
10x Genomics Shows Strong Momentum With Xenium Spatial Biology Platform Overcoming China and Macro Headwinds
11-3-23 (by: Scott Gleason) 10x Genomics has reported financial results for the third quarter of 2023 with total revenue of $153.6 million increasing 17% year-over-year. Street forecasts had expected revenue of $151.3 million. The company highlighted the strong growth of its Xenium spatial biology platform. The Xenium platform enables the characterization of hundreds to thousands of RNAs and multiplexed proteins within cells and tissues with the capability to achieve subcellular in situ resolution, all within the same tissue section. Management did note the impact of headwinds in China and excluding China the company grew 20% in the quarter. The company wouldn’t comment on its pending litigation with spatial biology competitor NanoString but the U.S. trial is scheduled to begin shortly.
With Xenium, the company noted it surpassed 100 commercial placements in August, and recently launched its custom 480-plex gene expression product. Furthermore it plans to offer 5,000 plex panels in mouse and human tissue that run in days in mid-2024.
Because of China headwinds, the company’s Chromium single cell analysis platform revenues were flat in the quarter on a year-over-year basis with system revenues declining and consumables up modestly. Management noted that growth in the North American and Europe was in the low-teens. The company highlighted the launch of its new high-throughput Feature Barcode multiomic profiling kit which allows simultaneous analysis of gene expression and protein targets in a single experiment at a lower price point. The company also recently partnered with Beckman Coulter to improve its single cell workflow automation.
Despite strong revenue growth, 10x Genomics observed some changes in its profitability. Gross margin for the third quarter of 2023 was 62%, compared to 77% for the same period in the previous year. The decrease was driven by mix shifts with a large number of Xenium instrument placements which have a lower gross margin. Operating loss for the third quarter of 2023 was $94.8 million, compared to $40.0 million for the same period in the previous year.
Looking ahead, 10x Genomics has revised its full-year 2023 revenue guidance, projecting revenue in the range of $610 million to $625 million. This increased guidance reflects an expected growth of 18% to 21% over the full year 2022.
Serge Saxonov, Co-founder and CEO of 10x Genomics, expressed the company’s excitement about the Xenium platform’s rapid growth and highlighted the immense customer enthusiasm and demand for Xenium. The achievements underscore the company’s commitment to spatial biology and validate its investment in a multi-platform strategy.