Executive Summary
IDEXX Laboratories reported solid Q3 2024 performance with a resilient top line and robust profitability metrics, supported by a favorable mix of high-margin diagnostic services and instruments. Revenue reached $975.5 million, up 6.6% year over year, while gross margins remained industry-leading at approximately 61.1%. Operating income of $303.9 million yielded an operating margin of 31.2%, and net income of $232.8 million translated to earnings per share (EPS) of $2.83 (diluted $2.80), underscoring the company's high-margin, cash-generative profile.
The quarter delivered strong cash conversion, with net cash provided by operating activities of $220.1 million and free cash flow of $192.0 million. Despite a $220.8 million annualized share repurchase during the period, IDEXX maintains a solid balance sheet: cash and equivalents of about $308.6 million, total debt of $998.3 million, and net debt of $689.6 million. The company remains well-positioned to fund growth initiatives and capital returns, supported by a cash-rich, asset-light profile and disciplined capital allocation. While management commentary on forward guidance is not included in the provided data, the cadence of QoQ and YoY improvements in profitability, plus strong cash flow, suggests continued resilience in core markets (companion animal diagnostics, reference labs, and water testing) with upside potential from services mix and software-enabled offerings. Investors should monitor clinic demand, practice spending trends, and currency dynamics as catalysts or headwinds going forward.
Key Performance Indicators
Key Insights
Revenue: $975.543 million (Q3 2024) vs $915.527 million (Q3 2023); YoY +6.56%, QoQ -2.79% (vs Q2 2024). Gross profit: $596.038 million; gross margin 61.10%; YoY +8.77%, QoQ -4.00%.
Operating income: $303.892 million; operating margin 31.15%; YoY +10.39%, QoQ +15.20%.
Net income: $232.841 million; net margin 23.87%; YoY +9.71%, QoQ +14.53%.
EPS: $2.83 (reported), $2.80 (diluted); YoY +10.98%, QoQ +15.04%.
EBITDA: $341.999 million; EBITDA margin 35.06%; D&A: $34.133 million.
Cash flow: Net cas...
Financial Highlights
Revenue: $975.543 million (Q3 2024) vs $915.527 million (Q3 2023); YoY +6.56%, QoQ -2.79% (vs Q2 2024). Gross profit: $596.038 million; gross margin 61.10%; YoY +8.77%, QoQ -4.00%.
Operating income: $303.892 million; operating margin 31.15%; YoY +10.39%, QoQ +15.20%.
Net income: $232.841 million; net margin 23.87%; YoY +9.71%, QoQ +14.53%.
EPS: $2.83 (reported), $2.80 (diluted); YoY +10.98%, QoQ +15.04%.
EBITDA: $341.999 million; EBITDA margin 35.06%; D&A: $34.133 million.
Cash flow: Net cash from operating activities $220.079 million; capex $28.089 million; free cash flow $191.99 million.
Liquidity and leverage: Cash $308.636 million; total debt $998.28 million; net debt $689.64 million; current ratio 1.363; quick ratio 0.976; interest coverage 33.93x.
Shareholder returns and capitalization: Net share repurchases $220.757 million; common stock issued ~$4.996 million.
Valuation (as of QQ3 2024): P/E around 44.9x; P/B 25.8x; P/S 42.8x; EV/EBITDA ~123.8x; FCF per share $2.33; Cash per share $3.75.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
975.54M |
6.56% |
-2.79% |
| Gross Profit |
596.04M |
8.77% |
-4.00% |
| Operating Income |
303.89M |
10.39% |
15.20% |
| Net Income |
232.84M |
9.71% |
14.53% |
| EPS |
2.83 |
10.98% |
15.04% |
Key Financial Ratios
operatingProfitMargin
31.2%
operatingCashFlowPerShare
$2.67
freeCashFlowPerShare
$2.33
Management Commentary
No earnings call transcript was provided in the data. As a result, transcript-based themes, quotes, and management commentary cannot be cited directly in this synthesis.
Forward Guidance
No explicit forward guidance was included in the provided materials. In the absence of formal guidance, the forward-looking assessment relies on trailing performance and industry dynamics. Key factors likely to influence IDEXX’s trajectory:
- Revenue growth drivers: ongoing demand for companion animal diagnostics, expanding reference laboratory services, and water testing markets. The Q3 2024 results show resilience with YoY revenue growth and a favorable margin mix, suggesting continued pricing power and service mix benefits.
- Margin trajectory: operating margin of 31.15% and gross margin of 61.1% reflect a high-margin portfolio; potential upside could come from higher-margin service and software solutions, while raw materials, supply chain costs, or mix shifts could compress margins if volumes shift.
- Cash generation and capital allocation: strong operating cash flow supports generous share repurchases and potential re-investment in growth initiatives. Investors should monitor the cadence of buybacks versus capex and R&D investment to assess balance between shareholder returns and organic growth funding.
- Industry and clinical adoption trends: demand for veterinary diagnostics remains a key driver, alongside water testing and livestock diagnostics. Any slowdown in clinic spending or regulatory changes affecting testing volumes could impact growth.
- Currency and international exposure: IDEXX’s global footprint exposes it to currency translation effects and cross-border sales dynamics, which could influence reported results in USD terms.