(Reuters) - Laboratory Corporation of America (NYSE:LH) topped Wall Street expectations for quarterly adjusted profit on Thursday, as strength in its routine diagnostics business more than offset weak COVID test sales.
U.S. lab testing companies including Labcorp rival Quest Diagnostics (NYSE:DGX) have seen a rebound in routine test volumes with people returning for regular health checkups that had been deferred during the pandemic.
Peer Danaher (NYSE:DHR) also beat profit expectations earlier this week on the back of strong demand for its diagnostic tests for respiratory diseases.
Labcorp's diagnostics unit generated revenue of $2.34 billion in the quarter ended Sept. 30, up more than 6% from a year earlier, beating estimates of $2.26 billion, according to LSEG data.
The company now expects its diagnostics business, excluding COVID test sales, to grow between 14.1% and 14.6% in 2023, compared with 13.2% to 14.2% growth it had forecast earlier.
Labcorp said it expects COVID test sales, which had bolstered the company's performance for nearly two years during the pandemic, to drop 85% to 86% this year, compared with previous expectations of an 85% to 89% decline.
Labcorp reported adjusted profit of $3.38 per share, beating analysts' average estimate of $3.33 per share.
The life sciences company also tightened its annual profit per share outlook to between $13.25 and $13.75, from $13 to $14 forecast earlier. Analysts on average estimate earnings per share of $13.63, according to LSEG data.