管理層發言
Hello, everyone. Thank you for joining us, and welcome to the 10x Genomics Second Quarter 2026 Earnings Conference Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to Cassie Corneau, Head of Investor Relations and Strategic Finance. Please go ahead.
Thank you, and good afternoon, everyone. Earlier today, 10x Genomics released financial results for the second quarter ended June 30th, 2026. If you have not received this news release or would like to be added to the company's distribution list, please send an email to investors@10xgenomics.com. An archived webcast of this call will be available on the Investor tab of the company's website, 10xgenomics.com, for at least 45 days following this call. Before we begin, I'd like to remind you that management will make statements during this call that are forward-looking statements within the meaning of Federal Securities laws. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated, and you should not place undue reliance on forward-looking statements. Additional information regarding these risks, uncertainties, and factors that could cause results to differ appears in the press release 10x Genomics issued today, and in the documents and reports filed by 10x Genomics from time to time with the Securities and Exchange Commission. 10x Genomics disclaims any intention or obligation to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. Joining the call today are Serge Saxonov, our CEO and Co-founder, and Adam Taich, our Chief Financial Officer. We will host a question and answer session after our prepared remarks. We ask analysts to please keep to one question so that we may accommodate everyone in the queue. With that, I will now turn the call over to Serge.
Thanks, Cassie, and good afternoon, everyone. I will start with a brief overview of our second quarter performance, then provide an update on Atera, and finally discuss several broader trends that are reshaping biological research and creating new opportunities for our business. Revenue for the second quarter was $151 million. During the quarter, we recognized $1.6 million of license and royalty revenue in connection with our settlement with Takara. Excluding non-recurring settlement revenue in both this quarter and the prior year period, Q2 revenue was $149 million and grew 3% year-over-year. The story of the quarter was the extraordinary customer response to Atera. We're highly encouraged by the engagement across the research ecosystem and the very strong early order flow. At the same time, our core products showed sustained strength. We drove robust growth in Chromium consumable reaction volumes, reflecting expanding usage across a broad range of applications. In spatial, Xenium utilization continued to perform exceptionally well, reinforcing its position as the leading platform for spatial analysis today. Our launch of Atera is still, by far, the biggest highlight of the year. On our last call, I discussed Atera's core capabilities, many of which were not thought possible within a single platform. It delivers step change advances across a range of features, including throughput, Flex, and sensitivity. Atera enables spatial whole transcriptome profiling with single-cell sensitivity at scale. The promise of spatial has always been that it represents the convergence of molecular, cell, and tissue biology. Atera is poised to deliver on that promise to provide researchers with a fundamentally more complete view of biological systems and answers to many questions that were previously out of reach. You may remember that we said initial customer reception exceeded our expectations, which were already very high heading into the launch. Since then, customer enthusiasm has only gotten stronger. This has translated into a strikingly large number of orders in a very short amount of time. The momentum we're seeing is remarkable for a platform that was completely unknown to our customers only a few months ago. We believe customers' enthusiasm should only increase as they learn more about the system and see what it is able to deliver in their hands. Similarly, we're seeing strong demand for Catalyst Research Services, a program for customers to submit their own samples to be run on Atera in our lab. We expect sample processing to begin alongside Atera's commercial availability. Catalyst Research Services is designed to support a range of customer needs, from generating initial pilot data sets, to providing flexible and ongoing access for routine research, to enabling researchers who do not yet have access to an Atera instrument. The strong demand for the service is another encouraging leading indicator for the future of the platform and the breadth of its impact. Our vision for Atera was to build the cornerstone platform that enables scientists to interrogate a full spectrum of research questions with the versatility and scale needed to resolve the complexity of biology. It is gratifying to see that vision start to come to life as customers describe how they plan to use Atera. We're seeing engagement from universities, academic medical centers, and biopharma companies pursuing research across nearly every major disease area. From oncology across dozens of tumor types to neurodegeneration, autoimmune and inflammatory disease, cardiometabolic conditions, kidney and transplant biology. The list goes on. That diversity is also evident in the specific research questions being asked. Customers are interested in applying the platform for foundational cell and tissue atlasing, mechanistic studies of how disease actually develops, monitoring response to novel immunotherapies and cell therapies, and for early biomarker and translational work. Just as importantly, customers are planning to integrate Atera into the routine fabric of their research. Researchers within academic medical centers, for instance, are planning to deploy it across the entirety of their translational oncology programs. We're hearing similar conviction from industry, where senior R&D leaders at top biopharmaceutical companies are investing in Atera with a belief that spatial biology will fundamentally change how they approach drug discovery and development. We built Atera as a long-duration, upgradable platform with capabilities that will continue to expand over time. Atera's extensive roadmap includes workflow automation, base-by-base spatial sequencing, and the addition of protein multi-omics. With that in mind, during the quarter, we took an important step to enhance our proteomics capabilities with the acquisition of Proteintech Genomics. Proteintech Genomics brings deep expertise and differentiated technologies for measuring proteins in multi-omics context. We believe integrating rich proteomic information alongside spatial transcriptomics will further expand the biological questions Atera can address and continue to strengthen the platform. The intensity of the early interest and the spectrum of customer applications are reinforcing our conviction that Atera is poised to transform how we measure and understand biology. When you look back at the history of our industry, every now and again, a new platform comes along that reshapes markets and changes how science is done. This is a very rare but profoundly exciting occurrence. We built Atera with exactly that ambition, and the early signs suggest it is on that trajectory. Turning to single cell, I want to highlight a few major trends driving the business. First, our customers are adopting our platforms for larger, more ambitious studies. Over the past several quarters, products like Flex Apex have enabled a new generation of this work, particularly in biopharma and translational research. One way we're supporting this shift is through our recently introduced whole blood workflows that stabilize samples at the point of collection, enabling longitudinal research, distributed sample acquisition, and access to archived material. Second, there is a growing interest in additional modalities in multi-omics, an area that has always been a strength of our portfolio and a focus of our investments. Last quarter was a particularly great example. We launched a new GEM-X version of our Multiome product, significantly improving researchers' ability to measure epigenetics and gene expression from the same cell. This unlocks new dimensions of biological context and has been met with positive early customer response. Furthermore, the Proteintech Genomics acquisition expands and complements our existing multi-omics capabilities. It provides us with the largest single-cell protein panels on the market and allows us to offer more complete solutions for customers to measure gene expression and proteins on the same cell. Finally, a significant trend in single cell has been an increase in large-scale perturbation experiments to map biological mechanisms and resolve causality. We're finding that Flex Apex is becoming the standard assay for these experiments because of its scalability, robustness, and sensitivity. While we see significant Flex Apex adoption across all customer segments, the uptake of Apex in biopharma has been particularly strong, driven by the application of perturbation screening to target identification. The value of these studies is also increasing because of the progress in AI, which helps derive mechanistic insights from the large amounts of data generated by these experiments. As we have discussed before, we believe AI represents a significant and structural tailwind for our business. AI has enormous potential to transform biology and human health, but realizing that potential depends on generating vastly more of the right kinds of data. The key bottleneck for AI-driven progress in biology is the same bottleneck we identified when we started the company. Biology is incredibly complex. We understand only a tiny fraction of it, and solving that complexity requires measuring biological systems at massive scale and high resolution. We built single-cell and spatial technologies for precisely that purpose, which is why they're now being deployed by so many of our customers to train AI models. In fact, AI, as an influencer of demand, is now becoming pervasive across our customer base. Today, most significant biological data generation efforts are conceived, at least in part, with the goal of training AI models. On the academic side, there are multiple well-known pioneering efforts, such as those led by CZI and the Arc Institute, dedicated to building virtual biology models. We're also seeing a wider shift where more basic scientific research entails training AI models. This shift is driven bottom up by decisions of individual scientists as well as top-down by philanthropic and government funding priorities, such as those outlined in recent proposals from the White House. A similar shift is also starting to happen in biopharma with rapid growth in AI-focused investments. Initially, much of the AI work in drug development has focused on the chemistry side of the process, on creating molecular interventions once a target is known. Going forward, we expect increasing investments to be made in modeling biology at the cell and tissue level to unlock new targets and to predict drug response in patients. We believe this is where the biggest bottlenecks are and where there are the greatest opportunities to transform drug development. This work is also precisely what our tools enable and why we anticipate a very large opportunity for our technologies over time. Most pharma companies now have strategic mandates to leverage AI to speed up drug development and increase the probability of success. At the same time, there's a rapidly growing number of biotech companies that seek to transform drug development using AI. More and more of them are focused on building sophisticated virtual models of human biology. The vast majority of the companies building such models are using 10x single-cell and spatial technologies. Customers overwhelmingly choose our products because they deliver the highest data quality, the largest scale, the widest biological context, and the most powerful multi-omics capabilities. It has become increasingly clear in the field that all of these considerations are critical for building high-quality, generalizable, and useful models. It should be noted that building better models is only a part of the AI story. For years, one of the biggest barriers to broader adoption of single-cell and spatial biology has been the bioinformatics expertise required to analyze increasingly rich data sets. Advances in agentic AI are beginning to remove that bottleneck. Researchers who previously required dedicated computational experts are starting to analyze complex data sets through natural language interactions with AI agents. We believe that will make single-cell and spatial analysis accessible to a much broader community of scientists while increasing the value of the underlying data. Together, these trends reinforce our conviction that single-cell and spatial biology are foundational to the future of basic science and drug discovery research. AI is increasing both the demand for high-quality biological data and the ability of researchers to extract insights from that data. We believe those two forces will reinforce one another over the coming years. As we have discussed previously, we envision a significant opportunity to extend our technologies into clinical diagnostics in the future. Realizing that opportunity requires generating robust clinical evidence on large patient cohorts. We're continuing to make progress on our internal efforts to generate such evidence in oncology and in autoimmunity. This quarter, we announced new partnerships with the Cleveland Clinic and with the Lausanne University Hospital to identify biomarkers of response to therapy across multiple oncology indications. Taken together, this quarter demonstrates the strength of our strategy and continued execution across our business. We advanced a game-changing new platform, sustained strong momentum in our core consumables business, and deepened our engagement with customers through high-impact partnerships. We continue to build a stronger company operationally and financially, giving us the flexibility to invest for the long term. Our technologies are at the nexus of some of the most powerful trends transforming biology and medicine. The upcoming years are going to be profoundly exciting, and we're uniquely well-positioned for the opportunity ahead. With that, I will turn the call over to Adam.
Thanks, Serge. Unless otherwise noted, all growth rates referenced reflect year-over-year comparisons. Revenue for the second quarter was $151 million. As Serge mentioned, when excluding the $1.6 million allocated to license and royalty revenue, our second quarter revenue was $149.4 million. This represents 3% growth over Q2 2025 when excluding the non-recurring settlement revenue in both periods. These results reflect continued momentum in the key drivers of our business. Total consumables revenue was up 7%, with growth in both single-cell and spatial. Single-cell consumables revenue grew 3%, supported by double-digit growth in reaction volumes given accelerating momentum for Flex Apex. Spatial consumables continued to perform well in the quarter, with revenue up 16%. We saw sequential consumables revenue growth for both Xenium and Visium, though Xenium continues to be the primary driver of spatial consumables growth. Total instrument revenue declined 47%, with Chromium instrument revenue down 46% and spatial instrument revenue down 48%, both primarily driven by a lower number of units sold. As anticipated, the decline in spatial instruments reflects customers moderating purchases of our current spatial products in anticipation of Atera. Looking at revenue by geography, excluding the impact of non-recurring license and royalty revenue in both periods, Americas revenue was up 6%. EMEA grew 15%. APAC revenue was down 19%. As a reminder, APAC benefited from approximately $4 million of temporary pull forward in purchasing activity in China in the prior year period as customers accelerated orders ahead of potential tariff changes. Turning to the rest of the P&L. Gross margin increased to 74% from 72% the prior year. The increase in gross margin was primarily driven by lower manufacturing costs, which included $2.6 million of tariff refunds, as well as lower inventory write-downs, partially offset by a decrease in non-recurring license and royalty revenue. Excluding the impact of non-recurring settlement revenue in both periods, gross margins increased to 74% from 67% the prior year. Total operating expenses were $132.1 million for the quarter as compared to $95 million in the prior year period. The second quarters of 2026 and 2025 included gains on settlements related to patent litigation of $3.4 million and $40.7 million, respectively. Excluding these gains in both periods, operating expenses were approximately flat year-over-year. We ended the quarter with $552 million in cash equivalents, and marketable securities, up $105 million year-over-year and up $12 million sequentially. Turning to our outlook for the rest of the year. We are raising our full year outlook and now expect 2026 revenue to be in the range of $610 million to $630 million. Excluding non-recurring revenue related to patent litigation settlements in both 2026 and 2025, this represents 2% to 5% growth over the full year 2025. The increase to our outlook reflects our performance in the first half, together with the benefit of the $1.6 million of settlement revenue recognized during the quarter. As Serge mentioned, order volume for Atera has been very strong. We previously communicated that we expect to sell approximately 40 Atera instruments this year, weighted mostly towards the fourth quarter. As of the end of the second quarter, booked orders already greatly exceeded that full year number. That said, our shipment outlook of approximately 40 units for the year remains unchanged as we continue ramping production. Looking at our quarterly cadence, Atera demand is driving the transition dynamics we expected as customers are moderating purchases of existing spatial products in anticipation of Atera. We expect this spatial transition dynamics to continue into the third quarter, resulting in a modest sequential step down for our total revenue from Q2. We expect a significant step up in the fourth quarter as Atera shipments ramp and begin to contribute more meaningfully to revenue. Atera alone accounts for the large majority of the Q4 sequential increase implied by the midpoint of our full year guidance, with normal seasonal Q4 strength across the rest of the portfolio closing the remainder of the difference. As we look to the second half, our priorities are unchanged, delivering for our customers, executing with discipline, and strengthening our operating profile. That foundation allows us to keep investing across the portfolio. The early enthusiasm we are seeing for Atera reinforces our conviction in that strategy. With that, I'll turn the call back to Serge.
Thanks, Adam. Before we open it up for questions, I want to thank the entire 10x team. This has been another good quarter of progress across the business. None of it is ever an accident. The value we create in the business and the progress we make towards our mission is entirely a function of the hard work and commitment to excellence you demonstrate every day. I'm incredibly proud of what we have accomplished and even more excited about what we're building for the future. Thank you to everyone at 10x for making the impossible possible. With that, we will now open it up for questions. Operator?
分析師問答
We will now begin the question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimal sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question is from the line of Kyle Mikson from Canaccord. Your line is now open. Please go ahead.
Hey, guys. Thanks for the questions. Congrats on the quarter. Multi-part question. First on instruments. On Atera, great to hear all the demand and the interest and all that, but maybe why remain conservative with that expectation for the second half there. Is that primarily just the manufacturing capacity constraints in the near term? Or maybe just dive into that, and then thinking about a run rate for quarterly placements, is whatever you do in Q4, is that a good way to think about the jumping off point into 2027, like Q1 and so forth? Secondly, just quickly, Serge, on AI, getting a lot of questions on your differentiation. You obviously have a lot of strong push there, but what really sets you apart, 10x apart, the revenue benefit from that and can you talk about any tangible revenue that you've recognized so far? Thanks.
Thanks, Kyle. Just to your first question on Atera. As we talked about in our prepared remarks, the demand has been extraordinary and that's not the constraint here. The constraint is actually shifting the manufacturing capacity to ship the units in the second half of the year. We continue to expect to be able to ship 40, which is what we said in the last call, and that continues to be the case going forward.
Your next question is from the line of Luke Sergott from Barclays. Your line is now open. Please go ahead.
Great. Thanks for the question, guys. Just on the Q3 updated guide, you previously thought that Q3 would be roughly flat. Now you're talking about a little step down here. Just wanted to know what got pushed out or what changed there. Secondly, as you think about the Atera launch and also in conjunction with the Flex Apex, you got a lot of things going on. Talk about the drivers here outside of Atera instrumentation launch for Q4. You talked about half of that coming from the Atera launch, but is that going to come from the Flex Apex on single-cell Chromium?
Let me take the first pieces of that, Luke. I wouldn't say that things have changed. In fact, I would just remind you that the Q3 that we're talking about here is consistent with what we said in our Q1 call. We've always known that Q3, from a transition dynamic perspective in spatial, would be the peak transition dynamics. That's exactly what we're seeing. In part, it's a function of the enthusiasm that we've seen around Atera. We'd originally said back when we gave the original guide in Q1 that there'd be a step down, and then Q2 and Q3 would look similar from a dollars perspective. Now what we're saying is Q3 will look the same as what we'd articulated back on the Q1 call. We're still anticipating a modest couple million-dollar step down from Q2 to Q3. That really is just a function of what's happening both on spatial instruments, but also a bit of spatial consumables as people are ramping up and getting prepared to receive their Ateras. One thing I would clarify in your question as it relates to Q4: if you think about the 40 units that we've committed to get out the door into the hands of customers and where list pricing is, Atera instruments alone get you most of the way, almost entirely of the way from Q3 to Q4, and it doesn't factor in Atera consumables. If you add a bit of normal seasonal activity, what we would normally have anticipated, that coupled with most of the increase coming from the Atera launch with a little bit of that step up from Q3 to Q4, I think you'll find it's a fairly reasonable step up from Q3 to Q4.
Your next question is from the line of Tycho Peterson from Jefferies. Your line is now open. Please go ahead.
Hey, thanks. Serge, what are you willing to say on manufacturing capacity for next year for Atera? That's a pretty common question. Obviously 40 systems this year, but how quickly can you scale up manufacturing? Maybe just the next two to three years. How are you thinking about kind of initial pull-through from some of the early adopters? How quickly can they get up to full utilization? I've got a follow-up. Thanks.
Thanks, Tycho. The team is working really hard to get to the official launch of the platform to start shipping. As we said, we plan for 40 units in the second half of the year. As we move into next year, we certainly expect to keep building out our capacity. We're building Atera on the backs of a lot of investments we made over the years into operational infrastructure and supply chain expertise. All of that will be brought to bear as we scale up and move into next year and beyond. We feel good about being able to scale up capacity over time to meet demand. As far as pull-through is concerned, we feel good about the interest in the platform. It's too early to talk about precise estimates before we even get instruments out there and people start running them. That said, we are focused on engaging customers that are eager to use the platform and ramp up sooner rather than later. We feel optimistic about utilization. For calibration, mass utilization of Atera is somewhere between, depending on the assays, between about $1.5 million and $2 million to $3 million or so, depending on the assays, which is about 2X that of Xenium. There's plenty of room for people to make use of these instruments. It's a little too early to give precise numbers, but we feel quite optimistic about the trajectory at this stage.
Okay, follow up on single-cell. Just thinking, next year the Street's got 4% growth in Chromium consumables. Pricing stabilized. These are big Perturb-seq studies getting underway. Why couldn't it be double digits? Can you just talk a little bit about how you're thinking about the next couple of years for Chromium?
It's a little early to talk about the next couple of years. We're in the middle of a material transition year because of the Flex Apex dynamic. Apex has had good momentum since launch toward the end of last year and has shown nice growth this year. Based on the funnel, we expect Apex to be an even higher percentage of reactions as we go into the second half. Our expectation is that by the end of the year, the large majority of people who would convert to Flex from our existing other products will have converted, which should put us in a good spot for subsequent quarters and years going forward.
Your next question comes from the line of Dan Arias from Stifel. Your line is now open. Please go ahead.
Yeah, hi, guys. Thanks for the questions here. Serge, maybe a bit of a technical question on Atera. When you guys do your assessments of the platform sensitivity, what portion of the time are you finding that sensitivity is higher than Xenium? I'm not trying to geek out here, but I am curious about just the degree to which potential customers are able to appreciate an advantage on performance just in order to get them over the hump on a purchase decision. It seems like it varies depending on where in the transcriptome you look. I guess I'm just curious about what the overall view would be when you compare the two platforms, and then how that translates to sales messaging.
There's a lot of nuance to these comparisons, but the high-level picture is unambiguous: Atera sensitivity is substantially higher than Xenium's. It's important to compare apples to apples for various assays. For very targeted panels, if you care about specific genes, you can boost sensitivity on genes with either platform. For wider use assays, for example, whole transcriptome on Atera, you're able to get to single-cell sensitivity, which with large Flex kinds of panels on Xenium, you can't really do. Atera also allows augmenting with additional custom content if you need to boost any genes further. Overall, we feel strong about this platform. We released early datasets to give people a flavor of what the platform can accomplish. There is still work going on in R&D to keep improving the specs of the platform. Based on the datasets we've released so far, feedback from the community has been overwhelmingly positive, and that bodes well for the trajectory of the platform.
Your next question comes from the line of Subbu Nambi from Guggenheim Securities. Your line is now open. Please go ahead.
Hi, guys. This is Thomas on for Subbu. Thanks for taking our question. Given there's normally hiccups with the first iteration of any product launch, what feedback are you hearing from customers who might still be on the sidelines? How are you thinking about the roadmap for the rest of this year after the first placements to make this transition smooth for those customers? Thanks.
A lot of demand for the platform. We've seen really strong interest and eagerness from customers. Many customers are lobbying to get units earlier rather than later. From a demand perspective, it's not an issue. In terms of product performance once it's in the field, that's something we take very seriously. We have a lot of experience with product development and delivering platforms that work well in the field. Atera has been in development for a long time and has undergone extensive testing and validation before shipping. The team has made tremendous progress. We feel good about where things are headed and expect it to be similar to our previous successful launches. On the roadmap, we discussed many elements including investments in software, more content and panels, additional capability around automation, proteomics, multi-omics, and base-by-base sequencing. There's a lot to be said for the platform right out of the gate, and more capabilities will come in the coming quarters and years.
Your next question comes from the line of Michael Ryskin from Bank of America. Your line is now open. Please go ahead.
Hey, thanks, guys. I want to go back to Chromium and the single-cell platform. Chromium consumables are kind of flat sequentially throughout the year. Instruments were a little bit on the lighter side. I understand a lot of focus on spatial and maybe Xenium. Just want to dig into more into what you're seeing there. You've got things like the Billion Cell Atlas ongoing. You've got things like Quartzy ongoing. You've been talking about AI-driven drug discovery, which I think should tap into single-cell a lot. Just sort of why are you seeing a little bit stronger numbers in Chromium? Is it all really tied to Flex or is there anything else going on? Maybe if you could just quantify what you're seeing, give us any tangible metric that we could latch onto for AI-driven demand, just so we can figure out how big it is for you right now in Q2. Thanks.
On single cell, the first-order dynamic is the transition driven by Flex Apex and the rise of Apex. It's had nice pickup and momentum. We expect that to continue. A lot of that growth is driven by AI applications and larger-scale experiments that involve larger cohorts and distributed sample collection, which Flex supports well. That also influences instrument placements because Flex enables centralized processing and may lead to centralization to resource providers and core labs, reducing the need to place instruments at every lab. We have a lot of Chromium instruments already in the field, so accessibility is generally not an issue. The dynamics around single cell are similar to what we've described over the last couple of quarters, and we expect that to continue. I expect the majority of people who intend to transition to Apex will largely have done so by year-end, which should position us well to drive robust reaction growth and translate into more top-line impact. Regarding AI, there are many layers. AI is now a major structural tailwind for us because these big AI models need precisely what we've built. AI is becoming pervasive across our customer segments. In some cases, AI is a driver of demand; in others, it's an influencer or accelerator. The landscape is changing fast. For drug development, much early AI work has focused on chemistry; the bigger opportunity is on biology—target identification and patient selection—where our tools are particularly compelling. There are parts of our revenue where AI demand is unambiguous, such as tech bio companies and large academic projects. For big pharma and academia, it's often a mix. It's early, but the opportunity is massive and our technologies are well-positioned. As these categories grow, we'll provide more granular color on how to think about numbers around them.
I'll add briefly to the point about centralization for Chromium instruments. We're focused on driving every part of our business. Distinguishing between demand for instruments versus demand for platform usage and consumable volume is important. Chromium instrument revenue is a small portion of sales—about 2% of sales—which is important context as we're thinking about the total business.
Your next question comes from the line of Matt Larew from William Blair. Your line is now open. Please go ahead.
Hi, good afternoon. You referenced a number of the larger projects you're working on with respect to AI and also on the translational side. In some cases, customers adopting or increasing use of multiple platforms. I'm curious, as you're having these discussions about larger projects, multi-year projects, how important the suite of products that you have and software and analysis tools where there's perhaps some integration or at least familiarity how that kind of ecosystem might be having an effect as customers think about even longer-term projects versus the merits of the platforms on their own.
Platforms by themselves, whether single-cell or spatial, have strong merits. Flex Apex provides high sensitivity, scalability, and robustness, which is important for AI because to build useful, generalizable models you need to measure many different contexts. Flex is great for that. Multi-omics capability is an emerging trend and is another area where we have unmatched strength. There is attractiveness to training models from spatial and single-cell perspectives. We've also invested in software to enable people to run larger scale experiments and manage large datasets. Together, these pieces provide compelling solutions for customers that are stronger than alternatives on the market.
Your next question is from the line of Casey Woodring from J.P. Morgan. Your line is now open. Please go ahead.
Hi, this is Jayden on for Casey. Thank you so much for taking my question. I had one just on the broader market trends. Can you unpack what you're seeing across your academic end market? We've been hearing that some academic customers are beginning to receive grant approvals, but that funding has not yet fully flowed through to purchasing activity. Is that consistent with what you're seeing? How much of that are you thinking about the timing for potential improvement in that end market for the rest of the year, and would that be upside to the guide? Thanks.
It's been a tenuous environment for a while. Sentiment has been getting somewhat better, but the dollars are still not fully flowing through into purchasing decisions. Even if funding appears at a high level, it doesn't always impact purchasing because of allocations, multi-year funding, increased oversight of review processes, staffing shortages for grant reviews, and order processing delays. The environment is roughly similar to last quarter.
To add on the guide, we're not anticipating things getting materially better in the near term. The guide assumes macro conditions stay similar to what we've been seeing. If there is improvement, that could be upside, but we built the guide with the current environment in mind.
Your next question is from the line of David Westenberg from Piper Sandler. Your line is now open. Please go ahead.
Hi, this is Skye on for Dave. Thanks for taking the question. Could you talk a little bit more about the commercial landscape of Atera and what it might look like going forward? Is it being sold by the existing sales force, or is there a specialized team, and do you anticipate needing to expand the sales count there? Also, are there any incentives in place to kind of steer Xenium or Visium customer prospects towards Atera? Sorry. Thanks.
Two years ago we restructured our sales force and created a team focused on CapEx sales. That has put us in a good position for Atera, with a team specifically focused on Atera instruments to introduce them to the market. We are also leveraging the rest of our team to reach customers broadly and have teams work in concert. Regarding incentives, no special incentives to drive customers to Atera. Our focus is always to satisfy the customers' application needs and provide the right solution. The excitement around Atera is driven by customer demand.
Your next question is from the line of Puneet Souda from Leerink. Your line is now open. Please go ahead.
Yeah. Hi, Serge and team. Thanks for taking my questions here. If I could ask on, again, Atera, obviously, a really powerful instrument, but just wanted to get a sense of how are you incentivizing the broader labs beyond the top labs and institutes that are already interested in Atera and likely in the first 40 that are likely going to get it? Are you incentivizing them with any discounts? Are there any discounts for the broader labs on Xenium? Just wanted to get that or any change in pricing that you're expecting here in the near term. The funding of the capital equipment remains challenging in the current environment. On the AI side, it does appear that the biology foundation models or the virtual cell models would require funding in the scale of $100 million or something closer in order to build the data for those models. Can you maybe just elaborate on what are the line of sight to the major large grants or funding sources right now that you see and the timing for those to land into 10x revenue? Thank you.
First, on Atera: it's early days, but demand has been strong beyond the early adopters, including biopharma. We haven't had to incentivize customers to place orders; demand has been driven by customer interest. We will run programs in different territories where salespeople work with customers to give them appropriate deals, but nothing extraordinary in the last quarter. On AI and funding: there's a reprioritization of funding flows at high levels. Anything that involves large-scale science is increasingly being prioritized with AI as a driver. If the goal is to understand biology using AI, single-cell and spatial are essential because they provide the necessary scale. As governments and philanthropic organizations set priorities, we anticipate more deployment of single-cell and spatial, which should translate into more revenue for us over time.
Your next question is from the line of Dan Brennan from TD Cowen. Your line is now open. Please go ahead.
Awesome. Hey, guys. Thank you. Maybe just starting, just on Atera, good to hear the order is already exceeding the 40. Is there any way just to help think about the placement opportunity? I know you get asked this, but I'm just trying to frame it, what it is the next few years and how purely additive to the business is it versus what might take away. Obviously, Xenium going to stop shipping, but I'm just wondering on your other products as well.
We expect Atera to amplify and accelerate the growth in the spatial market. Xenium has been growing spatial robustly and continues to show strong growth. As we look forward to Atera, we expect it to more than make up for any reduction in sales of Xenium and Visium over time.
I'll add that even after the Atera launch, both Visium and Xenium consumables grew sequentially from the prior quarter. There's good momentum in spatial with the existing products.
Your next question comes from the line of Justin Bowers at Deutsche Bank. Your line is now open. Please go ahead.
Hi, good afternoon. Just want to continue in the spirit of the last couple of questions. Can you talk about how you're segmenting the market for Atera versus Xenium and some of the lessons learned from the Xenium launch and, really, how does this new product cycle expand the TAM for spatial?
We're seeing demand from across the board: universities, academic medical centers, and biopharma companies, with broad application interest. We started with a focus on oncology but are seeing strong interest in neuroscience, autoimmune, cardiometabolic, kidney, and many other areas. Experiments include foundational tissue atlasing, mechanistic studies, response to drugs like immunotherapy and cell therapies, and biomarker translational work. Early signs point to material market expansion. Xenium is the best spatial platform today and continues to be used; Atera will take up more of the spatial market over time and drive material expansion of the market.
Your next question is from the line of Kallum Titchmarsh from Morgan Stanley. Your line is now open. Please go ahead.
Hi, this is Jason on for Kallum. Thank you for taking my question. Appreciate the prior guidance on expectations for Atera instrument placements in the back half. I was wondering if you could provide some guidance on how we should think about Atera consumables revenue for 2026. Would similar consumables pull-through per instrument as Xenium be a good jumping-off point? Thank you.
It's hard to quantify at this time because we don't have units in the field yet. We know maximum pull-through could be about 2x that of Xenium. Our intent is to get the first 40 instruments into the hands of customers who will run them. Some service providers will provide access for those that don't have CapEx or weren't among the first 40. We are taking orders on consumables, but we won't quantify that right now. The Q3 to Q4 step-up in our guidance is mostly covered by Atera instruments alone. We anticipate YoY growth in consumables in Q3 but a sequential step-down into Q3 because some customers are planning ahead for Atera and won't place orders they would normally place. The step-up from Q3 to Q4 is largely driven by Atera instruments, some consumables, and normal year-end dynamics, which is consistent with the midpoint of our guidance.
There are no further questions at this time. We have reached the end of the Q&A session. This concludes today's call. Thank you for attending. You may now disconnect.