Affymetrix, Inc., (NASDAQ:AFFX) today reported its operating
results for the first quarter of 2010. Total revenue for the
quarter was $80.2 million, as compared to total revenue of $78.6
million in the first quarter of 2009.
For the first quarter of 2010, product revenue was $73.4
million, service revenue was $4.5 million, and royalties and other
revenue were $2.3 million. This compares to first quarter 2009
product revenue of $64.9 million, service revenue of $11.6 million,
and royalties and other revenue of $2.1 million. Affymetrix shipped
40 systems in the first quarter of 2010.
The Company reported a net loss of approximately $9.6 million,
or $0.14 per diluted share, in the first quarter of 2010 which
included an impairment charge of $4.9 million, or $0.07 per diluted
share, on a nonmarketable investment. This compares to net loss of
$25.2 million, or $0.37 per diluted share, in the same period of
2009 which included a pretax restructuring charge of $2.0 million,
or $0.03 per diluted share.
For the first quarter of 2010, cost of product sales was $28.5
million compared to $34.4 million in the same period of 2009, which
included $4.6 million of manufacturing consolidated-related costs.
Cost of services and other was $4.6 million compared to $7.6
million in the same period of 2009.
Product gross margin was 61.3 percent, as compared to 47.0
percent in the same period of 2009.
For the first quarter of 2010, operating expenses were $49.9
million as compared to operating expenses of $57.2 million, which
included restructuring charges of $2.0 million, in the first
quarter of 2009.
“Fiscal 2010 is off to a good start,” stated Kevin King,
President and CEO. “In the first quarter we generated double-digit
growth in product revenue, achieved significant year over year
improvements to our operating model and generated a positive
operating cash flow for the quarter.”
Quarterly
Highlights
- In March, the Company announced
the launch of the GeneAtlas™ System, a complete, personal solution
for processing Affymetrix arrays and characterizing changes in gene
expression in a variety of research applications. The system is
compact, affordable and easy to use, making array-based gene
expression technology more accessible than ever before.
- The Company appointed Jami Dover
Nachtsheim and Nelson C. Chan to the board of directors, effective
March 8, 2010. The board appointed Ms. Nachtsheim to the
Compensation Committee and Mr. Chan to the Audit Committee.
- The Company appointed Timothy
Barabe as Executive Vice President and Chief Financial Officer. Mr.
Barabe will lead the Company’s financial functions as well as the
treasury, investor relations, and information technology
departments, reporting to Kevin King.
- Affymetrix and The Jackson
Laboratory announced the full commercial launch of the Affymetrix®
Mouse Diversity Genotyping Array. This is the first high-density
genotyping array that enables researchers to study the complexity
of the mouse genome and the diversity among mouse strains. Because
mice and humans share genomes of similar size, content, and
organization, mice studies are a fundamental component of human
health research.
Affymetrix's management team will host a conference call on
April 21, 2010 at 2:00 p.m. PT to review its operating results for
the first quarter of 2010. A live webcast can be accessed by
visiting the Investor Relations section of the Company’s website at
www.affymetrix.com. In addition, investors and other interested
parties can listen by dialing domestic: (866) 500-AFFX,
international: (706) 643-2771.
A replay of this call will be available from 5:00 p.m. PT on
April 21, 2010 until 8:00 p.m. PT on April 28, 2010 at the
following numbers: domestic: (800) 642-1687, international: (706)
645-9291. The passcode for both replays is 69103813. An archived
webcast of the conference call will be available under the Investor
Relations section of the Company's website.
About
Affymetrix
Affymetrix technology is used by the world's top pharmaceutical,
diagnostic, and biotechnology companies, as well as leading
academic, government, and nonprofit research institutes. More than
1,900 systems have been shipped around the world and more than
21,000 peer-reviewed papers have been published using the
technology. Affymetrix is headquartered in Santa Clara, Calif., and
has manufacturing facilities in Cleveland, Ohio, and Singapore. The
Company has about 1,000 employees worldwide and maintains sales and
distribution operations across Europe and Asia. For more
information about Affymetrix, please visit the Company's
website.
All statements in this press release that are not historical are
"forward-looking statements" within the meaning of Section 21E of
the Securities Exchange Act as amended, including statements
regarding Affymetrix' "expectations," "beliefs," "hopes,"
"intentions," "strategies" or the like. Such statements are subject
to risks and uncertainties that could cause actual results to
differ materially for Affymetrix from those projected, including,
but not limited to: risk relating to the Company’s ability to
successfully commercialize new products, risk relating to past and
future acquisitions, including the ability of the Company to
successfully integrate such acquisitions into its existing
business; risks of the Company's ability to achieve and sustain
higher levels of revenue, higher gross margins and reduced
operating expenses; uncertainties relating to technological
approaches, risks associated with manufacturing and product
development; personnel retention; uncertainties relating to cost
and pricing of Affymetrix products; dependence on collaborative
partners; uncertainties relating to sole-source suppliers;
uncertainties relating to FDA and other regulatory approvals;
competition; risks relating to intellectual property of others and
the uncertainties of patent protection and litigation. These and
other risk factors are discussed in Affymetrix' Annual Report on
Form 10-K for the year ended December 31, 2009, and other SEC
reports, including its Quarterly Reports on Form 10-Q for
subsequent quarterly periods. Affymetrix expressly disclaims any
obligation or undertaking to release publicly any updates or
revisions to any forward-looking statements contained herein to
reflect any change in Affymetrix' expectations with regard thereto
or any change in events, conditions or circumstances on which any
such statements are based.
PLEASE NOTE:
Affymetrix, the Affymetrix logo, GeneChip, and all other
trademarks are the property of Affymetrix, Inc.
- Financial Charts to Follow -
AFFYMETRIX, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(IN THOUSANDS)
(UNAUDITED)
March 31,2010 December
31,2009 ASSETS: (Note 1) Current assets: Cash and
cash equivalents $ 75,771 $ 65,642 Restricted cash—short-term
portion 1,591 1,686
Available-for-sale
securities—short-term portion
225,588 213,377 Accounts receivable, net 58,140 64,933 Inventories
56,226 54,490 Deferred tax assets—current portion 1,216 1,172
Prepaid expenses and other current assets 14,738
15,903 Total current assets 433,270 417,203
Available-for-sale securities—long-term portion 43,493 64,760
Property and equipment, net 67,034 68,182 Acquired technology
rights, net 47,019 49,855 Deferred tax assets—long-term portion
4,731 4,720 Restricted cash—long-term portion 1,109 1,109 Other
assets 15,552 25,121 Total assets $
612,208 $ 630,950
LIABILITIES AND
STOCKHOLDERS’ EQUITY: Current liabilities: Accounts payable and
accrued liabilities $ 47,845 $ 57,183 Deferred revenue—current
portion 13,321 14,534 Total current
liabilities 61,166 71,717 Deferred revenue—long-term portion 4,233
3,898 Other long-term liabilities 11,665 10,295 Convertible notes
247,201 247,201 Stockholders’ equity: Common stock 708 710
Additional paid-in capital 735,239 733,378 Accumulated other
comprehensive income 1,916 4,051 Accumulated deficit
(449,920 ) (440,300 ) Total stockholders’ equity
287,943 297,839 Total liabilities and
stockholders’ equity $ 612,208 $ 630,950
Note 1: The condensed
consolidated balance sheet at December 31, 2009 has been
derived from the audited consolidated financial statements at that
date included in the Company’s Annual Report on Form 10-K for
the fiscal year ended December 31, 2009.
AFFYMETRIX, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE
AMOUNTS)
(UNAUDITED)
Three Months Ended March 31, 2010
2009 REVENUE: Product sales $ 73,443 $ 64,870
Services 4,463 11,556 Royalties and other revenue 2,281
2,135 Total revenue 80,187
78,561
COSTS AND EXPENSES: Cost of product
sales 28,459 34,434 Cost of services and other 4,589 7,590 Research
and development 18,479 21,283 Selling, general and administrative
31,379 33,982 Restructuring charges - 1,967
Total costs and expenses 82,906 99,256
Loss from operations (2,719 ) (20,695 ) Interest income and
other, net (3,598 ) (840 ) Interest expense 2,432
3,177 Loss before income taxes (8,749 ) (24,712 )
Income tax provision 871 493 Net loss $
(9,620 ) $ (25,205 ) Basic and diluted net loss per common
share $ (0.14 ) $ (0.37 )
Shares used in computing basic and
diluted net loss percommon share
67,889 68,617
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