Analyst Conference Summary

conference date: July 30, 2026 @ 1:30 PM Pacific Time
for quarter ending: June 30, 2026 (second quarter, Q2 2026)

Forward-looking statements

Overview: Improved growth rate, raised guidance.

Basic data (GAAP):

Revenue was $1.16 billion, up 6% sequentially from $1.09 billion and up 9% from $1.06 billion in the year-earlier quarter.

Net income was $207 million, up 54% sequentially from $134 million, and down 12% from $235 million year-earlier.

Diluted EPS was $1.35, up 55% sequentially from $0.87, and down 9% from $ year-earlier.

Guidance:

Updated 2026 guidance. total revenue increased to $4.60 to $4.64 billion. Non-GAAP diluted EPS up to $5.30 to $5.40. For Q3 revenue $1.14 to $1.16 billion; Non-GAAP EPS $1.33 to $1.38.

Conference Highlights:

Jacob Thaysen, CEO, said "Illumina delivered strong results during the second quarter. Momentum continued to build through the first half of 2026, as our technology is enabling clinical customers to expand sequencing-intensive applications. Based on this performance, we are increasing our revenue and earnings guidance for the year. Demand for NovaSeq X remains high as we expand our workflow and multiomics capabilities, broadening the value of Illumina's ecosystem... Revenue grew at the fastest pace since I joined the company."

Sales in China were up to $56 million. China lifted the export ban on Illumina sequencers in Q4, but approvals are still required for instrument purchases. Rest of world growth was 8.1% and was broad based.

Expects a return to growth in research and academic markets as funding returns.

In Q2 new whole genome workflow was launched. Lowers costs, runs on NovaSeq. Expanding multinomics platform. Proteonomics acquisitions are proving attractive to customers.

Product revenue was $982 million, services $177 million. $125 million of the product revenue was for instruments, $775 million was for consumables, up 5% y/y. $105 million other revenue. Growth slowed in the Middle East.

Illumina shipped >95 NovaSeq X instruments in Q2 2026. [NovaSeq X is the most powerful and expensive of its sequencers.] New high-volume applications are being built for NovaSeq X. % of clinical volume is now on the X.

Non-GAAP numbers: net income $ million, up % sequentially from $na million, and up % from $na million year-earlier. Diluted EPS was $1.31, up 14% sequentially from $1.15, and up 10% from $1.19 year-earlier.

Cash, equivalents and investment balance was $1.17 billion, down sequentialy from $1.15 billion. $1.99 billion term debt. Cash flow from operations was $201 million. Free cash flow was $162 million. Capital expenditures were $39 million. Cash used to repurchase stock was $122 million.

GAAP cost of revenue was $389 million, leaving gross profit of $770 million. Operating expenses were $525 million, consisting of: $252 million for research and development; $273 million for selling, general, and administration. Leaving income from operations of $245 million. Other income was $15 million. Income tax $53 million.

Q&A selective summary:

Assuming for Nova X installs for 2H? Clinical cliff, 2027? Convinced remarkable growth can continue for years to come. Running over our placements-per-quarter earlier guidance. Clinical cliff has become a wave we are surfing. Committed to high-single digit growth rate for 2027.

Sequential slowdown in consumer consumables? X volume is expanding. Still selling some VIs, but will eventualy change over to X. So not a true headwind. Clinical performance remains high. True 20% growth slowed to 15%, but that is still really strong, impacted by issues in the Middle East.

Slight slowdown in Q3 guidance? Y/y instument compare is a bit difference because Q3 was stronger than Q2 in 2025.

AI releated revenue? These products are ramping up well. Customers are excited about the data generated. We are already making money in this, bottom line.

Seasonality? Q3 is always a bit lower than Q4. Overall underlaying strong trend. Usual seasonality, with Q4 strongest, and includes an extra week, which could help consumables.

Clinical space shift into healthcare is still in front of us, should become standard of care, driving momentum for years to come. US is main driver of growth. Oncology is main application, therapy selection should grow over time.

We are seeing some input cost increases, like the high cost of memory. Our instruments do not use a GPU architecture.

There is still opportunity in the academic research space, which is still about 30% of instrument placings. Not assuming any meaningful improvement in that market the rest of this year.

Margin factors? Some improvement is coming from higher mix of consumables. We are also taking actions to lower costs.

Mid and low throughput instruments? We have the broadest range of instruments in the industry. Lower end has different types of drivers. Mid is more sensative to the macro environment, we still see good placements in that space. We introduced a new low-throughput instrument last year, it is at a cost that labs can afford.

ILMN main page

OpenIcon Analyst Conference Summaries Main Page

Search

More Analyst Conference Pages: