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    DHR
    Earnings call· Jun 2026(Q2 FY26)

    DANAHER CORP /DE/ DHR

    Jul 21, 2026 Source

    Executive summary

    Danaher Q2 FY26 — Strong Growth Acceleration and Raised Full-Year EPS Guidance

    Danaher reported a solid second quarter with better-than-expected revenue, earnings, and cash flow, driven by accelerating core growth across its portfolio and strong commercial execution. Despite customer project timing impacting bioprocessing revenue, underlying order trends remain robust, and the company raised its full-year adjusted EPS guidance following the early close of the Masimo acquisition. Management is encouraged by stabilizing end markets and expects continued momentum into the second half of the year.

    Highlights

    5

    • Total sales were $6.3 billion, with core revenue up 3% year-over-year, accelerating from Q1.

    • Adjusted diluted EPS increased approximately 8% year-over-year to $1.94, leading to raised full-year guidance.

    • Generated $1.3 billion of free cash flow in the quarter, with a year-to-date FCF to net income conversion ratio of 124%.

    • Life Sciences businesses delivered 5.5% core revenue growth, their strongest quarter in several years, driven by improved end markets and innovation.

    • Closed the acquisition of Masimo ahead of schedule, which delivered high single-digit revenue growth in H1 and is expected to be immediately accretive to adjusted EPS.

    Concerns

    3

    • Bioprocessing core revenue grew low single digits, below expectations, due to a few large chromatography resin shipments moving out of the quarter, impacting growth by ~500 basis points or $50M-$60M.

    • Adjusted operating profit margin was 27.1%, down 20 basis points year-over-year, primarily due to lower respiratory revenue.

    • Developed markets saw a slight core revenue decline due to shipment timing in biotechnology and lower respiratory revenue.

    Guidance & targets

    8
    CategoryTargetConfidence
    Third quarter revenue growth
    approximately 2% to 3%
    high materiality
    High
    Third quarter core growth excluding respiratory testing
    approximately 5%
    high materiality
    High
    Full year 2026 core revenue growth outlook
    3% to 4%
    high materiality
    High
    Full year 2026 adjusted diluted net EPS
    $8.45 to $8.60
    high materiality
    High
    Third quarter adjusted operating profit margin
    approximately 26.5%
    medium materiality
    High
    Bioprocessing long-term growth outlook
    high single-digit
    high materiality
    High
    StatLab long-term growth
    high single digits
    medium materiality
    High
    Core revenue growth exit rate
    mid-single-digit
    high materiality
    High

    Segment performance

    3
    SegmentRevenueYoYQoQMargin
    Biotechnology
    Core revenue in Discovery and Medical saw solid growth in pharma and biopharma. Bioprocessing consumables growth was below expectations due to shipment timing, but underlying order trends remain robust.
    Discovery and Medical Core Revenue Growth: mid-single digitsBioprocessing Core Revenue Growth: low single digitsBioprocessing Consumables Order Growth: mid-teensBioprocessing Equipment Order Growth: mid-teens
    		—2.5%——
    Life Sciences
    Strongest quarter in several years, led by Pall's microelectronics. Investment from large pharma and biopharma customers strengthened, and biotech demand benefited from a more favorable funding environment. Solid growth at Beckman Life Sciences, Leica Microsystems, and SCIEX.
    Pall's Applied Filtration Core Revenue Growth: approximately 10%Life Sciences Instrument Businesses Core Revenue Growth: mid-single digitsLife Sciences Consumables Businesses Core Revenue Growth: low single digitsIDT Performance: up, led by MRD testing solutionsAbcam Performance: growth accelerated, best quarter since acquisition
    		—5.5%——
    Diagnostics
    Performance was supported by continued adoption of recent menu expansions and key account wins at Cepheid. Declines in China began to moderate as pricing stabilized and volumes improved. Respiratory revenue was in line with expectations but down year-over-year.
    Core Growth excluding Respiratory Testing Revenue: 5%Clinical Diagnostics Businesses Core Revenue Growth: mid-single digitsClinical Diagnostics Businesses Core Revenue Growth (outside China): high single-digitLeica Biosystems and Radiometer Collective Growth: high single digitsCepheid's Core Nonrespiratory Revenue Growth: low double digits
    		—2%——

    Operational metrics

    12
    Adjusted diluted net earnings per common share
    $1.94up approximately 8% year-over-year
    Q2 FY26
    Gross profit margin
    57.6%
    Q2 FY26
    Adjusted operating profit margin
    27.1%down 20 basis points
    Q2 FY26

    Lower respiratory revenue year-over-year more than offset favorable impact of higher nonrespiratory volumes and disciplined cost management.

    Free cash flow to net income conversion ratio
    124%
    YTD

    Generated $2.4 billion in free cash flow in the first half of the year.

    Share repurchase
    $900 million
    Q2 FY26

    Believed to provide an attractive return given the long-term organic growth, earnings, and cash flow outlook.

    Bioprocessing revenue push-out impact
    ~500 basis points
    Q2 FY26

    Impact to overall bioprocessing growth due to customer production schedule changes and site readiness challenges for large chromatography resin shipments.

    Masimo H1 revenue growth
    high single-digit
    H1 FY26

    Masimo acquisition closed in early June, ahead of initial expectations.

    StatLab FY25 revenue
    $250 million
    FY25

    StatLab is a leading manufacturer of consumables across the anatomical pathology workflow, pending acquisition by Leica Biosystems.

    China core revenue growth
    mid-single-digit
    Q2 FY26

    Healthy growth across major regions, with Biotechnology delivering solid growth and Diagnostics improving sequentially.

    Respiratory revenue headwind
    150 basis points
    Q2 FY26

    Year-over-year headwind from lower seasonal infection rates, impacting overall revenue growth.

    Respiratory revenue
    ~$1.6 billion
    FY26

    Full year estimate, given where infection rates have trended.

    Academic end market revenue share
    <5%
    Q2 FY26

    Academic markets are watched with interest as a catalyst to innovation, but have limited economic impact on Danaher's growth.

    Industry KPIs

    11
    MetricValueDetails
    FCF conversion ROIC124%%
    Revenue EPS guidanceFY core revenue growth 3-4%, Adjusted EPS $8.45-$8.60% / USD
    China revenue exposuremid-single-digit%
    Pricing price realizationstabilized
    Diagnostics testing demandlow double digits%
    M a contribution synergiesMasimo immediately accretive to adjusted EPS; StatLab accretive to adjusted EPS in first full year
    Segment organic revenue growthBiotechnology 2.5%, Life Sciences 5.5%, Diagnostics 2%%
    Bioprocessing orders book to billmid-teens%
    Reshoring US manufacturing tailwindcontributing to revenue growth
    Instruments vs consumables services mixlow single digits (bioprocessing consumables), low single digits (life sciences consumables), mid-single digits (life sciences instruments)%
    Organic core revenue growth by end marketPharma & Biopharma healthy, Biotech funding improved, Academic & Government stabilized, Clinical & Applied strong

    Product announcements

    5
    ProductTypeDetails
    Biacore 8S SPR systemlaunch
    novus V55launch
    Access brain-derived p-Tau217 research use-only assaylaunch
    Access p-Tau217 assaylaunch
    AI-enabled opioid-induced respiratory depression detection solutionlaunch

    Deals & partnerships

    2
    MasimoAcquisition of a medical technology company.

    Acquisition closed in early June, ahead of initial expectations. Initial operating reviews validated opportunities for productivity, efficiency improvements, customer account synergies, and innovation process strengthening using the Danaher Business System.

    StatLabPending acquisition of a leading manufacturer of consumables across the anatomical pathology workflow.

    Acquisition by Leica Biosystems, expected to strengthen its value proposition by integrating consumables, instruments, automation, and digital pathology into a more complete workflow solution. Supports broader integrated delivery network strategy and goal of faster, more precise cancer diagnosis.

    Risks & headwinds

    4
    Bioprocessing customer project timing delaysQ2 FY26, Q3 FY26, FY27

    Approximately $50M-$60M impact to Q2 revenue (500 bps to growth); >$100M shifted out of Q2/Q3 into next year for full year.

    Mitigation: Underlying demand remains very healthy with mid-teens order growth in both consumables and equipment; no change to underlying trends; inventory levels in the market are lower than prior years.

    Lower respiratory testing revenueQ2 FY26, Q3 FY26

    Down year-over-year; 150 basis point headwind in Q2 FY26; approximately 250 basis point headwind in Q3 FY26.

    Mitigation: Offset by favorable impact of higher nonrespiratory volumes and disciplined cost management; nonrespiratory core growth accelerating.

    Developed markets core revenue declineQ2 FY26

    Declined slightly.

    Mitigation: Impacted by shipment timing in biotechnology and lower respiratory revenue; high-growth markets increased over 10%.

    China volume-based procurement and reimbursement changesLate 2024, Q2 FY26

    Impacted Diagnostics.

    Mitigation: Impact began to moderate in Q2 FY26, with pricing stabilizing and volumes improving sequentially.

    What to watch in Q3 FY26

    5

    Bioprocessing revenue push-out realization

    FY27
    Current>$100M shifted out of Q2/Q3 FY26
    TargetShipment of >$100M in FY27

    Why it matters

    This represents a significant portion of revenue that was delayed, and its realization is key to bioprocessing segment performance and overall growth.

    for the full year, we saw a little bit north of $100 million that shifted out of that Q2, Q3 into next year.

    Q&A highlights

    7

    Why is the Q2 bioprocessing revenue shortfall not being recovered in Q3/Q4, and what is the full-year impact of the shifted revenue?

    Management clarified that the Q2 impact was about 500 basis points or $50M-$60M, and over $100M of revenue shifted from Q2/Q3 into next year. They do not expect this to return in Q4 FY26, attributing it to customer production schedule changes and site readiness issues for large chromatography resin shipments.

    “for the full year, we saw a little bit north of $100 million that shifted out of that Q2, Q3 into next year. So that's a couple of hundred basis points to our bioprocessing growth for the full year.”

    asked by Michael Ryskin · answered by Matthew Gugino

    2 min read7 chapters

    Detailed Narrative

    01

    End Market Stabilization and Improvement

    Demand from large pharma and biopharma customers remained healthy, with improved biotech funding supporting funnel and order activity. Academic and government markets largely stabilized, while clinical and applied markets consistently showed strength across the portfolio. This broad improvement underpins the company's outlook for accelerating growth in the second half and beyond, reinforcing the benefit of balanced end market and geographic diversification.

    02

    Innovation Driving Growth

    Danaher highlighted several new product introductions strengthening its competitive position. These include Cytiva's Biacore 8S SPR system for high-throughput drug candidate screening, SCIEX's novus V55 AI-enabled mass spectrometry system for enhanced sensitivity and reduced operating costs, and Beckman Coulter's Access p-Tau217 assays for neurodegenerative diagnostics. These innovations are crucial for helping customers bring life-changing therapies and diagnostics to patients faster and more efficiently.

    03

    Geographic Performance

    Core revenues in developed markets saw a slight decline due to shipment timing in biotechnology and lower respiratory revenue. In contrast, high-growth markets increased over 10%, with mid-single-digit growth in China. Biotechnology in China delivered solid growth, partnering with local companies. Diagnostics in China also improved sequentially as the impact of volume-based procurement and reimbursement changes began to moderate from late 2024.

    04

    Capital Deployment and M&A Activity

    The company closed the acquisition of Masimo in early June, ahead of expectations, noting its immediate strategic and adjusted EPS accretion. Masimo delivered high single-digit revenue growth in the first half. Additionally, Leica Biosystems announced the pending acquisition of StatLab, a manufacturer of anatomical pathology consumables, which generated approximately $250 million in revenue for FY25 with over 85% recurring revenue and expected high single-digit long-term growth. Danaher also deployed $900 million to repurchase 5 million shares of common stock.

    05

    Bioprocessing Dynamics

    While bioprocessing core revenue grew low single digits due to customer-driven shipment timing for a few large chromatography resin orders, underlying demand remained robust with mid-teens order growth in both consumables and equipment. Management reiterated confidence in the high single-digit long-term outlook for the franchise, citing capacity expansion needs and onshoring activity. The delayed shipments, primarily for commercial programs, are not indicative of broad-based demand changes or inventory issues.

    06

    Life Sciences Segment Strength

    The Life Sciences segment achieved 5.5% core revenue growth, its strongest in several years. This was led by Pall's applied Filtration business, which grew approximately 10% driven by microelectronics. Life sciences instrument businesses saw mid-single-digit growth, and consumables businesses grew low single digits, with notable acceleration at Abcam and demand for MRD testing solutions at IDT. The segment is benefiting from stronger biotech funding and improved commercial execution.

    07

    Diagnostics Segment Performance

    The Diagnostics segment grew 2% core, or 5% excluding respiratory testing. Clinical diagnostics businesses were up mid-single digits, with high single-digit growth outside China. Cepheid's non-respiratory revenue increased low double digits, supported by menu expansions and key account wins. The company also highlighted Cepheid's support for the Ebola outbreak response in the Democratic Republic of Congo and Uganda through test donations.

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