QuidelOrtho Corporation QDEL delivered adjusted earnings per share (EPS) of 63 cents in the fourth quarter of 2024, down 46.2% year over year. The figure, however, topped the Zacks Consensus Estimate by 14.6%.

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The adjustments include expenses related to the amortization of intangibles, and acquisition and integration costs, among others.

GAAP loss per share for the quarter was $2.28 against the year-earlier EPS of 10 cents.

Full-year 2024 EPS was $1.85, down 55.2% from the comparable 2023 period. However, the metric surpassed the Zacks Consensus Estimate by 4.5%.

QDEL’s Revenues in Detail

QuidelOrtho registered revenues of $707.8 million in the fourth quarter of 2024, which decreased 4.7% year over year on a reported basis and 4.4% at constant exchange rate (CER). However, the figure surpassed the Zacks Consensus Estimate by 0.8%.

In the fourth quarter, Respiratory revenues were $143.2 million (down 17.9% on both reported basis and at CER), while Non-Respiratory revenues were $564.6 million (down 0.6% on reported basis and 0.2% at CER).

Full-year 2024 revenues were $2.78 million, reflecting a 7.2% decrease from the comparable 2023 period. The metric was in line with the Zacks Consensus Estimate.

Shares of this company gained nearly 3.5% in yesterday’s after-hours trading.

QuidelOrtho’s Business Units in Detail

QuidelOrtho derives revenues from five business units — Labs, Immunohematology, Donor Screening, Point of Care and Molecular Diagnostics. As a result of the wind-down of the U.S. Donor Screening portfolio, the previously reported Transfusion Medicine business unit is shown in its two product categories — Immunohematology and Donor Screening.

In the fourth quarter, Labs revenues were $359.7 million, up 2.2% on reported basis and 2.8% at CER.

Immunohematology revenues were $136.7 million in the fourth quarter, up 3.3% and 3.5% on a reported basis and at CER, respectively.

Donor Screening revenues were $19.8 million in the fourth quarter, down 40.2% and 40.1% on a reported basis and at CER, respectively.

Point of Care revenues amounted to $184.8 million in the fourth quarter, reflecting a decline of 14.8% on both reported basis and at CER.

Molecular Diagnostics revenues totaled $6.8 million in the fourth quarter, down 20% and 21.4% on a reported basis and at CER, respectively.

QDEL’s Geographical Distribution

Geographically, QuidelOrtho derives revenues from North America, Europe, the Middle East and Africa (EMEA), China and Other regions (which includes Latin America, Japan and other Asia-Pacific markets).

Revenues from North America amounted to $399.6 million, reflecting a decline of 11.3% and 11.4% on a reported basis and at CER, respectively.
EMEA revenues amounted to $85.9 million, reflecting a decrease of 5.5% on a reported basis and 6.1% at CER.

Revenues from China amounted to $86.9 million, reflecting an improvement of 12.7% on a reported basis and 10.9% at CER.

Revenues from Other regions amounted to $135.4 million, reflecting an uptick of 8.9% on a reported basis and 12.9% at CER.

QuidelOrtho’s Margin Trend

In the quarter under review, QuidelOrtho’s gross profit declined 14.8% year over year to $326.1 million. The gross margin contracted 545 basis points (bps) to 46.1%.

Selling, marketing and administrative expenses fell 0.1% year over year to $187.5 million. Research and development expenses declined 20.2% year over year to $47.3 million. Adjusted operating expenses of $234.8 million decreased 4.9% year over year.

Adjusted operating profit totaled $91.3 million, reflecting a 32.7% decline from the prior-year quarter’s level. Adjusted operating margin in the fourth quarter contracted 537 bps to 12.9%.

QDEL’s Financial Position

QuidelOrtho exited 2024 with cash and cash equivalents of $98.3 million compared with $118.9 million at the end of 2023. Total debt (including short-term debt) at the end of 2024 was $2.48 billion compared with $2.41 billion at 2023-end.

Cumulative net cash provided by operating activities at the end of 2024 was $83 million compared with $280.2 million a year ago.

QuidelOrtho’s Guidance

QuidelOrtho has initiated its financial outlook for 2025.

Total revenues are expected to lie in the range of $2.60 billion-$2.81 billion billion. The Zacks Consensus Estimate is pegged at $2.77 billion.

For the full year, Labs business growth is expected to be in the mid-single digits, while Transfusion Medicine business growth (excluding U.S. Donor Screening) is likely to be in the low-single digits. Point of Care business growth, excluding COVID-19, is expected to be in the mid-single-digits. 

On a regional basis, China’s growth is likely to be in mid-to high-single-digits.

Within the Respiratory revenues for the full year, COVID-19 revenues are expected to be $110-$140 million. QuidelOrtho assumes no government contract revenues during the period.

Adjusted EPS is expected to lie between $2.07 and $2.57. The Zacks Consensus Estimate stands at $2.44.

Our Take

QuidelOrtho ended the fourth quarter of 2024 with better-than-expected results. The company registered robust revenues from its Labs and Immunohematology business units and China and Other regions, which were encouraging. 

Per management, growth of QDEL’s underlying business with its recurring revenue business model continued to perform well during the quarter. The company also made progress on implementing its cost-savings initiatives and is targeting additional cost savings across the business. Management expects that these initiatives will enable QuidelOrtho to operate more effectively and deliver incremental margin improvement in 2025 and beyond. This looks promising for the stock.

However, dismal top-line and bottom-line results were disappointing. Lower Respiratory and Non-Respiratory revenues during the quarter were also not promising. The decline in its Donor Screening, Point of Care and Molecular Diagnostics units and geographically in North America and EMEA was discouraging. The contraction of both margins also does not bode well.

QDEL’s Zacks Rank and Key Picks

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

Some better-ranked stocks in the broader medical space that have announced quarterly results are Cardinal Health, Inc. CAH, ResMed Inc. RMD and Boston Scientific Corporation BSX.

Cardinal Health, carrying a Zacks Rank of 2 (Buy), reported second-quarter fiscal 2025 adjusted EPS of $1.93, beating the Zacks Consensus Estimate by 10.3%. Revenues of $55.26 billion outpaced the consensus mark by 0.7%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Cardinal Health has a long-term estimated growth rate of 10.7%. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%.

ResMed reported second-quarter fiscal 2025 adjusted EPS of $2.43, beating the Zacks Consensus Estimate by 5.7%. Revenues of $1.28 billion surpassed the Zacks Consensus Estimate by 1.6%. It currently carries a Zacks Rank #2.

ResMed has a long-term estimated growth rate of 16%. RMD’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.9%.

Boston Scientific reported fourth-quarter 2024 adjusted EPS of 70 cents, beating the Zacks Consensus Estimate by 7.7%. Revenues of $4.56 billion surpassed the Zacks Consensus Estimate by 3.5%. It currently sports a Zacks Rank #1.

Boston Scientific has a long-term estimated growth rate of 13.3%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.3%.

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