QUEST DIAGNOSTICS INCDGX

QUEST DIAGNOSTICS INC Segments Disclosure

10-KFiled Feb 26, 20264 min read
BUSINESS SEGMENT INFORMATION
    The Company's DIS business is the only reportable segment based on the manner in which the Chief Executive Officer, who is the Company's CODM, assesses performance and allocates resources across the organization. The CODM uses the reported measure of segment profit (or loss) in assessing segment performance versus budget and when deciding how to allocate resources to segments. The DIS business provides diagnostic information services to a broad range of customers within its primary customer channels - physicians, hospitals, and patients and consumers. The DIS business accounted for greater than 95% of net revenues in 2025, 2024 and 2023.

    All other operating segments include the Company's DS businesses, which consist of its risk assessment services and healthcare information technology businesses. The Company's DS businesses offer solutions for insurers and offer solutions for healthcare providers and payers.
    
    As of December 31, 2025, substantially all of the Company’s services were provided within the United States and substantially all of the Company’s assets were located within the United States.

    The following table is a summary of segment information for the years ended December 31, 2025, 2024 and 2023. Segment asset information is not presented since it is not received by the CODM at the operating segment level. The CODM regularly reviews certain consolidated expenses, including employee compensation costs. "Other segment items" principally consist of costs for obtaining, transporting and testing specimens, facility costs used for the delivery of the Company's services, costs associated with the Company's sales and marketing efforts, and costs related to billing operations. Operating income (loss) of each segment represents net revenues less directly identifiable expenses. General corporate activities included in the table below are comprised of general management and administrative corporate expenses, amortization and impairment of intangibles assets and other operating income and expenses, net of certain general corporate activity costs that are allocated to the DIS and DS businesses. The accounting policies of the segments are the same as those of the Company as set forth in Note 2.
2025
DISTotal
Net revenues$10,785 $10,785 
DS revenues250 
Total net revenues$11,035 
Less: Other segment items(8,956)
Segment operating income$1,829 $1,829 
DS operating income32 
General corporate activities(305)
Total operating income1,556 
Non-operating expense, net(238)
Income before income taxes and equity in earnings of equity method investees1,318 
Income tax expense(314)
Equity in earnings of equity method investees, net of taxes42 
Net income1,046 
Less: Net income attributable to noncontrolling interests54 
Net income attributable to Quest Diagnostics$992 
2024
DISTotal
Net revenues$9,614 $9,614 
DS revenues258 
Total net revenues$9,872 
Less: Other segment items(7,984)
Segment operating income$1,630 $1,630 
DS operating income33 
General corporate activities(317)
Total operating income1,346 
Non-operating expense, net(171)
Income before income taxes and equity in earnings of equity method investees1,175 
Income tax expense(273)
Equity in earnings of equity method investees, net of taxes19 
Net income921 
Less: Net income attributable to noncontrolling interests50 
Net income attributable to Quest Diagnostics$871 
2023
DISTotal
Net revenues$8,976 $8,976 
DS revenues276 
Total net revenues$9,252 
Less: Other segment items(7,429)
Segment operating income$1,547 $1,547 
DS operating income34 
General corporate activities(319)
Total operating income1,262 
Non-operating expense, net(132)
Income before income taxes and equity in earnings of equity method investees1,130 
Income tax expense(248)
Equity in earnings of equity method investees, net of taxes26 
Net income908 
Less: Net income attributable to noncontrolling interests54 
Net income attributable to Quest Diagnostics$854 

    Depreciation and amortization expense for the years ended December 31, 2025, 2024 and 2023 were as follows:
    
202520242023
DIS business$400 $352 $319 
All other operating segments14 13 11 
General corporate156 128 109 
Total depreciation and amortization$570 $493 $439 
    Capital expenditures for the years ended December 31, 2025, 2024 and 2023 were as follows:
202520242023
DIS business$514 $410 $398 
All other operating segments10 7 8 
General corporate3 8 2 
Total capital expenditures$527 $425 $408 

    The approximate percentage of net revenues by major service for the years ended December 31, 2025, 2024 and 2023 was as follows:
202520242023
Routine clinical testing and other services54 %51 %51 %
COVID-19 testing services— 1 2 
Gene-based and esoteric (including advanced diagnostics) testing services38 39 38 
Anatomic pathology testing services6 6 6 
All other2 3 3 
Net revenues100 %100 %100 %

    The approximate percentage of net revenues by customer channel for the years ended December 31, 2025, 2024 and 2023 was as follows:

202520242023
Physician lab services71 %68 %66 %
Hospital lab services18 20 21 
Other DIS9 9 10 
Total DIS revenues98 97 97 
DS revenues2 3 3 
Total net revenues100 %100 %100 %

    Physician lab services includes net revenues for physicians including those associated with ACOs and FQHCs.

About Segments Disclosures

Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.

Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.

Other Available Disclosures

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