IDXX Q1 Earnings Beat, FY25 View Raised, Stock Up in Pre-Market

IDEXX Laboratories, Inc. IDXX posted first-quarter 2025 earnings per share (EPS) of $2.96, up 5.3% year over year. The figure surpassed the Zacks Consensus Estimate by 1.4%. 

Comparable constant-currency EPS of $2.91 improved 7.4% year over year.

Following the earnings announcement, IDXX shares gained 1.6% in the pre-market trading today.

IDEXX’s Q1 Revenues in Detail

Quarterly revenues increased 3.6% year over year (up 5% organically) to $998.4 million. The reported figure missed the Zacks Consensus Estimate by 1.8%. (See the Zacks Earnings Calendar to stay ahead of market-making news.) 

This year-over-year upside was primarily driven by Companion Animal Group ("CAG") Diagnostics’ recurring revenue growth of 3% on a reported basis and 4.5% organically.

Veterinary software, services and diagnostic imaging systems’ revenues increased 9% on a reported basis and 7% organically.

IDEXX’s Segmental Analysis

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

CAG’s revenues rose 3.4% year over year on a reported basis and 4.4% on an organic basis to $919.8 million.

The Water segment’s revenues increased 5.2% year over year on a reported and 7.3% on an organic basis to $45.3 million.

For the first quarter, LPD revenues increased 1.4% reportedly and 4.2% on an organic basis to $28.6 million.           

Revenues from the Other segment increased 32.2% on a reported basis and organic basis to $4.7 million.

IDEXX’s Margin Performance

The gross profit rose 5.1% to $623.4 million. The gross margin expanded 92 basis points (bps) to 62.4% despite a 1.1% rise in the cost of revenues.

Sales and marketing expenses rose 4.5% to $156.2 million. G&A expenses fell 0.5% to $91.6 million. R&D expenses jumped 12.2% to $59.1 million. The operating profit in the reported quarter rose 5.9% year over year to $316.5 million. The operating margin in the quarter expanded 69 bps to 31.7%.

IDEXX’s Financial Position

IDEXX exited the first quarter with cash and cash equivalents of $164 million compared with $288.3 million at the end of the fourth quarter of 2024. Total debt (including the current portion) was $449.8 million, which was in line with the figure of fourth-quarter 2024.

The net cash provided by operating activities was $238 million compared with $198.6 million in the prior-year period.

IDEXX’s Updated 2025 Guidance

Total revenues for 2025 are now expected in the range of $4,095-$4,210 million, indicating growth of 5-8% on a reported basis and 6-9% on an organic basis. The Zacks Consensus Estimate is currently pegged at $4.09 billion.

IDEXX Laboratories, Inc. Price, Consensus and EPS Surprise

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

IDEXX expects full-year EPS in the range of $11.93-$12.43, indicating reported growth of 12-17%. The Zacks Consensus Estimate for full-year EPS is currently pegged at $11.96.

Our View on IDEXX

IDEXX exited the first quarter on a mixed note. While earnings beat estimates, revenues lagged the same. The CAG segment achieved solid organic revenue growth supported by benefits from IDEXX execution drivers, including continued solid new business gains and strong global premium instrument installed base growth. 

The Water segment benefited from net price improvement and solid gains across all regions. Growth in LPD was backed by solid gains across the United States and Latin America regions. Moreover, the expansion of both margins in the quarter buoys optimism.

On an impressive note, IDEXX is leading the charge in a new wave of major innovation, such as launching IDEXX Cancer Dx screening for canine lymphoma in its North America’s reference laboratories. 

IDEXX’s Zacks Rank & Key Picks

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

Some better-ranked stocks from the broader medical space are AngioDynamics ANGO, Veeva Systems VEEV and Masimo MASI. 

AngioDynamics, currently sporting a Zacks Rank #1 (Strong Buy), reported third-quarter fiscal 2025 adjusted EPS of 3 cents in contrast to the Zacks Consensus Estimate of a loss of 13 cents. You can see the complete list of today’s Zacks #1 Rank stocks here.

Revenues of $72 million beat the Zacks Consensus Estimate by 2%. ANGO has an estimated fiscal 2026 earnings growth rate of 27.8% compared with the S&P 500 composite’s 10.5%. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 70.9%.

Veeva Systems, sporting a Zacks Rank #1 at present, posted fourth-quarter fiscal 2025 adjusted EPS of $1.75, which exceeded the Zacks Consensus Estimate by 10.1%. Revenues of $720.9 million surpassed the Zacks Consensus Estimate by 3.2%.

VEEV has an estimated long-term earnings growth rate of 26.6% compared with the industry’s 20.8%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.9%.

Masimo, currently sporting a Zacks Rank #1, reported a fourth-quarter 2024 adjusted EPS of $1.80, which surpassed the Zacks Consensus Estimate by 20.8%. Revenues of $600.7 million topped the Zacks Consensus Estimate by 0.8%.

MASI has an estimated earnings yield of 3.5% for fiscal 2025 compared with the industry’s 3.6%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 14.4%.

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

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