Core Insights - PacBio has appointed Haorui Gene as an official distributor in China to enhance access to its HiFi long-read sequencing technology, particularly in transfusion medicine and hematology [1][3][5] - Haorui Gene has established itself as a significant player in blood typing genomics since its founding in 2020, deploying multiple sequencing systems to improve HLA typing and blood group genotyping [2][5] - The partnership aims to make PacBio's HiFi sequencing the preferred method in blood genomics, emphasizing its accuracy in critical areas for transfusion safety and donor matching [3][5][6] Company Overview - PacBio is a leading life science technology company focused on high-quality sequencing solutions, including HiFi long-read and SBB short-read sequencing technologies [7] - Haorui Gene is recognized for its innovative contributions to clinical long-read sequencing and precision medicine through advanced genomic technologies [9] Partnership Details - Under the agreement, Haorui Gene will distribute PacBio's Vega platform across China, providing comprehensive support for clinical laboratories and blood centers [4][5] - The collaboration is positioned to address the growing demand for high-precision sequencing in clinical genomics, particularly in hematology [6]

PART I. FINANCIAL INFORMATION [Financial Statements (unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) This section presents the unaudited condensed consolidated financial statements for Pacific Biosciences of California, Inc. as of March 31, 2025, and for the three months ended March 31, 2025 and 2024, covering balance sheets, operations, cash flows, and notes [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $860.8 million from $1.26 billion due to reduced intangible assets, while total liabilities slightly increased and stockholders' equity sharply declined to $91.6 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $58,507 | $55,370 | | Investments | $284,603 | $334,561 | | Total current assets | $444,923 | $495,681 | | Intangible assets, net | $18,182 | $389,572 | | Goodwill | $317,761 | $317,761 | | **Total assets** | **$860,789** | **$1,260,447** | | **Liabilities & Equity** | | | | Total current liabilities | $66,602 | $66,299 | | Convertible senior notes, net | $646,214 | $647,494 | | **Total liabilities** | **$769,151** | **$753,853** | | **Total stockholders' equity** | **$91,638** | **$506,594** | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Total revenue slightly decreased to $37.2 million, while a significant increase in operating expenses, driven by $362.0 million amortization and $15.0 million impairment, led to a net loss of $426.1 million, or ($1.44) per share Q1 2025 vs. Q1 2024 Statement of Operations (in thousands, except per share amounts) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total revenue | $37,153 | $38,810 | | Gross (loss) profit | $(1,371) | $11,282 | | Research and development | $29,053 | $43,455 | | Sales, general and administrative | $40,168 | $43,753 | | Impairment charges | $15,000 | $— | | Amortization of acquired intangible assets (Operating) | $362,042 | $5,506 | | Operating loss | $(428,934) | $(81,362) | | **Net loss** | **$(426,075)** | **$(78,178)** | | **Net loss per share (Basic & Diluted)** | **$(1.44)** | **$(0.29)** | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities improved to $44.1 million, while investing activities provided $45.2 million and financing activities provided $2.0 million, resulting in a quarter-end cash balance of $60.7 million Q1 2025 vs. Q1 2024 Cash Flow Summary (in thousands) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(44,056) | $(75,682) | | Net cash provided by (used in) investing activities | $45,234 | $(34,136) | | Net cash provided by financing activities | $1,959 | $6,553 | | **Net increase (decrease) in cash** | **$3,137** | **$(103,265)** | | **Cash, cash equivalents, and restricted cash at end of period** | **$60,729** | **$79,368** | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail accounting policies and financial results, including a $15.0 million IPR&D impairment, $359.3 million accelerated amortization due to strategic shift, $4.6 million restructuring costs, and disclosures on convertible notes, leases, and legal proceedings - The company designs, develops, and manufactures advanced sequencing solutions, including **HiFi long-read sequencing technology**, for academic institutions, commercial labs, and pharmaceutical companies[15](index=15&type=chunk)[16](index=16&type=chunk)[17](index=17&type=chunk) - Due to ceasing development of its high-throughput short-read sequencing platform, the company recorded a **$15.0 million impairment charge** on the related In-Process R&D (IPR&D) asset, writing its value down to zero[54](index=54&type=chunk)[56](index=56&type=chunk) - Reflecting a strategic shift to prioritize HiFi sequencing, the company revised the useful life of developed technology from the 2021 Omniome acquisition, resulting in **$359.3 million of accelerated amortization** in Q1 2025[59](index=59&type=chunk) - In Q1 2025, the company initiated a restructuring plan with workforce reductions, incurring **$4.6 million in employee separation costs**, contributing to **$388.2 million** in total strategic shift-related costs[98](index=98&type=chunk)[99](index=99&type=chunk) - On March 7, 2025, the company amended its Menlo Park headquarters lease, extending the term to April 2034 and increasing operating lease assets and liabilities by **$29.6 million**[108](index=108&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=31&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2025 financial results, noting a 4% revenue decrease to $37.2 million, a gross loss of $1.4 million, and an operating loss of $428.9 million due to significant restructuring charges, while believing existing cash of $343.1 million is sufficient for over 12 months of operations [Overview and Outlook](index=31&type=section&id=Overview%20and%20Outlook) The company's 2025 strategic objectives include launching the Vega benchtop platform, accelerating Revio sample adoption, investing in future products, and advancing its clinical strategy, while Q1 2025 saw $37.2 million revenue, a $1.4 million gross loss, and a $428.9 million operating loss, with Revio sales cycles elongated by funding and sample volume uncertainties - The company's 2025 strategic objectives are to grow revenue and expand gross margins by focusing on four key activities: full-scale release of the **Vega benchtop platform**, accelerating sample throughput on the **Revio platform** with SPRQ chemistry, investing in future product launches, and progressing the clinical strategy[140](index=140&type=chunk)[143](index=143&type=chunk) Q1 2025 Financial Highlights | Metric | Value | Comparison | | :--- | :--- | :--- | | Revenue | $37.2 M | vs. $38.8 M in Q1 2024 | | Gross Loss | $1.4 M | vs. Gross Profit of $11.3 M in Q1 2024 | | Operating Loss | $428.9 M | vs. $81.4 M in Q1 2024 | | Cash, cash equivalents, and investments | $343.1 M | vs. $389.9 M at Dec 31, 2024 | - The sales cycle for Revio instruments continues to be elongated due to customer funding uncertainty (especially NIH), procurement delays, and slower-than-expected sample volume growth for some potential customers[145](index=145&type=chunk) [Results of Operations](index=34&type=section&id=Results%20of%20Operations) Total revenue decreased by 4% to $37.2 million in Q1 2025, driven by fewer Revio sales but partially offset by increased consumable and service revenue, while cost of revenue rose 40% due to restructuring charges, and operating expenses surged 362% from accelerated amortization and impairment charges, leading to a significant operating loss Revenue Breakdown (in thousands) | Revenue Type | Q1 2025 | Q1 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Product revenue | $31,113 | $35,009 | $(3,896) | (11%) | | Service and other revenue | $6,040 | $3,801 | $2,239 | 59% | | **Total revenue** | **$37,153** | **$38,810** | **$(1,657)** | **(4%)** | - Instrument revenue decreased primarily due to the sale of **12 Revio systems** in Q1 2025 compared to **28** in Q1 2024, partially offset by the sale of **28 new Vega systems**[152](index=152&type=chunk)[154](index=154&type=chunk) - The gross loss of **$1.4 million** was primarily driven by **$12.0 million** in restructuring charges within cost of revenue, including **$7.7 million** in inventory adjustments and **$3.8 million** in losses on purchase commitments[144](index=144&type=chunk)[157](index=157&type=chunk) - Operating expenses included a **$362.0 million amortization charge**, of which **$359.3 million** was accelerated amortization for technology from the 2021 Omniome acquisition, as the asset is no longer expected to generate economic benefit beyond March 31, 2025[161](index=161&type=chunk) - A gain of **$18.7 million** was recognized from the change in fair value of contingent consideration, as the liability was reduced to $0 due to the decision to cease development of the high-throughput short-read system[162](index=162&type=chunk)[163](index=163&type=chunk) [Liquidity and Capital Resources](index=37&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, the company had $343.1 million in cash, cash equivalents, and investments, which management believes is sufficient to fund operations for over 12 months, while net cash used in operating activities for Q1 2025 improved to $44.1 million, and expense reduction initiatives continue - The company believes its existing cash, cash equivalents, and investments of **$343.1 million** as of March 31, 2025, will be sufficient to fund projected operating requirements for more than 12 months[166](index=166&type=chunk) - The company has implemented and continues to implement expense reduction initiatives, including workforce reductions and facility downsizing, to lower its annualized run-rate operating expenses[168](index=168&type=chunk) Cash Flow Summary (in thousands) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(44,056) | $(75,682) | | Net cash provided by (used in) investing activities | $45,234 | $(34,136) | | Net cash provided by financing activities | $1,959 | $6,553 | [Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk exposure is interest rate changes affecting its investment portfolio, while convertible notes have fixed rates, and a hypothetical 100 basis-point interest rate change would impact the investment portfolio's fair value by approximately $1.8 million - The company's main market risk is interest rate risk on its investment portfolio, which consists of cash equivalents, U.S. government and agency securities, and corporate debt securities[189](index=189&type=chunk) - A hypothetical **100 basis-point (1%) increase or decrease** in interest rates would impact the fair value of the investment portfolio by approximately **$1.8 million** as of March 31, 2025[189](index=189&type=chunk) [Controls and Procedures](index=38&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes in internal control over financial reporting during the first quarter of 2025 - Management concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[191](index=191&type=chunk) - There were no material changes in the company's internal control over financial reporting during the quarter ended March 31, 2025[193](index=193&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=39&type=section&id=Item%201.%20Legal%20Proceedings) The company updated on legal matters, including the PGI patent infringement case transferred to Northern California with an October 2026 trial, and the resolution of the Take2 Technologies and CUHK patent case through patent acquisition - In the patent infringement case filed by Personal Genomics of Taiwan, Inc. (PGI), the case was transferred to the Northern District of California, and a trial date has been set for **October 5, 2026**[196](index=196&type=chunk) - The patent infringement lawsuit filed by Take2 Technologies and the Chinese University of Hong Kong (CUHK) was resolved, as on March 7, 2025, the company purchased the patent ('794 patent) from CUHK, and all related litigation claims have been discharged[197](index=197&type=chunk)[198](index=198&type=chunk) [Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks including commercialization, profitability, expense management, debt repayment, acquisition integration, new product transitions, competition, supply chain reliance, goodwill impairment, geopolitical tensions, IP protection, and regulatory challenges [Summary Risk Factors](index=43&type=section&id=Summary%20Risk%20Factors) Principal risks include product commercialization, profitability, expense management, debt repayment, acquisition integration, new product introductions, leadership changes, competition, supply chain reliance, IP disputes, and regulatory hurdles - Key business risks include the ability to successfully commercialize products, achieve profitability, implement expense reductions, and repay debt[204](index=204&type=chunk) - Operational risks involve managing new product introductions, reliance on sole-sourced components, manufacturing consistency, and intense industry competition[204](index=204&type=chunk) - External risks include the impact of trade tariffs, geopolitical tensions (especially with China), securing intellectual property, and potential cybersecurity incidents[204](index=204&type=chunk)[208](index=208&type=chunk) [Risks Related to Our Business](index=44&type=section&id=Risks%20Related%20to%20Our%20Business) Business risks include a history of losses, dependence on new product commercialization, lengthy sales cycles, product defects, reliance on single-source suppliers, intense competition, and concentration of sales among limited customers - The company has a history of net losses and expects to continue incurring significant losses, with no certainty of achieving or sustaining profitability[212](index=212&type=chunk) - Future success is highly dependent on the successful commercialization of the **Revio** and **Vega systems**, but the company may not be successful in transitioning customers from older products or competing platforms[207](index=207&type=chunk) - The company relies on single-source suppliers for critical components, including **SMRT Cells** and reagents, which exposes it to significant supply chain risks[243](index=243&type=chunk) - The company faces a highly competitive industry with numerous companies that have greater resources, brand recognition, and more established manufacturing and sales capabilities[253](index=253&type=chunk) [Risks Related to Our Intellectual Property](index=61&type=section&id=Risks%20Related%20to%20Our%20Intellectual%20Property) IP risks include uncertainty in securing and enforcing patents, ongoing legal proceedings for infringement claims, reliance on potentially terminable licensed IP, and obligations from open-source software usage - The company's ability to protect its technology is uncertain, and it may not be able to maintain a competitive advantage if it fails to secure or enforce its intellectual property rights[282](index=282&type=chunk)[283](index=283&type=chunk) - The company is currently and could in the future be subject to costly legal proceedings from third parties claiming its products infringe on their intellectual property rights, which is common in the industry[294](index=294&type=chunk) - Some important intellectual property is licensed from third parties, and the termination or reduction of these licensed rights could adversely impact the business[286](index=286&type=chunk) [Risks Related to Regulation](index=66&type=section&id=Risks%20Related%20to%20Regulation) Regulatory risks include potential FDA oversight for RUO products, exposure to export controls and trade tariffs, complex international laws, and ethical/privacy concerns impacting demand for genetic technology - The company's products are currently for Research Use Only (RUO), but they could become subject to regulation as medical devices by the FDA, which would increase costs and delay commercialization[301](index=301&type=chunk)[302](index=302&type=chunk) - The business is subject to enhanced trade tariffs, import/export restrictions, and other trade barriers, particularly due to geopolitical tensions between the U.S. and China, which could increase costs and harm operations[314](index=314&type=chunk) - The U.S. government has implemented and may expand export controls on emerging technologies, including biotechnology and AI-related computing resources, which could restrict the company's ability to sell products in certain markets like China[316](index=316&type=chunk)[317](index=317&type=chunk) [Risks Related to Owning Our Common Stock](index=72&type=section&id=Risks%20Related%20to%20Owning%20Our%20Common%20Stock) Stock ownership risks include high stock price volatility, potential market price depression from substantial stock sales, anti-takeover provisions hindering acquisitions, and no foreseeable dividend payments - The market price of the company's common stock has been and is expected to continue to be highly volatile due to a variety of factors, including financial results, competitor announcements, and general market conditions[326](index=326&type=chunk) - Sales of a substantial number of shares in the public market, or the perception of such sales, could adversely affect the stock price and dilute existing stockholders[328](index=328&type=chunk) - Anti-takeover provisions in the company's charter documents and under Delaware law may delay or prevent a change of control, potentially limiting the market price of the common stock[332](index=332&type=chunk)[333](index=333&type=chunk) [Risks Related to Our Notes](index=75&type=section&id=Risks%20Related%20to%20Our%20Notes) Risks for convertible senior notes include inability to fund cash settlements or repurchases upon fundamental change, and restrictive covenants on additional debt and liens impacting financial flexibility - The company may not have sufficient cash or be able to obtain financing to repurchase its convertible notes upon a fundamental change or to pay cash upon conversion, which would constitute a default[342](index=342&type=chunk)[343](index=343&type=chunk) - A letter agreement related to the 2029 Notes imposes negative covenants that restrict the company's ability to incur additional debt and create liens, potentially affecting its ability to finance operations[344](index=344&type=chunk)[346](index=346&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=82&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities or use of proceeds during the period - None[381](index=381&type=chunk) [Defaults Upon Senior Securities](index=82&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities - None[382](index=382&type=chunk) [Mine Safety Disclosures](index=82&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[383](index=383&type=chunk) [Other Information](index=83&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the last fiscal quarter - During the last fiscal quarter, no directors or officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement[385](index=385&type=chunk) [Exhibits](index=84&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including corporate governance documents, material contracts, CEO/CFO certifications, an employment letter, and the outside director compensation policy - The report lists all exhibits filed, including certifications from the CEO and CFO, and XBRL data files[387](index=387&type=chunk)

Core Viewpoint - PacBio has entered a strategic collaboration with Chulalongkorn University to implement its HiFi whole genome sequencing technology in newborn screening, marking a significant advancement in genomic research and public health in the Asia Pacific region [1][4]. Company Summary - The collaboration represents the first population-scale deployment of PacBio's HiFi technology in the Asia Pacific, aimed at improving the identification of rare, treatable conditions in newborns [1][4]. - PacBio's HiFi WGS technology offers a more comprehensive view of the genome, capturing genetic variants that traditional methods may miss, thus enhancing early diagnosis and intervention capabilities [8][10]. - The company currently has a market capitalization of $336.1 million and anticipates earnings growth of 13.1% in 2025 [5]. Industry Summary - The global whole genome sequencing market is projected to reach $2.12 billion in 2024, with an expected compound annual growth rate (CAGR) of 22.17% from 2025 to 2030, driven by technological advancements and increasing demand for personalized medicine [11][12]. - The collaboration positions Thailand as a leader in precision medicine within the Asia Pacific, potentially catalyzing similar initiatives in other countries and expanding PacBio's market presence [10].

MENLO PARK, Calif., May 12, 2025 (GLOBE NEWSWIRE) -- PacBio (NASDAQ: PACB) today announced that the Special Committee of its Board of Directors (the “Special Committee”) has concluded its independent investigation into previously disclosed allegations from an attorney representing an employee impacted by our recent reduction in force regarding certain employment practices and cybersecurity matters of the Company. The allegations did not involve the current, or any previously reported, financial results, and ...

Core Insights - PacBio reported an adjusted loss per share of 15 cents for Q1 2025, an improvement from a loss of 26 cents in the same quarter last year, exceeding the Zacks Consensus Estimate by 21.1% [1] - Total revenues for the first quarter were $37.2 million, down 4.3% year over year, but above the Zacks Consensus Estimate by 6.2% [2] - The company experienced a decline in revenues across the Americas and Asia-Pacific regions, while the EMEA region saw an 11% increase in revenues [3][4][5] Revenue Breakdown - Revenues from the Americas were $16.3 million, an 8% decline year over year due to government funding challenges [3] - Asia-Pacific revenues totaled $11.6 million, reflecting a 9% decline, although consumables performed well due to increased utilization of the Revio system [4] - EMEA revenues reached $9.3 million, an 11% increase, driven by strong Revio placements in the hospital and clinic segment [5] Segment Analysis - Total product revenues were $31.1 million, down 11.1% year over year, with instrument revenues significantly impacted, falling 42.1% to $11 million [6] - Consumables revenues increased by 25.6% to $20.1 million, with annualized Revio pull-through per system at $236,000 [7] - Service and other revenues rose 57.9% to $6 million, attributed to increased service contract revenues related to Revio [7] Margin and Expense Trends - Adjusted gross profit increased 18.8% year over year to $15 million, with adjusted gross margin expanding by 700 basis points to 40% [8] - Sales, general, and administrative expenses decreased by 8.2% to $40.2 million, while research and development expenses fell 33.2% to $29.1 million [8] - Total adjusted operating loss was $54.2 million, an improvement from $74.6 million in the prior year [9] Financial Position - At the end of Q1 2025, PacBio had cash and investments totaling $343.1 million, down from $389.9 million at the end of 2024 [10] Guidance and Outlook - For Q2 2025, PacBio expects revenues to be flat compared to Q1 2025, with a Zacks Consensus Estimate of $36.9 million [11] - The company revised its 2025 revenue outlook to between $150 million and $170 million, down from the previous guidance of $155 million to $170 million [12] Strategic Initiatives - PacBio initiated a company-wide restructuring plan aimed at reducing operating expenses by approximately $45 million to $50 million by the end of 2025 [14] - The company entered a licensing agreement to enhance methylation detection capabilities within its HiFi sequencing platform, which is expected to expand applications in cancer research and rare disease diagnostics [15] - Performance was impacted by macroeconomic challenges, including reduced academic funding and U.S.-China tariffs, leading to a decline in Revio system shipments [16]

Core Insights - Pacific Biosciences of California (PACB) reported a revenue of $37.15 million for the quarter ended March 2025, reflecting a decrease of 4.3% year-over-year, but exceeding the Zacks Consensus Estimate by 6.15% [1] - The company's EPS was -$0.15, an improvement from -$0.26 in the same quarter last year, and surpassed the consensus EPS estimate of -$0.19 by 21.05% [1] Revenue Breakdown - Revenue from Product-Instrument was $11 million, falling short of the estimated $12.21 million, marking a significant decline of 42.1% year-over-year [4] - Revenue from Product reached $31.11 million, slightly above the estimated $30.90 million [4] - Revenue from Service and other sources was $6.04 million, exceeding the estimated $4.97 million, representing a substantial increase of 58.9% year-over-year [4] - Revenue from Product-Consumable was $20.10 million, surpassing the average estimate of $18.69 million, with a year-over-year growth of 25.6% [4] Stock Performance - Over the past month, shares of Pacific Biosciences have declined by 22.1%, contrasting with the Zacks S&P 500 composite's increase of 11.3% [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Pacific Biosciences of California (PACB) Q1 2025 Earnings Call May 08, 2025 04:30 PM ET Company Participants Todd Friedman - Senior Director, FP&A and Investor RelationsChristian Henry - President & Chief Executive OfficerTom Nikic - Managing Director, Equity ResearchJim Gibson - CFOHarrison Parsons - Equity Research AssociateWilliam Ruby - Equity Research Associate Conference Call Participants Jake Titleman - AnalystJack Meehan - Equity Research AnalystAlex Vukasin - VP Healthcare Equity Research AnalystDa ...

Financial Performance - PacBio Q1 2025 revenue was $37.2 million[9,43], a decrease of 8% year-over-year compared to $38.8 million in Q1 2024[47] - Q1 2025 consumable revenue reached a company record of $20.1 million, representing a 26% year-over-year growth[14] - The company's Q1 2025 non-GAAP gross margin was approximately 40%, an increase from approximately 33% in Q1 2024[50] - Non-GAAP operating expenses for Q1 2025 were $61.7 million, a 29% decrease compared to Q1 2024[50] - PacBio anticipates revenue between $150 million and $170 million for 2025, representing approximately 4% growth at the midpoint[20,55] Product and System Updates - Q1 instrument revenue was $11.0 million, lower year-over-year due to increased uncertainty in academic funding[9] - PacBio shipped 12 Revio systems and 28 Vega systems in Q1 2025[9] - Approximately 50% of Revio and Vega systems were shipped to new customers[9,28] - The annualized Revio pull-through for Q1 2025 was $236,000[14,43] - Nearly 90% of Revio reagent kit shipments in Q1 2025 utilized SPRQ chemistry[23] Strategic Initiatives - PacBio implemented a restructuring plan in April, expecting to lower annualized non-GAAP operating expenses by $45 million to $50 million by year-end[21]

Revenue Performance - Preliminary Q1 2025 revenue was $36.9 million, a decrease of 5% from $38.8 million in Q1 2024[3]. - Instrument revenue declined to $10.8 million from $19.0 million year-over-year, while consumable revenue increased to a record $20.1 million from $16.0 million[3][4]. - The full-year 2025 revenue guidance remains at $155 million to $170 million[7]. Cost Management - The company plans to reduce annualized non-GAAP operating expenses by $45 million to $50 million, adjusting previous guidance from $270 million to $280 million[5][9]. - The company expects 2025 non-GAAP gross margin to be between 35% and 40%[15]. Sales and Demand - Annualized Revio pull-through per system was approximately $236,000, consistent with expectations in the low to mid $200,000s range[4][15]. - Vega system orders accelerated in Q1 2025 compared to Q4 2024, indicating strong demand from both new and existing customers[4]. Financial Position - Cash, cash equivalents, and investments totaled $343.1 million, down from $561.9 million in Q1 2024[3]. Organizational Changes - The company is restructuring its commercial organization to improve sales force efficiency while maintaining customer service across all segments[6]. Future Outlook - PacBio aims to achieve positive cash flow by the end of 2027 despite ongoing market uncertainties[6].

Core Insights - PacBio reported a decline in revenue for Q1 2025, totaling $37.2 million compared to $38.8 million in Q1 2024, with notable decreases in instrument revenue and an increase in consumable revenue [2][3] - The company initiated a restructuring plan aimed at reducing operating expenses and focusing on its long-read business, which is expected to save approximately $45 million to $50 million annually by the end of 2025 [6][8] - PacBio's GAAP net loss for Q1 2025 was $426.1 million, significantly higher than the $78.2 million loss reported in Q1 2024, while the non-GAAP net loss improved to $44.4 million from $71.4 million year-over-year [5][32] Financial Performance - Instrument revenue decreased from $19.0 million in Q1 2024 to $11.0 million in Q1 2025, while consumable revenue increased from $16.0 million to $20.1 million [2] - The company reported a GAAP gross profit of negative $1.4 million for Q1 2025, down from a gross profit of $11.3 million in Q1 2024, largely due to restructuring-related charges [3][33] - Non-GAAP gross profit for Q1 2025 was $15.0 million, an increase from $12.6 million in Q1 2024, with a non-GAAP gross margin of 40% compared to 33% in the prior year [3][33] Operating Expenses - GAAP operating expenses surged to $427.6 million in Q1 2025 from $92.6 million in Q1 2024, primarily due to restructuring charges [4] - Non-GAAP operating expenses decreased to $61.7 million in Q1 2025 from $87.2 million in Q1 2024, reflecting the impact of the restructuring efforts [4][33] Strategic Initiatives - The company entered a licensing agreement with The Chinese University of Hong Kong to enhance methylation detection capabilities in HiFi sequencing, which is expected to support applications in cancer research and neuroscience [6] - PacBio was selected as a sequencing partner by the Davos Alzheimer's Collaborative for a new initiative aimed at advancing Alzheimer's disease research in North Africa [7] Management Commentary - The CEO highlighted a solid start to the year with record consumables revenue and improved non-GAAP gross margin, while expressing caution regarding the macroeconomic environment and its potential impact on funding [8] - The company aims to achieve cash flow breakeven by the end of 2027, indicating a long-term strategic focus despite current challenges [8]