Illumina, Inc. (ILMN) Earnings

metirFinance

Dec 2026upcoming

Next quarter

Expected to report Feb 4, 2027 — estimated from last year’s reporting date.

Consensus is $1.52 EPS for Dec 2026 across 6 estimates, ranging $1.51 to $1.53.

ILMN Sep 2026

Reported Oct 29, 2026 · after the close

: 5.88%
: -18.64%

: $1.36
: $1.44
: —
: $1.13B

Reported results

: $1.13B; from $1.08B
: 73.52%; from 67.62%
: $305.00M; from $227.00M
: 27.02%; from 20.94%
: $220.00M; from $150.00M
: $1.43; from $0.98

Highlights

EPS beat: Non-GAAP diluted EPS excluding tariff refunds was $1.44, 5.9% above the $1.36 consensus; GAAP diluted EPS was $1.43 versus $0.98 a year earlier and $1.35 in Q2.
Revenue growth: Reported Q3 revenue was $1.129 billion, up 4.2% year over year but down from $1.16 billion in Q2; excluding tariff-refund effects, revenue was $1.166 billion.
Clinical and NovaSeq X demand: Illumina placed more than 80 NovaSeq X instruments, bringing placements over the past four quarters to about 360; rest-of-world clinical consumables grew 14%, while research and applied consumables declined 6%.
Guidance raised: FY2026 revenue is now expected at $4.64–$4.66 billion, versus $4.60–$4.64 billion previously, and non-GAAP EPS at $5.40–$5.45, versus $5.30–$5.40.
Margins: GAAP operating margin was 27.0%, versus 21.0% a year ago; non-GAAP operating margin excluding tariff refunds was 25.0%, 100 basis points above guidance.
Tariff accounting: Results included a $79 million expected tariff-refund benefit in cost of revenue and a $37 million reduction to revenue for customer credits, a net $42 million gross-profit benefit.
Cash generation: Operating cash flow was $419 million and free cash flow was $378 million, up from $284 million and $253 million, respectively, a year earlier.
AI and multi-omics: The Billion Cell Atlas was more than halfway complete, GSK joined its consortium, and management expects BioInsight and new products to become more visible in revenue growth during 2027.

Analysis

Illumina delivered a stronger-than-guided quarter, led by clinical sequencing demand and elevated NovaSeq X placements. Non-GAAP diluted EPS excluding tariff refunds of $1.44 exceeded the $1.36 consensus by 5.9%; GAAP diluted EPS was $1.43, up from $0.98 a year ago and $1.35 in Q2. Reported revenue of $1.129 billion rose 4.2% year over year but declined from $1.16 billion sequentially. That sequential comparison is distorted by tariff-related customer credits: revenue excluding their impact was $1.166 billion, approximately flat with Q2.

The core operating picture was improving, though the headline margin benefited from tariff refunds. Rest-of-world organic revenue grew 4.7%; sequencing consumables were up 5% on that basis, with clinical growth of 14% offset by a 6% decline in research and applied markets. Non-GAAP operating margin excluding refunds reached 25.0%, 100 basis points ahead of guidance, while excluding the refund effects gross margin was 69.4%, broadly steady year over year. Illumina raised its FY2026 revenue and EPS ranges, citing Q3 outperformance and stronger expected Q4 consumables sales on a larger NovaSeq X base. Its AI and multi-omics initiatives remain longer-term opportunities rather than the main source of this quarter’s growth.

Underlying results and tariffs

Revenue: Reported revenue was $1.129 billion, up from $1.084 billion a year earlier. It was below Q2’s $1.16 billion, but the company reported $1.166 billion excluding tariff-refund effects, reflecting the $37 million reduction for amounts expected to be credited to customers.
Refund effects: Illumina recognized a $79 million benefit from expected IEEPA tariff refunds as a reduction to cost of revenue and a corresponding $37 million reduction to revenue for customer credits. The net $42 million benefit lifted reported gross profit; excluding tariff refunds, non-GAAP gross margin was 69.4%, versus 69.2% a year earlier.
Earnings and operating margin: GAAP operating income increased to $305 million from $227 million a year ago and was $245 million in Q2. GAAP diluted EPS was $1.43. Non-GAAP EPS excluding tariff refunds was $1.44, versus $1.34 a year ago and $1.35 in Q2; the $1.44 figure was 5.9% above the $1.36 consensus. Non-GAAP operating margin excluding refunds was 25.0%, compared with 24.5% a year earlier and guidance of about 24%.

Clinical and NovaSeq X

Placements and utilization: Illumina placed more than 80 NovaSeq X instruments in Q3 and about 360 over the past four quarters, exceeding placements in the platform’s first year. Management said it saw no evidence of pull-forward demand. High-throughput sequencing output growth on connected instruments remained above 30%.
Consumables demand: Sequencing consumables revenue was $792 million excluding tariff-refund effects, up 6% year over year and 5% on a rest-of-world organic basis. Clinical consumables grew 14% in rest-of-world markets; research and applied consumables declined 6%. Management expects mid-teens clinical growth and mid- to high-single-digit declines in research and applied consumables for 2026.
Platform transition: About 84% of high-throughput volume and 60% of sequencing revenue was on NovaSeq X. The research and applied transition was largely complete, with at least 90% of volume on X for five consecutive quarters; clinical conversion was 78%, with management expecting 80%–85% in coming quarters. It expects X-related year-over-year pricing headwinds to ease in 2027.

Raised 2026 outlook

Full-year ranges: Revenue guidance, excluding tariff refunds, increased to $4.64–$4.66 billion from $4.60–$4.64 billion. Non-GAAP diluted EPS guidance rose to $5.40–$5.45 from $5.30–$5.40, representing expected year-over-year growth of 12%–13%.
Growth and margin assumptions: The company maintained expectations for organic revenue growth above 4% and rest-of-world organic growth above 5%. It now expects a 23.6% non-GAAP operating margin, at the high end of its prior 23.4%–23.6% range.
Q4 setup: Illumina forecast revenue of $1.22–$1.24 billion, rest-of-world organic growth of about 4.5%, non-GAAP EPS of $1.51–$1.56, and operating margin near 25%. Management said the Q4 increase in consumables expectations reflected stronger placements and demand, not an assumed unusual budget flush.

BioInsight and AI data

Management positioned BioInsight and the Billion Cell Atlas as developing growth opportunities, not the primary drivers of Q3. The Atlas was more than halfway complete, GSK joined the consortium, and Illumina said it was converting some backlog into revenue while interest from prospective partners grew. The company frames its opportunity as combining standardized, reproducible datasets with sequencing, multi-omics, software, and AI tools. It launched the BioInsight analysis platform and SpliceAI2; in rare-disease research datasets, SpliceAI2 identified 17% more disease-relevant splice variants than other splicing models. Management expects new products and BioInsight to contribute growth in 2027, with more detail on the financial contribution expected during that year.

Cash flow and capital

Cash generation: Operating cash flow was $419 million and free cash flow was $378 million, compared with $284 million and $253 million, respectively, in Q3 2025. Capital expenditures were $41 million.
Liquidity and debt: Illumina ended the quarter with $1.34 billion in cash, cash equivalents, and short-term investments, $1.79 billion of total debt, and a reported gross-debt leverage ratio of about 1.4 times last-twelve-month EBITDA.
Capital returns: The company repurchased $9 million of stock in Q3 and reported approximately $1.8 billion remaining under its repurchase authorizations.

Illumina, Inc.

Peers