QuidelOrtho (QL1A) Q2 2026 Earnings Report

The call conveyed a mixed picture: solid underlying operational performance outside China (mid-single-digit growth ex-China, strong regional results, 21% YoY adjusted EBITDA growth, and margin expansion) and tangible progress on the Lex/Neulixa commercialization. Offsetting these positives were significant near-term headwinds — a 23% revenue decline in China driven by IVD pricing uncertainty, a softer respiratory season, negative operating and free cash flow in the quarter, withdrawal of free-cash-flow guidance, and elevated leverage (4.3x). Management emphasized disciplined cost actions, cash-conversion priorities, and mitigation plans, but the combination of China uncertainty and weak respiratory demand creates meaningful short-term risk even as core franchises remain resilient.

The company updated full‑year 2026 guidance to revenue of $2.52–$2.60 billion, adjusted EBITDA of $540–$560 million (21%–22% margin) and adjusted EPS of $0.65–$0.90, while withdrawing free‑cash‑flow guidance due to China and respiratory uncertainty; this reflects Q2 results of $631 million revenue (+2% CC; +6% ex‑China), China down 23%, labs ex‑China +9%, immunohematology ex‑China +5%, Triage +9%, regional growth of North America +6%, JPAC +10% and Latin America +8%, Q2 adjusted EBITDA $129 million (+21%) with EBITDA margin 20% (+310 bps), adjusted gross margin 44.4% (‑130 bps), combined non‑GAAP SG&A and R&D $219 million (+2%, improving 40 bps as a percent of revenue), Q2 adjusted EPS $0.13, cash $123 million, $250 million drawn on the revolver, operating cash flow ‑$111 million and free cash flow ‑$136 million (including a $25 million Grifols payment), $97 million cash deployed for the Lex acquisition, and net leverage of 4.3x adjusted EBITDA, with management assuming roughly 3%–5% H2 growth for core labs and immunohematology and preparing for persistent China pressure and a muted respiratory season.