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Updated: August 1, 2023

IDEXX beats estimates on Q2 results, raises full-year earnings outlook

IDEXX headquarters building exterior Photo / Tim Greenway IDEXX Laboratories Inc. (Nasdaq: IDXX) is a global veterinary diagnostic company based in Westbrook.

IDEXX Laboratories Inc. (Nasdaq: IDEXX) on Tuesday posted second-quarter earnings and revenue that beat expectations and raised its full-year financial outlook.

The Westbrook-based veterinary diagnostics company reported diluted earnings per share of $2.67, an increase of 71% as reported and 77% on a comparable basis. Earnings per share exceeded the $2.43 per share consensus estimate of analysts polled by Zacks Investment Research.

Over the last four quarters, the company has surpassed consensus earnings per share estimate four times.

The company attributed the earnings increase to a 54% growth benefit from research and development investments in the second quarter of 2022. Results also included 4 cents per share in tax benefits from share-based compensation, and a loss of 7 cents per share from currency changes.

Second-quarter revenue was $944 million, an increase of 10% reported and 10% organic and 1.7% higher than the Zacks consensus estimate. The increase was driven in part by domestic and international growth in the company's Companion Animal Group, reflecting solid demand for veterinary services and benefits.

Photo of Jay Mazelsky, IDEXX president and CEO
File photo
IDEXX President and CEO Jay Mazelsky

"Strong execution by IDEXX commercial and operational teams drove excellent growth results and financial performance in the second quarter," said Jay Mazelsky, the company's president and CEO. "Our customers' increasing embrace of IDEXX innovations, including cloud-based software services, helps them address the growing global demand for pet healthcare by improving efficiency while maintaining quality of care and supporting veterinary teams."

Veterinary software, services and diagnostic imaging systems revenues grew 12% as reported and 13% organically, supported by double-digit organic gains in recurring software and digital imaging revenues. Strong demand for cloud-based products continues to support momentum in software solution placements and customer gains, IDEXX said.

Updated guidance 

Buoyed by a strong quarter, IDEXX raised its full-year earnings per share outlook to a range of $9.64 to $9.90 per share, reflecting an increase of 31 cents per share at the low end and 15 cents per share at the high end.

Those changes incorporate positive refinements to the full-year operational outlook and benefits of 6 cents per share amid updated projections for interest expense, foreign exchange impacts and share- based compensation benefits.

The update includes an outlook for 21 cents per share of negative full-year impact from foreign exchange changes, primarily related to lapping 2022 hedge gains, an improvement of 2 cents per share over prior guidance.

IDEXX also tweaked Its full-year revenue growth outlook to a range of 8.5% to 10% as reported and organically, reflecting 1% increase at the low end and no changes for organic revenue growth at the high end.

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