2023-04-26 07:07:17 ET
COVID-leveraged healthcare firms continued to disappoint in the Q1 2023 earnings season as Thermo Fisher Scientific ( NYSE: TMO ) fell ~4% in the pre-market Wednesday after reporting a ~9% YoY decline in its quarterly topline driven by its underperforming life sciences segment.
The Waltham, Massachusetts-based COVID test maker reported $10.7B revenue for the quarter, slightly ahead of Street forecasts, while its Life Sciences Solutions segment lagged expectations bringing $2.6B to the topline, indicating a ~38% YoY decline.
However, the largest business segment Laboratory Products and Biopharma Services, added $5.7B in revenue, beating Wall Street estimates with ~6% YoY growth.
Meanwhile, Analytical Instruments and Specialty Diagnostics brought $1.7B and $1.1B in revenue, making up ~16% and 10% of the topline, respectively.
Thermo Fisher ( TMO ) reported a better-than-expected ~8% decline in organic revenue while its core organic revenue growth stood at 6%, and COVID-19 testing revenue dropped to $0.14B from $0.37B in the preceding quarter.
TMO’s non-GAAP operating income lagged expectations to reach $2.33B as the adj. operating margin dropped to 21.8% from 29.2% in the prior year.
Notably, margins in the Life Sciences Solutions segment fell to 32.0% from 51.4% in the prior year, while those in the Laboratory Products and Biopharma Services rose to 13.8% from 11.4%.
“We are incredibly well positioned to deliver differentiated performance, as we continue to create value for all of our stakeholders and build an even brighter future for our company, Chief Executive Marc Casper said ahead of the earnings call, where TMO intends to provides its 2023 outlook.
On Tuesday, rival life sciences company Danaher Corporation ( DHR ) lost ~9% as its Q1 topline indicated a ~7% YoY contraction due to lower COVID-related sales.
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Thermo Fisher lower as life sciences unit underperforms in Q1