DURHAM, N.C. - Fortrea Holdings Inc. (NASDAQ:FTRE) shares surged 29% Friday after the contract research organization reported strong third quarter results, despite missing estimates, and updated its full-year revenue outlook.
For the third quarter ended September 30, Fortrea posted adjusted earnings per share of $0.23, which fell short of analyst estimates of $0.32. Revenue came in at $674.9 million, also missing estimates of $807M and down 5.4% year-over-year.
The company's book-to-bill ratio, a key industry metric, was strong at 1.23x for the quarter and 1.15x for the trailing 12 months.
"We had a solid quarter of execution," said Tom Pike, chairman and CEO of Fortrea. "Our book-to-bill ratio for the quarter, as expected, is a nice mix of both large pharma and biotech awards."
Fortrea raised its full-year 2024 revenue guidance to a range of $2.70 billion to $2.725 billion, up from its previous outlook. The company maintained its adjusted EBITDA guidance of $220 million to $240 million for the year.
Fortrea also reported progress on its post-spin separation from its former parent company, with over 90% of IT applications and servers migrated to Fortrea's environment.
For the first nine months of 2024, Fortrea generated $245.7 million in operating cash flow and $217 million in free cash flow.
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