IDEXX Laboratories Highlights Diagnostic Pipeline, Reaffirms Long-Term Growth Targets

IDEXX reaffirmed its long-term growth targets of more than 10% organic revenue growth and more than 15% EPS growth, supported by recurring-revenue momentum and a large, underpenetrated veterinary diagnostics market.

Despite an expected roughly 1.5% decline in veterinary visits in the second half, the company sees favorable trends from a growing and aging pet population, increased medicalization and higher diagnostic utilization.

Growth initiatives include expanding the inVue Dx cytology platform, launching additional Catalyst tests, broadening Cancer Dx into a multi-cancer panel and investing in commercial teams, while maintaining a full-year comparable operating margin target above 32%.

IDEXX Laboratories NASDAQ: IDXX executives highlighted the company’s diagnostic innovation pipeline, recurring-revenue growth and commercial investments during the Morgan Stanley Global Healthcare Conference, while reaffirming confidence in its long-term growth framework despite continued pressure on veterinary office visits.

Chief Executive Officer Mike Erickson said the company had an “exceptional” second quarter and a strong start to the year, supported by double-digit growth in reference laboratory recurring revenue and VetLab recurring revenue.

IDEXX raised its full-year outlook following the quarter, he said, citing momentum from innovation across point-of-care diagnostics, reference laboratories and software.

The company continues to target more than 10% organic revenue growth and more than 15% earnings-per-share growth over the long term.

Erickson said IDEXX sees a $45 billion global diagnostics total addressable market and believes testing remains underpenetrated relative to the value it creates for veterinary practices.

“Pets can’t speak. It’s diagnostics that give them a voice in the healthcare equation,” Erickson said, adding that diagnostics drive 80% of activity within a veterinary practice.

IDEXX’s guidance incorporates a decline in clinical veterinary visits, with Chief Financial Officer Andrew Emerson saying the company expects approximately a 1.5% decline in visits during the second half at the midpoint of its outlook.

The company had previously anticipated declining visits in 2026, although results in the first half were somewhat better than expected, he said.

Erickson said weakness in visits has been concentrated more heavily in wellness care, which may be viewed as more discretionary than non-wellness visits.

However, he pointed to a larger pet population, more medicalized pets and higher total visit volumes than before the pandemic.

He said the number of pets in the system has increased by 22 million since before the pandemic, while the number of medicalized pets has increased by roughly 8 million to 9 million.

IDEXX also sees positive visit growth for pets older than five years, reflecting the aging of pets adopted during the pandemic.

Beyond visit counts, Erickson emphasized the quality and intensity of care delivered during appointments.

The company said bloodwork inclusion in wellness visits has increased by about 50 basis points annually across the sector.

Bloodwork is included in about one in five overall visits and approximately 13% of U.S. wellness visits, according to Erickson, with lower inclusion internationally.

Dogs and cats are also living roughly 1.5 years longer than they did a decade ago, representing about a 12% increase in lifespan, Erickson said.

Because older pets require more care,...