Illumina revenue rises 4.2% to $1.129 billion, raises 2026 outlook
Key Facts
Illumina reported revenue of $1.129 billion for the third quarter on October 29, 2026, up 4.2% year over year, and said results exceeded its guidance. Revenue fell short of analysts’ estimate of $1.15 billion, while growth was also below their forecast of 6.5%, according to estimates published before the results. Diluted earnings per share under accounting standards came to $1.43, beating the estimate of $1.36. Chief Executive Jacob Thaysen said, "Healthy clinical demand and strong NovaSeq X placements drove results above our guidance." He added that the company was raising its full-year revenue and earnings outlook based on continued momentum.
A comparison of reported and adjusted revenue shows the effect of tariff refunds on the quarter’s performance. Revenue was $1.129 billion, compared with $1.084 billion in the corresponding period of 2025, and rose to $1.166 billion excluding the impact of the refunds. Revenue growth was 7.6% on that basis, while organic growth reached 4.8% and fell to 4.7% excluding the impact of Greater China, according to the company’s non-GAAP measures. Illumina estimated a $79 million benefit from the refunds, recorded as a reduction in cost of revenue during the quarter. It also said $37 million of the refunds would be passed on to customers as a reduction in revenue.
Revenue was split between products and services, with both categories higher than a year earlier. Product revenue was $946 million, compared with $927 million in the third quarter of 2025. Services and other revenue came to $183 million, versus $157 million. For the first nine months of the fiscal year, total revenue was $3.380 billion, up from $3.184 billion in the same period of 2025. Quarterly net income rose to $220 million from $150 million, while net income for the nine months was $561 million, compared with $516 million.
Operating margin under accounting standards improved to 27.0% in the third quarter, from 21.0% in the corresponding period a year earlier. The company’s non-GAAP operating margin was 28.8%, but fell to 25.0% excluding the impact of tariff refunds. Diluted earnings per share under accounting standards was $1.43, compared with $0.98 a year earlier. Non-GAAP diluted earnings per share was also $1.44 after excluding tariff refunds. These figures show that the refunds affected some profitability measures as well as cost of revenue.
Cash flow also increased from the corresponding quarter a year earlier. Operating cash flow was $419 million, compared with $284 million. Free cash flow was $378 million, versus $253 million in the same period a year earlier. The results follow the company’s report of second-quarter revenue of $1.16 billion, up 9.5% year over year. Reported revenue growth in the third quarter was slower than in the previous quarter, despite continued year-over-year revenue growth. Management said clinical demand and NovaSeq X placements supported quarterly results.
Illumina raised its fiscal 2026 revenue outlook to $4.64–$4.66 billion, from a previous range of $4.60 to $4.64 billion. It also set its non-GAAP operating margin outlook at 23.6%, compared with a previous range of 23.4% to 23.6%. The company raised its non-GAAP diluted earnings-per-share outlook to $5.40–$5.45. It kept its forecast for organic revenue growth in the rest of the world above 5% unchanged. The company had announced that its third-quarter results call would begin on October 29, 2026, at 1:30 p.m. Pacific time, or 4:30 p.m. Eastern time.