On Monday, Illumina Inc. (NASDAQ:ILMN) said that it is implementing cost cuts of approximately $100 million in fiscal year 2025 in response to China's recent ban on importing its sequencers.
Last week, China banned imports of genetic sequencers from Illumina just after U.S. President Donald Trump's additional 10% tariff on Chinese goods took effect.
China accounted for about 7% of Illumina's sales of $4.3 billion in 2024.
The diagnostic firm has lowered its 2025 adjusted EPS guidance to $4.50, at the low end of the range of $4.50 to $4.65, compared to the consensus of $4.45.
China claimed the two companies had disrupted normal market transactions and tried to harm the legitimate rights and interests of Chinese enterprises.
According to Illumina, "These savings would mitigate the impact of a range of potential scenarios for a reduction in revenue and related operating income from the company's Greater China business. The cost reduction program includes optimizing stock-based compensation and non-labor spending and accelerating certain productivity measures."
"Our new fiscal 2025 guidance provides for limited further earnings contribution from China and assumes a continuation of the macro trends we see today," Illumina CFO Ankur Dhingra said in a statement.
"We will continue to invest in our growth strategy, while taking actions to achieve EPS of approximately $4.50 in 2025, and then grow from there." "We remain focused on achieving high-single-digit revenue growth by 2027, while expanding our margins," Illumina CEO Jacob Thaysen said in a statement.
Price Action: ILMN stock is down 1.24% at $84.90 at the last check on Tuesday.
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