PacBio (NASDAQ: PACB) reported Q2 2026 revenue of $39.0 million, down about 2% from $39.8 million a year earlier, while GAAP diluted net loss per share was $0.14, unchanged year over year. Consumables and Revio placements increased, but lower instrument and service revenue, higher computing costs, and manufacturing transition expenses contributed to weaker gross margins and a wider net loss. PacBio’s full-year 2026 revenue outlook stands at $155 million to $165 million.
Core Financial Results
Revenue remained nearly flat because growth in consumables did not fully offset declines in instrument and service revenue. Lower gross profit was the main operating pressure, although reduced operating expenses kept the GAAP operating loss close to the prior-year level.
| Metric | Q2 2026 | Q2 2025 | Year-over-year change |
|---|---|---|---|
| Revenue | $39.0 million | $39.8 million | Down about 1.9% |
| GAAP gross profit | $12.6 million | $14.7 million | Down about 13.9% |
| GAAP gross margin | 32% | 37% | Down 5 percentage points |
| Non-GAAP gross margin | 36% | 38% | Down 2 percentage points |
| GAAP operating expenses | $57.2 million | $59.5 million | Down about 3.8% |
| GAAP operating loss | $44.6 million | $44.9 million | Narrowed by about $0.2 million |
| GAAP net loss | $44.7 million | $41.9 million | Widened about 6.7% |
| GAAP diluted net loss per share | $0.14 | $0.14 | Unchanged |
| Non-GAAP net loss | $41.9 million | $40.0 million | Widened about 5.0% |
| Non-GAAP net loss per share | $0.14 | $0.13 | Worsened by $0.01 |
Business and Product Performance
The quarter showed a clear divergence within PacBio’s revenue mix. Consumables increased, supported by growing utilization and the rollout of SPRQ-Nx chemistry, while instrument revenue declined despite higher Revio placements.
| Business metric | Q2 2026 | Q2 2025 | Year-over-year change |
|---|---|---|---|
| Consumables revenue | $20.1 million | $18.9 million | Up about 6.3% |
| Instrument revenue | $12.8 million | $14.2 million | Down about 9.9% |
| Service and other revenue | $6.1 million | $6.7 million | Down about 9.4% |
| Revio placements | 20 | 15 | Up about 33.3% |
| Vega placements | 26 | 38 | Down about 31.6% |
| Annualized Revio pull-through per system | About $202,000 | About $219,000 | Down about 7.8% |
PacBio said instrument sales included both single- and multi-system orders, including several Revio systems purchased by a new population-scale customer. The combination of more Revio placements and lower instrument revenue reflects, in part, lower average selling prices associated with strategic multi-system placements. Lower Vega placements also weighed on the instrument category.
The company began the global commercial rollout of SPRQ-Nx, which offers whole-genome sequencing at a $345 list price per genome and includes enhanced methylation detection and the DeepConsensus algorithm. PacBio also commenced sequencing and sample delivery for Basecamp Research, marking an operational milestone for its largest population-scale program to date.
Cost Cuts Stabilized Operating Loss, but Net Loss Widened
GAAP operating expenses declined by approximately $2.3 million, enough to offset most of the $2.0 million decrease in gross profit. As a result, PacBio’s GAAP operating loss narrowed slightly to $44.6 million even though gross margin fell substantially.
That operating stability did not carry through to the bottom line. Other income declined to $2.0 million from $4.7 million, while interest expense increased to $2.1 million from $1.7 million. These below-the-line changes contributed to the widening of GAAP net loss to $44.7 million.
On a non-GAAP basis, gross-margin pressure was attributed primarily to higher compute and memory costs, Vega manufacturing transition costs, and lower Revio average selling prices on strategic multi-system placements. Non-GAAP operating expenses declined to $56.1 million, but the cost reduction was not enough to prevent the non-GAAP net loss from increasing.
Liquidity and Balance Sheet
Cash, cash equivalents, and investments totaled $236.9 million at June 30, 2026, down $42.6 million from $279.5 million at the end of 2025. Inventory increased by $11.8 million over the same period to $61.1 million, even as quarterly revenue remained nearly unchanged year over year.
PacBio reported $644.3 million of convertible senior notes and a stockholders’ deficit of $33.2 million at quarter-end, compared with positive equity of $5.3 million at December 31, 2025. Continued net losses, the decline in cash and investments, and higher inventory make the company’s liquidity trajectory and working-capital management important areas to monitor.
2026 Financial Outlook
PacBio expects full-year 2026 revenue between $155 million and $165 million. With first-half revenue of $76.2 million, the outlook implies approximately $78.8 million to $88.8 million of revenue during the second half.
| Metric | FY2026 outlook |
|---|---|
| Full-year revenue | $155 million to $165 million |
| Implied second-half revenue | Approximately $78.8 million to $88.8 million |
Reaching the range will therefore require second-half revenue to exceed the first-half total, with execution around SPRQ-Nx, new system placements, consumables utilization, and population-scale programs likely to be relevant.
Recent Insider Transactions
The supplied six-month summary reports 1,955,879 shares purchased across six transactions and 817,896 shares sold across seven transactions, resulting in net purchases of 1,137,983 shares. It also reports total insider holdings of 27.23 million shares and net purchases equal to 4.40% of those holdings.
The latest 10 reported records consist of six zero-price stock awards and four sales with an aggregate reported value of $154,090. These awards and sales are different transaction types and should not be interpreted as equivalent indicators of insider sentiment.
| Date | Insider and role | Transaction | Price per share | Reported value |
|---|---|---|---|---|
| 2026-04-08 | Christopher C. Gibson, Director | Stock award | $0.00 | $0 |
| 2026-04-01 | James R. Gibson II, CFO | Sale | $1.37 | $120,813 |
| 2026-03-03 | Christopher C. Gibson, Director | Stock award | $0.00 | $0 |
| 2026-03-03 | Christian O. Henry, CEO | Sale | $1.51 | $18,920 |
| 2026-03-03 | Mark D. Van Oene, COO | Sale | $1.51 | $9,847 |
| 2026-03-03 | Michele Farmer, Officer | Sale | $1.51 | $4,510 |
| 2026-02-27 | Mark D. Van Oene, COO | Stock award | $0.00 | $0 |
| 2026-02-27 | Michele Farmer, Officer | Stock award | $0.00 | $0 |
| 2026-02-27 | Christian O. Henry, CEO | Stock award | $0.00 | $0 |
| 2026-02-27 | James R. Gibson II, CFO | Stock award | $0.00 | $0 |
Risks Investors Should Monitor
- Gross-margin pressure: Higher compute and memory costs, Vega manufacturing transition expenses, and discounted Revio multi-system placements could continue to constrain profitability.
- Instrument and placement volatility: Instrument revenue declined despite more Revio placements, while Vega placements fell from 38 to 26. PacBio also cautioned that reported system orders should not be considered an indication of future performance.
- Liquidity and capital structure: Cash and investments declined during the first half, while the company remained loss-making and carried $644.3 million of convertible senior notes.
- Second-half execution: The full-year outlook requires approximately $78.8 million to $88.8 million of second-half revenue, compared with $76.2 million generated in the first half.
- Inventory expansion: Inventory increased about 24% from year-end while quarterly revenue was nearly flat, raising the importance of product demand, manufacturing execution, and inventory conversion.
Summary
PacBio’s Q2 2026 results showed improving consumables revenue and higher Revio placements, but those gains did not offset weaker instrument and service revenue or rising production-related costs. Expense reductions kept the operating loss broadly stable, while lower other income and higher interest expense contributed to a wider net loss. The next major tests are whether SPRQ-Nx and population-scale programs can support the second-half revenue required by guidance and whether PacBio can stabilize margins while preserving liquidity.
Find out more
Comments