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IQVIA HOLDINGS INC. (IQV) Q3 2025 Earnings Summary

Executive Summary

  • Revenue of $4.10B (+5.2% YoY, +2.1% QoQ) and adjusted diluted EPS of $3.00; both modestly above consensus; record quarterly free cash flow ($772M) underscores disciplined working capital and improving backdrop .
  • R&DS bookings accelerated to $2.6B (book-to-bill 1.15x) and RFP flow rose 20% YoY, indicating healthier demand across large pharma and biotech; backlog reached $32.4B (+4.1% YoY) .
  • Full-year 2025 guidance narrowed with midpoints reaffirmed (Revenue: $16.15–$16.25B; Adj. EBITDA: $3.775–$3.800B; Adj. EPS: $11.85–$11.95); company introduced Q4 guidance (Revenue: $4.204–$4.304B; Adj. EBITDA: $1.033–$1.058B; Adj. EPS: $3.35–$3.45) .
  • Potential stock reaction catalysts: sustained bookings/RFP momentum, record FCF, and normalization of large pharma cancellations; watch CSMS mix/FX headwinds on margins and timing of deferred “mega trials” resumption .

What Went Well and What Went Wrong

What Went Well

  • R&DS demand strengthened: net new bookings $2.6B (+13% YoY), book-to-bill 1.15x; backlog $32.4B (+4.1% YoY); RFP flow +20% YoY; improving decision timelines .
  • Record free cash flow: $772M (+35% YoY), with operating cash flow of $908M; FCF at 150% of adjusted net income, reflecting strong working capital discipline .
  • TASS delivered solid results despite tough comp; CSMS grew robustly (Revenue $209M, +16.1% YoY), aided by acquisition strategy targeting commercial outsourcing trend .
    • CEO: “R&DS continued to perform well… net bookings… 13 percent… TAS delivered solid results… RFP growth accelerating to 20 percent year-over-year” .

What Went Wrong

  • Margin headwinds from FX tailwinds (revenue benefit without profit) and mix (stronger CSMS with lower margins); adjusted EBITDA growth only +1.1% YoY .
  • “Mega trials” remain pushed out; no Q4 revenue burn contemplated; visibility remains limited on timing .
  • TAS growth moderated vs prior year’s tough comp; sequential upside small in a seasonally soft quarter; adjusted EPS growth mid-single digits .

Financial Results

MetricQ3 2024Q2 2025Q3 2025
Revenue ($USD Millions)$3,896 $4,017 $4,100
GAAP Diluted EPS ($)$1.55 $1.54 $1.93
Adjusted Diluted EPS ($)$2.84 $2.81 $3.00
Adjusted EBITDA ($USD Millions)$939 $910 $949
Free Cash Flow ($USD Millions)$571 $292 $772

Segment Breakdown – Q3 2025

SegmentRevenue ($USD Millions)Reported YoY Growth (%)Constant Currency YoY Growth (%)
Technology & Analytics Solutions (TAS)$1,631 5.0% 3.3%
Research & Development Solutions (R&DS)$2,260 4.5% 3.4%
Contract Sales & Medical Solutions (CSMS)$209 16.1% 13.9%

KPIs and Bookings

KPIQ1 2025Q2 2025Q3 2025
R&DS Net New Bookings ($USD Billions)$2.1 $2.5 $2.6
Book-to-Bill (x)1.02x (quarter); TTM 1.14x 1.12x (quarter); TTM 1.10x 1.15x (quarter); TTM 1.12x
Contracted Backlog ($USD Billions)$31.5 $32.1 $32.4
Next-12-Month Revenue from Backlog ($USD Billions)$7.9 $8.1 $8.1

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue ($USD Billions)FY 2025$16.10–$16.30 $16.15–$16.25 Narrowed; midpoint reaffirmed
Adjusted EBITDA ($USD Billions)FY 2025$3.750–$3.825 $3.775–$3.800 Narrowed; raised low end
Adjusted Diluted EPS ($)FY 2025$11.75–$12.05 $11.85–$11.95 Narrowed around midpoint
Revenue ($USD Billions)Q4 2025n/a$4.204–$4.304 New quarterly guidance
Adjusted EBITDA ($USD Billions)Q4 2025n/a$1.033–$1.058 New quarterly guidance
Adjusted Diluted EPS ($)Q4 2025n/a$3.35–$3.45 New quarterly guidance

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2)Current Period (Q3 2025)Trend
Clinical demand: RFP flow and bookingsDelayed decisions, but pipeline/RFP grew; TAS strong . Q2: bookings +15% QoQ; RFP high-single-digit seq, low-teens YoY .Bookings $2.6B (+13% YoY), B2B 1.15x; RFP +20% YoY; improved decision timelines .Improving (RFP +20%; bookings +13%)
Pricing strategy (“see more, win more”)—Discounts earlier in year small portion of backlog; pricing “returned to normal levels” .Normalizing pricing; limited P&L impact
Large pharma reprioritization/cancellationsSector uncertainty elevated; forward indicators grew .2024 cancellations >$3B due reprioritizations; now back to normal (~$550M/qtr) .Normalized cancellations
TAS performance and AI initiativesTAS +7.6% CFX; above target . Q2 TAS +6.8% CFX .Solid despite tough comp; ~90 AI agents in dev across 25 use cases; target ~500 by early 2027 .AI adoption accelerating
CSMS growth/mixQ1 CSMS -4.2% YoY . Q2 CSMS +9.3% YoY .CSMS +16.1% YoY; mix is lower margin, modest headwind .Mix headwind persists
Mega trials timing—Both trials pushed out; no Q4 burn in guidance .Deferred
Phase 1 expansion and Next Oncology—Acquired Next Oncology (SMO) ~end Q3; phase 1 oncology capability expanding; ~$50M revenue expected in Q4 from inorganic .Expanding early-phase footprint
Margins and FX—FX tailwind benefits revenue but not profit; CSMS mix lowers margins near-term; AI/efficiency to help LT .Near-term headwinds; LT efficiency opportunity

Management Commentary

  • “IQVIA delivered a strong quarter with revenue and profit towards the high-end of our guide, and record free cash flow generation… RFP growth accelerating to 20 percent year-over-year” — Ari Bousbib, CEO .
  • “Our third quarter revenue of $4.1 billion grew 5.2%… Adjusted EBITDA… $949 million… GAAP diluted EPS was $1.93… adjusted diluted EPS was an even $3” — CFO Remarks .
  • “We’re progressing as planned to deploy highly specialized industry AI agents… ~90 agents in development covering 25 use cases… by early 2027, plan to develop 500” — CEO .

Q&A Highlights

  • Pricing normalization: earlier-year discounts aligned with market but small portion of backlog; sector healthier and pricing “returned to normal levels” .
  • Demand trajectory: management would be “surprised” if 2026 revenue growth is not at least equal or better than 2025, while formal guidance will come with Q4 results .
  • Large pharma vs biotech: large pharma reprioritizations essentially complete; cancellations back to normal ranges; biotech funding improving (e.g., $18B in Q3 per Bioworld cited on call) aiding bookings .
  • TAS outlook: segment CFX growth unchanged at 5–6% for the year; street may need to calibrate quarterly expectations; full-year delivery intact .
  • Mega trials: both pushed outside 2025; none contemplated in Q4 guide; backlog and bookings momentum offset absence .

Estimates Context

MetricQ3 2025 ConsensusQ3 2025 ActualSurprise
Revenue ($USD Millions)4,076.7*4,100 +$23.3M
Primary EPS ($)2.976*3.00 +$0.02
EBITDA ($USD Millions)946.5*949 (Adjusted EBITDA) +$2.5M vs adj. EBITDA; note metric definitions differ

Values retrieved from S&P Global.*
Note: S&P “EBITDA” may not align with IQVIA’s “Adjusted EBITDA”; we compare to adj. EBITDA for apples-to-apples with company-reported profitability .

Key Takeaways for Investors

  • Demand inflection confirmed: bookings/RFP acceleration and backlog growth support sustained revenue trajectory into Q4 and FY25; watch conversion pace of NTM backlog ($8.1B) .
  • Quality of cash flow: record FCF ($772M) improves deleveraging capacity (net leverage 3.52x) and buyback flexibility; cash $1.814B .
  • Guidance credibility: narrowed FY25 ranges with midpoints reaffirmed; introduced Q4 guidance consistent with momentum; monitor segment mix and FX effects on margins .
  • Mix/headwind dynamics: CSMS growth is positive but lower margin; near-term margin headwinds from FX/mix offset by ongoing cost programs and AI-driven efficiencies .
  • Strategic positioning: expanding early-phase oncology via Next Oncology; strengthening commercial outsourcing capabilities to capture large, multi-year engagements .
  • Risk watch: timing for “mega trials” resumption remains uncertain; no contribution in Q4 guidance; sector normalization mitigates impact .
  • Actionable: Expect estimate revisions reflecting bookings/RFP momentum and FCF strength; potential positive re-rating if margin headwinds abate and AI efficiencies materialize .

Appendix: Additional Data Points

  • Financial position: Cash $1,814M; Debt $14,957M; Net debt $13,143M; Net leverage 3.52x (LTM adjusted EBITDA $3,738M) .
  • Year-to-date 2025: Revenue $11,946M (+4.4% reported); Adj. EBITDA $2,742M; GAAP diluted EPS $4.86; Adj. diluted EPS $8.50 .

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