Latest news with #AdamSchechter
Yahoo
30-07-2025
- Business
- Yahoo
Quest, Labcorp downplay ‘Big Beautiful Bill' impact
This story was originally published on MedTech Dive. To receive daily news and insights, subscribe to our free daily MedTech Dive newsletter. Historic Medicaid cuts in Republicans' 'One Big Beautiful Bill,' signed into law earlier this month, are unlikely to have a negative impact on laboratory testing volumes in the near term, executives at Labcorp and Quest Diagnostics reassured investors on earnings calls last week. Labcorp CEO Adam Schechter, answering an analyst's question on potential fallout from the legislation, described the impact as manageable. While lab testing is an essential tool used in almost every healthcare decision, it accounts for a 'very small fraction' of U.S. healthcare spending, the CEO said. The new tax and domestic policy law overhauls Medicaid and the Affordable Care Act to align with Republican priorities, including funding cuts, Medicaid work requirements and stricter eligibility verification for the safety net insurance program and the healthcare exchange. The legislation decreases federal healthcare spending by $1.1 trillion over the next decade and is expected to cause 10 million Americans to lose health insurance. Schechter said he doesn't foresee an impact on Medicaid until 2028, 'and the key is going to be, do people find insurance through other ways, through states or spouses that might have insurance?' If a large group of people become uninsured, Schechter said he would be concerned, but he doesn't expect that to happen. 'I don't think it's very likely in the United States that you'll have a very big group of people automatically become uninsured in a specific period of time,' he said. On the healthcare exchange, the expiration of tax credits could have a negative impact for Labcorp of as high as 30 basis points, Schechter said. The legislation will be harder on Labcorp's hospital customers, he said, which could accelerate deals for outreach businesses and running hospital laboratories. Quest Diagnostics CEO Jim Davis said the cuts to Medicaid would have no impact next year and 'very little' impact in 2027 because states will have time to react to the changes. In addition, no more than 4% to 5% of Quest's revenue comes from the healthcare exchange. CFO Sam Samad said the company expects an impact of about 30 basis points on Quest's testing volumes in 2026 if exchange subsidies are not renewed at the end of this year. Davis said people who buy their insurance on the exchange may be able to pay higher premiums to keep their coverage or could switch to their employers' health insurance. Both Quest and Labcorp raised their revenue forecasts for 2025. William Blair analyst Andrew Brackmann, in a note to clients Friday, said Labcorp investors are likely to remain focused on potential impacts from Washington. However, 'looking to the second half of the year and into 2026, expectations appear appropriately set.' Recommended Reading Labcorp to buy some Community Health assets for $195M Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
24-07-2025
- Business
- Yahoo
Labcorp (NYSE:LH) Posts Better-Than-Expected Sales In Q2
Healthcare diagnostics company Labcorp Holdings (NYSE:LH) announced better-than-expected revenue in Q2 CY2025, with sales up 9.5% year on year to $3.53 billion. Its non-GAAP profit of $4.35 per share was 4.5% above analysts' consensus estimates. Is now the time to buy Labcorp? Find out in our full research report. Labcorp (LH) Q2 CY2025 Highlights: Revenue: $3.53 billion vs analyst estimates of $3.49 billion (9.5% year-on-year growth, 1% beat) Adjusted EPS: $4.35 vs analyst estimates of $4.16 (4.5% beat) Adjusted EBITDA: $598.9 million vs analyst estimates of $611 million (17% margin, 2% miss) Management raised its full-year Adjusted EPS guidance to $16.28 at the midpoint, a 1.4% increase Operating Margin: 11.2%, up from 9.2% in the same quarter last year Free Cash Flow Margin: 15.4%, up from 13.4% in the same quarter last year Organic Revenue rose 5.4% year on year (3.8% in the same quarter last year) Market Capitalization: $20.97 billion "Labcorp had a very strong second quarter, delivering double-digit topline growth, while expanding margins across both segments," said Adam Schechter, chairman and CEO of Labcorp. Company Overview With over 600 million tests performed annually and involvement in 90% of FDA-approved drugs in 2023, Labcorp (NYSE:LH) provides laboratory testing services and drug development solutions to doctors, hospitals, pharmaceutical companies, and patients worldwide. Revenue Growth Reviewing a company's long-term sales performance reveals insights into its quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Unfortunately, Labcorp's 3.3% annualized revenue growth over the last five years was tepid. This was below our standard for the healthcare sector and is a poor baseline for our analysis. We at StockStory place the most emphasis on long-term growth, but within healthcare, a half-decade historical view may miss recent innovations or disruptive industry trends. Labcorp's annualized revenue growth of 6.6% over the last two years is above its five-year trend, but we were still disappointed by the results. Labcorp also reports organic revenue, which strips out one-time events like acquisitions and currency fluctuations that don't accurately reflect its fundamentals. Over the last two years, Labcorp's organic revenue averaged 3.5% year-on-year growth. Because this number is lower than its normal revenue growth, we can see that some mixture of acquisitions and foreign exchange rates boosted its headline results. This quarter, Labcorp reported year-on-year revenue growth of 9.5%, and its $3.53 billion of revenue exceeded Wall Street's estimates by 1%. Looking ahead, sell-side analysts expect revenue to grow 5.7% over the next 12 months, similar to its two-year rate. This projection is above average for the sector and indicates its newer products and services will help sustain its recent top-line performance. Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we've identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link. Operating Margin Labcorp has done a decent job managing its cost base over the last five years. The company has produced an average operating margin of 14.1%, higher than the broader healthcare sector. Analyzing the trend in its profitability, Labcorp's operating margin decreased by 16.2 percentage points over the last five years. This raises questions about the company's expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. This quarter, Labcorp generated an operating margin profit margin of 11.2%, up 2 percentage points year on year. This increase was a welcome development and shows it was more efficient. Earnings Per Share Revenue trends explain a company's historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions. Labcorp's EPS grew at a solid 7.2% compounded annual growth rate over the last five years, higher than its 3.3% annualized revenue growth. However, this alone doesn't tell us much about its business quality because its operating margin didn't improve. We can take a deeper look into Labcorp's earnings quality to better understand the drivers of its performance. A five-year view shows that Labcorp has repurchased its stock, shrinking its share count by 14.1%. This tells us its EPS outperformed its revenue not because of increased operational efficiency but financial engineering, as buybacks boost per share earnings. In Q2, Labcorp reported EPS at $4.35, up from $3.94 in the same quarter last year. This print beat analysts' estimates by 4.5%. Over the next 12 months, Wall Street expects Labcorp's full-year EPS of $15.14 to grow 10.9%. Key Takeaways from Labcorp's Q2 Results It was good to see Labcorp narrowly top analysts' full-year EPS guidance expectations this quarter. We were also happy its revenue narrowly outperformed Wall Street's estimates. On the other hand, its organic revenue slightly missed. Overall, this print had some key positives. The stock traded up 2.6% to $257.09 immediately following the results. Is Labcorp an attractive investment opportunity right now? When making that decision, it's important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it's free. 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Yahoo
24-07-2025
- Business
- Yahoo
Labcorp Announces 2025 Second Quarter Results
Raises Full-Year Guidance Financial results from Operations for second quarter 2025 versus second quarter 2024: Revenue: $3.53 billion versus $3.22 billion Diluted EPS: $2.84 versus $2.43 Adjusted EPS: $4.35 versus $3.94 Raised Enterprise Revenue, Adjusted EPS and Free Cash Flow guidance: Revenue guidance narrowed to 7.5% to 8.6%; midpoint raised by 70 basis points Adjusted EPS range narrowed to $16.05 to $16.50; midpoint raised by $0.23 Free Cash Flow range of $1.13 billion to $1.28 billion; midpoint raised by $25 million Broadened our partnerships with hospitals, health systems and regional/local labs and enhanced access to comprehensive testing and laboratory services Introduced several new tests in high-growth specialty areas including oncology BURLINGTON, N.C., July 24, 2025 /PRNewswire/ -- Labcorp (NYSE: LH), a global leader of innovative and comprehensive laboratory services, today announced results for the second quarter ended June 30, 2025 and raised full-year guidance. "Labcorp had a very strong second quarter, delivering double-digit topline growth, while expanding margins across both segments," said Adam Schechter, chairman and CEO of Labcorp. "We brought innovative tests to market, and applied our leadership in science and technology to drive growth, enhance the customer experience and improve our operations. We remain committed to delivering sustained value to our customers, employees and shareholders as we execute on our long-term strategy. Based upon our performance in the first half and our momentum going into the second half of the year, we're raising our guidance." In the second quarter, Labcorp advanced its position as a partner of choice for hospitals, health systems and regional/local laboratories: Announced an agreement to acquire select assets of Incyte Diagnostics' clinical and anatomic pathology testing businesses in the Pacific Northwest. Continued to progress the acquisition of select oncology and clinical testing assets from BioReference Health. Subsequent to quarter end, Labcorp announced an agreement to acquire select assets of the outreach business from Community Health Systems across 13 states. Labcorp also continued to incorporate the power of science, innovation and technology across the organization during or subsequent to the quarter: Expanded its oncology portfolio with key launches including Labcorp® Plasma Detect™, a liquid biopsy test that assesses colon cancer recurrence risk and PGDx elio® plasma focus™ Dx, the first-and-only FDA-authorized pan-solid tumor liquid biopsy test for targeted treatment guidance. Continued to advance its leading position in Alzheimer's disease, and plans in the coming weeks to offer Fujirebio FDA-cleared biomarker test that aids in diagnosing the disease. Expanded its consumer offerings by launching several consumer-initiated tests through Labcorp OnDemand, including tests that measure an individual's cortisol and leptin levels, and introducing a new and improved Ovia app, providing women with a single platform to support their health journey. Introduced Labcorp Whole Health Solutions for functional medicine, integrative medicine and primary care practices. The solution offers specialized test panels and a test menu of more than 1,000 scientifically backed biomarkers. Added digital pathology capabilities in Central Labs, including advanced image scanning to preserve critical sample data and AI-powered solutions to provide analysis on large datasets instantly. On July 10, 2025, the company announced a quarterly cash dividend of $0.72 per share of common stock, payable on September 11, 2025, to stockholders of record at the close of business on August 28, 2025. In the quarter, Labcorp repurchased $200 million of common stock. Additionally, Labcorp raised 2025 guidance for enterprise revenue, adjusted EPS and free cash flow primarily driven by currency, as well as the underlying strength of its businesses. LABCORP HOLDINGS INC. AND SUBSIDIARIES CONSOLIDATED RESULTS Three Months Ended June 30,Six Months Ended June 30,20252024Delta20252024Delta Revenue Summary (Dollars in billions) Total Revenue $ 3.53$ 3.229.5 %$ 6.87$ 6.407.4 % Organic(1) 5.4 %3.7 % Acquisitions, net of Divestitures 3.5 %3.6 % Foreign Exchange 0.6 %0.1 % (1) Organic revenue is no longer broken out between the Base Business and COVID-19 Summary (Dollars in millions, except per share data) Operating Income ("OI") $ 394.5$ 294.8$ 720.5$ 616.1 OI as % of Revenue 11.2 %9.2 %200 bps10.5 %9.6 %90 bps Adjustments (2) $ 137.1$ 185.1$ 280.1$ 316.6 Adjusted Operating Income ("AOI") (3) $ 531.6 (4) $ 479.9$ 1,000.6$ 932.7 AOI as % of Revenue 15.1 % (5) 14.9 %20 bps14.6 %14.6 %— bps Net Earnings Attributable to Labcorp Holdings Inc. $ 237.9$ 205.3$ 450.7$ 433.3 Diluted EPS $ 2.84$ 2.43$ 5.36$ 5.13 Adjusted EPS (3) $ 4.35$ 3.9410.4 %$ 8.19$ 7.627.5 % (2) Adjustments include amortization, impairment charges, restructuring charges, and special items. (3) Non-GAAP financial measure. See "Reconciliation of Non-GAAP Measures" for additional information. (4) The increase in adjusted operating income was due to organic demand as the company leveraged well on revenue growth. (5) Adjusted operating margin was constrained by Invitae. LABCORP HOLDINGS INC. AND SUBSIDIARIES CONSOLIDATED RESULTSThree Months Ended June 30,Six Months Ended June 30,2025202420252024 Cash Flow Summary (Dollars in millions)Operating Cash Flow $ 620.6$ 561.1$ 639.1$ 531.3 Capital Expenditures 77.9128.2203.9262.0 Free Cash Flow $ 542.7 (1) $ 432.9$ 435.2$ 269.3 (1) The increase in free cash flow was driven by higher earnings and the timing of capital expenditures. Capital Allocation Summary At the end of the quarter, Labcorp's cash and cash equivalents balance was $0.65 billion and total debt was $5.58 billion. During the quarter, the company invested $25.0 million in acquisitions and partnerships, paid out $59.9 million in dividends, and repurchased $200.0 million of stock. LABCORP HOLDINGS INC. AND SUBSIDIARIES Diagnostics Laboratories Segment Summary Three Months Ended June 30,20252024Delta Revenue Summary (Dollars in billions) Total Revenue $ 2.75$ 2.528.9 % Organic(1) 4.5 % Acquisitions, net of Divestitures 4.5 % Foreign Exchange (0.1 %) (1) Organic revenue is no longer broken out between the Base Business and COVID-19 Testing. Earnings Summary (2) (Dollars in millions) Adjusted Operating Income ("AOI") (3) $ 482.8$ 441.5 AOI as % of Revenue 17.6 % (4) 17.5 %10 bps (2) Non-GAAP financial measure. See "Reconciliation of Non-GAAP Measures" for additional information. (3) Excludes amortization, restructuring charges, special items, and unallocated corporate expenses. (4) Adjusted operating margin was constrained by Invitae. Three Months Ended June 30, 2025 RequisitionPrice/Mix Volume Delta (5)Delta (5) Metrics Summary Total4.9 %4.0 % Organic (6)3.4 %1.1 % Acquisitions, net of Divestitures1.5 %3.0 % Foreign Exchange— %(0.1) %(5) Column shows changes versus the three months ended June 30, 2024. (6) Organic price/mix includes lab management agreements. LABCORP HOLDINGS INC. AND SUBSIDIARIES Biopharma Laboratory Services Segment Summary Three Months Ended June 30,20252024DeltaRevenue Summary (Dollars in millions)Total Revenue$ 784.8$ 707.011.0 % (1) Organic7.8 %Foreign Exchange3.2 %(1) Early Development revenue growth of 20.4%, Central Labs revenue growth of 7.5%. Earnings Summary (2) (Dollars in millions)Adjusted Operating Income ("AOI") (3)$ 123.3 (4) $ 107.4AOI as % of Revenue15.7 %15.2 %50 bps (4) (2) Non-GAAP financial measure. See "Reconciliation of Non-GAAP Measures" for additional information. (3) Excludes amortization, restructuring charges, special items, and unallocated corporate expenses. (4) Adjusted operating income and margin increase was primarily driven by organic demand and operating efficiencies. As of June 30, 2025Metrics Summary (Dollars in billions) TTM Net Orders $ 3.34TTM Book to Bill 1.11Backlog $ 8.71 (5) Next Twelve Months Forecast Backlog Conversion $ 2.71 (5) Backlog increased 10.0% compared to this period last year. Guidance for 2025 Labcorp is updating 2025 full year guidance to reflect its second quarter performance and full year outlook. The following guidance assumes foreign exchange rates effective as of June 30, 2025, for the remainder of the year. Enterprise level guidance includes the estimated impact from currently anticipated capital allocation, including acquisitions, share repurchases and dividends. (Dollars in billions, except per share data) PreviousUpdatedResults2025 Guidance2025 Guidance2024Low HighLow High RevenueLabcorp Enterprise (1)(2) $13.016.7 % 8.0 %7.5 % 8.6 % Diagnostics Laboratories(3) $10.146.5 % 7.7 %7.0 % 8.0 % Biopharma Laboratory Services (4) $2.923.0 % 5.0 %6.1 % 7.5 % Adjusted EPS $14.57$15.70 $16.40$16.05 $16.50 Free Cash Flow $1.10$1.10 $1.25$1.13 $1.28 (1) 2025 Guidance includes an impact from foreign currency translation of 0.5%. (2) Enterprise level revenue is presented net of intersegment transaction eliminations. (3) 2025 Guidance includes an impact from foreign currency translation of (0.1%). (4) 2025 Guidance includes an impact from foreign currency translation of 2.5%.Use of Adjusted Measures The company has provided in this press release and accompanying tables "adjusted" financial information that has not been prepared in accordance with GAAP, including adjusted net income, adjusted EPS (or adjusted net income per share), adjusted operating income, adjusted operating margin, free cash flow, and certain segment information. The company believes these adjusted measures are useful to investors as a supplement to, but not as a substitute for, GAAP measures, in evaluating the company's operational performance. The company further believes that the use of these non-GAAP financial measures provides an additional tool for investors in evaluating operating results and trends, and growth and shareholder returns, as well as in comparing the company's financial results with the financial results of other companies. However, the company notes that these adjusted measures may be different from and not directly comparable to the measures presented by other companies. Reconciliations of these non-GAAP measures to the most comparable GAAP measures and an identification of the components that comprise "special items" used for certain adjusted financial information are included in the tables accompanying this press release. The company today is providing an investor relations presentation with additional information on its business and operations, which is available in the investor relations section of the company's website at Analysts and investors are directed to the website to review this supplemental information. A conference call discussing Labcorp's quarterly results will be held today at 9:00 a.m. ET and is available by registering at this link, which will provide a dial-in number and unique PIN to access the call. It is recommended that participants join 10 minutes prior to the start of the call, although participants may register and join at any time during the call. A live webcast of Labcorp's quarterly conference call on July 24, 2025, will be available at the Labcorp Investor Relations website beginning at 9:00 a.m. ET. This webcast will be archived and accessible through July 11, 2026. About Labcorp Labcorp (NYSE: LH) is a global leader of innovative and comprehensive laboratory services that helps doctors, hospitals, pharmaceutical companies, researchers and patients make clear and confident decisions. We provide insights and advance science to improve health and improve lives through our unparalleled diagnostics and drug development laboratory capabilities. The company's nearly 70,000 employees serve clients in approximately 100 countries, provided support for 75% of the new drugs and therapeutic products approved in 2024 by the FDA, and performed more than 700 million tests annually for patients around the world. Learn more about us at Cautionary Statement Regarding Forward-Looking Statements This press release contains forward-looking statements, including, but not limited to, statements with respect to (i) the estimated 2025 guidance and related assumptions, (ii) the impact of various factors on operating and financial results, including the projected impact of global economic and market conditions on the company's businesses, operating results, cash flows and/or financial condition, (iii) future business strategies, (iv) expected savings, synergies and other benefits to the Company, customers or patients from acquisitions and other transactions and partnerships, and (v) opportunities for future growth. Each of the forward-looking statements is subject to change based on various important factors, many of which are beyond the company's control, including without limitation: (i) the effect of the holding company reorganization on the company's business generally; (ii) the failure to receive tax-free treatment with respect to the spin-off of the company's Clinical Development and Commercialization Services business, now Fortrea Holdings Inc. for U.S. federal income purposes; (iii) the impact of spin-off related items; (iv) personnel costs and potential difficulties with employee relations and retention; (v) the trading price of the company's stock, competitive actions and other unforeseen changes and general uncertainties in the marketplace; (vi) changes in government regulations, including healthcare reform; (vii) customer purchasing decisions, including changes in payer regulations or policies; (viii) adverse actions of governmental and third-party payers; (ix) changes in testing guidelines or recommendations; (x) the volume of COVID-19 Testing performed by the company; (xi) the impact of global geopolitical events; (xii) the effect of public opinion on the company's reputation; (xiii) adverse results in material litigation matters; (xiv) changes in laws and regulations applicable to the company, including healthcare reform, and changes to their interpretation and application and the impact of any such changes; (xv) failure to maintain or develop customer relationships; (xvi) the company's ability to develop or acquire new products and adapt to technological changes; (xvii) failure of the company's information technology, systems, or data security; (xviii) the impact of potential losses under repurchase agreements; (xix) adverse weather conditions; (xx) the number of revenue days in a financial period; (xxi) inflation; (xxii) increased competition; and (xxiii) the effect of exchange rate fluctuations. These factors, in some cases, have affected and in the future (together with other factors) could affect the company's ability to implement the company's business strategy, and actual results could differ materially from those suggested by these forward-looking statements. As a result, readers are cautioned not to place undue reliance on any of the forward-looking statements. The company has no obligation to provide any updates to these forward-looking statements even if its expectations change. All forward-looking statements are expressly qualified in their entirety by this cautionary statement. Further information on potential factors, risks and uncertainties that could affect operating and financial results is included in the company's most recent Annual Report on Form 10-K under the heading RISK FACTORS and in the company's other filings with the SEC. The information in this press release should be read in conjunction with a review of the company's filings with the SEC including the information in the company's most recent Annual Report on Form 10-K under the heading "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS". - End of Text - - Tables to Follow - LABCORP HOLDINGS INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In Millions, Except Per Share Data) Three Months Ended June 30,Six Months Ended June 30,2025202420252024 Revenues $ 3,527.3$ 3,220.9$ 6,872.4$ 6,397.5 Cost of revenues 2,481.12,294.54,878.24,573.8 Gross profit 1,046.2926.41,994.21,823.7 Selling, general, and administrative expenses 579.3557.81,125.31,066.2 Amortization of intangibles and other assets 68.362.2137.9122.3 Goodwill and other asset impairments ———2.5 Restructuring and other charges 4.111.610.516.6 Operating income 394.5294.8720.5616.1 Other (expense) income:Interest expense (57.1)(47.6)(113.1)(94.5) Investment income 1.71.38.24.2 Equity method loss, net (1.7)(0.3)(2.0)(0.2) Other, net (32.7)19.5(33.7)39.5 Earnings from operations before income taxes 304.7267.7579.9565.1 Provision for income taxes 66.462.1128.6131.2 Net earnings 238.3205.6451.3433.9 Less: Net earnings attributable to the noncontrolling interest (0.4)(0.3)(0.6)(0.6) Net earnings attributable to Labcorp Holdings Inc. $ 237.9$ 205.3$ 450.7$ 433.3 Earnings per common share:Basic earnings per common share $ 2.85$ 2.44$ 5.40$ 5.15 Diluted earnings per common share $ 2.84$ 2.43$ 5.36$ 5.13 Weighted-average basic common shares outstanding 83.484.183.584.1 Weighted-average diluted common shares outstanding 83.984.384.184.5 LABCORP HOLDINGS INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In Millions) June 30, 2025December 31, 2024 ASSETSCurrent assets:Cash and cash equivalents $ 647.3$ 1,518.7 Accounts receivable, net 2,120.61,944.1 Unbilled services 156.1152.9 Supplies inventory 508.1493.2 Prepaid expenses and other 655.1697.6 Total current assets 4,087.24,806.5 Property, plant, and equipment, net 3,133.83,045.4 Goodwill, net 6,551.16,369.7 Intangible assets, net 3,494.43,488.9 Joint venture partnerships and equity method investments 160.416.3 Other assets, net 633.0652.2 Total assets $ 18,059.9$ 18,379.0 LIABILITIES AND SHAREHOLDERS' EQUITYCurrent liabilities:Accounts payable $ 793.0$ 875.8 Accrued expenses and other 835.8871.2 Unearned revenue 398.0392.2 Short-term operating lease liabilities 186.1184.6 Short-term finance lease liabilities 4.36.1 Short-term borrowings and current portion of long-term debt 499.61,000.3 Total current liabilities 2,716.83,330.2 Long-term debt 5,077.35,331.2 Operating lease liabilities 713.1676.3 Financing lease liabilities 65.674.3 Deferred income taxes and other tax liabilities 354.5383.1 Other liabilities 643.2517.4 Total liabilities 9,570.510,312.5 Commitments and contingent liabilitiesNoncontrolling interest 16.714.3 Shareholders' equity:Common stock, 82.9 and 83.4 shares outstanding at June 30, 2025, and December 31, 2024, respectively 7.57.6 Additional paid-in capital 1.82.8 Retained earnings 8,498.08,303.4 Accumulated other comprehensive loss (34.6)(261.6) Total shareholders' equity 8,472.78,052.2 Total liabilities and shareholders' equity $ 18,059.9$ 18,379.0 LABCORP HOLDINGS INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In Millions) Three Months Ended June 30,Six Months Ended June 30,2025202420252024 CASH FLOWS FROM OPERATING ACTIVITIES:Net earnings $ 238.3$ 205.6$ 451.3$ 433.9 Adjustments to reconcile net earnings to net cash provided by operating activities:Depreciation and amortization 170.3156.9337.1311.4 Stock compensation 34.130.866.962.4 Operating lease right-of-use asset expense 50.844.599.488.6 Goodwill and other asset impairments ———2.5 Deferred income taxes (6.1)(19.6)(12.2)(39.1) Other, net 38.039.646.136.6 Change in assets and liabilities (net of effects of acquisitions and divestitures):Decrease (increase) in accounts receivable 30.9(5.1)(139.9)(192.2) Decrease (increase) in unbilled services 0.9(37.1)4.826.8 (Increase) decrease in supplies inventory (11.9)28.3(3.5)27.7 Decrease in prepaid expenses and other 12.846.557.821.6 Increase (decrease) in accounts payable 67.069.4(80.6)(51.7) Increase (decrease) in unearned revenue 0.210.8(8.7)(30.8) Decrease in accrued expenses and other (4.7)(9.5)(179.4)(166.4) Net cash provided by operating activities 620.6561.1639.1531.3 CASH FLOWS FROM INVESTING ACTIVITIES:Capital expenditures (77.9)(128.2)(203.9)(262.0) Proceeds from sale of assets 1.90.12.40.2 Proceeds from sale or distribution of equity affiliates or other investments 6.9—6.9— Proceeds from sale of business ———13.5 Purchase of equity affiliates or other investments (15.0)(23.0)(172.0)(36.7) Acquisition of businesses, net of cash acquired (10.0)(33.9)(63.5)(293.1) Net cash used for investing activities (94.1)(185.0)(430.1)(578.1) CASH FLOWS FROM FINANCING ACTIVITIES:Payments on senior notes ——(1,000.0)— Proceeds from revolving credit facilities —698.764.8951.9 Payments on revolving credit facilities —(721.3)(64.8)(932.1) Proceeds from accounts receivable securitization ——225.0— Net share settlement tax payments from issuance of stock to employees (3.5)(23.1)(29.0)(37.8) Net proceeds from issuance of stock to employees ——25.726.7 Dividends paid (59.9)(60.4)(121.5)(122.5) Purchase of common stock (200.0)(100.0)(200.0)(100.0) Other, net (4.0)(3.9)(7.3)(7.9) Net cash used for financing activities (267.4)(210.0)(1,107.1)(221.7) Effect of exchange rate changes on Cash and cash equivalents 18.8(0.3)26.7(3.2) Net increase (decrease) in Cash and cash equivalents 277.9165.8(871.4)(271.7) Cash and cash equivalents at beginning of period 369.499.31,518.7536.8 Cash and cash equivalents at end of period $ 647.3$ 265.1$ 647.3$ 265.1 LABCORP HOLDINGS INC. AND SUBSIDIARIES Condensed Combined Non-GAAP Segment Information (Dollars in Millions) Three Months Ended June 30,Six Months Ended June 30,2025202420252024 Diagnostics LaboratoriesRevenues $ 2,748.8$ 2,524.9$ 5,378.4$ 5,004.6 Adjusted operating income $ 482.8$ 441.5$ 910.3$ 859.4 Adjusted operating margin 17.6 %17.5 %16.9 %17.2 % Biopharma Laboratory ServicesRevenues $ 784.8$ 707.0$ 1,506.1$ 1,417.9 Adjusted operating income $ 123.3$ 107.4$ 230.2$ 207.3 Adjusted operating margin 15.7 %15.2 %15.3 %14.6 % ConsolidatedRevenues $ 3,527.3$ 3,220.9$ 6,872.4$ 6,397.5 Adjusted segment operating income $ 606.1$ 548.9$ 1,140.5$ 1,066.7 Unallocated corporate expense (74.5)(69.0)$ (139.9)$ (134.0) Consolidated adjusted operating income $ 531.6$ 479.9$ 1,000.6$ 932.7 Adjusted operating margin 15.1 %14.9 %14.6 %14.6 % The consolidated revenue and adjusted segment operating income are presented net of intersegment transaction eliminations and other amounts not used in determining segment performance. Adjusted operating income and adjusted operating margin are non-GAAP measures. See the subsequent reconciliation of non-GAAP financial measures. LABCORP HOLDINGS INC. AND SUBSIDIARIES Reconciliation of Non-GAAP Measures (Dollars and Shares in Millions, Except Per Share Data) Three Months Ended June 30,Six Months Ended June 30, 2025202420252024Adjusted Operating Income Operating income$ 394.5$ 294.8$ 720.5$ 616.1 Amortization of intangibles and other assets (a)68.362.2137.9122.3 Restructuring and other charges (b)4.111.610.516.6 Acquisition and disposition-related costs (c)15.125.144.246.0 Launchpad costs (d)17.231.537.340.4 Asset impairments (e)———2.5 Other31.931.846.443.5 TSA reimbursement (f)0.522.93.845.3 Adjusted operating income$ 531.6$ 479.9$ 1,000.6$ 932.7Adjusted operating profit margin15.1 %14.9 %14.6 %14.6 %Adjusted Net Income Net income$ 237.9$ 205.3$ 450.7$ 433.3 Impact of adjustments to operating income137.1185.1280.1316.6 Loss on venture fund investments, net (g)32.71.536.15.7 Gain on sale of business (h)———(4.9) TSA reimbursement (f)(0.5)(22.9)(3.8)(45.3) Other 0.70.30.70.3 Income tax impact of adjustments (i)(43.4)(37.3)(75.3)(61.5) Adjusted net income$ 364.5$ 332.0$ 688.5$ 644.2Weighted-average diluted common shares outstanding83.984.384.184.5Adjusted net income per share$ 4.35$ 3.94$ 8.19$ 7.62 (a) Amortization of intangible assets acquired as part of business acquisitions. (b) Restructuring and other charges represent amounts incurred in connection with the elimination of redundant positions and facilities and contract termination costs within the organization in connection with our LaunchPad initiatives, and acquisitions or dispositions of businesses by the company. (c) Acquisition and disposition-related costs include due-diligence legal and advisory fees, retention bonuses, impact of delayed contract or license transfers, and other integration or disposition related activities. (d) LaunchPad costs include non-capitalized costs associated with the implementation of systems, consolidation of processes, and consulting costs incurred as part of various business process improvement initiatives. (e) The company impaired certain fixed assets which are no longer realizable by the business. (f) Represents transition services fees charged to Fortrea Holdings Inc. related to administrative and IT systems support. The costs to provide these services are included in operating income but the service fees are included in other income. (g) The company makes investments in companies or investment funds developing promising technology related to its operations. The company recorded net gains and losses related to several distributions from venture funds, increases in the market value of investments, and impairments of other investments due to the underlying performance of the investments. (h) The company recorded a gain on the disposition of the Beacon Laboratory Benefits Solutions business. (i) Income tax impact of adjustments calculated based on the tax rate applicable to each item. View original content to download multimedia: SOURCE Labcorp Holdings Inc
Yahoo
13-05-2025
- Business
- Yahoo
LH Q1 Earnings Call: Labcorp Grows Revenue but Misses Expectations, Raises Adjusted EPS Guidance
Healthcare diagnostics company Labcorp Holdings (NYSE:LH) missed Wall Street's revenue expectations in Q1 CY2025, but sales rose 5.3% year on year to $3.35 billion. Its non-GAAP profit of $3.84 per share was 2.8% above analysts' consensus estimates. Is now the time to buy LH? Find out in our full research report (it's free). Revenue: $3.35 billion vs analyst estimates of $3.41 billion (5.3% year-on-year growth, 1.9% miss) Adjusted EPS: $3.84 vs analyst estimates of $3.73 (2.8% beat) Adjusted EBITDA: $560.6 million vs analyst estimates of $577.1 million (16.8% margin, 2.9% miss) Management slightly raised its full-year Adjusted EPS guidance to $16.05 at the midpoint Operating Margin: 9.7%, in line with the same quarter last year Free Cash Flow was -$107.5 million compared to -$163.6 million in the same quarter last year Organic Revenue rose 2.1% year on year, in line with the same quarter last year Market Capitalization: $21 billion Labcorp's first quarter results reflected higher demand in its core diagnostics business, as management pointed to a rebound in test volumes after weather disruptions earlier in the quarter. CEO Adam Schechter cited ongoing growth in the company's managed care contracts and successful integration of recent acquisitions as factors supporting revenue. Schechter also highlighted the launch of new tests in oncology, women's health, autoimmune disease, and neurology as helping Labcorp capture more patient volume in high-growth therapeutic areas. Looking ahead, Labcorp slightly raised its full-year adjusted EPS guidance, with management confident in margin expansion through cost savings and operational efficiencies. Julia Wang, CFO, explained that guidance now factors in potential tariff impacts and ongoing regulatory uncertainty, but benefits from the company's expense control initiatives and supply chain flexibility. Schechter emphasized the company's ability to offset rising personnel costs and external headwinds, stating, 'We think we'll be able to offset the impacts from tariffs.' Labcorp's management focused on business execution, segment momentum, and adapting to a changing regulatory and macroeconomic environment. Diagnostics volume recovery: The diagnostics segment benefitted from a rebound in test volumes after weather-related softness early in the quarter, with organic growth improving when adjusted for these headwinds. Integration of Invitae acquisition: Management reported Invitae is on track to deliver over 10% revenue growth and become slightly accretive to earnings for the full year. The integration is progressing better than anticipated, and the acquisition is seen as a key contributor to growth in high-potential areas such as oncology and women's health. New test launches and innovation: Labcorp introduced several new tests, including a liquid biopsy for personalized cancer treatment and a blood-based biomarker for Alzheimer's disease. These offerings are expected to help Labcorp expand in faster-growing therapeutic segments. Operational efficiency initiatives: The company continues to drive savings through its LaunchPad program and the rollout of digital tools, such as eClaim Assist for billing and a diagnostics assistant for providers, aimed at improving both margins and customer experience. Tariff and regulatory planning: Management discussed contingency planning for various tariff and regulatory scenarios, emphasizing that supply chain flexibility and long-term contracts with U.S. suppliers help minimize risks. The company's guidance range incorporates what it views as the most likely macroeconomic and policy scenarios. Labcorp's outlook for the remainder of the year emphasizes margin improvement, continued acquisition integration, and resilience to external pressures, with a focus on high-growth testing categories. Continued product and test expansion: Management expects new test launches, especially in oncology and neurology, to drive above-market growth. The focus is on expanding test menus that meet unmet clinical needs and attract new customer segments. Cost management and operational leverage: The LaunchPad cost savings program and adoption of digital workflow tools are anticipated to offset inflationary pressures, including rising personnel costs and potential tariff impacts. Regulatory and payer landscape: Ongoing monitoring of U.S. policy changes such as PAMA (Protecting Access to Medicare Act) and new tariffs remains a risk, but management believes that diversified payer contracts and contingency planning will support stable performance. Michael Cherny (Leerink Partners): Asked about volatility in biopharma laboratory services and the impact of regulatory changes. Management said the guidance range reflects possible study delays but has not seen significant disruptions so far. Ann Hynes (Mizuho): Inquired about the degree to which tariffs are now incorporated into guidance. CEO Adam Schechter explained that most supply contracts are U.S.-based and multi-year, so tariff exposure is limited and manageable. Erin Wright (Morgan Stanley): Sought clarity on the split between organic and acquisition-driven growth in diagnostics, as well as the impact of weather. CFO Julia Wang clarified that, adjusted for weather, organic growth was consistent with historical trends. Lisa Gill (JP Morgan): Asked about the regulatory outlook for animal testing in early development. Schechter estimated this is 10–15% of the biopharma segment's revenue and does not expect a major impact this year. Jack Meehan (Nephron Research): Pressed for details on Invitae's trajectory toward accretion. Management reported integration is proceeding well, with cost savings expected to make Invitae slightly accretive to earnings by year-end. In the coming quarters, the StockStory team will be watching (1) progress in integrating acquisitions such as Invitae and the resulting impact on margins, (2) the launch and adoption of new high-growth diagnostic tests—particularly in oncology and neurology, and (3) management's ability to offset inflationary and tariff headwinds through operational efficiency programs. The evolution of the regulatory landscape and updates on Labcorp's business development pipeline will also be important signposts for tracking the company's execution. Labcorp currently trades at a forward P/E ratio of 15.2×. Should you double down or take your chips? Find out in our free research report. Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
Time of India
30-04-2025
- Business
- Time of India
Labcorp beats quarterly profit estimate on diagnostic test demand
Bengaluru: Laboratory operator Labcorp beat analysts' estimate for first-quarter profit on Tuesday, helped by robust demand for its diagnostic tests. Healthy demand for non-urgent surgeries , especially among older Americans, over the last few quarters has buoyed the demand for diagnostic checkups. Revenue from its diagnostic laboratories business grew 6 per cent to $2.63 billion during the period, even though it was negatively impacted by adverse weather. Labcorp and peer Quest Diagnostics have also benefited from deals to manage hospital labs as they seek market share gains. The North Carolina-based company's revenue rose 5.3 per cent to $3.35 billion, but missed analysts' average estimate of $3.40 billion, according to data compiled by LSEG. Excluding one-off items, it earned $3.84 per share during the quarter ended March 31, compared with the estimate of $3.74 per share. "While the macroeconomic environment remains dynamic, the critical nature of the work we do in diagnostics and drug development positions us well for success in 2025 and beyond," CEO Adam Schechter said. "We continue to progress our pipeline of attractive acquisitions and partnerships and further expand our test menu in four strategic areas, including oncology, women's health, autoimmune disease and neurology." Labcorp raised the lower end of its 2025 adjusted profit forecast to $15.70 from $15.60 per share previously, keeping the upper end unchanged at $16.40 per share.
