Cinemark to Host Second Quarter 2025 Earnings Conference Call
8:30 a.m. Eastern Time
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Please access 5-10 minutes before the call:
https://event.choruscall.com/mediaframe/webcast.html?webcastid=DJxaQPHu
A replay of the call will be available at https://ir.cinemark.com following the call and archived for a limited time.
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About Cinemark Holdings, Inc.
Cinemark Holdings, Inc. (NYSE: CNK) provides extraordinary out-of-home entertainment experiences as one of the largest and most influential theatrical exhibition companies in the world. Based in Plano, Texas, Cinemark makes every day cinematic for moviegoers across approximately 500 theaters, operating in 42 states in the U.S. (304 theaters; 4,246 screens) and 13 South and Central American countries (193 theaters; 1,398 screens). Cinemark offers guests superior sight and sound technology, including Barco laser projection and Cinemark XD, the world's No. 1 exhibitor-branded premium large format; industry-leading penetration of upscale amenities such as expanded food and beverage offerings, Luxury Lounger recliners and D-BOX motion seats; top-notch guest service; and award-winning loyalty programs such as Cinemark Movie Club. All of this creates an immersive environment for a shared, entertaining escape, underscoring that there is no place more cinematic than Cinemark. For more information, visit https://ir.cinemark.com.
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L3Harris Technologies Reports Strong Second Quarter 2025 Results, Increases 2025 Guidance
Highlights* Orders of $8.3 billion; book-to-bill of 1.5x Revenue of $5.4 billion, up 2%, and 6% organically Operating margin of 10.5%; Adjusted segment operating margin of 15.9% Diluted EPS of $2.44; Non-GAAP diluted EPS of $2.78, up 16% 2025 guidance and 2026 outlook increased on strong performance and improved expectations MELBOURNE, Fla., July 24, 2025--(BUSINESS WIRE)--L3Harris Technologies (NYSE: LHX) reported second quarter 2025 diluted EPS of $2.44 on second quarter 2025 revenue of $5.4 billion. Second quarter 2025 non-GAAP diluted EPS was $2.78. Reconciliations of non-GAAP results are detailed in tables beginning on page 11. "We delivered impressive second-quarter results, led by a record book-to-bill of 1.5x, solid organic growth, and year-over-year adjusted segment operating margin expansion for the seventh consecutive quarter. This marks a clear inflection point, with our strongest top-line growth in six quarters and meaningful progress towards our 2026 Financial Framework. Our Trusted Disruptor strategy continues to drive differentiated, mission-critical solutions that meet our customers' evolving needs while creating value for shareholders," said Christopher E. Kubasik, Chair and CEO. Kubasik added, "Defense is entering a generational investment cycle, as U.S. and allied budgets grow rapidly. Demand is accelerating, and our portfolio is aligned with key growth areas – Golden Dome, space, missiles, shipbuilding, autonomy, and resilient communications. With the flexibility of our business-model agnostic approach – able to win as a prime, sub, or merchant supplier – a focused national security portfolio, and competitive momentum from LHX NeXt, we're confident in our path to sustained profitable growth and long-term value creation." ___ *Organic revenue, adjusted segment operating margin and non-GAAP diluted EPS are non-GAAP financial measures defined on page 16. SUMMARY FINANCIAL RESULTS* Second Quarter Year to Date 2025 Guidance ($ millions, except per share data) 2025 20241 Change 2025 20241 Change Revenue (see Table 4 for organic revenue) Communication Systems $ 1,376 $ 1,346 $ 2,728 $ 2,640 Integrated Mission Systems 1,622 1,671 3,214 3,298 Space & Airborne Systems 1,787 1,707 3,398 3,458 Aerojet Rocketdyne 698 633 1,327 1,217 Corporate eliminations (57) (58) (109) (103) Revenue $ 5,426 $ 5,299 2% $ 10,558 $ 10,510 —% ~$21.75B(Prior: $21.4B - 21.7B) Operating income Communication Systems 336 329 681 639 Integrated Mission Systems 214 200 417 385 Space & Airborne Systems 220 215 396 431 Aerojet Rocketdyne 93 81 169 158 Unallocated corporate expenses (292) (349) (567) (759) Operating income $ 571 $ 476 $ 1,096 $ 854 Adjusted segment operating income $ 863 $ 825 5% $ 1,663 $ 1,613 3% Margin Operating margin 10.5% 9.0% 10.4% 8.1% Adjusted segment operating margin 15.9% 15.6% 30 bps 15.8% 15.3% 50 bps mid - high 15% Tax rate Effective tax rate (GAAP) 12.6% 5.9% 14.1% 4.1% Effective tax rate (non-GAAP) 9.5% 7.8% 11.5% 6.7% EPS Diluted EPS $ 2.44 $ 1.92 $ 4.48 $ 3.40 Non-GAAP diluted EPS $ 2.78 $ 2.40 16% $ 5.18 $ 4.64 12% $10.40 - $10.60(Prior: $10.30 - $10.50) Pension adjusted non-GAAP diluted EPS $ 2.42 $ 1.98 22% $ 4.38 $ 3.79 16% Diluted weighted-average common shares outstanding 187.8 190.6 188.5 190.8 Cash flow Cash from operations $ 640 $ 754 (15%) $ 598 $ 650 (8%) Adjusted free cash flow $ 574 $ 714 (20%) $ 502 $ 558 (10%) ~$2.65B(Prior: $2.4B - $2.5B) *A reconciliation of adjusted segment operating income and margin, non-GAAP effective tax rate, diluted EPS and pension adjusted diluted EPS, and adjusted free cash flow on a forward-looking basis to GAAP is not available without unreasonable effort due to the unavailability of items for exclusion from the GAAP measure. We are unable to address the probable significance of this information, the variability of which may have a significant impact on future GAAP results. See Non-GAAP Financial Measures on page 7 for more information. 1 2024 segment financial results recast to reflect strategic realignment of the Fuzing and Ordnance Systems (FOS) business from Integrated Mission Systems to Aerojet Rocketdyne, effective in 2025. See Table 9 - 2024 Segment Recast in our EX-99.1 Earnings Release for first quarter 2025. Revenue: Second quarter revenue increased 2%, 6% organically, reflecting growth across all segments, primarily from higher volumes, new program ramps and increased international demand. Operating Margin: GAAP Operating Margin: Second quarter increased 150 bps to 10.5% primarily driven by lower unallocated corporate expenses, including lower LHX NeXt implementation costs, amortization of acquisition-related intangibles and the absence of business divestiture-related losses and impairment of goodwill that impacted 2024. Adjusted Segment Operating Margin: Second quarter expanded 30 bps to 15.9% primarily driven by monetization of legacy end-of-life assets, aligned with our transformation and value creation priorities, and LHX NeXt driven cost saving across all segments, partially offset by impacts from higher margin Commercial Aviation Solutions (CAS) divestiture. Diluted EPS: GAAP Diluted EPS: Second quarter increased 27% to $2.44 driven by higher operating income and lower interest expense from decreased average outstanding short-term debt balances during second quarter 2025, partially offset by a higher effective tax rate. Non-GAAP Diluted EPS and Pension Adjusted Non-GAAP Diluted EPS: Second quarter increased 16% to $2.78 and 22% to $2.42, respectively, from higher adjusted segment operating income and lower interest expense from decreased average outstanding short-term debt balances during second quarter 2025, partially offset by a higher effective tax rate. Cash Flow: Cash From Operations: Second quarter decreased 15% to $640 million driven by working capital timing and cash used for settlement of a longstanding legal matter, partially offset by growth in operating income. Adjusted Free Cash Flow: Second quarter decreased 20% to $574 million, driven by working capital timing, cash used for settlement of a longstanding legal matter, partially offset by growth in operating income and lower capital expenditures. SEGMENT RESULTS* Communication Systems Second Quarter Year to Date 2025 Guidance ($ millions) 2025 2024 Change 2025 2024 Change Revenue $ 1,376 $ 1,346 2% $ 2,728 $ 2,640 3% $5,600 - $5,700 Operating margin 24.4% 24.4% — bps 25.0% 24.2% 80 bps ~25% Revenue: Second quarter revenue increased 2% primarily driven by increased international demand for resilient communication equipment and related waveforms. Operating Margin: Second quarter operating margin was flat, reflecting higher volume and LHX NeXt driven cost savings, partially offset by the absence of the favorable impact of legal settlements that impacted 2024. Integrated Mission Systems Second Quarter Year to Date 2025 Guidance ($ millions) 2025 2024 Change 2025 2024 Change Revenue $ 1,622 $ 1,671 (3)% $ 3,214 $ 3,298 (3)% ~$6,400(Prior: ~$6,300) Operating margin 13.2% 12.0% 120 bps 13.0 % 11.7% 130 bps ~12%(Prior: high 11%) Revenue: Second quarter revenue decreased 3%, reflecting the divestiture of our CAS business in the first quarter of 2025. Excluding the divestiture impact, organic revenue increased 6% primarily due to ISR classified program ramp. Operating Margin: Second quarter operating margin increased 120 bps to 13.2% primarily due to monetization of legacy end-of-life assets, aligned with our transformation and value creation priorities, partially offset by an unfavorable EAC adjustment from the resolution of a contract matter related to lower utilization on the Canadian Maritime Helicopter Program as it nears completion and impact from divestiture of our CAS business. *Organic revenue is a non-GAAP financial measure defined on page 16. Space and Airborne Systems Second Quarter Year to Date 2025 Guidance ($ millions) 2025 2024 Change 2025 2024 Change Revenue $ 1,787 $ 1,707 5% $ 3,398 $ 3,458 (2)% ~$7,100(Prior: $6,900 - $7,100) Operating margin 12.3% 12.6% (30) bps 11.7% 12.5% (80) bps low 12% Revenue: Second quarter revenue increased 5%, including the impact from the divestiture of our antenna business in the second quarter of 2024. Excluding the divestiture impact, organic revenue increased 7%, primarily from increased FAA volume in our Mission Networks business and higher volume and improved program performance in our Airborne Combat Systems business, partially offset by lower volumes in our Space Systems and Intel and Cyber businesses associated with program timing. Operating Margin: Second quarter operating margin decreased 30 bps to 12.3% primarily from unfavorable mix, partially offset by monetization of legacy end-of-life assets aligned with our transformation and value creation priorities, improved program performance and LHX NeXt driven cost savings. Aerojet Rocketdyne Second Quarter Year to Date 2025 Guidance ($ millions) 2025 2024 Change 2025 2024 Change Revenue $ 698 $ 633 10% $ 1,327 $ 1,217 9% ~$2,800 Operating margin 13.3% 12.8 % 50 bps 12.7% 13.0 % (30) bps mid 12% Revenue: Second quarter revenue increased 10%, including the impact from the divestiture of our AOT business in the fourth quarter of 2024. Excluding the divestiture impact, organic revenue increased 12% from increased production volume across key missile and munitions programs and new program ramp. Operating Margin: Second quarter operating margin increased 50 bps to 13.3%, primarily due to improved performance driven by LHX NeXt driven cost savings and a favorable contract resolution. *Organic revenue is a non-GAAP financial measure defined on page 16. 2025 NON-GAAP EPS GUIDANCE BRIDGE Our updated 2025 non-GAAP diluted EPS guidance reflects an increase of 200 to 300 basis points to the effective tax rate, resulting in a headwind of ~$0.30 at the midpoint. This impact is more than offset by strong first-half performance and increased guidance, driving a net increase of $0.10 to our full-year non-GAAP diluted EPS guidance. 2025 Guidance Non-GAAP diluted EPS (Prior) $10.30 - $10.50 H1 2025 performance and guidance update ~0.40 Non-GAAP EPS (Before tax reform impact) $10.70 - $10.90 Impact of tax reform ~(0.30) Non-GAAP diluted EPS (New)1 $10.40 - $10.60 SUPPLEMENTAL INFORMATION 2025 Other Information Current Prior FAS/CAS operating adjustment ~$15 million ~$15 million Non-service FAS pension income ~$285 million ~$270 million Net interest expense ~$600 million ~$600 million Effective tax rate on non-GAAP income1 13.5% - 14.5% 11.0% - 12.0% Weighted-average diluted shares ~188 188 - 189 Capital expenditures ~2% revenue ~2% revenue 1Non-GAAP diluted EPS and effective tax rate on non-GAAP income are non-GAAP financial measures defined on page 16. A reconciliation of non-GAAP diluted EPS and effective tax rate on non-GAAP income guidance is not available. See Non-GAAP Financial Measures on page 7 for more information. Forward-Looking Statements This earnings release contains forward-looking statements within the meaning of federal securities laws made in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Examples include, but are not limited to: share repurchases; divestiture and realignment impacts; 2025 guidance; budget increases; anticipated LHX NeXt initiative costs and savings; supplemental information for 2025; projection of other financial items; and assumptions underlying any of the foregoing. Investors should not place undue reliance on forward-looking statements, which reflect management's current expectations, estimates, projections, assumptions and information currently available to management, and are not guarantees of future performance or actual results. Important risks that could cause our results to differ materially from those expressed in or implied by these forward-looking statements or from our historical results include, but are not limited to, risks arising from: competitive markets; U.S. Government spending priorities; changes in contract mix; inflation; tariffs and potential trade disputes; unilateral contract action by the U.S. Government; uncertain economic conditions; future geo-political events; supply chain disruptions; impacts of LHX NeXt; indebtedness; defined benefit plan liabilities and returns; interest rates and other market factors; changes in effective tax rate or additional tax exposures; pending and contemplated divestitures. These and other important risks that could impact forward-looking statements are described more fully in the "Risk Factors" in our Form 10-K for fiscal 2024 and our Form 10-Q for Q1 2025 filed with the SEC. All subsequent written and oral forward-looking statements attributable to us or any person acting on our behalf are qualified by the cautionary statements in this section, and we have no duty to and disclaim any intention or obligation, other than imposed by law, to update or revise any forward-looking statements, whether as a result of new information, future events or developments or otherwise. Non-GAAP Financial Measures Management believes the adjustments to non-GAAP Financial Measures ("NGFMs") in the tables beginning on page 13 are useful to investors because the excluded costs do not reflect our ongoing operating performance. Such adjustments, considered together with the unadjusted GAAP financial measures, provide information that management believes is useful to investors to understand period-over-period operating results separate from items that management believes may disproportionately impact operating results in any particular period; however there is no guarantee that items excluded from NGFMs will not reoccur in future periods. Management also believes that NGFMs enhance the ability of investors to analyze business trends, understand performance and evaluate our initiatives to drive improved financial performance. Management utilizes NGFMs to guide forecasting and long-term planning and for compensation purposes. NGFMs should be considered in addition to, and not as a substitute for, financial measures presented in accordance with GAAP. A reconciliation of forward-looking NGFMs to GAAP is not available without unreasonable effort because of inherent difficulty in forecasting and quantifying comparable GAAP measures and applicable adjustments and other amounts necessary for a reconciliation because of potentially high variability, complexity and low visibility of applicable adjustments and other unusual amounts that could disproportionately impact future GAAP results, such as the impact of defined benefit plan performance, LHX NeXt, portfolio shaping activities, and the extent of tax deductibility. Table 1 - Condensed Consolidated Statement of Operations (Unaudited) Second Quarter Year to Date ($ millions, except per share amounts) 2025 2024 2025 2024 Revenue $ 5,426 $ 5,299 $ 10,558 $ 10,510 Cost of revenue (4,091 ) (3,939 ) (7,873 ) (7,802 ) General and administrative expenses (764 ) (884 ) (1,589 ) (1,854 ) Operating income 571 476 1,096 854 Non-service FAS pension income and other, net1 105 86 189 174 Interest expense, net (152 ) (172 ) (302 ) (348 ) Income before income taxes 524 390 983 680 Income taxes (66 ) (23 ) (139 ) (28 ) Net income 458 367 844 652 Noncontrolling interests, net of income taxes — (1 ) — (3 ) Net income attributable to L3Harris $ 458 $ 366 $ 844 $ 649 Earnings per share attributable to common shareholders Basic $ 2.45 $ 1.93 $ 4.50 $ 3.42 Diluted $ 2.44 $ 1.92 $ 4.48 $ 3.40 Weighted-average common shares outstanding Basic 187.0 189.7 187.7 189.8 Diluted 187.8 190.6 188.5 190.8 1"FAS" is defined as Financial Accounting Standards. Table 2 - Consolidated Statement of Cash Flow (Unaudited) Second Quarter Year to Date ($ millions) 2025 2024 2025 2024 Operating Activities Net income $ 458 $ 367 $ 844 $ 652 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 303 319 604 639 Share-based compensation 29 27 48 53 Net periodic benefit income (66 ) (71 ) (150 ) (143 ) Share-based matching contributions under defined contribution plans 68 72 136 142 Deferred income taxes (5 ) (136 ) (94 ) (247 ) (Increase) decrease in: Receivables, net 64 (32 ) (383 ) (25 ) Contract assets (214 ) 175 (634 ) (165 ) Inventories, net (6 ) 27 86 6 Other current assets (3 ) (36 ) (22 ) (26 ) Increase (decrease) in: Accounts payable (14 ) (209 ) 38 (200 ) Contract liabilities 193 14 177 (138 ) Compensation and benefits 130 69 25 (101 ) Other current liabilities (279 ) 103 (268 ) 85 Income taxes 48 108 321 211 Other operating activities (66 ) (43 ) (130 ) (93 ) Net cash provided by operating activities 640 754 598 650 Investing Activities Capital expenditures (88 ) (97 ) (147 ) (212 ) Proceeds from sales of businesses, net of cash divested — 158 831 158 Other investing activities 10 (3 ) (18 ) (4 ) Net cash (used in) provided by investing activities (78 ) 58 666 (58 ) Financing Activities Proceeds from issuances of long-term debt, net — 4 — 2,241 Repayments of long-term debt (606 ) (357 ) (611 ) (2,607 ) Change in commercial paper, maturities under 90 days, net 450 171 470 497 Proceeds from commercial paper, maturities over 90 days — 208 — 688 Repayments of commercial paper, maturities over 90 days — (480 ) — (685 ) Repurchases of common stock (253 ) (89 ) (822 ) (322 ) Dividends paid (225 ) (221 ) (453 ) (445 ) Other financing activities 24 20 1 33 Net cash (used in) provided by financing activities (610 ) (744 ) (1,415 ) (600 ) Effect of exchange rate changes on cash and cash equivalents 13 2 18 (5 ) Net decrease in cash and cash equivalents (35 ) 70 (133 ) (13 ) Cash and cash equivalents, beginning of period 517 477 615 560 Cash and cash equivalents, end of period $ 482 $ 547 $ 482 $ 547 Table 3 - Condensed Consolidated Balance Sheet (Unaudited) ($ millions) June 27, 2025 January 3, 2025 Assets Current assets Cash and cash equivalents $ 482 $ 615 Receivables, net 1,437 1,072 Contract assets 3,857 3,230 Inventories, net 1,258 1,330 Income taxes receivable 93 379 Other current assets 481 461 Assets of business held for sale — 1,131 Total current assets 7,608 8,218 Non-current assets Property, plant and equipment, net 2,742 2,806 Goodwill 20,372 20,325 Intangible assets, net 7,261 7,639 Deferred income taxes 89 120 Other non-current assets 3,168 2,893 Total assets $ 41,240 $ 42,001 Liabilities and equity Current liabilities Short-term debt $ 985 $ 515 Current portion of long-term debt, net 141 640 Accounts payable 2,033 2,005 Contract liabilities 2,317 2,142 Compensation and benefits 444 419 Other current liabilities 1,402 1,677 Liabilities of business held for sale — 235 Total current liabilities 7,322 7,633 Non-current liabilities Long-term debt, net 10,976 11,081 Deferred income taxes 800 942 Other non-current liabilities 2,864 2,766 Total liabilities 21,962 22,422 Total equity 19,278 19,579 Total liabilities and equity $ 41,240 $ 42,001 Reconciliation of Non-GAAP Financial Measures Table 4 - Organic Revenue Reconciliation (Unaudited) Second Quarter 2025 2024 ($ millions) GAAP Adjustments Organic GAAP Adjustments1 Organic CS $ 1,376 — $ 1,376 $ 1,346 — $ 1,346 IMS 1,622 — 1,622 1,671 (138 ) 1,533 SAS 1,787 — 1,787 1,707 (32 ) 1,675 AR 698 — 698 633 (12 ) 621 Corporate eliminations (57 ) — (57 ) (58 ) — (58 ) Revenue $ 5,426 $ — $ 5,426 $ 5,299 $ (182 ) $ 5,117 Year to Date 2025 2024 ($ millions) GAAP Adjustments Organic GAAP Adjustments1 Organic CS $ 2,728 $ — $ 2,728 $ 2,640 $ — $ 2,640 IMS 3,214 — 3,214 3,298 (138 ) 3,160 SAS 3,398 — 3,398 3,458 (76 ) 3,382 AR 1,327 — 1,327 1,217 (20 ) 1,197 Corporate eliminations (109 ) — (109 ) (103 ) — (103 ) Revenue $ 10,558 $ — $ 10,558 $ 10,510 $ (234 ) $ 10,276 1Adjustment to exclude amounts attributable to divested businesses. Table 5 - Reconciliation of Operating Income to Adjusted Segment Operating Income (Unaudited) Second Quarter Year to Date ($ millions) 2025 2024 2025 2024 Operating income $ 571 $ 476 $ 1,096 $ 854 Unallocated corporate department items Amortization of acquisition-related intangibles 193 215 387 432 Unallocated corporate department expense, net 50 33 65 66 FAS/CAS operating adjustment (3 ) (6 ) (6 ) (13 ) Total unallocated corporate department items 240 242 446 485 Significant and/or non-recurring items: Merger, acquisition, and divestiture-related expenses1 13 21 30 61 Business divestiture-related losses and impairment of goodwill1 — 38 17 38 LHX NeXt implementation costs1 39 48 74 175 Total significant and/or non-recurring items 52 107 121 274 Unallocated corporate expenses 292 349 567 759 Adjusted segment operating income $ 863 $ 825 $ 1,663 $ 1,613 1Refer to Key Terms and Non-GAAP Definitions on page 16. Table 6 - Reconciliation of Effective Tax Rate to Effective Tax Rate on Non-GAAP Income (Unaudited) Second Quarter 2025 2024 ($ millions) Earnings Before Tax Tax Expense (Benefit) Effective Tax Rate Earnings Before Tax Tax Expense Effective Tax Rate Income before income taxes $ 524 $ 66 12.6 % $ 390 $ 23 5.9 % Merger, acquisition, and divestiture-related expenses1 13 3 21 7 Business divestiture-related losses and impairment of goodwill1 — (18 ) 38 (2 ) LHX NeXt implementation costs1 39 4 48 11 Non-GAAP income before income taxes $ 576 $ 55 9.5 % $ 497 $ 39 7.8 % Year to Date 2025 2024 ($ millions) Earnings Before Tax Tax Expense (Benefit) Effective Tax Rate Earnings Before Tax Tax Expense Effective Tax Rate Income before income taxes $ 983 $ 139 14.1 % $ 680 $ 28 4.1 % Merger, acquisition, and divestiture-related expenses1 30 4 61 16 Business divestiture-related losses and impairment of goodwill1 17 (23 ) 38 (2 ) LHX NeXt implementation costs1 74 7 175 22 Non-GAAP income before income taxes $ 1,104 $ 127 11.5 % $ 954 $ 64 6.7 % 1Refer to Key Terms and Non-GAAP Definitions on page 16. Table 7 - Reconciliation of Diluted EPS to Non-GAAP Diluted EPS and Pension Adjusted Non-GAAP Diluted EPS (Unaudited) Second Quarter Year to Date ($ millions, except per share data) 2025 2024 2025 2024 Diluted weighted-average common shares outstanding 187.8 190.6 188.5 190.8 Diluted EPS $ 2.44 $ 1.92 $ 4.48 $ 3.40 Significant and/or non-recurring items included in diluted EPS above: Merger, acquisition, and divestiture-related expenses1 0.07 0.11 0.16 0.32 Business divestiture-related losses and impairment of goodwill1 — 0.20 0.09 0.20 LHX NeXt implementation costs1 0.21 0.25 0.39 0.92 Income taxes on above adjustments and other, net2 0.06 (0.08 ) 0.06 (0.20 ) Non-GAAP diluted EPS2 $ 2.78 $ 2.40 $ 5.18 $ 4.64 Less: per share impact of: FAS/CAS operating adjustment3 (0.01 ) (0.03 ) (0.03 ) (0.06 ) Non-service FAS pension income3 (0.35 ) (0.39 ) (0.77 ) (0.79 ) Pension adjusted non-GAAP diluted EPS $ 2.42 $ 1.98 $ 4.38 $ 3.79 1Refer to Key Terms and Non-GAAP Definitions on page 16. 2Second quarter 2024 amount updated to exclude adjustment of $1.13 per share and $0.29 per share for amortization of acquisition-related intangible assets and related income tax expense, respectively. Year to date 2024 amount updated to exclude adjustment of $2.26 per share and $0.60 per share for amortization of acquistion-related intangible assets and related income tax expense, respectively. 3Net of tax effect. Table 8 - Reconciliation of Net Cash Provided by Operating Activities to Adjusted Free Cash Flow (Unaudited) Second Quarter Year to Date ($ millions) 2025 2024 2025 2024 Net cash provided by operating activities $ 640 $ 754 $ 598 $ 650 Capital expenditures (88 ) (97 ) (147 ) (212 ) Proceeds from disposal of property, plant and equipment, net 9 — 9 — Free cash flow 561 657 460 438 Cash used for merger, acquisition and severance1 13 57 42 120 Adjusted free cash flow $ 574 $ 714 $ 502 $ 558 1Refer to Key Terms and Non-GAAP Definitions on page 16. Key Terms and Non-GAAP Definitions Description Definition Merger, acquisition, and divestiture-related expenses Transaction and integration expenses associated with the AJRD acquisition; external costs related to pursuing acquisition and divestiture portfolio optimization; non-transaction costs related to divestitures; and salaries of employees in roles dedicated to planned divestiture and acquisition activity. Business divestiture-related losses and impairment of goodwill In 2024, includes loss on sale and impairment of goodwill recognized in connection with the sale of our antenna and related businesses and a loss associated with the then pending divestiture of our Commercial Aviation Solutions business. In 2025, includes loss recognized in connection with the sale of our Commercial Aviation Solutions business. LHX NeXt implementation costs Costs related to the LHX NeXt initiative are expected to continue into 2026 and are expected to include workforce optimization costs and incremental IT expenses for implementation of new systems, third-party consulting expenses and other related costs, including costs related to personnel dedicated to this project. Organic revenue* Excludes the impact of completed divestitures and is reconciled in Table 4. Orders Total value of funded and unfunded contract awards received from the U.S. Government and other customers, including incremental funding and adjustments to previous awards, excluding unexercised contract options and potential orders under ordering-type contracts, such as indefinite delivery, indefinite quantity (IDIQ) contracts. Non-GAAP income before income taxes* Represents income before income taxes adjusted for items reconciled in Table 6. Effective tax rate on non-GAAP income* Represents the effective tax rate (tax expense as a percentage of income before income taxes) adjusted for the tax effect of items reconciled in Table 6. Adjusted segment operating income and margin* On a consolidated basis represents operating income and margin, excluding unallocated corporate department items and items reconciled in Table 5. Non-GAAP diluted EPS* Represents EPS (earnings per share attributable to common shareholders) adjusted for items reconciled in Table 7. Pension adjusted non-GAAP diluted EPS* Represents Non-GAAP diluted EPS, described above, adjusted for the after tax per share impact of the FAS/CAS operating adjustment and Non-service FAS pension income reconciled in Table 7. Adjusted free cash flow* Net cash provided by operating activities less capital expenditures, plus proceeds from disposal of property, plant and equipment and cash used for merger, acquisition and severance reconciled in Table 8. Cash used for merger, acquisition, and severance* Cash related to merger, acquisition and divestiture-related expenses (described above) and severance costs included in LHX NeXt implementation costs. _____ *Refer to Non-GAAP Financial Measures on page 7 for more information. View source version on Contacts Investor Relations Contact: Daniel Gittsovich, 321-724-3170investorrelations@ Media Relations Contact: Sara Banda, 321-306-8927media@
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Raises Full-Year Guidance Financial results from Operations for second quarter 2025 versus second quarter 2024: Revenue: $3.53 billion versus $3.22 billion Diluted EPS: $2.84 versus $2.43 Adjusted EPS: $4.35 versus $3.94 Raised Enterprise Revenue, Adjusted EPS and Free Cash Flow guidance: Revenue guidance narrowed to 7.5% to 8.6%; midpoint raised by 70 basis points Adjusted EPS range narrowed to $16.05 to $16.50; midpoint raised by $0.23 Free Cash Flow range of $1.13 billion to $1.28 billion; midpoint raised by $25 million Broadened our partnerships with hospitals, health systems and regional/local labs and enhanced access to comprehensive testing and laboratory services Introduced several new tests in high-growth specialty areas including oncology BURLINGTON, N.C., July 24, 2025 /PRNewswire/ -- Labcorp (NYSE: LH), a global leader of innovative and comprehensive laboratory services, today announced results for the second quarter ended June 30, 2025 and raised full-year guidance. "Labcorp had a very strong second quarter, delivering double-digit topline growth, while expanding margins across both segments," said Adam Schechter, chairman and CEO of Labcorp. "We brought innovative tests to market, and applied our leadership in science and technology to drive growth, enhance the customer experience and improve our operations. We remain committed to delivering sustained value to our customers, employees and shareholders as we execute on our long-term strategy. Based upon our performance in the first half and our momentum going into the second half of the year, we're raising our guidance." In the second quarter, Labcorp advanced its position as a partner of choice for hospitals, health systems and regional/local laboratories: Announced an agreement to acquire select assets of Incyte Diagnostics' clinical and anatomic pathology testing businesses in the Pacific Northwest. Continued to progress the acquisition of select oncology and clinical testing assets from BioReference Health. Subsequent to quarter end, Labcorp announced an agreement to acquire select assets of the outreach business from Community Health Systems across 13 states. Labcorp also continued to incorporate the power of science, innovation and technology across the organization during or subsequent to the quarter: Expanded its oncology portfolio with key launches including Labcorp® Plasma Detect™, a liquid biopsy test that assesses colon cancer recurrence risk and PGDx elio® plasma focus™ Dx, the first-and-only FDA-authorized pan-solid tumor liquid biopsy test for targeted treatment guidance. Continued to advance its leading position in Alzheimer's disease, and plans in the coming weeks to offer Fujirebio FDA-cleared biomarker test that aids in diagnosing the disease. Expanded its consumer offerings by launching several consumer-initiated tests through Labcorp OnDemand, including tests that measure an individual's cortisol and leptin levels, and introducing a new and improved Ovia app, providing women with a single platform to support their health journey. Introduced Labcorp Whole Health Solutions for functional medicine, integrative medicine and primary care practices. The solution offers specialized test panels and a test menu of more than 1,000 scientifically backed biomarkers. Added digital pathology capabilities in Central Labs, including advanced image scanning to preserve critical sample data and AI-powered solutions to provide analysis on large datasets instantly. On July 10, 2025, the company announced a quarterly cash dividend of $0.72 per share of common stock, payable on September 11, 2025, to stockholders of record at the close of business on August 28, 2025. In the quarter, Labcorp repurchased $200 million of common stock. Additionally, Labcorp raised 2025 guidance for enterprise revenue, adjusted EPS and free cash flow primarily driven by currency, as well as the underlying strength of its businesses. LABCORP HOLDINGS INC. AND SUBSIDIARIES CONSOLIDATED RESULTS Three Months Ended June 30,Six Months Ended June 30,20252024Delta20252024Delta Revenue Summary (Dollars in billions) Total Revenue $ 3.53$ 3.229.5 %$ 6.87$ 6.407.4 % Organic(1) 5.4 %3.7 % Acquisitions, net of Divestitures 3.5 %3.6 % Foreign Exchange 0.6 %0.1 % (1) Organic revenue is no longer broken out between the Base Business and COVID-19 Summary (Dollars in millions, except per share data) Operating Income ("OI") $ 394.5$ 294.8$ 720.5$ 616.1 OI as % of Revenue 11.2 %9.2 %200 bps10.5 %9.6 %90 bps Adjustments (2) $ 137.1$ 185.1$ 280.1$ 316.6 Adjusted Operating Income ("AOI") (3) $ 531.6 (4) $ 479.9$ 1,000.6$ 932.7 AOI as % of Revenue 15.1 % (5) 14.9 %20 bps14.6 %14.6 %— bps Net Earnings Attributable to Labcorp Holdings Inc. $ 237.9$ 205.3$ 450.7$ 433.3 Diluted EPS $ 2.84$ 2.43$ 5.36$ 5.13 Adjusted EPS (3) $ 4.35$ 3.9410.4 %$ 8.19$ 7.627.5 % (2) Adjustments include amortization, impairment charges, restructuring charges, and special items. (3) Non-GAAP financial measure. See "Reconciliation of Non-GAAP Measures" for additional information. (4) The increase in adjusted operating income was due to organic demand as the company leveraged well on revenue growth. (5) Adjusted operating margin was constrained by Invitae. LABCORP HOLDINGS INC. AND SUBSIDIARIES CONSOLIDATED RESULTSThree Months Ended June 30,Six Months Ended June 30,2025202420252024 Cash Flow Summary (Dollars in millions)Operating Cash Flow $ 620.6$ 561.1$ 639.1$ 531.3 Capital Expenditures 77.9128.2203.9262.0 Free Cash Flow $ 542.7 (1) $ 432.9$ 435.2$ 269.3 (1) The increase in free cash flow was driven by higher earnings and the timing of capital expenditures. Capital Allocation Summary At the end of the quarter, Labcorp's cash and cash equivalents balance was $0.65 billion and total debt was $5.58 billion. During the quarter, the company invested $25.0 million in acquisitions and partnerships, paid out $59.9 million in dividends, and repurchased $200.0 million of stock. LABCORP HOLDINGS INC. AND SUBSIDIARIES Diagnostics Laboratories Segment Summary Three Months Ended June 30,20252024Delta Revenue Summary (Dollars in billions) Total Revenue $ 2.75$ 2.528.9 % Organic(1) 4.5 % Acquisitions, net of Divestitures 4.5 % Foreign Exchange (0.1 %) (1) Organic revenue is no longer broken out between the Base Business and COVID-19 Testing. Earnings Summary (2) (Dollars in millions) Adjusted Operating Income ("AOI") (3) $ 482.8$ 441.5 AOI as % of Revenue 17.6 % (4) 17.5 %10 bps (2) Non-GAAP financial measure. See "Reconciliation of Non-GAAP Measures" for additional information. (3) Excludes amortization, restructuring charges, special items, and unallocated corporate expenses. (4) Adjusted operating margin was constrained by Invitae. Three Months Ended June 30, 2025 RequisitionPrice/Mix Volume Delta (5)Delta (5) Metrics Summary Total4.9 %4.0 % Organic (6)3.4 %1.1 % Acquisitions, net of Divestitures1.5 %3.0 % Foreign Exchange— %(0.1) %(5) Column shows changes versus the three months ended June 30, 2024. (6) Organic price/mix includes lab management agreements. LABCORP HOLDINGS INC. AND SUBSIDIARIES Biopharma Laboratory Services Segment Summary Three Months Ended June 30,20252024DeltaRevenue Summary (Dollars in millions)Total Revenue$ 784.8$ 707.011.0 % (1) Organic7.8 %Foreign Exchange3.2 %(1) Early Development revenue growth of 20.4%, Central Labs revenue growth of 7.5%. Earnings Summary (2) (Dollars in millions)Adjusted Operating Income ("AOI") (3)$ 123.3 (4) $ 107.4AOI as % of Revenue15.7 %15.2 %50 bps (4) (2) Non-GAAP financial measure. See "Reconciliation of Non-GAAP Measures" for additional information. (3) Excludes amortization, restructuring charges, special items, and unallocated corporate expenses. (4) Adjusted operating income and margin increase was primarily driven by organic demand and operating efficiencies. As of June 30, 2025Metrics Summary (Dollars in billions) TTM Net Orders $ 3.34TTM Book to Bill 1.11Backlog $ 8.71 (5) Next Twelve Months Forecast Backlog Conversion $ 2.71 (5) Backlog increased 10.0% compared to this period last year. Guidance for 2025 Labcorp is updating 2025 full year guidance to reflect its second quarter performance and full year outlook. The following guidance assumes foreign exchange rates effective as of June 30, 2025, for the remainder of the year. Enterprise level guidance includes the estimated impact from currently anticipated capital allocation, including acquisitions, share repurchases and dividends. (Dollars in billions, except per share data) PreviousUpdatedResults2025 Guidance2025 Guidance2024Low HighLow High RevenueLabcorp Enterprise (1)(2) $13.016.7 % 8.0 %7.5 % 8.6 % Diagnostics Laboratories(3) $10.146.5 % 7.7 %7.0 % 8.0 % Biopharma Laboratory Services (4) $2.923.0 % 5.0 %6.1 % 7.5 % Adjusted EPS $14.57$15.70 $16.40$16.05 $16.50 Free Cash Flow $1.10$1.10 $1.25$1.13 $1.28 (1) 2025 Guidance includes an impact from foreign currency translation of 0.5%. (2) Enterprise level revenue is presented net of intersegment transaction eliminations. (3) 2025 Guidance includes an impact from foreign currency translation of (0.1%). (4) 2025 Guidance includes an impact from foreign currency translation of 2.5%.Use of Adjusted Measures The company has provided in this press release and accompanying tables "adjusted" financial information that has not been prepared in accordance with GAAP, including adjusted net income, adjusted EPS (or adjusted net income per share), adjusted operating income, adjusted operating margin, free cash flow, and certain segment information. The company believes these adjusted measures are useful to investors as a supplement to, but not as a substitute for, GAAP measures, in evaluating the company's operational performance. The company further believes that the use of these non-GAAP financial measures provides an additional tool for investors in evaluating operating results and trends, and growth and shareholder returns, as well as in comparing the company's financial results with the financial results of other companies. However, the company notes that these adjusted measures may be different from and not directly comparable to the measures presented by other companies. Reconciliations of these non-GAAP measures to the most comparable GAAP measures and an identification of the components that comprise "special items" used for certain adjusted financial information are included in the tables accompanying this press release. The company today is providing an investor relations presentation with additional information on its business and operations, which is available in the investor relations section of the company's website at Analysts and investors are directed to the website to review this supplemental information. A conference call discussing Labcorp's quarterly results will be held today at 9:00 a.m. ET and is available by registering at this link, which will provide a dial-in number and unique PIN to access the call. It is recommended that participants join 10 minutes prior to the start of the call, although participants may register and join at any time during the call. A live webcast of Labcorp's quarterly conference call on July 24, 2025, will be available at the Labcorp Investor Relations website beginning at 9:00 a.m. ET. This webcast will be archived and accessible through July 11, 2026. About Labcorp Labcorp (NYSE: LH) is a global leader of innovative and comprehensive laboratory services that helps doctors, hospitals, pharmaceutical companies, researchers and patients make clear and confident decisions. We provide insights and advance science to improve health and improve lives through our unparalleled diagnostics and drug development laboratory capabilities. The company's nearly 70,000 employees serve clients in approximately 100 countries, provided support for 75% of the new drugs and therapeutic products approved in 2024 by the FDA, and performed more than 700 million tests annually for patients around the world. Learn more about us at Cautionary Statement Regarding Forward-Looking Statements This press release contains forward-looking statements, including, but not limited to, statements with respect to (i) the estimated 2025 guidance and related assumptions, (ii) the impact of various factors on operating and financial results, including the projected impact of global economic and market conditions on the company's businesses, operating results, cash flows and/or financial condition, (iii) future business strategies, (iv) expected savings, synergies and other benefits to the Company, customers or patients from acquisitions and other transactions and partnerships, and (v) opportunities for future growth. Each of the forward-looking statements is subject to change based on various important factors, many of which are beyond the company's control, including without limitation: (i) the effect of the holding company reorganization on the company's business generally; (ii) the failure to receive tax-free treatment with respect to the spin-off of the company's Clinical Development and Commercialization Services business, now Fortrea Holdings Inc. for U.S. federal income purposes; (iii) the impact of spin-off related items; (iv) personnel costs and potential difficulties with employee relations and retention; (v) the trading price of the company's stock, competitive actions and other unforeseen changes and general uncertainties in the marketplace; (vi) changes in government regulations, including healthcare reform; (vii) customer purchasing decisions, including changes in payer regulations or policies; (viii) adverse actions of governmental and third-party payers; (ix) changes in testing guidelines or recommendations; (x) the volume of COVID-19 Testing performed by the company; (xi) the impact of global geopolitical events; (xii) the effect of public opinion on the company's reputation; (xiii) adverse results in material litigation matters; (xiv) changes in laws and regulations applicable to the company, including healthcare reform, and changes to their interpretation and application and the impact of any such changes; (xv) failure to maintain or develop customer relationships; (xvi) the company's ability to develop or acquire new products and adapt to technological changes; (xvii) failure of the company's information technology, systems, or data security; (xviii) the impact of potential losses under repurchase agreements; (xix) adverse weather conditions; (xx) the number of revenue days in a financial period; (xxi) inflation; (xxii) increased competition; and (xxiii) the effect of exchange rate fluctuations. These factors, in some cases, have affected and in the future (together with other factors) could affect the company's ability to implement the company's business strategy, and actual results could differ materially from those suggested by these forward-looking statements. As a result, readers are cautioned not to place undue reliance on any of the forward-looking statements. The company has no obligation to provide any updates to these forward-looking statements even if its expectations change. All forward-looking statements are expressly qualified in their entirety by this cautionary statement. Further information on potential factors, risks and uncertainties that could affect operating and financial results is included in the company's most recent Annual Report on Form 10-K under the heading RISK FACTORS and in the company's other filings with the SEC. The information in this press release should be read in conjunction with a review of the company's filings with the SEC including the information in the company's most recent Annual Report on Form 10-K under the heading "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS". - End of Text - - Tables to Follow - LABCORP HOLDINGS INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In Millions, Except Per Share Data) Three Months Ended June 30,Six Months Ended June 30,2025202420252024 Revenues $ 3,527.3$ 3,220.9$ 6,872.4$ 6,397.5 Cost of revenues 2,481.12,294.54,878.24,573.8 Gross profit 1,046.2926.41,994.21,823.7 Selling, general, and administrative expenses 579.3557.81,125.31,066.2 Amortization of intangibles and other assets 68.362.2137.9122.3 Goodwill and other asset impairments ———2.5 Restructuring and other charges 4.111.610.516.6 Operating income 394.5294.8720.5616.1 Other (expense) income:Interest expense (57.1)(47.6)(113.1)(94.5) Investment income 1.71.38.24.2 Equity method loss, net (1.7)(0.3)(2.0)(0.2) Other, net (32.7)19.5(33.7)39.5 Earnings from operations before income taxes 304.7267.7579.9565.1 Provision for income taxes 66.462.1128.6131.2 Net earnings 238.3205.6451.3433.9 Less: Net earnings attributable to the noncontrolling interest (0.4)(0.3)(0.6)(0.6) Net earnings attributable to Labcorp Holdings Inc. $ 237.9$ 205.3$ 450.7$ 433.3 Earnings per common share:Basic earnings per common share $ 2.85$ 2.44$ 5.40$ 5.15 Diluted earnings per common share $ 2.84$ 2.43$ 5.36$ 5.13 Weighted-average basic common shares outstanding 83.484.183.584.1 Weighted-average diluted common shares outstanding 83.984.384.184.5 LABCORP HOLDINGS INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In Millions) June 30, 2025December 31, 2024 ASSETSCurrent assets:Cash and cash equivalents $ 647.3$ 1,518.7 Accounts receivable, net 2,120.61,944.1 Unbilled services 156.1152.9 Supplies inventory 508.1493.2 Prepaid expenses and other 655.1697.6 Total current assets 4,087.24,806.5 Property, plant, and equipment, net 3,133.83,045.4 Goodwill, net 6,551.16,369.7 Intangible assets, net 3,494.43,488.9 Joint venture partnerships and equity method investments 160.416.3 Other assets, net 633.0652.2 Total assets $ 18,059.9$ 18,379.0 LIABILITIES AND SHAREHOLDERS' EQUITYCurrent liabilities:Accounts payable $ 793.0$ 875.8 Accrued expenses and other 835.8871.2 Unearned revenue 398.0392.2 Short-term operating lease liabilities 186.1184.6 Short-term finance lease liabilities 4.36.1 Short-term borrowings and current portion of long-term debt 499.61,000.3 Total current liabilities 2,716.83,330.2 Long-term debt 5,077.35,331.2 Operating lease liabilities 713.1676.3 Financing lease liabilities 65.674.3 Deferred income taxes and other tax liabilities 354.5383.1 Other liabilities 643.2517.4 Total liabilities 9,570.510,312.5 Commitments and contingent liabilitiesNoncontrolling interest 16.714.3 Shareholders' equity:Common stock, 82.9 and 83.4 shares outstanding at June 30, 2025, and December 31, 2024, respectively 7.57.6 Additional paid-in capital 1.82.8 Retained earnings 8,498.08,303.4 Accumulated other comprehensive loss (34.6)(261.6) Total shareholders' equity 8,472.78,052.2 Total liabilities and shareholders' equity $ 18,059.9$ 18,379.0 LABCORP HOLDINGS INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In Millions) Three Months Ended June 30,Six Months Ended June 30,2025202420252024 CASH FLOWS FROM OPERATING ACTIVITIES:Net earnings $ 238.3$ 205.6$ 451.3$ 433.9 Adjustments to reconcile net earnings to net cash provided by operating activities:Depreciation and amortization 170.3156.9337.1311.4 Stock compensation 34.130.866.962.4 Operating lease right-of-use asset expense 50.844.599.488.6 Goodwill and other asset impairments ———2.5 Deferred income taxes (6.1)(19.6)(12.2)(39.1) Other, net 38.039.646.136.6 Change in assets and liabilities (net of effects of acquisitions and divestitures):Decrease (increase) in accounts receivable 30.9(5.1)(139.9)(192.2) Decrease (increase) in unbilled services 0.9(37.1)4.826.8 (Increase) decrease in supplies inventory (11.9)28.3(3.5)27.7 Decrease in prepaid expenses and other 12.846.557.821.6 Increase (decrease) in accounts payable 67.069.4(80.6)(51.7) Increase (decrease) in unearned revenue 0.210.8(8.7)(30.8) Decrease in accrued expenses and other (4.7)(9.5)(179.4)(166.4) Net cash provided by operating activities 620.6561.1639.1531.3 CASH FLOWS FROM INVESTING ACTIVITIES:Capital expenditures (77.9)(128.2)(203.9)(262.0) Proceeds from sale of assets 1.90.12.40.2 Proceeds from sale or distribution of equity affiliates or other investments 6.9—6.9— Proceeds from sale of business ———13.5 Purchase of equity affiliates or other investments (15.0)(23.0)(172.0)(36.7) Acquisition of businesses, net of cash acquired (10.0)(33.9)(63.5)(293.1) Net cash used for investing activities (94.1)(185.0)(430.1)(578.1) CASH FLOWS FROM FINANCING ACTIVITIES:Payments on senior notes ——(1,000.0)— Proceeds from revolving credit facilities —698.764.8951.9 Payments on revolving credit facilities —(721.3)(64.8)(932.1) Proceeds from accounts receivable securitization ——225.0— Net share settlement tax payments from issuance of stock to employees (3.5)(23.1)(29.0)(37.8) Net proceeds from issuance of stock to employees ——25.726.7 Dividends paid (59.9)(60.4)(121.5)(122.5) Purchase of common stock (200.0)(100.0)(200.0)(100.0) Other, net (4.0)(3.9)(7.3)(7.9) Net cash used for financing activities (267.4)(210.0)(1,107.1)(221.7) Effect of exchange rate changes on Cash and cash equivalents 18.8(0.3)26.7(3.2) Net increase (decrease) in Cash and cash equivalents 277.9165.8(871.4)(271.7) Cash and cash equivalents at beginning of period 369.499.31,518.7536.8 Cash and cash equivalents at end of period $ 647.3$ 265.1$ 647.3$ 265.1 LABCORP HOLDINGS INC. AND SUBSIDIARIES Condensed Combined Non-GAAP Segment Information (Dollars in Millions) Three Months Ended June 30,Six Months Ended June 30,2025202420252024 Diagnostics LaboratoriesRevenues $ 2,748.8$ 2,524.9$ 5,378.4$ 5,004.6 Adjusted operating income $ 482.8$ 441.5$ 910.3$ 859.4 Adjusted operating margin 17.6 %17.5 %16.9 %17.2 % Biopharma Laboratory ServicesRevenues $ 784.8$ 707.0$ 1,506.1$ 1,417.9 Adjusted operating income $ 123.3$ 107.4$ 230.2$ 207.3 Adjusted operating margin 15.7 %15.2 %15.3 %14.6 % ConsolidatedRevenues $ 3,527.3$ 3,220.9$ 6,872.4$ 6,397.5 Adjusted segment operating income $ 606.1$ 548.9$ 1,140.5$ 1,066.7 Unallocated corporate expense (74.5)(69.0)$ (139.9)$ (134.0) Consolidated adjusted operating income $ 531.6$ 479.9$ 1,000.6$ 932.7 Adjusted operating margin 15.1 %14.9 %14.6 %14.6 % The consolidated revenue and adjusted segment operating income are presented net of intersegment transaction eliminations and other amounts not used in determining segment performance. Adjusted operating income and adjusted operating margin are non-GAAP measures. See the subsequent reconciliation of non-GAAP financial measures. LABCORP HOLDINGS INC. AND SUBSIDIARIES Reconciliation of Non-GAAP Measures (Dollars and Shares in Millions, Except Per Share Data) Three Months Ended June 30,Six Months Ended June 30, 2025202420252024Adjusted Operating Income Operating income$ 394.5$ 294.8$ 720.5$ 616.1 Amortization of intangibles and other assets (a)68.362.2137.9122.3 Restructuring and other charges (b)4.111.610.516.6 Acquisition and disposition-related costs (c)15.125.144.246.0 Launchpad costs (d)17.231.537.340.4 Asset impairments (e)———2.5 Other31.931.846.443.5 TSA reimbursement (f)0.522.93.845.3 Adjusted operating income$ 531.6$ 479.9$ 1,000.6$ 932.7Adjusted operating profit margin15.1 %14.9 %14.6 %14.6 %Adjusted Net Income Net income$ 237.9$ 205.3$ 450.7$ 433.3 Impact of adjustments to operating income137.1185.1280.1316.6 Loss on venture fund investments, net (g)32.71.536.15.7 Gain on sale of business (h)———(4.9) TSA reimbursement (f)(0.5)(22.9)(3.8)(45.3) Other 0.70.30.70.3 Income tax impact of adjustments (i)(43.4)(37.3)(75.3)(61.5) Adjusted net income$ 364.5$ 332.0$ 688.5$ 644.2Weighted-average diluted common shares outstanding83.984.384.184.5Adjusted net income per share$ 4.35$ 3.94$ 8.19$ 7.62 (a) Amortization of intangible assets acquired as part of business acquisitions. (b) Restructuring and other charges represent amounts incurred in connection with the elimination of redundant positions and facilities and contract termination costs within the organization in connection with our LaunchPad initiatives, and acquisitions or dispositions of businesses by the company. (c) Acquisition and disposition-related costs include due-diligence legal and advisory fees, retention bonuses, impact of delayed contract or license transfers, and other integration or disposition related activities. (d) LaunchPad costs include non-capitalized costs associated with the implementation of systems, consolidation of processes, and consulting costs incurred as part of various business process improvement initiatives. (e) The company impaired certain fixed assets which are no longer realizable by the business. (f) Represents transition services fees charged to Fortrea Holdings Inc. related to administrative and IT systems support. The costs to provide these services are included in operating income but the service fees are included in other income. (g) The company makes investments in companies or investment funds developing promising technology related to its operations. The company recorded net gains and losses related to several distributions from venture funds, increases in the market value of investments, and impairments of other investments due to the underlying performance of the investments. (h) The company recorded a gain on the disposition of the Beacon Laboratory Benefits Solutions business. (i) Income tax impact of adjustments calculated based on the tax rate applicable to each item. View original content to download multimedia: SOURCE Labcorp Holdings Inc
