IDEXX Laboratories Inc. (NASDAQ:IDXX) on Monday reported better-than-expected fourth-quarter financial results and issued a fiscal 2026 forecast.
The animal health company reported fourth-quarter 2025 earnings of $3.08 per share, up 18% year over year, beating the consensus of $2.94. Comparable earnings were $2.92 per share.
The company reported sales of $1.091 billion, beating the consensus of $1.073 billion, up 14% on a reported and 12% on an organic basis.
Segment Overview
Companion Animal Group (CAG) revenue was $998.5 million. The 14.7% growth was led by CAG Diagnostics' recurring revenue growth of 12% (+10% organic), outpacing sector growth levels. U.S. growth was aided by increased diagnostic frequency, including early benefits from an aging pet population.
CAG Diagnostics' capital instrument revenues of $58.13 million expanded 76% as reported and 69% on an organic basis, led by record quarterly instrument placements, including benefits from over 1,900 IDEXX inVue Dx placements and nearly 1,400 new and competitive Catalyst placements.
Water revenues grew 12% reported and 10% organic for the quarter to $50.53 million, reflecting solid growth in the U.S. and International regions.
LPD revenues increased 8% reported and 4% organic to $37.48 million, led by solid gains in North and Latin America across major product categories.
Gross and Operating Profit
Gross profit increased 15% as reported and 13% on a comparable basis to $658.1 million. Gross margin of 60.3% expanded 50 basis points as reported and 60 basis points on a comparable basis, supported by volume gains, reference laboratory productivity initiatives, and net price realization, helping to offset inflationary impacts.
Operating margin was 28.9% in the quarter, 150 basis points higher than the prior year period results on a reported basis and 120 basis points on a comparable basis.
Guidance
"We enter 2026 with an exciting innovation pipeline, expanding instrument and software installed bases, and strong momentum across our global business," said Jay Mazelsky, President and CEO, in a press release on Monday.
IDEXX Laboratories expects fiscal 2026 earnings of $14.29-$14.80 per share compared to the consensus of $14.39.
The pet healthcare company forecasts 2026 annual sales of $4.632 billion-$4.720 billion compared to the consensus of $4.658 billion, led by CAG Diagnostics recurring revenue growth of 8.6% – 10.6% as reported and 8.0% – 10.0% on an organic basis.
Analyst View
"Despite end-market visit weakness, IDXX shares have been hovering near an all-time high in the midst of investor enthusiasm surrounding the company's new product cycle," William Blair wrote in an investor note on Monday.
"We believe Idexx's current innovation cycle should provide incremental confidence that the company has the levers it needs to meet expectations in this still-challenging environment," analyst Ryan S. Daniels wrote.
IDXX Price Action: IDEXX Laboratories shares were down 5.57% at $633.10 at the time of publication on Monday, according to Benzinga Pro data.
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