01—Abstract
Summary
Summary of the 10-Q filed September 6, 2017. Cited figures are marked; the original filing is the authoritative source.
Agilent Technologies, Inc. reported solid financial performance for the nine months ended July 31, 2017, demonstrating revenue growth across its key business segments and an improvement in profitability.
Total net revenue increased by 6% year-over-year to $3.3 billiona, driven by a 5% increase in Life Sciences and Applied Markets, a 9% increase in Diagnostics and Genomics, and a 7% increase in Agilent CrossLab. Net income saw a significant rise to $507 million, up from $336 million in the prior year period, reflecting improved gross margins and operational efficiencies. The company's balance sheet remains strong, with cash and cash equivalents totaling $2.56 billion as of July 31, 2017.
Agilent continues to focus on returning value to shareholders through dividends and share repurchases, while also investing in research and development to fuel future growth. The company made strategic acquisitions of Multiplicom NV and Cobalt Light Systems, which are expected to contribute to its diagnostics and applied markets businesses.
02—Key points
Key Highlights
- Total net revenue increased by 6% to $3.3 billion for the nine months ended July 31, 2017, compared to the prior year period.
- Net income grew significantly to $507 million for the nine months ended July 31, 2017, up from $336 million in the prior year.
- Life Sciences and Applied Markets revenue grew 5%, Diagnostics and Genomics revenue grew 9%, and Agilent CrossLab revenue grew 7% for the nine months ended July 31, 2017.
- Gross margin improved by 2 percentage points to 53.7% for the nine months ended July 31, 2017.
- Operating margin expanded by 5 percentage points to 18.5% for the nine months ended July 31, 2017.
- Cash and cash equivalents stood at $2.56 billion as of July 31, 2017, indicating strong liquidity.
- The company completed two strategic acquisitions: Multiplicom NV for $72 million and Cobalt Light Systems for $53 million.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2017, Agilent Technologies, Inc. kept $0.16.
- Revenue$1.11B100.0%
- Cost of revenue−$518.0M46.5%
- Gross profit$596.0M53.5%
- Operating costs−$395.0M35.5%
- Operating income$201.0M18.0%
- Interest, other & tax−$26.0M2.3%
- Net income$175.0M15.7%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2017filed September 6, 2017Financial Statements
Q3 FY2017 against Q3 FY2016
| Line item | Q3 FY2017Q3 FY2016 | Change |
|---|---|---|
| Revenue | $1.11B$1.04B | +6.7% |
| Cost of Revenue | $518.00M$502.00M | +3.2% |
| Gross Profit | $596.00M$542.00M | +10.0% |
| R&D Expenses | $87.00M$86.00M | +1.2% |
| SG&A Expenses | $308.00M$310.00M | −0.6% |
| Operating Expenses | $913.00M$898.00M | +1.7% |
| Operating Income | $201.00M$146.00M | +37.7% |
| Interest Expense | $19.00M$17.00M | +11.8% |
| Net Income | $175.00M$124.00M | +41.1% |
| EPS (Basic) | $0.55$0.38 | +44.7% |
| EPS (Diluted) | $0.54$0.38 | +42.1% |
| Shares Outstanding (Basic) | 321.00M325.00M | −1.2% |
| Shares Outstanding (Diluted) | 326.00M328.00M | −0.6% |
05—Questions
Frequently Asked Questions
What is the overall financial performance of Agilent Technologies in the reported period?
Agilent Technologies demonstrated strong performance with a 6% increase in net revenue to $3.3 billion for the nine months ended July 31, 2017, and a substantial rise in net income to $507 million. Profitability improved significantly, with gross margin increasing to 53.7% and operating margin rising to 18.5%.
How did the different business segments perform?
All three reportable segments showed revenue growth. Life Sciences and Applied Markets grew by 5%, Diagnostics and Genomics by 9%, and Agilent CrossLab by 7% for the nine months ended July 31, 2017. This indicates broad-based demand for Agilent's offerings.
What is the company's financial health and capital position?
Agilent maintains a strong financial position, with $2.56 billion in cash and cash equivalents as of July 31, 2017, indicating robust liquidity. The company generated $601 million in cash from operating activities during the nine-month period, sufficient to cover investments, financing activities, and shareholder returns.
What significant strategic moves did Agilent make during the period?
Agilent completed two key acquisitions: Multiplicom NV for $72 million, a European diagnostics company, and Cobalt Light Systems for $53 million, a provider of Raman spectroscopic instruments. These acquisitions are expected to bolster the company's presence in its target markets.
06—Continue