Waters (WAT) investor relations material

Executive summary

• Q3 revenue was $1.767B, up 9% reported; organic revenue was $871M, up 10% in constant currency, and adjusted EPS rose 21% to $4.10.

• Revenue rose 5.2% sequentially, ahead of the 3.6% step-up embedded in guidance; orders exceeded organic sales by ~$20M.

• Strong consumables demand, instrument replacement, execution initiatives and acquisition synergies supported the stronger FY26 outlook.

Financial highlights

• Acquired Biosciences and Diagnostic Solutions revenue was $896M, up 1% reported; organic revenue was $871M, up 9% reported and 10% in constant currency.

• Adjusted gross margin was 55.8%, adjusted operating margin 30.1%, and adjusted EPS $4.10; GAAP diluted EPS was $0.82.

• Q3 free cash flow was $68M after ~$81M of integration, restructuring and SAP costs, plus $240M of timing items, primarily higher receivables and SAP migration.

• Revenue by region: Americas $749M, Europe $523M, and Asia $495M.

Outlook and guidance

• FY26 organic constant-currency growth guidance increased 140 bps at midpoint to 9.1%–9.7%; reported revenue guidance rose $43M at midpoint to $6.479B–$6.497B.

• FY26 adjusted diluted EPS guidance increased to $14.60–$14.70; adjusted EBIT margin is expected at 28.2%, with a 15.4% tax rate and $196M net interest expense.

• Q4 organic constant-currency growth is expected at 7%–9%; reported revenue at $1.801B–$1.819B and adjusted diluted EPS at $4.58–$4.68.

• Q4 guidance assumes double-digit days-adjusted growth in organic and acquired businesses; four fewer selling days and no budget flush are assumed.

• 2027 preliminary framework: mid-single-digit-plus combined organic growth, 29.2% adjusted operating margin and low-teens adjusted EPS growth; assumptions include high-single-digit legacy growth, mid-single-digit acquired-business growth and $60M of revenue synergies beyond 2026's $50M.