Thermo Fisher Q2 Earnings & Revenues Beat, Stock Up in Pre-Market
The adjusted number excludes certain expenses, including asset amortization costs and certain restructuring costs.
GAAP EPS was $4.28, up 6% on a year-over-year basis.
Following the earnings announcement, shares of TMO rose 7.7% in pre-market trading today.
TMO's Q2 Revenues in Detail
Revenues in the quarter increased 2.9% year over year to $10.85 billion. Moreover, the top line surpassed the Zacks Consensus Estimate by 1.9%.
Organic revenues in the reported quarter increased 2% year over year.
Thermo Fisher's Segmental Analysis
Thermo Fisher operates under four business segments, as discussed below:
Life Sciences Solutions
Revenues in the Life Sciences Solutions segment (23% of total revenues) increased 6.1% year over year to $2.50 billion. The number surpassed our model's estimate of $2.37 billion.
Analytical Instruments
Revenues in this segment (15.9%) declined 3% year over year to $1.73 billion. The figure missed our model's estimate of $1.84 billion.
Specialty Diagnostics
Revenues in the Specialty Diagnostics segment (10.4%) increased 1.5% year over year to $1.13 billion. The number missed our model's prediction of $1.15 billion.
Laboratory Products and Biopharma Services
Revenues in this segment (55.2%) rose 4.1% year over year to $5.99 billion. Our model's estimate was $5.71 billion. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
TMO's Margin Performance
Gross margin of 41.2% in the second quarter contracted 83 basis points (bps) year over year due to a 4.4% increase in the cost of revenues.
In the quarter, selling, general and administrative expenses rose 5.4% to $1.78 billion. Research and development expenses increased 3.8% to $352 million.
The adjusted operating margin in the quarter was 21.6%, reflecting a contraction of 124 bps.
Thermo Fisher Scientific Inc. Price, Consensus and EPS Surprise
TMO's Financial Position
The company ended the second quarter of 2025 with cash and cash equivalents and short-term investments of $6.39 billion compared with $5.95 billion at the end of the first quarter of 2025.
Cumulative net cash from operating activities at the end of the second quarter was $2.12 billion compared with $3.21 billion a year ago.
Thermo Fisher has a consistent dividend-paying history, with the five-year annualized dividend growth of 14.86%.
Our Take on Thermo Fisher Stock
Thermo Fisher exited the second quarter of 2025 with better-than-expected results, wherein both earnings and revenues beat the respective estimates. Barring the Analytical Instruments segment, all other business segments reported growth during the quarter. However, contraction of both margins in the quarter was discouraging. The company will provide its 2025 guidance on the earnings call today.
During the second quarter, the company advanced in its growth strategy by launching a range of next-generation, high-impact, innovative instruments, including the Thermo Scientific Orbitrap Astral Zoom mass spectrometer, the Thermo Scientific Orbitrap™ Excedion Pro mass spectrometer and the Thermo Scientific Krios 5 Cryo-TEM. These instruments help researchers deepen the understanding of complex diseases, advance precision medicine and enable the development of new therapies. In addition, TMO expanded the DynaDrive single-use bioreactor portfolio for drug production to include a new first-of-its-kind bench-scale system, enabling meaningful workflow efficiencies and seamless scale-up from the bench to commercialization. All these developments translated into meaningful commercial wins for the company in the second quarter, which is encouraging.
TMO's Zacks Rank & Key Picks
Thermo Fisher currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader medical space are Intuitive Surgical ISRG, Veeva Systems VEEV and Boston Scientific BSX.
Intuitive Surgical, sporting a Zacks Rank #1 (Strong Buy) at present, posted first-quarter 2025 adjusted EPS of $1.81, which exceeded the Zacks Consensus Estimate by 5.9%. Revenues of $2.25 billion surpassed the Zacks Consensus Estimate by 3.3%. You can see the complete list of today's Zacks #1 Rank stocks here.
ISRG has an estimated long-term earnings growth rate of 15.1% compared with the industry's 14.4%. The company's earnings surpassed estimates in each of the trailing four quarters, the average surprise being 14.6%.
Veeva Systems, currently carrying a Zacks Rank #2 (Buy), reported first-quarter fiscal 2026 adjusted EPS of $1.97, which surpassed the Zacks Consensus Estimate by 13.2%. Revenues of $759 million beat the consensus mark by 4.3%.
VEEV has an estimated long-term earnings growth rate of 23.3% compared with the industry's 19.1%. The company beat on earnings in each of the trailing four quarters, the average surprise being 10%.
Boston Scientific, carrying a Zacks Rank #2 at present, reported a first-quarter 2025 adjusted EPS of 75 cents, which beat the Zacks Consensus Estimate by 0.1%. Revenues of $4.66 billion topped the Zacks Consensus Estimate by 20.9%.
BSX has a long-term earnings growth rate of 13.2% compared with the industry's 13.9%. The company's earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.8%.
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in the coming year. While not all picks can be winners, previous recommendations have soared +112%, +171%, +209% and +232%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.
Boston Scientific Corporation (BSX): Free Stock Analysis Report
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