Fluidigm’s continued SCG revenue growth aligns with our aggressive forecast for the SCG marketFluidigm (NASDAQ:FLDM) recently released their Q3 2013 earnings. The company beat analysts’ expectations on both the top line and bottom line and have increased full year 2013 revenue growth guidance to 32 – 34% year-over-year ($69-70M for total 2013 revenue). Notably, this was the second consecutive quarter in which Fluidigm increased guidance for the 2013 revenue. Annual revenue growth guidance provided in Q2 was 27 – 31% ($66-68.5M), increased from 22 – 26% (($64-66M). On the trading day following Fluidigm’s Q3 earning release, their stock popped ~18%, clearly signaling Wall Street’s approval.Overall, the quantitative and qualitative information released during the call align very well with the forecast in our Single Cell Genomics (SCG) market report (stagingdecibio.wpengine.com/SCG). As a result, we reiterate our aggressive growth rate for this market, as we continue to believe that SCG is poised for growth, driven by innovations from market leaders such as Fluidigm.Key highlights from Fluidigm’s Q32 2013 earnings call include:

• Overall revenues in Q3 increased 43% year-over-year (YoY) to $18.3M
• Single cell genomics (SCG) continues to be a key revenue driver
• SCG revenue doubled YoY and now represents ~45% of revenue (consistent with Q2, but up from ~40% of revenue in Q1 2013)
• Approximately 65% of Fluidigm’s BioMark HD System sales during the quarter were motivated by single cell gene expression research.
• Recently launched C1 Single-Cell Auto Prep System is driving instrument revenue growth
• Overall instrument revenue grew 61% YoY
• 30% of C1 sales were bundled with the sale of a new BioMark HD driven by increased interest in single cell gene expression
• The number of single-cell publications that reference Fluidigm rose to approximately 100
• The first 3 peer-reviewed articles that employ the C1 Single-Cell Auto Prep System were published in Q3.
• Overall consumables revenue grew 22% YoY driven primarily by production genomics
• Chip pull-through on analytical systems was within the historical range of $40,000 to $50,000 per system per year
• In contrast, chip pull-through on preparatory systems was higher than their historical range of $10,000 to $15,000 per system per year
• Just after Q3’s end, Fluidigm reached a settlement with competitor Nanostring Technologies, who published promotional material that mischaracterized Fluidigm’s BioMark HD System. These materials referenced a study comparing BioMark HD unfavorably to Nanostring’s nCounter system for single-cell gene expression analysis. Fluidigm alleged that the data that data from this study was not scientifically valid, as it was collected using unstandardized protocols at different laboratories. Nanostring will cease referencing this study.---

• Authors: Stephane Budel, Partner at DeciBio, LLCConnect with Stephane Budel on Google+https://plus.google.com/+StephaneBudel