IDEXX Stock Down Despite Q4 Earnings & Revenue Beat, Margins Rise

IDEXX Laboratories, Inc. IDXX posted fourth-quarter 2025 earnings per share (EPS) of $3.08, up 18% year over year. The figure surpassed the Zacks Consensus Estimate by 5.17%.

Comparable constant-currency EPS of $2.92 improved 17% year over year.

Full-year 2025 earnings of $13.08 rose 22.6% from the 2024 level. The figure exceeded the Zacks Consensus Estimate by 1.2%.

IDEXX’s Revenues

Quarterly revenues increased 14% year over year (up 12% organically) to $1.09 billion. The reported figure topped the Zacks Consensus Estimate by 1.86%.

This year-over-year upside was primarily driven by Companion Animal Group ("CAG") growth of 15% as reported and 13% organic, and Water revenue growth of 12% as reported and 10% organic.

Veterinary software, services and diagnostic imaging systems’ revenues increased 13% on a reported basis (same organically), driven by the expansion of cloud-native software installed base.

Full-year 2025 total revenues of $4.30 billion improved 10% on a reported basis as well as organically from the 2024 level, driven by 9% as reported and 8% organic growth in CAG Diagnostics recurring revenue. The figure beat the Zacks Consensus Estimate by 0.5%.

Following the earnings announcement, IDXX shares lost 1.5% in the pre-market trading today.

IDEXX’s Q4 Revenue Analysis by Segments

IDEXX derives revenues from four operating segments: CAG, Water, Livestock, Poultry andDairy (“LPD”), and Other.

CAG’s revenues rose 14.7% year over year on a reported basis and 12.8% on an organic basis to $998.5 million.

IDEXX Laboratories, Inc. Price, Consensus and EPS Surprise

IDEXX Laboratories, Inc. price-consensus-eps-surprise-chart | IDEXX Laboratories, Inc. Quote

The Water segment’s revenues increased 11.9% year over year on a reported and 9.5% on an organic basis to $50.5 million.

For the fourth quarter, LPD revenues jumped 8.5% reportedly and 4% on an organic basis to $37.5 million.          

Revenues from the Other segment dropped 0.4% on a reported basis as well as organically to $4.1 million.

IDEXX’s Margin Performance

The gross profit rose 15.3% to $658.1 million. The gross margin expanded 55 basis points (bps) to 60.4% despite a 12.7% rise in the cost of revenues.

Sales and marketing expenses surged 11.3% to $167.1 million. G&A expenses rose 7.4% to $109 million. R&D expenses jumped 15.8% to $66.8 million. The operating profit in the reported quarter rose 20.6% year over year to $315.6 million. The operating margin in the quarter expanded 152 bps to 28.9%.

IDEXX’s Financial Position

IDEXX exited the fourth quarter with cash and cash equivalents of $180.1 million compared with $288.3 million at the end of 2024.

Cumulative net cash provided by operating activities was $1.18 billion compared with $929 million in the prior-year period.

IDEXX Issues 2026 Guidance

IDEXX provided an initial outlook for 2026, forecasting revenues in the range of $4,632 million-$4,720 million. This implies 7.6%-9.6% growth on a reported basis and 7%-9% on an organic basis. The Zacks Consensus Estimate is currently pegged at $4.66 billion.

Full-year EPS is projected to be between $14.29 and $14.80, calling for growth of 9-13%. The Zacks Consensus Estimate for the same is currently pegged at $14.45.

Our View on IDEXX

IDEXX exited the fourth quarter with both revenues and earnings beating estimates. The performance was supported by consistently high levels of execution by IDEXX teams around the world. U.S. CAG Diagnostics’ recurring revenue growth was aided by increased diagnostic frequency, including early benefits from an aging pet population. The expansion of both margins in the quarter is also encouraging.

2025 marked a pivotal year for the company, highlighted by the launch of IDEXX Cancer Dx for canine lymphoma and strong adoption of IDEXX inVue Dx. Together, these innovations signal a new phase of growth, expanding the role of diagnostics in earlier disease detection while helping veterinarians improve efficiency and manage workflow complexity. IDEXX enters 2026 with a robust innovation pipeline, expanding instrument and software installed bases, and strong momentum across the global business.

IDEXX’s Zacks Rank & Key Picks

IDXX currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the broader medical space are Intuitive Surgical ISRG, Resmed RMD and Veeva Systems VEEV.

Intuitive Surgical, currently sporting a Zacks Rank #1 (Strong Buy), reported a fourth-quarter 2025 adjusted EPS of $2.53, which surpassed the Zacks Consensus Estimate by 12.4%. Revenues of $2.87 billion beat the Zacks Consensus Estimate by 4.7%. You can see the complete list of today’s Zacks #1 Rank stocks here.

ISRG has an estimated long-term earnings growth rate of 15.7% compared with the industry’s 12.7% growth. The company beat earnings estimates in each of the trailing four quarters, the average surprise being 13.24%.

Resmed, carrying a Zacks Rank #2 (Buy) at present, posted a second-quarter fiscal 2026 adjusted EPS of $2.81, exceeding the Zacks Consensus Estimate by 4.59%. Revenues of $1.42 billion topped the Zacks Consensus Estimate by 2.30%.

RMD has an earnings yield of 4.25% compared with the industry’s 2.6% yield. The company’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 2.74%.

Veeva Systems, carrying a Zacks Rank #2 at present, posted a third-quarter fiscal 2026 adjusted EPS of $2.04, exceeding the Zacks Consensus Estimate by 4.62%. Revenues of $811.24 million topped the Zacks Consensus Estimate by 2.44%.

VEEV has an earnings yield of 3.6% compared with the industry’s yield of -1.7%. The company’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 8.18%.

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This article originally published on Zacks Investment Research (zacks.com).

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