Affymetrix's self-diagnosis

With revenues flat since 2004, Affymetrix Inc. began implementing a three-point plan in 2007 to restore its growth and profitability by reengineering its technology platform; consolidating operations and cutting costs to improve its bottom line; and acquiring new technologies to expand into new markets. The microarray company's recent agreement to acquire Panomics Inc. is part of a plan to strengthen its position in what it sees as high-growth diagnostic markets that are downstream of its traditional research market.

The lion's share of Affymetrix's revenues come from DNA microarray and reagent sales for use in gene association studies. In 3Q08, the company reported $75.2 million in revenues, $59.8 million of which came from array and reagent sales. The rest came from instrument sales ($6.2 million), service revenue ($6.1 million) and royalties and other revenue ($3.1 million)...