Medical technology company Hologic (NASDAQ: HOLX) missed Wall Street’s revenue expectations in Q4 CY2025 as sales rose 2.5% year on year to $1.05 billion. Its non-GAAP profit of $1.04 per share was 5.4% below analysts’ consensus estimates.
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Hologic (HOLX) Q4 CY2025 Highlights:
- Revenue: $1.05 billion vs analyst estimates of $1.07 billion (2.5% year-on-year growth, 2.1% miss)
- Adjusted EPS: $1.04 vs analyst expectations of $1.10 (5.4% miss)
- Adjusted EBITDA: $330.4 million vs analyst estimates of $330.5 million (31.5% margin, in line)
- Operating Margin: 22.6%, in line with the same quarter last year
- Free Cash Flow Margin: 20.5%, up from 15.4% in the same quarter last year
- Constant Currency Revenue rose 1.3% year on year, in line with the same quarter last year
- Market Capitalization: $16.74 billion
Company Overview
As a pioneer in 3D mammography technology that has revolutionized breast cancer detection, Hologic (NASDAQ: HOLX) develops and manufactures diagnostic products, medical imaging systems, and surgical devices focused primarily on women's health and wellness.
Revenue Growth
A company’s long-term sales performance can indicate its overall quality. Any business can have short-term success, but a top-tier one grows for years. Hologic struggled to consistently generate demand over the last five years as its sales dropped at a 1.9% annual rate. This wasn’t a great result and is a sign of lacking business quality.
Long-term growth is the most important, but within healthcare, a half-decade historical view may miss new innovations or demand cycles. Hologic’s annualized revenue growth of 2% over the last two years is above its five-year trend, but we were still disappointed by the results. 
Hologic also reports sales performance excluding currency movements, which are outside the company’s control and not indicative of demand. Over the last two years, its constant currency sales averaged 1.7% year-on-year growth. Because this number aligns with its normal revenue growth, we can see that Hologic has properly hedged its foreign currency exposure. 
This quarter, Hologic’s revenue grew by 2.5% year on year to $1.05 billion, falling short of Wall Street’s estimates.
Looking ahead, sell-side analysts expect revenue to grow 5.1% over the next 12 months, an improvement versus the last two years. This projection is above average for the sector and indicates its newer products and services will spur better top-line performance.
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Operating Margin
Hologic has been an efficient company over the last five years. It was one of the more profitable businesses in the healthcare sector, boasting an average operating margin of 26%.
Looking at the trend in its profitability, Hologic’s operating margin decreased by 23.2 percentage points over the last five years, but it rose by 2.3 percentage points on a two-year basis. Still, shareholders will want to see Hologic become more profitable in the future.
This quarter, Hologic generated an operating margin profit margin of 22.6%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.
Earnings Per Share
We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
Sadly for Hologic, its EPS declined by 7.3% annually over the last five years, more than its revenue. This tells us the company struggled because its fixed cost base made it difficult to adjust to shrinking demand.
Diving into the nuances of Hologic’s earnings can give us a better understanding of its performance. As we mentioned earlier, Hologic’s operating margin was flat this quarter but declined by 23.2 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its lower earnings; interest expenses and taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.
In Q4, Hologic reported adjusted EPS of $1.04, up from $1.03 in the same quarter last year. Despite growing year on year, this print missed analysts’ estimates. Over the next 12 months, Wall Street expects Hologic’s full-year EPS of $4.28 to grow 9.5%.
Key Takeaways from Hologic’s Q4 Results
We struggled to find many positives in these results. Its revenue missed and its EPS fell short of Wall Street’s estimates. Overall, this quarter could have been better. The stock remained flat at $74.89 immediately following the results.
Hologic didn’t show it’s best hand this quarter, but does that create an opportunity to buy the stock right now? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here (it’s free).
