Quest Diagnostics Reports Strong Q4 Results

Quest Diagnostics, the leading provider of medical testing services based in Secaucus, N.J., announced impressive financial results for the fourth quarter. Despite a significant slowdown in Covid-19 testing, the company experienced a surge in net income by 90%.

In the fourth quarter, Quest Diagnostics reported earnings of $192 million, equivalent to $1.70 per share. This is a substantial increase compared to $101 million, or 87 cents per share, in the previous year. Adjusted earnings came in at $2.15 per share, surpassing the mean analyst estimate of $2.11 per share.

Although fourth-quarter revenue declined by 1.9% to $2.29 billion, it exceeded the average Wall Street estimate of $2.25 billion. The drop can be attributed to an 80% decrease in Covid-19 testing revenue, which plummeted to $37 million. As the virus transitioned to an endemic status, awareness diminished and demand for Covid testing services significantly declined.

However, the decline in Covid-related revenue was offset by a 4.7% increase in base business revenue, reaching $2.25 billion during the fourth quarter. For the full year 2023, base revenue demonstrated even stronger growth of 7.1%, amounting to $9.03 billion. In contrast, Covid-related revenue experienced a significant decline by 85% to $223 million.

Looking ahead, Quest Diagnostics has provided its forecast for 2024. The company expects earnings per share to range between $7.69 and $7.99, with adjusted earnings projected to be between $8.60 and $8.90 per share. Net revenue for 2024 is estimated to be between $9.35 billion and $9.45 billion, representing a modest increase of 1.1% to 2.1% compared to 2023 levels.