DURHAM, N.C. – Fortrea Holdings Inc. (NASDAQ:FTRE), the global contract research organization, reported disappointing first-quarter results, with both earnings and revenue falling short of Wall Street expectations.
The company’s adjusted loss per share was -$0.04, well below analysts’ estimates of $0.19. Revenue also missed the mark, coming in at $662.1 million versus the consensus estimate of $776 million. Shares fell 5.9% after the report.
Compared to the same period last year, Fortrea’s revenue was down from $693.9 million, down about 4.6% year over year. The company’s GAAP net loss widened to $81.6 million, a sharp contrast to the $7.3 million GAAP net income reported in the first quarter of 2023. Adjusted EBITDA for the quarter was $29.5 million, compared to $41.7 million year-over-year.
Tom Pike, chairman and CEO of Fortrea, acknowledged the challenges of spinning off the company in 2023, but remained optimistic about the demand for their services and the company’s operational strength. He highlighted the company’s commitment to gaining momentum before the end of the year, as well as the progress made in the sale of its Endpoint Clinical and Patient Access divisions.
Looking ahead, Fortrea provided full-year 2024 revenue guidance of $2.785 billion to $2.855 billion, missing the analyst consensus of $3.08 billion. The midpoint of that guidance range, $2.82 billion, is well below the consensus estimate. This year’s adjusted EBITDA guidance is set at $240.0 million to $260.0 million.
The company’s financial results have been updated to reflect continuing operations only and have revised expected results to reflect foreign currency exchange rates as of December 31, 2023. As of March 31, 2024, Fortrea had a backlog of $7.4 billion in book value to notes ratio. 1.11x for the quarter, indicating healthy future business flow.
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