다나허(DHR) 2026년 3분기 실적 콘퍼런스 콜: 핵심 성장 가속화, EPS 가이던스 상향

핵심 요약

• 다나허는 2026년 3분기 매출 66억 달러를 기록했다고 발표했다. 핵심 매출은 3% 증가했으며, 호흡기 관련 매출을 제외하면 5.5% 증가해 2분기 대비 성장 폭이 100bp 확대되었다.
• 조정 영업이익률은 전년 동기 대비 110bp 상승한 29%를 기록했다. 조정 희석 EPS는 약 11.5% 증가한 2.11달러를 기록했다.
• 생명공학 핵심 매출은 5% 증가했고, 생명과학은 4.5% 증가했으며, 진단은 호흡기 매출 제외 기준 7% 성장했다.
• 바이오프로세싱 수주는 업스트림 소모품과 레진이 견인하며 10%대 중반 비율로 증가했다. 경영진은 2026년 바이오프로세싱 핵심 성장률이 한 자릿수 중반을 기록할 것이라는 기존 전망을 유지했다.
• 다나허는 2026 회계연도 조정 희석 EPS 가이던스를 기존 8.45~8.60달러에서 8.57~8.62달러로 상향 조정했다.
• 경영진은 2027년 호흡기 매출 제외 핵심 매출 성장률의 현재 출발점으로 4%~5%를 제시하면서, 공식 가이던스는 1월에 발표될 것임을 강조했다.

주요 재무 실적

사업 및 영업 실적

생명공학

생명공학 핵심 매출은 5% 증가했다. 바이오프로세싱은 한 자릿수 중반대 상단 수준으로 성장했으며, 소모품은 한 자릿수 중반, 장비는 한 자릿수 초반 증가했다.

수주는 업스트림 소모품과 레진에 힘입어 10%대 중반 비율로 증가했다. 장비 수주는 연초 대비 견조한 두 자릿수 범위를 유지했다. 경영진은 건전한 상업적 생산 활동과 강력한 신규 프로그램 파이프라인이 수요를 뒷받침했다고 밝혔다.

디스커버리 및 메디컬 핵심 매출은 한 자릿수 초반 비율로 감소했다. 단백질 연구 기기의 성장은 실험실 소모품 수주 시점 차이로 인해 상쇄되고도 남았다.

생명과학

생명과학 핵심 매출은 4.5% 증가했다. 폴(Pall)의 응용 여과 사업은 항공우주 및 마이크로일렉트로닉스에 힘입어 한 자릿수 중반 성장을 기록했다. 생명과학 분석 장비 역시 제약 및 바이오 제약 고객의 사이엑스(SCIEX) 수요, 미국 학술 지출의 소폭 개선, ZenoTOF 8600의 모멘텀에 힘입어 한 자릿수 중반 증가했다.

생명과학 소모품은 한 자릿수 초반 성장했다. IDT는 미세잔류질환(MRD) 및 차세대 염기서열 분석(NGS) 제품의 수혜를 보았고, 엡캠(Abcam)은 학술 수요 개선과 제약 및 바이오 제약 이니셔티브의 견인력을 확인했다.

경영진은 대형 제약 및 바이오 제약 수요가 견조하게 유지되었고 밝혔다. 학술 수요는 여전히 과거 수준을 밑돌았으나 직전 분기 대비 개선되었다.

진단

진단 부문 핵심 매출은 호흡기 제품을 제외하고 7% 성장했다. 약 650bp의 호흡기 매출 역풍을 포함하면 부문 핵심 성장률은 0.5%였다.

임상 진단은 한 자릿수 중반 성장했다. 라이카 바이오시스템즈(Leica Biosystems)는 디지털 병리 분야에서 강력한 모멘텀을 기록했고, 벡만 쿨터 진단(Beckman Coulter Diagnostics)은 2년 만에 가장 높은 북미 핵심 성장 분기를 달성했다. 경영진은 DxI 9000을 포함한 신제품과 중국 정책 관련 압력 완화를 주요 원인으로 꼽았다.

세페이드(Cepheid)의 비호흡기 분자 진단 매출은 A군 사슬알균, 바이러스학 및 성매개 감염 검사의 성장에 힘입어 10%대 초반 증가했다.

지역별 동향

선진국 시장 핵심 매출은 보합세를 보였다. 서유럽은 한 자릿수 중반 성장한 반면, 북미는 주로 호흡기 매출 감소로 인해 한 자릿수 초반 감소했다.

고성장 시장은 약 10% 증가했다. 중국은 3개 부문 모두에서 성장을 기록하며 한 자릿수 후반 증가했다. 경영진은 이러한 개선이 진단 분야의 헬스케어 정책 변화 영향 감소와 함께 생명공학 및 생명과학 자금 조달 및 투자 상태의 호전에 기인한 것으로 보았다.

AI, 혁신 및 인수합병

다나허는 엡캠(Abcam), 싸이티바(Cytiva), 벡만 쿨터 생명과학(Beckman Coulter Life Sciences), 제네데이터(Genedata), IDT, 분자 장치(Molecular Devices)의 기술을 결합한 최초의 AI 기반 자율 연구소를 발표했다. 경영진은 이 플랫폼이 아이디어에서 검증된 시약 단계까지 기존 모델보다 최대 8배 빠르게 진행되고 최대 10배 더 많은 용량을 생성하도록 설계되었다고 밝혔다.

회사는 다나허의 장비, 자동화 및 소프트웨어를 AI 및 첨단 컴퓨팅 기능과 연결하기 위해 엔비디아(NVIDIA)와도 협력하고 있다. 경영진은 AI 관련 수요가 아직 실질적인 수준은 아니지만 수주와 매출에 소폭의 이점을 제공하기 시작했다고 밝혔다.

마시모(Masimo)는 다나허 편입 후 첫 전체 분기 동안 한 자릿수 후반의 매출 성장을 기록했다. 경영진은 비용 절감 및 상업적 시너지 기회가 개발 단계에 있어 통합이 순조롭게 진행되고 있다고 밝혔다. 라이카 바이오시스템즈도 4분기 초 스탯랩(StatLab) 인수를 완료했다.

경영진 가이던스

경영진은 현재 수주 추세를 바탕으로 2027년에도 바이오프로세싱 성장이 지속적으로 개선될 것으로 예상했지만, 공식적인 부문 가이던스는 제공하지 않았다. 다나허는 장기적으로 바이오프로세싱을 지속 가능한 한 자릿수 후반의 매출 성장을 이룰 사업으로 계속 평가하고 있다.

리스크 및 주시 영역

• 호흡기 매출은 감염율과 독감 시즌 시기에 여전히 민감하게 반응한다. 경영진은 연간 수주액이 기준 가설을 중심으로 수억 달러 정도 변동할 수 있다고 밝혔다.
• 학술 수요는 직전 분기 대비 개선되었으나 여전히 과거 수준을 밑돌았다.
• 다나허의 2027년 성장 프레임워크는 예비적인 수준이다. 경영진은 1월에 세부 가이던스를 발표하기 전에 정상적인 4분기 계획 프로세스를 완료할 예정이다.
• 리쇼어링은 브라운필드 활동을 통해 현재 수주에 소폭 기여하고 있으나, 더 큰 규모의 그린필드 프로젝트는 여전히 기획 단계에 있다. 경영진은 손익(P&L)에 대한 보다 실질적인 기여가 2028년 이후에 시작될 것으로 예상한다.
• 3분기 조정 영업이익률은 관세 환급으로 인한 소폭의 혜택을 받았다.

애널리스트 Q&A 하이라이트

영업 실행력: 줄리 몽고메리 CEO는 수익성 있는 핵심 성장과 명확한 점유율 확대를 다나허의 핵심 성과 지표로 꼽았다. 회사는 다나허 비즈니스 시스템(Danaher Business System)을 통해 영업 실행을 표준화하고 관계사 간 협력 판매를 확대할 계획이다. 경영진은 연결형 진단 접근 방식을 통해 수억 달러 규모의 추가 매출 기회가 창출되었다고 밝혔다.

2027년 성장 프레임워크: 경영진은 호흡기 매출을 제외한 4%-5%의 핵심 성장을 공식 가이던스라기보다는 출발점으로 설명했다. 바이오프로세싱 수주 개선, 중국 정책 압력 완화, 최종 시장 회복 등이 논의되었으나, 회사는 세부 전망을 제공하기 전에 4분기 상황을 평가하고자 한다.

자본 배치: 몽고메리 CEO는 M&A가 여전히 다나허가 선호하는 자본 배치 방식이라고 밝혔다. 기존 입지를 강화하고 회사의 수익성 기준을 충족하는 거래에 중점을 둘 예정이다. 그녀는 마시모 인수가 광범위한 의료 기술 기업 인수 전략으로의 전환이라기보다 전략적으로 상호보완적인 지속적 진단 자산 확보라고 설명했다.

바이오프로세싱 및 리쇼어링: 경영진은 2027년에 바이오프로세싱 성장률이 개선될 것으로 예상하고 있다. 회사에 따르면 미국의 리쇼어링은 10억 달러 규모의 시장 기회가 될 수 있지만, 그 혜택은 수년에 걸쳐 구체화되어 주로 2028년부터 본격화될 것으로 예상된다.

AI 전략: 다나허는 실험 설계, 시약 생산 및 테스트에 이르는 자율 워크플로우를 통해 AI와 실제 실험을 연결할 계획이다. 내부적으로 경영진은 AI와 다나허 비즈니스 시스템이 영업 프로세스, R&D 일정 및 생산성을 향상시킬 것으로 기대한다.

실적 발표 컨퍼런스 콜 전문

전체 실적 발표 컨퍼런스 콜 녹취록

경영진 발표

Operator

My name is Chelsea, and I will be your conference facilitator this morning. At this time, I would like to welcome everyone to Danaher Corporation's Third Quarter 2026 Earnings Results Conference Call. [Operator Instructions]

I will now turn the call over to Ms. Rachel Vatnsdal, Vice President of Investor Relations. Ms. Vatnsdal, you may begin your conference.

Rachel Vatnsdal Olson

Good morning, everyone, and thanks for joining us on the call. With us today are: Julie Sawyer Montgomery, our President and Chief Executive Officer; and Matt Gugino, our Executive Vice President and Chief Financial Officer. I'd like to point out that our earnings release quarterly report on Form 10-Q, the slide presentation supplementing today's call, the reconciliations and other information required by SEC Regulation G relating to any non-GAAP financial measures provided during the call and a note containing details of historical and anticipated future financial performance are all available on the Investors section of our website, www.danaher.com, under the heading Quarterly Earnings.

The audio portion of this call will be archived on the Investors section of our website later today under the heading Events and Presentations and will remain archived until our next quarterly call. A dial-in replay of this call will also be available until November 4, 2026.

During the presentation, we will describe certain of the more significant factors that impacted year-over-year performance. Our Form 10-Q and the supplemental materials I referenced describe additional factors that impacted year-over-year performance. Unless otherwise noted, all references in these remarks and supplemental materials to company-specific financial metrics relate to results from continuing operations in the third quarter of 2026, and all references to period-to-period increases or decreases in financial metrics are year-over-year. We may also describe certain products and devices which have applications submitted and pending for certain regulatory approvals or are available only in certain markets.

During the call, we will make forward-looking statements within the meaning of our federal securities laws, including statements regarding events or developments that we believe or anticipate will or may occur in the future. These forward-looking statements are subject to a number of risks and uncertainties, including those set forth in our SEC filings, and actual results may differ materially from any forward-looking statements that we make today. These forward-looking statements speak only as of the date that they are made, and we do not assume any obligation to update any forward-looking statements, except as required by law.

With that, I'd like to turn the call over to Julie.

Julie Montgomery

Thank you, Rachel, and good morning, everyone. Before we get into the quarter, I'd like to share my perspective on Danaher today and the opportunity ahead as I begin this next chapter as CEO. The opportunity for Danaher is straightforward, to become the defining leader in life sciences and diagnostics, a company that unambiguously gained share, delivers sustainable profitable growth and helps our customers improve outcomes for patients around the world.

The foundation we built at Danaher is strong. We operate leading businesses, foster deep customer relationships and empower talented people, all enabled by the Danaher Business System. At the same time, growth over the past several years has not consistently reflected the full potential of our portfolio. We've navigated significant changes in our markets but regardless of the environment we hold ourselves to a higher standard. We see a meaningful opportunity to accelerate sustainable core revenue growth, gain share more consistently and more fully translate the strength of our portfolio into differentiated performance. I'm confident in what we've built and I'm energized by what I've seen across Danaher these last few months. Our focus now is strengthening execution and delivering on that potential.

Recently, I had a conversation with one of our executives preparing for a customer meeting related to Alzheimer's disease. What started as a discussion about how one of our businesses could help address a particular part of that customer's challenge, quickly expanded to cover the role seven different operating companies could play across discovery, AI-enabled target selection, laboratory automation, process development, scale-up and diagnostic testing.

And when the challenge is Alzheimer's disease, speed matters, both to the scientists working to understand it and the families waiting for answers. That conversation reinforced something important. Our customers don't think about their challenges through the lens of our organizational structure. They have a problem to solve, and they want the best partnership and solutions we can bring them. I see this as critical to Danaher's next chapter and some of our greatest opportunities sit at the intersections of our businesses. We will preserve what makes our operating company structure advantage, the customer intimacy, the accountability while making it easier to bring the full power of Danaher to our customers.

A foundation and the power of the Danaher Business System have given us leadership positions across the life sciences and diagnostic markets and a unique role in helping accelerate the translation of scientific discovery and to human impact. Our Life Science businesses enable discovery, our Biotechnology businesses help turn those discoveries into scale and accessible therapies and our diagnostics businesses helped guide treatment. Together, Danaher spans a broad path from experiment to patients with DBS adding speed and operating discipline at scale. We call that innovation at the speed of life, helping close the distance between human need and the science that answers it. And as we enter this next chapter, we'll accelerate that ambition by focusing on four strategic priorities: commercial excellence, innovation, talent and effective capital allocation. Each is important, but our most immediate opportunity is commercial execution.

Danaher has successfully repositioned its portfolio with three platforms across the life sciences and diagnostics markets. With that portfolio transformation largely complete, our focus is shifting from reshaping the portfolio to delivering more growth from the businesses we own. We will focus our leadership attention on exceptional commercial execution, enhancing our pursuit of unambiguous share gain across Danaher. We will drive consistency and rigor and commercial execution across our businesses. This means simplifying and strengthening our commercial processes and empowering our leaders to make more entrepreneurial decisions.

We also have an opportunity to make it easier for our customers to take advantage of the full power of Danaher. Our operating companies have important brands and deep customer relationships. These will remain fundamental to how we compete, but Danaher has tremendous scale and breadth, and we can do more to use that advantage. That means making the broader strength of our portfolio and capabilities more accessible to customers.

We've already taken practical steps to show up as a more connected Danaher. In diagnostics, for example, we are successfully deepening customer relationships by bringing leaders from our cross our businesses together with key customers to look across the portfolio, better understand their priorities, and identify where a more coordinated approach can create additional value. We do this by having our key diagnostics leaders in the same room at the same time with our key customers to understand their biggest pain points and where we can drive incremental value. This approach has generated meaningful incremental revenue opportunities and is helping drive share gains across our diagnostics businesses.

And as we bring more of Danaher to our customers, we can also become more systematic about connecting capabilities across our businesses to solve more customer needs. Danaher Cytiva's recent collaboration deliver an end-to-end mRNA solution is a great example, helping streamline our customers' development processes while meaningfully accelerating time lines.

Ultimately, our commercial strategy is straightforward: execute better and more entrepreneurially, show up together as Danaher for our customers and connect our capabilities where we can create greater value. We will make it easier for customers to access the full strength of Danaher and look to us when trying to solve their most important challenges.

Our second priority is delivering more innovation. Danaher is already at the forefront of innovation, but I believe strengthening our innovation capabilities represents one of our largest opportunities to accelerate long-term growth. Delivering on our brand promise, innovation at the speed of life means we will be deliberate and strategic about where we invest in R&D and ensure we appropriately allocate resources behind our best ideas. That means more closely linking strategy and R&D investments, concentrating resources behind the highest potential initiatives and working more closely across our businesses and external partners to move promising innovations faster.

We will also fund transformational opportunities at the enterprise level when we believe Danaher has a clear right to win and larger investment can create meaningful competitive advantage. These decisions will require clear choices and greater enterprise level conviction about where we can create the most value. Innovation cycles take time, but over the long term, we believe this more focused approach can support higher and more durable core revenue growth while turning more scientific discoveries into meaningful human impact. And to me, this is the heart of innovation at the speed of life, helping promising science move faster towards the patients who need it.

Our third priority is being the home and destination for exceptional talent. We believe our ability to attract and develop exceptional talent and scientific, AI, commercial and operating disciplines will increasingly set us apart from competitors. We also need to develop and deploy our people more intentionally against Danaher's highest priority growth and innovation opportunities.

Danaher has given me that kind of exposure in my own career learning DBS and then applying it across commercial, R&D and business leadership. I want us to continue to create exceptional opportunity for the next generation of leaders. As we evolve DBS for the AI era, I believe we can create an even more compelling place for the best talent in our industry.

And our fourth priority is being more disciplined with our capital and resources. M&A and capital deployment have been essential drivers of Danaher's growth and will remain so. We will maintain the robust investment criteria that has served us well for many decades while bringing strategic clarity and discipline to how we allocate capital and resources. We are focused on deepening our positions in attractive markets and identifying strategically compounding areas that build from the strengths we already have in our businesses. Our objective is to deliver high returns on our investments with greater consistency while positioning Danaher to sustainably differentiated and profitable growth.

Across each of these priorities, there is a common idea. We create more value by building a stronger, more connected company. That doesn't mean changing what makes our operating companies successful. It means preserving their customer intimacy and accountability while making it easier to share ideas, capabilities, talent and resources across Danaher and using our scale where it gives us an advantage.

AI is one capability we believe can help us do just that. We believe the combination of AI and DBS will be an important competitive advantage. CBS gives us a common way to solve problems, improve processes and scale what works across Danaher. We believe that approach can help us bring AI solutions to life faster and more effectively than many. Over time, we believe AI can make DBS simpler and more powerful while DDS can help us implement AI with the rigor and consistency to have long defined Danaher.

We see opportunities for AI to strengthen commercial execution and innovation. For example, helping our teams identify opportunities earlier, improved sales funnel management and dramatically reduce R&D time lines. AI can help simplify work and drive greater productivity. But AI isn't only about making Danaher better. It is also changing the needs of our customers and creating new opportunities across our portfolio. For example, we see growing demand for solutions that cut across our life sciences businesses that enable more automated and autonomous labs and workflows.

We also see longer-term opportunities across our Biotechnology and diagnostics platforms to make therapies more efficiently and make treatment decisions more precisely. This is why we are accelerating AI deployment across the enterprise and establishing AI partnerships.

Stepping back, we believe a more connected Danaher with a stronger focus on commercial excellence, innovation and talent can be a stronger Danaher. We intend to bring the best of Danaher to our customers to better leverage our talent, platforms and brand and simplify how we operate, so our teams can focus on the opportunities that matter most. Together, these actions could help us move faster and more fully realize the potential of our portfolio.

So I am incredibly excited about what lies ahead. We are starting from a position of strength with meaningful room to deliver more. That will take time, and we know credibility will be earned through results. Our focus now is making clear choices about where we invest and executing with greater speed and consistency. We believe that can accelerate profitable growth, drive share gains, and most importantly, help our customers improve outcomes for patients around the world.

With that, let me turn to our third quarter results. Our third quarter came in ahead of our expectations on both the top and bottom line with Biotechnology, Life Sciences and Diagnostics core revenue, excluding respiratory revenue, all growing mid-single digits or better. Core revenue growth, excluding respiratory revenue improved to 5.5%, and we delivered a nearly 30% adjusted operating profit margin. These results reflect both improved end market conditions and the benefit of strong commercial and operational execution across the portfolio.

We're particularly encouraged by the improved momentum we saw across our businesses. Underlying demand across large pharma and biopharma remain robust. Biotech activity continued to strengthen and while academic demand remained below historic levels, demand improved sequentially, meanwhile, clinical and applied end markets remain healthy and continued to perform well.

Having spent considerable time with our teams over the past several weeks, I've seen firsthand talent, innovation and customer focus that make Danaher unique. Let me walk you through a few notable examples from across Danaher this quarter.

During a recent visit, Cytiva site in Upsala, Sweden, I have the opportunity to spend time with the teams developing and manufacturing some of our industry-leading products. Seeing firsthand the depth of science and engineering behind these technologies reinforce my confidence in our competitive position. I was particularly impressed by the process development team and how closely that team works side-by-side with customers to solve their most difficult challenges. That partnership has long been important and traditional monoclonal antibodies and it becomes even more valuable as our customers move towards more complex molecules and modalities.

We're bringing innovation and process expertise to help customers solve those challenges. And importantly, we're seeing that differentiated approach help us win more specifications with customers.

Next, we recently announced our first AI-powered autonomous lab. Based on Abcam, this lab brings together AI, robotics and technologies from across our portfolio, including Cytiva, Beckman Coulter Life Sciences, gene data, IDT and molecular devices to offer connected design, make and test workflow. By continuously learning from each experiment, the platform designed to help researchers move from idea to validated reagent up to 8x faster while generating up to 10x higher volume compared to existing models, helping accelerate scientific discovery while providing the rigorous quality and reproducibility required to advance AI-driven drug discovery.

Our partnership with NVIDIA, announced last week, will further advance this vision by connecting our instruments and workflows with NVIDIA's capabilities to help shape autonomous science for our customers.

On the capital allocation front, Leica Biosystems closed the acquisition of StatLab in early Q4. StatLab strengthens Leica's value proposition by enabling a more complete pathology workflow, while advancing our integrated delivery network strategy and helping clinicians diagnose cancer faster and more precisely. We're very pleased to welcome the StatLab team to Danaher.

Finally, Masimo, our other recent acquisition, continued to track ahead of our initial expectations and delivered another quarter of high single-digit revenue growth. Having spent time with the team just last week, the integration is progressing well across the business with a healthy funnel of cost savings and commercial synergy opportunities.

The team has also continued to innovate at an impressive pace recently receiving FDA clearance for its Smartset platform that can help detect atrial fibrillation, a common heart rhythm disorder that often goes undetected and significantly increases the risk of stroke. This technology can help patients earlier who may benefit from further medical evaluation and care. I want to congratulate the Masimo team for their sixth FDA clearance this year and for extending the value of their technology beyond monitoring to help detect important clinical conditions like atrial fibrillation.

And with that, I'll turn the call over to Matt, who will walk you through our Q3 results and guidance in more detail.

Matthew Gugino

Thanks, Julie, and good morning, everyone. As Julie stated, we delivered a solid third quarter with better-than-expected growth, earnings and cash flow. Sales were $6.6 billion and core growth, excluding respiratory revenue, was up 5.5%, and encouraging 100 basis points acceleration from the second quarter and a continuation of the improvement we've seen throughout the year.

Respiratory revenue, while slightly better than expected, represented an approximately 250 basis point headwind in the quarter, resulting in core revenue growth of 3%. Geographically, core revenues in developed markets were flat. Western Europe grew mid-single digits and North America was down low single digits, primarily driven by lower respiratory revenue.

Core revenues in high-growth markets increased approximately 10% with healthy growth across all major regions. China was up high single digits, with growth in all three of our segments. Biotechnology and Life Sciences were supported by healthier funding and investment levels, and Diagnostics continue to move beyond the most significant impacts of China's health care policy changes.

Our gross profit margin for the third quarter was 58.5%. Our adjusted operating profit margin of 29% was up 110 basis points and exceeded expectations, driven primarily by strong operational execution with a modest benefit from tariff refunds received during the quarter.

Adjusted diluted net earnings per common share of $2.11 were up approximately 11.5%. We generated $1.6 billion of free cash flow in the quarter and $4 billion in the first 3 quarters of the year, resulting in a year-to-date free cash flow to net income conversion ratio of 128%, further underwriting the differentiated quality of our earnings.

Now turning towards our business segments. Core revenue in our Biotechnology segment increased 5%. Core revenue in Discovery and Medical decreased low single digits with solid growth in protein research instrumentation more than offset by timing in lab consumables. Core revenue in bioprocessing grew towards the upper end of mid-single digits, modestly better than our expectations. Consumables were up mid-single digits, led by upstream consumables, while equipment increased low single digits.

Orders grew mid-teens in the quarter with particular strength in both upstream consumables as well as There's no change to our full year expectation of mid-single-digit core revenue growth for bioprocessing. Demand trends remain healthy across the business supported by strong commercial production activity and a robust pipeline of new programs. These underlying market trends combined with Cytiva's differentiated portfolio, deep scientific expertise and recent innovations reinforce our confidence in the business' ability to deliver sustainable, high single-digit long-term revenue growth while helping customers improve yields, increased manufacturing efficiency and scale new therapies.

Now turning to our Life Sciences segment. Core revenue increased 4.5%. Core revenue in Pall's applied filtration business increased mid-single digits driven by continued robust growth in aerospace and microelectronics. Core revenue in our Life Sciences instruments businesses increased mid-single digits in the quarter. SCIEX led the way with strong demand from pharma and biopharma customers, a modest improvement in U.S. academic spending and continued momentum for new products, such as ZenoTOF 8600. Beckman Coulter Life Sciences also delivered strong results, including in automation where the team has seen increased demand for AI-enabled solutions and services.

Core revenue in our Life Sciences consumables businesses collectively grew low single digits in the quarter, driven by continued momentum in IDT's MRD and next-generation sequencing product lines while Abcam saw improved academic demand and solid traction from pharma and biopharma commercial initiatives.

Now moving to our Diagnostics segment. Core revenue growth, excluding respiratory revenue was up 7%. Respiratory revenue was an approximately 650 basis point headwind in the quarter, resulting in core revenue growth of 50 basis points. Core revenue in our Clinical Diagnostics businesses increased mid-single digits in the quarter. We saw notable performance at Leica Biosystems with particular strong momentum in digital pathology as well as advanced

Beckman Coulter Diagnostics also delivered its highest core growth quarter in North in 2 years. The traction we saw from new product introductions, including the DxI 9000, together with easing China policy-related headwinds reinforces our confidence in Beckman's competitive position and ability to accelerate their growth trajectory.

In Molecular Diagnostics, core revenue in Cepheid's nonrespiratory business increased low double digits led by growth in Group A Strep, virology and sexual health assays.

Respiratory revenue was approximately $350 million in the third quarter, down year-over-year due primarily to lower global infection rates but modestly ahead of our expectations as we saw customers purchase ahead of the upcoming respiratory season.

Now let's turn to our fourth quarter and full year 2026 outlook and give you an initial perspective on how we're thinking about 2027. In the fourth quarter, we expect core revenue growth, excluding respiratory revenue to be in the 4% to 5% range. We expect respiratory revenue to be an approximately 150 basis point headwind. Additionally, we expect the fourth quarter adjusted operating profit margin of approximately 29.5%.

For the full year 2026, we are increasing our full year adjusted diluted net EPS guidance to $8.57 to $8.62 versus our prior range of $8.45 to $8.60. This reflects the benefit of our third quarter outperformance and represents double-digit year-over-year EPS growth.

Now turning to 2027. While it's still too early to provide a formal outlook, we want to give you some perspective on how we're thinking about core growth next year. We're encouraged by the improvement in the end markets and the growth we've delivered throughout 2026. Excluding respiratory revenue, core revenue growth has averaged 4% to 5% over the past several quarters.

So as we look to 2027, we think that 4% to 5% core revenue growth, excluding respiratory revenue is the right starting point as we sit today. We'll provide a more quantitative and detailed guidance outlook in January, but hopefully, this gives you a helpful starting point for how we're thinking about next year.

With that, I'll turn the call back over to Julie.

Julie Montgomery

Thanks, Matt. So to wrap up, we're pleased to deliver better-than-expected third quarter results and encouraged by the improving growth trends we saw across the business. As I reflect on my first few weeks as CEO -- where I spent time with our teams and customers has only strengthened my conviction and the solid foundation Danaher has built.

My focus now is simple, create more value for customers, accelerate innovation, attract and develop great talent and deploy capital in ways that strengthens Danaher for the long term. These priorities are designed to drive faster and more durable core growth deliver unambiguous share gains and more fully translate the strength of our portfolio into differentiated performance.

While realizing the full potential of these opportunities will take time, I am confident that with DBS as our foundation, we're uniquely positioned to turn those opportunities into results for our customers and the patients they serve, our associates and our shareholders. I'm excited about what we can accomplish together and the results we can deliver as we continue building an even stronger Danaher.

So with that, I'll turn the call back over to Rachel.

Rachel Vatnsdal Olson

Thanks, Julie. That concludes our formal comments. We're now ready for questions.

Operator

[Operator Instructions] Our first question will come from Doug Schenkel with UBS.

질의응답

Unknown Analyst

Julie, welcome to the call. So as the new CEO, you're new to the role, but as we all know, you are certainly not new to Danaher. So recognizing that and also that this has been a challenging period for the company, but also that Danaher has a legacy of operational excellence and solid capital deployment, how are you balancing the legacy of a company that has business school case study is written about its strategy and execution versus the opportunity and need to make change? Essentially, as you sit here today, what's foundational? And how do you think about evolving the playbook?

Julie Montgomery

Thank you for the thoughtful question. Danaher is a great company and one I am incredibly proud to lead. And we have a great heritage with HBS case studies written about us. And I know exactly what you are referring to as I read that case study when I decided to join Danaher 9 years ago.

We also have truly unique differentiators that continue to serve us well today. Exceptional talent, a great portfolio and a continuous improvement culture supported by a business system that is unparalleled. At the same time, as I said in my prepared remarks, we have an opportunity to grow at a higher rate than we have in recent years. And when I talk to our teams, I'd say the unambiguous share gain is our true report card. So I want to preserve what makes us great, but also ensure we are focused on the most important priorities for who we are today.

So let me break that down a bit. You heard me talk about becoming a more connected Danaher. When that Harvard case study was written, our businesses were lower growth markets and our customers typically brought from a single operating company. We are in a very different situation today. Higher-growth scientific markets with the same customers buying across 3, 6, 12 operating companies. So we will keep the advantages of our operating company structure in place. I think of that as the accountability, the customer and technical intimacy and the unique development opportunities for our people. But we will also work in a more connected way that makes it easier for customers to access the full power of Danaher.

I still talk to customers who are surprised to learn that company XYZ is part of Danaher, and yet we are a strategic partner to those customers. These customers are inevitably interested in a broader conversation that can lead to higher share of wallet for us and better solutions for the customer.

In the same thinking, ensuring we are focused on what matters most for the company we are today extends to our other priorities. You heard me say we will focus more on commercial excellence. Now that we are in a growthier markets, more leadership focus on commercial prowess leads to more value creation.

I also spoke about strategy-led innovation. This is important because our markets today are fueled by scientific discovery. And as a result, we need to know where the puck is going and to make focused higher impact investments.

In talent, for this age in these markets, we need to develop and attract the best AI science technology and operating talent to innovate at the speed of life. And we will want to continue to focus on capital allocation while ensuring we do so in strategically compounding ways to help the flywheel of our businesses turn better and faster.

So what you hear me saying is, I don't view these priorities as a generic playbook, but as what best enables us to become that defining leader now that we are a fully scaled life sciences and diagnostics company.

Unknown Analyst

One follow-up on your prepared remarks from earlier on the call. You outlined several priorities. What's the biggest one that you expect to have the greatest impact over the near term, say, over the next 12 to 18 months? And what operating or financial metrics should investors use to assess progress pursuant to that top priority?

Julie Montgomery

Sure. Step one is really prioritizing and aligning our teams around accelerated profitable growth and unambiguous share gain as the report card, and that's what our investors should be looking for. And that leads to a clear near-term opportunity to further drive commercial excellence across the enterprise. This means being super clear on simple but powerful expectations for our sales team and what leaders will drive and inspect. And frankly, this is where DBS creates a real advantage for us.

What will then further accelerate this is when we consistently go up as a more connected Danaher. There are pockets across the business where this is working extremely well. I mentioned, we've seen a lot of success with this in diagnostics where we started to speak to customers as diagnostic solutions in addition to individual operating companies and this has led to much more senior and strategic dialogues and value propositions that have created several hundred millions of dollars of opportunity in a short time.

We are also seeing this in our life sciences approach to the new tech bias, and we have approached these AI-native drug development companies this way from the start, and I really like the traction we are seeing. And one of the things I've been pleased to learn over the course of my transition to CEO is that when I talk to customers across all three of our platforms, they want to see more of this from us. So these changes will take some time, but our report card is higher core growth, profitable core growth, an unambiguous share gain.

Operator

Our next question will come from Vijay Kumar with Evercore ISI.

Vijay Kumar

Julie, congratulations to you. I guess my first question, Matt, I think you made some helpful comments here on the fiscal '27 framework. Curious, when I look at your bioprocessing segments came in quite solid year in 3Q, and you have a few moving pieces in '27. Instrument orders have been quite solid year-to-date. You could see some activity from onshoring. You do have a catch-up from this order push out in consumables. So I'm curious, should bioprocessing be pushing very high singles, low double digits when you think about fiscal '27?

Matthew Gugino

Yes. Vijay, thanks for the question here. So I think just to start with bioprocessing here for '26 and how we feel like we're going to finish the year. So -- no change to our full year expectations for 2026 for bioprocessing, mid-single-digit core growth. We saw Q3 was actually a bit better than we expected the upper end of that mid-single-digit range. And -- from an orders perspective, they remain strong, mid-teens order growth that was led by upstream consumables as well as resin. So given order trends and those order trends that we're seeing, we'd expect to see bioprocessing growth rates continue to improve in 2027.

We gave that overall Danaher outlook of 4% to 5% core growth ex respiratory as we want to get through our planning processes and as we'll do with the rest of our businesses, we want to see how Q4 shapes up here before we provide more formal guidance, whether it's around bioprocessing or the other segments here. But all in, good to see the order trajectory view bioprocessing long term is a high single-digit growth business and encouraged by what we're seeing.

Julie Montgomery

And Vijay, I can add a little bit of color here because as you would imagine, this is a place where I spent quite a bit of time recently both with the team and with customers. And my conclusion is we have a differentiated portfolio with the most comprehensive offering in bioprocessing. And this really positions us to win with virtually any customer across nearly every step of the workflow.

We like the secular drivers. There's a record number of monoclonal antibodies coming to market, the acceleration of biosimilars in newer modalities like the antibody drug conjugate, cell therapy, the by trispecifics are adding to the volume and, of course, the reassuring opportunity. And as I meet with customers, it is clear they value us as a critical partner and not just a supplier. They bring to us their most critical problems, and we are very good at solving them. So all in, very confident that bioprocessing is a high single-digit business here over the long term, as Matt said.

Vijay Kumar

That's helpful, Julie. And maybe one for you on capital deployment. I'd love to hear your view of this on capital deployment. You come from Diagnostics. We've seen a couple of acquisitions within the segment. How are you thinking of M&A opportunities and areas of interest for Danaher? And the reason I ask on areas of interest is, in Masimo, is that kind of signaling a more meta turn, if you will? Or how are you thinking of areas of priorities?

Julie Montgomery

Yes. Thanks, Vijay. M&A remains our bias for capital allocation as we think it's the best way to compound returns over the long term. And we're going to continue to look for strategically compounding M&A. And of course, we'll keep a robust investment criteria that has served us well for decades. And we see Masimo and just recently here StatLab, as good examples of this. And I see opportunities to strengthen all three of our platforms, both organically and inorganically through M&A.

You talk about Masimo. I actually don't see that as a med tech M&A play. I see it as a continuous diagnostic that is strategically compounding with our Diagnostics business. We already see the commercial synergies at work, and we're able to have scientific conversations around how the combination of continuous monitoring and biomarkers can lead to better outcomes for patients. So just another example of something that we view as strategically compounding, there's certainly no bias here to medtech.

Operator

Our next question comes from Tycho Peterson with Jefferies.

Tycho Peterson

Matt, I want to stress test the assumptions you kind of put out for next year, the 4% to 5%. I have a lot of people asking why you're not kind of accelerating here. I appreciate your comments on bioproduction a minute ago. You had the order residues, obviously in biotech that should come through. You don't have the China VBP headwinds. You've got recovery in biotech, academic picking up a bit. So why on earth would respiratory be the same? I think you kind of alluded to the fact you just want to see how 4Q shapes up and 4% to 5% is maybe a floor, but maybe get us comfortable there's something that you're not baking in that's getting worse.

Julie Montgomery

Tycho, this is Julie, of course. So as Matt discussed, we've delivered core growth ex respiratory in the 4% to 5% range the last few quarters. And so we think that's a reasonable starting point for 2027 based on the current in market conditions. I'm only a few weeks into the CEO role, but the time I spent with our teams and customers, and certainly reinforced my confidence in our positioning and the improving in markets, but we really want to work through our typical planning process here that we go through in Q4, and then we will provide you a more quantitative outlook in January.

Tycho Peterson

Okay. And then follow-up, Julie, on Diagnostics, on Respiratory, you guys did a good job walking down expectations for Respiratory this year, understand weak flu season overall, but why another $100 million cut when the data is starting to turn here, 3Q came in above. Is that conservatism? Or are you seeing something in the data that leads to the cut here? And then as we think about '27, we have a lot of questions about the endemic rate. Is $1.5 billion the right way to think about it? Or how do you think about the new endemic rate?

Julie Montgomery

Yes. Tycho, we are planning for $1.5 billion in Respiratory this year. And I think that's also the right starting point for next year as well. And really, what I want to do here is to create an expectation for a down the middle of the road flu season. And as you know, there is variability in flu seasons year-to-year season. And yes, that can create a couple hundred million dollars of bookings around that number. What we're seeing in Q4, it sounds like you follow it. As you know, we've been lower than last year. almost every week this year. There's been just this little bit of a tick up recently, but we think that's way too early to call. .

And you really can't say much about the flu season until you see the ILI curve tick above 3%, and then you're sort of officially in the season. And that doesn't typically happen to late November, early December after everyone's enjoyed some Thanksgiving Turkey. So at this point, we think it's prudent just to call what we now see is that more typical down the road flu season.

Operator

Our next question will come from Jack Meehan with Research.

Jack Meehan

Julie, I wanted to pull you a little bit more on your views on AI. I appreciate all the emphasis that got in your opening remarks. Just would love to hear from you now that you're in the CEO seat, just how you think about the implications for Danaher? Any updates you can share around how you're deploying it with DBS?

Julie Montgomery

Sure. Yes. So thanks for the question. We see AI-driven Doug discovery as a significant long-term opportunity for us. And in my view, it will clearly make the world a healthier place, which is incredibly exciting. And we believe that Danaher is uniquely positioned to help shape this market, frankly, because we have all of the building blocks.

Our breadth, as Danaher has always been a competitive advantage for us. But even more so, I believe that will be the case in the age of AI. So we have all five pieces of the equation needed. We have the instruments, think about molecular devices, SCIEX, Leica Micro. We have the consumables, IDT, Abcam. We have the automation, Beck LS, our Automata partnership. We have the software and gene data and IDBS. And lastly, we have the scale that makes us a priority for the Frontier Labs.

So while it's not material today, we have started to see a modest benefit to our orders and revenue. And frankly, it's at the forefront of every customer conversation I have in Life Science. And it's our ambition to be a leading partner as our customers adopt AI. And we believe the full power of our platform positions us exceptionally well to use AI to help accelerate scientific discovery. And of course, we're also using it internally. I think that DBS and AI have a really natural synergy. As a company culturally, we excel at thinking about processes and identifying the critical path in that process. And that enables us to focus AI on where it's going to create the most value for us. And then we have the ability to follow that up with strong KPIs and daily management. I think that's going to be a really powerful combination as we roll out AI here.

Jack Meehan

Excellent. And then maybe just it would be great to double-click a little bit from the announcements that have come out related to AI, whether it's with NVIDIA or the autonomous lab Abcam. Just like what's the bigger strategy here? Is there a potential to broaden some of these things across the organization?

Julie Montgomery

Sure. Yes, we were very excited to announce our plans for our first AI-powered autonomous lab and that brings together AI, robotics and technologies from across Danaher into an integrated continuous learning workflow. So the simplest way to think about this is that we are working to connect AI to the physical experiment. Lots of organizations can ask AI what their next experiment should be. I still remember the first time I saw that work, it was amazing, but we can do more. Our autonomous lab has AI designed the experiment. And then our technology makes the reagents and test those reagents and then the results be the next experiment. So this creates a full design, make, test closed loop, which is leading to 8x faster discovery of reagents in a 10x productivity enhancement.

And the autonomous lab, that's something that we are starting here within Danaher. We've gotten a lot of customer interest in it and customers even going to see that at work at our Abcam facility. So we want to demonstrate that we can do it in Danaher and then work with our customers.

The NVIDIA collaboration is also something we recently announced. And there, we're collaborating with NVIDIA to help accelerate the adoption of AI and scientific research and drug discovery. And the goal is to combine our instruments, automation and software with NVIDIA's AI and advanced computing technologies. So this means more intelligent instruments in automated lab workflows via edge computing, and it means exploring AI models and digital twins to simulate and optimize experiments before running them. So a lot of work underway here with NVIDIA, and we're excited to build on the collaboration over time.

And frankly, we're also working with Entropic, and you probably saw some of the model hardware standards that were part of their research preview program. And this is about making our instruments easier to connect to other agents and other instruments. So we think that's an important part of utilizing the value of our breadth.

Operator

Our next question will come from Scott Davis with Melius Research.

Scott Davis

Julie, I wanted to dig into this commercial execution just a little bit because you're -- it sounds easy, and I'm sure it's incredibly difficult. So -- what do you -- what's the first step? Do you have to change compensation schemes? Do you have to change out people? I mean what -- how do you really drive? i mean, I'm sure Rainer cared about commercial execution. So how do you really drive change at the pace that you want to drive? Do you have to change, I think, some processes and structure around that to get there?

Julie Montgomery

Yes. Thanks for the thoughtful question. There's a couple of steps here. One, in terms of commercial execution, I am a fanatic on what we referred to at Danaher as the commercial standard condition. And this is really taking DBS down to a very simple place and being extremely clear about what we expect from our sales teams. And we've really doubled down on that in Diagnostics. And the other platforms have taken that as some inspiration and have been holding workshops to make sure that we are doing the same. And one of the things that's interesting is we're even experimenting with how AI can make how we coach and inspect our sales results even simpler, which I think is a really exciting opportunity for us.

And then when it comes to this more connected selling process, it's both easy and difficult. And I think that it's easy when you kind of get the incentives right and you touched on that. When we first started doing this in Diagnostics, one of our rules is when we have a solutions group team go out and talk to customers, no one's incentives are ever hurt. And frankly, the opportunity is clear enough here that I'm happy to double pay on incentives because as you're using the power of Danaher to increase our share of wallet with customers, there's significant win-win opportunities there to go after. Thanks for the question.

Scott Davis

No, thanks for the answer and high integrity of that answer. But I'm going to ask the same exact question around M&A because clearly, there's -- Danaher's 50-year history, there's a long history of very successful M&A, and there's been a few stinkers in there, obviously, that have impacted your portfolio of late. But how do you change? I mean what -- do you feel the need to change the process? And again, I was asking kind of the same way, process over the people, do you change kind of how you work the funnel? I mean, how do you drive to that lower risk, higher consistency, higher return kind of mandate and still put capital to work because I think other companies go through the stages and they kind of freeze. They become afraid to do deals because they're afraid to make a mistake. So how do you keep that flywheel moving so that you're putting capital to work, but increase your hit rate from here?

Julie Montgomery

Yes. No, thank you for the question. We certainly don't want to freeze capital allocation remains a priority for us. And frankly, we have great processes and great teams for M&A. So you mentioned some that hasn't performed as well in the recent past. And I think as a company, we have learned from that. But our focus is really just ensuring that we're doing strategically compounding M&A with a robust return profile. And if you look at our recent deals, obviously, it's early days. But I think that they will be strong returns for us and strategically compounding.

Operator

Our next question will come from Casey Woodring with JPMorgan.

Casey Woodring

Julie, looking forward to working with you. Maybe a follow-up to an earlier question, but just on Masimo, you talked a little bit about how you view the business fitting into Danaher, and you obviously led that deal as head of Diagnostics. But maybe can you just walk through the current trends you're seeing in that business and how we should think about Masimo contribution next year?

Julie Montgomery

Yes. Thank you for the question. Masimo is off to a great start. They delivered high single digits here in Q3, the first full quarter as part of Danaher and year-to-date as well. And I was just with the team last week, the integration is progressing extremely well. They've already completed in our sustainment for over 10 Kaizens with more planned along the way. And frankly, it's just tremendously rewarding to work with that team and see them get excited about DBS, how the lean thinking can support a better cost position, better on-time delivery for the customers. And then also, we have a healthy funnel of the commercial synergies that we were anticipating.

And in true Danaher fashion, we will also learn from Masimo. We're extremely impressed by their rate of innovation and some of their commercial techniques as well. And that's always been part of what makes Danaher stronger.

Casey Woodring

Understood. That's helpful. And then maybe as a follow-up, you called out mid-teens order growth in bioprocessing. If you could maybe just double-click on the equipment piece of that order growth maybe parse out how much pent-up demand you're seeing over the last several quarters. And then I would also be curious to hear on reshoring as well, kind of what you're seeing from an order perspective there and how reshoring could potentially contribute to growth in '27?

Matthew Gugino

Sure, Casey, I'll take the order growth part of the question and then kick it over to Julie for reshoring. So another quarter of mid-teens order growth overall in bioprocessing that was led by upstream consumables as well as resins, encouraged by those trends continue to build backlog here. And although when you think about equipment versus consumable orders year-to-date, both up nicely with those equipment orders continuing in that strong double-digit range. So really supportive of those improving on end market and underlying trends of the business.

Julie Montgomery

Yes. And Casey, on reshoring, I mean, reshoring is playing out largely as we expected. We're seeing some brownfield activity today, and that has a modest impact to our order book at the moment. Those larger greenfield projects are still in the planning phases. The funnel including activity is beginning to pick up, but we see that as more of a 2028-plus event in terms of when it starts to hit the P&L. We think -- we do think this is a strong opportunity ultimately for the business. And it could be a $1 billion market opportunity in the U.S. But as I said, we'll expect it to play out across several years, mostly starting in 2028.

Operator

Our last question will come from Evie Koslosky with Goldman Sachs.

Elizabeth Koslosky

Julie, congrats on the new role. So within Life Sciences, maybe walk through the key end markets of where we are in the recovery within academic? And then biotech specifically with an emerging biotech and then also within industrial and semis? And then are you hearing from customers in terms of where they are with spending versus kind of where we still have room in the recovery? And any areas that investors should look for potential acceleration and leverage for upside into next year?

Julie Montgomery

Great. Thank you, Evie, for the question. So you saw here in Q3, we grew 4.5%, and finished above our expectations driven by the improving end markets and the traction of some recent commercial initiatives as well as some new product launches. And frankly, this is the third quarter in a row where Life Sciences has beat our internal expectations.

The end markets continue to steadily improve. Large pharma and biopharma remained robust. Biotech funding is reading through academic demand still below historic levels, but improved modestly sequentially. And we saw continued strength in clinical and applied markets, including in MicroE at Pall. And our customers, they are really interested, and we're starting to see some of that early demand for the AI-driven workflow solutions. And that's first starting to show up in automation, Beckman Life Sciences. And as I mentioned, I think we're very well positioned here in AI. Customers like the breadth of our portfolio. and we will turn that into a value proposition for them that's around ease of integration through common standards across the instruments.

Operator

We've now reached our allotted time for questions. And I'd like to turn the call back over to Rachel for any additional or closing remarks.

Rachel Vatnsdal Olson

Perfect. Thank you, operator. Thank you, everyone, for joining us today this morning. We'll be around the rest of the day and the week for follow-ups if any of you have questions. Thank you.

Operator

Thank you, ladies and gentlemen. This brings us to the end of today's meeting. We appreciate your time and participation, and you may now disconnect.