Financial Data and Key Metrics Changes - Revenue for Q3 2025 increased to $3.6 billion, representing a 9% growth compared to last year [6] - Adjusted EPS grew by 19% to $4.18, with strong pre-free cash flow of $281 million [6][16] - Adjusted operating income was $513 million, or 14.4% of revenue, compared to $441 million, or 13.4% of revenue last year [15][16] Business Segment Data and Key Metrics Changes - Diagnostics revenue increased by 8.5%, primarily due to strong organic growth of 6% [6][17] - Biopharma Laboratory Services (BLS) revenue increased by 8%, with a 5% growth in constant currency [6][19] - Central laboratories experienced a strong growth of 10%, or 7% in constant currency [7][19] Market Data and Key Metrics Changes - The quarterly book-to-bill ratio was 0.9, with a trailing 12-month ratio of 1.09, indicating strong demand [7][19] - The backlog for BLS was $8.6 billion, with an expected conversion of approximately $2.7 billion into revenue over the next 12 months [19] Company Strategy and Development Direction - The company aims to be the partner of choice for health systems and local laboratories, focusing on high-growth therapeutic areas and leveraging technology for operational efficiency [8][10] - Recent acquisitions include clinical laboratory assets from Empire City Laboratories and Laboratory Alliance of Central New York, enhancing the company's market presence [9][10] 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, despite challenges in early development revenue [22] - The company anticipates a $100 million impact from PAMA in 2026, with ongoing efforts to mitigate this through operational efficiencies and AI initiatives [48][68] Other Important Information - The adjusted tax rate for the quarter was 23.3%, with expectations for the full year to be approximately 23% [16] - The company invested $268 million in acquisitions and partnerships during the quarter, with total debt at $5.6 billion [16][17] Q&A Session Summary Question: Inquiry about revenue guidance and currency impact - Management clarified that $13 million of the guidance impact was from foreign exchange, with the rest related to timing of acquisitions [25][26] Question: Organic price per mix growth - Management noted that organic price mix grew by 2.8%, primarily driven by an increase in tests per session and Invitae's performance [32][34] Question: Site consolidation in early development business - Management explained that the decision was based on the timing of study starts and the need to streamline operations, expecting a slight increase in operating income from this action [39][41] Question: Expectations around PAMA - Management indicated ongoing advocacy for legislative changes to mitigate the impact of PAMA, while planning for a $100 million impact on revenue and earnings in 2026 [44][48] Question: Consumer-driven testing contributions - Management highlighted strong growth in the consumer business, with ongoing efforts to expand test offerings and improve patient engagement [52][54] Question: Diagnostic segment margin expansion - Management discussed the factors contributing to margin expansion, including Invitae's integration and operational efficiencies from the Launchpad Initiative [56][58]

Labcorp Holdings (LH) Q1 2025 Earnings Call April 29, 2025 02:09 PM ET Speaker0 Good day, and thank you for standing by. Welcome to the Q1 twenty twenty five LabCorp Holdings Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. To ask a question during the session, you will need to press 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your ques ...