This call is being recorded and the audio portion will be archived in the Investors section of our Web site.It is our intent that all forward-looking statements regarding our expected financial results and commercial activity made during today’s call will be protected under the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties. Actual events or results may differ materially from those projected or discussed. All forward-looking statements are based upon current information available and Illumina assumes no obligation to update these statements. To better understand the risks and uncertainties that could cause results to differ, we refer you to the documents that Illumina files with the Securities and Exchange Commission, including Forms 10-Q and 10-K. Before I turn the call over to Christian, I want to let you know that we will participate in the Morgan Stanley Global Healthcare Conference in New York on September 13 and 14 and the UBS Global Life Sciences Conference on September 21 and 22, also in New York. For those of you unable to attend any of the upcoming conferences, we encourage you to listen to the webcast presentations, which will be available through the Investor Relations section of our Web site. With that, I’ll now turn the call over to Christian. Christian Henry Good afternoon, everyone, and thank you for joining us today. During today’s call, I’ll review our second quarter financial results and update our guidance for the remainder of the year; Jay will then provide an update of our commercial progress and the state of our business and markets. In the second quarter, we recorded $212 million in total revenue. This represents growth of 31% over the second quarter of last year. Product revenue was $199 million, growing 30% over the prior year period, led by significant growth in our sequencing products. Our microarray business also grew relative to Q2 2009 and was up sequentially for the third consecutive quarter.
Consumable revenue for the quarter was $126 million compared to $97 million in Q2 of 2009. We saw a strong demand for both sequencing and microarray consumables, resulting in year-over-year growth of 30%.Annualized consumable pull-through per sequencing system was at the high end of our projected range of 150,000 to 200,000 per system. Additionally, across our installed base of microarray scanners, annualized consumables pull-through was above our targeted range of 400,000 to 500,000 per system. Total instrument revenue for the quarter $70 million, up 30% compared to $54 million in the second quarter of last year and up 22% compared to $57 million last year. In both cases, the growth in instrument revenue is attributable to the success with our HiSeq 2000. HiSeq demand has vastly exceeded our initial expectations. To this demand we significantly increased our production in the second quarter, exceeding our original unit goals. In addition, we intend to increase the number HiSeqs produced by more than 50% in the third quarter. The growth in sequencing instrument revenue was slightly offset by microarray instrument revenue, which declined year-over-year and sequentially from a strong Q1. Even though revenue was down sequentially, orders from microarray instrumentation were up strongly, both sequentially and year-over-year. Services and other revenue, which includes genotyping and sequencing services as well as instrument maintenance contracts, was $13 million compared to $8 million in Q2 of last year. The primary driver of the year-over-year growth was the increase in maintenance contracts associated with our growing installed basis of sequencing systems. Before discussing our gross margins and operating expenses for the quarter, I would like to note that we recorded a pre-tax amount of $17 million related to non-cash stock-based compensation. This impacted our EPS by a tax-adjusted adjusted amount of $0.08 per pro forma diluted share for the quarter. I want to remind you that we now include this expense in our presentation of pro forma net income and earnings per share.
However, in our discussion of gross margin, operating expenses and operating margin, I will highlight both our GAAP expenses, which includes stock compensation expense and other non-cash charges and the corresponding non-GAAP figures. I encourage you to review the GAAP reconciliation of our non-GAAP measures included in today’s earnings release.Total cost of revenue for the quarter was $66 million compared to $50 million in Q2 of 2009. The Q2 2010 cost includes stock-based comp expense of $1.4 million compared to $1.3 million in the prior year period. Read the rest of this transcript for free on seekingalpha.com