This article has been updated from a previous version to include comments made during Pacific Biosciences' earnings call.
NEW YORK (GenomeWeb) – Pacific Biosciences reported after the close of the market on Wednesday that its second quarter revenues declined 3 percent compared to the second quarter of 2016.
PacBio recognized total revenues of $20.1 million in Q2 2017, versus $20.7 million in Q2 2016, and below analysts' average estimate of $23.8 million.
The drop was due to the lack of $3.6 million in contractual revenue that it received in Q2 2016 from its agreement with Roche that it no longer receives. By contrast, all of Q2 2017 revenue was generated from product and services, which increased 17 percent over the $17.2 million in product and services revenue PacBio recognized in Q2 2016.
Product revenue included $9.6 million in consumable revenue, up 87 percent from $5.0 million in Q2 2016, and $7.1 million in instrument revenue, down 17 percent from $8.6 million in Q2 2016. Revenue from services was relatively flat year-over-year at $3.6 million.
During a conference call discussing the company's Q2 performance, CEO Mike Hunkapiller said that growth in consumable revenue was driven by increased utilization of the firm's Sequel instrument as well as a growing installed base. Importantly, he said, average consumable revenue per Sequel instrument is now higher than it was on the previous RS II instrument.
In addition, Hunkapiller said that PacBio raised $65 million in cash during Q2 2017 through a combination of a follow-on stock offering as well as through its ATM facility.
Ben Gong, PacBio's VP of finance and treasurer reiterated that the company expected between 35 percent and 45 percent growth in product and service revenue in 2017 compared to 2016.
The Menlo Park, California-based company had R&D expenses of $16.9 million, down from $17.5 million in the prior year period. Its SG&A expenses were $15.5 million, up from $11.2 million in Q2 2016.
The company ended the quarter with $102.6 million in cash and investments.
Shares of PacBio's stock were down less than 1 percent to $3.20 at the close of the market on Wednesday.