What Happened?
Shares of life sciences company Revvity (NYSE: RVTY) fell 2.4% in the afternoon session after it reported third-quarter financial results that showed a drop in profits and margins, even as revenue grew.
Revvity's revenue for the quarter increased 2.2% year-on-year to $698.9 million, meeting analysts' expectations. However, investors appeared to focus more on declining profitability. The company’s adjusted earnings per share fell to $1.18 from $1.28 in the same period last year. Furthermore, its operating margin contracted to 11.7% from 14.3% a year ago, indicating that expenses grew faster than sales. While Revvity slightly raised its full-year adjusted earnings forecast, the market's negative reaction suggested that concerns over the current quarter's profitability outweighed the updated outlook.
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What Is The Market Telling Us
Revvity’s shares are somewhat volatile and have had 11 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 17 days ago when the stock dropped 3.1% on the news that worries over worsening trade relations with China were triggered by critical comments from President Donald Trump. The president's tone and the suggestion of canceling a meeting with President Xi caused a rapid sell-off in the market. The trade dispute flared up after China imposed export controls on rare earth minerals, which are critical components for high-tech manufacturing. The escalation of the trade war raises concerns about supply chain disruptions and increased costs for technology companies, which are heavily reliant on global trade, leading to a broad sell-off in the sector.
Revvity is down 14.5% since the beginning of the year, and at $95.90 per share, it is trading 24.4% below its 52-week high of $126.84 from January 2025. Investors who bought $1,000 worth of Revvity’s shares 5 years ago would now be looking at an investment worth $753.23.
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