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Labcorp (LH) Q2 Earnings: Taking a Look at Key Metrics Versus Estimates
ZACKS· 2025-07-24 18:30
Core Insights - Labcorp Holdings (LH) reported revenue of $3.53 billion for the quarter ended June 2025, marking a year-over-year increase of 9.5% and exceeding the Zacks Consensus Estimate of $3.49 billion by 1.14% [1] - The company's EPS for the same period was $4.35, up from $3.94 a year ago, and also surpassed the consensus EPS estimate of $4.14 by 5.07% [1] Financial Performance Metrics - The net book-to-bill ratio for Labcorp was 1.1%, matching the two-analyst average estimate [4] - Revenue from Biopharma Laboratory Services was $784.8 million, exceeding the average estimate of $743.2 million by four analysts, representing an 11% year-over-year increase [4] - Revenue from Diagnostics Laboratories was $2.75 billion, slightly above the estimated $2.74 billion, reflecting an 8.9% year-over-year change [4] - Adjusted Operating Income for Diagnostics Laboratories was reported at $482.8 million, compared to the average estimate of $466.41 million [4] - Adjusted Operating Income for Biopharma Laboratory Services was $123.3 million, exceeding the three-analyst average estimate of $117.62 million [4] - Unallocated corporate expenses were reported at -$74.5 million, better than the average estimate of -$78.99 million [4] Stock Performance - Labcorp's shares have returned -3.2% over the past month, contrasting with the Zacks S&P 500 composite's +5.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]
Why Is Testing Giant Labcorp Stock Surging On Thursday?
Benzinga· 2025-07-24 16:27
Core Insights - Laboratory Corp reported second-quarter 2025 adjusted earnings per share of $4.35, an increase from $3.94 a year ago, surpassing the consensus estimate of $4.17 [1] - Sales rose 9.5% year-over-year to $3.53 billion, exceeding the consensus of $3.485 billion, driven by organic revenue growth of 5.4%, acquisitions net of divestitures of 3.5%, and foreign currency translation of 0.6% [1] - Adjusted operating income for the quarter was $531.6 million, representing 15.1% of revenue [1] Financial Guidance - LabCorp raised its fiscal year 2025 adjusted earnings guidance from $15.70-$16.40 to $16.05-$16.50, compared to the consensus of $16.09 [3] - The company also increased 2025 sales guidance from $13.978 billion-$14.148 billion to $14.08 billion-$14.23 billion, compared to the consensus of $13.897 billion [3] - Forecasted sales growth for 2025 is now 7.5%-8.6%, up from prior guidance of 6.7%-8% [3] Segment Performance - The guidance includes 2025 Diagnostics Laboratories sales growth of 7%-8%, an increase from prior guidance of 6.5%-7.7% [4] - Biopharma Laboratory Services sales growth is now projected at 6.1%-7.5%, compared to prior guidance of 3.0%-5.0% [4] Market Reaction - Laboratory Corp's stock increased by 11.3% to $278.91 following the earnings report [5] - Organic growth trends in Labcorp's diagnostics segment improved quarter-over-quarter, although slightly below consensus expectations [5] Acquisitions - Labcorp announced an agreement to acquire select assets of Incyte Diagnostics' clinical and anatomic pathology testing businesses in the Pacific Northwest [7] - The company is progressing with the acquisition of select oncology and clinical testing assets from BioReference Health [7] - Labcorp acquired select assets of the outreach business from Community Health Systems across 13 states for $195 million in cash [7]
Labcorp Q2 Earnings & Revenues Beat Estimates, Stock Up in Pre-Market
ZACKS· 2025-07-24 15:50
Core Insights - Labcorp Holdings reported adjusted EPS of $4.35 for Q2 2025, a 10.4% increase year-over-year, exceeding Zacks Consensus Estimate by 5.07% [1][7] - Revenues for the quarter rose 9.5% year-over-year to $3.53 billion, also surpassing Zacks Consensus Estimate by 1.14% [2][7] - The company raised its 2025 guidance for revenues, EPS, and free cash flow based on strong business performance and currency impacts [8][9] Revenue Performance - Q2 revenues increased to $3.53 billion, driven by organic growth of 5.4%, acquisitions contributing 3.5%, and a foreign currency translation gain of 0.6% [2][7] - Diagnostics Laboratories segment reported revenues of $2.75 billion, reflecting an 8.9% year-over-year improvement [3] - Biopharma Laboratory Services revenues rose 11% to $784.8 million, primarily due to organic growth of 7.8% and a foreign currency translation gain of 3.2% [4] Margin and Operating Performance - Gross margin expanded by 90 basis points to 29.7%, despite an 8.1% rise in the cost of revenues [5] - Adjusted operating income improved by 26.7% year-over-year to $466.9 million, with adjusted operating margin expanding by 179 basis points to 13.2% [5] Cash Position - Labcorp ended Q2 with cash and cash equivalents of $647.3 million, up from $369.4 million at the end of Q1 [6] - Long-term debt decreased to $5.08 billion from $5.57 billion at the end of Q1 [6] - Cumulative cash inflow from operating activities reached $620.6 million, significantly higher than $18.5 million in the year-ago period [6] Future Outlook - Updated 2025 revenue growth guidance is now projected between 7.5%-8.6%, with Diagnostics Laboratories expected to grow 7%-8% and Biopharma Laboratory Services between 6.1% and 7.5% [8] - Full-year adjusted EPS is now expected to be in the range of $16.05-$16.50, up from the previous estimate of $15.70-$16.40 [9] - Free cash flow from continued operations is projected to be between $1.13-$1.28 billion, an increase from the earlier range of $1.10-$1.25 billion [9] Strategic Developments - During the quarter, Labcorp expanded its oncology portfolio with key product launches and enhanced partnerships with hospitals and health systems [10]
Labcorp(LH) - 2025 Q2 - Earnings Call Transcript
2025-07-24 14:02
Financial Data and Key Metrics Changes - Enterprise revenue reached $3.5 billion, representing a 10% growth year-over-year [7] - Diagnostics revenue grew 9% to $2.7 billion, driven by both organic growth and acquisitions [8] - Adjusted earnings per share increased by 10% year-over-year to $4.35 [9] - Operating income for the quarter was $395 million, or 11.2% of revenue, with adjusted operating income at $532 million, or 15.1% of revenue [19] - Free cash flow for the quarter was $543 million, up from $433 million last year [21] Business Line Data and Key Metrics Changes - Diagnostics Laboratories revenue increased by 8.9% to $2.7 billion, with organic growth of 4.5% and acquisitions also contributing 4.5% [22] - Biopharma Laboratory Services revenue grew by 11% to $785 million, with organic revenue growth of 7.8% [25] - Early Development segment grew by 20% or 18% in constant currency, while Central Laboratories grew by 8% or 4% in constant currency [8][26] Market Data and Key Metrics Changes - The quarterly book-to-bill ratio was strong at 1.18, with a trailing twelve-month ratio of 1.11 [9][27] - The company ended the quarter with a backlog of $8.7 billion, expecting approximately $2.7 billion of this backlog to convert into revenue over the next twelve months [27] Company Strategy and Development Direction - The company aims to be the partner of choice for health systems and regional laboratories, expanding its presence in hospitals and strengthening customer relationships [10] - Focus on launching new and innovative tests in specialty areas such as oncology, women's health, and neurology to accelerate growth [12] - Continued investment in technology and operational efficiencies to enhance customer and employee experiences [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver sustainable growth and long-term value for shareholders [30] - The company raised its full-year guidance for enterprise revenue, adjusted EPS, and free cash flow, driven by strong underlying business performance [28] - Management acknowledged potential risks from legislative and regulatory changes but believes the overall impact is manageable [41][48] Other Important Information - The company invested $25 million in acquisitions and partnerships during the quarter and repurchased $200 million of stock [22] - The adjusted tax rate for the quarter was 23.1%, with expectations to remain around 23% for the full year [20] Q&A Session Summary Question: Volume dynamics and growth strategies - Management noted that about half of the 9% growth in diagnostics revenue came from organic growth, with strong performance in hospital partnerships and specialty products driving accelerated growth [34][37] Question: Legislative and regulatory outlook - Management is actively working on legislative solutions regarding PAMA and believes the overall impact of regulatory changes is manageable [42][48] Question: Community health deal details - The community health deal is expected to be accretive in the first year and is part of a broader strategy to enhance inorganic growth [56][58] Question: BLS segment performance - Management highlighted strong growth in both Central Labs and Early Development, with a focus on maintaining momentum in the second half of the year [63][66] Question: Managed care contracting - Management expressed confidence in renewing managed care contracts and maintaining reasonable terms and rates [71][72] Question: Invitae deal performance - Management reported strong integration and revenue growth from the Invitae deal, with expectations for it to be slightly accretive for the full year [78][80] Question: BLS market dynamics - Management noted strength in both biotech and pharma sectors, with a focus on maintaining growth in early development and central lab services [84][86]
Labcorp(LH) - 2025 Q2 - Earnings Call Transcript
2025-07-24 14:00
Financial Data and Key Metrics Changes - Enterprise revenue reached $3.5 billion, representing a 10% growth year-over-year [6][17] - Diagnostics revenue grew 9% to $2.7 billion, driven by both organic growth and acquisitions [7][21] - Adjusted earnings per share (EPS) increased by 10% to $4.35 [8][19] - Operating cash flow was $621 million, up from $561 million a year ago [20] Business Line Data and Key Metrics Changes - Diagnostics Laboratories revenue was $2.7 billion, an increase of 8.9% year-over-year, with organic growth of 4.5% [21][22] - Biopharma Laboratory Services (BLS) revenue grew 11% to $785 million, with organic revenue growth of 7.8% [23][24] - Early Development in BLS grew 20% or 18% in constant currency, while Central Laboratories grew 8% or 4% in constant currency [7][24] Market Data and Key Metrics Changes - The quarterly book-to-bill ratio was strong at 1.18, with a trailing twelve-month ratio of 1.11 [8][25] - The company ended the quarter with a backlog of $8.7 billion, expecting approximately $2.7 billion to convert into revenue over the next twelve months [25] Company Strategy and Development Direction - The company aims to be the partner of choice for health systems and local laboratories, expanding its presence and strengthening customer relationships [9][10] - Focus on launching innovative tests in specialty areas such as oncology, women's health, and neurology to accelerate growth [12][14] - The company is enhancing customer and employee experiences through technology and operational efficiencies [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver sustainable growth and long-term value for shareholders [29] - The company raised its full-year guidance for enterprise revenue, adjusted EPS, and free cash flow, driven by strong business performance and favorable foreign exchange rates [26][28] Other Important Information - The company invested $25 million in acquisitions and partnerships, paid out $60 million in dividends, and repurchased $200 million of stock during the quarter [21] - Total debt was $5.6 billion, with a debt leverage of 2.5x gross debt to trailing twelve months adjusted EBITDA [21] Q&A Session Summary Question: Volume dynamics and growth strategies - Management highlighted that about half of the 9% growth in diagnostics revenue came from organic growth, with strong performance in hospital deals and specialty products driving accelerated growth [30][32] Question: Legislative and regulatory outlook - Management discussed ongoing efforts to address PAMA and the potential impact of legislative changes on the business, indicating that the overall impact is manageable [39][42] Question: Community health deal details - The community health deal is expected to be accretive in the first year and is part of a broader strategy to enhance inorganic growth [51][53] Question: BLS segment performance - Management noted strong growth in both Central Labs and Early Development, with a focus on maintaining momentum and monitoring customer engagement [58][60] Question: Managed care contracting - Management confirmed that unit prices remain relatively flat and expressed confidence in securing reasonable terms for contract renewals [67][68] Question: Invitae deal performance - Management reported confidence in the integration of Invitae, expecting revenue growth of 10% and slight accretion for the full year [73][75] Question: Specialty testing opportunities - Management emphasized the importance of a broad range of tests in specialty areas, indicating a strategic focus on oncology and Alzheimer's disease [94][96]
Labcorp Holdings (LH) Q2 Earnings and Revenues Top Estimates
ZACKS· 2025-07-24 13:01
Core Insights - Labcorp Holdings (LH) reported quarterly earnings of $4.35 per share, exceeding the Zacks Consensus Estimate of $4.14 per share, and up from $3.94 per share a year ago, representing an earnings surprise of +5.07% [1] - The company achieved revenues of $3.53 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.14%, and an increase from $3.22 billion year-over-year [2] - Labcorp has consistently outperformed consensus EPS estimates over the last four quarters, achieving this four times [2] Earnings Outlook - The future performance of Labcorp's stock will largely depend on management's commentary during the earnings call and the sustainability of the stock's immediate price movement based on the recently released numbers [3][4] - The current consensus EPS estimate for the upcoming quarter is $4.07 on revenues of $3.53 billion, while for the current fiscal year, the estimate is $16.05 on revenues of $13.91 billion [7] Industry Context - The Medical Services industry, to which Labcorp belongs, is currently ranked in the top 39% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Another company in the same industry, IceCure Medical Ltd. (ICCM), is expected to report a quarterly loss of $0.06 per share, with revenues projected to decline by 20.8% year-over-year [9]
Labcorp(LH) - 2025 Q2 - Earnings Call Presentation
2025-07-24 13:00
Financial Performance - Q2 2025 - Total Adjusted EBITDA for Q2 2025 was $627.8 million[6], compared to $574.6 million in Q2 2024[6], an increase - The company's Q2 2025 revenue, as reported, reached $3.5273 billion[21], a 9.5% increase year-over-year from $3.2209 billion in Q2 2024[21] - Adjusted earnings per share for Q2 2025 was $4.35[23], compared to $3.94 in Q2 2024[23] Revenue Breakdown and Growth - Enterprise revenue, as reported, for Q2 2025 was $3.527 billion[8], reflecting a 9.5% year-over-year growth[8] - Diagnostics Laboratories revenue, as reported, for Q2 2025 was $2.749 billion[8], showing an 8.9% year-over-year growth[8] - Biopharma Laboratory Services revenue, as reported, for Q2 2025 was $785 million[8], a significant 11% increase year-over-year[8] Outlook for 2025 - The company projects full-year 2025 revenue for Labcorp Enterprise to be between $13.98 billion and $14.13 billion[18], representing a 7.5% to 8.6% increase versus 2024 results[18] - The company anticipates adjusted EPS for 2025 to be in the range of $16.05 to $16.50[18], a 10.1% to 13.2% increase compared to 2024[18] Biopharma Laboratory Services Metrics - The Trailing Twelve Month (TTM) Net Orders ending June 30, 2025, for Biopharma Laboratory Services reached $3.34 billion[17], with a Net Book-to-Bill ratio of 1.11x[17] - As of June 30, 2025, the backlog for Biopharma Laboratory Services was $8.71 billion[17], with an estimated $2.71 billion expected to convert to revenue in the next twelve months[17]
Labcorp(LH) - 2025 Q2 - Quarterly Results
2025-07-24 10:52
BURLINGTON, N.C., July 24, 2025 – Labcorp (NYSE: LH), a global leader of innovative and comprehensive laboratory services, today announced results for the second quarter ended June 30, 2025 and raised full-year guidance. FOR IMMEDIATE RELEASE Media Investors Neil Hirsch Christin O'Donnell Media@labcorp.com Investor@labcorp.com Labcorp Announces 2025 Second Quarter Results Raises Full-Year Guidance "Labcorp had a very strong second quarter, delivering double-digit topline growth, while expanding margins acro ...
Labcorp Announces 2025 Second Quarter Results
Prnewswire· 2025-07-24 10:50
Core Insights - Labcorp reported strong second-quarter results for 2025, achieving double-digit topline growth and margin expansion across both segments, leading to an increase in full-year guidance [2][3][4]. Financial Performance - Total revenue for Q2 2025 was $3.53 billion, a 9.5% increase from $3.22 billion in Q2 2024 [5][7]. - Diluted EPS rose to $2.84 from $2.43 year-over-year, while adjusted EPS increased to $4.35 from $3.94 [7][9]. - Operating income for Q2 2025 was $394.5 million, compared to $294.8 million in Q2 2024, reflecting a margin of 11.2% [6][30]. Guidance Update - Labcorp raised its 2025 guidance for enterprise revenue to a range of 7.5% to 8.6%, with the midpoint raised by 70 basis points [4][19]. - Adjusted EPS guidance was updated to a range of $16.05 to $16.50, with the midpoint raised by $0.23 [19][20]. - Free cash flow guidance was adjusted to a range of $1.13 billion to $1.28 billion, with the midpoint raised by $25 million [19][20]. Strategic Initiatives - The company expanded partnerships with hospitals and health systems, enhancing access to comprehensive testing and laboratory services [7][8]. - Labcorp introduced several innovative tests in high-growth areas, including oncology and Alzheimer's disease diagnostics [8][26]. - The company announced agreements to acquire select assets from Incyte Diagnostics and BioReference Health, further strengthening its market position [8][19]. Capital Allocation - Labcorp declared a quarterly cash dividend of $0.72 per share, payable on September 11, 2025 [4]. - The company repurchased $200 million of common stock during the quarter [4][15]. - As of June 30, 2025, Labcorp's cash and cash equivalents stood at $0.65 billion, with total debt at $5.58 billion [15][32].
What Analyst Projections for Key Metrics Reveal About Labcorp (LH) Q2 Earnings
ZACKS· 2025-07-21 14:21
Core Viewpoint - Labcorp Holdings (LH) is expected to report quarterly earnings of $4.14 per share, reflecting a 5.1% increase year-over-year, with revenues projected at $3.49 billion, an 8.3% increase from the previous year [1]. Earnings Estimates - The consensus EPS estimate has been revised down by 0.1% in the last 30 days, indicating a reassessment by analysts [2]. - Revisions to earnings projections are crucial for predicting investor behavior and are linked to short-term stock price performance [3]. Revenue Projections - Analysts estimate 'Revenues- Biopharma Laboratory Services' at $743.20 million, a 5.1% increase from the prior-year quarter [5]. - The average estimate for 'Revenues- Diagnostics Laboratories' is $2.74 billion, reflecting an 8.7% increase year-over-year [5]. Operating Income Estimates - 'Adjusted Operating Income- Biopharma Laboratory Services' is projected to reach $117.62 million, up from $107.40 million in the same quarter last year [6]. - 'Adjusted Operating Income- Diagnostics Laboratories' is expected to be $466.41 million, compared to $441.50 million a year ago [6]. Stock Performance - Labcorp shares have returned -6.9% over the past month, contrasting with the Zacks S&P 500 composite's +5.4% change [6]. - The company holds a Zacks Rank 3 (Hold), suggesting it is expected to perform in line with the overall market in the near future [6].