Encouraging results and a winning strategy

Despite a 1% drop in sales, adjusted earnings per share (EPS) came to $5.4, up 4% year-on-year. Operating income was up 15% to $1.82 billion, accompanied by an adjusted operating margin of 22.3%, up 10 basis points on 2023, and an adjusted gross margin of 42.2%, up 110 basis points. This performance is attributable to higher productivity in the Life Sciences (22% of sales) and Analytical Instruments (14% of sales) segments, which offset a slight decline in revenues from Laboratory Products and Biopharmaceuticals (55% of sales), due to lower revenues from COVID-related vaccines and therapies.

Another contributory factor was the introduction of its new range of innovative products, launched this year. It includes: a spectrometer for the analysis of proteins and their exact amino acid sequences, another for advanced analysis of all types of molecules to understand their function and design new drugs, a biosourced film of plant origin and “ULT Thermo Scientific” freezers for storing molecules at very low temperatures.

Thermo Fisher Scientific combines its portfolio expansion with a series of external growths with two new facilities, one in the Netherlands, another in America for clinical trials. In addition, it has expanded its presence in Indonesia and Singapore to support its investments in cell therapy. This strategy enables the Group to consolidate its international presence and optimize production costs.

The Group also finalized the acquisition of Olink, a $3 billion company based in Sweden, which provides next-generation proteomic solutions. This technology enables the identification, characterization and quantification of proteins present in a biological sample. This acquisition will enable TFS to strengthen its position in the field of proteomics and move forward with its projects.

Outlook for 2024

The prospect of monetary easing in the United States could breathe new life into the biotech sector, stimulating spending and reviving projects. This bodes well for Thermo Fisher.

With this in mind, the Group is revising all its guidance for 2024 upwards. It has set its sales forecasts at a new range of $42.4 to $43.3 billion, compared with its previous forecast of $42.3 to $43.3 billion. 43.3 billion, and its adjusted EPS guidance to a new range of $21.29 to $22.07, versus its previous guidance of $21.14 to $22.02.

Stock market epic

The market seems to have taken notice of this promising direction, and the stock gained over 4% in daily performance. This continues the Group's remarkable stock market run, with a price increase of almost 300% in 10 years.