Bio-Rad Q3 Revenue Flat as Charges Push GAAP Margin Negative

Bio-Rad (BIO) reported largely flat third-quarter revenue as growth in Clinical Diagnostics offset a decline in Life Science, while restructuring and impairment charges pushed its GAAP operating margin into negative territory. The company also projected full-year 2026 currency-neutral revenue ranging from a 3.0% decline to 0.5% growth.

Revenue for the quarter ended September 30, 2026, was $656 million, up 0.5% as reported and 0.7% on a currency-neutral basis from a year earlier. Clinical Diagnostics generated 61% of total revenue, with Life Science accounting for the remaining 39%.

GAAP gross margin fell 250 basis points year over year to 50.1%. GAAP operating margin was negative 7.6%, down 1,760 basis points, reflecting approximately $77 million of restructuring charges and a roughly $50 million non-cash impairment charge related to purchased intangible assets. Bio-Rad attributed the impairment to the discontinuation and reprioritization of certain research and development programs.

Excluding specified items, non-GAAP gross margin increased 100 basis points to 54.5%, while non-GAAP operating margin also rose 100 basis points to 12.8%.

Net cash from operations totaled $96 million, down $25 million year over year. Free cash flow, defined by the company as operating cash flow excluding net capital expenditures, declined by $24 million to $65 million.

Diagnostics Growth Offsets Life Science Decline

Life Science revenue fell 2.8% to $255 million, or 2.4% on a currency-neutral basis. Lower sales in the Americas outweighed gains in Europe, the Middle East and Africa and in Asia-Pacific.

The segment’s performance was affected by Process Chromatography. Excluding that business, Life Science revenue increased 2.5% on a currency-neutral basis. Bio-Rad’s Droplet Digital PCR franchise grew 7%, including an increase of more than 20% in instrument revenue.

During the quarter, the company launched its ChemiDoc Pro imaging system and expanded its Foresight Pro pre-packed column offering to include Nuvia resins.

Clinical Diagnostics revenue rose 2.7% to $402 million and increased 2.8% in currency-neutral terms. Sales grew in the Americas and Asia-Pacific, partly offset by a decline in EMEA. Quality systems and diabetes products led the segment’s growth.

Geographically, the Americas contributed 45% of companywide revenue, EMEA accounted for 34% and Asia-Pacific represented 21%.

Full-Year Outlook

For full-year 2026, Bio-Rad expects currency-neutral revenue growth between negative 3.0% and positive 0.5%. The company projects Life Science currency-neutral revenue between a 3.0% decline and 1.0% growth, while Clinical Diagnostics revenue is expected to decrease between 1.0% and 3.0% on the same basis.

Management forecasts a non-GAAP gross margin of 53.0% to 54.0% and a non-GAAP operating margin of 10.0% to 12.0%. Full-year free cash flow is expected to range from $290 million to $340 million.

Bio-Rad did not provide reconciliations of its non-GAAP outlook to comparable GAAP measures because the timing and size of potential restructuring, impairment, acquisition-related, legal and portfolio-rationalization charges, among other items, cannot be reasonably predicted. The forecasted non-GAAP operating margin excludes 83 basis points associated with amortization of purchased intangible assets.

At September 30, Bio-Rad held $5.85 billion in cash and short-term investments, up from $5.67 billion at the end of 2025. Net inventories increased to $784 million from $741 million, while long-term debt, including current maturities, rose to $1.66 billion from $1.54 billion. Its investment in Sartorius AG was valued at $1.20 billion, little changed from year-end.