10x Genomics(US:TXG)2025-08-07 21:30Financial Data and Key Metrics Changes - Total revenue for Q2 2025 was $173 million, up 13% year-over-year, but excluding the settlement revenue, it was $146 million, down 5% [21][5] - Total consumables revenue was $122.2 million, down 1%, with Chromium consumables revenue at $85.8 million, down 9% [22][21] - Gross profit for Q2 was $125.1 million, with a gross margin increase to 72% from 68% year-over-year, primarily due to higher license and royalty revenue [26][21] - Net income for the period was $34.5 million compared to a net loss of $37.9 million in the previous year [27][21] Business Line Data and Key Metrics Changes - Spatial consumables revenue was $36.4 million, up 24%, driven by Xenium consumables revenue [22] - Total instrument revenue was $14.5 million, down 39%, with Chromium instrument revenue at $5.7 million, down 35% [23][22] - Services revenue increased by 47% to $8.5 million, primarily due to an increase in Xenium service plans [24][22] Market Data and Key Metrics Changes - Americas revenue was $78.9 million, down 15% year-over-year, while EMEA revenue was $34.7 million, down 7% [24] - APAC revenue was $32 million, up 41% year-over-year, benefiting from a temporary pull forward in purchasing activity in China [25][24] Company Strategy and Development Direction - The company is focused on advancing technology leadership in single cell and spatial biology, with new product launches aimed at lowering costs and expanding applications [12][19] - The acquisition of Scale Biosciences is expected to enhance the Chromium platform and broaden access to single cell analysis [19][28] - The company aims to maintain operational efficiency while investing in long-term growth despite a challenging funding environment [18][29] Management's Comments on Operating Environment and Future Outlook - The current funding environment is challenging, particularly in academic research, with cautious customer spending and extended project timelines [6][11] - Management noted that while there are signs of optimism among customers, actual spending remains conservative due to slow disbursement of funds [37][38] - The company expects Q3 revenue to be in the range of $140 million to $144 million, reflecting cautious customer spending behavior [28][21] Other Important Information - The company ended the quarter with $447 million in cash, cash equivalents, and marketable securities [27] - The company is committed to cost management and cash generation while pursuing strategic priorities [18][29] Q&A Session Summary Question: Can you discuss the current academic research funding environment? - Management noted that while there is more optimism compared to previous months, spending remains cautious due to slow fund disbursement and uncertainty around budgets [37][38] Question: What is the strategic rationale behind the Scale acquisition? - The acquisition aims to lower costs and drive higher scale in single cell applications, enhancing the company's existing product capabilities [41][42] Question: How is the sales force for Xenium performing in Europe? - The sales team is fully in place and ramping up, with improved execution despite a challenging capital expenditure environment [56][59] Question: What are the expectations for revenue from the Scale acquisition? - Near-term revenue impact from the acquisition is expected to be minimal, with a focus on integrating technologies into the broader portfolio [49][48] Question: What factors could unlock customer spending in the future? - Budget clarity for the next year and the actual disbursement of funds are seen as critical factors for unlocking customer spending [85][86]