10x Genomics (TXG) Drops 8.36% in 3-Day Slide as Q3 Earnings Miss, Reorganization Weigh

10x Genomics (TXG) fell 0.91% on Wednesday, marking a third consecutive day of declines and a 8.36% drop over three trading sessions. The stock hit an intraday low of $14.02, its lowest since July 2025, amid ongoing investor concerns over operational disruptions and financial performance. The recent sell-off reflects broader uncertainty following the company’s Q3 2024 earnings report and strategic reorganization.

The decline was driven by a "disruptive" commercial reorganization that disrupted customer relationships and sales continuity. Preliminary Q3 revenue of $151.7 million fell short of estimates, with a 46% year-over-year drop in Chromium instrument sales to $19.1 million. The reassignment of 40% of accounts in the Americas during the quarter exacerbated challenges, as the Chromium segment relies heavily on long-term client engagement. Meanwhile, spatial biology instruments generated $11.4 million in revenue but could not offset the broader slowdown.

Financial metrics underscored the company’s struggles, including a -36.9% EBIT margin and a -38% profit margin. Consumables revenue, a key revenue stream, declined 10% to $126.2 million as customers delayed purchases during the reorganization. Analysts highlighted the risk of prolonged customer hesitation, with William Blair’s Matt Larew noting that commercial leadership changes often create "challenging and disruptive" environments for growth-stage companies.

While the company maintains a strong gross margin of 64.7% and a current ratio of 5.2, analysts remain cautious. Kyle Mikson of Canaccord Genuity reduced his 2024 revenue forecast to $616.2 million from $640.4 million, reflecting skepticism about near-term recovery. Both analysts emphasized the need for operational stability and disciplined cost management, particularly in R&D, to rebuild investor confidence. The stock’s valuation, with a price-to-sales ratio of 3.97, has also raised concerns about its alignment with revenue growth expectations.

The recent volatility highlights the challenges of balancing innovation with execution in the biotech sector. While 10x Genomics’ spatial biology offerings show growth potential, the earnings miss and reorganization have intensified scrutiny over its ability to maintain market leadership. Analysts remain divided, with some anticipating a modest rebound in 2025 contingent on operational stabilization and strategic clarity. For now, the stock’s trajectory remains closely tied to the company’s ability to address these structural challenges and restore investor trust.