense (b)

(211)

107

(120)

142

Goodwill and intangible impairment (b)

1,886

—

1,889

—

Other expense, net (b)

328

319

GILTI, U.S. foreign tax credits, and global minimum top-up tax (c)

116

Incremental non-GAAP tax expense (d)

(104)

(117)

(6)

Income tax provision (e)

—

Non-GAAP net income (a)

$ 57

$ 50

$ 71

$ 64

Illumina, Inc.
Results of Operations – Non-GAAP (continued)
(In millions, except per share amounts)
(unaudited)

TABLE 3: CORE ILLUMINA RECONCILIATION BETWEEN GAAP AND NON-GAAP DILUTED EARNINGS PER SHARE:

Three Months Ended

Six Months Ended

June 30,
2024

GAAP earnings per share – diluted

$ 0.41

$ 0.85

Cost of revenue (b)

0.10

0.19

R&D expense (b)

—

0.01

SG&A expense (b)

(1.35)

(0.84)

Goodwill and intangible impairment (b)

—

0.02

Other expense, net (b)

2.06

2.01

GILTI, U.S. foreign tax credits, and global minimum top-up tax (c)

0.12

0.21

Incremental non-GAAP tax expense (d)

(0.26)

(0.39)

Income tax provision (e)

0.01

Non-GAAP earnings per share – diluted (a)

$ 1.09

$ 2.07

TABLE 4: CORE ILLUMINA RECONCILIATION BETWEEN GAAP AND NON-GAAP NET INCOME:

Three Months Ended

Six Months Ended

June 30,
2024

GAAP net income

$ 66

$ 135

Cost of revenue (b)

R&D expense (b)

—

SG&A expense (b)

(215)

(132)

Goodwill and intangible impairment (b)

—

Other expense, net (b)

328

319

GILTI, U.S. foreign tax credits, and global minimum top-up tax (c)

Incremental non-GAAP tax expense (d)

(41)

(62)

Income tax provision (e)

Non-GAAP net income (a)

$ 174

$ 329

All amounts in tables are rounded to the nearest millions, except as otherwise noted. As a result, certain amounts may not recalculate using the rounded amounts provided.

(a) Non-GAAP net income and diluted earnings per share exclude the effects of the pro forma adjustments as detailed above. Non-GAAP net income and diluted earnings per share are key components of the financial metrics utilized by the company’s board of directors to measure, in part, management’s performance and determine significant elements of management’s compensation. Management has excluded the effects of these items in these measures to assist investors in analyzing and assessing our past and future operating performance.

(b) Refer to the Itemized Reconciliations between GAAP and Non-GAAP Results of Operations for the components of these amounts.

(c) Amounts represent the impact of GRAIL pre-acquisition net operating losses on GILTI, the utilization of U.S. foreign tax credits, and the Pillar Two global minimum top-up tax, which became effective in Q1 2024.

(d) Incremental non-GAAP tax expense reflects the tax impact of the non-GAAP adjustments listed.

(e) Amounts represent the difference between book and tax accounting related to stock-based compensation cost.

Illumina, Inc.
Results of Operations – Non-GAAP (continued)
(Dollars in millions)
(unaudited)

TABLE 5: ITEMIZED RECONCILIATION BETWEEN GAAP AND NON-GAAP RESULTS OF OPERATIONS AS A PERCENT OF REVENUE:

Three Months Ended

June 30, 2024

Core Illumina

GRAIL

Eliminations

Consolidated

GAAP gross profit (loss) (b)

$ 743

68.0 %

$ (16)

$ (6)

$ 721

64.8 %

Amortization of acquired intangible assets

1.4 %

—

4.2 %

Non-GAAP gross profit (a)

$ 758

69.4 %

$ 15

$ (6)

$ 767

69.0 %

GAAP and Non-GAAP R&D expense

$ 241

22.1 %

$ 88

$ (4)

$ 325

29.2 %

GAAP SG&A expense

$ 60

5.5 %

$ 88

$ (1)

$ 147

13.2 %

Amortization of acquired intangible assets

—

(1)

—

(1)

(0.1) %

Contingent consideration liabilities (c)

271

24.8 %

—

271

24.4 %

Acquisition-related expenses (d)

(46)

(4.2) %

(3)

—

(49)

(4.4) %

Restructuring (g)

(3)

(0.3) %

—

(3)

(0.3) %

Accrued interest on EC fine (h)

(7)

(0.6) %

—

(7)

(0.6) %

Non-GAAP SG&A expense

$ 275

25.2 %

$ 84

$ (1)

$ 358

32.2 %

GAAP goodwill and intangible impairment

$ —

—

$ 1,886

$ —

$ 1,886

169.6 %

Goodwill impairment (i)

—

(1,466)

—

(1,466)

(131.8) %

Intangible (IPR&D) impairment (i)

—

(420)

—

(420)

(37.8) %

Non-GAAP goodwill and intangible impairment

$ —

—

$ —

—

GAAP operating profit (loss)

$ 442

40.5 %

$ (2,078)

$ (1)

$ (1,637)

(147.2) %

Cost of revenue

1.4 %

—

4.2 %

SG&A costs

(215)

(19.7) %

—

(211)

(19.0) %

Goodwill and intangible impairment

—

1,886

—

1,886

169.6 %

Non-GAAP operating profit (loss) (a)

$ 242

22.2 %

$ (157)

$ (1)

$ 84

7.6 %

GAAP other (expense) income, net

$ (341)

(31.2) %

$ 2

$ —

$ (339)

(30.5) %

Strategic investment related loss, net (e)

334

30.5 %

—

334

30.0 %

Gain on Helix contingent value right (f)

(8)

(0.7) %

—

(8)

(0.7) %

Foreign currency loss on EC fine (j)

0.2 %

—

0.2 %

Non-GAAP other (expense) income, net (a)

$ (13)

(1.2) %

$ 2

$ —

$ (11)

(1.0) %

Illumina, Inc.
Results of Operations – Non-GAAP (continued)
(Dollars in millions)
(unaudited)

TABLE 5 (CONTINUED): ITEMIZED RECONCILIATION BETWEEN GAAP AND NON-GAAP RESULTS OF OPERATIONS AS A PERCENT OF REVENUE:

Three Months Ended

July 2, 2023

Core Illumina

GRAIL

Eliminations

Consolidated

GAAP gross profit (loss) (b)

$ 760

65.5 %

$ (24)

$ (4)

$ 732

62.2 %

Amortization of acquired intangible assets

1.2 %

—

4.0 %

Restructuring (g)

0.3 %

—

0.3 %

Non-GAAP gross profit (a)

$ 777

67.0 %

$ 9

$ (4)

$ 782

66.5 %

GAAP R&D expense

$ 274

23.6 %

$ 89

$ (5)

$ 358

30.4 %

Acquisition-related expenses (d)

(1)

(0.1) %

—

(1)

(0.1) %

Restructuring (g)

(12)

(1.0) %

—

(12)

(1.0) %

Non-GAAP R&D expense

$ 261

22.5 %

$ 89

$ (5)

$ 345

29.3 %

GAAP SG&A expense

$ 371

31.9 %

$ 91

$ —

$ 462

39.3 %

Amortization of acquired intangible assets

—

(1)

—

(1)

(0.1) %

Contingent consideration liabilities (c)

(29)

(2.5) %

—

(29)

(2.5) %

Acquisition-related expenses (d)

(18)

(1.4) %

(3)

—

(21)

(1.8) %

Restructuring (g)

(17)

(1.5) %

(2)

—

(19)

(1.6) %

Legal contingency and settlement (k)

(12)

(1.0) %

—

(12)

(1.0) %

Proxy contest

(25)

(2.2) %

—

(25)

(2.1) %

Non-GAAP SG&A expense

$ 270

23.3 %

$ 85

$ —

$ 355

30.2 %

GAAP operating profit (loss)

$ 115

9.9 %

$ (204)

$ 1

$ (88)

(7.5) %

Cost of revenue

1.5 %

—

4.3 %

R&D costs

1.1 %

—

1.1 %

SG&A costs

100

8.7 %

—

107

9.1 %

Non-GAAP operating profit (loss) (a)

$ 245

21.2 %

$ (164)

$ 1

$ 82

7.0 %

GAAP other (expense) income, net

$ (3)

(0.3) %

$ 2

$ —

$ (1)

(0.1) %

Strategic investment related loss, net (e)

0.2 %

—

0.2 %

Non-GAAP other (expense) income, net (a)

$ (1)

(0.1) %

$ 2

$ —

$ 1

0.1 %

Illumina, Inc.
Results of Operations – Non-GAAP (continued)
(Dollars in millions)
(unaudited)

TABLE 5 (CONTINUED): ITEMIZED RECONCILIATION BETWEEN GAAP AND NON-GAAP RESULTS OF OPERATIONS AS A PERCENT OF REVENUE:

Six Months Ended

June 30, 2024

Core Illumina

GRAIL

Eliminations

Consolidated

GAAP gross profit (loss) (b)

$ 1,436

66.9 %

$ (38)

$ (10)

$ 1,388

63.5 %

Amortization of acquired intangible assets

1.4 %

—

4.3 %

Non-GAAP gross profit (a)

$ 1,466

68.3 %

$ 27

$ (10)

$ 1,483

67.8 %

GAAP R&D expense

$ 479

22.3 %

$ 189

$ (8)

$ 660

30.2 %

Restructuring (g)

(2)

(0.1) %

—

(2)

(0.1) %

Non-GAAP R&D expense

$ 477

22.2 %

$ 189

$ (8)

$ 658

30.1 %

GAAP SG&A expense

$ 396

18.5 %

$ 192

$ —

$ 588

26.9 %

Amortization of acquired intangible assets

—

(2)

—

(2)

(0.1) %

Contingent consideration liabilities (c)

255

11.9 %

—

255

11.7 %

Acquisition-related expenses (d)

(70)

(3.3) %

(11)

—

(81)

(3.7) %

Restructuring (g)

(38)

(1.8) %

(1)

—

(39)

(1.8) %

Accrued interest on EC fine (h)

(14)

(0.7) %

—

(14)

(0.7) %

Non-GAAP SG&A expense

$ 529

24.6 %

$ 178

$ —

$ 707

32.3 %

GAAP goodwill and intangible impairment

$ 3

0.1 %

$ 1,886

$ —

$ 1,889

86.3 %

Goodwill impairment (i)

—

(1,466)

—

(1,466)

(67.0) %

Intangible (IPR&D) impairment (i)

(3)

(0.1) %

(420)

—

(423)

(19.3) %

Non-GAAP goodwill and intangible impairment

$ —

—

$ —

—

GAAP operating profit (loss)

$ 558

26.0 %

$ (2,305)

$ (2)

$ (1,749)

(79.9) %

Cost of revenue

1.4 %

—

4.3 %

R&D costs

0.1 %

—

0.1 %

SG&A costs

(133)

(6.2) %

—

(120)

(5.4) %

Goodwill and intangible impairment

0.1 %

1,886

—

1,889

86.3 %

Non-GAAP operating profit (loss) (a)

$ 460

21.4 %

$ (341)

$ (2)

$ 117

5.4 %

GAAP other (expense) income, net

$ (342)

(15.9) %

$ 5

$ —

$ (337)

(15.4) %

Strategic investment related loss, net (e)

327

15.2 %

—

327

15.0 %

Gain on Helix contingent value right (f)

(11)

(0.5) %

—

(11)

(0.5) %

Foreign currency loss on EC fine (j)

0.1 %

—

0.1 %

Non-GAAP other (expense) income, net (a)

$ (23)

(1.1) %

$ 5

$ —

$ (18)

(0.8) %

Illumina, Inc.
Results of Operations – Non-GAAP (continued)
(Dollars in millions)
(unaudited)

TABLE 5 (CONTINUED): ITEMIZED RECONCILIATION BETWEEN GAAP AND NON-GAAP RESULTS OF OPERATIONS AS A PERCENT OF REVENUE:

Six Months Ended

July 2, 2023

Core Illumina

GRAIL

Eliminations

Consolidated

GAAP gross profit (loss) (b)

$ 1,446

64.7 %

$ (50)

$ (10)

$ 1,386

61.3 %

Amortization of acquired intangible assets

1.3 %

—

4.2 %

Restructuring (g)

0.1 %

—

0.1 %

Non-GAAP gross profit (a)

$ 1,478

66.1 %

$ 17

$ (10)

$ 1,485

65.6 %

GAAP R&D expense

$ 532

23.7 %

$ 175

$ (8)

$ 699

30.9 %

Acquisition-related expenses (d)

(1)

—

(1)

—

Restructuring (g)

(13)

(0.5) %

—

(13)

(0.6) %

Non-GAAP R&D expense

$ 518

23.2 %

$ 175

$ (8)

$ 685

30.3 %

GAAP SG&A expense

$ 656

29.4 %

$ 184

$ (1)

$ 839

37.1 %

Amortization of acquired intangible assets

—

(2)

—

(2)

(0.1) %

Contingent consideration liabilities (c)

(28)

(1.3) %

—

(28)

(1.2) %

Acquisition-related expenses (d)

(38)

(1.7) %

(9)

—

(47)

(2.1) %

Restructuring (g)

(17)

(0.7) %

(2)

—

(19)

(0.8) %

Legal contingency and settlement (k)

(15)

(0.7) %

—

(15)

(0.7) %

Proxy contest

(31)

(1.4) %

—

(31)

(1.4) %

Non-GAAP SG&A expense

$ 527

23.6 %

$ 171

$ (1)

$ 697

30.8 %

GAAP operating profit (loss)

$ 257

11.5 %

$ (408)

$ (1)

$ (152)

(6.7) %

Cost of revenue

1.4 %

—

4.3 %

R&D costs

0.6 %

—

0.6 %

SG&A costs

129

5.8 %

—

142

6.3 %

Non-GAAP operating profit (loss) (a)

$ 432

19.3 %

$ (328)

$ (1)

$ 103

4.5 %

GAAP other (expense) income, net

$ (19)

(0.9) %

$ 4

$ —

$ (15)

(0.7) %

Strategic investment related loss, net (e)

0.7 %

—

0.7 %

Gain on Helix contingent value right (f)

(3)

(0.1) %

—

(3)

(0.1) %

Non-GAAP other (expense) income, net (a)

$ (6)

(0.3) %

$ 4

$ —

$ (2)

(0.1) %

All amounts in tables are rounded to the nearest millions, except as otherwise noted. As a result, certain amounts may not recalculate using the rounded amounts provided. Percentages of revenue are calculated based on the revenue of the respective segment.

(a) Non-GAAP gross profit, included within non-GAAP operating profit (loss), is a key measure of the effectiveness and efficiency of manufacturing processes, product mix and the average selling prices of our products and services. Non-GAAP operating profit (loss) and non-GAAP other (expense) income, net exclude the effects of the pro forma adjustments as detailed above. Non-GAAP operating margin is a key component of the financial metrics utilized by the company’s board of directors to measure, in part, management’s performance and determine significant elements of management’s compensation. Management has excluded the effects of these items in these measures to assist investors in analyzing and assessing past and future operating performance, including in the non-GAAP measures related to our segments.

(b) Reconciling amounts are recorded in cost of revenue.

(d) Amounts consist primarily of legal and other expenses related to the acquisition and divestiture of GRAIL.

(e) Amounts consist primarily of mark-to-market adjustments and impairments from our strategic investments. Amounts for Q2 2024 and YTD 2024 primarily relate to the impairment on our retained investment in GRAIL post spin-off.

(f) Amounts consist of fair value adjustments related to our Helix contingent value right.

(g) Amount for Q2 2024 consists primarily of employee severance costs. Amount for YTD 2024 consists primarily of lease and other asset impairments. Amounts for Q2 2023 and YTD 2023 consist primarily of employee severance costs and lease and other asset impairments.

(h) Amounts for Q2 2024 and YTD 2024 consist of accrued interest on the fine imposed by the European Commission.

(i) Amounts for Q2 2024 and YTD 2024 consist of goodwill and IPR&D intangible asset impairments related to GRAIL. Amount for YTD 2024 also consists of an IPR&D intangible asset impairment related to Core Illumina in Q1 2024.

(j) Amounts for Q2 2024 and YTD 2024 consist of unrealized gains/losses related to foreign currency balance sheet remeasurement of the EC fine liability and unrealized/realized mark-to-market gains/losses on the hedge associated with the EC fine.

(k) Amount for Q2 2023 consists of an adjustment to our accrual for the fine imposed by the European Commission. Amount for YTD 2023 also consists of a loss related to a patent litigation settlement in Q1 2023.

Illumina, Inc.
Results of Operations – Non-GAAP (continued)
(Dollars in millions)
(unaudited)

TABLE 6: CONSOLIDATED ITEMIZED RECONCILIATION BETWEEN GAAP AND NON-GAAP TAX PROVISION:

Three Months Ended

Six Months Ended

June 30,
2024

GAAP tax provision

$ 12

(0.6) %

$ 28

(1.4) %

Incremental non-GAAP tax expense (b)

104

117

Income tax provision (c)

(1)

GILTI, U.S. foreign tax credits, and global minimum top-up tax (d)

(99)

(116)

Non-GAAP tax provision (a)

$ 16

22.3 %

$ 28

28.8 %

Three Months Ended

Six Months Ended

July 2,
2023

GAAP tax provision

$ 145

(163.8) %

$ 64

(38.5) %

Incremental non-GAAP tax expense (b)

(43)

Income tax provision (c)

—

(8)

GILTI and U.S. foreign tax credits (d)

(69)

(25)

Non-GAAP tax provision (a)

$ 33

39.3 %

$ 37

37.2 %

TABLE 7: CORE ILLUMINA ITEMIZED RECONCILIATION BETWEEN GAAP AND NON-GAAP TAX PROVISION:

Three Months Ended

Six Months Ended

June 30,
2024

GAAP tax provision

$ 35

35.0 %

$ 80

37.3 %

Incremental non-GAAP tax expense (b)

Income tax provision (c)

(1)

GILTI, U.S. foreign tax credits, and global minimum top-up tax (d)

(20)

(33)

Non-GAAP tax provision (a)

$ 55

24.2 %

$ 108

24.9 %

(a) Non-GAAP tax provision excludes the effects of the pro forma adjustments as detailed above. Management has excluded the effects of these items in this measure to assist investors in analyzing and assessing past and future operating performance.

(b) Incremental non-GAAP tax expense reflects the tax impact of the non-GAAP adjustments listed in Table 2 and 4.

(d) Amounts represent the impact of GRAIL pre-acquisition net operating losses on GILTI, the utilization of U.S. foreign tax credits, and the Pillar Two global minimum top-up tax, which became effective in Q1 2024.

Investors:
Salli Schwartz
+1.858.291.6421
ir@illumina.com

Media:
Bonny Fowler
+1.740.641.5579
pr@illumina.com

View original content:https://www.prnewswire.com/news-releases/illumina-reports-financial-results-for-second-quarter-of-fiscal-year-2024-302215890.html

SOURCE Illumina, Inc.

Technology

Meridian Singapore Immigration Launches New Website to Simplify the PR Application Journey for Foreigners in Singapore

Published

3 hours ago

April 30, 2026

New online platform provides clear, structured guidance for Employment Pass and S Pass holders navigating Singapore’s residency and Permanent Residency pathways

SINGAPORE, April 30, 2026 /PRNewswire/ — Meridian Singapore Immigration Pte. Ltd. has officially launched its new website at meridianimmigration.sg, a resource built specifically for foreigners living and working in Singapore who are exploring Permanent Residency or long-term residency options.

The platform arrives at a time when Singapore’s expatriate and foreign professional community is growing rapidly, yet many EP and S Pass holders report struggling to find clear, reliable information on the PR application process. Singapore’s immigration framework is among the most structured in Southeast Asia, with eligibility criteria, documentation requirements, and submission windows that change frequently. For individuals navigating this process without professional guidance, the stakes are high and the margin for error is narrow.

Meridian’s website was built to address that gap directly. The platform offers detailed explanations of available immigration pathways, structured consultation options, and educational resources developed by the firm’s team of immigration specialists. Rather than presenting a services catalogue, the site walks users through the considerations relevant to their specific situation, whether they hold an Employment Pass, S Pass, or are planning for their family’s long-term residency in Singapore.

“We built this platform because we saw how overwhelming and confusing the immigration process can be for people who genuinely want to build their lives here,” said a spokesperson for Meridian Singapore Immigration. “Our goal is to be the trusted partner that walks them through every step with clarity and integrity.”

Singapore’s continued attractiveness as a regional hub for multinational corporations, financial institutions, and technology firms means the pipeline of foreigners seeking long-term residency options remains substantial. At the same time, the ICA’s PR application framework has grown more nuanced, with factors such as economic contributions, family ties, and community integration weighed during assessment. Applicants who proceed without a clear understanding of these criteria often submit applications that are either premature or structurally incomplete.

Meridian’s approach centres on preparation and transparency, helping applicants understand where they stand before they apply and what supporting documentation strengthens their case.

Meridian Singapore Immigration Pte. Ltd. is a professional immigration consultancy dedicated to guiding individuals and families through Singapore’s immigration process. Specialising in Permanent Residency (PR) applications, residency pathways, and compliance support, Meridian offers clear, structured solutions tailored to each client’s unique circumstances. Founded on the values of Guidance, Integrity, and Success, Meridian is committed to making immigration simple, transparent, and accessible for everyone. For more information, visit meridianimmigration.sg or contact info@meridianimmigration.sg / +65 8873 1113.

View original content:https://www.prnewswire.com/apac/news-releases/meridian-singapore-immigration-launches-new-website-to-simplify-the-pr-application-journey-for-foreigners-in-singapore-302757392.html

SOURCE Meridian Singapore Immigration Pte. Ltd.

Technology

Socomec, Daitron team up to meet Japan’s growing power demands

Published

3 hours ago

April 30, 2026

TOKYO, April 30, 2026 /PRNewswire/ — Socomec, a century-old electrical group specialising in mission-critical energy, and Japan’s Daitron, an electronics components distributor, have signed a partnership to deliver power conversion solutions and service backup power and electrical-switching systems across Japan.

The deal combines Socomec’s equipment with Daitron’s on-the-ground engineering team, which has more than 74 years of experience in the Japanese market. The two companies will handle everything from project delivery to ongoing maintenance and spare parts.

The partnership covers three product areas: uninterruptible power supplies (UPS), which keep facilities running during outages; power conversion systems, which ensure the availability and continuity of high-quality energy; and static transfer switches, which automatically reroute power loads between sources without interruption.

Beyond equipment sales, the agreement includes training, spare parts, long-term service contracts and a full range of expert services covering prevention, measurement and analysis, consultancy, deployment and optimisation. Socomec will provide product and technical training to Daitron’s team, while Daitron handles installation, servicing and day-to-day client support in Japan.

The target market spans data centres, semiconductor plants, industrial facilities, hospitals and green buildings, all areas where even brief power interruptions can prove costly. Data center demand in particular is surging, driven by the rapid expansion of artificial intelligence infrastructure, with colocation and enterprise facilities among the primary targets.

“Daitron knows the Japanese market inside and out. They have the people, the relationships, and the hands-on experience, and we bring the technology to match,” said Socomec Asia-Pacific CEO O’Niel Dissanayake. “It’s a natural fit, and together we can offer something neither company could deliver alone.”

“Japan’s data centres, chip factories and industrial plants all require power systems they can count on,” said Masaharu Kato, corporate officer of Daitron. “Socomec’s technology is exactly what these customers need, and our job is to make sure it’s installed, maintained and supported properly. That’s what we do best.”

The partnership comes as Japan faces a step change in power demand. Electricity consumption is expected to grow 5.3% over the next decade, driven by data centres and semiconductor factories, according to the country’s grid operator. Industrial energy demand alone is forecast to rise 18.3% over the same period.

That growth is creating strong demand for reliable power infrastructure. Data centres, for example, run around the clock and cannot afford downtime, making backup power and efficient energy management essential. Socomec’s systems are designed to reduce power consumption without sacrificing reliability, a balance that is becoming increasingly important as operators look to manage both costs and environmental commitments.

Both companies say project planning and bids are already underway, with a long-term goal of expanding the partnership’s reach across Japan as demand grows.

About Daitron

Daitron Co., Ltd. is a Japanese engineering and trading company founded in 1952 and headquartered in Osaka. Listed on the Tokyo Stock Exchange (TYO: 7609), Daitron sells and manufactures electronic components, semiconductor processing equipment and power supply systems. The company has more than seven decades of experience serving Japan’s electronics and manufacturing industries.

SOCOMEC: When energy matters

Founded in 1922, SOCOMEC is an independent industrial group of more than 4,800 experts spread across the world in 30 subsidiaries. Our vocation: design, manufacture and sale of electrical equipment, with a strong expertize in critical power applications. In 2025, SOCOMEC achieved a turnover of 997 million euros (not yet audited).

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SOURCE Socomec

Technology

Multi-Destination Travel Surges Across Asia-Pacific This Labour Day, Trip.com Group Data Shows

Published

3 hours ago

April 30, 2026

Multi-city travel across Asia-Pacific grew 35% year-on-yearMulti-city travel outpaces single-destination growth by more than 2xSoutheast Asia sees strong double-digit growth, with Thailand up to 52% YoY

SINGAPORE, April 29, 2026 /CNW/ — Multi-city travel across Asia-Pacific grew 35% year-on-year this Labour Day period, according to data from Trip.com Group. Several Asia-Pacific markets including Japan, South Korea, parts of Southeast Asia and Mainland China celebrate Labour Day, driving strong cross-border and domestic travel flows across the region.

Over 30% of international trips now span multiple destinations, highlighting a continued shift towards more complex, itinerary-led travel. This shift reflects a growing preference to maximise time and value with multiple destinations within a single trip rather than a single location.

Multi-destination trips become a defining travel pattern

While single-destination travel continues to account for most bookings, growth is increasingly driven by more complex itineraries. Multi-destination bookings are growing at more than twice the pace of single-destination travel, reflecting stronger demand for flexibility and deeper exploration.

Travellers are increasingly structuring trips across multiple cities to maximise both time and value, with popular combinations including:

Tokyo – Osaka – Kyoto (Japan)Seoul – Busan (South Korea)Bangkok – Phuket (Thailand)

These itineraries reflect a growing preference for multi-stop journeys that blend urban experiences with leisure destinations.

Southeast Asia sees fast growth in multi-destination travel

Across Southeast Asia, demand for multi-destination travel is rising steadily, with strong growth across key markets of Thailand: 52%, Malaysia: 40%, and Singapore: 17%, according to Trip.com Group data.

Top outbound destinations across Southeast Asian markets include Japan (Tokyo, Osaka), South Korea (Seoul), China (Shanghai, Beijing), Thailand (Bangkok), Indonesia (Bali).

In other parts of Asia such as Hong Kong SAR, multi-destination travel also grew by over 50% year-on-year, highlighting growing preference for more complex itineraries over traditional single-destination trips, particularly in well-connected urban markets.

In Mainland China, domestic travel remains a strong base, while overseas journeys are increasingly shaped by multi-destination itineraries, with over 40% of outbound trips spanning multiple destinations and continuing to grow.

This suggests that travellers in this region are increasingly combining multiple cities within a single trip, supported by strong regional connectivity.

Japan’s domestic travel momentum on the rise

Japan is also seeing shifts in domestic travel behaviour, even as outbound demand continues to grow.

In Japan, domestic travel is growing rapidly, indicating rising interest in travelling within the country, accounting for one-quarter of all flight bookings, and to cities such as Tokyo, Sapporo and Okinawa.

Intra-Asia travel dominates Labour Day demand

The Labour Day holiday period continues to be driven by regional travel within Asia-Pacific, with travellers favouring destinations that offer ease of access, diverse experiences, and flexible itineraries.

The Group’s data highlights the continued strength of short-haul travel, supported by strong connectivity and shorter flight durations.

More broadly, the way people travel across Asia-Pacific is evolving. Travellers taking a more deliberate approach to how they plan their trips. While cross-border journeys are increasingly shaped by multi-city itineraries, domestic travel remains a strong and steady part of the landscape. Together, these patterns point to a more flexible and value-conscious mindset, as travellers look to make the most of both time and budget.

About Trip.com Group

Trip.com Group is a leading global travel service provider comprising of Trip.com, Ctrip, Skyscanner, and Qunar. Across its platforms, Trip.com Group helps travellers around the world make informed and cost-effective bookings for travel products and services and enables partners to connect their offerings with users through the aggregation of comprehensive travel-related content and resources, and an advanced transaction platform consisting of apps, websites and 24/7 customer service centres. Founded in 1999 and listed on NASDAQ in 2003 and HKEX in 2021, Trip.com Group has become one of the best-known travel groups in the world, with the mission “to pursue the perfect trip for a better world”. Find out more about Trip.com Group here: group.trip.com.