Danaher Corporation reported fourth-quarter fiscal 2025 revenues totaling $6.84 billion, marking a 4.5% increase compared with the same period in the previous year and slightly exceeding the consensus estimate of $6.81 billion. On a core basis, revenue advanced by 2.5%, aligning with forecasts for low single-digit increases.
The company's adjusted earnings per share reached $2.23, outperforming analyst expectations of $2.15, underlining Danaher's operational efficiency amid a complex economic environment.
Rainer Blair, Danaher's President and Chief Executive Officer, emphasized the team's disciplined execution as a key factor in surpassing quarterly targets. He noted, "We delivered a strong finish to the year with better-than-expected performance across our portfolio. We were particularly encouraged by continued strength in our bioprocessing business, along with improved momentum in Diagnostics and Life Sciences. Our teams’ disciplined execution also enabled us to exceed our fourth quarter margin, earnings, and cash flow expectations."
Operational cash flow for the quarter stood at $2.1 billion, with adjusted free cash flow amounting to $1.8 billion. The adjusted operating profit margin in the fourth quarter was 28.3%, exceeding the anticipated figure of approximately 27%.
Segment Performance Highlights
The Biotechnology segment demonstrated strong sales growth, generating $2.033 billion compared to $1.87 billion in the previous year's quarter, with core growth calculated at 6%. The Life Sciences segment posted revenues of $2.09 billion, up modestly from $2.03 billion year-over-year, reflecting a core growth rate of 0.5%
The Diagnostics division exhibited encouraging momentum, with sales increasing from $2.64 billion to $2.72 billion, achieving a core growth rate of 2%. Within Diagnostics, Cepheid's respiratory revenue remained robust at approximately $500 million.
Fiscal Year 2026 Outlook
Looking forward to the 2026 fiscal year, Danaher expects the gradual improvement in end-market conditions observed throughout 2025 to persist. The company attributes its strong positioning for long-term value creation to its differentiated portfolio, the efficiency of the Danaher Business System, and a solid balance sheet.
Management forecasts adjusted earnings per share to be between $8.35 and $8.50, slightly bracketing the consensus estimate of $8.42. Core revenue growth is anticipated to range from 3% to 6%, with specific expectations for key segments as follows:
- Bioprocessing: Predicted to grow at a high single-digit rate, fueled predominantly by sustained strength in consumables demand; equipment demand is expected to remain flat.
- Discovery and Medical: Revenues forecasted to be flat, reflecting broader trends within the Life Sciences sector.
- Life Sciences Segment: Outlook assumes only moderate improvement in end-market dynamics.
- Respiratory: Expected revenue of about $1.8 billion, consistent with 2025 levels.
First Quarter 2026 Guidance
For the initial quarter of fiscal 2026, Danaher projects core revenue growth in the low single-digit range, with end-market conditions anticipated to be largely in line with those experienced in the fourth quarter of 2025.
Cepheid's respiratory revenue is forecasted to remain steady at approximately $500 million, contrasting with the roughly $625 million generated in the first quarter of the previous year. The company aims for an adjusted operating margin around 28.5% for the period.
Market Reaction
Following the earnings release, Danaher's shares declined by 2.23% to $230.50 during Wednesday trading, according to reported market data. This movement reflects cautious investor sentiment despite the company's positive financial results and forward-looking statements.