Quest Diagnostics Reports Second Quarter 2026 Financial Results; Raises Revenue and EPS Guidance for Full Year 2026
Rhea-AI Summary
Quest Diagnostics (NYSE: DGX) reported second quarter 2026 net revenues of $3.04 billion, up 10.2% year over year, driven by 10.0% organic revenue growth and a 13.1% increase in requisition volume. Diagnostic Information Services revenues rose 10.3%.
Reported diluted EPS was $2.84, up 15.0%, while adjusted diluted EPS was $3.12, up 19.1%. Operating cash flow for the quarter was $597 million, up 9.7%. The company raised its 2026 guidance, now expecting net revenues of $11.95–$12.05 billion, reported diluted EPS of $9.97–$10.17, and adjusted diluted EPS of $11.05–$11.25. Expected 2026 cash from operations was increased to approximately $1.80 billion, with capital expenditures unchanged at about $550 million.
Positive
- Q2 2026 net revenues $3.04B, up 10.2% year over year
- Organic revenue growth 10.0% in Q2 2026
- Adjusted diluted EPS $3.12 in Q2, up 19.1% year over year
- Requisition volume up 13.1% year over year in Q2
- 2026 revenue guidance raised to $11.95B–$12.05B (8.3%–9.2% growth)
- 2026 adjusted EPS guidance raised to $11.05–$11.25
- Q2 operating cash flow $597M, up 9.7% year over year
- Expected 2026 operating cash flow increased to approximately $1.80B
Negative
- Q2 revenue per requisition declined 2.8% year over year
- Q2 reported operating margin fell 80 bps to 15.1%
- Q2 capital expenditures rose 27% year over year to $138M
- Total debt increased, with long-term debt at $5.63B vs. $5.17B
- Purchases of treasury stock used $102M cash in first half 2026
News Explained
The release uses “reported” for GAAP measures and “adjusted” for non-GAAP measures that exclude items such as restructuring and integration charges, amortization, and certain investment gains or losses.
Market reaction: DGX +7.33% on 2Q26 earnings report
Following this news, DGX has gained 7.33%, reflecting a notable positive market reaction. Argus tracked a peak move of +2.5% during the session. Our momentum scanner has triggered 26 alerts so far, indicating elevated trading interest and price volatility. The stock is currently trading at $225.22. This price movement has added approximately $1.70B to the company's valuation. Trading volume is elevated at 2.0x the average, suggesting notable buying interest.
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Key Figures
Previous Earnings Reports
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| Apr 21 | First-quarter earnings | Positive | +4.5% | Revenue and EPS growth accompanied raised full-year guidance. |
| Oct 21 | Third-quarter earnings | Positive | -3.0% | Revenue and adjusted EPS growth accompanied raised full-year guidance. |
| Jul 22 | Second-quarter earnings | Positive | +7.1% | Strong revenue, EPS, requisition volume, and cash-flow growth supported guidance increases. |
| Apr 22 | First-quarter earnings | Positive | +6.8% | Revenue, EPS, operating income, and cash-flow growth supported guidance reaffirmation. |
| Oct 22 | Third-quarter earnings | Positive | +6.8% | Revenue and adjusted EPS growth accompanied updated full-year guidance. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Four of five tag-specific earnings events had positive 24-hour reactions, while the October 2025 earnings event declined 3.03%.
Key Terms
organic revenue growth financial
gaap financial
non-gaap financial
requisition volume technical
AI-generated analysis. How Rhea-AI works. Not financial advice.
- Second quarter revenues of
$3.04 billion 10.2% from 2025, with10.0% organic revenue growth - Second quarter reported diluted earnings per share ("EPS") of
$2.84 15.0% from 2025; and adjusted diluted EPS of$3.12 19.1% from 2025 - Full year 2026 revenues now expected to be between
$11.95 billion $12.05 billion - Full year 2026 reported diluted EPS now expected to be between
$9.97 $10.17 $11.05 $11.25
"Our robust top- and bottom-line growth in the second quarter demonstrates focused execution of our strategy to connect people and providers to innovative testing and actionable insights that illuminate paths for better health," said Jim Davis, Chairman, CEO and President. "Revenues increased by over
Recent Highlights:
Serving Customers and Delivering Innovations
- Continued to advance our Co-Lab Solutions implementation and joint venture laboratory with Corewell Health in
Michigan and developed new capabilities in kidney care through our collaboration with Fresenius Medical Care inthe United States . - Generated robust revenue growth through questhealth.com and our consumer, wearable and wellness partners.
- Grew revenues by double-digits in several areas of Advanced Diagnostics, including Quest AD-Detect® blood tests for Alzheimer's disease and advanced cardiometabolic and endocrine tests, including liver fibrosis testing.
- Granted
New York State approval for our Haystack MRD® test and became the largest reference lab to utilize Flatiron Health's OncoEMR® Molecular Profiling Integration (MPI) platform for select cancer tests, including Haystack MRD, starting with a pilot with American Oncology Network (AON).
Driving Operational Excellence
- In the lab, extended automation solutions to improve quality and productivity in cervical cancer screening and front-end specimen processing to additional labs.
- Outside the lab, launched IntelliDraw™ to guide clinical staff of our physician customers through specimen collection, to enhance quality and the service experience.
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
2026 | 2025 | Change | 2026 | 2025 | Change | |||||||
(dollars in millions, except per share data) | ||||||||||||
Reported: | ||||||||||||
Net revenues | $ 3,043 | $ 2,761 | 10.2 % | $ 5,938 | $ 5,413 | 9.7 % | ||||||
Diagnostic Information Services | $ 2,978 | $ 2,699 | 10.3 % | $ 5,810 | $ 5,288 | 9.9 % | ||||||
Revenue per requisition | (2.8) % | (2.1) % | ||||||||||
Requisition volume | 13.1 % | 12.0 % | ||||||||||
Organic requisition volume | 13.0 % | 11.9 % | ||||||||||
Operating income (a) | $ 459 | $ 438 | 4.6 % | $ 858 | $ 784 | 9.4 % | ||||||
Operating income as a percentage of net | 15.1 % | 15.9 % | (0.8) % | 14.4 % | 14.5 % | (0.1) % | ||||||
Net income attributable to Quest | $ 320 | $ 282 | 13.4 % | $ 572 | $ 502 | 13.9 % | ||||||
Diluted EPS (a) | $ 2.84 | $ 2.47 | 15.0 % | $ 5.08 | $ 4.41 | 15.2 % | ||||||
Cash provided by operations | $ 597 | $ 544 | 9.7 % | $ 875 | $ 858 | 1.9 % | ||||||
Capital expenditures | $ 138 | $ 108 | 27.0 % | $ 252 | $ 225 | 12.1 % | ||||||
Adjusted (a): | ||||||||||||
Operating income | $ 502 | $ 466 | 7.8 % | $ 949 | $ 872 | 8.8 % | ||||||
Operating income as a percentage of net | 16.5 % | 16.9 % | (0.4) % | 16.0 % | 16.1 % | (0.1) % | ||||||
Net income attributable to Quest | $ 350 | $ 298 | 17.3 % | $ 631 | $ 549 | 14.9 % | ||||||
Diluted EPS | $ 3.12 | $ 2.62 | 19.1 % | $ 5.62 | $ 4.83 | 16.4 % | ||||||
(a) | For further details impacting the year-over-year comparisons related to operating income, operating income as a percentage of net revenues, net income attributable to Quest Diagnostics, and diluted EPS, see note 2 of the financial tables attached below. |
Updated Guidance for Full Year 2026
The company updates its full year 2026 guidance as follows:
Updated Guidance | Prior Guidance | ||||||
Low | High | Low | High | ||||
Net revenues | |||||||
Net revenues increase | 8.3 % | 9.2 % | 6.8 % | 7.8 % | |||
Reported diluted EPS | |||||||
Adjusted diluted EPS | |||||||
Cash provided by operations | Approximately | Approximately | |||||
Capital expenditures | Approximately | Approximately | |||||
Based on the favorable resolution of various tax contingencies in the second quarter, the full year adjusted effective tax rate is expected to be consistent with 2025.
Note on Non-GAAP Financial Measures
As used in this press release the term "reported" refers to measures under accounting principles generally accepted in
Non-GAAP adjusted measures are presented because management believes those measures are useful adjuncts to GAAP results. Non-GAAP adjusted measures should not be considered as an alternative to the corresponding measures determined under GAAP. Management may use these non-GAAP measures to evaluate our performance period over period and relative to competitors, to analyze the underlying trends in our business, to establish operational budgets and forecasts and for incentive compensation purposes. We believe that these non-GAAP measures are useful to investors and analysts to evaluate our performance period over period and relative to competitors, as well as to analyze the underlying trends in our business and to assess our performance. The additional tables attached below include reconciliations of non-GAAP adjusted measures to GAAP measures.
Conference Call Information
Quest Diagnostics will hold its quarterly conference call to discuss financial results beginning at 8:30 a.m. Eastern Time today. The conference call can be accessed by dialing 888-455-0391 within the
A replay of the call may be accessed online at www.QuestDiagnostics.com/investor or, from approximately 10:30 a.m. Eastern Time on July 23, 2026 until midnight Eastern Time on August 6, 2026, by phone at 866-388-5361 for domestic callers or 203-369-0416 for international callers. Anyone listening to the call is encouraged to read our periodic reports, on file with the Securities and Exchange Commission, including the discussion of risk factors and historical results of operations and financial condition in those reports.
About Quest Diagnostics
Quest Diagnostics works across healthcare to create a healthier world, one life at a time. We help connect people, from clinicians to consumers, with laboratory insights that illuminate a path to better health. With a focus on delivering smarter, simpler testing, our insights reveal new avenues to identify and treat disease, inspire healthy behaviors and improve healthcare management. Quest Diagnostics serves half the physicians and hospitals in
Forward Looking Statements
The statements in this press release which are not historical facts may be forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date that they are made and which reflect management's current estimates, projections, expectations or beliefs and which involve risks and uncertainties that could cause actual results and outcomes to be materially different. Risks and uncertainties that may affect the future results of the company include, but are not limited to, uncertain and volatile economic conditions, adverse results from pending or future government investigations, lawsuits or private actions, the competitive environment, the complexity of billing, reimbursement and revenue recognition for clinical laboratory testing, changes in government policies, including related to trade, and regulations, changing relationships with customers, payers, suppliers or strategic partners, acquisitions and other factors discussed in the company's most recently filed Annual Report on Form 10-K and in any of the company's subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, including those discussed in the "Business," "Risk Factors," "Cautionary Factors that May Affect Future Results" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of those reports.
This earnings release, including the attached financial tables, is available online in the Newsroom section at www.QuestDiagnostics.com.
ADDITIONAL TABLES FOLLOW
Quest Diagnostics Incorporated and Subsidiaries | |||||||
Three Months Ended | Six Months Ended | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Net revenues | $ 3,043 | $ 2,761 | $ 5,938 | $ 5,413 | |||
Operating costs and expenses and other operating income: | |||||||
Cost of services | 2,016 | 1,818 | 3,969 | 3,607 | |||
Selling, general and administrative | 529 | 486 | 1,033 | 962 | |||
Amortization of intangible assets | 38 | 39 | 75 | 78 | |||
Other operating expense (income), net | 1 | (20) | 3 | (18) | |||
Total operating costs and expenses, net | 2,584 | 2,323 | 5,080 | 4,629 | |||
Operating income | 459 | 438 | 858 | 784 | |||
Other income (expense): | |||||||
Interest expense, net | (63) | (67) | (126) | (134) | |||
Other income, net | 16 | 13 | 14 | 10 | |||
Total non-operating expense, net | (47) | (54) | (112) | (124) | |||
Income before income taxes and equity in earnings of equity method | 412 | 384 | 746 | 660 | |||
Income tax expense | (88) | (97) | (162) | (156) | |||
Equity in earnings of equity method investees, net of taxes | 10 | 9 | 14 | 27 | |||
Net income | 334 | 296 | 598 | 531 | |||
Less: Net income attributable to noncontrolling interests | 14 | 14 | 26 | 29 | |||
Net income attributable to Quest Diagnostics | $ 320 | $ 282 | $ 572 | $ 502 | |||
Earnings per share attributable to Quest Diagnostics' common | |||||||
Basic | $ 2.88 | $ 2.51 | $ 5.15 | $ 4.48 | |||
Diluted | $ 2.84 | $ 2.47 | $ 5.08 | $ 4.41 | |||
Weighted average common shares outstanding: | |||||||
Basic | 111 | 112 | 110 | 112 | |||
Diluted | 112 | 113 | 112 | 113 | |||
Quest Diagnostics Incorporated and Subsidiaries | |||
June 30, | December 31, | ||
Assets | |||
Current assets: | |||
Cash and cash equivalents | $ 626 | $ 420 | |
Accounts receivable, net | 1,666 | 1,408 | |
Inventories | 233 | 189 | |
Prepaid expenses and other current assets | 319 | 361 | |
Total current assets | 2,844 | 2,378 | |
Property, plant and equipment, net | 2,219 | 2,203 | |
Operating lease right-of-use assets | 678 | 657 | |
Goodwill | 9,112 | 8,945 | |
Intangible assets, net | 1,672 | 1,636 | |
Investments in equity method investees | 137 | 136 | |
Other assets | 277 | 270 | |
Total assets | $ 16,939 | $ 16,225 | |
Liabilities and Stockholders' Equity | |||
Current liabilities: | |||
Accounts payable and accrued expenses | $ 1,598 | $ 1,600 | |
Current portion of long-term debt | 10 | 504 | |
Current portion of long-term operating lease liabilities | 180 | 174 | |
Total current liabilities | 1,788 | 2,278 | |
Long-term debt | 5,632 | 5,167 | |
Long-term operating lease liabilities | 561 | 537 | |
Other liabilities | 1,059 | 957 | |
Redeemable noncontrolling interest | 80 | 80 | |
Stockholders' equity: | |||
Quest Diagnostics stockholders' equity: | |||
Common stock, par value | 2 | 2 | |
Additional paid-in capital | 2,374 | 2,381 | |
Retained earnings | 10,374 | 9,994 | |
Accumulated other comprehensive loss | (62) | (27) | |
Treasury stock, at cost; 52 shares as of both June 30, 2026 and December 31, 2025 | (5,172) | (5,180) | |
Total Quest Diagnostics stockholders' equity | 7,516 | 7,170 | |
Noncontrolling interests | 303 | 36 | |
Total stockholders' equity | 7,819 | 7,206 | |
Total liabilities and stockholders' equity | $ 16,939 | $ 16,225 | |
Quest Diagnostics Incorporated and Subsidiaries | |||
Six Months Ended June 30, | |||
2026 | 2025 | ||
Cash flows from operating activities: | |||
Net income | $ 598 | $ 531 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 293 | 283 | |
Provision for credit losses | 3 | 2 | |
Deferred income tax expense | 46 | 8 | |
Stock-based compensation expense | 43 | 43 | |
Other, net | 14 | 26 | |
Changes in operating assets and liabilities: | |||
Accounts receivable | (259) | (115) | |
Accounts payable and accrued expenses | 130 | (11) | |
Income taxes payable | 4 | 9 | |
Other assets and liabilities, net | 3 | 82 | |
Net cash provided by operating activities | 875 | 858 | |
Cash flows from investing activities: | |||
Business acquisitions, net of cash acquired | (38) | (17) | |
Capital expenditures | (252) | (225) | |
Other investing activities, net | 4 | 3 | |
Net cash used in investing activities | (286) | (239) | |
Cash flows from financing activities: | |||
Proceeds from borrowings | 494 | 400 | |
Repayments of debt | (501) | (1,001) | |
Purchases of treasury stock | (102) | — | |
Exercise of stock options | 81 | 42 | |
Employee payroll tax withholdings on stock issued under stock-based compensation plans | (38) | (42) | |
Dividends paid | (184) | (174) | |
Distributions to noncontrolling interest partners | (22) | (29) | |
Other financing activities, net | (109) | (50) | |
Net cash used in financing activities | (381) | (854) | |
Effect of exchange rate changes on cash and cash equivalents and restricted cash | (2) | 5 | |
Net change in cash and cash equivalents and restricted cash | 206 | (230) | |
Cash and cash equivalents and restricted cash, beginning of period | 420 | 549 | |
Cash and cash equivalents and restricted cash, end of period | $ 626 | $ 319 | |
Cash paid during the period for: | |||
Interest | $ 129 | $ 145 | |
Income taxes | $ 104 | $ 110 | |
Notes to Financial Tables
1) The computation of basic and diluted earnings per common share is as follows: | |||||||
Three Months Ended | Six Months Ended | ||||||
2026 | 2025 | 2026 | 2025 | ||||
(in millions, except per share data) | |||||||
Amounts attributable to Quest Diagnostics' common stockholders: | |||||||
Net income attributable to Quest Diagnostics | $ 320 | $ 282 | $ 572 | $ 502 | |||
Less: earnings allocated to participating securities | 1 | 1 | 2 | 2 | |||
Earnings available to Quest Diagnostics' common stockholders - basic and | $ 319 | $ 281 | $ 570 | $ 500 | |||
Weighted average common shares outstanding - basic | 111 | 112 | 110 | 112 | |||
Effect of dilutive securities: | |||||||
Stock options and performance share units | 1 | 1 | 2 | 1 | |||
Weighted average common shares outstanding - diluted | 112 | 113 | 112 | 113 | |||
Earnings per share attributable to Quest Diagnostics' common | |||||||
Basic | $ 2.88 | $ 2.51 | $ 5.15 | $ 4.48 | |||
Diluted | $ 2.84 | $ 2.47 | $ 5.08 | $ 4.41 | |||
2) The following tables reconcile reported GAAP results to non-GAAP adjusted results: | |||||||||||
Three Months Ended June 30, 2026 | |||||||||||
(dollars in millions, except per share data) | |||||||||||
Operating | Operating | Income tax | Equity in | Net income | Diluted EPS | ||||||
As reported | $ 459 | 15.1 % | $ (88) | $ 10 | $ 320 | $ 2.84 | |||||
Restructuring and | 4 | 0.2 | (1) | — | 3 | 0.04 | |||||
Other charges (b) | 1 | — | 1 | — | 2 | 0.02 | |||||
Gains and losses on | — | — | — | (1) | (1) | (0.01) | |||||
Amortization expense | 38 | 1.2 | (10) | — | 28 | 0.25 | |||||
ETB | — | — | (2) | — | (2) | (0.02) | |||||
As adjusted | $ 502 | 16.5 % | $ (100) | $ 9 | $ 350 | $ 3.12 | |||||
Six Months Ended June 30, 2026 | |||||||||||
(dollars in millions, except per share data) | |||||||||||
Operating | Operating | Income tax | Equity in | Net income | Diluted EPS | ||||||
As reported | $ 858 | 14.4 % | $ (162) | $ 14 | $ 572 | $ 5.08 | |||||
Restructuring and | 11 | 0.2 | (3) | — | 8 | 0.08 | |||||
Other charges (b) | 5 | 0.1 | — | — | 5 | 0.05 | |||||
Gains and losses on | — | — | (2) | 6 | 4 | 0.04 | |||||
Amortization expense | 75 | 1.3 | (19) | — | 56 | 0.50 | |||||
ETB | — | — | (14) | — | (14) | (0.13) | |||||
As adjusted | $ 949 | 16.0 % | $ (200) | $ 20 | $ 631 | $ 5.62 | |||||
Three Months Ended June 30, 2025 | |||||||||||
(dollars in millions, except per share data) | |||||||||||
Operating | Operating | Income tax | Equity in | Net income | Diluted EPS | ||||||
As reported | $ 438 | 15.9 % | $ (97) | $ 9 | $ 282 | $ 2.47 | |||||
Restructuring and | 7 | 0.3 | (2) | — | 5 | 0.04 | |||||
Other charges (b) | 28 | 1.0 | (6) | — | 22 | 0.19 | |||||
Gains and losses on | — | — | 1 | (1) | (2) | (0.01) | |||||
Other gains (d) | (46) | (1.7) | 12 | — | (34) | (0.30) | |||||
Amortization expense | 39 | 1.4 | (11) | — | 28 | 0.25 | |||||
ETB | — | — | (3) | — | (3) | (0.02) | |||||
As adjusted | $ 466 | 16.9 % | $ (106) | $ 8 | $ 298 | $ 2.62 | |||||
Six Months Ended June 30, 2025 | |||||||||||
(dollars in millions, except per share data) | |||||||||||
Operating | Operating | Income tax | Equity in | Net income | Diluted EPS | ||||||
As reported | $ 784 | 14.5 % | $ (156) | $ 27 | $ 502 | $ 4.41 | |||||
Restructuring and | 26 | 0.5 | (7) | — | 19 | 0.17 | |||||
Other charges (b) | 30 | 0.6 | (6) | — | 24 | 0.21 | |||||
Gains and losses on | — | — | 1 | (1) | (2) | (0.01) | |||||
Other gains (d) | (46) | (0.9) | 14 | (8) | (40) | (0.36) | |||||
Amortization expense | 78 | 1.4 | (20) | — | 58 | 0.51 | |||||
ETB | — | — | (12) | — | (12) | (0.10) | |||||
As adjusted | $ 872 | 16.1 % | $ (186) | $ 18 | $ 549 | $ 4.83 | |||||
(a) | For each of the three and six months ended June 30, 2026 and 2025, the pre-tax impact represents costs primarily associated with workforce reductions and integration costs incurred in connection with further restructuring and integrating our business. The following table summarizes the pre-tax impact of restructuring and integration charges on our consolidated statements of operations: |
Three Months Ended | Six Months Ended | ||||||
2026 | 2025 | 2026 | 2025 | ||||
(dollars in millions) | |||||||
Cost of services | $ 1 | $ 1 | $ 2 | $ 7 | |||
Selling, general and administrative | 3 | 6 | 9 | 19 | |||
Operating income | $ 4 | $ 7 | $ 11 | $ 26 | |||
(b) | The three and six months ended June 30, 2026 and 2025 include losses associated with the change in the fair value of the contingent consideration accrual associated with previous acquisitions, recorded in other operating expense (income), net. Additionally, for both the three and six months ended June 30, 2025, the pre-tax impact primarily represents a |
(c) | For all periods presented, the pre-tax impact represents gains and losses associated with changes in the carrying value of our strategic investments, principally recorded in equity in earnings of equity method investees, net of taxes, and other income, net. |
(d) | The three and six months ended June 30, 2025 include a |
(e) | For restructuring and integration charges, other gains/charges, gains and losses on investments, and amortization expense, income tax impacts, where recorded, were primarily calculated using combined statutory income tax rates of |
3) | For both the three and six months ended June 30, 2026, we repurchased 0.5 million shares of our common stock for |
4) | The outlook for adjusted diluted EPS represents management's estimates for the full year 2026 before the impact of special items. Further impacts to earnings related to special items may occur throughout 2026. Additionally, the amount of ETB is dependent upon employee stock option exercises and our stock price, which are difficult to predict. The following table reconciles our 2026 outlook for diluted EPS under GAAP to our outlook for adjusted diluted EPS: |
Low | High | ||
Diluted EPS | $ 9.97 | $ 10.17 | |
Restructuring and integration charges (a) | 0.14 | 0.14 | |
Amortization expense (b) | 0.99 | 0.99 | |
Other charges (c) | 0.10 | 0.10 | |
Gains and losses on investments (d) | 0.04 | 0.04 | |
ETB | (0.19) | (0.19) | |
Adjusted diluted EPS | $ 11.05 | $ 11.25 |
(a) | Represents estimated pre-tax charges of |
(b) | Represents estimated pre-tax amortization expenses of |
(c) | Principally represents estimated pre-tax net losses of |
(d) | Income tax impacts were calculated using a combined statutory income tax rate of |
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SOURCE Quest Diagnostics