Release Date: April 30, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Could you give us some insight into the adoption trends and early feedback on HD and GEM-X? How many of your CytAssist customers have purchased HD at this point? And how do you think about that driving sustained demand for CytAssist this year and then similarly, adoption rates among the existing customers on GEM-X?
A: Justin J. McAnear, CFO of 10x Genomics, noted that roughly half of the Visium consumables are now HD, and about one-third of Chromium consumables are on GEM-X as of Q2. The launch of HD has driven sustained demand for CytAssist, and GEM-X is expected to drive Chromium iX placements throughout 2024. Serge Saxonov, CEO, added that feedback on both HD and GEM-X has been very positive, with substantial performance improvements noted at a lower price.
Q: Can you give us some sense of visibility into what the growth trajectory looks like for single-cell Chromium for the year?
A: Justin J. McAnear explained that the transition to GEM-X and increased interest in spatial technologies are impacting single-cell revenue. He anticipates similar impacts in Q2 as seen in Q1, with a sequential revenue increase of about 7-8% from Q1 to Q2. The transition to GEM-X is expected to smooth out by the end of the year.
Q: Where is the confidence in understanding the timelines associated with the validation for GEM-X? How would you compare it to other processes for your other single-cell kits?
A: Serge Saxonov stated that the transition to GEM-X should be relatively quick as it is a straight-up replacement offering multiple advantages with little trade-offs and at a lower price. He expects rapid adoption once customers validate the performance with their samples.
Q: Given the results in Q1, do you still expect Chromium revenues to grow this year?
A: Justin J. McAnear acknowledged that achieving growth in Chromium revenues is now more challenging. The guidance incorporates more spatial upside and more Chromium downside. By the end of the year, the impacts of the GEM-X transition are expected to stabilize.
Q: How is the emergence of Bruker as a direct competitor changing how you budget and tactically plan?
A: Serge Saxonov remarked that the spatial field is very attractive and competitive. 10x Genomics continues to focus on product innovation and quality to maintain leadership in the market.
Q: Can you provide any initial color on the status of the strategy in China given that inventory is piling up, created some obstacles last year, how did 1Q fare?
A: Justin J. McAnear explained that they have worked to bring down inventory levels at distributors and service providers in China. They have developed closer relationships and added distributors to reduce burden and get closer to customers. The situation in Q1 played out as expected without the issues seen last year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.