Full Press Release Details
Highlights
DUBLIN--(BUSINESS WIRE)--ICON plc (NASDAQ: ICLR), a world-leading clinical research organization, today reported its financial results for the fourth quarter and full year 2025, and announced the outcome of its investigation by the Audit Committee of the Board of Directors into certain accounting practices.
CEO, Mr. Barry Balfe commented,“ICON demonstrated continued commercial momentum through the fourth quarter, underpinned by disciplined execution against our strategic priorities. We achieved notably strong net bookings, with gross awards strengthening, cancellations normalizing and forward-looking indicators encouraging. Our competitive position remains very strong, with established partnerships continuing to deliver, while newer relationships are maturing and increasingly contributing to results. Importantly, the demand environment is also improving, supported by strengthening biotech funding and sustained large pharma investment.
I am also pleased that we have concluded the investigation into certain accounting practices. We identified the issues, rigorously investigated them and are actively building a stronger control environment. This will remain a priority for me, for our Board and for the broader leadership team.
Looking ahead, ICON retains a positional advantage in the drug development industry. Our leading scale, capabilities and customer base are augmented by our strategic investments in differentiated agentic technologies. While near-term financial performance will reflect the headwinds identified in 2025, increasing commercial momentum and a maturing portfolio of strategic partnerships point to sustainable growth into 2027 and beyond."
Fourth Quarter 2025Results
In quarter four 2025, gross bookings were $3,233 million with cancellations of $365 million. This resulted in net business wins of $2,868 million and a book to bill of 1.36.
Revenue for the fourth quarter was $2,112.5 million. This represents an increase of 2.5% on prior year revenue or 1.1% on a constant currency basis.
GAAP net income was $149.2 million, resulting in diluted earnings per share of $1.93 in quarter four 2025, compared to diluted earnings per share of $3.58 in quarter four 2024, a decrease of 46.1% year over year. Adjusted net income for the quarter was $195.1 million, resulting in adjusted diluted earnings per share of $2.52 compared to $3.86 per share for the fourth quarter 2024.
Adjusted EBITDA for the fourth quarter was $327.1 million or 15.5% of revenue.
The effective tax rate on adjusted net income in quarter four 2025 was 19.0%.
Cash generated from operating activities for the quarter was $234.2 million. During the quarter, $59.3 million was spent on capital expenditure. Additionally, $7.4 million of Term Loan B payments were made during the quarter. At December 31, 2025, the Group had cash and cash equivalents of $647.3 million, compared to cash and cash equivalents of $468.9 million at September 30, 2025 and $538.8 million at December 31, 2024. Net indebtedness as at December 31, 2025 was $2.8 billion.
Backlog Reporting Enhancements
The Company has decided to adjust how it calculates and presents cancellations and its backlog. The changes implemented are intended to provide enhanced visibility into reported metrics that are relevant to assess current and future performance of the business.
Effective October 1, 2025, ICON modified its cancellations policy, such that reported quarterly cancellation amounts now reflect in-period cancellation notifications from customers, in addition to studies that have been inactive, or identified by management as at-risk for cancellation. There is no change to ICON's treatment of awards and their recognition into backlog.
These policy changes resulted in an adjustment to reported backlog of $3.9 billion, resulting in an updated backlog value of $21.1 billion, as of October 1, 2025.
Full Year 2025 Results and 2026 Guidance
Gross business wins were $11,867 million and cancellations were $2,834 million, as determined under the new policy. This resulted in net business wins of $9,033 million and a book to bill of 1.09. As of December 31, 2025, under the new methodology, total backlog was $21.8 billion.
Full year revenue was $8,251.3 million. This represents a year on year increase of 0.8% or 0.1% on a constant currency basis.
GAAP net income was $229.3 million, resulting in $2.90 diluted earnings per share compared to $8.90 per share for the equivalent prior year period, representing a decrease of 67.4%. Adjusted net income was $989.8 million, resulting in an adjusted diluted earnings per share of $12.53 compared to $13.37 per share for the equivalent prior year period. This represents a decrease of 6.3%.
Adjusted EBITDA was $1,530.7 million or 18.6% of revenue, a year on year decrease of 8.4%.
The effective tax rate on adjusted net income in 2025 was 16.9%.
Cash generated from operating activities in 2025 was $1,036.2 million. $174.2 million was spent on capital expenditure. $750.0 million worth of stock was repurchased at an average price of $167 per share. Additionally, $29.8 million of Term Loan B payments were made.
The Company is issuing full-year financial guidance for 2026 with revenue expected in the range of $7,850 - $8,150 million, and adjusted diluted earnings per share expected in the range of $10.00 - $11.00.
Conclusion of Investigation and Restatement of Financial Statements
The Audit Committee of the Board of Directors has completed its previously announced investigation into certain accounting practices and controls, initiated following concerns reported through Company management.
The investigation primarily focused on revenue recognition practices and concluded that improper adjustments were made to the clinical trial services revenue of the Company from the third quarter of 2023 to the fourth quarter of 2024, which impacted the timing of revenue recognition. The Company also identified errors in determining the estimated cost to complete, the assessment of realizable value, and certain manual adjustments in respect of clinical trial services revenue contracts during 2023, 2024 and 2025. The Company also identified issues with the presentation of unbilled and unearned revenue, where contract assets and liabilities eligible for offset were not fully identified.
As described in the Form 20-F, the Company has concluded that revenue was overstated by $65.3 million for the year ended December 31, 2023 (0.8% total revenue) and by $92.7 million for the year ended December 31, 2024 (1.1% of total revenue). As part of the investigation, ICON identified material weaknesses in its internal control over financial reporting. The Company’s entity level controls, including the tone from management, were insufficient to enforce the monitoring and maintenance of a proper environment for effective internal control over financial reporting. Management did not design and operate effective internal controls to prevent material errors to revenue and related accounts.
The Company’s current management, under the oversight of the Audit Committee, is committed to remediating the material weaknesses identified above, fostering continuous improvement in internal controls and enhancing its overall internal control environment. The Company’s remediation plan includes enhancements in relation to four key areas: oversight of control environment, policies and procedures, training and internal controls over manual adjustments.
The 2025 Annual Report on Form 20-F contains additional details regarding the material weaknesses and actions the Company have taken and continue to take to remediate the identified material weaknesses.
Board of Directors Update
The Company also announced that Mr. Kevin Egan and Mr. Jeff Elliott will join ICON's Board of Directors, effective June 1, 2026 and that Dr. Steve Cutler resigned from the Board effective May 21, 2026.
Mr. Kevin Egan brings a wealth of experience, notably in auditing, after completing a 37-year career in public auditing, including leading PwC Ireland's audit and assurance practice from 2007 - 2015. He also currently serves as non-executive director and Chair of the Audit Committee at Perrigo plc.
Mr. Jeff Elliott also brings a significant amount of expertise and financial depth, from previous leadership and operational roles. He was Chief Financial Officer of Exact Sciences Corp. from 2016 to 2024, and also served as Chief Operating Officer from 2021 to 2023. Prior to his roles at Exact Sciences, Jeff was a senior equity research analyst covering healthcare companies at Robert W. Baird & Co. Additionally, Jeff currently serves as non-executive director on the Boards of Quanterix, Inc. and Sera Prognostics.
Mr. Ciaran Murray, Chairman of the Board, commented,"The Board of ICON is committed to the highest standards of corporate governance and is satisfied that the investigation into certain accounting practices conducted by the Audit Committee on the Board's behalf is complete. A remediation plan to address control weaknesses has been developed by Management and its implementation will be subject to oversight by the Audit Committee. I am also pleased to announce the appointment of Mr. Kevin Egan and Mr. Jeff Elliott to the Board effective June 1, 2026. Their extensive knowledge and expertise across financial-related matters, as well as experience in the healthcare industry, will serve to further strengthen the Board's support of ICON's long-term strategy and growth ambition."
Conference Call Details
ICON will hold a conference call on May 28, 2026 at 08:00 EDT [13:00 Ireland & UK]. This call and linked slide presentation can be accessed live from our website athttp://investor.iconplc.com. A recording will also be available on the website for 90 days following the call. In addition, a calendar of company events, including upcoming conference presentations, is available on our website, under “Investors”. This calendar will be updated regularly.
Other Information
Cautionary Statement Regarding Forward-Looking Statements
Certain statements contained herein are forward-looking statements. All statements other than statements of historical fact are forward-looking. Examples of forward-looking statements include, but are not limited to, statements regarding the following: anticipated financial results for 2026; the remediation of material weaknesses in the Company's internal control over financial reporting and the implementation of the Company's corrective action plan; the Company's expectations regarding business momentum, demand trends, commercial performance and competitive position; and the Company's expectations with respect to its long-term value creation and growth. You can identify many forward-looking statements by words such as “aims,” “anticipates,” “believes,” “continues,” “could,” “estimates,” “expects,” “focused,” “guidance,” “intends,” “look,” “may,” “opportunities,” “plans,” “position,” “potential,” “predicts,” “projects,” “seeks,” “should,” “will,” “would” and other similar expressions and the negatives of such expressions. However, not all forward-looking statements contain these words. These statements are based on management's current expectations and information currently available, including current economic and industry conditions. Actual results may differ materially from those stated or implied by forward-looking statements due to risks and uncertainties associated with the Company's business, and forward-looking statements are not guarantees of future performance. Such risks and uncertainties include, but are not limited to: dependence on the pharmaceutical industry and certain clients; the need to regularly win projects and then to execute them efficiently and correctly; the challenges presented by rapid growth; competition and the continuing consolidation of the industry; the impact of market conditions on demand for the Company's services; risks related to the Company’s ability to execute on its commercial strategy and maintain relationships with large pharmaceutical customers; risks relating to the Company's strategic partnerships; the dependence on certain key executives; changes in the regulatory environment; exchange rate fluctuations; inflation and rising labor costs; the risk that material weaknesses in the Company's internal control over financial reporting are not remediated on the timeline expected or at all; the risk that the remediation measures and the corrective action plan do not adequately address the identified material weaknesses; and other factors, including those factors described in the section entitled “Risk Factors” of our Annual Report on Form 20-F most recently filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made and we do not undertake any obligation to update publicly any forward-looking statement, either as a result of new information, future events or otherwise, except to the extent required by law.
Non-GAAP Financial Measures
In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), this press release contains certain non-GAAP financial measures, including adjusted EBITDA, adjusted net income and adjusted diluted earnings per share and free cash flow. Adjusted EBITDA excludes stock-based compensation, foreign currency gains and losses, restructuring, transaction, integration-related and other adjustments, fair value movement on investments in equity, and goodwill impairment, impairment of non-financial assets. Adjusted net income and adjusted diluted earnings per share exclude amortization, stock-based compensation, foreign currency gains and losses, restructuring, transaction, integration-related and other adjustments, transaction-related financing costs, fair value movement on investments in equity, goodwill impairment, impairment of non-financial assets and their related taxation effect. Free cash flow reflects cash generated from operating activities less capital expenditure. While non-GAAP financial measures are not superior to or a substitute for the comparable GAAP measures, ICON believes certain non-GAAP information is useful to investors for historical comparison purposes.
*Our full-year 2026 guidance adjusted diluted earnings per share measures are provided on a non-GAAP basis without a reconciliation to the most directly comparable GAAP measure because the Company is unable to predict with a reasonable degree of certainty certain items contained in the measures without unreasonable efforts. For the same reasons, the Company is unable to address the probable significance of the unavailable information.
ICON plc is a world-leading clinical research organization. Offering deep operational and medical expertise we accelerate innovation, driving emerging therapies forward to improve patient outcomes. From molecule to medicine, we deliver integrated consulting, clinical development, commercialization and post-marketing solutions to pharmaceutical, biotechnology, medical device, government and public health organizations worldwide. With headquarters in Dublin, Ireland, ICON employed approximately 40,100 employees in 97 locations in 55 countries as at December 31, 2025. For further information about ICON, visit:www.iconplc.com.
ICON/ICLR-F
| ICON plcCONSOLIDATED STATEMENTS OF OPERATIONSFOR THE THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2025 AND DECEMBER 31, 2024 AND DECEMBER 31, 2023(UNAUDITED) | |||||||||||||||||||||||
| Three Months Ended December 31 | Year ended December 31, | ||||||||||||||||||||||
| 2025 | 2024(AsRestated) | 2023(AsRestated) | 2025 | 2024(AsRestated) | 2023(AsRestated) | ||||||||||||||||||
| (in thousands, except share and per share data) | |||||||||||||||||||||||
| Revenue | $ | 2,112,517 | $ | 2,061,867 | $ | 2,040,603 | $ | 8,251,340 | $ | 8,188,990 | $ | 8,054,926 | |||||||||||
| Costs and expenses: | |||||||||||||||||||||||
| Direct costs | 1,631,779 | 1,429,127 | 1,442,117 | 6,075,746 | 5,818,061 | 5,706,187 | |||||||||||||||||
| Selling, general and administrative | 179,700 | 151,445 | 195,560 | 780,139 | 728,348 | 768,559 | |||||||||||||||||
| Depreciation and amortization | 90,290 | 96,655 | 149,733 | 382,996 | 488,500 | 585,950 | |||||||||||||||||
| Transaction and integration related | 6,128 | 7,907 | 9,660 | 25,269 | 29,574 | 44,176 | |||||||||||||||||
| Restructuring | (3,227 | ) | 46,334 | — | 79,069 | 92,123 | 45,390 | ||||||||||||||||
| Goodwill impairment | — | — | — | 364,248 | — | — | |||||||||||||||||
| Impairment of non-financial assets | — | — | — | 101,027 | — | — | |||||||||||||||||
| Total costs and expenses | 1,904,670 | 1,731,468 | 1,797,070 | 7,808,494 | 7,156,606 | 7,150,262 | |||||||||||||||||
| Income from operations | 207,847 | 330,399 | 243,533 | 442,846 | 1,032,384 | 904,664 | |||||||||||||||||
| Interest income | 1,492 | 3,008 | 1,720 | 7,109 | 8,609 | 5,014 | |||||||||||||||||
| Interest expense | (49,487 | ) | (51,429 | ) | (81,034 | ) | (197,490 | ) | (237,237 | ) | (336,699 | ) | |||||||||||
| Income before income tax (expense) / benefit | 159,852 | 281,978 | 164,219 | 252,465 | 803,756 | 572,979 | |||||||||||||||||
| Income tax (expense) / benefit | (10,658 | ) | 12,767 | 19,166 | (23,126 | ) | (64,630 | ) | (18,388 | ) | |||||||||||||
| Income before share of earnings from equity method investments | 149,194 | 294,745 | 183,385 | 229,339 | 739,126 | 554,591 | |||||||||||||||||
| Share of equity method investments | — | — | — | — | — | (383 | ) | ||||||||||||||||
| Net income | $ | 149,194 | $ | 294,745 | $ | 183,385 | $ | 229,339 | $ | 739,126 | $ | 554,208 | |||||||||||
| Net income per ordinary share: | |||||||||||||||||||||||
| Basic | $ | 1.95 | $ | 3.60 | $ | 2.23 | $ | 2.92 | $ | 8.96 | $ | 6.75 | |||||||||||
| Diluted | $ | 1.93 | $ | 3.58 | $ | 2.21 | $ | 2.90 | $ | 8.90 | $ | 6.70 | |||||||||||
| Weighted average number of ordinary shares outstanding: | |||||||||||||||||||||||
| Basic | 76,522,983 | 81,785,620 | 82,399,478 | 78,423,675 | 82,482,764 | 82,101,813 | |||||||||||||||||
| Diluted | 77,307,279 | 82,236,018 | 83,112,757 | 78,965,385 | 83,032,424 | 82,717,640 |
| ICON plcCONSOLIDATED BALANCE SHEETSAS AT DECEMBER 31, 2025 AND DECEMBER 31, 2024 AND DECEMBER 31, 2023(UNAUDITED) | |||||||||||
| December 31,2025 | December 31,2024(As Restated) | December 31,2023(As Restated) | |||||||||
| ASSETS | (in thousands) | ||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 647,295 | $ | 538,785 | $ | 378,102 | |||||
| Available for sale investments | — | — | 1,954 | ||||||||
| Accounts receivable, net of allowance for credit losses | 1,474,898 | 1,392,764 | 1,764,404 | ||||||||
| Unbilled revenue | 1,096,592 | 1,040,174 | 853,581 | ||||||||
| Other receivables | 116,750 | 79,487 | 65,797 | ||||||||
| Prepayments and other current assets | 105,316 | 140,435 | 132,105 | ||||||||
| Income taxes receivable | 60,824 | 83,523 | 91,254 | ||||||||
| Total current assets | $ | 3,501,675 | $ | 3,275,168 | $ | 3,287,197 | |||||
| Non-current assets: | |||||||||||
| Property, plant and equipment, net | 395,724 | 382,879 | 361,184 | ||||||||
| Goodwill | 8,731,689 | 9,051,410 | 9,022,075 | ||||||||
| Intangible assets, net | 3,247,118 | 3,559,792 | 3,855,865 | ||||||||
| Operating right-of-use assets | 128,948 | 147,602 | 140,333 | ||||||||
| Other receivables | 75,707 | 72,796 | 78,470 | ||||||||
| Income taxes receivable | — | 11,395 | — | ||||||||
| Deferred tax asset | 106,871 | 75,832 | 72,855 | ||||||||
| Investments in equity | 82,050 | 57,948 | 46,804 | ||||||||
| Total Assets | $ | 16,269,782 | $ | 16,634,822 | $ | 16,864,783 | |||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 192,117 | $ | 173,025 | $ | 131,584 | |||||
| Unearned revenue | 1,550,471 | 1,467,671 | 1,566,464 | ||||||||
| Other liabilities | 904,826 | 909,776 | 908,151 | ||||||||
| Income taxes payable | 18,999 | 55,258 | 13,968 | ||||||||
| Current bank credit lines, loan facilities and notes | 529,762 | 29,762 | 110,150 | ||||||||
| Total current liabilities | $ | 3,196,175 | $ | 2,635,492 | $ | 2,730,317 | |||||
| Non-current liabilities: | |||||||||||
| Non-current bank credit lines, loan facilities and notes, net | 2,872,616 | 3,396,398 | 3,665,439 | ||||||||
| Lease liabilities | 117,122 | 140,085 | 126,321 | ||||||||
| Non-current other liabilities | 72,807 | 82,718 | 45,246 | ||||||||
| Non-current income taxes payable | 103,251 | 127,544 | 187,706 | ||||||||
| Deferred tax liability | 714,427 | 811,231 | 898,308 | ||||||||
| Commitments and contingencies | — | — | — | ||||||||
| Total Liabilities | $ | 7,076,398 | $ | 7,193,468 | $ | 7,653,337 | |||||
| Shareholders' Equity: | |||||||||||
| Ordinary shares, par value 6 euro cents per share; 100,000,000 shares authorized, | |||||||||||
| 76,567,325 shares issued and outstanding at December 31, 2025, (2024: 80,756,860 and 2023: 82,495,086) | 6,305 | 6,586 | 6,699 | ||||||||
| Additional paid-in capital | 7,131,956 | 7,020,231 | 6,942,669 | ||||||||
| Other undenominated capital | 1,606 | 1,304 | 1,162 | ||||||||
| Accumulated other comprehensive loss | (68,534 | ) | (229,929 | ) | (143,506 | ) | |||||
| Retained earnings | 2,122,051 | 2,643,162 | 2,404,422 | ||||||||
| Total Shareholders' Equity | $ | 9,193,384 | $ | 9,441,354 | $ | 9,211,446 | |||||
| Total Liabilities and Shareholders' Equity | $ | 16,269,782 | $ | 16,634,822 | $ | 16,864,783 |
| ICON plcCONSOLIDATED STATEMENTS OF CASH FLOWSFOR THE TWELVE MONTHS ENDED DECEMBER 31, 2025 AND DECEMBER 31, 2024 AND DECEMBER 31, 2023(UNAUDITED) | |||||||||||
| Year ended December 31, | |||||||||||
| 2025 | 2024(As Restated) | 2023(As Restated) | |||||||||
| (in thousands) | |||||||||||
| Cash flows provided by operating activities: | |||||||||||
| Net income | $ | 229,339 | $ | 739,126 | $ | 554,208 | |||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 382,996 | 488,500 | 585,950 | ||||||||
| Goodwill impairment | 364,248 | — | — | ||||||||
| Impairment of non-financial assets | 101,027 | — | — | ||||||||
| Impairment of operating right-of-use assets and related property, plant and equipment | 3,683 | 15,731 | 8,686 | ||||||||
| Reduction in carrying value of operating right-of-use assets | 36,116 | 39,787 | 41,546 | ||||||||
| Loss on equity method investments | — | — | 383 | ||||||||
| Acquisition-related gain | — | — | (6,160 | ) | |||||||
| Amortization of financing costs and debt discount | 5,980 | 23,533 | 16,402 | ||||||||
| Stock compensation expense | 102,041 | 45,870 | 55,667 | ||||||||
| Deferred tax benefit | (128,919 | ) | (102,886 | ) | (85,388 | ) | |||||
| Unrealized foreign exchange movements | 26,464 | 6,911 | 19,706 | ||||||||
| Other non-cash items | 11,333 | 31,900 | 24,332 | ||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable | (108,213 | ) | 332,616 | (57,378 | ) | ||||||
| Unbilled revenue | (61,109 | ) | (192,176 | ) | 118,328 | ||||||
| Unearned revenue | 68,516 | (96,787 | ) | 46,523 | |||||||
| Other net assets | 2,703 | (45,473 | ) | (161,778 | ) | ||||||
| Net cash provided by operating activities | 1,036,205 | 1,286,652 | 1,161,027 | ||||||||
| Cash flows used in investing activities: | |||||||||||
| Purchase of property, plant and equipment | (174,214 | ) | (168,060 | ) | (140,692 | ) | |||||
| Purchase of subsidiary undertakings (net of cash acquired) | (2,537 | ) | (84,159 | ) | (71,766 | ) | |||||
| Movement of available for sale investments | — | — | (241 | ) | |||||||
| Proceeds from investments in equity | 9,089 | 2,690 | — | ||||||||
| Purchase of investments in equity | (19,871 | ) | (17,261 | ) | (13,954 | ) | |||||
| Net cash used in investing activities | (187,533 | ) | (266,790 | ) | (226,653 | ) | |||||
| Cash flows used in financing activities: | |||||||||||
| Debt issue costs | (750 | ) | (12,679 | ) | — | ||||||
| Drawdown of credit lines and loan facilities | 50,000 | 2,317,480 | 370,000 | ||||||||
| Repayment of credit lines and loan facilities | (79,762 | ) | (2,677,763 | ) | (1,265,000 | ) | |||||
| Proceeds from exercise of equity compensation | 9,724 | 36,187 | 50,973 | ||||||||
| Share issue costs | (19 | ) | (22 | ) | (16 | ) | |||||
| Repurchase of ordinary shares | (750,000 | ) | (499,998 | ) | — | ||||||
| Share repurchase costs | (450 | ) | (388 | ) | — | ||||||
| Net cash used in financing activities | (771,257 | ) | (837,183 | ) | (844,043 | ) | |||||
| Effect of exchange rate movements on cash | 31,095 | (21,996 | ) | (997 | ) | ||||||
| Net increase in cash and cash equivalents | 108,510 | 160,683 | 89,334 | ||||||||
| Cash and cash equivalents at beginning of period | 538,785 | 378,102 | 288,768 | ||||||||
| Cash and cash equivalents at end of period | $ | 647,295 | $ | 538,785 | $ | 378,102 | |||||
Investor Relations +1 888 381 7923Nigel Clerkin Chief Financial Officer +353 1 291 2000Kate Haven Vice President Investor Relations +1 888 381 7923All at ICONhttp://www.iconplc.com