IQVIA Holdings Inc. (IQV) Q4 2025 Earnings Call Transcript
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Overview
The earnings call summary highlights strong financial performance, including revenue and EPS growth, alongside strategic acquisitions and AI integration. The Q&A section reveals management's confidence in AI as an opportunity rather than a threat, despite some lack of clarity. The company's guidance is optimistic, with no major negative indicators, suggesting a positive stock price reaction.
Key Financial Performance
Full Year Revenue Growth 6% year-over-year. Reasons: Despite macroeconomic challenges, slower customer decision-making, and tempered biotech funding, the environment stabilized later in the year, and demand indicators became more favorable.
Adjusted Diluted Earnings Per Share Growth 7% year-over-year. Reasons: Strong operational performance and stabilization in demand indicators.
Free Cash Flow $2.1 billion, representing about 100% of adjusted net income. Reasons: Strong operational cash generation.
Fourth Quarter Revenue $4.364 billion, up 10.3% reported and 8.1% at constant currency. Reasons: 2 points of growth from acquisitions and improved customer trends.
Fourth Quarter Adjusted EBITDA $1.046 billion, up 5% year-over-year. Reasons: Improved operational efficiency and revenue growth.
Fourth Quarter Adjusted Diluted EPS $3.42, up 9.6% year-over-year. Reasons: Revenue growth and operational improvements.
Net Bookings (Clinical Side) $2.7 billion, growing 7% year-over-year. Reasons: Improved customer trends and solid sales execution.
Backlog $32.7 billion, up 5.3% year-over-year. Reasons: Strong demand and improved funding environment.
Technology & Analytics Solutions (TAS) Fourth Quarter Revenue $1.821 billion, up 9.8% reported and 7.1% constant currency. Reasons: Resilience of the commercial portfolio.
R&D Solutions Fourth Quarter Revenue $2.333 billion, up 9.1% reported and 8.2% constant currency. Reasons: Excluding COVID-related work, growth was over 8.5% at constant currency.
Contract Sales and Medical Solutions (CSMS) Fourth Quarter Revenue $210 million, up 18.6% reported and 15.3% constant currency. Reasons: 5 points of growth due to acquisitions.
Full Year Revenue $16.310 billion, up 5.9% reported and 4.8% constant currency. Reasons: Growth across segments, including acquisitions.
Full Year Adjusted EBITDA $3.788 billion, up 2.8% year-over-year. Reasons: Operational improvements and revenue growth.
Full Year Adjusted Diluted EPS $11.92, up 7.1% year-over-year. Reasons: Revenue growth and operational efficiency.
Free Cash Flow (Full Year) $2.51 billion, representing 99% of adjusted net income. Reasons: Strong operational cash generation.
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Operating Highlights
Phase I trial capabilities: Acquired a facility in the U.K. to test new drugs in healthy volunteers.
Science management organization: Expanded with the acquisition of NEXT Oncology, focusing on early-stage oncology trials.
DaaS (Data-as-a-Service): Increased demand among large and midsized pharma clients for AI-ready data solutions.
IQVIA Patient Experience platform: Launched to digitize patient support programs, already adopted by 6 new customers.
Marburg Vaccine doses: Provided 640 doses to Ethiopia for a Phase II trial during the nation's first outbreak.
Cedar Gate Technologies: Acquired to enhance capabilities in patient solutions and payer analytics.
Commercial outsourcing in Asia: Won the first full-service commercial outsourcing deal with a large pharma client in Asia.
AWS collaboration: Partnered with Amazon Web Services to accelerate digital transformation in life sciences.
AI-driven innovations: Gaining momentum with large pharma clients for analytics and AI solutions.
Revenue growth: Achieved 10.3% year-over-year growth in Q4 2025, with acquisitions contributing 2 points.
Net bookings: Totaled over $2.7 billion in Q4, growing 7% year-over-year.
Backlog: Reached a record $32.7 billion, growing 5.3% year-over-year.
Segment reorganization: Simplified into two segments: Commercial Solutions and R&DS, aligning with industry evolution.
AI leadership: Recognized by Everest Group as #1 in generative AI leadership in life sciences.
Organizational simplification: Reorganized to strengthen collaboration and enhance efficiency.
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Risk or Challenges
Macroeconomic and Government Policy Uncertainty: The company faced significant challenges due to heightened uncertainty around macroeconomic and government policy, which led to slower customer decision-making and tempered biotech funding, impacting R&DS bookings and revenue earlier in the year.
Interest Rate Pressures: Continued pressure from interest rates affected the company's financial environment, contributing to slower customer decision-making and funding challenges.
Trial Cancellations: The fourth quarter saw cancellations slightly above the normal range due to specific idiosyncratic aspects of certain trials, which could impact revenue and operational efficiency.
Increased Net Interest Expense: Net interest expense is expected to increase by approximately $80 million in 2026 due to the full-year impact of senior notes issued in 2025, swap maturities, and refinancing activities, which could strain financial performance.
Foreign Exchange Volatility: The company’s financial performance is subject to foreign exchange rate fluctuations, which could impact revenue and profitability.
Operational Complexity: The company is undergoing organizational simplification to align with evolving client purchasing behaviors, which may pose transitional challenges and risks to operational efficiency.
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Guidance & Outlook
Revenue Guidance for 2026: Revenue is expected to be between $17.150 billion and $17.350 billion, including approximately 150 basis points of contribution from M&A and 100 basis points of tailwind from foreign exchange.
Adjusted EBITDA Guidance for 2026: Expected to be between $3.975 billion and $4.025 billion.
Adjusted Diluted EPS Guidance for 2026: Guided to be between $12.55 and $12.85.
Segment Revenue Guidance for 2026: Commercial Solutions revenue is expected to be between $7.2 billion and $7.3 billion, representing growth of approximately 7% to 9%. RDS revenue is expected to be between $9.9 billion and $10 billion, representing a little over 4% growth year-over-year at the midpoint.
First Quarter 2026 Guidance: Revenue is expected to be between $4.050 billion and $4.150 billion. Adjusted EBITDA is expected to be between $920 million and $940 million. Adjusted diluted EPS is expected to be between $2.77 and $2.87.
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Shareholder Return Plan
Share Repurchase: In the quarter, we repurchased $212 million of shares, bringing our full year share repurchase activity to $1.244 billion at an average price of $159 per share.
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Key Q&A
Q:What are the concerns about AI disrupting established businesses, and how is IQVIA insulated from these disruptions?
A:Ari Bousbib explained that IQVIA has been working on AI for a long time, partnering with NVIDIA to integrate AI into workflows. He emphasized that IQVIA's proprietary health care data is not publicly available and is curated, de-identified, and integrated into data lakes. He highlighted the complexity and regulatory requirements of health care data, which make it difficult to replicate. He also noted that IQVIA's domain expertise and scale make it a trusted partner for clients. AI is seen as an opportunity to enhance business rather than a threat.
Q:What is the value and driver of the Cedar Gate acquisition, and how does it fit into IQVIA's ecosystem?
A:Ari Bousbib stated that Cedar Gate transforms health care data into insights for improved patient outcomes and provides analytics to payers. It has a strong technology platform and scale, with $125 million in revenue and $33 million in adjusted EBITDA in 2024. Cedar Gate's data includes 4 petabytes and covers 60 million lives. The acquisition expands IQVIA's solutions and has synergies with its data analytics and technology business.
Q:Is AI an opportunity or risk for IQVIA's business, and how does it impact growth?
A:Ari Bousbib reiterated that AI is a positive for IQVIA, enhancing productivity and enabling clients' AI initiatives. IQVIA's proprietary data and domain expertise are integral to its value proposition. He emphasized that AI will augment rather than replace IQVIA's role. The demand metrics for RDS are strong, and the company expects to maintain growth and market share.
Q:Have there been any changes in large pharma's behavior regarding AI and trial efficiency?
A:Ari Bousbib stated that there have been no changes in large pharma's behavior. Large pharma's AI efforts are focused on early-stage drug discovery, which does not impact IQVIA's business. He noted that AI is used to improve trial efficiency, and IQVIA partners with clients in these efforts. Demand dynamics remain stable, and there are opportunities for productivity improvements.
Q:What is the trajectory of pass-throughs, and how does it affect margins?
A:Ronald Bruehlman explained that strong pass-through growth was the main driver of gross margin decline in the fourth quarter. Pass-through growth is expected to moderate in 2026. Productivity gains have offset some of the impact, and SG&A margin improvements are contributing to overall stability.
Q:Review of Unclear Management Responses
A:Management avoided directly addressing the specific financial impact of AI on IQVIA's business, particularly in terms of potential risks or disruptions. Responses were broad and focused on the positive aspects of AI without providing detailed data or clarity on potential challenges.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
AI life
AI planning
AWS
CSMS segment
Commercial Solutions
DaaS
IQVIA ability
IQVIA service
Late Phase
Real World
Solutions CSMS
Solutions currency
TAS segment
World Late
acquisition
adherence
analytics solution
capability
currency point
development program
enterprise
flow income
model
moment
offering TAS
offering trial
oncology
planning tool
program IQVIA
reporting segment
role
row IQVIA
science
segment Commercial
win pharma
world company
world offering
IQV Transcript
IQVIA Holdings Inc. (IQV) Q4 2025 Earnings Call Transcript
Positive2-5
The earnings call summary highlights strong financial performance, including revenue and EPS growth, alongside strategic acquisitions and AI integration. The Q&A section reveals management's confidence in AI as an opportunity rather than a threat, despite some lack of clarity. The company's guidance is optimistic, with no major negative indicators, suggesting a positive stock price reaction.
IQVIA Holdings Inc. (IQV) Presents at UBS Global Healthcare Conference 2025 Transcript
Neutral11-11
IQVIA Holdings Inc. (IQV) Q3 2025 Earnings Call Transcript
Positive10-28
The company's earnings call reveals a steady financial performance with strong growth in technology and analytics solutions. Despite some uncertainties, the 'see more, win more' strategy and AI advancements are positive indicators. The Q&A section shows management's confidence in future growth and minimal P&L implications from strategic initiatives. The lack of specific guidance for 2026 is a minor concern, but overall, the positive growth trends and strategic developments suggest a positive stock price movement.
IQVIA Holdings Inc. (IQV) Q2 2025 Earnings Call Transcript
Positive7-22
The earnings call summary and Q&A indicate positive sentiment: revenue growth, raised full-year revenue guidance, and strong AI deployment progress. Despite some margin compression and uncertainties, the company's proactive strategies and improved win rates in key segments support a positive outlook. The raised guidance and strategic partnership are strong catalysts for stock price increase, likely resulting in a positive movement (2% to 8%) over the next two weeks.
IQV Slides
IQV Report
Frequently Asked Questions
Where does this earnings call transcript come from?
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
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No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
Why do some answers appear as “Unclear” or “Inaudible”?
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
Who creates the AI Summary and Key Q&A highlights shown above the transcript?
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
