Quest Diagnostics reported solid year-over-year revenue growth in QQ3 2025, supported by stronger testing volumes and favorable mix, with revenue of $2.816 billion, up 13.18% versus the prior-year period. The quarter delivered an EBITDA of $386 million and operating income of $386 million, underscoring a mid-teens margin profile (operating margin ~13.7%) despite ongoing cost pressures. Net income totaled $245 million with basic EPS of $2.18 (diluted $2.16), reflecting a positive but modest net profit expansion on a year-over-year basis (YoY net income +8.4%), tempered by a QoQ decline of roughly 12.8% in net income and a similar drop in reported earnings per share. The company continues to generate healthy operating cash flow (operating cash flow per share of $5.03) and free cash flow per share of $3.74, supporting a payout ratio of 36.3% and a modest dividend yield (~0.42%). Liquidity remains adequate (current ratio ~1.13; quick ratio ~1.04) with a lean but manageable leverage profile (debt ratio ~0.39; interest coverage ~5.6x).
Key Performance Indicators
Revenue
Increasing
2.82B
QoQ: 1.99% | YoY: 13.18%
Gross Profit
Increasing
949.00M
33.70% margin
QoQ: 0.53% | YoY: 17.02%
Operating Income
Increasing
386.00M
QoQ: -9.18% | YoY: 16.97%
Net Income
Increasing
245.00M
QoQ: -12.81% | YoY: 8.41%
EPS
Increasing
2.18
QoQ: -13.15% | YoY: 8.46%
Revenue Trend
Margin Analysis
Financial Highlights
- Revenue: $2.816B, YoY +13.18%, QoQ +1.99%
- Gross Profit: $0.949B, Margin 33.70%, YoY +17.02%, QoQ +0.53%
- Operating Income: $0.386B, Margin 13.70%, YoY +16.97%, QoQ -9.18%
- Net Income: $0.245B, Margin 8.70%, YoY +8.41%, QoQ -12.81%
- EPS (GAAP): $2.18; Diluted: $2.16; YoY +8.46%, QoQ -13.15%
- EBITDA: $0.386B, EBITDA Margin ~13.7%
- Cash Flow: Operating cash flow per share $5.03; Free cash flow per share $3.74; Cash per share $3.86; Payout ratio 36.3%
- Liquidity: Current ratio 1.128; Quick ratio 1.041; Cash ratio 0.202; CCC = -14.74 days
- Leverage: Debt ratio 0.394; Interest coverage 5.59x; Long-term debt to capitalization 41.6%; Total debt to capitalization 46.8%
- Valuation signals: P/E ~21.8x; P/B ~2.94x; P/S ~7.58x; EV/EBITDA multiple ~49.9x; Dividend yield ~0.42%
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
2.82B
13.18%
1.99%
Gross Profit
949.00M
17.02%
0.53%
Operating Income
386.00M
16.97%
-9.18%
Net Income
245.00M
8.41%
-12.81%
EPS
2.18
8.46%
-13.15%
Key Financial Ratios
Gross Profit Margin
Fair
33.70%
Gross profit margin is moderate, room for improvement in cost management
Operating Profit Margin
Fair
13.70%
Operating margin is moderate, room for improvement in cost management
Net Profit Margin
Fair
8.70%
Net profit margin is moderate, room for improvement in cost management
Return on Assets
Weak
1.51%
Return on assets suggests inefficient capital allocation
Return on Equity
Weak
3.38%
Return on equity suggests inefficient capital allocation
Current Ratio
Adequate
1.13
Current ratio meets minimum requirements but limited cushion