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    BDX
    Earnings call· Jun 2026(Q3 FY26)

    BECTON DICKINSON & Q3 FY26 earnings call BDX

    Aug 6, 2026 Source

    Executive summary

    Becton, Dickinson and Company Q3 FY26 — Strong Growth Platforms Drive Beat and Raise

    BD delivered a strong Q3 FY26, exceeding revenue and EPS expectations, driven by broad-based commercial momentum and double-digit growth in key platforms like biologic drug delivery and advanced patient monitoring. The company raised its full-year revenue outlook to the high end of its low single-digit range and increased adjusted EPS guidance, reflecting confidence in its 'new BD' strategy and operational execution. While navigating headwinds from Alaris, vaccines, and China, management emphasized the positive mix benefits and productivity gains from BD excellence, with preliminary FY27 outlook suggesting modest EPS leverage despite Alaris remediation ending.

    Highlights

    5

    • Revenue of $5 billion, up 4.4% FX-neutral, exceeding expectations.

    • Adjusted EPS of $3.23, up 4.9%, ahead of expectations.

    • Over 90% of portfolio delivered high single-digit growth, with several growth platforms achieving double-digit growth.

    • Free cash flow increased 45% year-to-date to $1.7 billion.

    • Approximately 100 agreements signed across novel and biosimilar GLP-1 programs, driving double-digit growth in biologics.

    Concerns

    3

    • Adjusted operating margin down 130 basis points year-over-year to 24.9%, impacted by 110 basis points of tariff costs.

    • Alaris capital comparison created a 100 basis point headwind to revenue growth in Q3 FY26, expected to be 200 basis points in Q4 FY26 and FY27.

    • Continued pressure from vaccines and China market dynamics partially offset growth.

    Guidance & targets

    9
    CategoryTargetConfidence
    Full-year FY26 Revenue Growth (FX-neutral)
    toward the high end of our low single-digit range
    high materiality
    High
    Full-year FY26 Adjusted EPS
    $12.62 to $12.72
    high materiality
    High
    Full-year FY26 Currency Tailwind to Revenue
    about 100 basis points
    medium materiality
    High
    Full-year FY26 Adjusted Operating Margin
    approximately 25%
    high materiality
    High
    Full-year FY26 Adjusted Effective Tax Rate
    between 16% and 17%
    medium materiality
    High
    Full-year FY27 Revenue Growth
    low single-digit revenue growth
    high materiality
    Medium
    Full-year FY27 EPS Growth
    modest leverage on that earnings
    high materiality
    Medium
    Net Leverage Target
    2.5x
    medium materiality
    High
    Free Cash Flow Conversion Target
    90%
    medium materiality
    High

    Segment performance

    4
    SegmentRevenueYoYQoQMargin
    Medical Essentials
    MDS benefited from share gains in Vascular Access Management and utilization recovery in the U.S., partially offset by China pressure. Specimen Management driven by share gains in BD vacating portfolio, improved supply, and competitive backorder capitalization.
    MDS US growth: strongSpecimen Management growth: high single-digit
    		—3.2%——
    Connected Care
    Led by double-digit growth in Advanced Patient Monitoring (APM) consumables. MMS driven by dispensing and ROA pharmacy automation, with strong infusion set performance. Partially offset by difficult prior year comparison in Alaris Capital.
    Advanced Patient Monitoring growth: double-digitMMS growth: low single-digitsDispensing growth: double-digit
    		—4.4%——
    Biopharma Systems
    Driven by double-digit growth in biologics, particularly GLP-1s. Partially offset by lower demand for vaccine products. Growth was mid-teens excluding vaccine impact.
    Biologics growth: double-digitGLP-1 programs: approximately 100 agreements signedGrowth excluding vaccines: mid-teens
    		—5.2%——
    Interventional
    Solid mid-single-digit growth across the segment. PI growth led by oncology and peripheral vascular disease, partially offset by China market dynamics. UCC led by PureWick. Surgery performance driven by infection prevention and advanced tissue regeneration.
    Segment growth: solid mid-single-digitPI growth drivers: oncology, peripheral vascular diseaseUCC growth driver: PureWick double-digit growthSurgery growth drivers: infection prevention, advanced tissue regeneration double-digit growth
    		—5.5%——

    Operational metrics

    22
    Revenue Growth
    4.4%YoY
    Q3 FY26

    Company-wide revenue growth.

    Portfolio Growth
    high single-digit
    Q3 FY26

    Growth rate for the majority of the portfolio, excluding specific headwinds.

    Adjusted Operating Margin
    24.9%down 130 bps YoY
    Q3 FY26

    Company-wide adjusted operating margin.

    Tariff Impact on Operating Margin
    110
    Q3 FY26

    Impact of tariffs on adjusted operating margin.

    Share Repurchases
    $2.3B
    YTD Q3 FY26

    Amount of share repurchases year-to-date.

    Dividends Paid
    $0.9B
    YTD Q3 FY26

    Amount of dividends paid year-to-date.

    Total Capital Returned to Shareholders
    $3.1B
    YTD Q3 FY26

    Sum of share repurchases and dividends year-to-date.

    Net Leverage
    2.9x
    Q3 FY26

    Net leverage ratio at quarter end.

    Alaris Revenue Headwind
    100
    Q3 FY26

    Impact of difficult prior year comparison in Alaris on revenue growth.

    Alaris Revenue Headwind
    200
    Q4 FY26

    Expected impact of difficult prior year comparison in Alaris on revenue growth.

    Alaris Revenue Headwind
    200
    FY27

    Expected impact of Alaris remediation ending on FY27 revenue growth.

    China Revenue Contribution
    4%
    Current

    China's portion of New BD revenue, expected to drop to 3% next year.

    APM Sales Team Growth
    15%
    FY26

    Growth in Advanced Patient Monitoring sales team in the U.S.

    APM Growth Contribution from Commercial Investments
    100 to 150
    Q3 FY26

    Contribution to APM's double-digit growth from incremental commercial investments.

    PureWick VA Channel Run Rate
    over $1M
    Monthly

    Monthly run rate achieved in the PureWick VA channel due to dedicated sales team investments.

    PI Sales Team Growth
    15%
    FY26

    Growth in Peripheral Intervention sales team in the U.S.

    GLP-1 Program Agreements
    approximately 100
    Current

    Number of agreements signed across GLP-1 programs in Biopharma Systems.

    Gross Productivity in Plants
    8%
    Q3 FY26

    Productivity improvements achieved through BD Excellence.

    Service Levels
    above 90%record highs
    Q3 FY26

    Achieved service levels, indicating strong supply chain performance.

    BD Excellence Kaizens
    over 2,000from 50 a year
    This year

    Increase in continuous improvement projects under BD Excellence.

    PureWick Double-Digit Growth Quarters
    7
    Current

    Number of consecutive quarters PureWick has achieved double-digit growth.

    Resin and Molded Plastic Components as % of COGS
    5%
    Current

    Proportion of COGS represented by oil-derived components.

    Industry KPIs

    12
    MetricValueDetails
    Tariff impact110bps
    System utilization—
    Pricing realized price—
    New product launch rampaccelerating
    Procedure volume growthsolid
    FCF conversion leverage guidance2.9xx
    Installed base system placements—
    Segment franchise organic growthhigh single-digit%
    Consumables recurring revenue mix—
    Sales force commercial capacity build15%%
    Indicated addressable patient populationapproximately $2BUSD
    Pivotal trial clinical evidence milestonescompelling clinical trial results

    Product announcements

    3
    ProductTypeDetails
    Liverty TIPS stent graftlaunch
    Elyra Thulium Fiber laser systemlaunch
    Acumen IQ Plus finger cuff and Smart Pressure controllerlaunch

    Deals & partnerships

    1
    EMSCollaboration for launch of semaglutide therapy using BD's Vistra injection pen.

    EMS is one of Brazil's leading pharmaceutical companies. The partnership involves utilizing BD's Vistra injection pen for a semaglutide therapy in one of the region's largest healthcare markets.

    Risks & headwinds

    5
    Alaris remediation endingQ3 FY26, Q4 FY26, FY27

    100 bps headwind to revenue in Q3 FY26; 200 bps headwind to revenue in Q4 FY26 and FY27

    Mitigation: Company expects this headwind to end in FY27, lifting the drag on growth and allowing return to mid-single-digit algorithm.

    Lower demand for vaccine productsQ3 FY26, expected to be lapped in Q4 FY26

    Partially offset growth in Biopharma Systems; Biopharma Systems grew mid-teens excluding vaccine impact.

    Mitigation: Seeing stabilization and positive signs; preliminary order patterns not showing a repeat level of headwind in FY27. Expect to lap the headwind next quarter.

    China market dynamics and pressureQ3 FY26, ongoing

    Partially offset growth in MDS and PI; China represents 4% of new BD revenue, expected to drop to 3% next year.

    Mitigation: China is a much smaller portion of the 'new BD' portfolio, reducing its overall impact on company results.

    Tariff impact on operating marginQ3 FY26, ongoing

    110 basis points impact on adjusted operating margin in Q3 FY26

    Mitigation: Offset by productivity gains from BD excellence and favorable mix.

    Potential for higher input costs from oil-based resins and molded plastic componentsOngoing, particularly for FY27

    Resin and molded plastic components represent about 5% of COGS; if oil were to stay above $100, it would be a $60M-$70M impact on COGS.

    Mitigation: Proactive pricing actions already underway; assuming higher input costs and viewing any improvement as a positive.

    What to watch in Q4 FY26

    4

    Alaris Revenue Headwind

    Q4 FY26
    Current100 bps headwind in Q3 FY26
    Target200 bps headwind in Q4 FY26

    Why it matters

    This headwind is expected to double in Q4 and persist into FY27, significantly impacting overall revenue growth. Verifying its magnitude is crucial for assessing the company's ability to offset it with growth platforms.

    The major dynamic that the main dynamic reflects the Alaris comp dynamics. So we have highlighted at the beginning of the year that we're going to have higher compare -- a higher tough compare in Q4 because of the Alaris peak last year. So that adds a point of pressure on Q4 versus Q3, adding to 200 basis points of total pressure.

    Q&A highlights

    6

    Inquired about the broad-based momentum, particularly in the 90% of the business growing above trend, and if any one-time factors contributed, as well as the carry-over into FY27.

    Tom Polen attributed the strength to the payoff of strategic investments in growth platforms over the last five years, with four platforms growing double-digits and others high single-digits. He emphasized the purposeful reallocation of R&D and commercial investments into these areas, which also offer favorable mix benefits for margin expansion.

    “This is our first quarter as a focused med tech company. Those growth platforms, we had actually 4 of them growing double digits, the rest all growing high single digits in the quarter.”

    asked by Travis Steed · answered by Thomas Polen

    2 min read6 chapters

    Detailed Narrative

    01

    Growth Platform Momentum

    BD's 'new BD' strategy is yielding results, with over 90% of the portfolio delivering high single-digit growth and several key platforms achieving double-digit growth. These platforms, including biologic drug delivery, advanced patient monitoring, PureWick, and advanced tissue regeneration, are becoming more significant drivers of top and bottom-line performance due to their faster-growing markets and favorable mix benefits. The company is actively reallocating R&D and commercial investments to these areas to sustain momentum.

    02

    Commercial Excellence Initiatives

    The company is enhancing its commercial approach by implementing changes to sales compensation, providing AI-powered tools for account visits, and reallocating sales headcount to high-growth areas. Targeted investments, such as a 15% increase in the APM sales team, contributed 100-150 basis points to APM's double-digit growth this quarter. Similar investments in UCC (PureWick VA channel) and PI also drove strong consecutive growth.

    03

    Innovation and Product Launches

    BD continues to focus its pipeline on attractive markets like connected care and chronic disease management. Recent Q3 launches include the Liverty TIPS stent graft in the venous market, the Elyra Thulium Fiber laser system for kidney stones, and the Acumen IQ Plus finger cuff and Smart Pressure controller for noninvasive monitoring. These launches demonstrate a more focused innovation model aimed at strengthening long-term growth.

    04

    Operational Excellence (BD Excellence)

    BD Excellence continues to drive operational efficiency, resulting in approximately 8% gross productivity in plants this quarter and service levels above 90%. This progress is attributed to plant consolidations, raw material savings, waste reduction, and higher efficiencies. The company is also investing in a standardized digital platform to deploy AI across its supply chain, expecting further productivity and service improvements.

    05

    GLP-1 Market Opportunity

    BD has secured approximately 100 agreements across novel and biosimilar GLP-1 programs, demonstrating strong pipeline momentum in biopharma systems. The company announced a new collaboration with EMS in Brazil for a semaglutide therapy utilizing its Vistra injection pen, highlighting the strategic importance of this market and the value of its innovative drug delivery technologies.

    06

    Hospital Utilization Trends

    Management observes solid hospital utilization, reflected in strong U.S. performance in MDS (up 6%) and specimen management (up 14%). An internal metric tracking tube utilization versus needle utilization indicates an increase in diagnostic testing per patient, suggesting higher acuity patients or more innovative cancer screening. This provides a bellwether view of general healthcare consumption.

    AI-generated summary of the company’s earnings call. Not investment advice.