(Reuters) - Thermo Fisher on Wednesday beat Wall Street estimates for quarterly profit and raised its annual profit forecast, betting on improved demand for its products and services used in drug development and sending shares up about 4% premarket.

The medical equipment maker in January signaled that muted demand for its services used in the making of therapies and vaccines will extend at least into the first half of the year, but could pick up later.

The Waltham, Massachusetts-based firm said it now expects annual adjusted profit of $21.14 to $22.02 per share, compared with its previous forecast of $20.95 to $22 per share.

Analysts had estimated a profit of $21.53 per share for 2024, according to LSEG data.

Contract drug manufacturers witnessed their biotech clients cut back on spending in 2023 amid rising interest rates. Some analysts have said that funding for biotechs could stabilize this year after a strong 2023 for regulatory approvals in the U.S.

Revenue in its laboratory products segment that provides products and services used in clinical trials and drug development came in at $5.72 billion, above analysts' expectations of $5.17 billion.

The segment makes up more than half of Thermo's total revenues of $10.35 billion, which also came in ahead of estimates of $10.17 billion.

On an adjusted basis, the company posted a profit of $5.11 per share, beating estimates of $4.71 per share, helped by new product launches during the quarter.

(Reporting by Sneha S K in Bengaluru; Editing by Devika Syamnath)