Quest Diagnostics Incorporated · NYSE:DGX
Quest Diagnostics — Investor Day (March 2025)
31 slides from Quest Diagnostics's investor day presentation, Mar 19, 2025
Slide 1: Investor Day 2025
Investor Day 2025 1 I N V E S T O R D A Y 2 0 2 5
Slide 2: Driving Sustainable Growth, Delivering Long-term Value
Driving Sustainable Growth, Delivering Long-term Value Jim Davis Chairman, CEO, and President
Slide 3: Safe harbor disclosure
Safe harbor disclosure The statements in this presentation which are not historical facts may be forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date that they are made and which reflect management's current esti
Slide 4: Key highlights
The clinical lab market is expected to remain strong driven by health trends and diagnostic innovation We have a proven strategy to generate above market growth in key channels Key highlights We expect our investments in advanced diagnostics to deliver double-digit revenue growth across 5 key clinic
Slide 5: We help people make the best decisions to improve health
We help people make the best decisions to improve health by providing high-quality and affordable diagnostic testing insights and services using our scale and extensive reach 5 I N V E S T O R D A Y 2 0 2 5
Slide 6: Quest is a leading provider of diagnostic information services
Quest is a leading provider of diagnostic information services ~8K 50% 1/3 ~217M patient access sites >90% ~5K US hospitals and US adults served requisitions of insured lives physicians served annually in 2024 in the US annually vehicles >80B >55K ~850 ~1,600 Global patient employees MDs/PhDs patent
Slide 7: Quest is well positioned in the nearly $90 billion US lab market
Quest is well positioned in the nearly $90 billion US lab market Physician Channel 2024 Total US Lab Market Hospital Channel $58B $89B $31B Quest POL Quest 6% 11% 12% Other Ind Hospital Labs 35% 14% Hospital Other Physician Outreach Independent 65% 35% Labs 42% Other Hospital 80% 2% - 4% CAGR 1% - 3
Slide 8: We are well positioned for growth in Canada's lab market
We are well positioned for growth in Canada’s lab market 2024 Total Canadian Lab Market ~$5B British Columbia LifeLabs Saskatchewan 13% Ontario Community Labs 8% • Leading provider of clinical laboratory testing in Canada 41M people • Headquartered in Toronto • 5 primary labs and 350 collection cent
Slide 9: Nearly 90% of our revenues come from physicians and hospitals
Nearly 90% of our revenues come from physicians and hospitals Other Patients 12% 12% Canadian Government 2% Hospitals Medicaid/Managed Medicaid ~$9.9B 20% 8% 13% administered Medicare/Medicare Advantage by Health Plans 2024 revenues 16% +6.7% Commercial Health Plans 27% growth year-over-year Physici
Slide 10: Macro trends continue to shape healthcare and favor Quest
Macro trends continue to shape healthcare and favor Quest Demographic Innovations Greater adoption Consumer focus shifts– in lab of AI and on prevention older, sicker diagnostics automation and wellness population 10 I N V E S T O R D A Y 2 0 2 5
Slide 11: The US population is growing older and sicker
The US population is growing older and sicker 74% 40% 52% 30% 79% of adults live of children live of adults have of teens have increase in with excess with excess prediabetes prediabetes early-onset weight or obesity weight or obesity or type 2 cancers diabetes Demographic 1 in 2 2%-12% Triple Tripl
Slide 12: The evolution in diagnostics is shaped by "power in the blood"
The evolution in diagnostics is shaped by “power in the blood” Innovations in lab diagnostics Technological advances are enabling a transition to clinical lab testing 12 I N V E S T O R D A Y 2 0 2 5
Slide 13: Automation and AI are improving quality and productivity
Automation and AI are improving quality and productivity Greater adoption Microbiology of AI and Cytology automation Parasitology Pathology 13 I N V E S T O R D A Y 2 0 2 5
Slide 14: Consumers are taking charge of their healthcare
Consumers are taking charge of their healthcare 54% ofinvolving “ individuals say holistic care options diet, exercise, and counseling are We are entering a new era either very or somewhat important to them of medicine… called bio-observability… the ability 65% of individuals say it is important tha
Slide 15: Macro trends continue to shape healthcare and favor Quest
Macro trends continue to shape healthcare and favor Quest Demographic Innovations Greater adoption Consumer focus shifts– in lab of AI and on prevention older, sicker diagnostics automation and wellness population 15 I N V E S T O R D A Y 2 0 2 5
Slide 16: Our strategy supports above market growth in key channels
Our strategy supports above market growth in key channels Physicians Hospitals Expand in high-growth areas 4% - 5% 5% - 6% >20% CAGR CAGR CAGR • Capitalize on expanded health • Serve hospitals through scaled • Drive growth in consumer-initiated plan network access reference testing testing • Extend
Slide 17: Our unique strengths will enable us to capitalize on physician market trends
Physicians Our unique strengths will enable us to capitalize on physician market trends 1 2 3 Scale Broad access Clinical (PSCs, IOPs) innovation 4 5 Health plan Value access PSCs: patient service centers; IOPs: in-office phlebotomists. 17 I N V E S T O R D A Y 2 0 2 5
Slide 18: We are leveraging our health plan access to increase our presence in new geographies
Physicians We are leveraging our health plan access to increase our presence in new geographies Over 1 million net new lives added Segmentation of top 50 MSAs High 14 20 MSAs MSAs >90% Growth potential of insured lives in the US 12 4 MSAs MSAs Low Low High Quest brand presence Expanding access with
Slide 19: We continue to expand our focus beyond independent physicians to include enterprise accounts
Physicians We continue to expand our focus beyond independent physicians to include enterprise accounts Physician employment trends Executives/Influencers Independent 26% 25% 22% 31% -11% CAGR 35% Corporate 23% entity 22% 22% 20% +8% CAGR • C-Suite, executive leaders, influencers of lab decisions 17
Slide 20: Hospitals continue to face headwinds and value scaled providers
Hospitals Hospitals continue to face headwinds and value scaled providers Wage and supply inflation Workforce shortages Cost of capital 20 I N V E S T O R D A Y 2 0 2 5
Slide 21: We have a diverse, collaborative approach for helping hospitals
Hospitals We have a diverse, collaborative approach for helping hospitals improve quality and efficiency, and access to capital Reference testing Collaborative Lab Outreach/JVs Solutions (CoLab) • Comprehensive menu • Access to capital to across the continuum • Professional lab invest in core assets
Slide 22: Our collaborative partnerships with hospitals are the largest opportunity to deliver above market growth
Hospitals Our collaborative partnerships with hospitals are the largest opportunity to deliver above market growth in the hospital channel Collaborative Lab Solutions (CoLab) Strong growth in CoLab revenue >$1B • Lab management $800M • Workforce +22% CAGR • Supply chain • Analytics ~$300M • Blood ma
Slide 23: We are positioned to deliver strong double-digit growth in key high-growth areas
Expand in high-growth areas We are positioned to deliver strong double-digit growth in key high-growth areas Consumer Life Sciences Analytics • ~$100M in revenue • ~$90M in revenue • ~$40M in revenue (direct sales + channel partners) • Phase I – IV decentralized • Cross channel • Questhealth.com con
Slide 24: Advanced diagnostic tests in 5 key clinical areas to deliver double-digit growth
Advanced Diagnostics We expect new and existing advanced diagnostic tests in 5 key clinical areas to deliver double-digit growth Oncology Advanced Women’s & Brain Autoimmune Cardiometabolic Reproductive Health Disorders Health Health • Haystack MRD • ApoB • QNatal® Advanced • AD-Detect • ANAlyzeR pr
Slide 25: We are focused on maximizing value from recent acquisitions
We are focused on maximizing value from recent acquisitions Completed 8 acquisitions in 2024 which are expected to generate ~$1 billion in annualized revenue Regional independent labs Health system outreach labs Capability-building assets • New York • Massachusetts • Tennessee • February 2024 • Febr
Slide 26: We continue to see robust opportunities for hospital outreach acquisitions
We continue to see robust opportunities for hospital outreach acquisitions Physician Channel $58B Hospital outreach labs comprise POL 11% Quest 12% ~$20B ~20 of the physician channel Hospital Other Outreach Independent 600+ 35% Labs 42% health systems deals completed by Quest in the last decade 26 I
Slide 27: We are also building strategic growth partnerships
We are also building strategic growth partnerships • Provides end-stage renal disease (ESRD) dialysis testing for over 2,600 dialysis centers in the US serving more than 200K patients • Building dialysis-related water testing capabilities • Leverages Quest’s national network to enable near-access se
Slide 28: Engaged people, lean processes and technology
Engaged people, People lean processes Customer-centric and and technology highly-engaged employees driving performance and innovation investments improve quality, productivity, and Enterprise Operations the customer experience Process Technology Lean, standardized, Automation, AI, and digital proces
Slide 29: We are transforming our order-to-cash process through Project Nova
We are transforming our order-to-cash process through Project Nova IT initiative will modernize underlying applications to improve customer experiences and lower IT costs Onboard Order Collect Transport Test Result Bill Service $ EMRs EMRs IDAA Ortec QSuite LIS EMRs QBS Salesforce Quanum® Quanum® QD
Slide 30: Key takeaways
The clinical lab market is expected to remain strong driven by health trends and diagnostic innovation We have a proven strategy to generate above market growth in key channels Key takeaways We expect our investments in advanced diagnostics to deliver double-digit revenue growth across 5 key clinica
Slide 31: Note on Non-GAAP Financial Measures
Note on Non-GAAP Financial Measures As used in this presentation the term “reported” refers to measures under accounting principles generally accepted in the United States (“GAAP”). The term “adjusted” refers to non-GAAP operating performance measures that exclude special items such as restructuring