Illumina Reports Strong Start To Fiscal Year 2014

Illumina, Inc. (NASDAQ:ILMN) today announced its financial results for the first quarter of 2014.

First quarter 2014 results:
  • Revenue of $421 million, a 27% increase compared to $331 million in the first quarter of 2013
  • GAAP net income for the quarter of $60 million, or $0.40 per diluted share, compared to net loss of $23 million, or $0.18 per diluted share, for the first quarter of 2013
  • Non-GAAP net income for the quarter of $80 million, or $0.53 per diluted share, compared to $63 million, or $0.46 per diluted share, for the first quarter of 2013 (see the table entitled “Itemized Reconciliation Between GAAP and Non-GAAP Net Income (Loss)” for a reconciliation of these GAAP and non-GAAP financial measures)
  • Cash flow from operations of $37 million and free cash flow of $18 million for the quarter

Gross margin in the first quarter of 2014 was 66.1% compared to 66.3% in the prior year period. Excluding the effect of non-cash charges associated with stock compensation, amortization of acquired intangible assets, legal contingencies, and inventory revaluation adjustments, non-GAAP gross margin was 70.4% for the first quarter of 2014 compared to 69.2% in the prior year period.

Research and development (R&D) expenses for the first quarter of 2014 were $77.0 million compared to $61.5 million in the prior year period. R&D expenses included $11.7 million and $8.0 million of non-cash stock compensation expense in the first quarters of 2014 and 2013, respectively. Excluding these charges and contingent compensation, R&D expenses as a percentage of revenue were 15.5% compared to 16.0% in the prior year period.

Selling, general and administrative (SG&A) expenses for the first quarter of 2014 were $109.6 million compared to $85.1 million in the prior year period. SG&A expenses included $19.4 million and $14.6 million of non-cash stock compensation expense in the first quarters of 2014 and 2013, respectively. Excluding these charges, amortization of acquired intangible assets and contingent compensation, SG&A expenses as a percentage of revenue were 19.9%, flat compared to the prior year period.

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