QuidelOrtho’s first quarter results received a strong positive reaction from the market, driven by better-than-expected profitability and stable core business performance despite a year-over-year revenue decline. Management attributed the quarter’s momentum to cost-saving initiatives and robust growth in its labs and immunohematology businesses. CEO Brian Blaser highlighted that, excluding COVID and donor screening, the company achieved mid-single-digit revenue growth, largely due to strong clinical chemistry and immunoassay testing, as well as a solid flu season. Management emphasized that the company’s operational discipline and focused strategy led to significant improvements in margins and earnings. Blaser stated, “Our business faced unique challenges and an increasingly dynamic environment. The organization came together around our common mission with our customers at the center of everything we do.”
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QuidelOrtho (QDEL) Q1 CY2025 Highlights:
- Revenue: $692.8 million vs analyst estimates of $689.8 million (2.6% year-on-year decline, in line)
- Adjusted EPS: $0.74 vs analyst estimates of $0.59 (24.9% beat)
- Adjusted EBITDA: $159.8 million vs analyst estimates of $149.4 million (23.1% margin, 7% beat)
- The company reconfirmed its revenue guidance for the full year of $2.71 billion at the midpoint
- Management reiterated its full-year Adjusted EPS guidance of $2.32 at the midpoint
- EBITDA guidance for the full year is $595 million at the midpoint, in line with analyst expectations
- Operating Margin: 4.7%, up from -247% in the same quarter last year
- Constant Currency Revenue fell 1.1% year on year (-15.5% in the same quarter last year)
- Market Capitalization: $2.04 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions QuidelOrtho’s Q1 Earnings Call
- Conor McNamara (RBC): Asked how much of the tariff cost could be offset by pricing given the prevalence of reagent rental contracts. CEO Brian Blaser responded that selective pricing actions are possible but must consider market competitiveness, referencing the company’s pandemic-era experience with inflation pass-through.
- Patrick Donnelly (Citi): Sought details on tariff exposures and confidence in mitigation. CFO Joe Busky explained that most products are U.S.-made, with primary tariff concerns relating to immunoassay products from the UK; he reiterated confidence that mitigation actions would fully offset gross impacts.
- Patrick Donnelly (Citi): Inquired about the Savanna program’s ongoing commitment and timing. Blaser stressed a focus on completing the FDA submission, calling molecular diagnostics a priority while declining to speculate on outcomes beyond current milestones.
- Andrew Brackmann (William Blair): Questioned the basis for China growth guidance. Busky cited strong performance in labs and immunohematology, noting that visibility into these recurring businesses supports confidence in mid- to high-single-digit growth for the year.
- Jack Meehan (Nephron Research): Asked whether a shift toward flu combo testing is structural and implications if COVID revenues decline. Management highlighted the durability of the combo test, stating it continues to provide stable revenue despite a year-over-year drop in standalone COVID testing.
Catalysts in Upcoming Quarters
In the coming quarters, our team will closely watch (1) the pace and effectiveness of the company’s tariff mitigation strategies, (2) the FDA submission and potential approval timeline for the Savanna respiratory panel, and (3) sustained execution of cost control initiatives and their impact on margins. We will also monitor demand trends in key regions and the durability of the core labs segment as further indicators of performance.
QuidelOrtho currently trades at $30.21, up from $25.82 just before the earnings. Is there an opportunity in the stock?Find out in our full research report (it’s free).
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