Illumina Raises Full-Year Outlook After Rest-Of-World Growth

The Tip Desk · July 30, 2026 · 4 min read

Rest-of-world organic revenue growth reached 8.1% in the second quarter, and the company now expects that pace to exceed 5% for the full year.

Illumina, Inc. (ILMN) reported second-quarter revenue of $1.16 billion, up 9.5% from a year earlier, and lifted its full-year 2026 outlook after rest-of-world organic growth accelerated from the first quarter.

The DNA-sequencing company reported growth of 4.8% in the first quarter. Rest-of-world organic revenue growth, which excludes currency, acquisitions and China, was 8.1% in the second quarter, compared with 3.5% in the first.

Chief Executive Officer Jacob Thaysen said momentum continued to build through the first half of 2026 as technology enabled clinical customers to expand sequencing-intensive applications, and that demand for NovaSeq X remained high as the company expanded workflow and multiomics capabilities.

GAAP operating margin was 21.1%, up from 19.2% in the first quarter. Non-GAAP operating margin was 22.5%. GAAP diluted earnings were $1.35 a share. Non-GAAP diluted earnings were $1.31 a share.

Product revenue was $982 million. Service and other revenue was $177 million. GAAP gross margin was 66.4%. Non-GAAP gross margin was 68.2%. Research and development expense was $252 million. Selling, general and administrative expense was $273 million. Net income was $207 million.

Cash flow provided by operations was $201 million. Free cash flow was $162 million after $39 million of capital expenditures for free cash flow purposes. The company held $1.17 billion in cash, cash equivalents and short-term investments at quarter-end.

For fiscal 2026, Illumina now expects total revenue of $4.60 billion to $4.64 billion, versus prior guidance of $4.52 billion to $4.62 billion. It now expects rest-of-world organic revenue growth greater than 5%, versus prior guidance of 2% to 4%. Non-GAAP diluted earnings guidance is $5.30 to $5.40 a share, versus $5.15 to $5.30. Non-GAAP operating margin guidance is unchanged at 23.4% to 23.6%.

The company had already raised full-year revenue and earnings guidance after the first quarter, when it lifted the revenue range to $4.52 billion to $4.62 billion and non-GAAP diluted earnings to $5.15 to $5.30 a share. Rest-of-world organic growth guidance then remained 2% to 4%. The second-quarter update moved that organic-growth range higher and added $20 million at the top of the revenue band.

Thaysen framed the second-quarter print as a continuation of first-half momentum in clinical sequencing-intensive applications and as evidence that NovaSeq X demand remained high as the company broadened workflow and multiomics capabilities. The company is increasing revenue and earnings guidance for the year based on that performance.

GAAP operating profit was $245 million. Non-GAAP operating profit was $260 million. Diluted shares used in computing earnings were 153 million.

Inventory, net, was $629 million at June 28, 2026. Accounts receivable, net, were $764 million. Term debt, current portion, was $500 million. Long-term term debt was $1,491 million. Stockholders’ equity was $2,838 million.

Rest-of-world organic revenue growth excludes the Greater China region because of its inclusion on China’s Unreliable Entities List. Organic revenue growth adjusts for acquisitions and currency.

Non-GAAP diluted earnings of $1.31 a share excluded acquisition-related costs of $0.07 a share, transformational initiatives of $0.03 a share, a $0.15 a share strategic-investment gain, and a $0.01 a share tax adjustment. GAAP diluted earnings of $1.35 a share included those items.

Transformational-initiative costs in the quarter consisted primarily of implementation costs to upgrade the company’s ERP system. Acquisition-related costs included amortization of intangible assets, inventory fair-value step-up for SomaLogic, expenses for the SomaLogic and GRAIL acquisitions, and net gains on contingent consideration liabilities.

Illumina is a global leader in DNA sequencing and array-based technologies, serving customers in research, clinical and applied markets, with products used in life sciences, oncology, reproductive health, agriculture and other emerging segments.

The company will not update forward-looking statements or provide interim reports on the progress of the current quarter.