Shares of Illumina plunged 25% in early trading on Tuesday after the company announced preliminary third-quarter results that missed both its earlier guidance and what analysts were expecting.
The biotech company said after the market close on Monday that it earned about $607 million in revenue last quarter, while analysts had forecast $628.2 million, according to Bloomberg. The company had estimated revenue of between $625 million to $630 million.
“The shortfall in quarterly revenue was driven by a larger than anticipated year-over-year decline in high throughput sequencing instruments,” the company said in a statement.
Illumina’s machines are used for genetic testing and are seeing lower market demand. The company now expects fourth-quarter revenue to be either unchanged from the same period a year ago or just a little higher.
“The miss follows an unusual streak of weakness for Illumina, as the company looks to leverage its expertise with research customers into clinical settings,” said Jack Meehan, an analyst at Citi, in a note on Tuesday.
“Illumina has now preannounced misses 3 of the last 5 quarters. This also follows the unexpected retirement of CEO Jay Flatley in March 2016, with then President Francis DeSouza stepping up to the helm of the company.”
Shares of Pacific Biosciences of California, a competitor, fell nearly 4% in early trading.
This chart shows the plunge in Illumina shares on Tuesday: