Waters delivered a strong Q4 and FY2025, closing the BD Biosciences & Diagnostic Solutions acquisition. Management provided conservative 2026 guidance with strong organic growth expectations and outlined synergy targets ( $55M cost, $50M revenue) with significant upside potential from pricing and execution improvements at the acquired business. Q4 reported revenue grew 7% (6% cc) and adjusted EPS grew 10% to $4.53, at the high end of guidance.
Waters delivered a strong Q4 and FY2025, closing the BD Biosciences & Diagnostic Solutions acquisition. Management provided conservative 2026 guidance with strong organic growth expectations and outlined synergy targets ( $55M cost, $50M revenue) with significant upside potential from pricing and execution improvements at the acquired business. Q4 reported revenue grew 7% (6% cc) and adjusted EPS grew 10% to $4.53, at the high end of guidance.
Waters delivered a strong Q4 and FY2025, closing the BD Biosciences & Diagnostic Solutions acquisition. Management provided conservative 2026 guidance with strong organic growth expectations and outlined synergy targets ( $55M cost, $50M revenue) with significant upside…
Q4 reported revenue grew 7% (6% cc) and adjusted EPS grew 10% to $4.53, at the high end of guidance.
Full year 2025 revenue grew 7% (constant currency) with recurring revenue up 8%, driven by double-digit chemistry growth.
Guidance · revenue to $6.43B
Management guides to strong industry-leading 5.3% growth for the combined company, with multiple embedded conservative assumptions (e.g., excluding pricing improvements, reshoring, and China stimulus) leaving room for upside.
Management mentioned capital expenditures of $113 million in 2025, including tariff-related mitigation actions. No explicit forward-looking capex guidance was provided.
Management emphasized strong execution, industry-leading growth guidance, and synergy upside, while acknowledging headwinds in the acquired BD business.
“For like-for-like SKU, like-for-like geography, we are generating close to 400, 450 basis points on chemistry. On the overall portfolio basis, we are generating about 200 basis points of like-for-like SKU, like-for-like geography.”
“This reflects a strategically attractive shift to a model with superior economics. Together with our new feature releases, this supports a creative tailwind in 2027 with the incremental recurring revenue that it brings.”
“Starting with instrument replacement, there are approximately 22,000 flow and backpack instruments that are ripe for replacement.”
“The service attach was starting at a 40% number, and you've seen what we've already done in 2025 alone.”
| 지표 | 기간 | 범위 | 중간값 | 상태 |
|---|---|---|---|---|
| EPS | FY2026 | $14.30–$14.50 | $14.40 | GUIDED |
| EPS | FY2026 Q1 | $2.25–$2.35 | $2.30 | GUIDED |
| Revenue | FY2026 | $6.405B–$6.455B | $6.43B | GUIDED |
| Revenue | FY2026 Q1 | $1.198B–$1.211B | $1.2045B | GUIDED |
| 제시 시점 | 지표 | 목표 기간 | 가이던스 | 실제 | 결과 |
|---|---|---|---|---|---|
| FY2026 Q1 | EPS | FY2026 Q2 | $2.95–$3.05 | $3.05 | Met / beat |
| FY2026 Q1 | Revenue | FY2026 Q2 | $1.616B–$1.631B | $1.645B | Met / beat |
Waters' chemistry pricing power is running ahead of plan, with ~400-450 bps of like-for-like price increases in chemistry and ~200 bps overall, which it plans to apply to the newly acquired BD business that historically only achieved ~40-50 bps. — Significant untapped pricing power exists in the acquired BD business, which could drive substantial margin and revenue upside if Waters successfully applies its playbook.
“In China, demand weakened due to increased focus on reducing consumption and diagnostics testing, while the U.S. government shutdown affected the biosciences business as export approvals got delayed. At the same time, the point-of-care”
… control of the biosciences and diagnostic solutions business. With several months of integration planning behind us, we have clear line of sight to the initiatives that will drive the most value in the early innings of the integration. In the most recent quarter, BD Biosciences and Diagnostic Solutions results came in below expectations due to impacts that became apparent during the quarter. In China, demand weakened due to increased focus on reducing consumption and diagnostics testing, while the U.S. government shutdown affected the biosciences business as export approvals got delayed. At the same time, the point-of-care business was impacted by a milder flu season compared to the previous year. As we look ahead, our cost and revenue synergies are firmly on track. In 2026, we will make swift and decisive progress towards achieving the objectives we've laid out. On cost synergies, restructuring, procurement savings, and network optimization are key vectors that we expect to begin realizing this year. As a prudent starting assumption, we expect to realize approximately $55 million of adjusted EBIT from cost synergies in 2026. On revenue synergies, while there is …
The biosciences and diagnostics business has a large installed base of ~22,000 flow and backp instruments ripe for replacement, presenting a multi-year growth opportunity akin to the one Waters captured in its own core business.
… and will immediately establish a deal desk to manage pricing discipline. As a prudent starting assumption, we expect to realize approximately $50 million in revenue and $25 million in corresponding adjusted EBIT from revenue synergies in 2026. Let me now describe the first phase of revenue synergy realization in a little bit more detail. These are the same levers you've seen us execute successfully at Waters over the past five years. Starting with instrument replacement, there are approximately 22,000 flow and backpack instruments that are ripe for replacement. At the same time, a meaningful wave of new products are being launched, such as FaxDiscover A8, S8, A7, and Bactec FXI. To achieve our revenue synergy target of $20 million by year five, we need to drive an incremental 100 instrument replacements per year. To put that into perspective, during our prior indomitable replacement initiative at Waters, we delivered double the target in half the time. For service plan attachment, our 20 million revenue synergy target can be achieved by increasing attachment by approximately one percentage point per year, a rate that is more than consistent with our historical …
Waters sees opportunity to improve the acquired BD business’s service plan attachment, which is starting around 40%, compared to Waters' own strong performance.
Hey, thanks. Udi, you know, I think the two things people really want to dig into here are obviously the BD results this morning and, you know, the numbers obviously have deteriorated relative to the original deal model. So maybe just talk a little bit about, you know, your take on the numbers this morning, particularly for the lagging parts of the portfolio, you know, U.S. academic government, China, early stage research on the BD side, and how do we think about, you know, the path to recovery there? And then the second thing is, you know, instruments, right, and the Empower impact on that transition. Understand it's, you know, call it 250 basis point headwind this quarter. But how do we…
Thanks. So, Taiko, thanks for the two questions. So let me start with the BD diagnostic solutions and bioscience business first. Look, several issues emerged in Q4 that impacted the growth of both of those businesses that were not fully known in Q3, and I'll let Amol describe those in a few minutes. But what is important is that all of these will now be present in a lower baseline for us in 2026. to basically help us deliver the 2.5%, which we think has several upsides. Now, this reminds me of Waters almost five years ago, right? You couple this with a host of innovative new products in both diagnostic solutions and in bioscience across flow cytometry, as well as across the microbiology business and the molecular diagnostics business. You start at a fresh portfolio business. And so we are now really squarely focused on first improving the operational execution, for instance, by implementing a deal desk for pricing discipline and discounting discipline, ensuring launch readiness of this fantastic portfolio, just like we did with Alliance IS, and improving forecast accuracy to minimize surprises. And equally, after months of detailed integration planning, we're now ready to deliver the synergies be it around instrument replacement, e-commerce, or service attach. And look, I mean, the service attach was starting at a 40% number, and you've seen what we've already done in 2025 alone. So we're very confident to deliver the 50 million in webinar synergies and more. You add this to what a standalone guidance is, and you end up with over 5%, close to 5.3% in e-commerce. at the midpoint of the guide for the combined business. So we're feeling pretty good about that industry-leading growth rate as we head into 2026. Amol, do you want to comment on the dynamics of the two businesses in 2025?