Veralto (VLTO) Q2 2025 earnings summary

Executive summary

• Q2 2025 sales rose 6.4% year-over-year to $1,371 million, with core sales growth of 4.8% driven by both volume and price increases; net earnings reached $222 million ($0.89 per diluted share), and adjusted EPS grew 9.4% to $0.93.

• Free cash flow increased 35% year-over-year to $323 million, reflecting 145% free cash flow conversion and supporting disciplined capital allocation and an active M&A pipeline.

• Strong performance in both Water Quality and Product Quality & Innovation segments contributed to overall growth.

• Developed markets saw sales growth of 7.0%, led by North America (6.3%) and Western Europe (9.2%), while high-growth markets increased 5.0%.

• Raised full-year adjusted EPS guidance to $3.72–$3.80 per share, reflecting confidence in stable demand and strong first-half performance.

Financial highlights

• Total Q2 sales grew 6.4% year-over-year to $1.37 billion; core sales up 4.8%.

• Adjusted operating profit margin was 23.7%; adjusted EPS grew 9.4% to $0.93, $0.05 above guidance high.

• Gross profit increased 6% to $822 million; gross margin at 60%.

• Free cash flow in Q2 was $323 million, up $83 million year-over-year.

• Net earnings for the quarter were $222 million, up from $203 million year-over-year.

Outlook and guidance

• Full-year 2025 adjusted EPS guidance raised to $3.72–$3.80 (prior: $3.60–$3.70); core sales growth for 2025 now expected to be mid-single digits.

• Q3 adjusted EPS guidance is $0.91–$0.95; core sales expected to grow mid-single digits.

• Free cash flow conversion guidance maintained at 90%–100% of GAAP net income.

• Currency translation expected to be a 1% tailwind for full-year sales.

• Guidance incorporates estimated tariff increases and countermeasures.