IQVIA(IQV) - 2025 Q2 - Quarterly Results

Company Overview & Executive Summary IQVIA, a global leader in life sciences and healthcare intelligence, reported strong second-quarter financial results with revenue exceeding targets and improved demand indicators in clinical development Company Description IQVIA Holdings Inc. is a global leader in clinical research services, commercial insights, and healthcare intelligence, serving the life sciences and healthcare industries - IQVIA is a global leader in clinical research services, commercial insights, and healthcare intelligence, serving the life sciences and healthcare industries[2] CEO Commentary IQVIA's Chairman and CEO, Ari Bousbib, highlighted strong second-quarter financial results with revenue exceeding targets and profit near the upper end of expectations, driven by robust TAS performance and improved clinical development demand indicators - IQVIA reported strong second-quarter financial results, with revenue exceeding targets and profit near the upper end of expectations[6] - The TAS segment achieved high single-digit year-over-year growth, while forward-looking demand indicators for clinical development improved, with net bookings up 15% sequentially and RFP flow showing high single-digit sequential growth and low double-digit year-over-year growth[6] Second-Quarter 2025 Financial Results IQVIA reported strong second-quarter 2025 financial results with total revenue of $4.017 billion, a 2.6% increase in Adjusted EBITDA, and a robust R&D Solutions contract backlog of $32.1 billion Revenue Performance IQVIA achieved total revenue of $4.017 billion in the second quarter of 2025, growing 5.3% on a reported basis and 3.6% at constant currency, with significant growth in Technology & Analytics Solutions (TAS) revenue Second-Quarter 2025 Revenue Performance | Indicator | Amount (Millions USD) | Y-o-Y Growth (Reported Basis) | Y-o-Y Growth (Constant Currency) | | :--- | :--- | :--- | :--- | | Total Revenue | 4,017 | 5.3% | 3.6% | | TAS Revenue | 1,628 | 8.9% | 6.8% | | R&DS Revenue | 2,201 | 2.5% | 1.3% | | CSMS Revenue | 188 | 9.3% | 6.4% | - Excluding reimbursement revenue, R&DS revenue grew 1.8% on a reported basis[3] Profitability and Earnings Per Share Second-quarter GAAP net income was $266 million with diluted EPS of $1.54, while Adjusted EBITDA increased 2.6% to $910 million, reflecting strong adjusted net income and diluted EPS performance Second-Quarter 2025 Profitability and Earnings | Indicator | Amount (Millions USD) | Y-o-Y Growth | | :--- | :--- | :--- | | GAAP Net Income | 266 | -26.7% | | GAAP Diluted EPS | 1.54 | -21.9% | | Adjusted EBITDA | 910 | 2.6% | | Adjusted Net Income | 486 | -0.2% | | Adjusted Diluted EPS | 2.81 | 6.4% | R&D Solutions Backlog and Bookings As of June 30, 2025, R&D Solutions (R&DS) contract backlog reached $32.1 billion, a 5.1% year-over-year increase, with net new bookings of $2.5 billion and a book-to-bill ratio of 1.12x in the second quarter R&D Solutions Backlog and Bookings as of June 30, 2025 | Indicator | Amount (Billions USD) | Y-o-Y Growth (Reported Basis) | Y-o-Y Growth (Constant Currency) | | :--- | :--- | :--- | :--- | | R&DS Contract Backlog | 32.1 | 5.1% | 3.2% | | Estimated Revenue Conversion in Next 12 Months | 8.1 | 4.8% | - | | Q2 Net New Bookings | 2.5 | - | - | | Q2 Book-to-Bill Ratio | 1.12x | - | - | | LTM Book-to-Bill Ratio | 1.10x | - | - | First-Half 2025 Financial Results IQVIA's first-half 2025 financial results show total revenue of $7.846 billion, with TAS revenue growing 7.7%, and Adjusted EBITDA reaching $1.793 billion alongside strong adjusted earnings per share Revenue Performance (First Half) Total revenue for the first half of 2025 was $7.846 billion, increasing 3.9% on a reported basis and 3.5% at constant currency, with TAS revenue growing 7.7% and modest increases in R&DS and CSMS First-Half 2025 Revenue Performance | Indicator | Amount (Millions USD) | Y-o-Y Growth (Reported Basis) | Y-o-Y Growth (Constant Currency) | | :--- | :--- | :--- | :--- | | Total Revenue | 7,846 | 3.9% | 3.5% | | TAS Revenue | 3,174 | 7.7% | 7.2% | | R&DS Revenue | 4,303 | 1.4% | 1.2% | | CSMS Revenue | 369 | 2.2% | 1.9% | Profitability and Earnings Per Share (First Half) First-half 2025 GAAP net income was $515 million with diluted EPS of $2.94, while Adjusted net income reached $965 million, Adjusted diluted EPS was $5.50, and Adjusted EBITDA totaled $1.793 billion First-Half 2025 Profitability and Earnings | Indicator | Amount (Millions USD) | | :--- | :--- | | GAAP Net Income | 515 | | GAAP Diluted EPS | 2.94 | | Adjusted Net Income | 965 | | Adjusted Diluted EPS | 5.50 | | Adjusted EBITDA | 1,793 | Financial Position and Cash Flow As of June 30, 2025, IQVIA maintained a strong financial position with $2.039 billion in cash, generating $443 million in operating cash flow during Q2, and reporting a net leverage ratio of 3.61x Balance Sheet Overview As of June 30, 2025, IQVIA reported cash and cash equivalents of $2.039 billion, total debt of $15.490 billion, and net debt of $13.451 billion Balance Sheet Highlights as of June 30, 2025 | Indicator | Amount (Millions USD) | | :--- | :--- | | Cash and Cash Equivalents | 2,039 | | Total Debt | 15,490 | | Net Debt | 13,451 | Cash Flow Activities Second-quarter operating cash flow was $443 million, resulting in $292 million of free cash flow Second-Quarter 2025 Cash Flow | Indicator | Amount (Millions USD) | | :--- | :--- | | Q2 Operating Cash Flow | 443 | | Q2 Free Cash Flow | 292 | Leverage Ratios As of June 30, 2025, IQVIA's net leverage ratio stood at 3.61x, with a gross leverage ratio of 4.16x Leverage Ratios as of June 30, 2025 | Indicator | Ratio | | :--- | :--- | | Net Leverage Ratio | 3.61x | | Gross Leverage Ratio | 4.16x | Share Repurchase Program In the second quarter of 2025, IQVIA repurchased $607 million of common stock, with cumulative first-half repurchases totaling $1.032 billion, and $1.981 billion remaining under authorization as of June 30 Share Repurchase Activity | Indicator | Amount (Millions USD) | | :--- | :--- | | Q2 Share Repurchases | 607 | | H1 Share Repurchases | 1,032 | | Remaining Repurchase Authorization | 1,981 | Full-Year 2025 Guidance IQVIA updated its full-year 2025 guidance, projecting revenue between $16.1 billion and $16.3 billion, Adjusted EBITDA between $3.75 billion and $3.825 billion, and Adjusted diluted EPS between $11.75 and $12.05, factoring in COVID-related revenue decline, foreign exchange tailwinds, and acquisition contributions Full-Year 2025 Financial Guidance | Indicator | Full-Year 2025 Guidance (Millions USD) | | :--- | :--- | | Revenue | 16,100 - 16,300 | | Adjusted EBITDA | 3,750 - 3,825 | | Adjusted Diluted EPS | 11.75 - 12.05 | - Revenue guidance assumes approximately $100 million in COVID-related revenue decline (all from R&DS), about 100 basis points of foreign exchange tailwind, and approximately 150 basis points of acquisition contribution[12] - All financial guidance assumes foreign currency exchange rates as of July 21, 2025, remain constant throughout the forecast period[13] Conference Call Details IQVIA will host a conference call today at 9:00 AM ET to discuss second-quarter 2025 results and provide third-quarter and full-year guidance, with webcast and presentation slides available on the investor relations website - The conference call will be held at 9:00 AM ET to discuss second-quarter results and provide third-quarter and full-year guidance[14] - Investors can access the webcast and presentation slides via IQVIA's investor relations website at http://ir.iqvia.com or register to participate in the conference call[14] About IQVIA IQVIA is a global leader in clinical research services, commercial insights, and healthcare intelligence, powered by IQVIA Connected Intelligence™ and a global workforce of approximately 90,000 employees dedicated to advancing innovative medical treatments and improving global health outcomes - IQVIA provides clinical research services, commercial insights, and healthcare intelligence, with solutions powered by IQVIA Connected Intelligence™ combining health data, AI, analytics, and technology[15] - The company employs approximately 90,000 people in over 100 countries, dedicated to accelerating the development and commercialization of innovative medical treatments to improve patient outcomes and global population health[15] - IQVIA is a global leader in protecting patient privacy, utilizing privacy-enhancing technologies and safeguards to help healthcare stakeholders identify disease patterns and correlate treatment paths[15] Legal and Non-GAAP Disclosures This section provides cautionary statements regarding forward-looking information and clarifies the use of non-GAAP financial measures as supplementary to GAAP, emphasizing their role in understanding operational performance Cautionary Statements Regarding Forward-Looking Statements This press release contains forward-looking statements, including full-year 2025 guidance, where actual results may differ materially due to various factors such as natural disasters, pandemics, contract termination risks, and market growth shortfalls - This press release contains forward-looking statements, and actual results may differ materially from expectations due to various factors[16] - Risk factors include business disruptions (e.g., pandemics, conflicts), contract terminations, failure to achieve market growth, data use restrictions, security breaches, intellectual property risks, global operational risks, and changes in economic conditions and tax laws[16] Note on Non-GAAP Financial Measures This press release includes non-GAAP financial measures like Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow, presented as supplementary to GAAP to enhance understanding of the company's financial performance and underlying operational results - This press release includes non-GAAP financial measures such as Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow, presented as supplementary to GAAP financial statements[17] - The company uses non-GAAP measures to focus on the underlying operating performance of the business, excluding certain items like amortization of acquisition-related intangible assets[17] - Non-GAAP measures are not GAAP-recognized terms, should not be considered in isolation or as a substitute for GAAP analysis, and may not be comparable to similarly titled measures used by other companies[17][19] Condensed Consolidated Financial Statements This section presents the preliminary unaudited condensed consolidated financial statements, including statements of income, balance sheets, cash flows, and reconciliations for non-GAAP measures, providing a comprehensive overview of IQVIA's financial performance and position Statements of Income This section provides IQVIA Holdings Inc. and subsidiaries' preliminary unaudited condensed consolidated statements of income for the three and six months ended June 30, 2025, detailing key financial metrics such as revenue, costs, expenses, operating income, net income, and earnings per share IQVIA HOLDINGS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (preliminary and unaudited) | (in millions, except per share data) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $4,017 | $3,814 | $7,846 | $7,551 | | Cost of revenues, exclusive of depreciation and amortization | 2,694 | 2,488 | 5,225 | 4,932 | | Selling, general and administrative expenses | 509 | 509 | 1,017 | 1,017 | | Depreciation and amortization | 276 | 269 | 541 | 533 | | Restructuring costs | 32 | 28 | 61 | 43 | | Income from operations | 506 | 520 | 1,002 | 1,026 | | Interest income | (10) | (12) | (21) | (23) | | Interest expense | 182 | 163 | 347 | 329 | | Loss on extinguishment of debt | — | — | 4 | — | | Other expense (income), net | 11 | (67) | 26 | (56) | | Income before income taxes and equity in (losses) earnings of unconsolidated affiliates | 323 | 436 | 646 | 776 | | Income tax expense | 56 | 75 | 117 | 124 | | Income before equity in (losses) earnings of unconsolidated affiliates | 267 | 361 | 529 | 652 | | Equity in (losses) earnings of unconsolidated affiliates | (1) | 2 | (14) | (1) | | Net income | $266 | $363 | $515 | $651 | | Earnings per share attributable to common stockholders: | | | | | | Basic | $1.55 | $1.99 | $2.96 | $3.58 | | Diluted | $1.54 | $1.97 | $2.94 | $3.53 | | Weighted average common shares outstanding: | | | | | | Basic | 171.8 | 182.2 | 173.7 | 182.0 | | Diluted | 173.2 | 184.3 | 175.3 | 184.3 | Balance Sheets This section presents IQVIA Holdings Inc. and subsidiaries' preliminary unaudited condensed consolidated balance sheets, outlining assets, liabilities, and stockholders' equity as of June 30, 2025, and December 31, 2024 IQVIA HOLDINGS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (preliminary and unaudited) | (in millions, except per share data) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | ASSETS | | | | Current assets: | | | | Cash and cash equivalents | $2,039 | $1,702 | | Trade accounts receivable and unbilled services, net | 3,344 | 3,204 | | Prepaid expenses | 200 | 154 | | Income taxes receivable | 62 | 36 | | Investments in debt, equity and other securities | 149 | 141 | | Other current assets and receivables | 551 | 592 | | Total current assets | 6,345 | 5,829 | | Property and equipment, net | 536 | 535 | | Operating lease right-of-use assets | 280 | 238 | | Investments in debt, equity and other securities | 134 | 108 | | Investments in unconsolidated affiliates | 272 | 266 | | Goodwill | 15,611 | 14,710 | | Other identifiable intangibles, net | 4,596 | 4,499 | | Deferred income taxes | 345 | 194 | | Deposits and other assets, net | 513 | 520 | | Total assets | $28,632 | $26,899 | | LIABILITIES AND STOCKHOLDERS' EQUITY | | | | Current liabilities: | | | | Accounts payable and accrued expenses | $3,399 | $3,684 | | Unearned income | 2,123 | 1,779 | | Income taxes payable | 124 | 156 | | Current portion of long-term debt | 1,313 | 1,145 | | Other current liabilities | 613 | 193 | | Total current liabilities | 7,572 | 6,957 | | Long-term debt, less current portion | 14,177 | 12,838 | | Deferred income taxes | 216 | 196 | | Operating lease liabilities | 210 | 173 | | Other liabilities | 671 | 668 | | Total liabilities | 22,846 | 20,832 | | Commitments and contingencies | | | | Stockholders' equity: | | | | Common stock and additional paid-in capital, 400.0 shares authorized as of June 30, 2025 and December 31, 2024, $0.01 par value, 258.5 shares issued and 170.0 shares outstanding as of June 30, 2025; 258.2 shares issued and 176.1 shares outstanding as of December 31, 2024 | 11,225 | 11,143 | | Retained earnings | 6,580 | 6,065 | | Treasury stock, at cost, 88.5 and 82.1 shares as of June 30, 2025 and December 31, 2024, respectively | (11,145) | (10,103) | | Accumulated other comprehensive loss | (882) | (1,038) | | Equity attributable to IQVIA Holdings Inc.'s stockholders | 5,778 | 6,067 | | Noncontrolling interests | 8 | — | | Total stockholders' equity | 5,786 | 6,067 | | Total liabilities and stockholders' equity | $28,632 | $26,899 | Statements of Cash Flows This section provides IQVIA Holdings Inc. and subsidiaries' preliminary unaudited condensed consolidated statements of cash flows for the six months ended June 30, 2025, detailing cash flows from operating, investing, and financing activities IQVIA HOLDINGS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (preliminary and unaudited) | (in millions) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Operating activities: | | | | Net income | $515 | $651 | | Adjustments to reconcile net income to cash provided by operating activities: | | | | Depreciation and amortization | 541 | 533 | | Amortization of debt issuance costs and discount | 11 | 11 | | Stock-based compensation | 132 | 104 | | Losses from unconsolidated affiliates | 14 | 1 | | Gain on investments, net | (16) | (12) | | Benefit from deferred income taxes | (86) | (80) | | Changes in operating assets and liabilities: | | | | Change in accounts receivable, unbilled services and unearned income | 269 | 187 | | Change in other operating assets and liabilities | (369) | (285) | | Net cash provided by operating activities | 1,011 | 1,110 | | Investing activities: | | | | Acquisition of property, equipment and software | (293) | (288) | | Acquisition of businesses, net of cash acquired | (315) | (221) | | Sales of marketable securities, net | 2 | — | | Investments in unconsolidated affiliates, net of payments received | (27) | (49) | | Investments in debt and equity securities | (19) | (2) | | Proceeds from sale of property, equipment and software | — | 25 | | Other | 1 | — | | Net cash used in investing activities | (651) | (535) | | Financing activities: | | | | Proceeds from issuance of debt | 3,985 | — | | Payment of debt issuance costs | (35) | — | | Repayment of debt and principal payments on finance leases | (2,140) | (86) | | Proceeds from revolving credit facility | 875 | 375 | | Repayment of revolving credit facility | (1,700) | (585) | | Payments related to employee stock incentive plans | (35) | (60) | | Repurchase of common stock | (1,032) | — | | Contingent consideration and deferred purchase price payments | (20) | (10) | | Other | (11) | — | | Net cash used in financing activities | (113) | (366) | | Effect of foreign currency exchange rate changes on cash | 90 | (40) | | Increase in cash and cash equivalents | 337 | 169 | | Cash and cash equivalents at beginning of period | 1,702 | 1,376 | | Cash and cash equivalents at end of period | $2,039 | $1,545 | Net Income to Adjusted EBITDA Reconciliation This section presents IQVIA Holdings Inc. and subsidiaries' preliminary unaudited reconciliation of net income to Adjusted EBITDA for the three and six months ended June 30, 2025, detailing adjustments from GAAP net income to non-GAAP Adjusted EBITDA IQVIA HOLDINGS INC. AND SUBSIDIARIES NET INCOME TO ADJUSTED EBITDA RECONCILIATION (preliminary and unaudited) | (in millions) | 2025 (Three Months) | 2024 (Three Months) | 2025 (Six Months) | 2024 (Six Months) | | :--- | :--- | :--- | :--- | :--- | | Net Income | $266 | $363 | $515 | $651 | | Provision for income taxes | 56 | 75 | 117 | 124 | | Depreciation and amortization | 276 | 269 | 541 | 533 | | Interest expense, net | 172 | 151 | 326 | 306 | | Loss (income) in unconsolidated affiliates | 1 | (2) | 14 | 1 | | Stock-based compensation | 60 | 48 | 132 | 104 | | (1) Other expense (income), net | 29 | (66) | 44 | (45) | | Loss on extinguishment of debt | — | — | 4 | — | | (2) Restructuring and related expenses | 42 | 39 | 84 | 61 | | Acquisition related expenses | 8 | 10 | 16 | 14 | | Adjusted EBITDA | $910 | $887 | $1,793 | $1,749 | Net Income to Adjusted Net Income Reconciliation This section provides IQVIA Holdings Inc. and subsidiaries' preliminary unaudited reconciliation of net income to Adjusted Net Income for the three and six months ended June 30, 2025, detailing adjustments from GAAP net income to non-GAAP Adjusted Net Income IQVIA HOLDINGS INC. AND SUBSIDIARIES NET INCOME TO ADJUSTED NET INCOME RECONCILIATION (preliminary and unaudited) | (in millions, except per share data) | 2025 (Three Months) | 2024 (Three Months) | 2025 (Six Months) | 2024 (Six Months) | | :--- | :--- | :--- | :--- | :--- | | Net Income | $266 | $363 | $515 | $651 | | Provision for income taxes | 56 | 75 | 117 | 124 | | (1) Purchase accounting amortization | 131 | 133 | 256 | 262 | | Loss (income) in unconsolidated affiliates | 1 | (2) | 14 | 1 | | Stock-based compensation | 60 | 48 | 132 | 104 | | (2) Other expense (income), net | 29 | (66) | 44 | (45) | | Loss on extinguishment of debt | — | — | 4 | — | | (3) Restructuring and related expenses | 42 | 39 | 84 | 61 | | Acquisition related expenses | 8 | 10 | 16 | 14 | | Adjusted Pre Tax Income | $593 | $600 | $1,182 | $1,172 | | Adjusted tax expense | (107) | (113) | (217) | (217) | | Adjusted Net Income | $486 | $487 | $965 | $955 | | Adjusted earnings per share attributable to common stockholders: | | | | | | Basic | $2.83 | $2.67 | $5.56 | $5.25 | | Diluted | $2.81 | $2.64 | $5.50 | $5.18 | | Weighted average common shares outstanding: | | | | | | Basic | 171.8 | 182.2 | 173.7 | 182.0 | | Diluted | 173.2 | 184.3 | 175.3 | 184.3 | Net Cash Provided by Operating Activities to Free Cash Flow Reconciliation This section presents IQVIA Holdings Inc. and subsidiaries' preliminary unaudited reconciliation of net cash provided by operating activities to free cash flow for the three and six months ended June 30, 2025, detailing adjustments from operating cash flow to free cash flow IQVIA HOLDINGS INC. AND SUBSIDIARIES NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW RECONCILIATION (preliminary and unaudited) | (in millions) | 2025 (Three Months) | 2024 (Three Months) | 2025 (Six Months) | 2024 (Six Months) | | :--- | :--- | :--- | :--- | :--- | | Net Cash provided by Operating Activities | $443 | $588 | $1,011 | $1,110 | | Acquisition of property, equipment and software | (151) | (143) | (293) | (288) | | Free Cash Flow | $292 | $445 | $718 | $822 | Calculation of Gross and Net Leverage Ratios This section provides IQVIA Holdings Inc.'s preliminary unaudited calculation of gross and net leverage ratios as of June 30, 2025, based on gross debt, net debt, and Adjusted EBITDA for the last twelve months IQVIA HOLDINGS INC. AND SUBSIDIARIES CALCULATION OF GROSS AND NET LEVERAGE RATIOS AS OF JUNE 30, 2025 (preliminary and unaudited) | (in millions) | | | :--- | :--- | | Gross Debt, net of Unamortized Discount and Debt Issuance Costs, as of June 30, 2025 | $15,490 | | Net Debt as of June 30, 2025 | $13,451 | | Adjusted EBITDA for the twelve months ended June 30, 2025 | $3,728 | | Gross Leverage Ratio (Gross Debt/LTM Adjusted EBITDA) | 4.16x | | Net Leverage Ratio (Net Debt/LTM Adjusted EBITDA) | 3.61x | Contacts This section provides contact information for IQVIA's Investor Relations department, including the contact person's name, email, and phone number - Investor Relations contact: Kerri Joseph, email: kerri.joseph@iqvia.com, phone: +1.973.541.3558[35]