Danaher (DHR) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue declined 1.0% year-over-year to $5.74 billion, with core sales flat as gains in Biotechnology were offset by declines in Life Sciences and Diagnostics; net earnings were $954 million ($1.32 per diluted share), down from $1.1 billion in Q1 2024.

• Adjusted diluted EPS was $1.88, down from $1.92 in Q1 2024; operating cash flow reached $1.3 billion, with free cash flow at $1.06 billion.

• Over 80% of revenues are recurring, mainly from consumables specified into regulated processes.

• Bioprocessing and molecular diagnostics showed strong momentum, with respiratory demand at Cepheid exceeding expectations.

• The company is proactively managing supply chains and investing in long-term growth despite a dynamic macro environment.

Financial highlights

• Gross profit margin was 61.2%, up 100 bps year-over-year; adjusted operating profit margin was 29.6%, down 50 bps; operating margin (GAAP) was 22.2%.

• Net earnings (GAAP) for Q1 2025 were $954 million, down from $1,088 million in Q1 2024; adjusted EBITDA margin was 32.7%.

• Free cash flow was $1.06 billion, with a conversion ratio over 110%; operating cash flow to net earnings conversion ratio was 1.36.

• Cash and equivalents stood at $2.0 billion at quarter-end; dividend payments totaled $194 million.

• SG&A expenses as a percentage of sales increased to 32.4% from 31.2% year-over-year.

Outlook and guidance

• Full-year 2025 core revenue growth expected at approximately 3%; full-year adjusted diluted EPS guidance set at $7.60–$7.75.

• Q2 2025 core revenue expected to grow low single digits year-over-year; Q2 adjusted operating margin projected at ~25.5%.

• End-market demand anticipated to remain consistent for the rest of 2025.

• Effective tax rate for the remainder of 2025 is projected at approximately 17.0%.

• The company expects to largely offset the impact of enacted tariffs through operational adjustments, but additional or delayed tariffs could materially increase costs.