SAN DIEGO - QuidelOrtho Corporation (NASDAQ:QDEL), a leader in diagnostic solutions, reported a significant drop in its fourth-quarter earnings per share (EPS) and revenue, missing analyst estimates.
The company's adjusted EPS was $1.17, falling short of the consensus estimate of $2.04. Revenue also declined, reaching $742.6 million against expectations of $796.91 million. Compared to the same period last year, revenue saw a decrease from $867 million, marking a YoY decline.
The company's financial performance was influenced by a substantial reduction in respiratory revenue, which plummeted by 49%, although non-respiratory revenue grew by 9%.
QuidelOrtho's full-year revenue was reported at $3.0 billion, a decrease from the previous year's $3.3 billion. The company's adjusted diluted EPS for the full year stood at $4.13, a significant drop from the supplemental combined adjusted diluted EPS of $13.80 in the prior year. The downturn is largely attributed to the expected decline in COVID-19 related revenue.
QuidelOrtho's stock price experienced a sharp 33% decline following the earnings release, indicating investor concerns primarily about the company's future outlook, which trailed analyst estimates.
Looking ahead, QuidelOrtho's fiscal year 2024 guidance anticipates total revenues between $2.76 and $3.07 billion, with non-respiratory revenue ranging from $2.30 to $2.34 billion and respiratory revenue between $460 and $730 million.
The company's adjusted EBITDA is projected to be between $565 and $720 million, with an adjusted EBITDA margin of 21% to 24%. The adjusted diluted EPS is forecasted to be between $2.40 and $3.07, all of which fall below analyst expectations.
Douglas Bryant, President and CEO of QuidelOrtho, remains optimistic about the company's trajectory, highlighting growth in non-respiratory business and market share gains in the respiratory portfolio.
"In our first full year operating as a combined company, we successfully laid the foundation for building a broader-based diagnostics company poised for future growth," said Bryant.
He also mentioned the company's strategic measures to mitigate the impact of macro factors and to support long-term growth and shareholder value.
Investors reacted negatively to the earnings miss and the cautious guidance, reflecting their concerns over the company's performance amidst a challenging environment for COVID-19 related products and broader economic pressures.
QuidelOrtho's focus on cost reduction and efficiency improvements will be critical as it navigates through these headwinds in the coming fiscal year.
InvestingPro Insights
QuidelOrtho Corporation (NASDAQ:QDEL) has been navigating a challenging market landscape, as reflected in its recent earnings report. According to InvestingPro data, QuidelOrtho's market capitalization stands at $4.46 billion, with a trailing twelve-month P/E ratio as of Q3 2023 of 40.59, signaling a high valuation relative to earnings. This is underscored by the InvestingPro Tip that the company is trading at a high earnings multiple.
The company's revenue for the last twelve months as of Q3 2023 was reported to be $3.12 billion, with a gross profit margin of 50.04%, indicating a strong ability to retain earnings after the cost of goods sold. Despite this, analysts have revised their earnings downwards for the upcoming period, and net income is expected to drop this year, as noted in another InvestingPro Tip.
However, it's not all challenging news for QuidelOrtho. The company has seen a strong return over the last three months, with a 19.08% price total return, which could be a signal of investor confidence in the company's long-term strategy. Additionally, analysts predict the company will be profitable this year, and it has been profitable over the last twelve months.
For investors looking for more insights, there are additional InvestingPro Tips available for QuidelOrtho at https://www.investing.com/pro/QDEL. And for those interested in a deeper dive into the company's financials, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, which includes access to a suite of tools and data to inform investment decisions.
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