Hologic Stock Falls After Q3 Revenue Dip, But It Lifts Revenue and Profit Outlook

Hologic Inc HOLX posted Q3 adjusted EPS of $0.93, down from $0.95 a year ago and beating the consensus of $0.88.

Revenue of $984.4 million decreased 1.8% Y/Y (down 1.6% on constant currency), driven by lower sales of COVID-19 assays compared to the prior year period, as expected, exceeded the company's prior guidance of $930-$980 million and the consensus of $957.13 million.

Diagnostics sales dipped by 21.5% but, excluding COVID-19-related products, grew by 11.8% on an organic, constant currency basis.

Breast Health revenue increased 27.4%, primarily due to higher capital equipment revenue than the prior year period, as an improving semiconductor chip supply environment enabled more gantry deliveries.

Surgical revenue grew 13.9%, primarily driven by results from the company's hysteroscopic portfolio.

Non-GAAP gross margin of 60.8% decreased (250) basis points, while Non-GAAP operating margin of 28.9% decreased (340) basis points.

Guidance: For FY23, Hologic projects revenue of $3.995 - $4.035 billion, compared to $3.925-$4.025 expected earlier and the consensus of $4.02 billion.

It expects adjusted EPS of $3.87-$3.94 versus the consensus of $3.91 and earlier guidance of $3.75-$3.95.

For Q4 FY23, Hologic sees revenues of $910-$950 million and adjusted EPS of $0.80-$0.87 compared to the consensus of $951.07 million and $0.87, respectively.

Price Action: HOLX shares are down 3.27% at $76.82 on the last check Tuesday.