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Fluidigm Q4 Revenues Down 18 Percent on Lower Instrument Sales

NEW YORK (GenomeWeb) – Fluidigm announced after the close of the market Wednesday that its fourth quarter revenues decreased 18 percent year over year.

For the three months ended Dec. 31, the South San Francisco, California-based instrument firm reported total revenues of $25.1 million compared to $30.7 million in the year-ago period, within its projected revenue range of $24.7 million to $25.2 million but short of the Wall Street estimate of $ 25.9 million.

"We are taking the necessary steps to change the company's prospects for the better," CEO Chris Linthwaite said on a conference call following the release of results. "While we are encouraged by our fourth quarter progress and sequential revenue growth, we are not satisfied. We are firmly focused on restoring momentum and delivering on our core strategic priorities of fostering innovation and partnerships; increasing operational efficiency; and improving financial discipline." Linthwaite, who replaced Cofounder Gajus Worthington in October, noted 2017 will be a "transition" year.

Fludigm's turnaround will be based on innovation, efficiency, and financial discipline, Linthwaite said. "We are continuing the pioneering spirit that got us here with a measured approach to portfolio management balanced by three factors: revenue potential, margin profile, and technology development," he said, adding that the firm will tack towards adding strategic partnerships to supplement its business.

Already, the firm has partnered with GenomOncology, and Linthwaite mentioned translational cancer research as a target area for partnerships. The firm has been in discussions with the Cancer Moonshot Task Force, he noted.                                                                        

Linthwaite pointed to several extremely granular figures as good indications of the potential to recover. Growth in mass cytometry consumables revenue was strong, especially in the biopharma end market, he said, and revenue from China jumped 77 percent year over year in Q4 and 98 percent for the full year, compared to 2015.  

Instrument revenue declined 32 percent year over year to $10.7 million due to decreased sales, primarily in the Helios mass cytometry line but also in C1 single-cell sample prep systems.

Fluidigm's consumables revenue fell 12 percent year over year to $10.3 million primarily due to decreased sales of integrated fluidic circuits. Service revenue increased 26 percent to $4.1 million due to increased service contracts.

On the call, Fluidigm CFO Vikram Jog noted that the firm would provide a finer level of disclosure on its installed base going forward. "We believe that our active installed base presents a better gauge of instrument utilization," he said. The firm's total installed base at the end of 2016 was 1,855 instruments, of which 1,340 were active. Of this, approximately 950 systems were designated for single-cell biology research.

The company's R&D spending in the quarter dropped 10 percent to $8.8 million from $9.7 million a year ago, while its SG&A expenses increased 3 percent to $22.8 million from $22.1 million.

Fluidigm's net loss for the quarter was $17.7 million, or $.61 per share, compared to $12.9 million, or $.45 per share, in the year-ago period. EPS was in line with analysts' expectation.

For full-year 2016, Fluidigm's revenues decreased 9 percent to $104.4 million from $114.7 million in 2015, within the projected range of $104.1 million to $104.6 million, but short of the consensus analysts' estimate of $1095.3 million.

Instrument revenue for the year declined 20 percent to $46.8 million, driven by decreased sales across most instruments, especially genomics instruments. Consumables revenue declined 3 percent to $42.2 million, primarily driven by fewer Access Array Integrated Fluidic Chips and partially offset by growth in Helios consumables. Service revenues increased 23 percent to $15.2 million.

Fluidigm's R&D expenses fell 2 percent to $38.4 million from $39.3 million, while its SG&A expenses rose 12 percent to $93.2 million from $83.0 million.

The firm's net loss in 2016 was $76.0 million, or $2.62 per share, compared to $53.3 million, or $1.86 per share, in 2015, meeting the Wall Street estimate of a loss per share of $2.62.

Fluidigm ended the year with approximately $59.4 million in cash, cash equivalents, and investments.

For the first quarter of 2017, the company projects approximately equal revenue with Q4 2016.

Linthwaite noted that while the firm has suspended full-year guidance, it would begin issuing quarterly guidance. For the first quarter of 2017, the company projects approximately equal revenue with Q4 2016.