Thermo Fisher Scientific Inc's second-quarter profit beat expectations on Wednesday, boosted by its unit which makes raw materials for COVID-19 vaccines as well as growth in its core scientific instruments business.
The company, which was one of the major providers of coronavirus tests during the pandemic, is banking on sustained demand for the raw materials to soften the blow from a widely expected slowdown in COVID-19 testing as vaccinations gain steam worldwide.
Revenue at Thermo Fisher's life sciences unit, which makes raw materials and provides tools and compounds for medical research, grew 37% to $3.56 billion in the second quarter.
Its Laboratory Products and Services business, another key revenue contributor through which the company offers clinical trial, drug manufacturing and packaging services, posted revenue of $3.58 billion, a 29% jump from the last year.
Organic revenue growth from the base business was 27% in the quarter, the world's largest maker of scientific instruments said. Revenue at its analytical instruments unit grew 41% to $1.48 billion.
Thermo Fisher generated COVID-19 response revenue of $1.9 billion in the quarter, $250 million above brokerage Evercore ISI's expectations, according to analyst Vijay Kumar.
The company has been investing in strengthening its vaccine manufacturing services and in June entered into a deal with Moderna to manufacture and package the latter's COVID-19 vaccine.
Thermo Fisher, earlier this year, acquired Groupe Novasep SAS's vaccine materials manufacturing business that helps make COVID-19 shots for AstraZeneca Plc and in April agreed to acquire contract researcher PPD Inc for $17.4 billion.
The company raised its 2021 revenue forecast by $300 million to $35.90 billion and now expects adjusted profit of $22.07 per share, compared to its previous outlook of $21.97 per share.
Excluding items, the company earned $5.60 per share, beating estimates of $5.44 per share.
(Reporting by Amruta Khandekar in Bengaluru; Editing by Shailesh Kuber) ((Amruta.Khandekar@thomsonreuters.com;))