Quest Diagnostics (DGX 0.76%), a leading provider of medical diagnostic services, released its first-quarter earnings Tuesday for the period ending March 31. It reported revenue of $2.37 billion, surpassing the $2.29 billion forecast by analysts and marking a 1.5% increase from the year-ago quarter. Adjusted diluted EPS was $2.04, exceeding expectations of $1.86 and consistent with the previous year's performance.
| Metric | Q1 2024 | Estimate | Q1 2023 | % Change (YOY) |
|---|---|---|---|---|
| Revenue | $2.37 billion | $2.29 billion | $2.33 billion | 1.5% |
| EPS | $2.04 | $1.86 | $2.04 | none |
| Net income | $194 million | N/A | $202 million | (3.9%) |
| Operating income | $300 million | N/A | $305 million | (1.7%) |
| Cash from operations | $154 million | N/A | $94 million | 64.8% |
| Capital expenditures | $104 million | N/A | $127 million | (18.2%) |
Quest Diagnostics business overview
Quest Diagnostics is a cornerstone in the healthcare industry, providing crucial diagnostic information services. It strives for operational efficiency, service quality, and innovation.
With an eye on strategic growth, Quest has been investing in artificial intelligence (AI) and acquisitions like Haystack Oncology in 2023, aiming for leadership in its field.
Quarter highlights
In its press release, Quest Diagnostics highlighted its Invigorate initiative, which is pushing forward with automation and artificial intelligence (AI) and plans to deliver 3% annual cost savings and productivity improvements.
It also noted that the quarter notched a 6% bump in revenue for its "base" (non-COVID) business. Base testing volume grew 3.3% in the quarter.
From a financial perspective, the cash flow from operations significantly increased by nearly 65%, signaling strong operational efficiency.
Looking ahead
Based on the quarter's achievements, Quest Diagnostics lifted its full-year revenue and adjusted earnings outlook, showing confidence.
| Metric | Updated Guidance | Previous Guidance |
|---|---|---|
| Net revenue | $9.40 billion to $9.48 billion | $9.35 billion to $9.45 billion |
| Adjusted diluted EPS | $8.72 to $8.97 | $8.60 to $8.90 |
2023's figures were revenue of $9.25 billion and adjusted diluted EPS of $8.71, both of which were down from the previous year.
Investors should watch the integration of strategic acquisitions and ongoing investments in AI and diagnostics for sustained competitive advantage.
