This article was originally published on Jan. 29.
Microarrays are still a growing business for Illumina.
The San Diego company, which has captured attention recently for introducing a number of next-generation sequencing instruments, reported a 10 percent spike in array-related revenues for the fourth quarter of 2013.
For the full year, array revenues also increased 3 percent over 2012 revenues, though these twin achievements were dwarfed by its total revenue growth of 25 percent in Q4 on the back of sequencing-related sales.
As the company reported this week, during the last three months of 2013, it took in $387.3 million in total revenues, up from $309.3 million in the fourth quarter of '12. Full-year 2013 revenues were up 23 percent to $1.42 billion from $1.15 billion last year.
While the company did not break out its array revenue amounts, CEO Jay Flatley said on an earnings call following the release of the results this week that Illumina saw demand rise for its arrays across the business, including growth in sales of consumables, instruments, and genotyping services.
He cited consumer genomics and reproductive health as two market segments that were responsible for the performance of the array business, and noted that Illumina anticipates a similar dynamic this year.
On the consumer genomics side, Illumina continues to supply most of the major companies and organizations that provide ancestry testing – including Ancestry.com, Family Tree DNA, National Geographic, Scotlands DNA, and 23andMe – with arrays and services.
And, according to Flatley, Illumina is "pretty optimistic that there is going to be a very large number of consumer samples [run] in 2014." He said that Matt Posard, who heads Illumina's recently formed New and Emerging Markets business unit, is "pretty confident that we will do more consumer samples in 2014 than we've ever done in total before."
Flatley did not say how much revenue consumer genomics-related sales could generate this year. Last May, he estimated that they could contribute about $50 million to total 2013 revenues.
"That's going to take us closing … a couple big deals to make that happen, but we're pretty confident about those" estimates, said Flatley.
During the call, Amit Bhalla, a director at Citi Investment Research & Analysis, asked Flatley a question about the "cadence of the consumer array component of the business, given that … one of your customers is in limbo right now."
Though Bhalla did not name the firm, he seemed to be referring to 23andMe. The Mountain View, Calif.-based company received a US Food and Administration letter on Nov. 22 ordering it to halt marketing of its Personal Genome Service until authorized. On Dec. 5, 23andMe stopped offering personal health interpretations, though it has continued to serve clients interested in ancestry testing.
"I think the company you referenced is sort of evaluating their options right now," Flatley answered.
Flatley also said that Illumina is in the process of evaluating "many other consumer opportunities that are somewhat different than the business model that particular company has."
Illumina's consumer genomics-related array sales were only one part of the company's Q4 performance. On the call, Flatley noted that sales of BlueGnome's arrays for in vitro fertilization spiked 60 percent year over year. Demand for its OncoArray, launched in October, contributed to the "record number of Infinium samples shipped" during the quarter.
In the case of the OncoArray, it is a trend that is likely to continue. OncoArray consortium users told BioArray News last year that they plan to genotype nearly half a million samples using the 24-sample chip, which covers variants associated with five common cancers – breast, ovarian, colon, lung, and prostate.
And more arrays are in the works. Tristan Orpin, general manager of the company's newly formed reproductive and genomic health business unit, said during a webcast presentation at Illumina's recent investor day event that the firm will introduce a 12-sample CytoSNP karyomapping array for pre-implantation genetic diagnosis later this quarter.
While the consumer genomics and IVF markets might seem unrelated, for Illumina they provide steady sources of revenues that are unaffected by state funding issues. Given sequestration in the US, and oft-unstable funding environments abroad, Illumina in recent years has worked to diversify its customer base, "which we've measured by the percentage of shipments to commercial, nonprofit, and hospital customers," Flatley noted on the call.
He said that Illumina "successfully reached this goal in the fourth quarter," as approximately 50 percent of its shipments were to these "non-traditional segments."