Hello, everyone, and welcome to the Third Quarter 2015 Illumina, Incorporations' Earnings Conference Call. At this time, all participants are in listen-only mode. We will facilitate a question-and-answer session towards the end of this call. As a reminder, this call is being recorded for quality, and replay purposes. I would now like to turn the call over to Rebecca Chambers, Vice President, Investor Relations and Treasury, Rebecca Chambers - Vice President-Investor Relations & Treasury: Thank you, Lauren, and good afternoon, everyone. Welcome to our earnings call for the third quarter of fiscal year 2015. During the call today, we will review the financial results released after the close of the market, and offer commentary on our commercial activity, after which we'll host a question-and-answer session. If you have not had a chance to review the earnings release, it can be found in the Investor Relations section of our website at illumina.com. Participating for Illumina today will be Jay Flatley, Chief Executive Officer; Francis deSouza, President; and Marc Stapley, Senior Vice President, and Chief Financial Officer. Jay will provide an update on the state of our markets, Francis will comment on product performance, and Marc will review our third quarter financial results as well as provide updated guidance for 2015. This call is being recorded, and the audio portion will be archived in the Investors section of our website. It is our intent that all forward-looking statements regarding our expected financial results and commercial activity made during today's call will be protected under the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties. Actual events or results may differ materially from those projected or discussed. All forward-looking statements are based upon current information available, and Illumina assumes no obligation to update these statements. To better…

Our first question comes from the line of Tycho Peterson from JPMorgan.

Hey, thanks. I've got to try to squeeze to and because I think they're important. But as we think about what happened in the benchtop market this quarter, can you maybe just give us some comfort that this is truly a resourcing issue, not a market demand issue, in light of what we've heard around reimbursement and other another factors? And then as a follow up, Marc, I'm wondering if you're willing to give us any parameters around OpEx for 2016. Obviously, with Helix and other factors, we needed to be thinking about some of the headwind. Thanks. Jay T. Flatley - Chief Executive Officer & Director: Tycho, I think the benchtop result was due to a combination of factors. Clearly, more feet on the street would help. We think there are opportunities that we can get over the finish line just due to time and sales focus during the quarter. As you can imagine, with products selling really well at the high end of the product line, it's always a challenge to get the sales force to focus on lower-end machines that have smaller contribution to their quotas. Having said that, there are also some geographic impacts. As we mentioned, Japan has been doing very poorly, and that's a very rich market for MiSeq and probably accounted for a material portion of the shortfall that we had in MiSeq. And that's clearly a demand funding problem, hopefully temporary, in Japan. So I would say it's a combination of attention to that part of the market overall and overall time spent selling those products as well as some localized market demand issues. Marc A. Stapley - Chief Financial Officer & Senior Vice President: And Tycho, on our operating expenses for 2016, we're in our normal budget cycle; nothing unusual about that right now, and we're going through that at the moment. I think probably the best thing to focus on is the prepared remarks that I gave around our Q4 rate. That clearly gives you a sense of the exit rate is for the year. And the items that I specifically called out are clearly going to – most of them are going to have an impact in 2016, in particular, we quoted out Helix, which is about a $0.10 impact on 2016.

Okay. Thank you.

Our next question comes from the line of Doug Schenkel from Cowen & Company. Doug Schenkel - Cowen & Co. LLC: Good afternoon, guys, and thank you for taking the question. So a number of competitors have launched product enhancements or new instruments in sequencing and adjacent areas over the past year. These developments, combined with a couple weaker-than-expected quarters and uncertainty about the growth outlook heading into 2016, have heightened focus on what we should expect the return to be on your investment in R&D. Recognizing that you're still targeting an open-ended growth opportunity, your development track record in the space has been unrivalled over the past decade. And also noting that you don't want to outline your game plan too specifically for competitive reasons and also because you don't want to stall the market, I'm just wondering what you can tell us, knowing what you know about your new product development efforts. And I guess more specifically, or maybe to cut through all of this, Jay, would you just comment on how you would describe your enthusiasm and excitement about the portfolio as you think about the growth outlook and competitive dynamics over, say, the next 12 to 24 months? And how does that compare to where we were, say, a year or two year ago? Thank you. Jay T. Flatley - Chief Executive Officer & Director: Let me start by saying, as I think I commented in my opening remarks, Doug, that we have a very rich portfolio of product opportunities. In fact, our challenge is in figuring out what to do next. It's figuring out what to pick from among a wide variety of incredible opportunities in new markets we can approach. We're probably putting less of a percentage of our total R&D investment in to…

Our next question comes from the line of Derik De Bruin from Bank of America.

Hi, good afternoon. Jay T. Flatley - Chief Executive Officer & Director: Hi, Derik.

Hey. Couple of quick ones. So the HiSeq X pull-through was certainly higher than I anticipated. It's like, do you see that furthering – do you see it accelerating in 2016? And I guess how do you sort of look, like, the non-human opportunity in HiSeq X reagents? Jay T. Flatley - Chief Executive Officer & Director: Yeah. The trend line looks really good, and that's the reason that we felt comfortable bumping the range up for HiSeq X. We're clearly going to watch that here over the next few quarters and see what our prediction looks like for 2016. Clearly, for those customers that have access to large numbers of non-human samples, opening up the organisms that you can run on HiSeq X is going to have a huge impact, and there's a couple of very specific customers who are going to run very large studies because we did – we made that change. So I think that will help the overall averages. We continue to work with those customers at the low end of the curve who are using their instruments at low utilization rates. And I think the biggest impact we can have is getting that collection of customers up from nominal utilizations up to the midrange of utilization. If we can be successful doing that, it will continue to push the overall number up in 2016.

If I can just do a quick follow-up on that, so what is the rig hold-up in terms of getting these people – getting these customers accelerating? Is that they don't have the infrastructure in place, they don't have access samples, they bought ahead with they were ready for? Jay T. Flatley - Chief Executive Officer & Director: It's a collection of different issues. In some cases, they don't have samples. There's a couple cases of what we call vanity purchases, just wanted to be in the club purchases. There are clearly a couple of examples of customers who didn't quite realize what it takes to run a large-scale sequencing center and that's where what we're doing with the software infrastructure, we're putting it around the HiSeq systems or HiSeq X systems is being to help those customers a lot, because they now have the ability control samples and re-queue samples and create a pipeline of data analysis. So those are the easy ones to move forward. The more challenging ones are the ones that have indirect sample access or less sample access or the ones who just don't have a program behind the system. And there's not a lot of those, but there's a couple.

Great. I'll get back in the queue. Thank you.

Our next question comes from the line of Dan Arias from Citibank.

Yeah. Hi, afternoon. Just wanted to ask maybe a high-level question on instruments. Francis, you mentioned that the NextSeq accounted for, I think, 50% of clinical placements. Just curious how the other 50% is shaping up for the MiSeq and the HiSeq in the hospital setting. We just sort of wanted to get a holistic understanding of the placement trend there. Francis A. deSouza - President & Director: Sure. What I talked about is, I certainly talked about NextSeq and NIPT, and said that NIPT-specific NextSeq sales grew 60% year-on-year. And other than that, we're seeing a pretty broad sort of distribution of instruments that are bought into the clinical market.

Okay. So is that to say that if you sort of took the three buckets they would all be the same size in terms of commercial hospital placements, trends per quarter? Francis A. deSouza - President & Director: Not the same size, but you're seeing s distribution across all the buckets. We're certainly seeing new-to-NGS customers primarily going into the MiSeq instrument family. And so to the extent that a low of these are new to sequencing – next-gen sequencing as a whole, they tend to go into the MiSeq instruments. And if they are doing follow-on sales then they tend to migrate up into our higher-end portfolio. Jay T. Flatley - Chief Executive Officer & Director: Very often in the translational category, we see more of the higher-end instruments, so HiSeqs, will be used when you're trying to do discovery or trying to figure out what methods to run. You're trying to screen through lots of samples to develop the final application and then very often they gets deployed on MiSeq when you get through the translational stages.

Got it. Okay. Thanks very much.

Our next question comes from the line of Jon Groberg from UBS.

Hi, good afternoon. So Jay, on the last – when you did your pre-announcement, you kind of went out your way to talk about you're maintaining your 15% to 20% growth in 2016. And just kind of listening to some of the moving parts, it sounds like I think the rates are going to be flat to up slightly in 2016. Services may be down a little bit as you migrate to products on the NIPT side. So can you maybe just – maybe just talk about what it is that gives you the confidence that you can grow 15% to 20% in 2016? Jay T. Flatley - Chief Executive Officer & Director: Yeah, sure. First thing I'd say is that every year we see – unless something catastrophic happens from a competitive perspective, we see a significant growth just on the consumables from the instruments that we'd placed the year before. So that's a great base line to build on. Average risk is going to be a big factor for us in 2016, so I think that we will begin to see in the first half of the year, maybe the second or third, approval from major payers for average risk, and that will begin to move that market ahead very, very quickly. We suspect – we've been saying this for a couple of quarters now, but we do expect Japan to come back in 2016. The infrastructure's in place and the money is going to start flowing back into Japan during 2016. So that will be huge for us because Japan has been our single most troubled geography by a wide margin over the past 18 months. So any recovery in Japan is going to have a huge positive impact for us. And as we noted in the script, arrays were a pretty big drag overall in 2015 from the growth rate perspective, and having that come back to being flat to positive is going to be big help to us as well. Marc A. Stapley - Chief Financial Officer & Senior Vice President: To some extent, I'd say also had an increase in our population sequencing services revenues slightly as the (33:07). Yeah.

And just a quick follow, Jay. Would you – a question I get a lot is on sequencing instruments, given or you've been with the HiSeq Xs, would you expect those to be up in 2016, sequencing instruments? Jay T. Flatley - Chief Executive Officer & Director: Instruments overall or HiSeq X's?

Instruments overall, sequencing instruments overall. Jay T. Flatley - Chief Executive Officer & Director: Yeah. I don't think we're ready to give that level of guidance here today, John. We're working through right now what the components of our forecast look like for next year. I mean we do think we'll have a good instrument year next year, but we're not ready to guide to the specific growth rates of instruments versus reagents next year.

Okay. Thanks.

Our next question comes from the line of Ross Muken from Evercore.

Good afternoon, guys. Jay T. Flatley - Chief Executive Officer & Director: Hi, Ross.

You obviously launched a cancer panel in the quarter. You've got a key product on the discovery side that you talked here. Can you talk a little about, one, sort of the early market response there? And then two, what are your conversations are like with pharma partners and FDA and all the other constituents in terms of the pushes and pulls on sort of adoption of some of these type of products? Jay T. Flatley - Chief Executive Officer & Director: Sure. Well, the early indications on the TruSight Tumor 15 are very positive, as I mentioned in the script. It's too early to have any revenue slope on that. We just launched the product, so, way too early to comment with actual evidence. But the content that we put on that panel was done in collaboration with the AGC, and these are the thought leaders in the field. So we think we have the content right. The challenge, of course, with respect to the regulated markets here, is that we really need to sell this into research segments only. We can't sell this as a diagnostic product. So it'll be used initially by research and translational customers, by pharma companies as we get into the IUO phase of these products. And we're still evaluating the extent to which we decide to put this product versus the – our two product through the FDA as an IVD or whether we do both. And that decision is pending, and it depends a bit on where the FDA winds up with the LDT guidance. And I think we're going to have some updates to the LDT guidance here over the next quarter or so and that will give us a bit more visibility on how and to what extent and what…

Thanks, Jay. And maybe, Marc, just, again, not to belabor the point in repeat Tycho, but just sort of trying to understand the pacing. I guess as we think about the step-up Q4 versus Q3 on OpEx, obviously a portion of that is stock comp. I guess as we think about the other elements, it seems like some is going into commercial and then also you have your natural Q4 R&D ramp that will be sort of the jump off point for next year. And you had pretty high operating margin incrementals in Q1 and Q2 of this year. So I guess, as we think about it, should we sort of be in investment phase for at least the next several quarters and then depending on what the back half of next year is, we could see some expansion on? I'm not looking for numbers; I'm just looking sort of directionally, maybe, or qualitatively how to think through that, at least next two three quarter pacing? Marc A. Stapley - Chief Financial Officer & Senior Vice President: Yeah. Well, I think, clearly, as I mentioned, our pacing on certain investments is slightly reduced compared to where it was in the first half. But you're right, I gave you the jumping-off point. Bear in mind, that from that jumping-off point, we're going to have the full quarter effect in Q1 of the hiring in Q4, which is continuing, and we're going to have the 2016 hiring, which is part of our budget process, which we really haven't finalized yet. So I can't – I clearly can't give you any direction around that, because we're still working through it. But we're fairly going to be continuing to hire and grow our business at a certain pace yet to be determined. I look…

That's perfect guys. Thanks so much. Marc A. Stapley - Chief Financial Officer & Senior Vice President: Thanks, Ross.

Our next question comes from the line of Amanda Murphy from William Blair. Amanda L. Murphy - William Blair & Co. LLC: Hi, good afternoon. Sort of as a follow-up maybe for Francis and Marc, so, in terms of the HiSeq X Ten guidance that you gave, into the 20 unit to 30 unit shipments, and then looking at your backlog, can you help us or give us some context around what you're assuming in terms capacity expansion versus new customers? Obviously the Broad had a nice expansion there, but would expansion – or is expansion something that you're assuming in that number, or would that be upside? And then also just thinking about HiSeq X Five versus HiSeq X Ten would be helpful. Thanks. Francis A. deSouza - President & Director: Sure. So the number we gave in terms of 20 units to 30 units a quarter includes both customers that are new customers as well as customers that are coming back and expanding their fleet and we've continued to see in the previous quarters a good mix of both. And as we look at the pipeline for the future quarters, we continue to see a healthy mix again of customers that are new customers to the HiSeq X family as well as some expansions like we highlighted. So that's – that continues to be built into our plans for the HiSeq X going forward. Marc A. Stapley - Chief Financial Officer & Senior Vice President: On the HiSeq X Five, HiSeq X Ten, I mean we've always tried to guide towards not thinking about those as separate instruments within the family. Just think about the HiSeq X family. And the primary reason for that is the HiSeq X Five is often a kind of stepping stone to HiSeq…

Our next question comes from the line of Isaac Ro, from Goldman Sachs. Isaac Ro - Goldman Sachs & Co.: Hi. Good afternoon, guys. Thank you very much. I wanted to start with a question on – actually both questions on the diagnostics market opportunity. And one would be, I think, as was mentioned earlier, that there were some setbacks around reimbursement this quarter from a lot of the customers that you have. And I was wondering if you could update us on what you think you guys can do to help those customers get paid for doing more complex tests like tumor profiling, like immunosequencing, and then maybe thematically what you're hoping to see from the regulators over the next 12 months to 18 months, whatever timeframe you're comfortable with. Jay T. Flatley - Chief Executive Officer & Director: Well, there's a number of things we're doing there, Isaac. We're working through some of the trade agencies or trade consortia to begin to influence the actual regulations themselves or the reimbursement statements that came out from CMS. And so that, we hope, will have influence to get what we think is kind of misguided results there fixed. At the same time, we're doing all things that I mentioned before, trying to create standards which helps reimbursement, ultimately getting products through the FDA which assist with reimbursement as well, and clearly we're working outside the U.S. in all the other reimbursement situations to try to get products approved there. We talked a lot about what's going on in Europe with CE-IVD, and it's much easier to get our products through in Europe. And so that's a really important focus for us, particularly in NIPT. Isaac Ro - Goldman Sachs & Co.: Maybe... Francis A. deSouza - President & Director: In…

Our next question comes from the line of Dan Leonard from Leerink.

Thank you. Just a follow-up to John and then also Isaac's question, how sensitive is your 15% to 20% outlook through 2016 to progress on the reimbursement front? I mean you spiked out NIPT in Anthem, but I'm not sure what else needs to happen. Jay T. Flatley - Chief Executive Officer & Director: Well, it clearly has some sensitivity to what happens in average risk. So I'd say that's the area of sensitivity. I don't think it has much sensitivity in 2016, at least, to what happens, for example in reimbursement of cancer or oncology panel. That's still probably in the noise level for us in 2016.

Got it. Thank you.

Our next question comes from the line of Bill Quirk from Piper Jaffray. Bill R. Quirk - Piper Jaffray & Co (Broker): Great. Thanks and good afternoon everyone. Jay T. Flatley - Chief Executive Officer & Director: Hi, Bill. Bill R. Quirk - Piper Jaffray & Co (Broker): So first question, I guess, is a bit of building off of Amanda's. And so thinking about the reiterated HiSeq X placement guidance, how many potential HiSeq X customers do you think there are today, given the existing applications? And I know that we've talked at long length on different conference calls about opening up the system further, and I know you have no plans to do so now, but would that number change should you change that decision down the road? Thanks. Jay T. Flatley - Chief Executive Officer & Director: If by that you mean if we opened it up to exomes, would the number get bigger, the answer is yes. I mean the number would definitely get bigger. 25 customers is beyond – way beyond our initial expectation for this, as you know. And we continue to see customers coming forward that surprise us almost every quarter. We get a customer that – wow, we never thought that this customer would have interest in the HiSeq X technology. I do think opening up to other organisms will increase the number of customers as well. There are number of sites that, that want to do with very large-scale ag programs, and the HiSeq X technology could be the exact solution to open up some new market segments there. So we don't know what the actual number is, but certainly having 25 customers after seven quarters is a pretty darn good start. Bill R. Quirk - Piper Jaffray & Co (Broker): Very good. And then just a real quick one on Helix, Jay, any update in terms of new partners into that program? Jay T. Flatley - Chief Executive Officer & Director: None that we've announced, but we have a very rich pipeline at Helix. In fact, it's so rich now that we've begun to stop trying to bring new ones in to the ecosystem. We're trying to bring up the ones that we have and nurture the agreements with the ones that are in the pipeline. So we've got a pretty big portfolio of opportunities there and we continue to be really excited about the prospect of having a suite of applications at the time we launched this. Bill R. Quirk - Piper Jaffray & Co (Broker): Got it. Thank you.

Our next question comes from the line of Steve Beuchaw from Morgan Stanley. Steve C. Beuchaw - Morgan Stanley & Co. LLC: Hi. Thanks for taking the questions. That was a good one. Just a quick on one following up on the HiSeq X. If you look at the – let's say the workflows that you've seen historically on the HiSeq platform overall for human versus non-human whole genomes, how would you say that they compare to each other? It would just be really helpful for thinking about how the change to the operability on the HiSeq X impacts the funnel. Thanks. Jay T. Flatley - Chief Executive Officer & Director: Maybe you can clarify that for me, Steve a little bit. What do you mean the difference in the workflows? Steve C. Beuchaw - Morgan Stanley & Co. LLC: So the – in terms of the volumes, right? So, human whole genomes versus non-human whole genomes. Jay T. Flatley - Chief Executive Officer & Director: Yeah. Well, I would say that human has been the dominant part of the whole genome market for obvious reasons, that we're all trying to study human disease and make those connections, determinations about the association with genome with disease, and the impact of environment as well. The challenges are different when you're doing plants and animals. In some of the plants, the genomes aren't deployed, and so they're much more difficult genomes to sequence. But if we could sequence them routinely, then there will be a lot more sequencing going on in corn and wheat and some of the more complex crops. I think the early work that will get done here is in the animal space, probably bovine in particular. And there'll also be a lot of work done in model organism, so mouse and rat, I think, will be huge applications. And the samples there are – you can essentially get as many as you want compared to human, obviously, and you can modify those organisms in ways that let you study them as a model system that you can't do in human. So it's a very different kind of workflow – work set. That the workflow is the same, but end goal of the study is quite different. Steve C. Beuchaw - Morgan Stanley & Co. LLC: Got it. Thanks so much.

Our next question comes from the line of Bryan Brokmeier from Cantor Fitzgerald.

Hi, good afternoon. Jay, you called out the strong growth in clinical and translational demand. Could you provide some details on how that varied across the various geographies and how that might change over the coming quarters as you introduce the cancer panels into Europe, first with the CE mark, and slowly start coming into the U.S.? Jay T. Flatley - Chief Executive Officer & Director: Sure. So I'd say, the U.S. was far and away the strongest geography. If you look at NIPT specifically, Europe was very strong in NIPT because of all the tech transfer agreements we've been able to do in Europe, and of course we can't do those same types of agreements in the United States. So the clinical adoption, while the volumes tend to be lower in any given site because it's much more fragmented, the number of customers we have in Europe is way higher than those that we have in the U.S. We tend to sell more instrumentation in Europe as a result of that. Just because the geographic weakness in Japan and that the lack of clinical adoption overall there, it's been very weak market in the clinical side. China is pretty good, obviously driven by NIPT, and hopefully assumed by PGS and IVF markets as well. As we look forward, I think the adoption of the onco panels will probably again be led by the U.S. If we ever get to the point where we get an IVD approval because we think we're lined up to do that quickly and we're at a point where the technology won't be obsolete by time we ever got it through the FDA, then I think that would cause an inflection point in the curve in oncology in the U.S.

Okay. Thanks a lot.

Our next question comes from the line of Tim Evans from Wells Fargo Securities.

Thanks. Hey, Jay, you cited the competitive win – head-head to win rate as the reason giving you confidence that the issue in the desktop market is not a competitive thing. What gives you confidence, I guess, that your sales force is properly aligned and you're seeing all the opportunities out there? And I guess the second question I had was what's driving the Q4 guidance to be lower than the implied guidance that you gave last quarter? I know you said that Q4 demand was higher, I believe, than Q3 demand in the desktop markets, something you said on the last call. So what's creating the reduction in guidance there in Q4? Jay T. Flatley - Chief Executive Officer & Director: Well, we can ever never be sure that we're seeing every – accounted every sale out there, but we – I mean we have a very big sales force now, and it would be shocking if we missed more than handfuls of potential sales that happen in any given quarter. The only exception to that might be China, where it's a very big geographic market and it's impossible to cover all laboratories there. So some of our larger competitors may have more feet on the street in China, so there maybe a few opportunities that we're missing there. But around the rest of the world, we're quite confident that we're getting to all the major accounts. And including in places like Europe, many of these sales happen through tenders, so they're publicly available. So we see them and we know where the NIH grant money is going in the U.S. from the academic side. So we're pretty confident in our win rate. And Marc, you want to talk about the guidance? Marc A. Stapley - Chief Financial Officer & Senior Vice President: Yeah. I mean essentially it comes down to the things we talked about on our pre-call. And a couple of things that impacted Q3 in particular – our perspective on Japan is one of the key drivers, and then our view on our ability to get everything done that we need to get done in Europe. Europe has to grow sequentially to achieve that. And so we're very focused on making that happen. And then on the desktop – benchtop side, we're coming off a lower jumping-off point in Q3 sequentially. So I think those factors combined – this is what led us to take down – effectively take down our Q4 guidance as we went from 20% to 18% for the year.

Okay. Thank you.

I would now like to turn the call over to Rebecca Chambers for closing remarks. Rebecca Chambers - Vice President-Investor Relations & Treasury: Thanks again, Lauren. As a reminder, everyone, a replay of this call will be available as a webcast in the Investor section of our website as well as through the dial-in instructions contained in today's earnings release. Thank you for joining us today. This concludes our call and we look forward to our next update following the close of the fourth fiscal quarter.