IDEXX Laboratories Q2 2025 Earnings Call Transcript

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Provided by Quartr
August 4, 2025

Key Takeaways

  • Positive Sentiment: IDEXX delivered 11% reported revenue growth (9% organic) in Q2, drove 14% comparable operating profit expansion and achieved $3.63 EPS (17% comparable growth), prompting full-year revenue guidance to rise to $4.205B–$4.28B and EPS to $12.40–$12.76.
  • Positive Sentiment: The Companion Animal Group set a record with 6,070 premium instrument placements (up 23% YoY), including 2,388 InVueDx units, and raised its full-year InVueDx placement outlook to 5,500.
  • Positive Sentiment: New diagnostics innovations gained rapid uptake, with over 2,500 practices ordering CancerDx and launches of Catalyst Cortisol and pancreatic lipase tests bolstering consumables revenue.
  • Negative Sentiment: U.S. veterinary clinic visits declined 2.5% in Q2, constraining CAG diagnostic recurring revenue despite price realizations and innovation-driven volume growth.
  • Positive Sentiment: International CAG diagnostic recurring revenues grew 11% organically, sustaining double-digit expansions across regions and benefiting from global net price improvements.
AI Generated. May Contain Errors.
Earnings Conference Call
IDEXX Laboratories Q2 2025
00:00 / 00:00

Transcript Sections

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Executive

Morning, and welcome to the IDEXX Laboratories Second Quarter twenty twenty five Earnings Conference Call. As a reminder, today's conference is being recorded. Participating in the call this morning are Jay Mazelski, President and Chief Executive Officer and Drew Emerson, Chief Financial Officer and John Ravis, Vice President, Investor Relations. IDEXX would like to preface the discussion today with a caution regarding forward looking statements. Listeners are reminded that our discussion during the call will include forward looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those discussed today.

Executive

Additional information regarding these risks and uncertainties is available under the forward looking statements notice in our press release issued this morning as well as in our periodic filings with the Securities and Exchange Commission, which can be obtained from the SEC or by visiting the Investor Relations section of our website, idexx.com. During this call, we will be discussing certain financial measures not prepared in accordance with Generally Accepted Accounting Principles or GAAP. A reconciliation of these non GAAP financial measures to the most directly comparable GAAP measures is provided in our earnings release, which may also be found by visiting the Investor Relations section of our website. In reviewing our second quarter twenty twenty five results and updated 2025 guidance, please note all references to growth, organic growth and comparable growth refer to growth compared to the equivalent prior year period unless otherwise noted. To allow broad participation in the Q and A, we ask that each participant limit their questions to one with one follow-up as necessary.

Executive

We appreciate you may have additional questions, so please feel free to get back into the queue. And if time permits, we'll take your additional questions. Today's prepared remarks will be posted in the Investor Relations section of our website after the earnings conference call concludes. I would now like to turn the call over to Andrew Emerson.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Good morning. I'm pleased to take you through our second quarter results and provide an update on our full year 2025 financial outlook. In terms of highlights, IDEXX delivered another quarter of strong financial results supported by continued strong global execution in our Companion Animal business with momentum building in the adoption of IDEXX Innovations. Revenue increased 11% as reported and 9% organically, supported by nearly 7.5% organic growth in CAG Diagnostic recurring revenues, reflecting continued gains in The U. S.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

And double digit expansion in international regions. Overall, organic revenue benefited by approximately 200 basis points from CAG instrument revenues, delivering a record quarter of premium instrument placements, including nearly 2,400 IDEXX InVue Dx instruments. Partially offsetting these benefits, CAG Diagnostic recurring revenue growth in Q2 was constrained by impacts from macro and sector headwinds, leading to a 2.5% decline in U. S. Same store clinical visit growth levels in the quarter.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

IDEXX's operating performance continued to be strong in Q2, reflecting an operating profit growth of 14% on a comparable basis, net of approximately 27% benefit from lapping a discrete litigation expense in Q2 twenty twenty four. Operating profit benefited from solid revenue growth and operating margin gains, which were led by gross margin expansion. High operating profit gains enabled earnings per share of $3.63 in the quarter, resulting in EPS growth of 17% on a comparable basis, net a $0.56 EPS growth benefit related to the comparison of the prior year period discrete litigation expense and a $0.10 benefit from share based compensation. IDEXX execution remains strong as we advance our innovation agenda in the CAG businesses while continuing to work through pressure on clinical visit levels. We're increasing our full year revenue outlook by $90,000,000 at midpoint with an updated range of $4,205,000,000 to $4,280,000,000 This reflects an outlook for overall reported revenue growth of 7.7% to 9.7%, including strong Q2 performance and increased InViewDx instrument revenue along with favorable impacts from foreign exchange updates.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Our updated full year overall organic revenue growth outlook is for 7% to 9% with organic CAG Diagnostic recurring revenue growth of 5.8% to 8%. These organic growth ranges represent 05% increase at midpoint to our previous outlook supported by strong global execution in our CAG business. We're increasing our EPS outlook to $12.4 to $12.76 per share, up $0.40 per share at midpoint, reflecting 9% to 13% full year comparable EPS growth. We'll discuss our updated 2025 financial outlook later in my comments. Let's begin with a review of our second quarter results and recent sector trends.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Second quarter organic revenue growth of 9% was driven by 10% CAG revenue gains, 8% growth in our Water business and 3% gains in LPD. Strong CAG results were supported by CAG Diagnostic recurring revenues, which increased nearly 7.5% organically, including global average net price improvement of approximately 4% and benefits from CAG Diagnostic instrument revenues increasing 62% organically, aided by InVue DX placements. CAG Diagnostic recurring revenue growth in Q2 was supported by 11% organic gains in international regions, another quarter of double digit expansion. Strong international performance continues to be driven by IDEXX execution reflected in solid volume gains, benefiting from new business and double digit year over year expansion of our premium instrument installed base as well as benefits from net price realization. U.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

S. Organic CAG Diagnostic recurring revenues grew 6% in Q2 supported by solid volume gains and 3.5% benefit from net price realization. U. S. Clinical visits declined 2.5 in the quarter reflecting an IDEXX U.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

S. CAG Diagnostic recurring revenue growth premium to U. S. Clinical visits of approximately 800 basis points, up modestly from the first quarter. Diagnostic frequency and utilization per clinical visit continued to expand solidly at the clinic level, highlighting the important and expanding role of diagnostics for those seeking veterinary services.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

IDEXX Innovation and Commercial Execution delivered organic revenue gains in our major testing modalities globally in the second quarter. IDEXX VetLab consumable revenues increased 14% on an organic basis in the second quarter, reflecting double digit growth in both The U. S. And internationally. Consumable revenue expansion is supported by testing utilization across regions, including benefits from recent product launches and high customer retention levels, while our commercial teams further build our global premium instrument installed base.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

TAG instrument placements increased significantly in Q2 compared to prior year levels, reaching a quarterly record aided by broad availability of InVueDx. Total premium placements reached 6,070 units, an increase of 23% year over year. The quality of CAG instrument placements remains excellent, reflected in ten ninety one global new and competitive catalyst placements, including three forty six new and competitive placements in North America. IDEXX NVDX placements of 2,388 were driven by strong demand for our new highly differentiated platform. These new placements and high customer retention levels supported a 10% year over year growth in our premium instrument installed base, and we're looking forward to building on this momentum during the second half of the year.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

IDEXX Global Reference Lab revenues increased 5% organically in Q2, an increase of approximately 2% from the first quarter on a days adjusted basis. Global Reference Lab gains continued to be driven by solid volume growth, including initial benefits from IDEXX CancerDx. Global rapid assay revenues declined 3% organically in Q2. Rapid assay results were constrained by customers shifting pancreatic lipase testing to our Catalyst instrument platform, which we estimated to be a 5% headwind in Q2 revenue growth. Venerase Software and Diagnostic Imaging organic revenues increased 9%, driven by recurring revenues, reflecting benefits from ongoing momentum in our cloud based software installations.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Water revenues increased 8% organically in Q2 with growth driven by double digit revenue expansion in our international regions and solid mid single digit growth in The U. S. Livestock, poultry and dairy revenues increased 3% organically in the quarter led by commercial execution in North America and Asia Pacific. Turning to the P and L, we had another quarter of strong profit gains in Q2 reflected in 130 basis points of comparable operating margin expansion, net of approximately 600 basis points benefit from lapping a now concluded discrete litigation expense in Q2 twenty twenty four. Gross profit increased 12% in the quarter as reported and 11% on a comparable basis.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Gross margins were 62.6, up approximately 110 basis points on a comparable basis. These gains reflected benefits from IDEXX VetLab consumable growth, lab productivity and operational improvements and pricing which offset inflationary cost effects. Reported gross margin gains were moderated by a 20 basis point negative impact related to foreign exchange changes net of our hedge positions. On a reported basis, operating expenses decreased 9% year over year, reflecting a 19% favorable growth rate impact from comparison to prior year levels, which included a $61,500,000 expense in the now concluded litigation matter. Adjusting for this effect, operating expense growth was modestly below revenue growth at 9% as we continue to invest in innovation and commercial capabilities while supporting operating margin gains.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Q2 EPS was $3.63 per share, including benefit of $8,000,000 or zero one zero dollars per share related to share based compensation activity and $07 from a discrete tax reserve release. Foreign exchange added $3,000,000 to operating profit and $03 to EPS in Q2, net of hedge effects, reflecting comparable EPS increase of 17%. Free cash flow was $152,000,000 in Q2 and $360,000,000 in the 2025. On a trailing twelve month basis, our net income to free cash flow conversion rate was 80%, including approximately 8% unfavorable impact from the approximately $80,000,000 judgment payment related to the now concluded litigation noted on prior calls. For full year, we're maintaining our outlook for free cash flow conversion of 80% to 85%, reflecting consistent outlook for full year capital spending of approximately $160,000,000 Our balance sheet remains strong.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

We finished the period with leverage ratios of 0.8 times gross and 0.6 times net of cash. During the quarter, we repaid approximately $103,000,000 of long term notes and continued to deploy capital towards share repurchases, allocating $329,000,000 during the second quarter. For the first half of the year, we've allocated $744,000,000 of capital to share repurchases, supporting a 2.7% year over year reduction in diluted shares outstanding for this period, aligned with our previously stated expectations. Turning to our full year 2025 outlook. As noted, we're increasing our projected range for overall revenue to $4,205,000,000 to $4,280,000,000 At midpoint, this reflects approximately $20,000,000 operational improvement building on strong second quarter performance and increased InVueDx revenue expectations along with approximately $70,000,000 benefit from updated foreign exchange impacts at the rates outlined in our press release.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Our updated revenue growth outlook is 7.7% to 9.7% as reported, including approximately 0.7 for full year growth benefit from foreign exchange. As a sensitivity, a 1% strengthening of the U. S. Dollar would reduce revenue by approximately $8,000,000 and EPS by $03 for the year. Our updated overall organic revenue growth outlook of 7% to 9% reflects an estimated organic growth range of 5.8% to 8% for CAG Diagnostic recurring revenues, including consistent 4% to 4.5% benefit of global net price realization and U. S. Clinical visit declines aligned with more recent trends at midpoint. We're increasing our expectations for InViewDx to 5,500 placements during the year with instrument revenue expected to be over $60,000,000 building up strong demand signals for the platform.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

In terms of key financial metrics, we're increasing our reported operating margin outlook for 2025 to 31.3% to 31.6%, reflecting increased expectations for 50 to 80 basis points for full year comparable operating margin improvement, net of 180 basis point operating margin benefit related to the discrete litigation expense impacts and updated foreign exchange effects. This outlook also incorporates commercial expansions in four countries during the second half of the year, including a modest expansion in The U. S. To support our growing portfolio of diagnostic solutions. With respect to the dynamic trade environment, we remain well positioned to navigate the changing tariff landscape with our best estimates included in our outlook.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Our primary objectives and ongoing efforts remain focused on continuous supply to customers and minimizing impacts through operational planning. Our updated full year EPS outlook is $12.4 to $12.76 per share, an increase of zero four zero dollars per share at midpoint. Our EPS outlook incorporates increased projections for operational performance of $0.11 and foreign exchange benefit of $0.22 at midpoint compared to our prior guide. We've also updated our tax benefit related to share based compensation activity, now $15,000,000 for the full year, an increase of $09 per share compared to our prior estimate. This is partially offset by $02 per share unfavorable tax impacts compared to our prior projections, including benefits from the discrete tax reserve release and updated outlook for our base rate.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

For the third quarter, we're planning for reported revenue growth in line with the implied second half growth range, including approximately 1% growth benefit from foreign exchange. At midpoint, the organic revenue growth outlook includes U. S. Clinical visit growth in line with recent trends expanding benefits from innovation, including the cortisol slide, which began shipping last week. We're planning for modest comparable operating margin expansion, aligned with advancing additional commercial investments and timing of project spend.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

That now concludes our financial review. I'll turn the call over to Jay for his comments.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Thank you, Andrew, and good morning. IDEXX delivered a very strong quarter of performance as reflected in solid execution across all key drivers of our strategy. Our focus on supporting our customers and our mission resulted in rapid uptake of new innovations and the broader adoption of software tools that support practice workflow and staff. The demand for diagnostics reflects its foundational role in assessing the health of the patient. While macroeconomic pressures persist in many of our key regions, veterinary practices continue to prioritize investments in diagnostics and software that enhance efficiency to deliver clinical insight and support better outcomes.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

At the same time, pet owners are demonstrating a strong desire for a high standard of care, particularly for an aging pet population. In q two, diagnostics frequency, the percentage of clinical visits that included diagnostic tests, sustained at 50 basis points year on year in growth, an important metric we track. The continued growth in diagnostics use underscores pet owners' focus on early detection and comprehensive treatment to support longevity and well-being. It also highlights the willingness to pay for advanced veterinary services where complex health issues may be of concern. IDEXX is extremely well positioned to support these broad care objectives with our expanding menu of innovative diagnostics, testing platforms and our cloud native software solutions that provides advantages in detecting disease and supporting patient workflow.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Helping practices support more patient visits productively comes at a time when many still face staffing and client service challenges. Our commercial teams again demonstrated outstanding execution, delivering record premium instrument placements globally and driving solid growth in recurring revenues. In q two, we delivered double digit growth in our premium instruments installed base compared to the prior year, led by the ramping of IDEXX InVue DX placements and high sustained momentum in our chemistry and hematology solutions. North America delivered a historic record q two quarter of placements and economic value, supported by the unrestrained launch of InVueDx at well over 300 competitive and greenfield catalysts. We continue to see significant engagement across new greenfield and competitive accounts, reflecting Practice's desire to invest in best in breed innovative solutions that improve patient care and clinic productivity.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Supporting this, there was a strong trend in new practice formation in q two with IDEXX selected in a high number of instances as the partner of choice in outfitting these practices with a full portfolio of IDEXX solutions. Internationally, our teams achieved double digit growth in CAG Diagnostics recurring revenue, supported by the tenth consecutive quarter of double digit installed base growth. This success is a result of commercial strategies tailored for local country circumstances with excellent product market fit and network of reference labs supporting high service levels and an expanding commercial footprint. As Andrew mentioned in his full year guidance, we are making commercial investments to expand three more international country organizations as well as modestly enhancing the US commercial team. These high return investments are a reflection of the confidence we have in growing these geographies and supporting a broader portfolio of diagnostic products that are resonating strongly with customers.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

These expansions are key enablers to support an expanding set of innovations ranging from the launch of IDEXX CancerDx and InVuDx to new additions like Catalyst Cortisol and pancreatic lipase. Each of these products represents a meaningful advancement in our veterinary diagnostics offering, and their successful adoption supports long term growth. There are also significant benefits to decreasing the number of customers that each account manager is responsible for as our experience is that customers use more diagnostics as part of their care protocols when we visit them more often. We expect to have these expanded organizations in place by the start of 2026. A key focus of our commercial organization is ensuring that placements are high quality and positioned to drive strong recurring revenues over time.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

We continue to prioritize placements and practices where IDEXX solutions can deliver the most value to both clinicians and their clients. With MUDX as an addition to our premium instrument offering, we are seeing very strong sustained double digit growth in EV amongst our field teams as they have an opportunity to place both larger dollar value suites for a single MuDX addition to an existing IDEXX customer. As a testament to the value we deliver, customer retention remained in the high nineties across diagnostic modalities. This enduring loyalty reflects the confidence veterinarians place in IDEXX to be their partner in providing excellent patient care and the ongoing investments we make to keep their solutions at the leading edge. IDEXX NVDX continues to be a transformational platform that is reshaping point of care cytology testing.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Since broad commercial availability commenced in April, demand has exceeded expectations. We have now placed nearly 2,700 instruments globally this year through June, giving us confidence to increase our 2025 placement estimate by a thousand units from 4,500 to 5,500. Feedback from early adopters remains highly positive. Practices consistently highlight the slide free intuitive workflow, rapid turnaround time, and diagnostics confidence provided by InVueDx in its advanced AI powered insights. Early consumables usage, driven by testing in both ear cytology and blood morphology, is highly encouraging.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

And with our expected launch of FNA for lumps and bumps later this year, InVue Dx will play an important role in supporting our long term recurring revenue goals. InBudx also playing an important role in our recontracting activity as we saw a very high number of customers in Q2 extend their relationship with us, often in advance of the date required to do so. A cornerstone of our strategy remains delivering differentiated diagnostic insights that elevate care and strengthen our leadership in the sector. The edX CancerDx panel launched in late March through our North American reference laboratories has continued to gain traction among general practice veterinarians as well as oncology specialists. Since launch, over 2,500 practices have ordered the test.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Moreover, of these customers adopting the test, almost 15% of sample submissions are coming from competitive lab customers. The broad adoption of IDEXX CancerDx is indicative of the value clinicians see in this test and the underserved need of early cancer screening. Cancer remains one of the leading causes of mortality among dogs. And IDEXX CancerDx provides veterinarians with a cost effective, highly sensitive tool to detect canine lymphoma earlier. This enables earlier intervention and the possibility of significantly improved outcomes.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Initial utilization patterns are consistent with our expectations, with customers using the test as both an aiding diagnosis and a small but growing number of practices more broadly incorporating CancerDx into most wellness screening panels. As awareness grows and we broaden the testing menu over time to incorporate new cancer types, we expect a multiplier to our reference lab testing volumes. Building off this early success we've seen in North America, we are preparing for the international rollout of CancerDx in 2026. Early excitement from veterinarians in these regions underscores a significant global need for affordable and accessible cancer diagnostics. Last week, we launched Catalyst Cortisol in North America, our third new Catalyst test in less than a year, underscoring our commitment to expanding the platform's menu and our technology for life promise.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Catalyst cortisol enables veterinarians to measure cortisol levels rapidly at the point of care, supporting the diagnosis and monitoring of adrenal conditions such as Cushing's disease and Addison's disease. The addition of Cortisol to Catalyst is the most frequently requested menu expansion from our customers. Early customer response has been highly enthusiastic, highlighting the value of real time results to guide treatment decisions during the patient visit. Catalyst pancreatic lipase launched globally last year continues to perform well and meet strong customer demand. This innovative test offers a quantitative single slide solution that delivers rapid, reliable results for canine and feline patients suspected of pancreatitis, a common and often challenging condition to diagnose early.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Adoption has been robust with over 40% of our global Catalyst installed base already utilizing the test where available. This strong uptake reflects the test clinical utility, the value veterinarians place on speed and accuracy in diagnostic workflows, and the continued expansion of our Catalyst menu to address important unmet needs in veterinary care. The Catalyst Smart QC clip, which began shipping late last year, is also seeing strong adoption. Customers value the load and go monthly quality control process that ensures accurate results and instrument reliability. New innovations made meaningful contributions to the growth of IDEXX BandLab consumables in a quarter.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Our software ecosystem continues to be an essential component of IDEXX's differentiated value proposition By delivering intuitive, cloud native solutions that integrate diagnostics, imaging, client engagement, and practice operations, IDEXX software helps clinics improve efficiency and patient care while driving incremental recurring revenues for our business. Our cloud based PIMs platforms, as EasyVet and Neo, delivered solid double digit installed base growth with particularly strong demand for multi location practices and corporate accounts. Clinics are choosing these solutions for their modern user experience, scalability, and robust integration with the IDEXX diagnostics ecosystem. Vellel, our pet owner engagement application, saw continued momentum in q two with double digit sequential growth in active users compared to q one. Fellow's integrated communication tools are helping clinics improve appointment adherence and drive compliance with recommended care.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Early customer data shows the practices using Fellow experience increased visit volume, higher diagnostics utilization, and better treatment plan compliance, positive indicators that support our thesis that digital engagement drives better clinical outcomes. Our diagnostic imaging business continues to demonstrate strong momentum too, extending clinical capability and streamlining imaging workflows. Our low dose, high image quality radiographic imaging systems paired with our IDEXX Webpack software provide seamless image viewing, sharing, and storage fully integrated into veterinary practice workflows. In the second quarter, we surpassed an installed base of 10,000 imaging systems in North America with a comparable number of customers subscribing to IDEXX Web PACS, highlighting strong alignment between hardware adoption and recurring software engagement. While macroeconomic and sector dynamics remain fluid, including lingering inflationary impacts, pressuring clinical visits, we are confident in the durability of the veterinary market and the resilience of pet health care demand.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Pet ownership remains elevated, and the aging pet population continues to expand, supporting higher levels of diagnostics utilization over time. Our focus remains on executing with discipline, supporting our customers through innovative solutions and investing in capabilities that position IDEXX to capture our significant long term opportunity. Diagnostics sit at the center of the system of care, and pet owner expectations for quality care continues to rise. IDEXX is well positioned to lead, and our focus is on exceptional execution to deliver solid growth and profit gains. As I conclude our prepared remarks, I want to express my deep appreciation for our 11,000 IDEXX employees worldwide.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

The commitment to innovation, customer partnership, and operational excellence is what enables us to deliver these results quarter after quarter. I'd also like to remind you that we will be hosting our annual Investor Day on August 14 at our global headquarters in Westbrook, Maine. This session will be streamed live for those unable to attend in person. With that, we'll conclude the prepared portion of our call and open the line for questions.

Operator

Thank We will take our first question from Chris Schott with JPMorgan.

Chris Schott
Chris Schott
Managing Director at JP Morgan

Great. Thanks so much for the question. I was hoping you could just elaborate a bit more on the Indu uptake. And maybe specifically, what type of practices are you seeing the great amount greatest amount of traction here? And then maybe the second part of that, just obviously some some, you know, some very good trends here with placements.

Chris Schott
Chris Schott
Managing Director at JP Morgan

But when I look at that 5,500 placements for the year, I do think it implies a bit of a slowdown from what we saw in 2Q for the quarterly placements. Anything notable we should think about in terms of just the the gating of of placements through the rest of the year? Thanks so much.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Yeah. Good good morning, Chris. Thanks for that question and interview. The you know, from an, just a high level standpoint, the the feedback we're getting from customers on interview is is excellent. You know, it's really along two lines.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

One is it helps them with workflow. As we know, both, you know, ear cytology and blood morphology are things that are done in the practice today. They tend to be time intensive using microscopes, so that's fifteen to twenty minutes. The results are often inconsistent. And so what customers tell us is they appreciate not only the workflow benefits, but also the performance.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Getting consistent, highly accurate results is important. And, therefore, yeah, there there's been a lot of demand from it. We did update, as you mentioned, the 5,500, you know, placement forecast. We think that that's reasonable a reasonable assumption to take, the consumables usage across both ear cytology and blood morphology, tracking very well to to forecast it usage. We think when we release, the f and a lumps and bumps later on in the year, it'll continue to drive interest in in the platform and and continue to drive, you know, higher consumables usage.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

The the placement in terms of the overall profile of where we're placing, you know, in view, just as you would expect, It's a combination of, you know, suites for customers who don't have the fair chemistry and and hematology because it fits extremely well with hematology solutions, but also existing IDEXX customers who, you know, who have our suite but see the chance of doing ear cytology both, on the blood morphology side and also, as a complement to hematology and CBC, but also a new new testing category of ear cytology is is very, promising.

Chris Schott
Chris Schott
Managing Director at JP Morgan

Thank you.

Operator

We will take our next question from Erin Wright with Morgan Stanley.

Erin Wright
Erin Wright
Senior Equity Research Analyst - Healthcare at Morgan Stanley

Okay, great. I'll keep it on in view here. So can you talk a little bit about the contracts that coincide with the placements in terms of consumables agreements and the consumables flow through thereon? Like what's surprising you in terms of utilization? And and are you seeing better uptake from the mom and pops versus some chunkier corporate accounts in terms of how we think about that cadence in in terms of Chris' question earlier?

Erin Wright
Erin Wright
Senior Equity Research Analyst - Healthcare at Morgan Stanley

And then, you know, what I'm getting at here too is that, look, the the the consumables revenue growth kind of on an organic basis was probably the strongest in two years. I mean, how much was in view a contributor to that? Thanks.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Yeah. So let me let me take the last part of your question first. We we don't break out the consumables usage between the InVue and pancreatic lipase and some of the new catalyst specialty tests that we have. I I did mention that those were important contributors to our overall results. We we have seen nice volume growth, and I think it's just a reflection.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

We have a very large installed base of, like, Catalyst, for example, and our ability to to ramp that when we come out with a new test is something that over time with our commercial organization, you know, we've gotten better at. You know, in terms of placements, you know, getting back to independent practices for versus corporate practices. For corporate practices, there tends to be a little bit of a longer lead time in terms of they want to first, you know, pilot, but it could be you know, it could be a fairly sizable number of instruments that they wanna pilot before they place before they decide to, place, let's say, a new instrument like InVue at all of their their practices. Independent practices tend to move, you know, much more much more quickly. And, and that's that's not surprising.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

It's it's really just an in a one and, could assess, what they need. In, you know, in terms of usage, it's it's just as you would expect. You know, for these are very common clinical use cases. So if you take a look at ear cytology, most practices of a reasonable size, three or four veterinarians, will tell you that's something that they do pretty much on a daily basis. For for blood morphology, you know, most most practices, let's say an average practice at The US is doing approximately two chemistry and hematology tests a day.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

And we know in a majority of cases, they would, benefit from also adding a blood morphology to a CBC where they get an aberrant result or or something indicating the need to investigate further. So, you know, overall consumables usage is, is positive. It's it's in line with, where we thought it would be. And, the f and a lumps and bumps will only, I think, improve that over time when we come out with it.

Erin Wright
Erin Wright
Senior Equity Research Analyst - Healthcare at Morgan Stanley

Okay. Great. And then on guidance, what's reflected in terms of bed office visit trends now? What gets you to the high end, low end of the range? And what's given what's implied in the second half, how should we be thinking about the quarterly cadence here? Thanks.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Morning, Erin. Just in terms of the guide itself, we did highlight in the prepared remarks that we have updated clinical visits more in line with the recent trends that we've had. The past several quarters, we've been trending more in about the two and a half percent range. Yeah. I think about the midpoint reflecting, you know, approximately that that amount.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

You know, as you look at q two to q three or q four as an example with our second half implied growth expectations. Really, it's not a meaningful step up. I think we'll continue to benefit from, the building momentum that we have on innovation. As Jay highlighted, I think there's a lot of excitement around InVue. We were launched cortisol test last week within North America.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

We're still building on, pancreatic lipase and CancerDx as well. So we feel really good about, you know, kind of the momentum that we're building from an innovation and volume perspective within the business. And there's, you know, not a material step up in CAG Diagnostic recurring revenue that I think we've captured in our outlook.

Erin Wright
Erin Wright
Senior Equity Research Analyst - Healthcare at Morgan Stanley

Okay. Great. Thank you.

Operator

We will take our next question from Dan Clark with Leerink Partners.

Daniel Clark
VP - Equity Research at Leerink Partners

Great. Thank you. Good morning. Just had a question on how you're thinking about the longer term launch trajectory of InVue. Obviously, you took up the placement guide for this year, but is there any reason to think more positively about the trajectory here relative to StataView as an analog? Thank you.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Good morning, Dan. So we're not updating anything longer term at this point. Yeah. We have highlighted that we see an opportunity for a five year placement of approximately 20,000 for in view. I think we're off to a a really exciting, start here within 2025.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

You know, having a a a starting point, you know, within the year of 5,500 instruments, you know, positions us really well for that. Some of our other, instruments as SediVue or hematology may be slightly different just in terms of the categories that they, support. So we feel good about the longer term. We may provide updates, you know, within our, investor day in a couple weeks.

Operator

We will take our next question from Michael Ryskin with Bank of America.

Michael Ryskin
Michael Ryskin
Managing Director at Bank of America Merrill Lynch

Great. Thanks for taking the question. I want tie together a couple small follow ups. So first, just on the guide, I think you called out $90,000,000 increase reported, $70,000,000 of which is FX. Of the remaining $20,000,000 $10,000,000 is in view placements because you're saying $60,000,000 instead of $50,000,000 for that, if I if I've got my math right.

Michael Ryskin
Michael Ryskin
Managing Director at Bank of America Merrill Lynch

Just the remaining $10,000,000 is it just a a combination of different moving pieces? I know what you just said, you're assuming visits are a little bit weaker. Seems like price you reiterated. Just anything you can talk through on that last little bridge of the revenue guide so we can tie that off.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Good morning, Mike. This is Andrew. Yeah. Just in terms of how we think about the go forward, you highlighted it correctly. We have about $70,000,000 related to foreign exchange impacts, aligned with the rates that we have published in our our press release specifically.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Yeah. The other 20,000,000 is really operationally driven, and, you know, we certainly performed exceptionally well in Q2. We're really thinking about that continuing as we move forward, and we're expecting some momentum built with the innovation and the execution. We are investing back into the business as well, as Jay highlighted. We do plan to expand in three additional countries as well as modest expansion in The U.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

S. To continue to support our customers and grow volumes. And we see that as a pathway to achieve the other $20,000,000 of operational growth between our performance in Q2 and our outlook for the full year despite the fact that it does remain fairly dynamic. Clinical visits have been pressured. We've saw a decline of about 2.5% in Q2.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

And again, we're anticipated that, that trend continues for the remainder of the year.

Michael Ryskin
Michael Ryskin
Managing Director at Bank of America Merrill Lynch

Okay. And then on the on the in view consumable side, know you don't break it out or and you're not gonna quantify. You had talked about the the $355,500 range previously, but just when you place the instrument in the in the vet clinic, is there an initial bolus of consumables that goes with that, that's sort of sold in tandem with it? Do you start taking orders right away? Have you noticed is there know, can you talk about either the initial placement or maybe the initial ramp up of utilization?

Michael Ryskin
Michael Ryskin
Managing Director at Bank of America Merrill Lynch

I know you gave the 35 to 55 range previously, but just trying to think through how that played out in the quarter given the massive, box placements. I'm trying to see if there was anything tied in the consumables revenue to that. Thanks.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Yeah. Couple couple things, Mike. The the NVDX has a a paper run and auto replenishment capability with it so that as the customer, they they may purchase, you know, a couple couple sleeves to get started of the different cartridge types. But as the customer uses the the cartridges and as part of paper run, we are able to track that and then, obviously, auto ship replacements to it. So it's a you know, you you don't typically see a a big bolus at launch.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

One thing that we have gotten, I think, very good at as a as a company as part of the onboarding and training process is spending quality time with with a customer, making sure that that customer develops muscle memory in terms of how to use a how to use the instrument and get very comfortable with it so there's not a you know, typically a longer ramp to to get comfortable and and train everybody, perhaps, relative to historical benchmarks.

Michael Ryskin
Michael Ryskin
Managing Director at Bank of America Merrill Lynch

Okay. Thanks. I'll get back in the queue.

Operator

We will take our next question from Jon Block with Stifel.

Jonathan Block
Jonathan Block
Managing Director at Stifel Financial Corp

Thanks, guys. Good morning. Maybe just first one, any color on how things trended throughout the second quarter? And then maybe if you can just talk about the ongoing CAG DX recurring divergence, if you would, in the results between international and U US. International continues to be really solid US.

Jonathan Block
Jonathan Block
Managing Director at Stifel Financial Corp

I don't wanna say stuck in mid single digits, but still sort of mid single digit ish. Even though I believe some of the innovation is is maybe more prominent US versus the early days of international? And then I'll just ask my follow-up. Thank you.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Good morning, John. Nothing specific to call out and trends within the quarter. I think, you know, on our q one earnings call, we did highlight we're off to a a solid start within InView with six replacements. Yeah. I think beyond that, you know, nothing specific there that I I would indicate any material difference without the within the months or within the the week specifically.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

So I think we're we feel, like we're largely in track, you know, from a expectation standpoint, compared to our our results here. And then on CAG Diagnostic reoccurring, yeah, again, we do see really strong international growth. You know, they're still dealing with some macro and sector headwinds. I think some over The US, we don't have metrics to provide on, you know, some of the headwinds, you know, by country or or within the inter region there. But execution continues to perform exceptionally well as we commercialize some of the new products.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

And in The US, we have seen improvement. Yeah. I think if you look even on a days adjusted basis compared to q one, we've seen, you know, well over a 150 basis point increase in Q2. And again, I think that's largely the result of innovation ramping and our focus on really supporting our customers to drive testing. You see that play out within the diagnostic frequency and utilization within the sector metrics as well.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

We delivered about 50 basis point improvement on diagnostic frequency in q two. So, yeah, I think it it comes back to what we're focused on, which is executing, you know, across across the diagnostic solution set that we have and, you know, continue to partner with our customers on how to leverage diagnostics more effectively. John, maybe just one comment on US versus international. Typically, with a product launch, we we start in The US, so you do see some,

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

you know, the first traction is in our North American market and then international. And and with some tests, there may be regulatory or license requirements before we can sell in those those country markets. What what I would say is that for a lot of our specialty tests like pancreatic lipase, and it's probably gonna be true for for cortisol, there's very rapid uptake in our international markets. These are very technical markets with DVM sales organization. And so you can't neatly compartmentalize between US and and some of these international country markets. So there's really, I think, broad interest.

Jonathan Block
Jonathan Block
Managing Director at Stifel Financial Corp

Got it. That that was helpful. Thanks. And then maybe just to follow-up, you know, with if if you can follow the the different numbers. With price up four, visits down two and a half in the quarter, The the 02/2025 IDEX premium as we define it, it was up a solid 6% for February.

Jonathan Block
Jonathan Block
Managing Director at Stifel Financial Corp

So you can you talk to what reaccelerated the premium in February? And then arguably, like, why the guidance assumes it does not stick in the back part of 2025 and 02/2025. You know, considering you got these new innovations. Right? And they should be ramping.

Jonathan Block
Jonathan Block
Managing Director at Stifel Financial Corp

Like, the incremental from those innovations should be greater in February and specific to February as they build momentum. Yet, the premium again as we define it seems to be more modest in two h versus two q. And and hopefully some of that real time math made sense. Thanks, guys.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Yeah, John. I I I'm not entirely sure I follow all the math, but let me just, you know, take a step back and and highlight. Yeah. Think if if you take a look at, you know, how we performed in the second quarter, and then the implied, you know, second half guide, really, we're still in the same range, right? Our midpoint would suggest about a 9% growth on overall, organic revenue, and CAG Diagnostic recurring revenue of about 7.8% versus Q2 of about 7.4%.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

So we do anticipate that we'll benefit. We'll see some ramping benefits here in the second half. I think we've calibrated the impact of innovations as well as adjusted for the more recent trends for clinical visits. It does remain dynamic from a clinical visit perspective. We're not anticipating that's going to change at this point.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

But we are excited by the innovation that we're watching, including cortisol, which didn't have an impact in the second quarter. We began shipping that last week. You know, we're really focused on, you know, strong execution, you know, within our our areas of focus within diagnostic and software. Yeah. And I think we've factored that into our outlook.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Overall, we do expect some, you know, pricing benefit in the second half compared to the first half as well. We had noted on prior calls that we were gonna begin lapping, some of the larger agreements that we had last year, in this in the second quarter specifically, which should give us a little bit of uplift, on that as well. So I think, overall, we're well positioned. It does, remain to be a a pretty dynamic, environment that we're operating within, and and we're just staying calibrated for that.

Operator

As a reminder, if you would like to ask a question We'll take our next question from Ryan Daniels with William Blair.

Ryan Daniels
Group Head–Healthcare Technology and Services at William Blair & Company, L.L.C

Hey guys, good morning. Thanks for taking the question. Can you go a little bit more in-depth about some of the investments you're making in the sales force? I think it's the first time maybe in one years point or two years you're investing in The U. S.

Ryan Daniels
Group Head–Healthcare Technology and Services at William Blair & Company, L.L.C

And then for the other three markets, are those just additional investments? Or are those new countries that you're moving into? Thanks.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Yeah. Good good morning, Ryan. So for the international country markets, those those are existing markets that we participate in. And what we're doing with those investments is we we continue to increase the commercial density. Our international account management coverage tends to be much higher than what we see in The US.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

In The US, it's between a 110, 120 accounts per per BDC or account manager. Internationally, it's it's much higher than that. It obviously varies by country. We know that just like in The US and North America, when we call on customers, they grow faster. They use more diagnostics.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Of course, we benefit, you know, from that. These are investments in the entire ecosystem, so not just the the VDCs, but also professional service veterinarians in the field service representatives. And they go they go hand in hand with investments we've made in our reference lab network and software solutions like VetConnect Plus in terms of expanding menu in these international countries so that all the pieces are in place for for good growth. And what we typically find is, yeah, we we have a playbook. It's obviously localized by different country markets, but that we're able to to get a very nice ROI on on those investments in a fairly short period of of time.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

In in The US, we we have good account coverage. We do find that, you know, as we have increased the size of our overall portfolio in terms of point of care and reference labs and and software, being able to to support that selectively. We've done that. I guess it's been about eighteen months or so. We'll continue to do that.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Makes a lot of sense. It supports the productivity of our US Commercial Organization, which is also very, very high and enables us to really commercialize just a very rapid pace and and breadth of innovation that that we've had over the last couple years.

Ryan Daniels
Group Head–Healthcare Technology and Services at William Blair & Company, L.L.C

Okay. Perfect. Thank you for that. And then as a follow-up, I wanted to turn to the other kind of innovation this year in CancerDx and just hear your early feedback. I know you shared some commentary in your prepared comments, but curious if there's anything that surprised you about how it's being used either as part of a broader panel, at a lower price?

Ryan Daniels
Group Head–Healthcare Technology and Services at William Blair & Company, L.L.C

Or are they seeing more stand alone use as a individual diagnostic? It sounds like that might be coming from some competitive accounts in particular, I assume, where they're just purchasing that. So I'd love to get some color there. Thanks.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Sure. So, you know, we've had we've had a lot of enthusiasm from, customers and veterinarians, but also also pet owners. You know, a little bit surprising because we don't we don't directly market to pet owners. And I'd say we're we're right about where we thought we'd be. You know, the initial weighting is probably a bit more heavily weighted towards it aid in diagnosis.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

And and this isn't really surprising as with these type of novel new tests, what customers tend to do is they test the test for for performance. And the feedback has been very, very positive. You know, specificity as we've gotten more data is over 99%. Sensitivity, as we've disclosed earlier, is 79%. And we're achieving the published turnaround time, which is super, super important because pet owners don't wanna have to wait, you know, more than a couple days for for results.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

You know, I'd say that the number of independent practices and corporate groups who are using the test broadly in wellness screens, It it's still it's still low. It's very days. But I would say that they also have plans to be able to do that, and it's it's growing. And they see that as a way of of really pulling through broader wellness blood work. As we have disclosed, we have over 2,500 practices now using this.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Very, I think, pleased with the fact that about 15% of the submissions are coming from competitive practices. So there's fairly rapid uptake across the the entire, marketplace. Now keep in mind that this is canine lymphoma is just the first test of this broader venue. So as this panel expands, the offers can only grow in value, and we think, becoming, even more compelling.

Operator

We will take our next question from Nevan Tighe with BNP Paribas.

Navann Ty
Lead Analyst - Healthcare at BNP Paribas

Hi, good morning. One more on InVue. I'm curious whether the Salesforce has communicated to customers in q two that the FNA expansion was imminent? And then if possible, can you discuss revenue contribution for the first full quarter of cancer diagnostics? And maybe one last one, how is competition reacting to IMVU and cancer diagnostics? Thank you.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Yeah. So I think Andrew and I could will will share in this question. I'd say that, you know, we have broadly communicated to our customers that our beta will grow over time with f and a for lumps and bumps, you know, coming later this year. So that's not a secret. Customers, you know, are buying InVue based on existing and available menu, which is the ear cytology and and blood morphology.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

In in terms of the CancerDx, we don't break out the revenue. As I've mentioned, though, you know, it's it's right about where we thought it would be. We're very pleased with the uptake, and it's only, growing, and we think it'll have a, you know, multiplier benefit over time.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Yeah. I think, to to Jay's point, we're we haven't broken out any of the specifics associated with some of these newer innovations on the recurring revenue side, you know, we'll we'll continue to monitor that. And if it makes sense, we, may in the future. But, at this point, we're early in the launches. And, yeah, I think we're seeing really solid results that we expected, play out here as Jay highlighted, but nothing, additional to add at this time.

Navann Ty
Lead Analyst - Healthcare at BNP Paribas

Thank you. And maybe on competition, how they are reacting to IDEXX innovation, any near term launches in different or same areas? Thank you.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Yeah. I mean, that that hasn't really changed. It's it's a very competitive landscape. You know, we have to earn continue to earn our customers' loyalty. We compete on on every deal that's out there as do as do they.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

The you know, our growth algorithm really, I think, anticipates being able to grow by expanding the portfolio of testing solutions we offer our customers. These existing customers have a being able to provide this broader portfolio and and being able to grow with us is the primary means of of growing, and we continue to to focus on that. But the overall competitive landscape, hasn't changed much. Thank you.

Operator

We will take our last question from David Westenberg with Piper Sandler.

David Westenberg
David Westenberg
MD & Senior Research Analyst at Piper Sandler Companies

Hey. Thank you for taking the question. So I just wanted to ask maybe on international markets. Great job there. Can you talk about what's essentially been driving it between market growth, share gains versus just higher utilization slash customer support.

David Westenberg
David Westenberg
MD & Senior Research Analyst at Piper Sandler Companies

If you can give a kind of a flavor of which may which ones are maybe impacting that growth a little bit more. And then, you know, as a lot of people have pointed out, the the utilization consumables was great in the quarter. Did you see any, tariff related pull forward in Europe maybe, or or, internal markets, that happened in q two and just how we might wanna think about that for the rest of the year? Thank you.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Andrew, why don't you take the tariff question, and I'll take the international.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

Yeah. Dave, this is Andrew. On the tariff side, I I don't think we saw any meaningful change in order patterns from our our customers as Jay had highlighted, related to things like InVue DX. We do have a paper run approach, which means, you know, even if they were to, bring in some consumables, it's really at the time that they run it that we will record the revenue. So I think from that perspective, that's that's not necessarily something we've seen.

Andrew Emerson
Andrew Emerson
EVP, CFO and Treasurer at IDEXX Laboratories

And then on the lab side, certainly, you know, it's more local for local, type of revenue anyway. So I think we're we're not necessarily seeing any major impacts related to the trade landscape, you know, from a customer perspective at this point.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Yeah. Just in terms of the the international opportunity, keep in mind, you know, it's just using blood work inclusion as as a benchmark. It's a bit over a third of what we see in in The US. But the opportunity is just more embryonic in in terms of really working with with customers, supporting their priorities, and then driving the use of of diagnostics. It tends to be weighted a bit more towards sick patient testing versus wellness, so that varies, you know, by by market.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

And I think, being able to bring these solutions out to individual independent clinics that may just have a veterinarian or two veterinarians, our point of care solutions tend to be tailor made for that. I think we've done a very nice job from a product market fit. If you take a look at ProSci one, just from a cost and performance standpoint, it's very economical at lower usage rates, which which fits our international markets very well. So I think it's it's a combination of it's earlier days there. We have great product market fit.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

We've built out an infrastructure of both commercial reference labs, soft customer facing software tools like DeckConnect Plus, and really have, I think, like we've seen in The U. S. Over the last decades, driven a growing belief in the use of diagnostics that help them achieve their practice priorities. And so with that, we'll now conclude the Q and A portion of the call. Thank you for your participation and engagement this morning.

Jay Mazelsky
Jay Mazelsky
President, CEO & Director at IDEXX Laboratories

Once again, my pleasure to share how IDEXX executed against our organic growth strategy while delivering strong financial results in the second quarter. And so with that, we'll conclude the call. Thank you.

Operator

This concludes today's call. Thank you for your participation. You may now disconnect.

Executives
    • Andrew Emerson
      Andrew Emerson
      EVP, CFO and Treasurer
    • Jay Mazelsky
      Jay Mazelsky
      President, CEO & Director
Analysts
    • Executive
    • Chris Schott
      Managing Director at JP Morgan
    • Erin Wright
      Senior Equity Research Analyst - Healthcare at Morgan Stanley
    • Daniel Clark
      VP - Equity Research at Leerink Partners
    • Michael Ryskin
      Managing Director at Bank of America Merrill Lynch
    • Jonathan Block
      Managing Director at Stifel Financial Corp
    • Ryan Daniels
      Group Head–Healthcare Technology and Services at William Blair & Company, L.L.C
    • Navann Ty
      Lead Analyst - Healthcare at BNP Paribas
    • David Westenberg
      MD & Senior Research Analyst at Piper Sandler Companies
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