10X Genomics (TXG) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue was $151.7 million, down 1% year-over-year, mainly due to lower instrument sales, partially offset by higher consumables revenue; net loss was $35.8 million, a significant improvement from $93 million last year.

• Major commercial reorganization was implemented, including specialized teams and territory realignment, with over 40% of Americas accounts changing sales coverage, leading to greater-than-anticipated disruption.

• Launched new products: GEM-X Flex, GEM-X Universal Multiplex, and Chromium Xo, offering up to 2x more genes detected, 2x throughput, and >2x cost reduction per cell, aimed at reducing cost barriers and expanding market access.

• Spatial consumables revenue saw strong growth, driven by Visium HD and Xenium 5K adoption, while instrument sales, especially Xenium, were pressured by macro headwinds.

• Appointment of new CFO, Adam Taich, in August 2024.

Financial highlights

• Q3 2024 revenue: $151.7 million (down 1% year-over-year); nine months revenue: $445.8 million (up 3%).

• Consumables revenue: $126.2 million, up 10%; Chromium consumables down 4%, spatial consumables up 111%.

• Instrument revenue: $19.1 million, down 45%; Chromium instruments down 38%, spatial instruments down 50%.

• Gross margin: 70% in Q3 2024, up from 62% in Q3 2023.

• Operating loss: $41.5 million, improved from $94.8 million loss last year; net loss per share: $(0.30).

• Cash and cash equivalents: $398.2 million as of September 30, 2024.

Outlook and guidance

• Full-year 2024 revenue guidance: $595–$605 million, a 3% decline from 2023 at midpoint; Q4 revenue expected to be flat sequentially.

• Ongoing headwinds expected from commercial restructuring and macroeconomic pressures into next year.

• Price reductions in Chromium expected to be offset by volume growth over 3–4 quarters.

• Commercial organization expected to be fully ramped by mid-2025.

• Gross margin expected to fluctuate due to product mix and royalty obligations.