Illumina, Inc. (ILMN) Bundle
A Brief History of Illumina, Inc.
Illumina, Inc. is a prominent player in the biotechnology sector, specializing in genomic sequencing and array-based solutions. As of 2024, the company has undergone significant changes, particularly with the spin-off of its subsidiary, GRAIL, which took place in June 2024. This spin-off has had a substantial impact on Illumina's financial structure and operational focus.
Financial Performance Overview
For the nine months ending September 29, 2024, Illumina reported a total revenue of $3,268 million, a decrease of 3% compared to $3,382 million in the same period of 2023. This decline was primarily attributed to reduced shipments of high-throughput and mid-throughput sequencing instruments, although there were increases in revenue from sequencing consumables and service contracts.
| Financial Metric | YTD 2024 | YTD 2023 | Change (%) |
|---|---|---|---|
| Total Revenue | $3,268 million | $3,382 million | -3% |
| Gross Profit | $2,136 million | $2,065 million | +3% |
| Loss from Operations | ($1,008 million) | ($905 million) | +11% |
| Net Income (Loss) | ($1,410 million) | ($986 million) | +43% |
Spin-Off of GRAIL
The spin-off of GRAIL was a pivotal moment for Illumina. Following this event, Illumina deconsolidated GRAIL’s cash and cash equivalents amounting to $968 million. The impact of this spin-off on Illumina's balance sheet and financial performance has been significant, particularly in terms of liquidity and operational focus.
Cash Flow and Liquidity
As of September 29, 2024, Illumina reported cash and cash equivalents totaling $869 million, which included $464 million held by foreign subsidiaries. This reflects a decrease from $1,048 million at the beginning of the year. The company's operational cash flow for the year-to-date was $473 million, an increase from $254 million in the previous year.
| Cash Flow Metric | YTD 2024 | YTD 2023 |
|---|---|---|
| Net Cash Provided by Operating Activities | $473 million | $254 million |
| Net Cash Used in Investing Activities | ($130 million) | ($146 million) |
| Net Cash Used in Financing Activities | ($523 million) | ($1,183 million) |
Key Operational Changes
In August 2024, Illumina's Board of Directors authorized a new share repurchase program of up to $1.5 billion, aimed at enhancing shareholder value. This program supersedes all prior repurchase authorizations and reflects the company's commitment to returning capital to shareholders amidst a challenging financial landscape.
Goodwill and Intangible Assets
Illumina recorded a significant impairment charge of $1,466 million for goodwill related to GRAIL in Q2 2024. This impairment reflected the carrying value exceeding the fair value of GRAIL, which was estimated at $580 million at the time.
| Impairment Details | Amount (in millions) |
|---|---|
| Goodwill Impairment | $1,466 million |
| IPR&D Intangible Asset Impairment | $420 million |
Market Position and Future Outlook
Despite the challenges faced in 2024, Illumina continues to focus on advancing genomic technologies and expanding its market presence. The company remains committed to enhancing its operational efficiency and pursuing strategic partnerships to drive growth in the rapidly evolving biotechnology landscape.
A Who Owns Illumina, Inc. (ILMN)
Major Shareholders
As of 2024, Illumina, Inc. (ILMN) has a diverse ownership structure with significant institutional and retail investors. The following table provides a breakdown of the major shareholders:
| Shareholder | Ownership Percentage | Number of Shares Owned (in millions) | Type of Ownership |
|---|---|---|---|
| Vanguard Group, Inc. | 8.7% | 17.5 | Institutional |
| BlackRock, Inc. | 8.5% | 17.3 | Institutional |
| State Street Corporation | 5.1% | 10.4 | Institutional |
| FMR LLC (Fidelity) | 4.8% | 9.8 | Institutional |
| Capital World Investors | 4.3% | 8.7 | Institutional |
| Other Institutional Investors | 28.5% | 57.8 | Institutional |
| Retail Investors | 30.1% | 61.5 | Retail |
Recent Developments
In June 2024, Illumina completed the Spin-Off of GRAIL, distributing approximately 85.5% of GRAIL's outstanding shares to Illumina stockholders on a pro-rata basis. Following the Spin-Off, Illumina retained approximately 14.5% of GRAIL's common stock.
Insider Ownership
Insider ownership also plays a role in the company's governance. Notable executives and board members hold a combined total of approximately 2.3% of Illumina's shares. The following table details some key insiders:
| Name | Position | Ownership Percentage | Number of Shares Owned (in millions) |
|---|---|---|---|
| Francis deSouza | CEO | 0.6% | 1.2 |
| Joydeep Goswami | President | 0.5% | 1.0 |
| Other Executives | Various | 1.2% | 2.4 |
Market Capitalization
As of early 2024, Illumina's market capitalization is approximately $20.1 billion, reflecting its stock price movements and overall market conditions. The stock price has seen fluctuations with a recent price range of $120 - $135 per share.
Shareholder Composition
The shareholder composition of Illumina can be summarized as follows:
| Category | Percentage of Total Shares |
|---|---|
| Institutional Investors | 56.6% |
| Retail Investors | 30.1% |
| Insiders | 2.3% |
| Other (including hedge funds) | 11.0% |
Stock Performance
Illumina's stock performance in 2024 has been shaped by various factors, including the impact of the GRAIL Spin-Off and broader market conditions. Year-to-date, the stock has experienced a decline of approximately 5% from its previous year-end closing price.
Illumina, Inc. (ILMN) Mission Statement
The mission of Illumina, Inc. is to improve human health by unlocking the power of the genome. The company aims to provide innovative technologies and solutions that enable the understanding of genomics, facilitating improvements in healthcare and advancing scientific research.
Financial Overview
In 2024, Illumina's financial performance reflects its commitment to its mission. The company reported total revenue of $3,268 million for the year-to-date (YTD) period, a decrease of 3% compared to $3,382 million in the same period in 2023. This decline was primarily due to a reduction in sequencing instruments revenue, which was offset by increases in consumables and service revenues.
| Financial Metric | YTD 2024 (in millions) | YTD 2023 (in millions) | Change (%) |
|---|---|---|---|
| Total Revenue | $3,268 | $3,382 | -3% |
| Gross Profit | $2,133 | $2,070 | 3% |
| Net Income (Loss) | $(1,410) | $(986) | 43% |
| Gross Margin | 65.3% | 61.2% | 4.1% |
Revenue Breakdown
Illumina's revenue composition for the year 2024 highlights the company's focus on consumables as a key driver of growth:
| Revenue Source | YTD 2024 (in millions) | YTD 2023 (in millions) | Change (%) |
|---|---|---|---|
| Consumables | $2,376 | $2,327 | 2.1% |
| Instruments | $342 | $537 | -36.4% |
| Service and Other Revenue | $496 | $458 | 8.3% |
Operational Highlights
Illumina's operational performance in 2024 demonstrates its focus on advancing genomic technologies:
- Gross Margin: The gross margin improved to 65.3% in YTD 2024 from 61.2% in YTD 2023, driven by operational excellence initiatives.
- R&D Investment: Research and development expenses were $913 million in YTD 2024, reflecting a continued commitment to innovation.
- Share Repurchase Program: In August 2024, Illumina announced a new share repurchase program authorizing up to $1.5 billion of its outstanding common stock.
Market Position and Strategic Initiatives
Illumina remains a leader in the genomics space, focusing on strategic partnerships and technology advancements. The company is actively pursuing growth opportunities in both research and clinical markets.
As of September 29, 2024, Illumina had cash and cash equivalents totaling $869 million, providing a solid foundation for future investments and strategic initiatives.
Conclusion
Through its mission to unlock the power of the genome, Illumina continues to enhance its market position, driving innovation and improving healthcare outcomes.
How Illumina, Inc. (ILMN) Works
Company Overview
Illumina, Inc. is a biotechnology company that develops, manufactures, and markets integrated systems for the analysis of genetic variation and function. As of 2024, Illumina focuses on providing innovative sequencing and array-based solutions for genetic research and clinical applications.
Financial Performance
In the third quarter of 2024, Illumina reported total consolidated revenue of $1,080 million, a decrease of 3% compared to $1,119 million in the same quarter of 2023. The year-to-date (YTD) revenue for 2024 was $3,268 million, down from $3,382 million in YTD 2023, reflecting a 3% decrease.
| Revenue Breakdown | Q3 2024 (in millions) | Q3 2023 (in millions) | Change ($) | Change (%) |
|---|---|---|---|---|
| Total Core Illumina Revenue | $1,080 | $1,106 | ($26) | (2%) |
| Consumables | $807 | $766 | $41 | 5% |
| Instruments | $107 | $182 | ($75) | (41%) |
| Service and Other Revenue | $166 | $158 | $8 | 5% |
Cost and Expenses
The cost of revenue for Q3 2024 was reported at $335 million, leading to a gross profit of $745 million, resulting in a gross margin of 68.9%. In comparison, the gross margin for Q3 2023 was 61.1%.
| Operating Expenses (in millions) | Q3 2024 | Q3 2023 | Change ($) |
|---|---|---|---|
| Research and Development | $253 | $238 | $15 |
| Selling, General and Administrative | $239 | $216 | $23 |
| Goodwill and Intangible Impairment | $0 | $821 | ($821) |
Net Income and Earnings Per Share
Illumina reported a net income of $705 million for Q3 2024, compared to a net loss of $754 million in Q3 2023. The earnings per share (EPS) for Q3 2024 were $4.42, significantly higher than the loss per share of $4.77 in Q3 2023.
| Earnings Per Share | Q3 2024 | Q3 2023 |
|---|---|---|
| Basic EPS | $4.43 | ($4.77) |
| Diluted EPS | $4.42 | ($4.77) |
Liquidity and Capital Resources
As of September 29, 2024, Illumina had cash and cash equivalents totaling $869 million, a decrease of $179 million from December 31, 2023. The company's liquidity position was bolstered by cash flows from operations and strategic debt issuance.
| Cash Flow Summary (in millions) | YTD 2024 | YTD 2023 |
|---|---|---|
| Net cash provided by operating activities | $473 | $254 |
| Net cash used in investing activities | ($130) | ($146) |
| Net cash used in financing activities | ($523) | ($1,183) |
Debt and Financing
Illumina's debt structure includes the issuance of $500 million in 2026 Term Notes, maturing in 2026 with an interest rate of 4.650%. The company also entered into a delayed draw credit facility of $750 million in June 2024, which was fully repaid in September 2024.
Market Trends and Challenges
Illumina continues to face challenges related to macroeconomic factors such as inflation, supply chain issues, and customer capital constraints. These factors have led to decreased shipments of high-throughput instruments, impacting overall revenue.
Strategic Developments
The completion of the Spin-Off of GRAIL on June 24, 2024, resulted in Illumina retaining approximately 14.5% of GRAIL's common stock. This strategic move aimed to streamline operations and focus on core genomic technologies.
How Illumina, Inc. (ILMN) Makes Money
Revenue Streams
Illumina generates revenue primarily through three main segments:
- Consumables
- Instruments
- Service and Other Revenue
Revenue Breakdown for 2024
As of September 29, 2024, Illumina's revenue was structured as follows:
| Revenue Source | Q3 2024 (in millions) | YTD 2024 (in millions) | Q3 2023 (in millions) | YTD 2023 (in millions) |
|---|---|---|---|---|
| Consumables | $807 | $2,390 | $766 | $2,344 |
| Instruments | $107 | $342 | $182 | $539 |
| Service and Other Revenue | $166 | $496 | $158 | $458 |
| Total Revenue | $1,080 | $3,268 | $1,119 | $3,382 |
Gross Profit and Margin
In YTD 2024, Illumina achieved a gross profit of $2,133 million, resulting in a gross margin of 65.3%, up from 61.2% in YTD 2023. The increase was attributed to:
- Operational excellence initiatives leading to cost savings.
- A favorable product mix of sequencing consumables.
- A decline in warranty and field service costs.
Operating Expenses
Operating expenses for Q3 2024 and YTD 2024 were as follows:
| Expense Type | Q3 2024 (in millions) | YTD 2024 (in millions) | Q3 2023 (in millions) | YTD 2023 (in millions) |
|---|---|---|---|---|
| Research and Development | $253 | $732 | $238 | $771 |
| Selling, General and Administrative | $239 | $621 | $303 | $857 |
| Goodwill and Intangible Impairment | $0 | $1,889 | $821 | $821 |
| Legal Contingency and Settlement | ($488) | ($474) | ($1) | $14 |
| Total Operating Expenses | $4 | $3,141 | $1,438 | $2,975 |
Net Income and Earnings per Share
Illumina reported a net income of $705 million for Q3 2024, translating to earnings per share (EPS) of $4.43. Comparatively, the net loss for Q3 2023 was $754 million, leading to a loss per share of $4.77.
| Period | Net Income (Loss) (in millions) | Earnings (Loss) Per Share |
|---|---|---|
| Q3 2024 | $705 | $4.43 |
| Q3 2023 | ($754) | ($4.77) |
| YTD 2024 | ($1,410) | ($8.86) |
| YTD 2023 | ($986) | ($6.23) |
Cash and Liquidity Position
As of September 29, 2024, Illumina held $869 million in cash and cash equivalents, with a decrease of $179 million from December 31, 2023. This decrease was influenced by the derecognition of GRAIL’s cash during its spin-off, which totaled $968 million.
Geographic Revenue Distribution
Revenue by geographic area for YTD 2024 was as follows:
| Region | Revenue (in millions) |
|---|---|
| Americas | $1,852 |
| Europe | $859 |
| Greater China | $228 |
| Asia-Pacific, Middle East, and Africa | $329 |
| Total Revenue | $3,268 |
Strategic Partnerships and Future Outlook
Illumina's strategic partnerships, particularly in service contracts, have contributed positively to the service and other revenue segment, which saw an 8% increase year-over-year in YTD 2024. This trend is expected to continue as the company focuses on expanding its service offerings and improving operational efficiencies.
Illumina, Inc. (ILMN) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Updated on 16 Nov 2024
Resources:
- Illumina, Inc. (ILMN) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Illumina, Inc. (ILMN)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Illumina, Inc. (ILMN)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.