QUEST DIAGNOSTICS INC
For the period ended Mar 31, 2025. Filed Apr 23, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed Apr 23, 2025
DGX$255.63+0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-10-23.
0001022079-24-000190
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-04-23.
0001022079-25-000120
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 146 previous paragraphs and 106 current paragraphs.
51 unchanged; 37 reworded; 17 added; 54 removed; 4 previous and 1 current paragraphs rearranged.
Tables are not compared: 4 previous and 4 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (17)
Current report
First Quarter Highlights
Current report
Results for the three months ended March 31, 2025 were affected by certain items that on a net basis decreased diluted earnings per share by $0.27 as follows:
Current report
•pre-tax amortization expense of $39 million recorded in amortization of intangible assets, or $0.26 per diluted share;
Current report
•pre-tax gains of $8 million, recorded in equity in earnings of equity method investees, net of taxes, or $0.06 per diluted share, principally consisting of a non-recurring gain related to a lease; and
Current report
Results for the three months ended March 31, 2024 were affected by certain items that on a net basis decreased diluted earnings per share by $0.32 as follows:
Current report
•pre-tax amortization expense of $29 million recorded in amortization of intangible assets or $0.19 per diluted share;
Current report
•pre-tax charges of $17 million ($13 million recorded in cost of services and $4 million recorded in selling, general and administrative expenses), or $0.12 per diluted share, primarily associated with workforce reductions and integration costs incurred in connection with further restructuring and integrating our business; and
Current report
•pre-tax charges of $3 million, recorded in other operating expense, net, or $0.03 per diluted share, representing a loss associated with the increase in the fair value of the contingent consideration accrual associated with previous acquisitions; partially offset by
Current report
Net revenues for the three months ended March 31, 2025 increased by 12.1% compared to the prior year period.
Current report
DIS revenues for the three months ended March 31, 2025 increased by 12.7% compared to the prior year period.
Current report
Other (Expense) Income, Net
Current report
The notional amount of fixed-to-variable interest rate swaps outstanding as of March 31, 2025 and December 31, 2024 was $1.25 billion and $700 million, respectively. The aggregate fair value of the fixed-to-variable interest rate swaps was $6 million and $34 million, in a liability position, as of March 31, 2025 and December 31, 2024, respectively.
Current report
Contractual Obligations
Current report
A description of the terms of our indebtedness and related debt service requirements is contained in Note 13 to the audited consolidated financial statements included in our 2024 Annual Report on Form 10-K.
Current report
A discussion of our lease obligations is contained in Note 14 to the audited consolidated financial statements included in our 2024 Annual Report on Form 10-K.
Current report
A discussion of our noncancellable commitments to purchase products or services is contained in Note 18 to the audited consolidated financial statements included in our 2024 Annual Report on Form 10-K.
Current report
In February 2025, we committed to a multi-year project ("Project Nova") to modernize our "Order-to-Cash" business processes including related information technology infrastructure and underlying enabling technologies. We expect to deliver value throughout the implementation of Project Nova, as it unlocks a variety of streamlined operational benefits, reduced technology-related operating costs, accelerated revenue opportunities and improvements to the customer and patient experience. See our 2024 Annual Report on Form 10-K for further details.
Removed paragraphs (54)
Previous report
Third Quarter Highlights
Previous report
Acquisition of select assets of Lenco Diagnostic Laboratories, Inc. ("Lenco")
Previous report
On February 12, 2024, we acquired select assets of Lenco, an independent clinical diagnostic laboratory provider serving physicians in New York, in an all-cash transaction for $111 million. The acquired business is included in our DIS business.
Previous report
Acquisition of select assets of PathAI Diagnostics
Previous report
On June 10, 2024, we acquired select assets of PathAI Diagnostics, a business that provides anatomic and digital pathology laboratory services, in an all-cash transaction for $100 million. The acquired business is included in our DIS business.
Previous report
Acquisition of LifeLabs Inc. ("LifeLabs")
Previous report
On August 23, 2024, we completed the acquisition of LifeLabs in an all-cash transaction for approximately CAN $1.35 billion (approximately USD $1 billion). LifeLabs provides laboratory diagnostic information and digital health connectivity systems in Canada. The acquired business is included in our DIS business.
Previous report
Acquisition of select assets of the outreach laboratory services business of Allina Health ("Allina")
Previous report
On September 16, 2024, we acquired select assets of the outreach laboratory services business of Allina, which serves providers and patients in Minnesota and Wisconsin, in an all-cash transaction for $230 million. The acquired business is included in our DIS business.
Previous report
Acquisition of the laboratory business of three physician groups in New York
Previous report
On September 30, 2024, we acquired the laboratory business of three physician groups in New York in an all-cash transaction for $300 million. The acquired business is included in our DIS business.
Previous report
For further details, see Note 5 to the interim unaudited consolidated financial statements.
Previous report
August 2024 Senior Notes Offering
Previous report
In August 2024, we completed a $1.85 billion senior notes offering, consisting of $400 million aggregate principal amount of 4.60% senior notes due December 2027 (the "2027 Senior Notes"), $600 million aggregate principal amount of 4.625% senior notes due December 2029 (the "2029 Senior Notes") and $850 million aggregate principal amount of 5.00% senior notes due December 2034 (the "2034 Senior Notes," and together with the 2027 Senior Notes and the 2029 Senior Notes, the "Senior Notes"). We used a portion of the net proceeds from the Senior Notes offering to fund the purchase price and related transaction costs of the acquisition of LifeLabs (see above for further details). We expect to use the balance of the net proceeds from the offering for general corporate purposes, which may include the redemption or repayment of indebtedness including our 3.50% senior notes due March 2025.
Previous report
For further details regarding our debt, see Note 7 to the interim unaudited consolidated financial statements.
Previous report
Results for the three months ended September 30, 2024 were affected by certain items that on a net basis decreased diluted earnings per share by $0.31 as follows:
Previous report
•pre-tax amortization expense of $32 million recorded in amortization of intangible assets, or $0.21 per diluted share;
Previous report
•pre-tax net charges of $18 million ($5 million recorded in cost of services and $15 million recorded in selling, general and administrative expenses, partially offset by a $2 million gain recorded in other operating expense, net), or $0.13 per diluted share, primarily associated with workforce reductions and integration costs incurred in connection with further restructuring and integrating our business;
Previous report
•pre-tax charges of $5 million ($1 million recorded in selling, general and administrative expenses and $4 million recorded in other operating expense, net), or $0.04 per diluted share, primarily representing a loss associated with the increase in the fair value of the contingent consideration accrual associated with previous acquisitions; and
Previous report
•a pre-tax gain of $8 million, recorded in other income (expense), net, or $0.06 per diluted share, representing a non-recurring gain associated with a foreign exchange forward contract utilized in conjunction with an acquisition, and
Previous report
Results for the nine months ended September 30, 2024 were affected by certain items that on a net basis decreased diluted earnings per share by $0.96 as follows:
Previous report
•pre-tax amortization expense of $90 million recorded in amortization of intangible assets, or $0.59 per diluted share;
Previous report
•pre-tax net charges of $45 million ($19 million recorded in cost of services and $28 million recorded in selling, general and administrative expenses, partially offset by a $2 million gain recorded in other operating expense, net), or $0.31 per diluted share, primarily associated with workforce reductions and integration costs incurred in connection with further restructuring and integrating our business;
Previous report
•pre-tax charges of $12 million ($2 million recorded in selling, general and administrative expenses and $10 million recorded in other operating expense, net), or $0.10 per diluted share, primarily representing a loss associated with the increase in the fair value of the contingent consideration accrual associated with previous acquisitions; and
Previous report
•pre-tax charges of $11 million recorded in equity in earnings of equity method investees, net of taxes, or $0.07 per diluted share, representing net losses associated with changes in the carrying value of our strategic investments; partially offset by
Previous report
•a pre-tax gain of $8 million, recorded in other income (expense), net, or $0.06 per diluted share, representing a non-recurring gain associated with a foreign exchange forward contract utilized in conjunction with an acquisition, and
Previous report
•$6 million of excess tax benefits associated with stock-based compensation arrangements, recorded in income tax expense, or $0.05 per diluted share.
Previous report
Results for the three months ended September 30, 2023 were affected by certain items that on a net basis decreased diluted earnings per share by $0.26 as follows:
Previous report
•pre-tax amortization expense of $27 million recorded in amortization of intangible assets or $0.18 per diluted share;
Previous report
•pre-tax charges of $5 million ($1 million in selling, general and administrative expenses and $4 million in other operating expense, net), or $0.04 per diluted share, primarily representing a loss associated with the increase in the fair value of the contingent consideration accrual associated with previous acquisitions; partially offset by
Previous report
•excess tax benefits associated with stock-based compensation arrangements of $2 million recorded in income tax expense, or $0.01 per diluted share.
Previous report
Results for the nine months ended September 30, 2023 were affected by certain items that on a net basis decreased diluted earnings per share by $0.77 as follows:
Previous report
•pre-tax amortization expense of $81 million recorded in amortization of intangible assets or $0.53 per diluted share;
Previous report
•pre-tax charges of $32 million ($12 million in cost of services and $20 million in selling, general and administrative expenses), or $0.22 per diluted share, primarily associated with workforce reductions and integration costs incurred in connection with further restructuring and integrating our business;
Previous report
•pre-tax charges of $11 million ($7 million in selling, general and administrative expenses and $4 million in other operating expense, net), or $0.08 per diluted share, primarily representing the impairment of a corporate facility that was sold and a loss associated with the increase in the fair value of the contingent consideration accrual associated with previous acquisitions, and
Previous report
•pre-tax charges of $3 million in equity in earnings of equity method investees, net of tax, or $0.02 per diluted share, representing net losses associated with changes in the carrying value of our strategic investments; partially offset by
Previous report
Net revenues for the three months ended September 30, 2024 increased by 8.5% compared to the prior year period.
Previous report
DIS revenues for the three months ended September 30, 2024 increased by 9.0% compared to the prior year period.
Previous report
•Revenue per requisition increased by 3.3% compared to the prior year period principally due to an increase in the number of tests per requisition and favorable test mix.
Previous report
Net revenues for the nine months ended September 30, 2024 increased by 4.1% compared to the prior year period.
Showing the first 40 of 54 passages. Open the source sections for the rest.
Reworded paragraphs (37)
Previous wording
For the nine months ended September 30, 2024, we incurred $45 million of pre-tax charges in connection with restructuring and integration activities, including $21 million of employee separation costs, with the remainder including integration costs. Most of the charges will result in cash expenditures. Additional restructuring and integration charges may be incurred in future periods, including as we identify additional opportunities to achieve further savings and productivity improvements.
Current wording
For the three months ended March 31, 2025, we incurred $19 million of pre-tax charges in connection with restructuring and integration activities, including $11 million of employee separation costs, with the remainder including integration costs. Most of the charges will result in cash expenditures. Additional restructuring and integration charges may be incurred in future periods, including as we identify additional opportunities to achieve further savings and productivity improvements.
Previous wording
•pre-tax charges of $6 million ($2 million in cost of services and $4 million in selling, general and administrative expenses), or $0.05 per diluted share, primarily associated with workforce reductions and integration costs incurred in connection with further restructuring and integrating our business; and
Current wording
•pre-tax charges of $19 million ($6 million recorded in cost of services and $13 million recorded in selling, general and administrative expenses), or $0.13 per diluted share, primarily associated with workforce reductions and integration costs incurred in connection with further restructuring and integrating our business; and
Previous wording
•pre-tax charges of $2 million recorded in equity in earnings of equity method investees, net of taxes, or $0.02 per diluted share, representing net losses associated with changes in the carrying value of our strategic investments; partially offset by
Current wording
•pre-tax charges of $2 million, recorded in other operating expense, net, or $0.02 per diluted share, primarily representing a loss associated with the increase in the fair value of the contingent consideration accrual associated with previous acquisitions; partially offset by
Previous wording
•excess tax benefits associated with stock-based compensation arrangements of $9 million recorded in income tax expense, or $0.08 per diluted share.
Current wording
•$9 million of excess tax benefits associated with stock-based compensation arrangements, recorded in income tax expense, or $0.08 per diluted share.
Previous wording
•$3 million of excess tax benefits associated with stock-based compensation arrangements, recorded in income tax expense, or $0.03 per diluted share.
Current wording
•$2 million of excess tax benefits associated with stock-based compensation arrangements, recorded in income tax expense, or $0.02 per diluted share.
Previous wording
•The increase in DIS revenues compared to the prior year period was driven primarily by organic growth and the impact of recent acquisitions. For the three months ended September 30, 2024, recent acquisitions contributed approximately 4.4% to DIS revenues.
Current wording
•The increase in DIS revenues compared to the prior year period was driven primarily by the impact of recent acquisitions and, to a lesser extent, organic growth. For the three months ended March 31, 2025, recent acquisitions contributed approximately 10.0% to DIS revenues.
Previous wording
•DIS volume increased by 5.5% compared to the prior year period primarily driven by the impact of recent acquisitions, which contributed approximately 5.0% to DIS volume.
Current wording
•DIS volume increased by 12.4% compared to the prior year period driven by the impact of recent acquisitions, which contributed approximately 13.3% to DIS volume, with organic volume down by 0.9%. During the quarter, weather and one less day versus the prior year reduced volume growth by approximately 1.6%.
Previous wording
•Revenue per requisition increased by 1.7% compared to the prior year period principally due to an increase in the number of tests per requisition and favorable test mix, partially offset by the impact of the decrease in COVID-19 testing.
Current wording
•Revenue per requisition increased by 0.3% compared to the prior year period principally due to an increase in the number of tests per requisition, substantially offset by the impact of LifeLabs Inc. (which was acquired during August 2024), which has a lower revenue per requisition. On an organic basis, revenue per requisition increased 3.6% during the quarter.
Previous wording
DS revenues for the three months ended September 30, 2024 decreased by 7.9% compared to the prior year period due to lower revenues associated with both our risk assessment services offered to insurers and our healthcare information technology businesses.
Current wording
DS revenues for the three months ended March 31, 2025 decreased by 7.7% compared to the prior year period principally due to lower revenues associated with our risk assessment services offered to insurers.
Previous wording
For the nine months ended September 30, 2024, cost of services increased by $218 million compared to the prior year period. The increase was primarily driven by the impact of recent acquisitions, wage increases, higher supplies expense, and lower performance-based compensation in the prior year period, partially offset by cost savings and productivity improvements from our Invigorate program.
Current wording
For the three months ended March 31, 2025, cost of services increased by $194 million compared to the prior year period. The increase was primarily driven by the impact of recent acquisitions, wage increases, and, to a lesser extent, higher supplies expense, partially offset by cost savings and productivity improvements from our Invigorate program.
Previous wording
For the three months ended September 30, 2024, SG&A increased by$68 million compared to the prior period. The increasewas primarily driven by the impact of recent acquisitions, lower performance-based compensation in the prior year period, and higher costs associated with changes in the value of our deferred compensation obligations.
Current wording
For the three months ended March 31, 2025, SG&A increased by $36 million compared to the prior period. The increase was primarily driven by the impact of recent acquisitions, partially offset by lower costs associated with changes in the value of our deferred compensation obligations.
Previous wording
The changes in the value of our deferred compensation obligations is largely offset by changes in the value of the associated investments, which are recorded in other income (expense), net. For further details regarding our deferred compensation plans, see Note 18 to the audited consolidated financial statements included in our 2023 Annual Report on Form 10-K.
Current wording
The changes in the value of our deferred compensation obligations is largely offset by changes in the value of the associated investments, which are recorded in other (expense) income, net. For further details regarding our deferred compensation plans, see Note 17 to the audited consolidated financial statements included in our 2024 Annual Report on Form 10-K.
Previous wording
For the three andnine months ended September 30, 2024, amortization expense increased by $5 million and $9 million, respectively, compared to the prior year periods, as a result of recent acquisitions.
Current wording
For the three months ended March 31, 2025, amortization expense increased by $10 million compared to the prior year period as a result of recent acquisitions.
Previous wording
For thethree andnine months ended September 30, 2024 and 2023, other operating expense, net primarily represents losses associated with the increase in the fair value of the contingent consideration accrual associated with previous acquisitions.
Current wording
For both the three months ended March 31, 2025 and 2024, other operating expense, net primarily represents losses associated with the increase in the fair value of the contingent consideration accrual associated with previous acquisitions.
Previous wording
For the three and nine months ended September 30, 2024, interest expense, net increased by $9 million and $24 million, respectively, compared to the prior year periods primarily due to the issuance during November 2023 of $750 million aggregate principal amount of 6.40% senior notes due 2033 and the issuance during August 2024 of $1.85 billion of Senior Notes (see "Third Quarter Highlights" above for further details), partially offset by increased interest income (principally due to higher cash on hand) and lower borrowings under our secured receivables credit facility.
Current wording
For the three months ended March 31, 2025, interest expense, net increased by $24 million compared to the prior year period primarily due to the issuance during August 2024 of $1.85 billion of senior notes.
Previous wording
Other income (expense), net represents miscellaneous income and expense items related to non-operating activities, such as gains and losses associated with investments and other non-operating assets.
Current wording
Other (expense) income, net represents miscellaneous income and expense items related to non-operating activities, such as gains and losses associated with investments and other non-operating assets.
Previous wording
For the three and nine months ended September 30, 2023, other income (expense), net included $3 million of losses and $9 million of gains, respectively, associated with investments in our deferred compensation plans.
Current wording
For the three months ended March 31, 2024, other (expense) income, net included $9 million of gains associated with investments in our deferred compensation plans.
Previous wording
Income tax expense for the three months ended September 30, 2024 and 2023 was $65 million and $68 million, respectively.
Current wording
Income tax expense for the three months ended March 31, 2025 and 2024 was $59 million and $66 million, respectively.
Previous wording
The effective income tax rate for the three months ended September 30, 2024 and 2023 was 21.9% and 22.8%, respectively. The effective income tax rate benefited from $3 million and $2 million of excess tax benefits associated with stock-based compensation arrangements for the three months ended September 30, 2024 and 2023, respectively.
Current wording
The effective income tax rate for the three months ended March 31, 2025 and 2024 was 21.5% and 25.0%, respectively. The effective income tax rate benefited from $9 million and $2 million of excess tax benefits associated with stock-based compensation arrangements for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
Equity in earnings of equity method investees, net of taxes, decreased by $4 million for the nine months ended September 30, 2024 compared to the prior year period primarily due to the nine months ended September 30, 2024 including $11 million of losses associated with changes in the carrying value of our strategic investments, partially offset by increased demand for testing services at our diagnostic information services joint venture.
Current wording
Equity in earnings of equity method investees, net of taxes, increased by $10 million for the three months ended March 31, 2025, compared to the prior year period, primarily due to the three months ended March 31, 2025 including an $8 million non-recurring gain related to a lease.
Previous wording
As of September 30, 2024 and December 31, 2023, the fair value of our debt was estimated at approximately $6.3 billion and $4.6 billion, respectively, principally using quoted prices in active markets and yields for the same or similar types of borrowings, taking into account the underlying terms of the debt instruments. As of September 30, 2024 and December 31, 2023, the estimated fair value was more than (less than) the carrying value of the debt by $32 million and $(127) million, respectively. A hypothetical 10% increase in interest rates (representing 32 basis points and 50 basis points as of September 30, 2024 and December 31, 2023, respectively) would potentially reduce the estimated fair value of our debt by approximately $178 million and $139 million, respectively, as of September 30, 2024 and December 31, 2023.
Current wording
As of March 31, 2025 and December 31, 2024, the fair value of our debt was estimated at approximately $5.8 billion and $6.1 billion, respectively, principally using quoted prices in active markets and yields for the same or similar types of borrowings, taking into account the underlying terms of the debt instruments. As of March 31, 2025 and December 31, 2024, the estimated fair value was less than the carrying value of the debt by $59 million and $112 million, respectively. A hypothetical 10% increase in interest rates (representing 49 basis points and 35 basis points as of March 31, 2025 and December 31, 2024, respectively) would potentially reduce the estimated fair value of our debt by approximately $157 million and $184 million, respectively, as of March 31, 2025 and December 31, 2024.
Previous wording
Borrowings under our secured receivables credit facility and our senior unsecured revolving credit facility are subject to variable interest rates. Interest on our secured receivables credit facility is based on either commercial paper rates for highly-rated issuers or the adjusted Term Secured Overnight Financing Rate ("Term SOFR"), plus a spread. Interest on our senior unsecured revolving credit facility is based on certain published rates plus an applicable margin based on changes in our public debt ratings. As such, our borrowing cost under this credit arrangement is subject to fluctuations in interest rates and changes in our public debt ratings. As of September 30, 2024, the borrowing rates under these debt instruments were: for our secured receivables credit facility, commercial paper rates for highly-rated issuers or the adjusted Term SOFR, plus a spread of 0.80%; and for our senior unsecured revolving credit facility, the adjusted Term SOFR, plus 1.00%. As of September 30, 2024, there were no borrowings outstanding under the secured receivables credit facility and there were no borrowings outstanding under the senior unsecured revolving credit facility.
Current wording
Borrowings under our secured receivables credit facility and our senior unsecured revolving credit facility are subject to variable interest rates. Interest on our secured receivables credit facility is based on either commercial paper rates for highly-rated issuers or the adjusted Term Secured Overnight Financing Rate ("Term SOFR"), plus a spread. Interest on our senior unsecured revolving credit facility is based on certain published rates plus an applicable margin based on changes in our public debt ratings. As such, our borrowing cost under this credit arrangement is subject to fluctuations in interest rates and changes in our public debt ratings. As of March 31, 2025, the borrowing rates under these debt instruments were: for our secured receivables credit facility, commercial paper rates for highly-rated issuers or the adjusted Term SOFR, plus a spread of 0.80%; and for our senior unsecured revolving credit facility, the adjusted Term SOFR, plus 1.00%. As of March 31, 2025, there were $215 million of borrowings outstanding under the secured receivables credit facility and there were no borrowings outstanding under the senior unsecured revolving credit facility.
Previous wording
Based on our net exposure to interest rate changes, a hypothetical 10% change to the variable rate component of our variable rate indebtedness would not materially change our annual interest expense.
Current wording
Based on our net exposure to interest rate changes, a hypothetical 10% change to the variable rate component of our variable-rate indebtedness would not materially change our annual interest expense. A hypothetical 10% change in the SOFR curve (representing a 38 basis points change in the weighted average yield) would potentially change the fair value of our fixed- to-variable interest rate swaps by $35 million.
Previous wording
Cash and cash equivalents consist of cash and highly-liquid short-term investments with original maturities, at the time of acquisition, of three months or less. Cash and cash equivalents as of September 30, 2024 totaled $764 million, compared to $686 million as of December 31, 2023.
Current wording
Cash and cash equivalents consist of cash and highly-liquid short-term investments with original maturities, at the time of acquisition, of three months or less. Cash and cash equivalents as of March 31, 2025 totaled $188 million, compared to $549 million as of December 31, 2024.
Previous wording
As of September 30, 2024, approximately 13% of our $764 million of consolidated cash and cash equivalents were held outside of the United States.
Current wording
As of March 31, 2025, approximately 44% of our $188 million of consolidated cash and cash equivalents were held outside of the United States.
Previous wording
Net cash provided by operating activities for the nine months ended September 30, 2024 and 2023 was $870 million and $745 million, respectively. The $125 million increase in net cash provided by operating activities for the nine months ended September 30, 2024, compared to the prior year period, was primarily a result of lower income tax payments and lower performance-based compensation payments.
Current wording
Net cash provided by operating activities for the three months ended March 31, 2025 and 2024 was $314 million and $154 million, respectively. The $160 million increase in net cash provided by operating activities for the three months ended March 31, 2025, compared to the prior year period, was primarily a result of the timing of payments and increased operating income.
Previous wording
Days sales outstanding, a measure of billing and collection efficiency, was 49 days as of September 30, 2024, 50 days as of of December 31, 2023 and 50 days as of September 30, 2023.
Current wording
Days sales outstanding, a measure of billing and collection efficiency, was 47 days as of March 31, 2025, 48 days as of December 31, 2024 and 50 days as of March 31, 2024.
Previous wording
Net cash used in investing activities for the nine months ended September 30, 2024 and 2023 was $2.0 billion and $947 million, respectively. This $1.1 billion increase in net cash used in investing activities for the nine months ended September 30, 2024, compared to the prior year period, was primarily a result of increased cash used for business acquisitions (see "Third Quarter Highlights" above for further details), partially offset by decreased capital expenditures.
Current wording
Net cash used in investing activities for the three months ended March 31, 2025 and 2024 was $115 million and $213 million, respectively. This $98 million decrease in net cash used in investing activities for the three months ended March 31, 2025, compared to the prior year period, was primarily a result of decreased cash used for business acquisitions.
Previous wording
We have $600 million of 3.50% senior notes due March 2025.
Current wording
Net cash used in financing activities for the three months ended March 31, 2025 and 2024 was $561 million and $153 million, respectively. This $408 million increase in net cash used in financing activities for the three months ended March 31, 2025, compared to the prior year period, was primarily a result of repaying in full the outstanding indebtedness under our $600 million of 3.50% senior notes (which matured on March 30, 2025) using a combination of cash on hand and $215 million of borrowings under our secured receivables credit facility.
Previous wording
During the nine months ended September 30, 2024, there were no borrowings or repayments under our secured receivables credit facility and our senior unsecured revolving credit facility.
Current wording
During the three months ended March 31, 2025, we borrowed $215 million under our secured receivables credit facility, none of which was repaid prior to March 31, 2025. During the three months ended March 31, 2025, there were no borrowings or repayments under our senior unsecured revolving credit facility. During the three months ended March 31, 2024, there were no borrowings or repayments under our secured receivables credit facility and our senior unsecured revolving credit facility.
Previous wording
During each of the first three quarters of 2024, our Board of Directors declared a quarterly cash dividend of $0.75 per common share. During each of the four quarters of 2023, our Board of Directors declared a quarterly cash dividend of $0.71 per common share.
Current wording
During the first quarter of 2025, our Board of Directors declared a quarterly cash dividend of $0.80 per common share. During each of the four quarters of 2024, our Board of Directors declared a quarterly cash dividend of $0.75 per common share.
Previous wording
As of September 30, 2024, $1.0 billion remained available under our share repurchase authorization. The share repurchase authorization has no set expiration or termination date.
Current wording
As of March 31, 2025, $0.9 billion remained available under our share repurchase authorization. The share repurchase authorization has no set expiration or termination date.
Previous wording
For both the nine months ended September 30, 2024 and 2023, we repurchased no shares of our common stock.
Current wording
For both the three months ended March 31, 2025 and 2024, we repurchased no shares of our common stock.
Previous wording
Our equity method investees primarily consist of a diagnostic information services joint venture and an investment in a fund that purchases strategic holdings in private companies in the healthcare industry. Such investees are accounted for under the equity method of accounting. Our investment in equity method investees is less than 5% of our consolidated total assets. Our proportionate share of income before income taxes associated with our equity method investees is less than 5% of our consolidated income before income taxes and equity in earnings of equity method investees. We have no material unconditional obligations or guarantees to, or in support of, our equity method investees and their operations.
Current wording
Our equity method investees primarily consist of a diagnostic information services joint venture and an investment in a fund that purchases strategic holdings in private companies in the healthcare industry. Such investees are accounted for under the equity method of accounting. Our investment in equity method investees is less than 5% of our consolidated total assets. Our proportionate share of income before income taxes associated with our equity method investees is approximately 5% of our consolidated income before income taxes and equity in earnings of equity method investees. We have no material unconditional obligations or guarantees to, or in support of, our equity method investees and their operations.
Previous wording
We estimate that we will invest approximately $420 million during 2024 for capital expenditures, to support and grow our existing operations, principally related to investments in laboratory equipment and facilities, including laboratory automations and information technology to support our diagnostic offerings.
Current wording
We estimate that we will invest approximately $500 million during 2025 for capital expenditures, to support and grow our existing operations, principally related to investments in laboratory equipment and facilities, including laboratory automations and information technology to support our diagnostic offerings.
Previous wording
As of September 30, 2024, we had $1.3 billion of borrowing capacity available under our existing credit facilities, including $527 million available under our secured receivables credit facility and $750 million available under our senior unsecured revolving credit facility. There were no borrowings outstanding under either the secured receivables credit facility or the senior unsecured revolving credit facility as of September 30, 2024. In support of our risk management program, $73 million in letters of credit under the secured receivables credit facility were outstanding as of September 30, 2024.
Current wording
As of March 31, 2025, we had $1.1 billion of borrowing capacity available under our existing credit facilities, including $308 million available under our secured receivables credit facility and $750 million available under our senior unsecured revolving credit facility. There were $215 million of borrowings outstanding under the secured receivables credit facility and no borrowings outstanding under the senior unsecured revolving credit facility as of March 31, 2025. In support of our risk management program, $77 million in letters of credit under the secured receivables credit facility were outstanding as of March 31, 2025.
Previous wording
Some statements and disclosures in this document are forward-looking statements. Forward-looking statements include all statements that do not relate solely to historical or current facts and can be identified by the use of words such as “may,” “believe,” “will,” “expect,” “project,” “estimate,” “anticipate,” “plan”, "aim", or “continue.” These forward-looking statements are based on our current plans and expectations and are subject to a number of risks and uncertainties that could cause our plans and expectations, including actual results, to differ materially from the forward-looking statements. Risks and uncertainties that may affect our future results include, but are not limited to, adverse results from pending or future government investigations, lawsuits or private actions, the competitive environment, the complexity of billing, reimbursement and revenue recognition for clinical laboratory testing, changes in government regulations, changing relationships with customers, payers, suppliers and strategic partners, acquisitions and other factors discussed in our most recently filed Annual Report on Form 10-K and subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, including those discussed in the “Business,” “Risk Factors,” “Cautionary Factors that May Affect Future Results” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of those reports.
Current wording
Some statements and disclosures in this document are forward-looking statements. Forward-looking statements include all statements that do not relate solely to historical or current facts and can be identified by the use of words such as “may,” “believe,” “will,” “expect,” “project,” “estimate,” “anticipate,” “plan”, "aim", or “continue.” These forward-looking statements are based on our current plans and expectations and are subject to a number of risks and uncertainties that could cause our plans and expectations, including actual results, to differ materially from the forward-looking statements. Risks and uncertainties that may affect our future results include, but are not limited to, uncertain and volatile economic conditions, adverse results from pending or future government investigations, lawsuits or private actions, the competitive environment, the complexity of billing, reimbursement and revenue recognition for clinical laboratory testing, changes in government policies, including related to trade, and regulations, changing relationships with customers, payers, suppliers and strategic partners, acquisitions and other factors discussed in our most recently filed Annual Report on Form 10-K and subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, including those discussed in the “Business,” “Risk Factors,” “Cautionary Factors that May Affect Future Results” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of those reports.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
For the three months ended March 31, 2025, other (expense) income, net included $2 million of losses associated with investments in our deferred compensation plans.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
DS revenues for the nine months ended September 30, 2024 decreased by 7.2% compared to the prior year period due to lower revenues associated with both our risk assessment services offered to insurers and our healthcare information technology businesses.
Previous report — wording carried elsewhere
For the three months ended September 30, 2024, cost of services increased by $136 million comp ared to the prior year period. The increase was primarily driven by the impact of recent acquisitions, wage increases, higher supplies expense, and lower performance-based compensation in the prior year period, partially offset by cost savings and productivity improvements from our Invigorate program.
Previous report — wording carried elsewhere
The effective income tax rate for the nine months ended September 30, 2024 and 2023 was 23.4% and 23.3%, respectively. The effective income tax rate benefited from $6 million and $9 million of excess tax benefits associated with stock-based compensation arrangements for the nine months ended September 30, 2024 and 2023, respectively.
Previous report — wording carried elsewhere
During the nine months ended September 30, 2023, we borrowed $1.6 billion under our secured receivables credit facility, $1.3 billion of which was repaid prior to September 30, 2023. Additionally, during the nine months ended September 30, 2023, we borrowed $125 million under our senior unsecured revolving credit facility, which was repaid prior to September 30, 2023.