Thermo Fisher Cuts Annual Profit Outlook Again on Weak Biotech Demand

Cam White | October 25, 2023

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(Reuters) -Thermo Fisher Scientific on Wednesday cut its annual profit forecast for the second straight quarter following weak demand for its services used to make therapies and vaccines as well as higher raw material costs for the year.

The medical equipment maker’s shares fell about 2% in premarket trading as it forecast annual adjusted profit of $21.50 per share, compared with its previous outlook of $22.28 to $22.72 per share.

The impact of the macroeconomic conditions that the industry has experienced through the year increased in the third quarter, Thermo Fisher said.

The company has been expanding its range of services through deals in recent years, in a bid to become a one-stop shop for its biotech and large pharmaceutical clients.

Thermo Fisher and rival Danaher have previously warned of soft demand for their bioprocessing services used to make therapies and vaccines, as biotechs become more cautious about their drug development spending.

Danaher said on Tuesday it expects a slight decline in adjusted core sales for the year, compared with its previous forecast of a low single-digit rise.

Thermo Fisher also cut its revenue expectations for the year to $42.7 billion, from its previous outlook of $43.4 billion to $44 billion.

Analysts were expecting full-year adjusted profit of $22.28 per share and revenue of $43.49 billion, according to LSEG data.

The company reported third-quarter revenue of $10.57 billion, missing analysts’ estimates of $10.60 billion.

On an adjusted basis, Thermo Fisher earned $5.69 per share, beating estimates of $5.61.

(Reporting by Bhanvi Satija in Bengaluru; Editing by Shinjini Ganguli and Shounak Dasgupta)