Fluidigm’s Q2 2013 revenue growth aligns with our aggressive forecast for the SCG marketOn August 1, 2013, Fluidigm (NASDAQ:FLDM) released Q2 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 27% – 31% year-over-year (from previously stated guidance of 22% to 26%). Wall Street clearly approved of the company’s performance, as the stock spiked ~10% on the trading day following the earnings release.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 Q2 2013 earnings call include:

• Overall revenues in Q2 increased 35% year-over-year (YoY) to $17.5M
• Single cell genomics (SCG) continues to be a key revenue driver SCG revenue doubled YoY and now represents ~45% of revenue (up from ~40% of revenue in Q1 2013)
• Recently launched C1 Single-Cell Auto Prep System is driving instrument revenue growth
• Overall instrument revenue grew 47% YoY
• 30% of C1 sales were bundled with the sale of a new BioMark HD driven by increased interest in single cell gene expression
• Overall consumables revenue grew 21% 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
• Operating margin increased ~300 basis points to ~72% driven by sales of the higher margin C1 Single-Cell Auto Prep System
• The announcement of a co-marketing partnership with Olink to expand the capability of the BioMark HD to include protein analysis
• The recent launch of microRNA (miRNA) expression profiling to its C1 Single-Cell Auto Prep System

By David Cavanaugh, Partner at DeciBio LLC