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Pacific Biosciences' Q2 Revenues Climb 89 Percent

This article has been updated from a previous version to include information from PacBio's earnings call.

NEW YORK (GenomeWeb) – Pacific Biosciences reported after the close of the market Thursday that its second quarter 2014 revenues grew 89 percent year over year.

Its stock took a hit in early Friday trade, however, on lower than anticipated orders.

The Menlo Park, Calif.-based single-molecule sequencing technologies firm reported Q2 revenues of $11.4 million, compared to $6 million in Q2 2013 and $11.6 million in Q1 2014. Revenues were on target with the average analyst estimate of $11.4 million.

Its product revenues were $7.7, up from $4.6 million, while service and other revenues increased to $1.9 million from $1.4 million. Revenues for Q2 2014 also included $1.7 million from PacBio's development agreement with Roche Diagnostics.

Revenues for the quarter reflected the installation of eight PacBio RS II systems, compared to three in the second quarter of 2013 and nine in Q1 2014. The company booked five PacBio RS II systems in the quarter, finishing with 10 in its backlog.

Piper Jaffray analyst William Quirk said in a note this morning that the number of orders feel short of his expectation of 10 orders for the quarter. PacBio's management cited "customer logistical and tender timing issues" for the shortfall, he said.

"The business has never been in better shape," CEO Mike Hunkapiller said during a conference call discussing the firm's second quarter results.

Instrument revenue for the quarter was $4.7 million, while consumable revenue was $3 million. On average, the company is generating approximately $125,000 in consumable revenue per system per year, Hunkapiller said. In addition, the company is on track to complete its first milestone project related to its agreement with Roche later this year, Hunkapiller added.

Ben Gong, the company's vice president of finance and treasurer, said during the call that the company is maintaining its previous forecast of $47 million to $48 million in full-year revenues, a 70 percent increase over 2013 revenues. He added that it expects to install the majority of the 10 systems currently in its backlog in the third quarter.

PacBio posted a net loss for the quarter of $19.1 million, or $.27 per share, compared to $20.5 million, or $.33 per share, in Q2 2013. It just beat the Wall Street estimate of a $.28 per share net loss.

Its R&D expenses were $12.4 million, up 6 percent from $11.7 million in the year-ago quarter, while SG&A expenses were $9 million, down 4 percent from $9.4 million in the prior year period.

As of June 30, it had cash and investments totaling $105 million.

In Friday morning trade on the Nasdaq, shares of PacBio were down around 9 percent at $4.98.