ICON Earnings: Delayed Trials Affect Revenue in the Near Term; Positive Long-Term Outlook

Icon reported second-quarter results highlighted by revenue of $2.1 billion, representing a nearly 5% increase from the prior-year period. However, management reduced its 2024 revenue guidance by 1.2% at the midpoint because of the impact of the strengthening US dollar and delayed trial starts related to next-generation covid vaccine work. These delays were due to a lag in sponsors receiving regulatory guidance that was required before commencing trial enrollment for new variants. Additionally, there were investigational product-related issues that caused a delay in enrollment. Management reassured investors that these studies have not been canceled, and it expects the trials will enroll the majority of patients in 2025. Delayed trial starts can happen for a variety of reasons, and we are not too concerned about it. Icon's performance has been solid, and excluding covid, revenue has grown 8% for the year to date over the first half of 2023.