Neogen (NEOG) Q4 2026 earnings summary

Executive summary

• Fiscal year 2026 ended with strong sequential core growth in both food safety and animal safety segments, reversing negative trends from the prior year.

• Achieved Q4 FY26 Food Safety core revenue growth of 5.8%, the highest since FY23, with overall FY26 core revenue growth at 1.9%.

• Strategic focus is on commercial excellence, high-impact innovation, and operational efficiency to drive profitable growth and industry leadership.

• Genomics business divestiture expected to generate $140M in net proceeds, primarily for debt repayment.

• Transformation initiatives and cultural improvements are underway, with employee engagement metrics showing double-digit improvement.

Financial highlights

• Q4 revenue was $225.3 million, up 4.3% core growth year-over-year, the highest rate of the fiscal year.

• Food safety segment delivered $166.8 million in revenue, with 5.8% core growth; animal safety saw 0.5% core growth year-over-year and 7% sequential growth.

• Gross margin for Q4 was 47.8%, with adjusted gross margin at 49.7%, up 330 basis points year-over-year.

• Adjusted EBITDA for Q4 was $45.4 million (20.2% margin), up 12% year-over-year; adjusted net income was $18.7 million and adjusted EPS was $0.09.

• Cash flow from operations exceeded $30 million in Q4, with free cash flow over $26 million.

Outlook and guidance

• Fiscal 2027 revenue guidance is $880–$885 million, with adjusted EBITDA of $180–$182 million and a margin of 20.5%.

• Core growth guidance is approximately 3%, with food safety expected to outpace animal safety.

• R&D spending to increase by 50% in FY27, aiming for 5% of revenue over time.

• Transformation investments of $25 million planned for FY27, excluded from adjusted financials.

• Q1 2027 revenue guidance is $207–$209 million, with adjusted EBITDA of ~$37 million.