Q4 2025 Waters Corp Earnings Call Transcript
Key Points
- Waters Corp (WAT) achieved high single-digit reported revenue growth and low double-digit adjusted EPS growth in the fourth quarter, reflecting strong sales performance.
- The acquisition of BD's Biosciences and Diagnostic Solutions business marks a transformative step, enhancing Waters Corp's position in high-growth adjacencies.
- Recurring revenue grew 9%, led by chemistry growth, and instruments grew 3%, driven by high single-digit LCMS growth.
- The transition to a subscription-based model for Empower is strategically attractive, offering superior economics and long-term recurring revenue benefits.
- Waters Corp (WAT) expects continued organic strength in 2026, supported by new product innovation and expansion into high-growth areas like bioseparations and bioanalytical characterization.
- TA instruments declined for the quarter due to cautious spending in the US and Europe, impacting overall instrument growth.
- BD Biosciences and Diagnostic Solutions results came in below expectations due to weakened demand in China and a milder flu season affecting the point-of-care business.
- The transition to a subscription-based model for Empower reduced the overall instrument growth rate by a low single-digit percentage for the quarter.
- The acquired BD businesses are expected to contribute only 2.5% underlying growth in 2026, reflecting a conservative outlook due to previous underperformance.
- Challenges in the US academic and government sectors, as well as early-stage research on the BD side, have impacted growth, requiring focused recovery efforts.
Good morning and welcome to the Waters Corporation [indiscernible] 2025 Financial Results Conference Call. (Operator Instructions) This call is being recorded. If anyone has any objections, please disconnect at this time. It is now my pleasure to turn the call over to Mr. Caspar Tudor, Head of Investor Relations.
Please go ahead, sir.
And good morning, everyone. Welcome to Waters Corporation's Fourth Quarter Earnings Call. Joining me today are Dr. Udit Batra, our President and Chief Executive Officer; and Amol Chaubal, our Senior Vice President and Chief Financial Officer. Before we begin, I will cover the cautionary language.
In this conference call, we will make various forward-looking statements regarding future events or future financial performance of the company, including the expected financial and operational impact of what is combination with the Biosciences and Diagnostic Solutions business of Becton, Dickinson and Company. We will provide guidance regarding possible future
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