WAT
WAT
Waters Corporation
$334.44
-$0.49 (-0.15%)
Mkt Cap: $21.80B
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Outstanding Debut as Combined Company Drives Waters Corporation EPS Beat (WAT Q1 2026 Earnings Call)

By Dr. Graph | Updated on May 13, 2026 | earnings

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Waters Corporation delivered an exceptional first quarter as a newly combined entity, driven by double-digit organic growth in its core analytical instruments and better-than-expected early performance from its newly acquired BD Biosciences and Diagnostics businesses, prompting management to raise full-year guidance.

Outstanding Debut as a Combined Company Drives EPS Beat

Waters Corporation reported an excellent first quarter, generating total as-reported revenue of $1.267 billion. This top-line performance was driven by the legacy organic business, which generated $747 million and grew 11% in constant currency. This organic growth beat the high end of management's guidance by 200 basis points. The newly acquired Biosciences and Diagnostic Solutions businesses contributed $520 million, exceeding revenue guidance by $40 million. These acquired segments achieved an estimated 7% reported growth versus the prior-year equivalent period. This strong revenue execution, combined with disciplined cost management, drove a 20% year-over-year increase in adjusted earnings per share to $2.70.

Full-Year Organic and EPS Outlook Raised on Q1 Strength

Fueled by the robust first-quarter results and strong ongoing momentum, management raised its full-year 2026 financial targets. The company increased its full-year organic constant currency revenue guidance to a range of 6.5% to 8%. Incorporating the acquired businesses, total 2026 reported revenue is expected to be approximately $6.405 billion to $6.455 billion. Consequently, management raised its full-year adjusted earnings per share guidance by $0.10 to a range of $14.40 to $14.60. This updated outlook represents 10% to 11% earnings growth for the year. For the second quarter, Waters expects organic constant currency revenue growth between 6% and 8%.

Broad-Based Strength in Analytical Sciences and Diagnostics

The Analytical Sciences division delivered 12% constant currency growth, reflecting broad-based strength. Instruments were up 8%, chemistry surged 13%, and services grew 14%. The pharmaceutical end market performed exceptionally well, growing mid-teens globally and over 50% in China. The newly acquired segments also showcased positive momentum under Waters' rapid 180-day revitalization plan. The Biosciences division delivered $230 million in revenue, while Diagnostic Solutions generated $288 million. Product innovation continued with the accelerated launch of the BACTEC FXI next-generation blood culture system. Additionally, the company received FDA clearance for the BD Onclarity HPV self-collection kit for at-home cervical cancer screening.

Unlocking Value in the Newly Acquired BD Assets

During the Q&A, analysts focused on the swift turnaround and synergy realization of the BD assets. Chief Executive Officer Udit Batra detailed how the 180-day execution plan is immediately bearing fruit. This includes increased sales call volumes, stricter deal desk pricing discipline, and cross-selling analytical instruments. Batra highlighted a significant near-term opportunity discovered during a review of 1,600 U.S. Diagnostic Solutions reagent rental contracts. The team found approximately 700 contracts were out of compliance, representing a double-digit million annual revenue shortfall. Furthermore, the company is moving rapidly to localize flow cytometry manufacturing in China to regain market share.

Disclaimer: This report is for informational purposes only and does not constitute financial or investment advice. Always conduct your own research or consult a qualified professional before investing. Past performance is not indicative of future results.

Frequently Asked Questions

How did Waters' legacy business perform in the first quarter?
The legacy Analytical Sciences division was a major growth driver, delivering 11% organic constant currency growth fueled by a 13% surge in chemistry, an 8% increase in instruments, and exceptional mid-teens growth in the global pharmaceutical market.
How are the newly acquired Biosciences and Diagnostic Solutions businesses performing?
The acquired BD assets are outperforming expectations, delivering $520 million in revenue during the owned period and beating guidance by $40 million as management's 180-day revitalization plan yields immediate commercial improvements.
What are Waters Corporation's financial expectations for the full year 2026?
Due to strong first-quarter execution, Waters raised its full-year organic constant currency revenue growth guidance to a range of 6.5% to 8% and increased its adjusted EPS guidance to $14.40 - $14.60.