Financial Data and Key Metrics Changes - The company reported total revenue of $322.7 million for 2025, representing a 14% increase year-over-year from $283.5 million in 2024 [18] - Fourth quarter revenue was $83.3 million, a slight decrease from $84.1 million in the third quarter of 2025 [18] - Non-GAAP gross margin for Q4 was 41%, while GAAP gross margin was 39.1% [18] - The GAAP loss for Q4 was $23.4 million, an increase from a loss of $6.6 million in the prior quarter [21] Business Line Data and Key Metrics Changes - Precision diagnostics revenue for Q4 was $48.2 million, an 11% increase year-over-year but down 5% sequentially [12] - Anatomic pathology (AP) revenue for Q4 was $27 million, a 3% increase year-over-year and up 4% sequentially [12] - Biopharma services revenue was $8.1 million for Q4, a 32% increase year-over-year and 10% sequentially [13] - For the full year, precision diagnostics revenue was $190.5 million, a 14% increase over 2024, while AP revenue was $106.4 million, a 10% increase [13] Market Data and Key Metrics Changes - The company anticipates a significant decrease in revenue from its largest customer, which accounted for $70.8 million or 22% of total revenue in 2025, as they transition testing in-house [24] - The anticipated contribution from the acquisition of Bako and StrataDx is expected to be approximately $50 million-$55 million in 2026 [24] Company Strategy and Development Direction - The company is focused on scaling efficiently and driving innovation across its service offerings while managing expenses and integrating strategic acquisitions effectively [26] - Investments in AI and digital pathology are expected to enhance operational efficiency and improve service quality [16] - The company plans to submit a request to the FDA for its first clinical candidate, FID-007, in Q2 2026, with a phase 3 trial initiation planned for the first half of 2027 [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to recover from the loss of its largest customer, citing strong market demand and ongoing investments in technology [41] - The first half of 2026 is expected to be impacted by the transition of the largest customer, but the company anticipates stabilization in the second half [24] - The company expects total revenues to be approximately $350 million for 2026, representing an 8.5% year-over-year growth [24] Other Important Information - The company announced its intention to acquire Bako Diagnostics and StrataDx for a total purchase price of $55.5 million, pending regulatory approvals [13] - The company received approval from New York State for its proprietary NIPT offering and whole genome sequencing test, opening new markets for commercialization [14] Q&A Session Summary Question: Impact of largest customer moving in-house - Management confirmed that the revenue loss from the largest customer is approximately 70% for 2026, with expectations of $11.8 million from this customer [32] Question: Growth strategies for precision diagnostics - Management highlighted several drivers for growth, including expanded carrier screening tests and whole genome sequencing, with strong momentum expected in 2026 [36] Question: Capital allocation strategy post-acquisition - Management indicated a focus on AI capabilities and potential synergies from the Bako acquisition, with plans to invest in both organic growth and strategic acquisitions [42]

AISight® Dx will support fully digital workflows and AI-enabled insights across Labcorp's network of anatomic pathology labs and hospital collaborations to improve efficiency, collaboration and patient care 1 BURLINGTON, N.C., Feb. 23, 2026 /PRNewswire/ -- Labcorp (NYSE: LH), a global leader of innovative and comprehensive laboratory services, today announced an expanded collaboration with PathAI to deploy AISight® Dx, an FDA-cleared digital pathology platform, across its national network of anatomic pathol ...

Core Insights - Labcorp Holdings reported fourth-quarter 2025 adjusted earnings per share (EPS) of $4.07, beating the Zacks Consensus Estimate by 3% and reflecting an 18% increase from the previous year [1][9] - Full-year adjusted EPS was $16.44, representing a year-over-year growth of 12.8% and exceeding the Zacks Consensus Estimate by 0.8% [2] Revenue Performance - Fourth-quarter revenues increased by 5.7% year over year to $3.52 billion, although this figure missed the Zacks Consensus Estimate by 1% [3] - Full-year revenues rose 7.2% year over year to $13.95 billion, also missing the Zacks Consensus Estimate by 0.3% [3] Segment Analysis - Diagnostics Laboratories segment reported revenues of $2.73 billion for the fourth quarter, reflecting a 5.5% improvement year over year [5] - Biopharma Laboratory Services revenues increased by 3.4% to $793 million, driven by organic growth of 0.6% and a foreign currency translation gain of 2.8% [6] Margin Performance - Gross margin expanded by 133 basis points to 28.2% in the fourth quarter, despite a 3.7% rise in the cost of revenues [7] - Adjusted operating income improved by 51% year over year to $454.6 million, with the adjusted operating margin expanding by 389 basis points to 12.9% due to a 9.5% decline in SG&A expenses [7] Cash Position - Labcorp ended the fourth quarter with cash and cash equivalents of $532.3 million, down from $1.52 billion at the end of the fourth quarter of 2024 [10] - Long-term debt remained stable at $5.08 billion, while cumulative net cash provided by operating activities was $1.64 billion, slightly up from $1.59 billion a year ago [10] 2026 Guidance - Labcorp expects 2026 revenues to be in the range of $14.61 billion to $14.79 billion, indicating growth of 4.7% to 6% [12] - Adjusted EPS for 2026 is projected to be between $17.55 and $18.25, with the Zacks Consensus Estimate at $17.62 [12] Strategic Developments - In 2025, Labcorp expanded partnerships with health systems and regional/local laboratories, closing 13 transactions [14] - The company launched over 130 innovative new tests in various fields and announced a strategic investment to build a new 500,000 square foot Central Laboratory facility [14]

Group 1 - Labcorp Holdings reported revenue of $3.52 billion for the quarter ended December 2025, reflecting a 5.6% increase year-over-year [1] - The company's EPS for the quarter was $4.07, up from $3.45 in the same quarter last year, with an EPS surprise of +2.98% compared to the consensus estimate of $3.95 [1] - The reported revenue was slightly below the Zacks Consensus Estimate of $3.55 billion, resulting in a revenue surprise of -0.97% [1] Group 2 - Key metrics indicate that Labcorp's shares have returned +4.3% over the past month, outperforming the Zacks S&P 500 composite, which declined by -1.4% [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3] Group 3 - The net book-to-bill ratio for Labcorp was reported at 1.1%, matching the average estimate based on two analysts [4] - Revenues from Biopharma Laboratory Services were $793 million, slightly above the average estimate of $791.05 million, representing a year-over-year change of +3.4% [4] - Revenues from Diagnostics Laboratories were $2.73 billion, below the average estimate of $2.77 billion, with a year-over-year change of +5.5% [4] - Adjusted Operating Income for Diagnostics Laboratories was $419.2 million, slightly below the average estimate of $423.58 million [4] - Adjusted Operating Income for Biopharma Laboratory Services was $136.1 million, exceeding the average estimate of $130.1 million [4] - Unallocated corporate expenses were reported at -$67.6 million, better than the average estimate of -$69.13 million [4]

Financial Data and Key Metrics Changes - In 2025, Labcorp achieved over 7% top-line growth and 13% adjusted EPS growth, with margins improving by over 50 basis points [4][12] - For Q4 2025, enterprise revenue increased by 5.6% to $3.5 billion, with adjusted EPS growing 18% to $4.07 [13][9] - Free cash flow for the year was $1.2 billion, a 10% increase, while Q4 free cash flow was $490 million, down from $665 million due to working capital timing [12][14] Business Line Data and Key Metrics Changes - Diagnostics revenue for Q4 was $2.7 billion, up 5.5% year-over-year, with organic growth of 4.1% and acquisitions contributing 1.5% [15] - Biopharma Laboratory Services (BLS) revenue increased by 3.4% to $793 million, with central lab revenue growing 11.1% [16] - Adjusted operating income for diagnostics was $419 million (15.4% of revenue), while BLS adjusted operating income was $136 million (17.2% of revenue) [15][17] Market Data and Key Metrics Changes - The central laboratory business saw strong demand, particularly in oncology and neurology, with a trailing twelve-month book-to-bill ratio of 1.09 [9][17] - Esoteric testing accounted for 41.5% of total testing revenue in Q4, reflecting a growing trend in specialty testing [93] Company Strategy and Development Direction - Labcorp is focusing on deepening partnerships with health systems and local laboratories, having signed 13 deals that contributed over $1 billion in revenue [4][5] - The company is advancing its leadership in specialty testing, launching over 130 new tests in 2025, particularly in oncology, women's health, and neurology [6][7] - A new central laboratory facility is planned to support growth, with construction expected to begin later this year [8][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in strong underlying business performance for 2026, expecting enterprise revenue growth of 5.4% and adjusted EPS growth of approximately 9% [10][19] - The delay of PAMA until December 31, 2026, is seen as a positive development, but management continues to advocate for the passage of the RESULTS Act [10][54] - Management noted that the utilization environment remains healthy, driven by an aging population and increased testing [44] Other Important Information - The company plans to invest approximately 4% of revenue in capital expenditures in 2026, higher than previous years, to support long-term growth [56][20] - Two executives, Mark Schroeder and Sandy van der Vaart, will retire on April 1, with successors already appointed [10][11] Q&A Session Summary Question: How are you thinking about contributions from price and volume in 2026 guidance? - Management expects revenue growth of 5%-6% in diagnostics, with half of the organic growth coming from volume and half from price mix [25][26] Question: What are the contributions from Invitae this year? - The integration of Invitae has gone well, and it is expected to grow revenue at two to three times the overall market rate, but will not be broken out separately [29][30] Question: What impacted the fourth quarter organic volume? - Lower referrals from a large consumer genetic client and weather conditions affected organic volume, but adjustments indicate growth would have been over 2% [33][34] Question: Where do you see the biggest risks in 2026 guidance? - Risks include slightly higher or lower organic volumes and the timing of M&A impacting revenue [42][44] Question: How do you view the competitive landscape in the diagnostic business? - Management believes the diagnostic market is strong, with Labcorp expected to outperform overall market growth, particularly in specialty testing [46][47] Question: What is the status of PAMA and its impact? - The delay of PAMA is seen positively, and management will continue to advocate for the RESULTS Act while preparing to submit necessary data [53][54] Question: Can you discuss the early development business and market growth? - The early development business is expected to be relatively flat in 2026, with improvements anticipated as consolidation efforts progress [64][66]

Fourth Quarter 2025 Supplemental Financial Information February 17, 2026 labcorp Cautionary Statement Regarding Forward-Looking Statements This presentation contains forward-looking statements, including, but not limited to, statements with respect to (i) the estimated 2026 auidance and related assumations. (li) the impact of various factors on operating and financial results. including alobal economic and market conditions on the company's businesses, operating results, cash flows and/or financial conditio ...

Core Insights - Labcorp reported strong financial performance for Q4 2025 and the full year, with revenue growth of over 7% and double-digit adjusted EPS growth, driven by its Diagnostics and Central Laboratory businesses [1][2] - The company provided guidance for 2026, projecting revenue between $14.61 billion and $14.79 billion, adjusted EPS between $17.55 and $18.25, and free cash flow of $1.24 billion to $1.36 billion [1][2] Financial Performance - Q4 2025 revenue was $3.52 billion, a 5.6% increase from Q4 2024's $3.33 billion; full-year revenue reached $13.95 billion, up 7.2% from $13.01 billion [1][2] - Adjusted EPS for Q4 was $4.07, compared to $3.45 in Q4 2024; full-year adjusted EPS was $16.44, up from $14.57 [1][2] - Free cash flow for Q4 was $490.3 million, down from $665.1 million in Q4 2024; full-year free cash flow increased to $1.21 billion from $1.10 billion [1][2] Strategic Developments - Labcorp completed several acquisitions, including assets from Empire City Laboratories, Incyte Diagnostics, and Community Health Systems, enhancing its service offerings [1][2] - The company announced plans to build a new 500,000 square foot Central Laboratory facility in Indiana, expected to begin construction in late 2026 [1][2] - Labcorp launched new consumer-initiated tests and expanded access to molecular residual disease testing for various cancers, as well as the first FDA-cleared blood test for Alzheimer's disease [1][2] Capital Allocation - In 2025, Labcorp invested $582 million in acquisitions, paid $240.7 million in dividends, and repurchased $450 million of its stock [1][2] - The company reported a cash and cash equivalents balance of $532.3 million and total debt of $5.58 billion at the end of Q4 2025 [1][2] Segment Performance - The Diagnostics Laboratories segment generated $2.73 billion in revenue for Q4 2025, a 5.5% increase from Q4 2024; adjusted operating income was $419.2 million, with a margin of 15.4% [2][4] - The Biopharma Laboratory Services segment reported $793 million in revenue for Q4 2025, a 3.4% increase, with adjusted operating income of $136.1 million and a margin of 17.2% [2][4]

Financial Data and Key Metrics Changes - In Q4 2025, consolidated revenues reached $2.81 billion, reflecting a 7.1% increase year-over-year. Organic revenues grew by 6.4% [15] - Reported operating income was $386 million, maintaining a margin of 13.8%, while adjusted operating income was $429 million, or 15.3% of revenues, compared to 15.6% the previous year [16] - Reported EPS was $2.18, and adjusted EPS was $2.42, up from $1.95 and $2.23 respectively in the prior year [16] Business Line Data and Key Metrics Changes - Diagnostic information services revenues increased by 7.3%, driven by organic growth across physician, hospital, and consumer channels [15] - In the physician channel, organic revenue growth was high single digits, while hospital channel revenues grew low single digits [9] - The consumer channel generated nearly $250 million in revenues for the full year, with growth exceeding 20% [11] Market Data and Key Metrics Changes - Total volume measured by requisitions increased by 8.5%, with organic volume up 7.9% [15] - Excluding significant volume growth from Corewell Health and Fresenius Medical Care, organic volume growth was 4.1% [15] - The company expects to generate approximately $1 billion in annual revenues from co-lab solutions in 2026 [10] Company Strategy and Development Direction - The company aims to expand its clinical innovations and strategic collaborations to enhance its position in the wellness industry [5] - Focus areas include advanced diagnostics in cardiometabolic, autoimmune, brain health, oncology, and women's health [12] - The company is pursuing acquisitions and partnerships to enhance its service offerings and market reach [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in business strengths and market fundamentals, citing favorable demographic trends and increasing demand for blood-based diagnostics [5] - The delay in PAMA implementation until the end of 2026 was viewed as a positive development, providing short-term relief [6] - The company anticipates continued organic growth driven by innovations and strategic partnerships [21] Other Important Information - The company achieved a significant increase in cash from operations, totaling $1.89 billion for the full year, compared to $1.33 billion in the prior year [17] - Capital expenditures for 2026 are expected to be approximately $550 million [17] Q&A Session Summary Question: What are the underlying growth drivers for 2026? - Management highlighted strong organic growth in Alzheimer's testing, autoimmune testing, and partnerships with wellness companies as key drivers [24][26] Question: How is the company addressing the impact of severe weather on Q1? - Management noted strong growth in early January but acknowledged the impact of severe storms, expressing confidence in recovery throughout the quarter [27][29] Question: Can you discuss the moving pieces on margins for 2026? - Management indicated that operating margins are expected to increase, despite the impact of lower-margin co-lab business from Corewell [37][39] Question: What is the competitive landscape like for the company? - Management emphasized share gains in organic growth and the strength of their national coverage as competitive advantages [45][46] Question: How is the company planning to monetize its data? - Management discussed the growth of the data business, highlighting its value to pharmaceutical companies and payers [90]

Financial Data and Key Metrics Changes - In Q4 2025, consolidated revenues reached $2.81 billion, reflecting a 7.1% increase year-over-year, with organic revenues growing by 6.4% [15][16] - Reported operating income was $386 million, maintaining a margin of 13.8%, while adjusted operating income was $429 million, or 15.3% of revenues, compared to 15.6% the previous year [16] - Reported EPS was $2.18, and adjusted EPS was $2.42, up from $1.95 and $2.23 respectively in the prior year [16] Business Line Data and Key Metrics Changes - In the physician channel, organic revenue growth was high single digits, driven by demand for advanced diagnostics and geographic expansion [9] - Hospital channel revenues grew low single digits, with collaborative lab solutions contributing to growth [9] - The consumer channel generated nearly $250 million in revenues for the full year, exceeding the expected growth rate of over 20% [11] Market Data and Key Metrics Changes - Total volume measured by requisitions increased by 8.5% year-over-year, with organic volume up 7.9% [15] - Excluding significant relationships with Corewell Health and Fresenius Medical Care, organic volume growth was 4.1% [15] - The company expects to generate approximately $1 billion in annual revenues from co-lab solutions in 2026 [10] Company Strategy and Development Direction - The company aims to expand its clinical innovations and strategic collaborations to enhance its position in the wellness industry [5] - Focus on delivering solutions for core clinical customers while also targeting growth in consumer, life sciences, and data analytics [8] - The company is pursuing potential acquisitions and partnerships to enhance its service offerings and market reach [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in business strengths and market fundamentals, citing favorable demographic trends and increasing demand for blood-based diagnostics [5] - The delay in PAMA implementation until the end of 2026 was viewed as a positive development, providing short-term relief [6][7] - Management anticipates continued strong organic growth driven by advancements in testing and strategic partnerships [24] Other Important Information - The company achieved its target of 3% annual cost savings and productivity improvements in 2025 through operational excellence initiatives [14] - Cash from operations for the full year was $1.89 billion, significantly up from $1.33 billion in the prior year [17] - The company expects capital expenditures of approximately $550 million in 2026 [18] Q&A Session Summary Question: What are the underlying growth drivers for 2026? - Management highlighted strong organic growth in Alzheimer's testing, autoimmune testing, and partnerships with wellness companies as key drivers [24][26] Question: How is the company addressing the impact of severe weather on operations? - Management noted strong growth in early January but acknowledged that severe weather affected operations later in the month, with confidence in recovery [27][29] Question: Can you discuss the moving pieces on margins for 2026? - Management indicated that operating margins are expected to increase, despite the impact of low-margin co-lab business and Project Nova expenses [37][39] Question: What is the competitive landscape like for the company? - Management emphasized share gains in organic growth and the strength of national coverage as competitive advantages [45][46] Question: How is the company planning to monetize its data? - Management discussed the growth of the data business, targeting pharmaceutical companies and payers as key customers [90]

Financial Data and Key Metrics Changes - In Q4 2025, consolidated revenues reached $2.81 billion, reflecting a 7.1% increase year-over-year. Consolidated organic revenues grew by 6.4% [14] - Reported operating income was $386 million, maintaining a margin of 13.8%, while adjusted operating income was $429 million, or 15.3% of revenues, compared to 15.6% the previous year [15] - Reported EPS was $2.18, and adjusted EPS was $2.42, compared to $1.95 and $2.23 in the prior year, respectively [15] Business Line Data and Key Metrics Changes - In the physician channel, organic revenue growth was high single digits in Q4, driven by demand for advanced diagnostics and geographic expansion [7] - Hospital channel revenues grew low single digits, with collaborative lab solutions contributing to growth [8] - The consumer channel generated nearly $250 million in revenues for the full year, with consumer-initiated testing exceeding 20% growth [10] Market Data and Key Metrics Changes - Total volume measured by requisitions increased by 8.5% year-over-year, with organic volume up 7.9% [14] - Excluding significant volume growth from Corewell Health and Fresenius Medical Care, organic volume growth was 4.1% in Q4 [14][51] Company Strategy and Development Direction - The company aims to enhance its position as a premier lab engine in the wellness industry, focusing on clinical innovations and strategic collaborations [4] - The delay in PAMA implementation until the end of 2026 is seen as a short-term relief, but the company advocates for structural reforms to prevent excessive rate cuts [5][6] - The company is pursuing acquisitions and partnerships to expand its co-lab solutions and consumer testing capabilities [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in business strengths and market fundamentals, including favorable demographic trends and increasing interest in preventative health [4] - The company anticipates a revenue growth rate of 6%-7.1% for 2026, with adjusted EPS expected to be in the range of $10.50-$10.70 [16][17] - Management acknowledged challenges from severe weather impacting early 2026 but remains optimistic about recovery [25][28] Other Important Information - The company achieved its target of 3% annual cost savings and productivity improvements in 2025 through operational excellence initiatives [13] - The consumer testing segment is expected to continue growing, supported by partnerships with wellness companies and a strong focus on preventative health [60][66] Q&A Session Summary Question: What are the underlying growth drivers for 2026? - Management highlighted strong organic growth in Alzheimer's testing, autoimmune testing, and partnerships with wellness companies as key drivers [23][24] Question: How is the company addressing the impact of severe weather on growth? - Management noted that while January faced challenges, they expect recovery in the remaining quarters and have systems in place to track and reschedule missed appointments [25][28] Question: Can you discuss the moving pieces on margins for 2026? - Management indicated that operating margins are expected to increase, despite the impact of low-margin co-lab business from Corewell and Project Nova expenses [35][39] Question: What is the competitive environment like for the company? - Management emphasized that the company is gaining market share, particularly in key states, and highlighted its national coverage as a competitive strength [44][46] Question: How is the company planning to monetize its data? - Management discussed the growth of its data business, which serves pharmaceutical companies, payers, and public health agencies, and mentioned partnerships with AI companies to enhance data utilization [84][86]