What happened

Quidel (QDEL) stock was popping on Friday with shares jumping 11.3% as of 11:02 a.m. ET. The impressive gain came after the company announced its 2021 fourth-quarter and full-year results following the market close on Thursday.

The diagnostics testing company reported fourth-quarter revenue of $636.9 million. Although this reflected a sharp 21.2% year-over-year decline, it still narrowly topped the consensus estimate.

Quidel also posted adjusted Q4 earnings of $7.29 per share. This result was much lower than adjusted earnings of $11.07 per share in the prior-year period. However, it blew past the average analysts' estimate of $4.89 per share.

So what

It might be surprising at first glance to see Quidel's steep revenue and earnings declines along with a surge for the life sciences stock. But this move underscores just how much stocks are driven by expectations.

There was one main reason behind those negative year-over-year comparisons. Sales for Quidel's Sofia 2 Flu + SARS antigen fluorescent immunoassay plunged by $249 million. While the company's QuickVue COVID-19 products picked up some of the slack, they have lower margins.

COVID-19 continued to be the big story for Quidel in the fourth quarter of 2021. Revenue for its COVID-19 products totaled $511.8 million, up from $405.3 million in the prior-year period.

A person with a swab in the nose.

Image source: Getty Images.

Now what

Quidel's fortunes will depend largely on COVID-19 for the immediate future. The good news is that CEO Douglas Bryant said in the company's press release that the "demand for COVID-19 testing remains elevated" in the early months of 2022.

However, there are other growth drivers for Quidel on the way. The company is gearing up for the U.S. launch of its Savanna multiplex molecular platform. This platform enables testing of as many as 12 pathogens from a single sample in under 25 minutes. Quidel also hopes to close on its acquisition of Ortho Clinical Diagnostics in the first half of this year.