Agilent Technologies, Inc. (NYSE:A) Q2 Earnings Top Expectations

Q2 Earnings Report

The research and development company reported a 10% year over year increase in revenue that came in at $1.21 billion. Agilent’s Life Sciences and Applied Markets registered a 7% increase in revenues that came in at $561 million. The cross lab group recorded a 13% year-over-year increase in revenue that came in at $426 million.

Net income totaled $205 million or 63 cents a share, topping analysts’ expectations as well as last year’s net income of $164 million or 50 cents share. Business exit and divestitures cost the company $8 million as acquisition, and integration costs came in at $4 million.

The company also recorded other net gains of $11 million. Excluding this items and tax benefit of $24 million, the company reported a non-GAAP net income of $212 million.

According to the Chief Executive Officer, net income growth is a testament that they are executing on the growth strategy.

“On the innovation front, we are seeing strong momentum in our newly released products and are continuing to introduce highly differentiated solutions to help our customers advance their work. We are also effectively deploying our capital—the recently closed acquisitions of Genohm and Lasergen, Inc. will add new strategic capabilities to drive future growth,” said Mr. McMullen.

 Q3 Guidance

For the third quarter, Agilent Group expects revenue to range between $1.185 billion and $1.205 billion. GAAP earnings, on the other hand, is expected to range between $0.61 and $0.63 a share. For the full year, the company expects revenue of between $4.85 billion and $4.87 billion. GAAP earnings, on the other hand, should range between $2.63 billion and $2.67 billion.

 Acquisition Drive

In addition, Agilent Technologies has confirmed the completion of the acquisition of Genohm, a Switzerland based company specializing in the development of cloud-based software solutions for laboratory management.

The acquisition is set to enhance the company’s software portfolio with the addition of LIMS and workflow management. Agilent should bring greater context to analytical data with the acquisition while making it easy for scientists to generate results more efficiently.

Genohm joins the company with SLIMs, a digital platform that provides laboratories, with a laboratory management information management system and electronic lab notebook.

Agilent has been aggressive on the acquisition front. Early this month it completed the acquisition of Lasergen an emerging biotechnology company. The acquisition will provide the company with exposure to innovative technologies for the development of DNA sequencing.

In 2016, Agilent Technologies invested in the privately held company and consequently acquired a 48% stake. The company has since invoked a two-year call option that allowed it to acquire the remaining shares for $105 million.

Since the first investment Lasergen and Agilent Technologies have been collaborating on the development of a workflow solution for clinical applications leveraging Lesergens Lightning Terminators.