Thermo Fisher Scientific Inc. reported a 5% decrease in revenues from 2022 to 2023, dropping from $44.9 billion to $42.9 billion. The GAAP operating income also fell by 18% from $8.4 billion to $6.9 billion. However, the adjusted operating income margin decreased by 1.6 percentage points, from 24.5% to 22.9%. The GAAP diluted earnings per share attributable to Thermo Fisher Scientific Inc. decreased by 12% from $17.63 to $15.45, while the adjusted earnings per share dropped by 7% from $23.24 to $21.55.
The company's organic revenue growth declined by 5% in 2023, primarily due to reduced demand for products and services related to COVID-19 vaccines and therapies. The decline in sales of products related to COVID-19 testing was significant, dropping from $3.11 billion in 2022 to $0.33 billion in 2023. However, the company experienced growth in its academic and government market due to accelerated investments in high-impact innovation and strong commercial execution. The industrial and applied market also saw growth driven by the relevance of the company's analytical instrument technologies serving semiconductor and materials science customers.
Thermo Fisher Scientific Inc. executed its proven growth strategy through high-impact innovation, trusted partner status with customers, and an unparalleled commercial engine. The company also made notable acquisitions in 2023, including The Binding Site Group and CorEvitas, LLC, to expand its portfolio and offerings within the Specialty Diagnostics and Laboratory Products and Biopharma Services segments.
Segment results showed varying performance. The Life Sciences Solutions segment experienced a 26% decrease in organic revenues, primarily due to moderation in COVID-19 related revenue. The Analytical Instruments segment, on the other hand, saw a 10% increase in organic revenues in 2023, driven by increased demand across all businesses within the segment. The Specialty Diagnostics segment reported an 8% decrease in organic revenues, primarily driven by reduced demand for products addressing the diagnosis of COVID-19. The Laboratory Products and Biopharma Services segment achieved a 2% increase in organic revenues, primarily due to higher sales in the clinical research and pharma services businesses.
Non-operating items such as net interest expense and other income/(expense) also experienced changes. Net interest expense increased due to higher debt for general corporate purposes and capital deployment initiatives. The company's net interest expense was reduced by approximately $116 million in 2023 as a result of its interest rate swap and cross-currency interest rate swap arrangements. The company's GAAP and adjusted tax rates in 2023 were impacted by changes in valuation allowances and tax planning initiatives.
Thermo Fisher Scientific Inc. ended 2023 with $8.1 billion in cash and cash equivalents and a total debt of $34.9 billion. Approximately half of the company's cash balances and cash flows from operations are from outside the U.S., where it uses its non-U.S. cash for needs outside of the U.S.
In conclusion, while the company faced challenges due to reduced demand for products and services related to COVID-19 vaccines and therapies, it also saw growth in other segments and executed strategic acquisitions to expand its offerings. The company's financial performance and strategic investments reflect its resilience and adaptability in a changing market landscape. As a result of these announcements, the company's shares have moved 1.4% on the market, and are now trading at a price of $560.52. For more information, read the company's full 10-K submission here.
