Pacific Biosciences (PACB) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue was $37.2M, down from $38.8M in Q1 2024, with record consumables growth offsetting lower instrument sales due to academic funding headwinds and macroeconomic uncertainty.

• Company initiated a major restructuring in April 2025 to focus on long-read sequencing, reduce annualized non-GAAP operating expenses by $45–$50M, and pause high-throughput short-read development.

• Strategic focus is on expanding HiFi sequencing adoption, innovation in long-read platforms, and clinical market penetration.

• SPRQ chemistry rollout and deep learning models improved Revio performance and enabled new clinical applications.

• Macro headwinds include new US-China tariffs and NIH budget risks, prompting a $5M reduction to the lower end of 2025 revenue guidance.

Financial highlights

• Q1 2025 revenue: $37.2M; instrument revenue: $11.0M (-42% y/y); consumables: $20.1M (+26% y/y, record); service and other revenue: $6.0M (+59% y/y).

• Non-GAAP gross margin: 40% (up from 33% in Q1 2024); GAAP gross margin: (3.7)%, impacted by $12M restructuring charges and higher amortization.

• Non-GAAP net loss: $44.4M ($0.15/share), improved from $71.4M ($0.26/share) in Q1 2024; GAAP net loss: $426.1M ($1.44/share), driven by $381.8M in restructuring and $359.3M in accelerated amortization.

• Non-GAAP operating expenses: $61.7M in Q1 2025, down 29% year-over-year.

• Cash and investments: $343.1M at quarter end, down from $561.9M a year ago.

Outlook and guidance

• Full-year 2025 revenue guidance: $150–$170M, midpoint implies ~4% growth over 2024; Q2 2025 revenue expected to be flat sequentially.

• Guidance lowered by $5M at the low end due to China tariffs and NIH funding uncertainty.

• Non-GAAP operating expenses expected to decline 14–17% year-over-year to $240–$250M.

• 2025 non-GAAP gross margin expected between 35–40%, exiting the year above 40%.

• Cash burn for 2025 projected at $115M (excluding $5M license payment), with goal to be cash flow positive by end of 2027.