8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):
January 30, 2003 (January 30, 2003)

AFFYMETRIX, INC.

(Exact name of registrant as specified in its charter)

DELAWARE	0-28218	77-0319159
(State of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

3380 Central Expressway, Santa Clara, California 95051

(Address of principal executive offices) (Zip Code)

(408) 731-5000

(Registrant’s telephone number, including area code)

N/A
(Former name or former address, if changed since last report)

Item 7.    FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.

(c)           Exhibits

The following exhibit is filed herewith:

Exhibit Number	Description
99.1	2002 Unaudited Adjusted Condensed Consolidated Statements of Operations for Illustrative Purposes Only (in thousands, except per share amounts)

Item 9. REGULATION FD DISCLOSURE.

Affymetrix, Inc. (“Affymetrix”) has posted on its website an Unaudited Adjusted Condensed Consolidated Statements of Operations for 2002 to illustrate what the impact would have been on Affymetrix’ 2002 Statements of Operations as the result of two changes in Affymetrix’ business that have occurred effective January 2003.  First, beginning in January 2003, Affymetrix will reclassify future revenues earned from customers for custom chip design services from research revenue into product revenue due to the fact that Affymetrix has fully commercialized its custom product offering.  Second, beginning in January 2003, Affymetrix switched from a distributor based sales model in Japan to a direct sales model.  The impact of this change is that effective January 2003, Affymetrix will sell its products through its direct sales force at the end user price and will not record any distributor commission as a net against product revenue as it had done in 2002.  These statements do not purport to reflect what Affymetrix’ actual results would have been had the changes been implemented in January 2002.  The information contained in this Current Report on Form 8-K, including the exhibit, has not been audited by Affymetrix’ outside auditors.

This Current Report on Form 8-K, including the exhibit, includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934.  Such forward-looking statements are based on current expectations and involve inherent risks and uncertainties, including factors that could cause actual outcomes and results to differ materially from current expectations.  For more information regarding potential risks, see the risk factors section of Affymetrix’ most recent report on Form 10-K and Form 10-Q on file with the SEC.  Affymetrix undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date hereof.

The information contained in Item 9 of this Current Report on Form 8-K, including the exhibit, shall not be deemed to be incorporated by reference into Affymetrix’ filings with the SEC under the Securities Act of 1933.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	AFFYMETRIX, INC.
	By:	/s/ Gregory T. Schiffman
		Name: Gregory T. Schiffman
		Title: Senior Vice President and Chief Financial Officer
Date: January 30, 2003

EXHIBIT INDEX

Exhibit Number	Description
99.1	2002 Unaudited Adjusted Condensed Consolidated Statements of Operations for Illustrative Purposes Only (in thousands, except per share amounts)

EX-99.1

Exhibit 99.1

AFFYMETRIX, INC.

UNAUDITED ADJUSTED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

FOR ILLUSTRATIVE PURPOSES ONLY

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

The unaudited Adjusted Condensed Consolidated Statements of Operations shown below are presented for illustrative purposes only.  All reclassifications and adjustments had no impact on reported net income for any of the periods presented.  These statements illustrate what the impact would have been on the Company’s 2002 Statements of Operations as the result of two changes in the Company’s business that have occurred effective January 2003.  First, beginning in January 2003, the Company will reclassify future revenues earned from customers for custom chip design services from research revenue into product revenue due to the fact that the Company has fully commercialized its custom product offering.  Second, beginning in January 2003, the Company switched from a distributor based sales model in Japan to a direct sales model.  The impact of this change is that effective January 2003, Affymetrix will sell its products through its direct sales force at the end user price and will not record any distributor commission as a net against product revenue as it had done in 2002.  These statements do not purport to reflect what the Company's actual results would have been had the changes been implemented in January 2002.

	2002
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Full Year
Revenue:
Product (1) (2)	$	59,906		$	60,886		$	66,460		$	72,595		$	259,847
Revenue from Perlegen	5,971			5,615			4,868			5,105			21,559
Research (1)	403			488			374			504			1,769
License fees and royalties	3,314			5,010			2,411			1,760			12,495
Total revenue	69,594			71,999			74,113			79,964			295,670
Costs and expenses:
Cost of product revenue (3)	21,560			21,667			23,759			25,188			92,174
Cost of Perlegen revenue	5,971			5,615			4,868			4,546			21,000
Research and development (3)	15,823			16,691			15,202			17,945			65,661
Selling, general and administrative (2)	24,948			24,328			26,269			26,511			102,056
Amortization of deferred stock compensation	3,707			1,934			1,966			781			8,388
Amortization of purchased intangibles	281			281			282			281			1,125
Total costs and expenses	72,290			70,516			72,346			75,252			290,404
Income (loss) from operations	(2,696		)	1,483			1,767			4,712			5,266
Interest and other (expense) income, net	(685		)	(2,866		)	(948		)	(1,696		)	(6,195		)
Income (loss) before income taxes	(3,381		)	(1,383		)	819			3,016			(929		)
Income tax provision	(200		)	(201		)	(200		)	(100		)	(701		)
Net income (loss)	$	(3,581	)	$	(1,584	)	$	619		$	2,916		$	(1,630	)
Basic earnings (loss) per common share	$	(0.06	)	$	(0.03	)	$	0.01		$	0.05		$	(0.03	)
Diluted earnings (loss) per common share	$	(0.06	)	$	(0.03	)	$	0.01		$	0.05		$	(0.03	)
Shares used in computing basic earnings (loss) per common share	57,809			57,922			58,075			58,265			58,018
Shares used in computing diluted earnings (loss) per common share	57,809			57,922			59,539			60,460			58,018

(1) Product revenue and research revenue have been adjusted to illustrate the reclassification of revenues associated with the fees earned from customers for custom chip design services from research revenue into product revenue.  This reclassification amounted to approximately $1.2 million in the first quarter, $0.9 million in the second quarter, $2.2 million in the third quarter, $1.2 million in the fourth quarter, for a total aggregate of $5.5 million.

(2) In order to compare 2002 results to future results in the product revenue and selling, general and administrative expense categories, the Company has adjusted both 2002 product revenue and 2002 selling, general and administrative expense by the amount of commission actually paid to its Japanese distributor.  These expenses reflect costs associated with the Company’s business in Japan and were appropriately netted against product revenue during 2002.  Beginning in January 2003, the Company expects to record revenue from its Japanese subsidiary at the end customer sales price as all sales will be sold through Affymetrix’ Japanese subsidiary rather than through its distributor.  The Company believes, that by adjusting 2002 product revenue to reflect the end-customer sales price, an improved comparison to future product revenues will be possible. In addition, the Company believes that by adjusting 2002 selling, general and administrative expenses to reflect the commissions expense incurred, an improved comparison of future selling, general and administrative expenses will be possible. Commission expenses were approximately $1.5 million in Q1, $1.3 million in Q2, $1.3 million in Q3, $1.7 million in Q4 for a total aggregate of $5.8 million.

(3) Research and development expense and cost of product revenue have been adjusted to illustrate the reclassification of activities associated with the fees earned from customers for custom chip design services from research and development expense to cost of product revenue.  Historically, these activities had been recorded as part of research and development expense.  Beginning in 2003, the Company will classify these activities as costs of product revenue.  This reclassification amounted to approximately $0.9 million in the first quarter, $0.6 million in the second quarter, $1.5 million in the third quarter, $0.8 million in the fourth quarter for a total aggregate of $3.8 million.