Executive Summary / Key Takeaways

• Diversified Strength Fuels Resilience: IQVIA's integrated model, spanning Technology & Analytics Solutions (TAS), Research & Development Solutions (R&DS), and Contract Sales & Medical Solutions (CSMS), provides a robust foundation, enabling consistent performance even amidst industry headwinds and macroeconomic uncertainty.
• AI as a Core Differentiator: The company is aggressively leveraging "Healthcare-grade AI" and strategic partnerships with NVIDIA to deploy specialized AI agents, driving significant operational efficiencies, accelerating insights, and enhancing its competitive moat in a rapidly evolving life sciences landscape.
• R&DS Momentum and Backlog Growth: Despite past reprioritizations and decision-making delays, R&DS is showing strong forward momentum with record backlog ($32.4 billion as of September 30, 2025) and improving demand indicators, signaling a return to more normalized growth trajectories.
• TAS Leads with Real-World Evidence: The TAS segment, particularly its real-world evidence (RWE) offerings, is a key growth driver, benefiting from new drug launches and increasing demand for integrated, data-driven commercialization solutions.
• Robust Financial Health and Shareholder Returns: IQVIA delivered record free cash flow in Q3 2025 and is committed to shareholder returns through an active share repurchase program, underpinned by disciplined working capital management and a strong liquidity position.

The Intelligent Ecosystem: IQVIA's Foundation in a Dynamic Healthcare Market

IQVIA Holdings Inc. stands as a global leader at the intersection of clinical research, commercial insights, and healthcare intelligence. Its core mission is to accelerate medical treatments and improve patient outcomes, a goal it pursues through its proprietary "IQVIA Connected Intelligence" platform. This platform integrates high-quality health data, advanced analytics, cutting-edge technology, and deep domain expertise to deliver actionable insights and services. The company's journey has been marked by strategic evolution, notably the 2016 merger of Quintiles and IMS Health, which combined extensive clinical research capabilities with unparalleled data and analytics prowess, leading to its current identity in 2017.

The broader life sciences industry operates within a complex and dynamic environment. Biotech funding, a critical driver for early-stage research, is showing renewed vigor, with full-year biotech funding exceeding $100 billion in 2024, a 44% increase over 2023. This momentum continued into Q3 2025, with EBP funding reaching $18 billion. New drug approvals also remain robust, with 55 approvals in 2023 and approximately 50 in 2024, creating a consistent demand for commercialization and post-market services. The Real-World Evidence (RWE) oncology solutions market alone is projected to grow at a CAGR of 14.7% to $3.51 billion by 2035, while the broader Life Science Analytics Market is expected to reach $68.81 billion by 2030, growing at an 11.4% CAGR. These trends underscore a significant and expanding addressable market for IQVIA's integrated offerings.

Competitive Landscape and Strategic Positioning

IQVIA operates in a highly competitive landscape, facing both direct and indirect rivals. Direct competitors include major Contract Research Organizations (CROs) and healthcare data analytics firms such as ICON plc (ICLR), LabCorp (LH), Thermo Fisher Scientific (TMO), and Medpace Holdings (MEDP). IQVIA's market positioning is differentiated by its comprehensive, integrated approach, which combines clinical research with extensive data, analytics, and commercialization services. This allows IQVIA to offer end-to-end solutions that many competitors cannot match, particularly in leveraging real-world data and AI-driven insights across the entire drug lifecycle.

Against ICON plc, IQVIA's diversified service offerings, spanning analytics and sales solutions, provide a broader growth trajectory, while ICON often demonstrates agility in specialized clinical trial execution. Compared to LabCorp, IQVIA excels in technology-enabled analytics and cloud-based RWE solutions, offering greater efficiency in data dissemination, whereas LabCorp maintains strength in traditional laboratory and diagnostic testing. While Thermo Fisher Scientific leads in scientific instrumentation and research tools, IQVIA differentiates itself with analytics and consulting services that integrate technology with clinical insights, focusing on patient outcomes. Medpace Holdings specializes in early-phase trials, but IQVIA's comprehensive analytics and technology solutions offer broader integration capabilities.

IQVIA's strategy to "See More, Win More" involves aggressively expanding its market reach, responding to more RFPs, and increasing win rates across all customer segments. This approach, coupled with its global scale and deep domain expertise, positions IQVIA as a resilient leader capable of capturing market share even in a tighter competitive environment. While pricing pressures can emerge due to intense competition, IQVIA's focus is on securing business to build its substantial backlog, accepting some short-to-medium-term margin pressure to ensure long-term growth.

Technological Differentiation and Innovation: The AI Advantage

IQVIA's core differentiated technology lies in its "IQVIA Connected Intelligence" platform, which is increasingly powered by "Healthcare-grade AI." This technology is not merely an add-on but is deeply embedded across its operations, offering specific, tangible benefits. For instance, IQVIA is actively developing and deploying highly specialized AI agents. By Q1 2025, over 20 agents were in production across commercial, real-world, and R&DS segments, with plans to scale to 40 use cases by the end of 2025 and 500 agents by early 2027.

These AI agents deliver quantifiable improvements:

• A multi-agentic system for literature review has expanded capacity by 10x.
• Another agent reduces delivery time for patient journeys by two-thirds (from 12 weeks to 4 weeks), achieving a net 30% cost reduction.
• AI tools are used to compare patient cohorts and highlight differences in natural language output, reducing cycle times from several weeks to a couple of weeks.

The company's collaboration with NVIDIA (NVDA), announced in 2024, is pivotal to accelerating the introduction of these AI agents, transforming workflows and making AI agents "digital companions" to researchers, healthcare professionals, and patients. This technological leadership has been recognized, with Everest Group naming IQVIA a "front-runner generative AI leader" for the life sciences industry, the only CRO to receive this highest ranking. For investors, this technological differentiation translates into a significant competitive moat, driving operational efficiencies, enhancing service delivery, and enabling IQVIA to secure larger, longer-term integrated deals, thereby strengthening its market positioning and long-term growth strategy.

Segmental Performance and Operational Excellence

IQVIA's diversified business model is reflected in the performance of its three segments:

Technology & Analytics Solutions (TAS)

The TAS segment has been a standout performer, demonstrating strong recovery and consistent growth. For the three months ended September 30, 2025, TAS reported revenues of $1,631 million, an increase of 5% year-over-year (3.3% at constant currency). Year-to-date September 30, 2025, revenues reached $4,805 million, up 6.7% (5.8% at constant currency). This growth is primarily fueled by ongoing momentum from new drug launches and the strength of IQVIA's commercial portfolio. The real-world evidence (RWE) business within TAS has been particularly robust, achieving double-digit growth in Q3 2025. This segment's success is driven by increasing demand for integrated solutions that combine information, analytics, and services, allowing IQVIA to secure larger, longer-term engagements.

Research & Development Solutions (R&DS)

R&DS, while experiencing some market volatility in early 2025, has shown significant signs of recovery. Net bookings in Q3 2025 totaled $2.6 billion, resulting in a healthy net book-to-bill ratio of 1.15x. This represents a 5% sequential increase and a 13% year-over-year increase in bookings, marking a 21% rise from the Q1 2025 trough. The qualified pipeline for R&DS was up 6% year-over-year in Q3 2025, with RFP flow growing 20% year-over-year across all segments. The segment's backlog reached a new record of $32.4 billion as of September 30, 2025, with approximately $8.1 billion expected to convert to revenue in the next twelve months. This strong backlog and improving demand metrics indicate a positive trajectory for R&DS, supported by the completion of most large pharma reprioritizations and improving biotech funding. IQVIA's strategic collaboration with Sarah Cannon Research Institute (SCRI) to transform oncology trials further solidifies its leadership in this critical therapeutic area.

Contract Sales & Medical Solutions (CSMS)

The CSMS segment demonstrated strong growth in Q3 2025, with revenues of $209 million, up 16.1% year-over-year (13.9% at constant currency). Approximately one-third of this growth was attributed to an acquisition, NEXT Oncology, an SMO specialty in oncology, completed at the end of Q3 2025. IQVIA is strategically expanding its capabilities in CSMS to capitalize on a growing trend among large pharma clients to outsource commercial operations for established brands. These often involve large, multiyear engagements where IQVIA's integrated information, analytics, and local sales force footprint provide a unique advantage.

Financial Health and Capital Allocation

IQVIA's financial performance in 2025 has been strong, with revenue and profit consistently at the high end of guidance. For the nine months ended September 30, 2025, total revenues were $11,946 million, and net income attributable to IQVIA Holdings Inc. was $846 million. The company's adjusted EBITDA for the same period was $2,742 million.

A significant highlight is IQVIA's robust cash flow generation. Q3 2025 saw a record quarterly free cash flow of $772 million, reflecting disciplined working capital management and an improved industry backdrop. For the nine months ended September 30, 2025, net cash provided by operating activities increased by $88 million to $1,919 million, primarily driven by an increase in cash from unearned income.

While cash used in investing activities increased by $67 million to $1,201 million due to business acquisitions and investments, cash used in financing activities increased by $182 million to $685 million, largely due to debt and finance lease payments and common stock repurchases.

As of September 30, 2025, IQVIA maintained a healthy cash balance of $1,814 million. The company's gross debt stood at $15,034 million, with a net debt of $13,143 million, resulting in a net leverage ratio of 3.52x trailing 12-month adjusted EBITDA.

IQVIA actively manages its capital structure, having issued $2 billion in senior notes in Q2 2025 to repay existing borrowings. The company also remains committed to returning capital to shareholders, repurchasing $1,032 million of common stock during the first nine months of 2025 under its equity repurchase program, which had a remaining authorization of approximately $1,981 million as of September 30, 2025.

Outlook and Guidance: A Confident Path Forward

IQVIA has reaffirmed and narrowed its full-year 2025 guidance, underscoring management's confidence in its strategic direction and operational execution. The company expects full-year 2025 revenue to be between $16.150 billion and $16.250 billion, representing year-over-year growth of 4.8% to 5.5% (5.2% at the midpoint). This guidance incorporates an approximate $100 million step-down in COVID-related revenue (entirely in R&DS), a 100 basis points tailwind from foreign exchange, and a 150 basis points contribution from acquisitions. Adjusted EBITDA is projected to be between $3.775 billion and $3.8 billion, growing 2.5% to 3.1%, while adjusted diluted EPS is expected to be between $11.85 and $11.95, an increase of 6.5% to 7.4%.

For the fourth quarter of 2025, IQVIA anticipates revenues between $4.204 billion and $4.304 billion, adjusted EBITDA between $1.033 billion and $1.058 billion, and adjusted diluted EPS between $3.35 and $3.45. This outlook assumes foreign currency rates as of October 27, 2025, for the remainder of the year. Management expects R&DS growth rates to improve sequentially in the latter half of 2025, driven by the resumption of one of two previously delayed mega trials, which is now confirmed to start towards the end of 2025. The other mega trial is now pushed to 2026 due to client-specific logistical reasons.

Risks and Challenges

Despite the positive outlook, IQVIA faces several risks. The market environment remains unsettled due to ongoing uncertainty regarding U.S. administration policies affecting the biopharmaceutical industry. This has historically led to delayed client decision-making and elevated cancellations, though management believes the bulk of large pharma reprioritizations is complete. Geopolitical unrest, high interest rates, and inflation continue to pose macroeconomic challenges. While IQVIA's direct exposure to potential tariffs is immaterial, such policies could impact its customers. The company also manages "stranded costs" associated with delayed trials, which can temporarily affect gross margins. However, IQVIA's diversified portfolio, strong client relationships, and proactive "See More, Win More" strategy are designed to mitigate these pressures.

Conclusion

IQVIA Holdings Inc. demonstrates a compelling investment thesis rooted in its diversified service offerings, technological leadership, and robust financial management. The company's ability to deliver strong revenue and profit growth, coupled with record free cash flow, highlights its operational resilience in a dynamic healthcare landscape. With its "IQVIA Connected Intelligence" platform and aggressive adoption of AI, IQVIA is not merely adapting to industry trends but actively shaping them, driving efficiencies for clients and enhancing its own competitive advantages. The improving demand environment in R&DS, particularly with a record backlog and normalizing cancellation rates, combined with the consistent strength of TAS, positions IQVIA for sustained growth. While macroeconomic and policy uncertainties persist, IQVIA's strategic initiatives, technological differentiation, and disciplined capital allocation provide a strong foundation for continued value creation for investors.