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Pacific Biosciences Q2 Revenues Up 14 Percent

NEW YORK – Pacific Biosciences reported after the close of the market on Tuesday that its second quarter 2019 revenues rose 14 percent year over year.

For the three months ended June 30, the Menlo Park, California-based company recognized total Q2 revenues of $24.6 million, compared to $21.6 million in Q2 2018, beating analysts' average estimate of $20.8 million. Revenues included $21.3 million in product revenue and $3.4 million in service and other revenue.

In a statement, PacBio noted that during the quarter it announced the commercial launch of its Sequel II System and Single Molecule, Real-Time (SMRT) Cell 8M chip. As of June 30, the firm had installed 41 Sequel II systems.

PacBio also said it expects its acquisition by Illumina to be completed in the fourth quarter of 2019. Previously the firm had expected the deal to be completed in mid-2019.

In its form 10-Q, filed with the US Securities and Exchange Commission, PacBio noted that "Under certain circumstances specified in the Merger Agreement, Illumina may be required to pay us a [reverse] termination fee of $98.0 million." The merger agreement states that in "certain other circumstances related to antitrust approvals" the reverse termination fee may be paid if the merger agreement is terminated after Nov. 1, 2019, although that date may be extended. Other conditions, not related to antitrust or competition laws, would have to be satisfied or waived.

Given the pending merger, PacBio said it would not be holding a conference call to discuss its Q2 financial results, nor does it expect to do so in the future.

PacBio's net loss in the quarter was $24.6 million, or $.16 per share, up from $22.5 million, or $.17 per share, in the prior year period, in line with the Wall Street estimate of a $.16 loss per share.

The firm's R&D expenses in Q2 2019 were $14.9 million, down 5 percent from $15.7 million a year ago. Its SG&A expenditures climbed 28 percent year over year to $19.1 million from $14.9 million. PacBio's operating expenses included $3.8 million associated with Illumina deal.

As of June 30, the company had $66.8 million in cash and investments.

In morning trading on the Nasdaq, shares of PacBio were trading up just under 3 percent at $5.63.

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