Ladies and gentlemen, thank you for standing by. I am Katie, your call operator. Welcome, and thank you for joining QIAGEN's Q3 2024 Earnings Conference Call Webcast [Operator Instructions]. At this time, I'd like to introduce your host, John Gilardi, Vice President, Head of Corporate Communications and Investor Relations at QIAGEN. Please go ahead.

So thank you, operator. And thank you to all of you for joining us for our quarterly results call. We're pleased to have you with us and appreciate your interest in QIAGEN. This call is being webcast live and will be archived in the IR section of our Web site. You can also find a copy of the quarterly results, press release and the presentation on our Web site. Now I'd like to remind everyone that we will be discussing forward-looking statements on this call. Actual results may differ materially from those projected in any statements that we make. The factors that could cause our actual results to differ materially are discussed in our most recent Form 20-F on file with the SEC and also available on our Web site. In addition, we will be referring to certain financial measures not prepared following generally accepted accounting principles or GAAP. We believe these non-GAAP measures provide useful information to investors. You can find a reconciliation in our release. All references to EPS refer to diluted EPS. So Thierry Bernard, our Chief Executive Officer; and Roland Sackers, our Chief Financial Officer, will start with some remarks on the key initiatives for the quarter, followed by a Q&A session. With that, let me hand over the call to Thierry.

Thank you, John. Hello, and good morning, good afternoon or even good evening depending on when you are in the world, and thank you for joining us. I'm very pleased to share that our teams have once again exceeded our targets and delivered another solid quarter of results. Thanks to our heavily recurring revenues, which represent over 85% of our sales, we are very well on track to achieve our goals for 2024 in this still challenging macro environment. I want here to recognize the impact of our outstanding QIAGENers. But before we get into the performance of quarter three, let me take a moment to celebrate some truly remarkable achievements. 2024 is another year where our QIAGEN customers were awarded Nobel prizes for their invaluable contribution to advancing science and improving healthcare. This is a real testament to the impact of our customers on our daily lives. As we celebrate our 40th anniversary in 2024, we are more committed than ever to delivering the highest quality product that will support future noble price winners in helping to make improvements in life possible. So now let me highlight our key messages for Q3. First and foremost, we exceeded our outlook for sales and adjusted earnings in the third quarter. We delivered $502 million of sales in the third quarter, representing 6% growth at constant exchange rate. This exceeded the outlook for at least $495 million at CER. Growth excluding the NeuMoDx franchise was also 6% CER. To be noted, we saw a 10% growth in our Diagnostic Solutions product group. Consumables and related revenues grew 8% CER over Q3 of 2023 and contributed 89% to our sales. We continue to see cautious customer spending on instruments and those sales declined 9% CER. Adjusted diluted EPS were $0.57 and results at…

Thank you, Thierry. Hello, everyone. Thank you as well from me for joining our call. We are pleased to report strong financial results for the third quarter. Let me give you four key figures to highlight that performance: a 3 percentage point improvement in adjusted operating income margin to 29.6%; an 18% increase in adjusted operating income; an 11% rise in adjusted net income compared to the same period last year; and a 73% increase in free cash flow for the first nine months of '24 to USD 364 million. Looking ahead, we are confident in our ability to achieve our full year targets. We have reaffirmed our outlook for net sales of at least $1.985 billion at CER and we increased the adjusted EPS target to at least $2.19 at CER. This is up $0.09 from the outlook we gave in January. Let me now give you some additional insights into our results and sales trends from the quarter. In terms of sales, we saw higher sales in the sample technologies diagnostic solutions and PCR product group over the third quarter of '23, while sales in genomics NGS group were unchanged. In sample technologies, we saw 1% CER growth over the year ago quarter, driven by demand for consumables, in particular, kits used on our instruments and automation systems. This growth trend is coming from the launch of upgraded systems, in particular, QIAcube Connect and EZ2 Connect. We are preparing for important new system launches in '25 and '26 and we expect this to drive further growth. In Diagnostic Solutions, sales rose 10% CER and were led by the strong growth in the QuantiFERON TB test, which marked the sixth consecutive quarter of sales above $100 million. QIAstat-Dx grew at a dynamic 40% CER pace, thanks to significant double…

Thanks a lot, Roland. And now let me take a moment to discuss with all of you more progress our teams have made across our portfolio. First on sample technology and Roland alluded to it. We are expanding our portfolio of state-of-the-art applications in many areas and this includes liquid biopsy. QIAGEN is a top provider of liquid biopsy sample prep solutions and we are the only provider of all three key technologies: circulating tumor DNA, cell free DNA and exosomes. Our portfolio has been invaluable for many years to customers. At the start to those in research studying various type of cancer and other diseases and increasingly today to commercial labs across the world offering liquid biopsy test. Those labs are many of the major names that you would recognize as the leaders in this field. We continue to solidify our leadership in this area by expanding our portfolio for urine samples and moving beyond the initial focus on blood samples. In our PreAnalytiX joint venture with Becton, Dickinson, we recently launched the PAXgene Urine Liquid Biopsy sets. This new kit addresses critical needs on how to collect, process and store DNA from urine samples for analysis. Key applications in both research and clinical health care include detection of markers for minimal residual disease analysis to monitor treatment response and even to identify therapeutic targets. We continue to innovate in this area to help advance the use of liquid biopsy, in particular, to improve precision medicine and make it easier to tailor and monitor treatments to get better outcomes for patients around the world. If we move now to QuantiFERON. Our test for latent TB detection continues to be a key contributor in the global fight against tuberculosis. Tuberculosis is on the rise. And once again, has overtaken COVID-19…

Thank you, Thierry. Let me now provide more perspectives on our updated outlook for '24 and also on the fourth quarter. We have reaffirmed the outlook for full year net sales of at least $1.985 billion at CER taking into consideration the solid growth in our base business and reduced sales from NeuMoDx after the decision to discontinue the system. For the fourth quarter, we have set an outlook for net sales of at least $520 million at CER, an increase of about 2% CER from $509 million in the fourth quarter of '23. This includes a headwind of about 1 percentage point from the NeuMoDx decision. So in effect, underlying 3% CER growth over the fourth quarter of '23 leaving the second half with a growth rate of 4% to 5%. This confirms our expected acceleration and year-on-year growth rates for the second half of '24 compared to results in the first half of this year. On adjusted earnings per share, our updated outlook for the year is for at least $2.19 at CER and another upgrade based on the significant improvements in profitability. Remember that this compares to an outlook at the start of the year for adjusted EPS for at least $2.10 CER as we double down on our commitment to solid profitable growth. Adjusted earnings per share for the fourth quarter are expected to be at least $0.60 per share also at CER compared to $0.55 in the fourth quarter of '23, so another good improvement. As for the impact on currencies, based on recent movements, we do not expect any change from what we announced at the end of the second quarter. We are expecting adverse impact on full year net sales were about 1 percentage point and an adverse impact of about $0.02 per share on adjusted EPS results. I would like to now hand back to Thierry

Thanks a lot, Roland. We are coming to the end of our call. So let me summarize our key messages for today, and then we'll move into the Q&A session. First, we had a very solid performance for the third quarter that exceeded our outlook on net sales and also on adjusted earnings. Despite the quite challenging macro environment and cautious spending among customers on instruments, our heavily recurring revenues at over 85% of sales continues to deliver solid growth. We were especially pleased with the performance of our sample technologies, diagnostic solution and PCR product groups. We also saw the innovation power and commitment to efficiency in our teams through a steady number of new product launches with an improved adjusted operating income margin at 29.6%. It is fair to say that QIAGEN is delivering on its target on sales, is delivering on profitability, delivering on cash flow generation and on product development. This makes us confident in achieving the updated outlook for '24 and positioning our company for more solid profitable growth in '25 and the years ahead. And with that, I'd now like to hand back to John and the operator for the Q&A session.

[Operator Instructions] We'll go first to Patrick Donnelly with Citi.

Thierry, maybe on QuantiFERON, another nice double digit growth quarter here. Can you just talk about, I guess, the drivers, the sustainability of this type of growth going forward? The competitive landscape certainly seems to have quieted down from our perspective. Obviously, there's some noise over the last few quarters, but no impact clearly to your business. So maybe just talk about what you're seeing again, the growth going forward? And then I have a follow-up after that.

Yes, you have seen another double digit and also highlighting another quarter, the sixth quarter above $100 million revenues. Main driver for us remains the same. We are very coherent, we have a fantastic potential to convert skin test, it's still more than 50% of this market. It's an antiquated technology and QuantiFERON in its blood format offers value to our customers. Second, the partnership with DiaSorin gives value to customers as well. We continue to convert traditional QuantiFERON customer to DiaSorin but we also are adding QuantiFERON test to the DiaSorin installed base. It's a successful partnership. And any time we convert the customers, we can do it at a premium plan. And third, because of many years of publication, proof of our technical efficiency, medical educations, we are converting more and more countries to have latent TB testing in their guidelines against tuberculosis. I would highlight that, Patrick, as the three key drivers. We believe that it's a sustainable growth ahead of us but you have seen in our Capital Markets Day that we announced an objective of $600 million revenues for QuantiFERON by the year 2028, which gives us a projected 6% to 7% CAGR for the coming years.

And then maybe just as we're kind of turning eyes towards '25 here, I know the closing remarks there, you kind of highlighted it should be another healthy year. Can you just talk about the moving pieces, both on the revenue, and then maybe Roland can chime in on the margin piece, high level as we think about next year? I mean, any reason why you guys wouldn't be kind of in that high end of the mid single digit type range next year on the revenues? Any headwinds we should be aware of, and then the same question on the margins for Roland?

And starting with the top line and then Roland on the margin expansion. I mean if you look at the paradigm of our growth pattern in '24, Patrick, you see that acceleration and we forecasted it, we disclosed that the acceleration in H2. If you look at the overall H2, we're going to be between 4% to 5% growth. We have momentum in some portfolios. QIAstat, as we highlighted, QuantiFERON, sample tech is back on growth. And we have, as Roland said, new instruments coming up in '25 and then in '26. Digital PCR, we have very differentiated solutions and consumables are growing very well. We had, had in the last three years, the fastest growth of installed base in digital PCR. Roland said that our QDR bioinformatics business was going to a transition but the fundamental of the business are very solid. More NGS testing, more oncology testing are calling for more bioinformatic analysis. So I'm trying to express that that the growth pillars of QIAGEN are leveraging good market opportunities, differentiations and features our menu expansion. With that in mind, I believe that with the performance of 4% to 5% growth in H2, we are well on track to continue on a very decent growth for '25 and to achieve our 7% CAGR '24 to '28 as said in New York in June 2024. Roland for the margin expansion?

No, I just can continue what Thierry just said. While I do think we have clearly seen so far a nice acceleration also on profitability into the second half of the year compared to the first half of the year and I clearly do believe that it's going to continue also in the fourth quarter, we will see clearly higher margins in the fourth quarter than compared to the third quarter. We are on track to what we said before to make and deliver at least 28.5% for the full year '24. But I do think it's also important to understand the composition of that because, as you know, an important change for us was the discontinuation of NeuMoDx. I do think it is very important to understand that the majority of the impact on margin improved from that is not in the numbers in '24, it will come in the -- over the course of the first half of the year. I would say, a certain amount, might be one third, which is clearly related to [Indiscernible] [IVD] impacts, which is now moving into the numbers in this year or the other topics will be rather built into the numbers or helping the numbers, if you like, for '25 because, as you know, we're still producing -- helping our customers and so on. So there's a lot of things which we still have to eat and that is going to continue most likely by mid of next year, we are done with that. In addition to that we continue what we started with now a couple of quarters ago, which is a continuous improvement [Indiscernible] efficiency program. And we clearly see that all across the company opportunities to empower organizations to get more decentralized and therefore, having quite a number of efficiency gains, which adding up and that is what is driving the margin improvement right now, but we're not stopping halfway. So I would also expect for next year a continuation of margin improvement.

We'll take our next question from Odysseas Manesiotis with Berenberg.

Firstly, could you give us a bit more color on the QIAstat placements since the GI panel launch and the mini panel launch? What share of these placements have been competitive, was there an acceleration since last quarter? And could you also share what part of these placements were placed on reagent rental contracts? And then I have a follow-up.

So first of all, the first thing I'd like to highlight is Q3 a very good number, very good performance for QIAstat placement, more than 150 placements for the quarter. It's more than our competitors. The drivers, I wouldn't say it's specifically GI approval. What is very important to remember, the US is still the first market in the world and still growing for syndromic testing. And now in the US, QIAstat can offer the minimal menu to be competitive with customers, respiratory, GI and meningitis. In addition to that, as you have seen, we are bringing a mini panel for respiratory in the US and soon we will be bringing mini panel for GI. So we create -- we strengthen the momentum. Placement versus capital sales, this is a market where you should see between or across the region, the region at 50%, 50%. 50% placement, 50% capital sales. But the key message here is that we were already growing well, thanks to Europe and some other regions without the US and QIAstat, now we are even more competitive and entering 2025 more competitive for the US. This is what makes us confident for this franchise to achieve the commitment we took to you in New York in June, which is a revenue of $200 million by 2028.

And a quick one on capital deployment. So is larger M&A still likely as you were talking about earlier in the year or is there more of a bias towards buybacks?

I mean we are extremely active on both fronts. You have seen us active on buyback at the beginning of the year. I think the main question for us is what is best for our shareholders at a given time. We have a very solid balance sheet. We have taken a commitment once again in New York of absent of significant M&A, $1 billion return to shareholders until 2028. We are still committed to achieve that. At the same time, QIAGEN is on the hunt for interesting value creation accretive M&A to reinforce our portfolio and we see M&A as an option to increase the growth potential of our portfolio.

We'll take our next question from Matt Sykes with Goldman Sachs.

Thierry, maybe one for you to start out just high level. As you think about sort of the mix of growth that you've achieved over the past year, QuantiFERON has obviously been a significant driver. And as you talked about sort of the long term normalization of that growth closer to 6 to 7. How are you thinking about the mix of the portfolio to drive incremental growth as QuantiFERON normalized a little bit? I'm assuming it's a combination of QIAstat, QIAcuity and QDI, but I would just love to hear how comfortable you are with the portfolio mix to continue to drive that incremental growth if we get that normalization in QuantiFERON?

Yes, you are perfectly right, and thanks for the question. And I would refer you to what we presented in New York in June. We continue to believe in focusing and focusing in growth opportunities where we believe we can either reinforce leadership or take substantial market shares, reinforce a leadership, it's sample tech and QuantiFERON, take meaningful market share. It is digital PCR, QIAstat syndromic testing and QIAGEN Digital Insight, our bioinformatics portfolio. And we gave you very precise data back in June. Sample tech, we believe we can achieve above market growth, 2% to 3% CAGR in the coming years because our strategy to invest in automation has paid off until now. Roland alluded to EZ2 success in Q3, to QIAcube Connect success in Q3. And we are going to launch three new instruments between 2025 and '26. QuantiFERON, we have explained the driver behind our expectation, conversion of skin test. And we believe that by 2025, we will have Lyme approved together with our partner in the US, it's a differentiated assay. The success of Lyme will be conditioned by the success on the US market. QIAstat, and we said we gave a target of 6% to 7% to achieve $600 million for QuantiFERON by 2028. Then we said we believe we have a very leadership solution for digital PCR, strong growth in installed base, movement from life science to clinical diagnostic. We are going to invest in more R&D, in more people on the field. We gave a target of $250 million by 2028. It's a significant double digit growth, but the market is growing. The power of digital PCR versus QPCR or NGS is becoming more and more recognized. QIAstat, as I just said, we have a very precise plan for menu expansion. If you remember, direct identification of positive blood culture next year. Complicated UTI, a very differentiated assays because none of the competitors has it in their portfolio or their plan and pneumonia. In addition to that, our high throughput system, QIAstat Rise will be approved in the US. That justify our confidence to grow double digit and achieve $200 million by 2028, which proves what we said for the last three years, we will be a very solid number two in syndromic testing. QDI, Roland explain that we are transitioning our business, we follow the needs of our customers towards a more SaaS business that doesn't change the interest of the market. So investing for a double digit growth on QDI and reaching $200 million by 2028 is still what we consider a realistic ambitions, of course, but realistic objective. Those will be the mix of our growth. That doesn't mean that other parts of our portfolio will not grow. We are still very confident in our positioning in next generation sequencing chemistry. We are still very confident in our positioning in forensic activities. And this is how we see the coming four years and starting with '25

And then, Roland, just on -- given your operating margin performance so far this year, I realize you laid out the guide in June of greater than 31% by 2028. And probably too early to revisit that but I just want to understand sort of the progress you've made probably above your expectations. How are you thinking about that 2028 operating margin target from here off of this base as we end '24?

No, it's a very fair question. And I would agree with what you just said that we clearly made good progression. And I do think and I shared it before that I also see and we at QIAGEN see that we have a high confidence that the same is going to happen also in '25. So I wouldn't be surprised that at some point in time, we have to revisit that target in a positive way. But as you said, also, it's way too early.

We'll take our next question from Doug Schenkel with Wolfe Research.

So your stock has been stuck in a range for years. You've been underperforming the group and the market for a while. You're clearly not being rewarded for increasingly solid execution. This was a good quarter and it's not the first one this year. So with that in mind and keeping in mind the stock trades a material discount to probably anything I can plausibly see you acquiring. I know you said you're going to return $1 billion to shareholders by 2028. We're aware of what you said at the Capital Markets Day and again, what you're saying today. I guess my question is like why not get going now? Like what are you waiting for? If you believe in your LRP, if you remain confident that competitive concerns are really just noise and it sure seems like you do. Why not bet on yourself and get more aggressive with the buyback as quickly as possible at this valuation?

Doug, it's an interesting question, and we can take it both, Roland and I. We never said that we wouldn't. We clearly signaled in New York that another one could come quite quickly, '25. Once again, it's always a question of the right moment and the best value creation. On the material discount and your first comment, I would just say, obviously, we look at the share price. I remain convinced that continuing to be extremely humble and executing quarter-after-quarter will pay off, demonstrating that the value of our portfolio is solid. So it's about execution and delivering not only on the top line but also on the operational efficiency, and then it will pay off. That's how I could address your question. But Roland, you might want to add something here.

Again, I would say we are very consistent with our share buyback policy since 2012 where we started. And as you know, typically, we started with $100 million incremental per year,we just more or less in the last two years stepped it up now to $300 million incrementals, and you know that we have another $300 million incremental approved. So I would say there's opportunities for us and I would say it's also fair what you said, given also our cash flow, we have clearly opportunity over time to step that up. So it's a fair question. And if we continue that way, it's an opportunity.

And then building of a math question about OpEx. You -- I won't roll through every variable in the equation. But it was a good margin quarter. You got NeuMoDx rolling off, which will be really margin accretive. You've talked a lot about the levers pursuant to process optimization. And then some of this is just, we're not going to be back to normal next year, but we're going to be a lot closer to normal than we've been for a while. Recognizing you don't want to revisit the multiyear targets, but just thinking about those levers and just kind of the math and how lean things have got relatively speaking, over the last couple of years from an OpEx standpoint. Is there anything I'm missing as I kind of walk through this as we think about the margin trajectory into next year and the prospects for maybe outsized incrementals?

I think we can take once again this one. But both of us, I think Roland alluded to that in the previous answer. I think we have probably some opportunities for improvement compared to the targets we gave back in June. At the same time, I would also highlight that we have already a very strong P&L if you compare to competition. We have proven you that when we speak about [indiscernible] operational efficiency, not only we mean it but we deliver on that, you start to see that. Not just about decisions like NeuMoDx, it's better site utilization and rationalization of our site network. You have seen the decision that we took on moving the San Diego for Verogen to German town -- or Frederick, very close to German town. It’s significant effort and pressure on cost of goods you have seen the tremendous evolution of QIAstat cost of goods and therefore, contribution to margin improvement in Q3, it's tremendous efforts on quality of purchasing and procurement, it's end-to-end processes, the fundamental investment that we did in updated ERP with SAP HANA will payoff, it's probably a better investment than many companies in digital activities. So yes, we have opportunities but let's deliver first on the numbers we gave and then we'll see. But Roland, you might have some other color there as well.

Yes, I think a different perspective, Doug, is also that we see, of course, certain things going much faster than we thought. We clearly, as you have seen, got now four approvals on QIAstat in more or less a couple of weeks, which I think is great news, which also, again, helps us to revisit some of our R&D pipeline projects and we might accelerate certain things, because it's clearly some topics which are going quite well right now. So I would say it's also -- well, again, as I said, we will see nice margin improvement in the fourth quarter next year for sure. And so 31% going back to the question we heard from Matt before is probably something that, as I said, needs at some point in time, certain revisit. We have also great R&D ideas and we might accelerate some of them if we have the capacity and seeing and confirming the return rates on that. So trying here also keeping the balance on is an important topic for us as well.

We'll take our next question from Aisyah Noor with Morgan Stanley.

My first one is on the QDI business where you called out a low single digit decline. What portion of your sales is subscription versus licensing today and was the shift to subscription already happening before but accelerated in the quarter? And how does this shape your view around the growth ambitions for QDI versus what you communicated at the Capital Markets Day, I think 15% growth in 2028?

It has not happened just overnight. It's a trend, we listen to our customers, especially our pharma customers, the biggest customers, and this is the evolution they want. It doesn't change the volume of the contract. It changed the way we recognize the revenues over time. The interest for our solutions has not decreased. If you look at the performance of QDI clinical, it was very much growing. It's a bit softer in research and academia but because research and academia is a bit softer those days, it will pick up at a point as well. So long story short, we are accompanying our customers in their also model evolution, listening to them. It's the good thing to do, I think. It's not changing the nature of the volume of our contract or the interest in our portfolio. And therefore, our ambitions to achieve $200 million by '28 is not changing. We are number one. But never forget, compared to competition, we are profitable, number one. It's accretive also to our P&L. And this is something also that we need to highlight. It's a profitable business for QIAGEN. It's not the case in the rest of the market.

And then my second one was on QuantiFERON. So keen to get your updated thoughts on signing a secondary distribution partner. Just what would be the biggest hurdles to signing on a new partner, is it the right instrument, the right licensing terms? Because partnerships are not foreign to you, you've got partnerships with Astra, Lilly, McKesson. It's not like you've not done this before. If you could talk through your considerations there, that would be great.

As we have said many times, we are remaining open to different options. The first thing that we want to highlight and it is important is that the partnership with DiaSorin works well and has proven to be efficient. By contract, we now have the right to add one new partner per geographic region where we are together operating with DiaSorin. We review options, installed base would be a criteria, real willingness of a would be partner to invest. We need to show also commitment of that would be partner to invest into the business in market creation, in demand creation. So basically, we are in the best of many worlds at the moment at QIAGEN. On one hand, we have a very successful partnership. On the other hand, we have options to take potentially other partnerships. We'll see, time will tell.

We'll take our next question from Michael Ryskin with Bank of America.

I want to follow up on sample prep, which I think has just touched on a little bit. Just you talked about market growth, you've talked about CAGR relative to that for the out years. But just the performance this year, I just want to dig into that a little bit more. It's still an important part of the business and you're outperforming in diagnostics clearly. But just anything more you can call on that in terms of confidence in reaccelerating maybe some of the one timers that are impacting that this year, whether that's on instruments or broader market demand? Just help us bridge that back to low single digits.

Well, as you know, Michael -- thanks for the question. You know that we have significant market shares in this segment of the market, both manual and automated, but we have taken a clear strategy for the last four years to bet on automation. And betting on automation for us means either upgrading our current installed base with new features or launching new instruments. In the last two years, two years, two years and a half, what you have seen is upgrade of current installed base. QIAcube became QIAcube Connect. EZ1 became EZ2. What you are going to see now in the coming two years is a mix of both. We are going to upgrade QIAsymphony. I remind you that QIAsymphony is still the flagship instrument for thousands of laboratories all over the world. And this instrument will become QIAsymphony Connect with new features launched in plan at the end of 2025. We said in New York that we would enter a new segment of high throughput sample tech. We disclosed the solution in New York. And what we will also add to that plan is the launch of a new system where we are going to give you more details probably by JP Morgan, which is a much more smaller throughput benchtop system. So we have three automation coming on. And if you look at our results for the last two quarters, we are back on growth. Yes, it's 1% growth. But it's growth based on significantly already existing market shares. So we don't see why we could not continue that momentum and even accelerating it slightly, because we are going to offer new solutions either in volume, our high throughput system or easy automation of low throughput customers with the new system that we will present at JP Morgan. So this is giving us the confidence to be probably yes, around 3% CAGR for the coming years, which will be above market growth, which will strengthen our market leadership and then delivering on what we gave you and the numbers we gave you in New York.

And then maybe just a modeling tie-up on NeuMoDx. I think you've been very consistent in sort of like the wind down and the timing of that. But just as we look ahead to 2025, I mean, any way to size just how much contribution there will still be to the model next year? I realize that you're winding it down. We're expecting about a 1% headwind from NeuMoDx year-over-year. Is that about right or could it be a little bit less, a little bit more than that?

Yes, thank you for highlighting that we are executing well here. Again, we are not on the call for '25. But the way I invite you to see it is that we will still have some revenues in Q1 and Q2. Our sites for NeuMoDx in Ann Arbor will be definitely shut down at the end of Q2. And therefore, the way you should see it probably is no revenues anymore on NeuMoDx in H2 of 2025.

We'll take our next question from Casey Woodring with JP Morgan.

One quick one maybe for Roland. So instrument revenue was down year-on-year but was flat sequentially. Curious what you're embedding for instrument growth sequentially in 4Q, if you're taking in any sort of seasonal step-up or assuming kind of continued stabilization there? And then I have one follow-up.

We actually do believe that the fourth quarter, in general, will be slightly better sequentially in terms of instrumentation growth. Again, that is clearly one factor, particularly if you also have in mind but clearly, there is a headwind also here on the -- from NeuMoDx. So we see that, particularly -- again, QIAstat, QIAcuity and some others are going to help being helpful on the instrumentation side. Nevertheless, overall, it will stay negative but better than the quarter before.

And Thierry, maybe one for you. You talked a little bit about your capabilities in liquid biopsy and have launched a number of new solutions there recently. Just curious how you're thinking about that application driving consumables growth here over time? And if there's really any way to quantify the liquid biopsy growth contribution here moving forward?

So the way I invite you to see QIAGEN in liquid biopsy is one that of a pioneer. Our penetration of the liquid biopsy market is not just 2024. And again, as I said today, we are the only company fully mastering the three key technologies necessary to perform good liquid biopsies, ccfDNA, CTCs, exosome. And second, we are an enabler. It's using liquid biopsy based solution by QIAGEN that big names on the market, the Guardant Health, the Natera and many others in the world can perform their solution. And being an enabler is a very smart positioning because more and more companies investing in liquid biopsy have to use your solutions, but you are not necessarily exposed to downsize like change of coverage in reimbursement, so on and so forth. And this is where we want to insist in our position, being a top enabler of liquid biopsy solution providers, mainly in oncology application but beyond oncology. You will see also, as we said in New York, our portfolio in sample tech, will invest beyond instrumentation also in much more added value consumable sample tech and mostly around liquid biopsy, because this is where we have value and we can also generate quite high pricing as well. So that's the positioning that we want to take that we are already leveraging from but that we want to strengthen.

We'll take our last question from Andrew Brackmann with William Blair.

Maybe just following the US election earlier this week, a key topic here has been just sort of tariffs broadly. So recognizing that QIAGEN is a sort of very global business. Can you maybe just sort of level set us on how you're thinking about any exposure there? And then I guess bigger picture any impact to the way you're sort of thinking about running the business in light of some of these potentially broad policy directions that we've been hearing about?

And we can also take this question, the two of us, obviously. The first thing I would say is that, as you said, we are a global company and one of the strengths in the company that our geographic presence is extremely balanced between the US but also Europe, emerging countries. So that's a strength. Second, we believe that it's very fast too early to take some statements. Obviously, we listen to the candidates platform and we built our model accordingly. We'll see what happens. It's a bit premature. What is very clear as far as the US is concerned, first of all, it is still and by far the main market for healthcare and for healthcare innovation in the world. Being in the US present commercially but also with R&D and manufacturing is extremely important and there is no way we are going to change that. For the rest, we need to see and to look for the coming months and constantly adjust our policies and actions according to a decision that might be made but that's what I would say at this stage. Roland, would you like to add some color to that?

Along the lines, Andrew, I do think it's very straightforward and we’ve said, there's no details to leave and that clearly takes some time before that is going to happen. But nevertheless, some of the facts are clearly in the programs, which were announced ahead of the elections. And the ones which are probably more concrete on the corporate tax side and it's quite obvious as Thierry said, we're having around 50% of revenues in the US with also having a significant local sites in a couple of places in the US. There's clearly also a corporate tax liability for QIAGEN. So we have to see what that means. There's also a bigger question now what happens to the whole Pillar 2 developments globally, because I'm quite sure that with President Trump that agenda is going to change as well. And as you know, we were rather expecting rising corporate tax rate in the midterm plan as well. So again, there's no final answer on that but I do think there becomes more questions. Tariffs, as we all know, always go in two directions. There's never just one side adding tax another site and nobody is reacting to that. Therefore, I would say if that is going to happen that is something that is affecting companies globally in any direction there you have to wait for the details.

With that, I'd like to end the call and express our appreciation to all of you for your participation. And please do not hesitate to reach out to Dominica and me with any questions or comments, topics that you want to address. Thank you very much. Bye-bye.

Thank you. Ladies and gentlemen, this concludes the conference call. Thank you for joining, and have a pleasant day. Goodbye.