Agilent Technologies(A) ZACKS·2024-11-26 20:06Core Insights - Agilent Technologies reported fourth-quarter fiscal 2024 earnings of $1.46 per share, exceeding the Zacks Consensus Estimate by 3.6%, and reflecting a year-over-year increase of 5.8% [1] - Revenues reached $1.70 billion, surpassing the Zacks Consensus Estimate by 1.67%, with a reported increase of 0.8% and a core basis decline of 0.3% compared to the previous year [1] Revenue Growth Drivers - Growth was primarily driven by advancements in the Pharmaceutical, Diagnostics, and Clinical sectors, along with improvements in the Chemical and Advanced Materials markets [2] - Challenges were noted in the Food, Academic and Government, and Environmental and Forensics markets during the reported quarter [2] Regional Performance - Modest weakening conditions in the Americas and China were significant headwinds, while growing momentum across Europe and the Asia Pacific provided a tailwind [3] Segment Performance - Life Sciences & Applied Markets Group (LSAG): Generated $833 million, accounting for 49% of total revenues, with a 1% decline year-over-year on both reported and core basis due to softness in the instrument business, offset by strong demand for analytical lab consumables [5] - Agilent Cross Lab Group (ACG): Revenues of $426 million, representing 25% of total revenues, grew 5% on both reported and core basis, driven by strong growth in contract business and Enterprise Services segment [6] - Diagnostics and Genomics Group (DGG): Revenues decreased 1% year-over-year on a reported basis and 3% on a core basis to $442 million, accounting for 26% of total revenues, with expected softness in Cell Analysis and NASD, partially offset by growth in Cancer Dx and Genomics [7] Organizational Changes - The company unveiled a new organizational structure aimed at accelerating operational transformation and driving higher growth through a market-focused, customer-centric strategy [8] Operating Results - Gross margin in the LSAG segment contracted 40 basis points to 59.1%, while ACG's gross margin expanded 50 basis points to 50.9%, and DGG's gross margin contracted 220 basis points to 51.5% [9] - Non-GAAP operating margin for the fourth quarter was 27.4%, indicating a year-over-year contraction of 40 basis points [11] Expenses Overview - R&D expenses on a non-GAAP basis were $109 million, down 6% year-over-year, while SG&A expenses rose slightly to $362 million, marking a 1.4% increase [10] Balance Sheet & Cash Flow - As of October 31, 2024, cash and cash equivalents were $1.33 billion, down from $1.78 billion as of July 31, 2024, with accounts receivables at $1.32 billion [13] - Long-term debt increased to $3.35 billion from $2.14 billion in the prior quarter, with cash flow from operating activities at $481 million [14] Future Guidance - For Q1 fiscal 2025, management expects revenues of $1.650-$1.680 billion, indicating a decline of 0.5% year-over-year, with non-GAAP earnings per share expected to be $1.25-$1.28 [15] - For fiscal 2025, revenue guidance was revised to $6.79-$6.87 billion, implying a reported increase of 4.3-5.5% and a core increase of 2.5-3.5% from fiscal 2024 [16]