Oct 28, 2026 earnings call — Guidance raised; M&A and specialty testing drive growth
Raised full-year outlook: enterprise revenue now expected to grow 5.9% to 6.7% and adjusted EPS guided to $18.30 to $18.70.
Revenue $3.8B (est $3.8B) · EPS $4.78 (est $4.64)
Key quotes
"We announced FDA approval of a companion diagnostic supporting patients with advanced melanoma, This approval supports treatment decisions for both patients and providers, demonstrates the capabilities of our PGDX platform."
"Our BLS segment ended the quarter with a backlog of $8.9 billion We expect approximately $2.8 billion to convert into revenue over the next 12 months."
"As Adam mentioned, subsequent to the quarter end, we entered into agreements to acquire select assets of BioReference, Myriad Genetics' prenatal health testing business and Millennium Health, In addition to being strong strategic fits, each of these transactions is expected to meet our acquisition financial criteria."
Analyst Q&A 12
Margins and 2027 outlook
Q (Erin Wilson Wright · Morgan Stanley): He asked how margins will progress into 2027, considering PAMA and recent acquisitions, and whether margins can expand next year.
A: Management said margins have improved for many quarters and they have multiple levers to offset PAMA, but the PAMA implementation year will be tougher. They said acquisitions will be accretive in year one but take time to reach company average margins, and they will give guidance in February 2027.
"So, all in all, we are looking forward to wrapping up 2026 with really strength and go into 2027 with momentum." — Julia Wang (CFO)
M&A pipeline and deal margins
Q (Lisa Gill · JPMorgan): He asked about the current M&A pipeline, why some acquisitions look non-accretive initially, and whether M&A opportunities will increase into 2027.
A: Management said the pipeline remains strong and timing is hard to control. They explained each deal is different, that many tuck-ins fit existing businesses and will be accretive in year one, and they expect more announcements in the future.
"We expect to have more announcements in, you know, the future as we move forward." — Adam H. Schechter (CEO·CHAIR)
Impact of guideline changes on testing
Q (Ann Hynes · Mizuho): She asked how changes in cardiovascular screening recommendations for women affect ordering, adoption speed, and insurance coverage.
A: Management said societies' recommendations help increase physician prescribing and support payer coverage. They noted many physicians already screen more for women's cardiovascular health and that guideline changes should help over time, though effects are hard to isolate across 750 million tests.
"I do believe that physicians will tend to prescribe more of those tests faster when they become a core recommendation of a very strong society." — Adam H. Schechter (CEO·CHAIR)
BioReference deal synergies and centers
Q (Eric Coldwell · Baird): He asked how the BioReference deal can be accretive in year one and what synergies or service center consolidations are planned.
A: Management said they know BRL well from prior deals and have a clear view of cost structure and synergies. They said where service centers overlap they will decide which to keep and seek synergies across capacity, procurement, and contracting to improve margins.
"we are feeling very comfortable with the outlook that we put out there as it relates to the first year contribution." — Julia Wang (CFO)
Revenue guidance and PAMA prep
Q (Michael Cherny · Leerink Partners): He asked how much of the guidance change is from M&A and what LabCorp is doing now to prepare to offset PAMA in 2027.
A: Management said the guidance raise is driven mainly by organic strength, with small contributions from recent deals. Regarding PAMA, they assume it happens in their base case and plan to offset it via strong diagnostics, BLS growth, accelerated Launchpad initiatives, and business development.
"In our base case, we are going to assume that PAMA happens next year." — Adam H. Schechter (CEO·CHAIR)
Biopharma demand and capacity
Q (Luke Sergott · Barclays): He asked where biopharma demand is coming from, which therapy areas are growing, and whether capacity is tight as bookings pick up.
A: Management said central lab growth is strong, driven by large pharma across oncology, specialty, and rising cardiometabolic work, and both central labs and early development show strong book-to-bill. They said LabCorp has plenty of capacity globally and is building a new Indianapolis lab to support future CLS growth.
"So if you look at central laboratory business in particular, it is very strong growth." — Adam H. Schechter (CEO·CHAIR)
Timing and rationale for Myriad deal; early development
Q (Tycho Peterson · Jefferies): He asked why buy Myriad assets after revenue declines and payer issues, and how biotech funding trends affect early development.
A: Management said they are confident taking over the Myriad assets because the tests fit LabCorp's capabilities and can compete in fast-growing women's health areas. They added that early development is smaller but performing well, with strong RFPs and study starts and early success winning larger pharma work.
"So, again, the early development business, much smaller, much less important part of our business, but it is performing well right now." — Adam H. Schechter (CEO·CHAIR)
Multi-year view on PAMA effects
Q (David Westenberg · Piper Sandler): He asked about multi-year PAMA impact, whether headwinds extend into 2028–2029, and how the industry might change contracting or discipline.
A: Management said the biggest impact is in 2027 under their base case and that incremental impacts in 2028 and 2029 are meaningfully less and manageable. They also said they will continue to decouple contracts from the fee schedule and manage the outer years within normal operations.
"The majority of the impact is in 2027, the first year." — Adam H. Schechter (CEO·CHAIR)
Drivers of diagnostic growth and price/mix
Q (Lou Li · BofA): He asked what drove the quarter's organic growth, the split between volume and price/mix, and any notes on pricing.
A: Management said diagnostics grew 6.5% with organic growth 4.4%, of which 3.1% was organic volume and 1.3% was price/mix driven by more tests per accession. They cautioned quarter-to-quarter fluctuation is normal and they expect both volume and price/mix to be strong over time.
"If you look at the diagnostic business, it was very strong." — Adam H. Schechter (CEO·CHAIR)
Type of M&A targets and timing
Q (Kevin Caliendo · UBS): He asked why recent deals were not traditional hospital deals and whether that reflects preference, availability, or PAMA-related waiting.
A: Management said timing controls deal flow and the pipeline includes hospital and regional lab opportunities; they urged investors to stay tuned and noted PAMA could increase deal activity. They described the overall M&A pipeline as strong.
"So I would say that the deal pipeline continues to be strong." — Adam H. Schechter (CEO·CHAIR)
ACA impact and BLS seasonal step-up
Q (Elizabeth Anderson · Evercore): She asked for updates on ACA effects on volume and whether BLS will still see the typical fourth-quarter seasonal increase in bookings.
A: Management said ACA was a slight headwind of about 30 basis points of diagnostic volume in Q3 and they expect a similar level in Q4, noting that this insured group is less than 4 to 5% of diagnostic volume. They also said CLS bookings and momentum remain strong but quarter-to-quarter pharma timing can vary.
"In terms of the ACA impact, it was a slight headwind of about 30 basis points of diagnostic volume in the third quarter." — Julia Wang (CFO)
PAMA exposure and MRD progress
Q (Jack Meehan · Operon): He asked what actions were taken to disconnect non-Medicare business from the fee schedule, whether the $125 million estimate assumes spillover, and an update on MRD test progress and sequencer choice.
A: Management clarified $105 million relates to traditional Medicare/Medicaid and said there is some spillover into other parts of the business that they will manage in ordinary course. They also said MRD development is progressing with academic collaborations to build data for reimbursement and no sequencer choice is finalized yet.
"There is some spillover into other parts of the business." — Adam H. Schechter (CEO·CHAIR)