What Illumina, Inc. told the SEC could break it.

Illumina's inclusion on China's Unreliable Entity List in early 2025 cut Greater China revenue by $65M (region revenue $243M); tariffs/trade restrictions also raised costs (a ~1pt gross-margin drag), with risk of curtailing or exiting China operations.

“Total revenue in 2025 was impacted, across all products and services, by a decrease in revenue in our Greater China region of $65 million , primarily due to our inclusion on the List of Unreliable Entities in the beginning of the year. ... Changes in tariffs, trade restrictions, and customs or export/import regulations have impacted, and we expect will continue to impact, our business by increasing costs and administrative burdens, disrupting cross-border flows, and affecting customer demand.”

Illumina's complex sequencing products require customized, precision-manufactured sub-assemblies, components and materials available from a limited number of sources — and in some cases only a single source — so delivery delays or quality failures could halt manufacturing.

“The complex nature of our products requires customized, precision-manufactured sub-assemblies, components, and materials that currently are available from a limited number of sources, and, in the case of some sub-assemblies, components, and materials, from only a single source. If deliveries from these vendors are delayed or interrupted for any reason, or if we are otherwise unable to secure a sufficient supply, we may not be able to obtain these sub-assemblies, components, or materials on a timely basis or in sufficient quantities or at satisfactory qualities.”

Illumina manufactures in a limited number of locations — San Diego/SF Bay Area (CA, earthquake/wildfire-prone), Madison (WI), Cambridge (UK) and Singapore — so a catastrophic event or component shortage at one site could disrupt production.

“We currently manufacture in a limited number of locations. Our manufacturing facilities are located in San Diego and the San Francisco Bay Area in California; Madison, Wisconsin; Cambridge, United Kingdom; and Singapore. These areas are subject to natural disasters such as earthquakes, wildfires, or floods.”

2025 headwinds — tariffs, inflation, FX, China competition, Russia sanctions and reductions in U.S. NIH research funding — weighed on Illumina and its customers' instrument-purchasing behavior amid capital/cash constraints.

“Throughout 2025, we experienced several headwinds including macroeconomic factors such as tariffs, inflation, exchange rate fluctuations and concerns about an economic downturn, competitive challenges in our China region, the sanctions imposed on Russia as a result of the armed conflict between Russia and Ukraine, and reductions in the U.S. government's funding of the NIH, all of which have impacted both Illumina directly and our customers' behavior.”