10x Genomics Q2 Earnings & Revenues Beat Estimates, Gross Margin Up

Shares of TXG lost 5% in yesterday’s after-market trading. The company’s shares have surged 194% in the year-to-date period against the industry’s decrease of 6.5%. However, the broader S&P 500 Index has increased 12.4% in the same time frame.

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TXG's Consumables Business Maintains Momentum

Products and services revenues totaled $149.1 million, up 2.7% year over year. Total consumables revenues were $130.8 million, with Single Cell consumables increasing 3.1% year over year to $88.5 million and Spatial consumables rising 16.2% to $42.3 million.

Total instrument revenues declined 47.2% year over year to $7.7 million. Single Cell instrument revenues fell 46.1% year over year to $3.1 million, while Spatial instrument revenues dropped 47.8% to $4.6 million.  

Management noted that the decline in Spatial instruments reflected customers moderating purchases of existing products ahead of the Atera launch.

Services revenues increased 26% year over year to $10.7 million.  

10x Genomics' Regional Performance Stays Mixed

Total Americas revenues were $85 million, down 19.9% from the prior-year quarter. However, excluding non-recurring license and royalty revenues in both periods, Americas revenues increased 6% year over year, indicating better underlying performance than the reported comparison suggests.  

EMEA revenues rose 15.1% year over year to $39.9 million.

Asia-Pacific revenues declined 18.7% year over year to $26 million. Management noted that the prior-year Asia-Pacific results benefited from roughly $4 million of purchasing activity pulled forward in China ahead of potential tariff changes.  

TXG's Margin Trend

In the quarter under review, TXG’s gross profit declined 10.1% year over year to $112.5 million. However, the gross margin expanded 200 basis points (bps) to 74%, primarily driven by lower manufacturing costs, including $2.6 million of tariff refunds and lower inventory write-downs.

Selling, general and administrative expenses increased 5.7% year over year to $78.7 million. Research and development expenses declined 7.2% year over year to $56.8 million. Total operating expenses of $132.1 million increased 39.1% year over year, mainly due to a lower gain on settlement compared with the prior-year quarter. Excluding settlement gains, operating expenses were approximately flat year over year.

Total operating loss was $19.6 million against an operating income of $30.1 million in the year-ago quarter.

TXG’s Financial Position

TXG exited the second quarter of 2026 with cash, cash equivalents and marketable securities of $552 million, up from $539.8 million at the end of the first quarter of 2026. Importantly, the company ended the quarter with no debt on its balance sheet, underscoring a solid solvency position.

10x Genomics Raises Its 2026 Revenue Outlook

The company raised its 2026 revenue guidance to $610 million-$630 million from the prior range of $600 million-$625 million. Excluding non-recurring patent litigation settlement revenues in both 2026 and 2025, the updated outlook represents growth of 2% to 5% over 2025.

Management attributed the increase to first-half performance and the $1.6 million of settlement revenue recognized during the second quarter. The outlook assumes that the broader academic funding environment remains roughly consistent with recent conditions, leaving potential improvement in funding outside the company's current guidance assumptions.

Wrapping Up

10x Genomics exited the second quarter of 2026 with better-than-expected results, as both earnings and revenues beat the Zacks Consensus Estimate. Reported revenues declined year over year due to lower non-recurring license and royalty revenues. However, the underlying business remained resilient. Products and Services revenues increased, supported by growth in Single Cell and Spatial consumables and higher services revenues. Gross margin expansion was another positive, although the company swung to an operating loss from year-ago operating income.

Atera remained the key development in the quarter. Customer response was strong, with booked orders at the end of the second quarter already well above the roughly 40 instruments previously expected for 2026. TXG continues to expect shipments of around 40 units this year as manufacturing capacity ramps. The company expects Atera-related transition dynamics to weigh on third-quarter revenues as customers moderate purchases of existing Spatial products. A significant sequential revenue increase is expected in the fourth quarter as Atera shipments begin contributing more meaningfully.

TXG also strengthened its multiomics and diagnostics strategy during the quarter. The company acquired Proteintech Genomics, adding advanced protein-detection capabilities to its Single Cell and Spatial platforms. It also announced multi-year research collaborations with Cleveland Clinic and Lausanne University Hospital to advance diagnostic applications in cancer care. Meanwhile, TXG ended the quarter with $552 million in cash, cash equivalents and marketable securities, providing financial flexibility to support product development and commercialization efforts.

TXG’s Zacks Rank and Stocks to Consider

TXG currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the broader medical space are McKesson MCK, Phibro Animal Health PAHC and Cardinal Health CAH.

McKesson carries a Zacks Rank #2 (Buy) at present and has an estimated long-term growth rate of 13.7%. MCK’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 3.09%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

McKesson shares have gained 8.8% against the industry’s 12.7% decline in the year-to-date period.

Phibro Animal Health, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 21.5%. PAHC’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 16.25%.

Phibro Animal Health stock has climbed 44.2% against the industry’s 17.1% decline in the year-to-date period.

Cardinal Health, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 17%. CAH’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 10.27%.

Cardinal Health’s shares have lost 2.6% compared with the industry’s 3.1% decline in the year-to-date period.

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