Thermo Fisher Scientific Inc. (TMO) outpaced Wall Street’s expectations for quarterly profit and increased its annual profit forecast on Wednesday, citing improved demand for its products and services in drug development. The medical equipment manufacturer initially projected muted demand for its services in therapy and vaccine production through the first half of 2023 but anticipates an uptick later in the year. The Waltham, Massachusetts-based firm has revised its annual adjusted profit projections to $21.14-$22.02 per share, up from its previous estimate of $20.95-$22 per share. According to LSEG data, analysts had anticipated a profit of $21.53 per share for 2024.
Contract drug manufacturers experienced a reduction in spending from their biotech clients in 2023 due to rising interest rates. However, some analysts predict that biotech funding may stabilize in 2023 following a robust year for regulatory approvals in the United States.
Thermo Fisher’s laboratory products segment, which offers products and services for clinical trials and drug development, recorded revenue of $5.72 billion, surpassing analysts’ estimates of $5.17 billion. This segment accounts for more than half of Thermo’s total revenue of $10.35 billion, which also exceeded expectations of $10.17 billion.
On an adjusted basis, the company reported a profit of $5.11 per share, exceeding estimates of $4.71 per share. This growth was attributed to new product launches during the quarter.
