Q4 2024 Earnings Summary
- Revvity closed the year with better than peer growth and better margin expansion than others in the group, demonstrating strong operational performance.
- The company's Diagnostics business is performing at normal levels with around 6% growth, providing stability and resilience in this segment.
- Revvity is not seeing any pausing or slowing down of spending from pharma customers, suggesting steady demand and potential upside if market conditions stabilize.
- Revvity is experiencing uncertainty due to regulatory and geopolitical factors, leading the company to assume the current market environment continues throughout 2025 without significant improvement, which could limit growth prospects.
- The Life Sciences Instruments segment continues to lag and is not on a path to recovery, as CapEx spending remains soft, potentially impacting overall revenue growth.
- The company's plan to step up strategic investments in 2025 may result in operating margin expansion being below previous expectations, despite improving revenue growth, which could affect profitability.
| Metric | YoY Change | Reason |
|---|---|---|
Total Revenue | +4.8% (from $695.9M in Q4 2023 to $729.4M in Q4 2024) | Total Revenue grew by $33.5M (4.8%), reflecting overall improved performance across key segments and geographies. This growth builds on previous momentum where strategic initiatives and recovering market demand began offsetting past headwinds vs.. |
Life Sciences Revenue | +5.2% (from $319.6M in Q4 2023 to $336.3M in Q4 2024) | Life Sciences improved by $16.7M (5.2%), suggesting a favorable product mix and regional expansion that extended earlier gains. This increment indicates continued recovery or investment payoffs compared to the lower baseline in Q4 2023 vs.. |
Operating Income | +54% (from $77.16M in Q4 2023 to $118.75M in Q4 2024) | Operating Income surged by $41.59M (54% increase), driven by strong revenue performance combined with effective cost containment, enhanced pricing, and improved operational efficiencies. This dramatic improvement builds upon prior period initiatives that set the stage for better margin management vs.. |
EPS – Diluted | +20% (from $0.65 in Q4 2023 to $0.78 in Q4 2024) | EPS improved by approximately 20%, closely tied to the marked increase in operating income and disciplined expense management. The better profitability profile in Q4 2024 reflects the successful execution of operational improvements noted in earlier periods vs.. |
Americas Revenue | +5.7% (from $301.2M in Q4 2023 to $318.61M in Q4 2024) | Americas revenue grew by $17.41M (5.7%), potentially driven by a revival in the Diagnostics segment and steady regional market demand. This improvement continues a regional recovery trend compared to prior performance vs.. |
Asia Revenue | +5.5% (from $202.3M in Q4 2023 to $213.34M in Q4 2024) | Asia revenue increased by $11.04M (5.5%), with gains likely stemming from a rebound in reagent sales and stabilization in instrumentation orders, offsetting previous declines. This performance is consistent with earlier observations of flat to modest growth in Asia that turned positive vs.. |
| Metric | Period | Previous Guidance | Current Guidance | Change |
|---|---|---|---|---|
Organic Growth | FY 2025 | no prior guidance | 3% to 5% | no prior guidance |
Diagnostics Growth | FY 2025 | no prior guidance | Upper end of mid-single digits | no prior guidance |
Life Sciences Growth | FY 2025 | no prior guidance | Low single-digit range | no prior guidance |
China Growth | FY 2025 | no prior guidance | In line with 3% to 5% | no prior guidance |
Immunodiagnostics in China | FY 2025 | no prior guidance | Mid-single digits | no prior guidance |
Operating Margin Expansion | FY 2025 | no prior guidance | 20 to 40 basis points | no prior guidance |
Software Business Growth | FY 2025 | no prior guidance | Low double digits | no prior guidance |
| Metric | Period | Guidance | Actual | Performance |
|---|---|---|---|---|
Revenue | FY 2024 | $2.75B to $2.77B | $2.755B [calculated from Q1: 649.920 [34] + Q2: 691.685+ Q3: 684.049+ Q4: 729.372] | Met |
| Topic | Previous Mentions | Current Period | Trend |
|---|---|---|---|
Life Sciences instrumentation sales | Persistent declines from Q1 to Q3 2024, with some hopes for gradual normalization | Down high single digits in Q4 2024 and no near-term recovery assumed for 2025 | Recurring topic; consistently challenging |
Pharma and biotech spending environment | Subdued spending across Q1–Q3 2024, albeit with gradual improvement signs | Stabilizing but not fully normalized; company remains cautious for 2025 | Recurring topic; cautious optimism |
Diagnostics segment performance | Steady performance in Q1–Q3 2024, with immunodiagnostics leading growth | 4% reported growth in Q4 2024, immunodiagnostics and reproductive health performed well | Recurring topic; steady growth |
Software business growth | High single to mid-teens growth throughout Q1–Q3 2024, with lumpiness from renewals | Strong Q4 2024 showing; low double-digit annual growth driven by SaaS | Recurring topic; momentum sustained |
Reagents portfolio (including BioLegend) | Recovered from declines in Q1–Q2 2024; showed stable mid-single-digit growth in Q3 2024 | Mid-single-digit growth continues; innovation and share gains persisted in Q4 2024 | Recurring topic; improving outlook |
Margin expansion and operational efficiencies | Consistent margin gains Q1–Q3 2024 via cost controls and productivity initiatives | Expanded adjusted operating margins in 2024 by 30 bps; targeting 20–40 bps more in 2025 | Recurring topic; continued discipline |
Strategic investments and capital allocation (including share repurchases) | Robust buybacks in earlier quarters; prioritizing share repurchases over large M&A due to valuations | $185M repurchased in Q4 2024; stepping up digital and sales channel investments for 2025 | Recurring topic; staying aggressive on buybacks |
China market conditions and stimulus | Volatile Q1–Q3 2024 with instrument spending delays; expecting eventual lift from stimulus | Modest stimulus-driven orders in Q4 2024; cautious assumptions for 2025 | Recurring topic; remains uncertain |
Immunodiagnostics in the US (20% CAGR noted in Q1) | Mentioned 20% CAGR in Q1 2024 and strong ongoing menu expansion | Not referenced in Q4 2024 | Recurring topic; no new Q4 detail |
Prenatal and newborn screening | Consistent positive performance in Q1–Q3 2024, aided by cyclical factors like Year of the Dragon | High single-digit Q4 2024 growth; new partnerships in neonatal sequencing | Recurring topic; sustained growth |
Regulatory and geopolitical uncertainties | Limited mentions in earlier quarters; concerns mostly around China–US tensions | Highlighted as a key factor in cautious 2025 guidance | Recurring topic; more emphasis in Q4 |
Recurring revenue model strengths | 80% of revenue deemed recurring; cited as a resilience factor Q1–Q3 2024 | Strong SaaS ARR growth and stable net retention fueling performance | Recurring topic; continues to bolster results |
Site closures and consolidations | Q1–Q2 2024 disruptions from site closures; stabilized by Q3 | No mention in Q4 2024 | No current mention; prior challenge |
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Recovery in Key Markets Q: Which areas are back to normal, and which are lagging? A: Management states that Diagnostics is performing at normal levels, growing around 6% , and the Software business is experiencing low double-digit growth. Life Sciences Reagents are approaching normalcy with mid-single-digit growth , while Life Sciences Instruments remain below expectations due to delayed CapEx spending. They prudently assume the current environment will continue throughout 2025.
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China Growth Expectations Q: What is the guidance for China growth this year? A: The company expects China to grow in line with the overall company growth of 3% to 5%. Life Sciences in China is anticipated at the higher end of this range, while Diagnostics at the lower end. Modest stimulus impact is expected but is not material to the company.
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Reagents Growth and Market Share Q: Are you gaining market share in reagents, and what's the growth outlook? A: Reagents are performing well with mid-single-digit growth, outperforming peers. The company is gaining market share due to innovation. Reagents are expected to grow faster than the overall Life Sciences Solutions segment in 2025.
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Guidance Breakdown Q: How do segment outlooks compare, and what drives guidance range? A: Diagnostics is projected to grow above the company average, at the upper end of mid-single digits. Life Sciences is expected to grow in the low single-digit range. The guidance assumes no significant change in current market conditions and includes prudence due to regulatory and geopolitical uncertainties.
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Immunodiagnostics Outlook Q: What are the expectations for Immunodiagnostics growth? A: Immunodiagnostics is expected to grow at high single digits in 2025 , with China performing as anticipated. Growth outside the U.S. continues in the low to mid-teens, driven by innovation and expanding autoimmune business.
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First Quarter Guidance and Margins Q: Why is Q1 guidance below expectations, and how will margins develop? A: Q1 operating margins are traditionally below the full-year average due to seasonality. Margins are expected to improve throughout the year, with the fourth quarter being the strongest due to volume leverage. Organic growth and tax rate timing also impact Q1 earnings.
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Pharma/Biotech Customer Activity Q: Is pharma/biotech spending improving? A: There are signs of recovery in reagents sales to pharma/biotech customers, with two consecutive quarters of mid-single-digit growth. However, Life Sciences Instruments tied to CapEx spending are still not recovering fully.
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Applied Genomics Recovery Q: Is Applied Genomics showing signs of recovery? A: Applied Genomics is starting to recover after pressures from COVID-19 impacts. The business is being aligned under Life Sciences Solutions, and management is optimistic about its prospects in clinical and pharma/biotech segments.
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NIH Funding Impact Q: How will NIH funding challenges affect the business? A: The direct exposure to NIH is close to 1%, and indirect exposure is under 5%. Sales are mostly reagents and small-ticket items, so potential funding issues are not expected to have a material impact.
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Reproductive Health Growth Q: What's driving Reproductive Health performance? A: Reproductive Health saw high single-digit growth in Q4, driven by strong performance in Newborn Screening. For 2025, it's expected to grow in the low single digits, consistent with long-term plans.