Quest Diagnostics (DGX) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenues reached $2.65B, up 12.1% year-over-year, with 2.4% organic growth, driven by acquisitions, enterprise accounts, and advanced diagnostics demand.

• Net income attributable to shareholders rose 13.2% to $220M, with diluted EPS up 12.8% to $1.94; adjusted EPS was $2.21, up 8.3%.

• Diagnostic Information Services accounted for over 95% of revenues, with volume growth primarily from acquisitions.

• Expanded automation, robotics, and AI initiatives, including Project Nova, to improve quality, productivity, and customer experience.

• Reaffirmed full-year 2025 revenue and adjusted EPS guidance, citing resilience despite macroeconomic uncertainty.

Financial highlights

• Diagnostic Information Services revenues grew 12.7% year-over-year to $2.59B; DS revenues declined 7.7% due to lower risk assessment services.

• Adjusted operating income: $406M (15.3% margin), up from $349M (14.8%) last year; reported operating income: $346M (13.0% margin).

• Cash from operations: $314M, up from $154M year-over-year; capital expenditures for the quarter were $117M.

• Revenue per requisition up 0.3% (total), 3.6% (organic) year-over-year; total requisition volume up 12.4%, organic volume down 0.9%.

• Net income attributable to shareholders was $220M, up from $194M a year ago.

Outlook and guidance

• 2025 revenue guidance: $10.7B–$10.85B; adjusted EPS: $9.55–$9.80; reported EPS: $8.62–$8.87.

• Organic revenue growth expected at ~3%, with additional growth from 2024 acquisitions.

• Operating margin expected to expand; net interest expense forecast at ~$275M; adjusted tax rate at ~25%.

• Operating cash flow guidance raised by $50M due to a CARES Act payroll tax credit; cash from operations projected at ~$1.5B, capex at ~$500M.

• Share count for 2025 expected at ~114M diluted shares.