ILLUMINA INC

As of March 30, 2025, we had $1,113 million in cash and cash equivalents, of which $432 million was held by our foreign subsidiaries. Cash and cash equivalents decreased by $14 million from December 29, 2024 due to factors described in the “Cash Flow Summary” below. Our primary source of liquidity, other than our holdings of cash, cash equivalents, and investments, has been cash flows from operations and, from time to time, issuances of debt. Our ability to generate cash from operations, supplemented with the issuance of debt and/or liquidation of our short-term investments, provides us with the financial flexibility we need to meet operating, investing, and financing needs. As of March 30, 2025, we had $124 million in short-term investments, comprised of marketable equity securities.

In September 2024, we issued $500 million aggregate principal amount of 2026 Term Notes, which mature on September 9, 2026, and accrue interest at a rate of 4.650% per annum, payable semi-annually in March and September of each year. In December 2022, we issued $500 million aggregate principal amount of 2025 Term Notes and $500 million aggregate principal amount of 2027 Term Notes. The 2025 Notes, which mature on December 12, 2025, and the 2027 Notes, which mature on December 13, 2027, accrue interest at a rate of 5.800% and 5.750% per annum, respectively, payable semi-annually in June and December of each year. In March 2021, we issued $500 million aggregate principal amount of 2031 Term Notes, which mature on March 23, 2031, and accrue interest at a rate of 2.550% per annum, payable semi-annually in March and September of each year. We may redeem for cash all or any portion of the Term Notes, at our option, at any time prior to maturity.

In January 2023, we entered into the Revolving Credit Agreement, which provides us with a $750 million senior unsecured five year revolving credit facility, including a $40 million sublimit for swingline borrowings and a $50 million sublimit for letters of credit. The credit facility matures, and all amounts outstanding become due and payable in full, on January 4, 2028, subject to two one-year extensions at our option and consent of the extending lenders and certain other conditions. As of March 30, 2025, there were no outstanding borrowings.

As of March 30, 2025, the fair value of our contingent consideration liability related to GRAIL was $61 million, of which $59 million was included in other long-term liabilities. The contingent value rights entitle the holders to receive future cash payments on a quarterly basis (Covered Revenue Payments) representing a pro rata portion of certain GRAIL-related revenues (Covered Revenues) each year through August 2033. This reflects a 2.5% payment right to the first $1 billion of revenue each year for 12 years. Revenue above $1 billion each year is subject to a 9% contingent payment right during this same period. In Q1 2025, we paid $360,000 in aggregate Covered Revenue Payments related to Covered Revenues for the period Q4 2024 of $38 million.

In August 2024, our Board of Directors authorized a new share repurchase program, which cancels and supersedes all prior and available repurchase authorizations, to repurchase up to $1.5 billion of our outstanding common stock. The repurchases may be completed through open market purchases, pursuant to Rule 10b5-1 or Rule 10b-18, or through an accelerated share repurchase program. Authorizations to repurchase up to $1.2 billion of our outstanding common stock remained available as of March 30, 2025. We intend to repurchase incremental shares over the course of 2025.

We had $3 million (plus recallable distributions of approximately $10 million), $42 million, and $47 million, respectively, remaining in our capital commitments to three venture capital investment funds as of March 30, 2025 that are callable through April 2026, July 2029, and December 2034, respectively.

We anticipate that our current cash, cash equivalents, and short-term investments, together with cash provided by operating activities and available borrowing capacity under the Revolving Credit Facility, are sufficient to fund our near-term capital and operating needs for at least the next 12 months. Operating needs include the planned costs to operate our business, including amounts required to fund working capital and capital expenditures. Our primary short-term needs for capital, which are subject to change, may include:

•support of commercialization efforts related to our current and future products;

•acquisitions of equipment and other fixed assets for use in our current and future manufacturing and research and development facilities;

•the continued advancement of research and development efforts;

•potential strategic acquisitions and investments;

•repayment of debt obligations;

•repurchases of our outstanding common stock; and

•the evolving needs of our facilities, including costs of leasing and building out facilities.

We expect that our revenue and results of operations, as well as the status of each of our new product development programs, will significantly impact our cash management decisions. Our future capital requirements and the adequacy of our available funds will depend on many factors, including:

•our ability to successfully commercialize and further develop our technologies and create innovative products in our markets;

•scientific progress in our research and development programs and the magnitude of those programs;

•competing technological and market developments; and

•the need to enter into collaborations with other companies or acquire other companies or technologies to enhance or complement our product and service offerings.

Cash Flow Summary

Operating Activities

Net cash provided by operating activities of $240 million in Q1 2025 consisted of net income of $131 million, plus net adjustments of $113 million, less net changes in operating assets and liabilities of $4 million. The primary adjustments to net income included share-based compensation expense of $73 million, depreciation and amortization expense of $69 million, and deferred income taxes of $16 million, offset by net gains on strategic investments of $32 million and change in fair value of contingent consideration liabilities of $11 million. Cash flow impact from changes in net operating assets and liabilities were primarily driven by decreases in accrued liabilities, accounts receivable, and accounts payable, partially offset by an increase in other long-term liabilities.

Investing Activities

Net cash used in investing activities was $63 million in Q1 2025. We primarily invested $32 million in capital expenditures, primarily associated with investments in facilities, and purchased strategic investments of $24 million.

Financing Activities

Net cash used in financing activities was $195 million in Q1 2025. We used $200 million to repurchase our common stock and $22 million to pay taxes related to net share settlement of equity awards. We received proceeds from the sale of shares under our employee stock purchase plan of $27 million.