Illumina Reports 3% Revenue Decline to $4.37 Billion for Fiscal Year 2024

Illumina, Inc. reported a decrease in revenue for the fiscal year ended December 29, 2024, with total revenue of $4.37 billion, down 3% from $4.50 billion in 2023. The decline was primarily attributed to a significant drop in sequencing instrument sales, which fell by 29% to $501 million, reflecting fewer shipments of high-throughput and mid-throughput instruments. In contrast, revenue from consumables increased by 2% to $3.17 billion, driven by higher sales of NovaSeq X consumables. The company's gross profit margin improved to 65.4%, up from 60.9% in the previous year, largely due to operational excellence initiatives that reduced costs and a favorable revenue mix.

The company experienced a loss from operations of $833 million, a slight improvement from a loss of $1.07 billion in 2023. This reduction was influenced by a decrease in operating expenses, which fell by 3% to $3.69 billion, aided by a significant legal contingency gain of $481 million following the withdrawal of a fine by the European Commission. However, Illumina recorded a substantial goodwill and intangible asset impairment of $1.89 billion, primarily related to the GRAIL business, which was spun off in June 2024. The effective tax rate for the year was -3.8%, reflecting the impact of non-deductible goodwill impairment.

Strategically, Illumina completed the spin-off of GRAIL on June 24, 2024, distributing approximately 85.5% of GRAIL's shares to its stockholders. This move was part of a broader strategy to streamline operations and focus on core sequencing technologies. Following the spin-off, Illumina retained a 14.5% stake in GRAIL. The company also launched new products, including the NovaSeq X Plus and MiSeq i100 series, aimed at enhancing its sequencing capabilities and market presence.

Operationally, Illumina's global workforce stood at approximately 8,970 employees as of December 29, 2024, with a voluntary turnover rate of 7%. The company reported that international sales accounted for 48% of total revenue, with significant contributions from the Americas and Europe. The backlog of orders was $657 million, with 78% expected to be shipped in 2025. Looking ahead, Illumina anticipates continued challenges from macroeconomic factors, including inflation and geopolitical tensions, particularly in China, where it was recently added to a list of unreliable entities by the Ministry of Commerce.

In its outlook, Illumina emphasized a commitment to operational excellence and cost reduction initiatives to enhance profitability and return to revenue growth in 2025. The company plans to leverage its strong cash position, which totaled $1.22 billion at year-end, to support ongoing investments in research and development and strategic acquisitions.