Danaher Corporation
DHR · NYSE
Next quarter
Reports Oct 20, 2026.
Consensus is $1.96 EPS for Sep 2026 across 9 estimates, ranging $1.91 to $2.10.
DHR Jun 2026
- 5.43%
- +0.07%
- $1.84
- $1.94
- —
- $6.26B
Reported results
- $6.26B
- 57.64%
- $1.13B
- 17.99%
- $870.00M
- $1.23
Highlights
- Adjusted EPS: Non-GAAP adjusted diluted EPS was $1.94, up 8.0% year over year and 5.43% above the $1.84 consensus.
- Revenue: Sales increased 5.5% year over year to $6.265 billion, versus $5.936 billion in Q2 2025 and $5.95 billion in Q1 2026.
- Underlying growth: Core revenue increased 3.0%, or 4.5% excluding respiratory testing; growth improved from the first quarter as high-growth-market sales rose 15% and core sales increased by more than 10%.
- Life Sciences: Core revenue grew 5.5%, the strongest segment performance, led by filtration and higher demand for instruments and consumables; operating profit was $244 million versus a $239 million loss a year earlier.
- Biotechnology: Revenue grew 4.0% to $1.920 billion and core revenue rose 2.5%; bioprocessing orders grew in the mid-teens despite shipment timing pushing some customer projects out of the quarter.
- Diagnostics and Masimo: Diagnostics revenue rose 7.0% to $2.466 billion, including a 4.0% acquisition contribution from Masimo, but operating margin fell to 16.9% from 24.0% because of acquisition-related costs and incremental amortization.
- Cash generation: Operating cash flow was $1.534 billion and free cash flow was $1.265 billion in the quarter; first-half operating cash flow reached $2.856 billion and free cash flow $2.350 billion.
- Masimo financing: Danaher completed the $9.8 billion Masimo acquisition on June 10, funded with cash and new debt; total debt rose to $26.558 billion from $18.418 billion at year-end 2025.
- Guidance: Full-year adjusted EPS guidance increased to $8.45-$8.60 from $8.35-$8.55, while full-year core revenue growth remains 3.0%-4.0%; Q3 core growth is expected at 2.0%-3.0%.
Analysis
Danaher delivered a better-than-expected second quarter, with adjusted EPS of $1.94 versus the $1.84 consensus, while revenue reached $6.265 billion, up 5.5% year over year and 5.3% sequentially from $5.95 billion. Adjusted EPS rose 8.0% from $1.80 in Q2 2025, although GAAP diluted EPS of $1.23 was below Q1's $1.45 as net earnings fell to $870 million from $1.03 billion sequentially. Year-over-year GAAP comparisons were lifted by the absence of the $432 million Life Sciences impairment recorded in Q2 2025.
The print was chiefly about improving underlying demand and the initial ownership of Masimo. Company core growth accelerated to 3.0%, or 4.5% excluding respiratory testing, with Life Sciences delivering 5.5% core growth and Biotechnology benefiting from stronger consumables demand and mid-teens bioprocessing orders. Masimo added 1.5% to company sales growth but pressured Diagnostics profitability through $108 million of acquisition-related items and higher amortization. Danaher also generated $1.265 billion of free cash flow, but funded the $9.8 billion acquisition with substantial new borrowing. Management raised full-year adjusted EPS guidance to $8.45-$8.60 while maintaining 3.0%-4.0% core revenue growth.
Underlying growth recovery
Danaher’s reported sales growth benefited from acquisitions and currency, but the more important signal was the improvement in organic demand. Core revenue rose 3.0% year over year, compared with 4.5% growth excluding respiratory testing, as the company moved further beyond the difficult biotechnology and diagnostics comparisons of prior periods.
- High-growth markets: Sales increased 15% year over year and core sales rose by more than 10%; these markets represented approximately 31% of company revenue.
- Respiratory testing: Respiratory revenue was approximately $250 million in the quarter versus $300 million a year earlier, creating a 1.5 percentage-point headwind to company core growth.
- Margins: GAAP operating margin expanded to 18.0% from 12.8% year over year, but the comparison benefited by 730 basis points from the prior-year impairment. Q2 2026 Masimo-related charges reduced the comparison by 175 basis points.
Segment performance
Life Sciences was the clearest positive surprise within the portfolio, while Biotechnology showed improving but still moderate growth. Diagnostics grew on the Masimo contribution and stronger non-respiratory demand, but its underlying six-month performance remained affected by respiratory testing and China pricing.
- Life Sciences: Revenue increased 5.5% to $1.879 billion and core revenue grew 5.5%. Filtration led growth, supported by microelectronics and energy demand, while instruments benefited from flow cytometry, lab automation, mass spectrometry and microscopy.
- Biotechnology: Revenue rose 4.0% to $1.920 billion, with core revenue up 2.5%. Bioprocessing core growth was low-single digit as improved consumables demand offset project shipments moved out of the quarter; management said orders grew mid-teens.
- Diagnostics: Revenue increased 7.0% to $2.466 billion, but core growth was 2.0%, or 5.0% excluding respiratory testing. Operating profit declined to $416 million from $554 million and margin fell 710 basis points to 16.9%.
Masimo integration
Danaher closed the Masimo acquisition on June 10 for approximately $9.8 billion, or $180 per share, bringing monitoring technologies, sensors and patient monitors into Diagnostics. Masimo contributed 1.5% to company sales growth in the quarter and 4.0% to Diagnostics sales growth, but the transaction diluted near-term earnings quality.
- Purchase accounting: Danaher recorded approximately $5.0 billion of preliminary goodwill and $4.844 billion of acquired intangible assets; Diagnostics amortization increased to $81 million from $48 million year over year.
- One-time costs: Second-quarter acquisition-related items totaled $108 million pretax, including inventory fair-value adjustments, transaction costs and pre-acquisition compensation items.
- Balance sheet: Total debt reached $26.558 billion at June 26 versus $18.418 billion at December 31, 2025, while cash was $4.348 billion. Net interest expense was $46 million, up from $63 million of net interest income a year earlier.
Cash flow and capital
Cash generation remained strong despite the acquisition and higher working-capital demands. Danaher used debt and cash to fund Masimo while continuing shareholder returns and maintaining investment in its operating base.
- Quarterly cash flow: Operating cash flow was $1.534 billion, up from $1.338 billion in Q2 2025, and free cash flow was $1.265 billion versus $1.094 billion.
- First-half cash flow: Operating cash flow increased 8.0% to $2.856 billion and free cash flow increased approximately 9.0% to $2.350 billion; capital expenditures were $506 million.
- Shareholder returns: Danaher repurchased 5.0 million shares for $903 million during the first half and declared a quarterly dividend of $0.40 per share.
Outlook and next deal
Management raised the earnings outlook on the strength of the quarter and the earlier-than-expected Masimo closing, while leaving its revenue framework unchanged. The outlook assumes continued end-market recovery but recognizes that Diagnostics will remain uneven as respiratory testing normalizes.
- Third quarter: Core revenue is expected to grow 2.0%-3.0% year over year, with adjusted operating margin around 26.5%. Core growth excluding respiratory testing is expected to be approximately 5.0%.
- Full year: Core revenue growth remains 3.0%-4.0%, while adjusted EPS guidance increased to $8.45-$8.60 from $8.35-$8.55. Management expects to exit 2026 at a mid-single-digit core growth rate.
- StatLab: Leica Biosystems plans to acquire StatLab by year-end 2026. StatLab generated approximately $250 million of 2025 revenue, has more than 85% recurring revenue and is expected to deliver high-single-digit long-term core growth and be EPS-accretive in its first full year.
