Quest Diagnostics Boosts Annual Outlook Amid Strong Testing Demand

• Quest's Diagnostic Information Services revenue rose 9.4% year-over-year to $2.83 billion, with organic requisition volumes up 10.8%, though revenue per test fell 1.3%
• First-quarter revenue reached $2.90 billion versus analyst estimates of $2.83 billion, with adjusted profit of $2.50 per share beating expectations
• The company reported double-digit revenue growth in advanced diagnostics including Alzheimer's blood tests and cardiometabolic testing, though analysts caution new hospital contracts may pressure margins initially

Quest Diagnostics Raises 2026 Outlook on Strong Testing Demand

Quest Diagnostics increased its full-year 2026 revenue and profit guidance on Tuesday after first-quarter results exceeded Wall Street expectations, driven by resilient demand for routine diagnostic testing.

Key Financial Updates:

• Full-year revenue forecast raised to $11.78-$11.90 billion, above the analyst estimate of $11.75 billion (previously $11.70-$11.82 billion)
• Adjusted profit guidance set at $10.63-$10.83 per share
• Q1 revenue reached $2.90 billion versus analyst expectations of $2.83 billion
• Q1 adjusted earnings came in at $2.50 per share

Operational Highlights:

Quest's Diagnostic Information Services segment, its largest business unit, posted Q1 revenue of $2.83 billion, up 9.4% year-over-year. The growth was fueled by a 10.8% increase in organic requisition volumes. However, the average revenue per test declined 1.3% in the quarter ended March 31.

The company reported double-digit revenue growth in advanced diagnostics, particularly in blood tests for Alzheimer's disease detection and cardiometabolic and endocrine condition testing.

Market Context:

U.S. diagnostic testing providers are adjusting to post-pandemic conditions by focusing on routine testing and hospital laboratory management contracts to maintain volumes. The industry faces ongoing challenges from reimbursement pressures and elevated labor costs.

Leerink Partners analyst Michael Cherny noted that Quest should benefit from expanded contracts and hospital deals, though some agreements may temporarily pressure margins during initial implementation phases.

The raised outlook signals management confidence in sustained testing demand and successful contract expansion despite industry headwinds.