Diagnostics testing company Laboratory Corporation of America beat estimates for quarterly profit on Tuesday as the diagnostics test maker reported it was now processing some 180,000 Covid-19 tests a day in a bid to meet surging demand across the United States.
Shares of the Burlington, North Carolina-based company were up 2.4% at $206 before the bell.
A shortfall of adequate diagnostic testing and delay in processing timelines have hampered the U.S. response to the pandemic, which has so far infected more than 4 million Americans.
LabCorp, which offers antibody, neutralizing antibody and molecular tests for the coronavirus, has been struggling to expand capacity for its Covid-19 tests, like peer Quest Diagnostics that aims to run 150,000 tests per day by next month.
LabCorp said on Tuesday it has pulled up its turnaround time on results to two to three days on average, with faster results for hospitalized patients.
Last week, CEO Adam Schechter said turnaround times had climbed to three to five days for patients who were not in the hospital.
The company's diagnostics segment revenue fell 3.9% to $1.69 billion in the quarter. This was, however, offset by strong demand for its Covid-19 tests.
Demand for its non-Covid-19 tests continues to be below historical levels, but has been recovering from its trough in April, LabCorp said.
Sales in its Covance business, which carries out trials for drugmakers, fell by 2.9% to $1.09 billion.
LabCorp reported a $55.9 million government stimulus income related to the Coronavirus Aid, Relief, and Economic Security (CARES) Act in the reported quarter.
Excluding items and the CARES Act funds, LabCorp reported a profit of $2.57 per share, exceeding analysts' average estimate of $1 per share, according to Refinitiv IBES data.
Net revenue fell nearly 4% to $2.77 billion, but beat market estimates of $2.50 billion.