A constructing on the campus of Illumina World Headquarters in San Diego, California on September 1, 2021.
Mike Blake | Reuters
Illumina on Tuesday exposed plans to cut costs to improve shrinking margins for the DNA sequencing company.
The plans aim to reduce Illumina’s annual expenses by greater than $100 million starting later this yr, according to the company’s first-quarter earnings release.
The corporate posted gross margins of 60.3% during the period, compared to 66.6% in the prior-year period.
“These savings will speed up progress towards higher margins in addition to freeing up capital to increase investment in high-growth areas,” Illumina said in a release.
Amongst the Illumina’s plans is to exploit her NovaSeq X sequencing system speed up genomic discoveries. The system, which went live in September 2022, sequences DNA twice as fast and 3 times as accurately as previous Illumina products.
The San Diego-based company said it also plans to lower your expenses by “enabling operations” in more profitable areas around the world. Illumina has not released any details about these activities.
The corporate is battling criticism and a falling market capitalization after its controversial $7.1 billion acquisition of Grail, a maker of cancer tests.
Illumina’s market value has fallen to around $34.5 billion from around $75 billion in August 2021. acquisition grail.
The antimonopoly supervision authorities repeatedly appealed against this agreement.
The Federal Trade Commission earlier this month ordered Illumina to divest the acquisition, saying it could stifle competition and innovation.
Last yr, the European Commission, the European Union’s executive body, blocked the deal over similar concerns.
Illumina is appealing each orders and expects final decisions in late 2023 or early 2024.
The Grail deal can also be the subject of a proxy fight between activist-investor Carl Icahn and Illumina. They have been trading stabs for over a month.
Icahn, who owns 1.4% of the company, is in search of seats on Illumina’s board of directors and is pushing for her to terminate the Grail deal. It also calls on Illumina to “immediately” remove its CEO Francis deSouza.
The corporate is urging shareholders to reject three candidates for Icahn’s board during its term annual shareholders’ meeting twenty fifth of May .
Illumina has repeatedly claimed that the Grail has “huge long-term value creation potential.”
grail claims offer the only early screening test on the market that may detect greater than 50 types of cancer with a single blood draw.
The cancer test generated about $55 million in revenue in 2022 and is anticipated to raise up to $110 million this yr, Illumina said.