NEW YORK – Bio-Rad Laboratories reported Thursday that its first quarter revenues declined 4 percent year over year due to lower sales in its life science segment.
For the quarter ended March 31, Bio-Rad's reported revenues of $585.4 million compared to $610.8 million in the year-ago period. On average, analysts had estimated Q1 revenues of $573.2 million.
On a call with investors to discuss the results, Norman Schwartz, Bio-Rad's long-time CEO, said the firm continues to operate in a very dynamic environment.
"In all my years in this business, I've never experienced such a prolonged period of macroeconomic headwinds impacting the growth of our business, especially for life science," Schwartz said.
However, "We are still in the golden age of biology, and I continue to see a long runway ahead for life science research and for diagnostics, the two principal markets that we serve," he also said.
Net sales in the life science segment decreased 5 percent year over year to $228.6 million due to ongoing challenges in the academic research market. Bio-Rad's CFO Roop Lakkaraju said on the call that life science sales were approximately $242 million in the year-ago period.
The life science sales decline was offset by mid-teen growth in the firm's process chromatography business, Lakkaraju said. Excluding that business — which supplies specialty resins to support biopharma developers — life science revenues decreased approximately 8 percent year-over-year, he said, attributed to softness across the markets for instrument demand.
Clinical diagnostics net sales for the first quarter declined 3 percent year over year to $356.8 million on lowered reimbursement for diabetes testing in China offset by demand for the firm's quality control products, the Hercules, California-based company said.
On the call, Lakkaraju specified that prior-year Q1 sales in clinical diagnostics were approximately $369 million. The firm does not expect any further reimbursement changes in China, he also said.
Bio-Rad reported net income for the quarter of $64.0 million, or $2.29 per share, compared to net income of $383.9 million, or $13.45 per share, in the year-ago period. Adjusted EPS was $2.54, beating the analysts' average estimate of $1.78.
The firm's SG&A expenses fell approximately 3 percent to $208.8 million from $214.9 million, while its R&D spending increased 11 percent to $73.5 million from $66.4 million.
The decrease in SG&A was related to lower discretionary spending and lower employee-related costs, offset by restructuring costs, Lakkaraju said on the call, while the increase in R&D was due to restructuring costs partially offset by lower employee-related expenses related to Bio-Rad's recent 5 percent workforce reduction.
Bio-Rad ended the quarter with $521.4 million in cash and cash equivalents and $1.14 billion in short-term investments.
The firm also updated its full-year 2025 financial outlook to a range of approximately a 1.0 percent decline to 1.5 percent increase in revenue, compared to a prior expectation of 1.5 percent to 3.5 percent growth.
"We are updating our 2025 full year guide to reflect the Q1 results, the evolving state of academic and biotech research funding, and the impact of recent changes in the macro economy, including tariffs," Lakkaraju said on the call.
Specifically, as a result of changes to US policy regarding research funding, the firm now expects life sciences purchases, and especially demand for instruments, to be more muted in 2025.
"We are also seeing reduced demand from biotech customers, particularly among small and mid-sized development stage companies that have become more conservative with equipment spending due to the increased volatility in the capital markets," Lakkaraju also said.
By business unit, and also considering tariffs that are currently in effect, the firm anticipates life science revenues to be flat to down 3 percent for the full year and clinical diagnostics revenues to grow between 0.5 percent and 2.5 percent. On the call, company executives said they are contemplating pricing adjustments and surcharges to offset tariff expenses, although Schwartz noted that the firm is also considering the potential impacts these strategies may have on customer purchasing.
In Friday morning trading shares of Bio-Rad on the NYSE were flat at $240.40.