Company: TXG
Filing Date: 2025-05-09
Form Type: 10-Q
Source: 0001770787-25-000032
Chunk: 174

Company: 10x Genomics, Inc.
Filing Date: 2025-05-09
Form: 10-Q
Item: Part I, Item 4
Chunk 174
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 develop as we expect, our growth may be limited and our business, financial condition and operational results may be adversely affected.

Our products generate large-scale complex data which requires advanced analytics to interpret.  

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Our products generate highly complex data that can present significant challenges in terms of understanding and interpretation, particularly for customers who may lack bioinformatics expertise or dedicated computational resources. The advanced nature of the data generated by our products requires a certain level of expertise to analyze and interpret effectively. Some of our customers may lack the necessary technical skills or resources to fully understand and utilize the data. As a result, they may experience difficulties in deriving actionable insights, which could delay additional usage of our products or diminish their perceived value. 

To address the complexity of data, we may need to provide extensive training and support to our customers. Despite these investments, there is no guarantee that customers will achieve the necessary level of proficiency or efficiency in analyzing data. Providing ongoing customer education and technical assistance may increase operational costs, and place additional demands on our customer support teams. If customers struggle to extract meaningful insights from their data, this could reduce the perceived value of our solutions and slow adoption of our solutions. If customers encounter difficulties with data analysis, it could negatively impact their satisfaction with our products, lead to delays in reordering our products or services desire or lead them to decide not to purchase additional products or services, any of which would negatively impact our financial results.

Our failure to effectively manage product transitions or accurately forecast customer demand could result in excess or obsolete inventory and resulting charges.

Because the market for our products is characterized by rapid technological advances, we frequently introduce new products or new versions of existing products designed for improved ease-of-use, improved performance or additional features and functionality. At times, we preannounce products and services, in some cases before such products and services have been fully developed or tested, and risk failing to meet expectations when and if such products and services become available. The risks associated with the introduction of new products or new versions include the difficulties of predicting customer demand and effectively managing inventory levels to ensure adequate supply of the new product or new versions and avoiding excess supply of the legacy product, including legacy versions of our instruments which are supplanted by new versions. For example, we recorded charges of $11.3 million and $7.8 million in 2024 and 2023 related to excess and obsolete inventory. In addition, in the past supply chain disruptions, logistics, shipping and other distribution disruptions and labor shortages have made it more difficult to predict customer demand and effectively