Thermo Fisher Scientific Reports Second Quarter 2024 Results
Thermo Fisher Scientific (NYSE: TMO) reported its Q2 2024 financial results, with revenue slightly declining 1% to $10.54 billion. Despite this, the company saw improvements in profitability, with GAAP diluted EPS increasing 15% to $4.04 and adjusted EPS rising 4% to $5.37. The company's GAAP operating margin expanded to 17.3% from 14.8% in Q2 2023.
Thermo Fisher launched several innovative products during the quarter, including new mass spectrometers and sustainable bioprocessing solutions. The company also expanded its clinical trial supply services and completed the acquisition of Olink, enhancing its protein research capabilities. Based on strong performance, Thermo Fisher raised its full-year 2024 guidance, projecting revenue between $42.4 to $43.3 billion and adjusted EPS of $21.29 to $22.07.
Thermo Fisher Scientific (NYSE: TMO) ha riportato i risultati finanziari del Q2 2024, con un fatturato leggermente in calo del 1% a $10,54 miliardi. Nonostante ciò, l'azienda ha registrato miglioramenti nella redditività, con l'EPS diluito GAAP in aumento del 15% a $4,04 e l'EPS rettificato in crescita del 4% a $5,37. Il margine operativo GAAP dell'azienda è aumentato al 17,3% rispetto al 14,8% nel Q2 2023.
Thermo Fisher ha lanciato diversi prodotti innovativi durante il trimestre, inclusi nuovi spettrometri di massa e soluzioni sostenibili per i bioprocessi. L'azienda ha anche ampliato i servizi di fornitura per studi clinici e ha completato l'acquisizione di Olink, potenziando le sue capacità di ricerca sulle proteine. Sulla base di una performance solida, Thermo Fisher ha alzato le previsioni per l'intero anno 2024, prevedendo un fatturato tra $42,4 e $43,3 miliardi e un EPS rettificato tra $21,29 e $22,07.
Thermo Fisher Scientific (NYSE: TMO) reportó sus resultados financieros del segundo trimestre de 2024, con una leve disminución del 1% en los ingresos a $10.54 mil millones. A pesar de esto, la empresa vio mejoras en la rentabilidad, con el EPS diluido GAAP aumentando un 15% a $4.04 y el EPS ajustado subiendo un 4% a $5.37. El margen operativo GAAP de la compañía se expandió al 17.3% desde el 14.8% en el segundo trimestre de 2023.
Thermo Fisher lanzó varios productos innovadores durante el trimestre, incluidos nuevos espectrómetros de masas y soluciones sostenibles para bioprocesamiento. La compañía también amplió sus servicios de suministro para ensayos clínicos y completó la adquisición de Olink, mejorando sus capacidades de investigación en proteínas. Basado en un sólido desempeño, Thermo Fisher aumentó su guía para todo el año 2024, proyectando ingresos entre $42.4 y $43.3 mil millones y un EPS ajustado de $21.29 a $22.07.
Thermo Fisher Scientific (NYSE: TMO)는 2024년 2분기 재무 결과를 발표하였으며, 매출은 1% 감소한 $105.4억 달러를 기록했습니다. 그럼에도 불구하고, 회사는 수익성 측면에서 개선을 보였으며 GAAP 희석 EPS가 15% 증가한 $4.04 및 조정 EPS가 4% 증가한 $5.37를 기록했습니다. 회사의 GAAP 운영 마진은 2023년 2분기 14.8%에서 17.3%로 확대되었습니다.
Thermo Fisher는 분기 동안 새로운 질량 분광기와 지속 가능한 바이오 프로세싱 솔루션을 포함한 여러 혁신적인 제품을 출시했습니다. 회사는 또한 임상 시험 공급 서비스 범위를 확대하고 Olink의 인수를 완료하여 단백질 연구 능력을 강화했습니다. 높은 성과를 바탕으로 Thermo Fisher는 2024년 전체 연도 가이던스를 상향 조정했습니다, 매출을 $424억에서 $433억 달러 사이로, 조정 EPS를 $21.29에서 $22.07 사이로 예상하고 있습니다.
Thermo Fisher Scientific (NYSE: TMO) a rapporté ses résultats financiers du deuxième trimestre 2024, avec un chiffre d'affaires en légère baisse de 1% à 10,54 milliards de dollars. Malgré cela, l'entreprise a connu des améliorations de rentabilité, avec le BPA dilué GAAP en hausse de 15% à 4,04 dollars et le BPA ajusté en hausse de 4% à 5,37 dollars. La marge opérationnelle GAAP de l'entreprise est passée à 17,3% contre 14,8% au T2 2023.
Thermo Fisher a lancé plusieurs produits innovants au cours du trimestre, y compris de nouveaux spectromètres de masse et des solutions de bioprocédés durables. L'entreprise a également élargi ses services de fournitures pour les essais cliniques et a finalisé l'acquisition d'Olink, renforçant ainsi ses capacités de recherche sur les protéines. Sur la base de cette performance solide, Thermo Fisher a relevé ses prévisions pour l'année entière 2024, prévoyant un chiffre d'affaires compris entre 42,4 et 43,3 milliards de dollars et un BPA ajusté de 21,29 à 22,07 dollars.
Thermo Fisher Scientific (NYSE: TMO) hat seine finanziellen Ergebnisse für das 2. Quartal 2024 veröffentlicht, mit einem geringfügigen Rückgang des Umsatzes um 1% auf $10,54 Milliarden. Trotz dieser Tatsache konnte das Unternehmen Verbesserungen bei der Rentabilität verzeichnen, mit einem Anstieg des GAAP verwässerten EPS um 15% auf $4,04 und einem Anstieg des bereinigten EPS um 4% auf $5,37. Die GAAP-Betriebs-Marge des Unternehmens stieg von 14,8% im 2. Quartal 2023 auf 17,3%.
Thermo Fisher hat im Laufe des Quartals mehrere innovative Produkte auf den Markt gebracht, darunter neue Massenspektrometer und nachhaltige Bioprozesslösungen. Das Unternehmen hat auch seine Dienstleistungen für klinische Studien erweitert und die Akquisition von Olink abgeschlossen, um seine Forschungsfähigkeiten im Bereich Proteine zu verbessern. Aufgrund der starken Leistung hat Thermo Fisher seine Gesamtjahresprognose für 2024 angehoben, mit einem Umsatz von 42,4 bis 43,3 Milliarden Dollar und einem bereinigten EPS von 21,29 bis 22,07 Dollar.
- GAAP diluted EPS increased 15% to $4.04
- Adjusted EPS rose 4% to $5.37
- GAAP operating margin expanded to 17.3% from 14.8% in Q2 2023
- Launched innovative new products, including mass spectrometers and sustainable bioprocessing solutions
- Completed acquisition of Olink, enhancing protein research capabilities
- Raised full-year 2024 guidance for revenue and adjusted EPS
- Revenue declined 1% to $10.54 billion
- Organic revenue decreased 1%
- Core organic revenue growth was flat
Insights
Thermo Fisher Scientific's financials from Q2 2024 reveal a mixed but interesting picture for investors. The company’s revenue slightly declined by
Investors should note the mixed signals: the overall revenue decline and flat core organic revenue growth could be a concern, particularly in a competitive market. However, Thermo Fisher’s ability to increase EPS and operating margins shows the company is capitalizing on cost efficiencies and strategic initiatives. The slight raise in the full-year revenue guidance (new range:
Thermo Fisher’s advancements in their product lines, particularly in mass spectrometry, are noteworthy. The launch of the Thermo Scientific ™ Stellar™ mass spectrometer and new editions of the Thermo Scientific Orbitrap Ascend Tribrid™ mass spectrometer for specific applications like MultiOmics, Structural Biology and BioPharma, indicate a strong emphasis on innovation. These products could significantly enhance their competitive edge by offering more precise and tailored solutions for scientific research.
The development of plant-based bioprocessing containers and ENERGY STAR-certified freezers aligns with industry trends toward sustainability and energy efficiency. These initiatives might strengthen Thermo Fisher’s market position and appeal to customers prioritizing sustainable solutions.
Thermo Fisher’s strategic moves, such as the expansion of clinical trial supply services and new facilities in the Netherlands and Pennsylvania, indicate a clear effort to bolster their operational capabilities and global reach. This can support faster drug development and innovation in biotechnology, making them a more reliable partner in the industry.
The completion of the Olink acquisition is also a major strategic step, enhancing their capabilities in proteomic research. This acquisition could provide avenues for new revenue streams and reinforce their leadership in precision medicine.
However, investors should consider the stagnant core organic revenue growth and the minimal increase in full-year financial guidance. These factors might imply limited short-term growth potential despite the company's strategic advancements.
Second Quarter 2024 Highlights
-
Second quarter revenue was
$10.54 billion -
Second quarter GAAP diluted earnings per share (EPS) increased
15% to$4.04 -
Second quarter adjusted EPS increased
4% to$5.37
-
Advanced our proven growth strategy, launching a range of high-impact, innovative new products during the quarter. This included a number of analytical instruments introduced at the American Society for Mass Spectrometry conference, including the Thermo Scientific™ Stellar™ mass spectrometer, which validates proteins of clinical interest discovered through our groundbreaking Thermo Scientific Orbitrap™ Astral™ mass spectrometer; and three new built-for-purpose editions of the Thermo Scientific Orbitrap Ascend Tribrid™ mass spectrometer tailored to MultiOmics, Structural Biology and BioPharma applications. To help our customers meet their sustainability goals, we also launched: a first-of-its-kind biobased film for our bioprocessing containers, which uses plant-based materials to deliver lower-carbon solutions in the manufacturing of therapies; and a new line of ENERGY STAR-certified Thermo Scientific™ TSX™ Universal Series ULT Freezers, which deliver industry-leading performance and energy efficiency.
-
Continued to strengthen our industry-leading commercial engine and deepen our trusted partner status with customers to accelerate their innovation and enhance their productivity. In the quarter, we expanded our leading clinical trial supply services with a new ultra-cold facility in Bleiswijk,
the Netherlands and a new state-of-the-art innovation lab at our site inCenter Valley, Pennsylvania , to enable our pharmaceutical and biotech customers to accelerate the development of therapies and medicines. Also in the quarter, to support Indonesia’s growing investments in healthcare, scientific research, and renewable energy, we expanded our presence and capabilities in the country, further demonstrating our relevance to customers around the world.
- Shortly after the quarter ended, we completed our acquisition of Olink, a provider of differentiated next-generation proteomic solutions. The addition of Olink’s technology extends our capabilities and further advances our leadership position in protein research, enabling our customers to meaningfully accelerate discovery and scientific breakthroughs while delivering on the promise of precision medicine.
“Our excellent execution enabled us to deliver another quarter of strong financial performance and share gain,” said Marc N. Casper, chairman, president, and chief executive officer of Thermo Fisher Scientific. “We continue to see the benefit of our proven growth strategy and the impact of our PPI Business System in our performance. Shortly after the quarter ended, we were also pleased to welcome our Olink colleagues to Thermo Fisher and are excited about the power of this new combination to better serve our customers and advance science.”
Casper added, “We have made very good progress through the halfway point of the year and are in a great position to deliver differentiated performance in 2024. We’ve further extended our industry leadership and positioned our company for an even brighter future.”
Second Quarter 2024
Revenue for the quarter declined
GAAP Earnings Results
GAAP diluted EPS in the second quarter of 2024 increased
Non-GAAP Earnings Results
Adjusted EPS in the second quarter of 2024 increased
Annual Guidance for 2024
Thermo Fisher is raising its full-year revenue and adjusted EPS guidance. The company is raising its revenue guidance to a new range of
Use of Non-GAAP Financial Measures
Adjusted EPS, adjusted net income, adjusted operating income, adjusted operating margin, free cash flow, organic revenue growth and Core organic revenue growth are non-GAAP measures that exclude certain items detailed after the tables that accompany this press release, under the heading “Supplemental Information Regarding Non-GAAP Financial Measures.” The reconciliations of GAAP to non-GAAP financial measures are provided in the tables that accompany this press release.
Note on Presentation
Certain amounts and percentages reported within this press release are presented and calculated based on underlying unrounded amounts. As a result, the sum of components may not equal corresponding totals due to rounding.
Conference Call
Thermo Fisher Scientific will hold its earnings conference call today, July 24, at 8:30 a.m. Eastern Daylight Time. During the call, the company will discuss its financial performance, as well as future expectations. To listen, call (833) 470-1428 within the
About Thermo Fisher Scientific
Thermo Fisher Scientific Inc. is the world leader in serving science, with annual revenue over
Safe Harbor Statement
The following constitutes a “Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward-looking statements that involve a number of risks and uncertainties. Important factors that could cause actual results to differ materially from those indicated by forward-looking statements include risks and uncertainties relating to: the COVID-19 pandemic; the need to develop new products and adapt to significant technological change; implementation of strategies for improving growth; general economic conditions and related uncertainties; dependence on customers' capital spending policies and government funding policies; the effect of economic and political conditions and exchange rate fluctuations on international operations; use and protection of intellectual property; the effect of changes in governmental regulations; any natural disaster, public health crisis or other catastrophic event; and the effect of laws and regulations governing government contracts, as well as the possibility that expected benefits related to recent or pending acquisitions, may not materialize as expected. Additional important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are set forth in our most recent annual report on Form 10-K, and subsequent quarterly report on Form 10-Q, which are on file with the SEC and available in the “Investors” section of our website under the heading “SEC Filings.” While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, even if estimates change and, therefore, you should not rely on these forward-looking statements as representing our views as of any date subsequent to today.
Condensed Consolidated Statements of Income (unaudited) |
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Three months ended |
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|
June 29, |
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% of |
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July 1, |
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% of |
||||||
(Dollars in millions except per share amounts) |
|
2024 |
|
Revenues |
|
2023 |
|
Revenues |
||||||
Revenues |
|
$ |
10,541 |
|
|
|
|
$ |
10,687 |
|
|
|
||
Costs and operating expenses: |
|
|
|
|
|
|
|
|
||||||
Cost of revenues (a) |
|
|
6,106 |
|
|
57.9 |
% |
|
|
6,323 |
|
|
59.2 |
% |
Selling, general and administrative expenses (b) |
|
|
1,687 |
|
|
16.0 |
% |
|
|
1,673 |
|
|
15.7 |
% |
Amortization of acquisition-related intangible assets |
|
|
513 |
|
|
4.9 |
% |
|
|
585 |
|
|
5.4 |
% |
Research and development expenses |
|
|
339 |
|
|
3.2 |
% |
|
|
345 |
|
|
3.2 |
% |
Restructuring and other costs (c) |
|
|
77 |
|
|
0.7 |
% |
|
|
183 |
|
|
1.7 |
% |
Total costs and operating expenses |
|
|
8,722 |
|
|
82.7 |
% |
|
|
9,109 |
|
|
85.2 |
% |
Operating income |
|
|
1,820 |
|
|
17.3 |
% |
|
|
1,578 |
|
|
14.8 |
% |
Interest income |
|
|
295 |
|
|
|
|
|
178 |
|
|
|
||
Interest expense |
|
|
(354 |
) |
|
|
|
|
(326 |
) |
|
|
||
Other income/(expense) (d) |
|
|
5 |
|
|
|
|
|
— |
|
|
|
||
Income before income taxes |
|
|
1,765 |
|
|
|
|
|
1,430 |
|
|
|
||
Provision for income taxes (e) |
|
|
(128 |
) |
|
|
|
|
(52 |
) |
|
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||
Equity in earnings/(losses) of unconsolidated entities |
|
|
(84 |
) |
|
|
|
|
(16 |
) |
|
|
||
Net income |
|
|
1,553 |
|
|
|
|
|
1,362 |
|
|
|
||
Less: net income/(losses) attributable to noncontrolling interests and redeemable noncontrolling interest |
|
|
6 |
|
|
|
|
|
1 |
|
|
|
||
Net income attributable to Thermo Fisher Scientific Inc. |
|
$ |
1,548 |
|
|
14.7 |
% |
|
$ |
1,361 |
|
|
12.7 |
% |
|
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|
|
|
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|
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Earnings per share attributable to Thermo Fisher Scientific Inc.: |
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Basic |
|
$ |
4.05 |
|
|
|
|
$ |
3.53 |
|
|
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||
Diluted |
|
$ |
4.04 |
|
|
|
|
$ |
3.51 |
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||
Weighted average shares: |
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|
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||||||
Basic |
|
|
382 |
|
|
|
|
|
386 |
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|
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||
Diluted |
|
|
383 |
|
|
|
|
|
388 |
|
|
|
||
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of adjusted operating income and adjusted operating margin |
|
|
|
|
|
|
|
|
||||||
GAAP operating income |
|
$ |
1,820 |
|
|
17.3 |
% |
|
$ |
1,578 |
|
|
14.8 |
% |
Cost of revenues adjustments (a) |
|
|
1 |
|
|
0.0 |
% |
|
|
18 |
|
|
0.2 |
% |
Selling, general and administrative expenses adjustments (b) |
|
|
(64 |
) |
|
-0.6 |
% |
|
|
6 |
|
|
0.1 |
% |
Restructuring and other costs (c) |
|
|
77 |
|
|
0.7 |
% |
|
|
183 |
|
|
1.7 |
% |
Amortization of acquisition-related intangible assets |
|
|
513 |
|
|
4.9 |
% |
|
|
585 |
|
|
5.4 |
% |
Adjusted operating income (non-GAAP measure) |
|
$ |
2,347 |
|
|
22.3 |
% |
|
$ |
2,370 |
|
|
22.2 |
% |
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of adjusted net income |
|
|
|
|
|
|
|
|
||||||
GAAP net income attributable to Thermo Fisher Scientific Inc. |
|
$ |
1,548 |
|
|
|
|
$ |
1,361 |
|
|
|
||
Cost of revenues adjustments (a) |
|
|
1 |
|
|
|
|
|
18 |
|
|
|
||
Selling, general and administrative expenses adjustments (b) |
|
|
(64 |
) |
|
|
|
|
6 |
|
|
|
||
Restructuring and other costs (c) |
|
|
77 |
|
|
|
|
|
183 |
|
|
|
||
Amortization of acquisition-related intangible assets |
|
|
513 |
|
|
|
|
|
585 |
|
|
|
||
Other income/expense adjustments (d) |
|
|
— |
|
|
|
|
|
(1 |
) |
|
|
||
Provision for income taxes adjustments (e) |
|
|
(102 |
) |
|
|
|
|
(171 |
) |
|
|
||
Equity in earnings/losses of unconsolidated entities |
|
|
84 |
|
|
|
|
|
16 |
|
|
|
||
Noncontrolling interests adjustments (f) |
|
|
(1 |
) |
|
|
|
|
— |
|
|
|
||
Adjusted net income (non-GAAP measure) |
|
$ |
2,057 |
|
|
|
|
$ |
1,997 |
|
|
|
||
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of adjusted earnings per share |
|
|
|
|
|
|
|
|
||||||
GAAP diluted EPS attributable to Thermo Fisher Scientific Inc. |
|
$ |
4.04 |
|
|
|
|
$ |
3.51 |
|
|
|
||
Cost of revenues adjustments (a) |
|
|
0.00 |
|
|
|
|
|
0.05 |
|
|
|
||
Selling, general and administrative expenses adjustments (b) |
|
|
(0.17 |
) |
|
|
|
|
0.01 |
|
|
|
||
Restructuring and other costs (c) |
|
|
0.20 |
|
|
|
|
|
0.47 |
|
|
|
||
Amortization of acquisition-related intangible assets |
|
|
1.34 |
|
|
|
|
|
1.51 |
|
|
|
||
Other income/expense adjustments (d) |
|
|
0.00 |
|
|
|
|
|
0.00 |
|
|
|
||
Provision for income taxes adjustments (e) |
|
|
(0.26 |
) |
|
|
|
|
(0.44 |
) |
|
|
||
Equity in earnings/losses of unconsolidated entities |
|
|
0.22 |
|
|
|
|
|
0.04 |
|
|
|
||
Noncontrolling interests adjustments (f) |
|
|
0.00 |
|
|
|
|
|
0.00 |
|
|
|
||
Adjusted EPS (non-GAAP measure) |
|
$ |
5.37 |
|
|
|
|
$ |
5.15 |
|
|
|
||
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of free cash flow |
|
|
|
|
|
|
|
|
||||||
GAAP net cash provided by operating activities |
|
$ |
1,960 |
|
|
|
|
$ |
1,540 |
|
|
|
||
Purchases of property, plant and equipment |
|
|
(301 |
) |
|
|
|
|
(284 |
) |
|
|
||
Proceeds from sale of property, plant and equipment |
|
|
15 |
|
|
|
|
|
4 |
|
|
|
||
Free cash flow (non-GAAP measure) |
|
$ |
1,674 |
|
|
|
|
$ |
1,260 |
|
|
|
||
| Business Segment Information |
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Three months ended |
||||||||||||
|
|
June 29, |
|
% of |
|
July 1, |
|
% of |
||||||
(Dollars in millions) |
|
2024 |
|
Revenues |
|
2023 |
|
Revenues |
||||||
|
|
|
|
|
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|
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|
||||||
Revenues |
|
|
|
|
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||||||
Life Sciences Solutions |
|
$ |
2,355 |
|
|
22.3 |
% |
|
$ |
2,463 |
|
|
23.0 |
% |
Analytical Instruments |
|
|
1,782 |
|
|
16.9 |
% |
|
|
1,749 |
|
|
16.4 |
% |
Specialty Diagnostics |
|
|
1,117 |
|
|
10.6 |
% |
|
|
1,109 |
|
|
10.4 |
% |
Laboratory Products and Biopharma Services |
|
|
5,758 |
|
|
54.6 |
% |
|
|
5,831 |
|
|
54.6 |
% |
Eliminations |
|
|
(470 |
) |
|
-4.5 |
% |
|
|
(465 |
) |
|
-4.4 |
% |
Consolidated revenues |
|
$ |
10,541 |
|
|
100.0 |
% |
|
$ |
10,687 |
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
||||||
Segment income and segment income margin |
|
|
|
|
|
|
|
|
||||||
Life Sciences Solutions |
|
$ |
865 |
|
|
36.7 |
% |
|
$ |
817 |
|
|
33.2 |
% |
Analytical Instruments |
|
|
439 |
|
|
24.6 |
% |
|
|
432 |
|
|
24.7 |
% |
Specialty Diagnostics |
|
|
299 |
|
|
26.7 |
% |
|
|
297 |
|
|
26.7 |
% |
Laboratory Products and Biopharma Services |
|
|
745 |
|
|
12.9 |
% |
|
|
824 |
|
|
14.1 |
% |
Subtotal reportable segments |
|
|
2,347 |
|
|
22.3 |
% |
|
|
2,370 |
|
|
22.2 |
% |
Cost of revenues adjustments (a) |
|
|
(1 |
) |
|
0.0 |
% |
|
|
(18 |
) |
|
-0.2 |
% |
Selling, general and administrative expenses adjustments (b) |
|
|
64 |
|
|
0.6 |
% |
|
|
(6 |
) |
|
-0.1 |
% |
Restructuring and other costs (c) |
|
|
(77 |
) |
|
-0.7 |
% |
|
|
(183 |
) |
|
-1.7 |
% |
Amortization of acquisition-related intangible assets |
|
|
(513 |
) |
|
-4.9 |
% |
|
|
(585 |
) |
|
-5.4 |
% |
Consolidated GAAP operating income |
|
$ |
1,820 |
|
|
17.3 |
% |
|
$ |
1,578 |
|
|
14.8 |
% |
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
||||||
(a) Adjusted results in 2024 and 2023 exclude charges for inventory write-downs associated with large-scale abandonment of product lines. Adjusted results in 2023 exclude |
||||||||||||||
(b) Adjusted results in 2024 and 2023 exclude certain third-party expenses, principally transaction/integration costs related to recent acquisitions, and charges/credits for changes in estimates of contingent acquisition consideration. |
||||||||||||||
(c) Adjusted results in 2024 and 2023 exclude restructuring and other costs consisting principally of severance, impairments of long-lived assets, net charges for pre-acquisition litigation and other matters, and abandoned facility and other expenses of headcount reductions and real estate consolidations. Adjusted results in 2023 also exclude |
||||||||||||||
(d) Adjusted results in 2024 and 2023 exclude net gains/losses on investments. |
||||||||||||||
(e) Adjusted results in 2024 and 2023 exclude incremental tax impacts for the reconciling items between GAAP and adjusted net income, incremental tax impacts as a result of tax rate/law changes, and the tax impacts from audit settlements. |
||||||||||||||
(f) Adjusted results exclude the incremental impacts for the reconciling items between GAAP and adjusted net income attributable to noncontrolling interests. |
||||||||||||||
Note: |
||||||||||||||
Consolidated depreciation expense is |
||||||||||||||
| Organic and Core organic revenue growth |
|
Three months ended |
|
|
|
June 29, 2024 |
|
Revenue growth |
|
-1 % |
|
Acquisitions |
|
0 % |
|
Currency translation |
|
-1 % |
|
Organic revenue growth (non-GAAP measure) |
|
-1 % |
|
COVID-19 testing revenue |
|
-1 % |
|
Core organic revenue growth (non-GAAP measure) |
|
0 % |
|
|
|
|
|
Note: |
|
||
For more information related to non-GAAP financial measures, refer to the section titled “Supplemental Information Regarding Non-GAAP Financial Measures” of this release. |
|
||
Condensed Consolidated Statements of Income (unaudited) |
|
|
|
|
|
|
|
|
||||||
|
|
Six months ended |
||||||||||||
|
|
June 29, |
|
% of |
|
July 1, |
|
% of |
||||||
(Dollars in millions except per share amounts) |
|
2024 |
|
Revenues |
|
2023 |
|
Revenues |
||||||
Revenues |
|
$ |
20,886 |
|
|
|
|
$ |
21,397 |
|
|
|
||
Costs and operating expenses: |
|
|
|
|
|
|
|
|
||||||
Cost of revenues (a) |
|
|
12,146 |
|
|
58.2 |
% |
|
|
12,760 |
|
|
59.6 |
% |
Selling, general and administrative expenses (b) |
|
|
3,417 |
|
|
16.4 |
% |
|
|
3,319 |
|
|
15.5 |
% |
Amortization of acquisition-related intangible assets |
|
|
1,065 |
|
|
5.1 |
% |
|
|
1,191 |
|
|
5.5 |
% |
Research and development expenses |
|
|
670 |
|
|
3.2 |
% |
|
|
691 |
|
|
3.2 |
% |
Restructuring and other costs (c) |
|
|
106 |
|
|
0.5 |
% |
|
|
295 |
|
|
1.4 |
% |
Total costs and operating expenses |
|
|
17,404 |
|
|
83.3 |
% |
|
|
18,256 |
|
|
85.3 |
% |
Operating income |
|
|
3,483 |
|
|
16.7 |
% |
|
|
3,141 |
|
|
14.7 |
% |
Interest income |
|
|
574 |
|
|
|
|
|
324 |
|
|
|
||
Interest expense |
|
|
(717 |
) |
|
|
|
|
(626 |
) |
|
|
||
Other income/(expense) (d) |
|
|
14 |
|
|
|
|
|
(46 |
) |
|
|
||
Income before income taxes |
|
|
3,354 |
|
|
|
|
|
2,793 |
|
|
|
||
Provision for income taxes (e) |
|
|
(408 |
) |
|
|
|
|
(98 |
) |
|
|
||
Equity in earnings/(losses) of unconsolidated entities |
|
|
(61 |
) |
|
|
|
|
(41 |
) |
|
|
||
Net income |
|
|
2,885 |
|
|
|
|
|
2,654 |
|
|
|
||
Less: net income/(losses) attributable to noncontrolling interests and redeemable noncontrolling interest |
|
|
9 |
|
|
|
|
|
4 |
|
|
|
||
Net income attributable to Thermo Fisher Scientific Inc. |
|
$ |
2,875 |
|
|
13.8 |
% |
|
$ |
2,650 |
|
|
12.4 |
% |
|
|
|
|
|
|
|
|
|
||||||
Earnings per share attributable to Thermo Fisher Scientific Inc.: |
|
|
|
|
|
|
|
|
||||||
Basic |
|
$ |
7.53 |
|
|
|
|
$ |
6.86 |
|
|
|
||
Diluted |
|
$ |
7.50 |
|
|
|
|
$ |
6.83 |
|
|
|
||
Weighted average shares: |
|
|
|
|
|
|
|
|
||||||
Basic |
|
|
382 |
|
|
|
|
|
386 |
|
|
|
||
Diluted |
|
|
383 |
|
|
|
|
|
388 |
|
|
|
||
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of adjusted operating income and adjusted operating margin |
|
|
|
|
|
|
|
|
||||||
GAAP operating income |
|
$ |
3,483 |
|
|
16.7 |
% |
|
$ |
3,141 |
|
|
14.7 |
% |
Cost of revenues adjustments (a) |
|
|
17 |
|
|
0.1 |
% |
|
|
59 |
|
|
0.3 |
% |
Selling, general and administrative expenses adjustments (b) |
|
|
(45 |
) |
|
-0.2 |
% |
|
|
14 |
|
|
0.1 |
% |
Restructuring and other costs (c) |
|
|
106 |
|
|
0.5 |
% |
|
|
295 |
|
|
1.4 |
% |
Amortization of acquisition-related intangible assets |
|
|
1,065 |
|
|
5.1 |
% |
|
|
1,191 |
|
|
5.5 |
% |
Adjusted operating income (non-GAAP measure) |
|
$ |
4,625 |
|
|
22.1 |
% |
|
$ |
4,700 |
|
|
22.0 |
% |
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of adjusted net income |
|
|
|
|
|
|
|
|
||||||
GAAP net income attributable to Thermo Fisher Scientific Inc. |
|
$ |
2,875 |
|
|
|
|
$ |
2,650 |
|
|
|
||
Cost of revenues adjustments (a) |
|
|
17 |
|
|
|
|
|
59 |
|
|
|
||
Selling, general and administrative expenses adjustments (b) |
|
|
(45 |
) |
|
|
|
|
14 |
|
|
|
||
Restructuring and other costs (c) |
|
|
106 |
|
|
|
|
|
295 |
|
|
|
||
Amortization of acquisition-related intangible assets |
|
|
1,065 |
|
|
|
|
|
1,191 |
|
|
|
||
Other income/expense adjustments (d) |
|
|
(11 |
) |
|
|
|
|
45 |
|
|
|
||
Provision for income taxes adjustments (e) |
|
|
(51 |
) |
|
|
|
|
(342 |
) |
|
|
||
Equity in earnings/losses of unconsolidated entities |
|
|
61 |
|
|
|
|
|
41 |
|
|
|
||
Noncontrolling interests adjustments (f) |
|
|
(1 |
) |
|
|
|
|
— |
|
|
|
||
Adjusted net income (non-GAAP measure) |
|
$ |
4,016 |
|
|
|
|
$ |
3,953 |
|
|
|
||
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of adjusted earnings per share |
|
|
|
|
|
|
|
|
||||||
GAAP diluted EPS attributable to Thermo Fisher Scientific Inc. |
|
$ |
7.50 |
|
|
|
|
$ |
6.83 |
|
|
|
||
Cost of revenues adjustments (a) |
|
|
0.04 |
|
|
|
|
|
0.15 |
|
|
|
||
Selling, general and administrative expenses adjustments (b) |
|
|
(0.12 |
) |
|
|
|
|
0.03 |
|
|
|
||
Restructuring and other costs (c) |
|
|
0.28 |
|
|
|
|
|
0.76 |
|
|
|
||
Amortization of acquisition-related intangible assets |
|
|
2.78 |
|
|
|
|
|
3.07 |
|
|
|
||
Other income/expense adjustments (d) |
|
|
(0.03 |
) |
|
|
|
|
0.11 |
|
|
|
||
Provision for income taxes adjustments (e) |
|
|
(0.13 |
) |
|
|
|
|
(0.88 |
) |
|
|
||
Equity in earnings/losses of unconsolidated entities |
|
|
0.16 |
|
|
|
|
|
0.11 |
|
|
|
||
Noncontrolling interests adjustments (f) |
|
|
0.00 |
|
|
|
|
|
0.00 |
|
|
|
||
Adjusted EPS (non-GAAP measure) |
|
$ |
10.47 |
|
|
|
|
$ |
10.18 |
|
|
|
||
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of adjusted free cash flow |
|
|
|
|
|
|
|
|
||||||
GAAP net cash provided by operating activities |
|
$ |
3,211 |
|
|
|
|
$ |
2,269 |
|
|
|
||
Purchases of property, plant and equipment |
|
|
(648 |
) |
|
|
|
|
(742 |
) |
|
|
||
Proceeds from sale of property, plant and equipment |
|
|
20 |
|
|
|
|
|
10 |
|
|
|
||
Free cash flow (non-GAAP measure) |
|
$ |
2,583 |
|
|
|
|
$ |
1,537 |
|
|
|
||
Business Segment Information |
|
Six months ended |
||||||||||||
|
|
June 29, |
|
% of |
|
July 1, |
|
% of |
||||||
(Dollars in millions) |
|
2024 |
|
Revenues |
|
2023 |
|
Revenues |
||||||
|
|
|
|
|
|
|
|
|
||||||
Revenues |
|
|
|
|
|
|
|
|
||||||
Life Sciences Solutions |
|
$ |
4,640 |
|
|
22.2 |
% |
|
$ |
5,075 |
|
|
23.7 |
% |
Analytical Instruments |
|
|
3,469 |
|
|
16.6 |
% |
|
|
3,472 |
|
|
16.2 |
% |
Specialty Diagnostics |
|
|
2,227 |
|
|
10.7 |
% |
|
|
2,217 |
|
|
10.4 |
% |
Laboratory Products and Biopharma Services |
|
|
11,480 |
|
|
55.0 |
% |
|
|
11,594 |
|
|
54.2 |
% |
Eliminations |
|
|
(930 |
) |
|
-4.5 |
% |
|
|
(961 |
) |
|
-4.5 |
% |
Consolidated revenues |
|
$ |
20,886 |
|
|
100.0 |
% |
|
$ |
21,397 |
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
||||||
Segment income and segment income margin |
|
|
|
|
|
|
|
|
||||||
Life Sciences Solutions |
|
$ |
1,705 |
|
|
36.7 |
% |
|
$ |
1,653 |
|
|
32.6 |
% |
Analytical Instruments |
|
|
838 |
|
|
24.2 |
% |
|
|
853 |
|
|
24.6 |
% |
Specialty Diagnostics |
|
|
593 |
|
|
26.6 |
% |
|
|
577 |
|
|
26.0 |
% |
Laboratory Products and Biopharma Services |
|
|
1,489 |
|
|
13.0 |
% |
|
|
1,617 |
|
|
14.0 |
% |
Subtotal reportable segments |
|
|
4,625 |
|
|
22.1 |
% |
|
|
4,700 |
|
|
22.0 |
% |
Cost of revenues adjustments (a) |
|
|
(17 |
) |
|
-0.1 |
% |
|
|
(59 |
) |
|
-0.3 |
% |
Selling, general and administrative expenses adjustments (b) |
|
|
45 |
|
|
0.2 |
% |
|
|
(14 |
) |
|
-0.1 |
% |
Restructuring and other costs (c) |
|
|
(106 |
) |
|
-0.5 |
% |
|
|
(295 |
) |
|
-1.4 |
% |
Amortization of acquisition-related intangible assets |
|
|
(1,065 |
) |
|
-5.1 |
% |
|
|
(1,191 |
) |
|
-5.5 |
% |
Consolidated GAAP operating income |
|
$ |
3,483 |
|
|
16.7 |
% |
|
$ |
3,141 |
|
|
14.7 |
% |
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
||||||
(a) Adjusted results in 2024 and 2023 exclude charges for inventory write-downs associated with large-scale abandonment of product lines and accelerated depreciation on manufacturing assets to be abandoned due to facility consolidations. Adjusted results in 2023 exclude |
||||||||||||||
(b) Adjusted results in 2024 and 2023 exclude certain third-party expenses, principally transaction/integration costs related to recent acquisitions, and charges/credits for changes in estimates of contingent acquisition consideration. |
||||||||||||||
(c) Adjusted results in 2024 and 2023 exclude restructuring and other costs consisting principally of severance, impairments of long-lived assets, net charges for pre-acquisition litigation and other matters, and abandoned facility and other expenses of headcount reductions and real estate consolidations. Adjusted results in 2023 also exclude |
||||||||||||||
(d) Adjusted results in 2024 and 2023 exclude net gains/losses on investments. |
||||||||||||||
(e) Adjusted results in 2024 and 2023 exclude incremental tax impacts for the reconciling items between GAAP and adjusted net income, incremental tax impacts as a result of tax rate/law changes and the tax impacts from audit settlements. |
||||||||||||||
(f) Adjusted results exclude the incremental impacts for the reconciling items between GAAP and adjusted net income attributable to noncontrolling interests. |
||||||||||||||
|
|
|
|
|
|
|
|
|
||||||
Notes: |
||||||||||||||
Consolidated depreciation expense is |
||||||||||||||
For more information related to non-GAAP financial measures, refer to the section titled “Supplemental Information Regarding Non-GAAP Financial Measures” of this release. |
||||||||||||||
| Condensed Consolidated Balance Sheets (unaudited) |
|
|
|
|
||
|
|
|
|
|
||
|
|
June 29, |
|
December 31, |
||
(In millions) |
|
2024 |
|
2023 |
||
|
|
|
|
|
||
Assets |
|
|
|
|
||
Current assets: |
|
|
|
|
||
Cash and cash equivalents |
|
$ |
7,073 |
|
$ |
8,077 |
Short-term investments |
|
|
1,750 |
|
|
3 |
Accounts receivable, net |
|
|
7,943 |
|
|
8,221 |
Inventories |
|
|
5,198 |
|
|
5,088 |
Other current assets |
|
|
3,512 |
|
|
3,200 |
Total current assets |
|
|
25,476 |
|
|
24,589 |
Property, plant and equipment, net |
|
|
9,282 |
|
|
9,448 |
Acquisition-related intangible assets, net |
|
|
15,519 |
|
|
16,670 |
Other assets |
|
|
4,377 |
|
|
3,999 |
Goodwill |
|
|
43,843 |
|
|
44,020 |
Total assets |
|
$ |
98,496 |
|
$ |
98,726 |
|
|
|
|
|
||
Liabilities, redeemable noncontrolling interest and equity |
|
|
|
|
||
Current liabilities: |
|
|
|
|
||
Short-term obligations and current maturities of long-term obligations |
|
$ |
5,121 |
|
$ |
3,609 |
Other current liabilities |
|
|
9,651 |
|
|
10,403 |
Total current liabilities |
|
|
14,772 |
|
|
14,012 |
Other long-term liabilities |
|
|
5,907 |
|
|
6,564 |
Long-term obligations |
|
|
30,284 |
|
|
31,308 |
Redeemable noncontrolling interest |
|
|
115 |
|
|
118 |
Total equity |
|
|
47,419 |
|
|
46,724 |
Total liabilities, redeemable noncontrolling interest and equity |
|
$ |
98,496 |
|
$ |
98,726 |
Condensed Consolidated Statements of Cash Flows (unaudited) |
|
|
|
|
||||
|
|
|
|
|
||||
|
|
Six months ended |
||||||
|
|
June 29, |
|
July 1, |
||||
(In millions) |
|
2024 |
|
2023 |
||||
|
|
|
|
|
||||
Operating activities |
|
|
|
|
||||
Net income |
|
$ |
2,885 |
|
|
$ |
2,654 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
||||
Depreciation and amortization |
|
|
1,626 |
|
|
|
1,714 |
|
Change in deferred income taxes |
|
|
(607 |
) |
|
|
(328 |
) |
Other non-cash expenses, net |
|
|
311 |
|
|
|
480 |
|
Changes in assets and liabilities, excluding the effects of acquisitions |
|
|
(1,003 |
) |
|
|
(2,251 |
) |
Net cash provided by operating activities |
|
|
3,211 |
|
|
|
2,269 |
|
|
|
|
|
|
||||
Investing activities |
|
|
|
|
||||
Purchases of property, plant and equipment |
|
|
(648 |
) |
|
|
(742 |
) |
Proceeds from sale of property, plant and equipment |
|
|
20 |
|
|
|
10 |
|
Proceeds from cross-currency interest rate swap interest settlements |
|
|
111 |
|
|
|
35 |
|
Acquisitions, net of cash acquired |
|
|
— |
|
|
|
(2,751 |
) |
Purchases of investments |
|
|
(1,778 |
) |
|
|
(188 |
) |
Other investing activities, net |
|
|
12 |
|
|
|
51 |
|
Net cash used in investing activities |
|
|
(2,283 |
) |
|
|
(3,585 |
) |
|
|
|
|
|
||||
Financing activities |
|
|
|
|
||||
Net proceeds from issuance of debt |
|
|
1,204 |
|
|
|
— |
|
Repayment of debt |
|
|
— |
|
|
|
(1,000 |
) |
Net proceeds from issuance of commercial paper |
|
|
— |
|
|
|
1,620 |
|
Repayment of commercial paper |
|
|
— |
|
|
|
(1,441 |
) |
Purchases of company common stock |
|
|
(3,000 |
) |
|
|
(3,000 |
) |
Dividends paid |
|
|
(284 |
) |
|
|
(252 |
) |
Other financing activities, net |
|
|
145 |
|
|
|
24 |
|
Net cash used in financing activities |
|
|
(1,936 |
) |
|
|
(4,049 |
) |
|
|
|
|
|
||||
Exchange rate effect on cash |
|
|
7 |
|
|
|
(19 |
) |
Decrease in cash, cash equivalents and restricted cash |
|
|
(1,000 |
) |
|
|
(5,384 |
) |
Cash, cash equivalents and restricted cash at beginning of period |
|
|
8,097 |
|
|
|
8,537 |
|
Cash, cash equivalents and restricted cash at end of period |
|
$ |
7,097 |
|
|
$ |
3,153 |
|
|
|
|
|
|
||||
Free cash flow (non-GAAP measure) |
|
$ |
2,583 |
|
|
$ |
1,537 |
|
|
|
|
|
|
||||
Note: |
||||||||
For more information related to non-GAAP financial measures, refer to the section titled “Supplemental Information Regarding Non-GAAP Financial Measures” of this release. |
||||||||
Supplemental Information Regarding Non-GAAP Financial Measures
In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), we use certain non-GAAP financial measures such as organic revenue growth, which is reported revenue growth, excluding the impacts of acquisitions/divestitures and the effects of currency translation. We also report Core organic revenue growth, which is reported revenue growth, excluding the impacts of COVID-19 testing revenue, and excluding the impacts of acquisitions/divestitures and the effects of currency translation. We report these measures because Thermo Fisher management believes that in order to understand the company’s short-term and long-term financial trends, investors may wish to consider the impact of acquisitions/divestitures, foreign currency translation and/or COVID-19 testing on revenues. Thermo Fisher management uses these measures to forecast and evaluate the operational performance of the company as well as to compare revenues of current periods to prior periods.
We report adjusted operating income, adjusted operating margin, adjusted net income, and adjusted EPS. We believe that the use of these non-GAAP financial measures, in addition to GAAP financial measures, helps investors to gain a better understanding of our core operating results and future prospects, consistent with how management measures and forecasts the company’s core operating performance, especially when comparing such results to previous periods, forecasts, and to the performance of our competitors. Such measures are also used by management in their financial and operating decision-making and for compensation purposes. To calculate these measures we exclude, as applicable:
- Certain acquisition-related costs, including charges for the sale of inventories revalued at the date of acquisition, significant transaction/acquisition-related costs, including changes in estimates of contingent acquisition-related consideration, and other costs associated with obtaining short-term financing commitments for pending/recent acquisitions. We exclude these costs because we do not believe they are indicative of our normal operating costs.
- Costs/income associated with restructuring activities and large-scale abandonments of product lines, such as reducing overhead and consolidating facilities. We exclude these costs because we believe that the costs related to restructuring activities are not indicative of our normal operating costs.
- Equity in earnings/losses of unconsolidated entities; impairments of long-lived assets; and certain other gains and losses that are either isolated or cannot be expected to occur again with any predictability, including gains/losses on investments, the sale of businesses, product lines, and real estate, significant litigation-related matters, curtailments/settlements of pension plans, and the early retirement of debt. We exclude these items because they are outside of our normal operations and/or, in certain cases, are difficult to forecast accurately for future periods.
- The expense associated with the amortization of acquisition-related intangible assets because a significant portion of the purchase price for acquisitions may be allocated to intangible assets that have lives of up to 20 years. Exclusion of the amortization expense allows comparisons of operating results that are consistent over time for both our newly acquired and long-held businesses and with both acquisitive and non-acquisitive peer companies.
- The noncontrolling interest and tax impacts of the above items and the impact of significant tax audits or events (such as changes in deferred taxes from enacted tax rate/law changes), the latter of which we exclude because they are outside of our normal operations and difficult to forecast accurately for future periods.
We report free cash flow, which is operating cash flow excluding net capital expenditures, to provide a view of the continuing operations’ ability to generate cash for use in acquisitions and other investing and financing activities. The company also uses this measure as an indication of the strength of the company. Free cash flow is not a measure of cash available for discretionary expenditures since we have certain non-discretionary obligations such as debt service that are not deducted from the measure.
Thermo Fisher Scientific does not provide GAAP financial measures on a forward-looking basis because we are unable to predict with reasonable certainty and without unreasonable effort items such as the timing and amount of future restructuring actions and acquisition-related charges as well as gains or losses from sales of real estate and businesses, the early retirement of debt and the outcome of legal proceedings. The timing and amount of these items are uncertain and could be material to Thermo Fisher Scientific’s results computed in accordance with GAAP.
The non-GAAP financial measures of Thermo Fisher Scientific’s results of operations and cash flows included in this press release are not meant to be considered superior to or a substitute for Thermo Fisher Scientific’s results of operations prepared in accordance with GAAP. Reconciliations of such non-GAAP financial measures to the most directly comparable GAAP financial measures are set forth in the tables above.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240723465896/en/
Media Contact Information:
Sandy Pound
Thermo Fisher Scientific
Phone: 781-622-1223
E-mail: sandy.pound@thermofisher.com
Investor Contact Information:
Rafael Tejada
Thermo Fisher Scientific
Phone: 781-622-1356
E-mail: rafael.tejada@thermofisher.com
Source: Thermo Fisher Scientific Inc.
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