QuidelOrtho (QDEL) Strategy Update summary

Strategic realignment and portfolio update

• Announced intention to acquire full ownership of LEX Diagnostics for approximately $100 million upon FDA clearance, with up to $40 million in potential earnouts over six years, expected late 2025 or early 2026.

• Discontinued development of the Savanna platform due to underperformance in clinical trials and high incremental investment required, with an orderly transition plan for customers and partners.

• LEX Diagnostics offers a rapid molecular platform delivering positive results in about six minutes and negatives in ten for Flu A, Flu B, and COVID, with future menu expansion planned.

• LEX platform integrates seamlessly into point-of-care workflows, providing PCR-level sensitivity, ease of use, and competitive pricing.

• Decision driven by comprehensive review of clinical performance, market potential, and strategic fit within the point-of-care portfolio.

Market opportunity and commercial strategy

• Molecular diagnostics market is valued at roughly $9 billion, growing in low double digits, with a shift from centralized to decentralized testing.

• LEX targets the fast-growing decentralized segment, offering speed, sensitivity, and cost advantages over competitors.

• Initial launch planned for 2026 with Flu A, Flu B, and COVID assay, followed by menu expansion to group A strep, RSV, women's health, and other assays.

• Faster commercialization path anticipated, with 510(k) and CLIA-waiver applications to be submitted soon.

• Reallocation of resources from Savanna to LEX Diagnostics expected to enhance long-term growth and shareholder value.

Financial guidance and impact

• Acquisition to be funded with cash and revolving credit; no change to debt leverage targets or capital allocation priorities.

• One-time non-cash write-off of $130–$150 million related to Savanna assets, not expected to impact adjusted EBITDA or EPS guidance for 2025.

• Annualized P&L benefit of $25 million expected from discontinuing Savanna, with $11 million realized in the second half of 2025.

• Full-year 2025 revenue guidance reaffirmed at $2.60B–$2.81B, adjusted EBITDA of $575M–$615M, and adjusted EBITDA margin of 22%.

• Adjusted diluted EPS projected at $2.07–$2.57 for 2025.