WESTBROOK, Maine - IDEXX Laboratories, Inc. (NASDAQ: IDXX), a leader in veterinary diagnostics and software, reported first-quarter earnings that surpassed analyst expectations, but a slight revenue shortfall and reduced guidance for the full year prompted a modest stock decline. The company's shares edged down by 1.98% as investors digested the mixed financial results and future expectations.
For the first quarter, IDEXX announced earnings per share (EPS) of $2.81, which was $0.11 higher than the analyst consensus of $2.70. However, revenue for the quarter was $964.09 million, slightly missing the consensus estimate of $966.41 million. The reported revenue represents a 7% increase on both a reported and organic basis compared to the same quarter last year, driven by solid growth in the Companion Animal Group (CAG) and Water segments.
Despite the strong EPS performance, the company's revenue miss and updated guidance for fiscal year 2024, which was below analyst expectations, appeared to be the primary drivers behind the stock's decline. IDEXX updated its full-year 2024 EPS guidance to a range of $10.82 to $11.20, with the midpoint falling below the consensus of $11.14. The company also adjusted its revenue outlook to $3.89-3.96 billion, compared to the consensus estimate of $3.98 billion.
President and Chief Executive Officer Jay Mazelsky commented on the quarter's performance, attributing the results to high execution levels and strong customer interest in IDEXX's innovative testing platforms and solutions. Mazelsky highlighted the company's ability to deliver better patient outcomes and business results through workflow optimization and staff productivity.
The company's CAG segment reported a 7% increase in revenue, supported by recurring revenue growth of the same percentage. The Water segment also showed robust performance with an 11% increase in revenue. However, the Livestock, Poultry, and Dairy (LPD) segment experienced a 3% decline in revenue due to reduced herd health screening levels in the Asia Pacific region.
IDEXX's gross profits increased by 9%, with a gross margin improvement of 120 basis points. However, operating margin contracted by 10 basis points, including a negative impact from a customer contract resolution payment in the first quarter of 2023.
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