Healthcare Business News

Cerner's rising profits and bookings boost outlook

By Rachel Landen
Posted: July 24, 2014 - 5:15 pm ET

Cerner Corp. continues to benefit as hospitals and physician practices face increasing pressure to integrate information technology into healthcare delivery and the measurement of its quality and costs.

The Kansas City, Mo.-based IT company reported net income of $129 million in the second quarter of 2014, up 14.2% from the year-ago period. Revenue was up 20% to $851.8 million, compared with the same quarter of 2013. Management struck a confident note Thursday based on new business bookings that increased 15% from the year-ago period to an all-time second-quarter high of $1.08 billion.

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"Our outstanding second-quarter results reflect Cerner's strong position in a growing industry," Cerner's CEO Neal Patterson, said in a news release. "Healthcare providers face a growing list of measures and mandates that are putting pressure on them to lower costs while also improving quality."

Patterson cited Cerner's investments in research and development as one way the company is helping its clients address these issues. In its most recently filed annual report for the period ending Dec. 28, 2013, Cerner reported R&D investments in software of $418.7 million for the year.

In Thursday's announcement, management updated its full-year guidance for the company, anticipating annual revenue between $3.3 billion and $3.4 billion, up from a previously predicted range of $3.25 billion to $3.4 billion. Cerner's stock, hovering around $55.64 on the NASDAQ, was flat in after-hours trading.

Follow Rachel Landen on Twitter: @MHrlanden

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