DGX Q2 Earnings Preview: Will Advanced Diagnostics Lead Performance?

Core Insights - Quest Diagnostics (DGX) is expected to release its Q2 2025 results on July 22, with adjusted EPS of $2.21 in the last quarter, exceeding estimates by 2.79% [1] - The Zacks Consensus Estimate for Q2 2025 revenues is $2.72 billion, reflecting a 13.4% increase year-over-year, while EPS is projected to rise by 9.4% to $2.57 [2] Revenue and Earnings Estimates - Q2 2025 revenue estimates for Quest Diagnostics have increased by 1 cent to $2.57 in the past week [3] - The anticipated revenue growth is driven by the Advanced Diagnostics portfolio and strong performance across key clinical areas [4] Growth Drivers - The core Diagnostics Information Services (DIS) business is expected to see growth from prenatal and hereditary genetic testing, as well as the new HPV self-collection solution [5] - The AD-Detect suite for Alzheimer's risk assessment is likely to contribute to growth through personalized testing approaches [5] - The introduction of the Haystack minimal residual disease (MRD) blood test and large enterprise accounts are expected to further boost Advanced Diagnostics growth [6] Market Access and Partnerships - Revenue growth in Q2 2025 is supported by expanded health plan access with Elevance Health and Sentara Health Plans, effective January 1 [7] - Quest Diagnostics is now part of the Optum Health preferred lab network, enhancing service delivery to over 85,000 physicians [7] Operational Efficiency - The Collaborative Lab Solutions business is anticipated to lead revenue growth in the hospital channel [8] - The company is focusing on productivity gains from recent acquisitions and leveraging automation, robotics, and AI to improve operational efficiency [11] Financial Projections - Quest Diagnostics is projected to achieve 13.4% revenue growth and 9.4% EPS growth in Q2 2025, driven by Advanced Diagnostics and expanded payer access [9] - The DIS revenues are expected to increase by 13.5% year-over-year, with acquisitions contributing 5.8% [10] - Operating income is projected to rise by 13.6% year-over-year in Q2 2025 [11] Earnings Expectations - Quest Diagnostics has an Earnings ESP of +0.67% and a Zacks Rank of 3, indicating a higher chance of beating estimates [12]