This story has been updated with comments from Thermo Fisher Scientific's analyst conference call.
NEW YORK – Thermo Fisher Scientific reported before the opening of the market on Wednesday that its third quarter revenues rose 9 percent year over year, thanks to growth across three of its four business segments.
For the three months ended Oct. 2, the Waltham, Massachusetts-based company reported total revenues of $9.33 billion, up from $8.52 billion a year ago and beating the average Wall Street analyst estimate of $8.39 billion. Organic revenues grew 7 percent, while acquisitions increased revenue by 1 percent and currency translation increased revenue by 1 percent, Thermo Fisher said.
COVID-19 response revenue was $2.05 billion for the quarter.
Revenues from the life sciences solutions business unit rose 9 percent to $3.72 billion in Q3 2021 from $3.42 billion in Q3 2020, while revenues from the analytical instruments segment rose 11 percent to $1.48 billion from $1.34 billion in the year-ago quarter, and revenues from the laboratory products and services segment rose 12 percent to $3.49 billion from $3.11 billion. However, revenues from the specialty diagnostics segment fell nearly 5 percent to $1.36 billion from $1.43 billion in Q3 2020.
"Our incredibly strong performance in the third quarter demonstrates our proven growth strategy powered by our PPI Business System," Thermo Fisher Chairman, President, and CEO Marc Casper said in a statement. "We continue to deliver exceptional performance in revenue, earnings and free cash flow. And we are launching innovative new products and expanding our capabilities and capacity to enhance our customer value proposition."
On a conference call with analysts following the release of the earnings, Casper commented on the company's end markets, noting that the pharma and biotech end market saw growth of 20 percent during Q3, with broad-based strength in bioproduction, pharma services, chromatography and mass spectrometry. In the academic and government end market, the company saw mid-single digit growth, with "very good growth" in bioscience, he said. The industrial and applied end markets saw growth in the mid-teens, with particularly strong growth in the electron microscopy business.
The diagnostics and healthcare end market declined 11 percent. But performance in the base business was strong, Casper said, driven by immunodiagnostics, clinical diagnostics, and transplant diagnostics.
By geography, the company's revenues were flat in North America in Q3, rose 20 percent in Europe, rose in the low double digits in the Asia-Pacific region, rose in the low single digits in China, and fell in the high single digits in the rest of the world, said Thermo Fisher CFO Stephen Williamson.
Thermo Fisher's Q3 net income fell to $1.90 billion, or $4.79 per share, from $1.93 billion, or $4.84 per share, a year ago. On an adjusted basis, the company reported EPS of $5.76 per share for the quarter, beating the average Wall Street estimate of $4.67 per share.
The company's R&D costs rose 19 percent to $351.0 million from $296.0 million a year ago, while its SG&A expenses rose 32 percent to $1.73 billion from $1.30 billion.
Thermo Fisher ended the quarter with cash and cash equivalents of $12.02 billion.
For full-year 2021, the company raised its revenue guidance by $1.2 billion to $37.10 billion. This would result in 15 percent revenue growth over 2020. The firm also raised its adjusted EPS guidance by $1.30 to $23.37 for the year, which would represent 20 percent year-over-year growth.
On the call Casper said the company raised its guidance due to growth in its base business as well as continued strength in its response to the COVID-19 pandemic. The updated guidance now implies $1.05 billion of COVID-related revenues in the fourth quarter.
Analysts are expecting revenues of $36.09 billion and earnings per share of $22.19 for the year.
The firm's shares rose less than 1 percent to $613.59 in midday trading on the New York Stock Exchange.