Question · Q3 2025
Michael Wriston asked about the factors influencing Danaher's wider 3% to 6% core revenue growth range for fiscal year 2026, specifically what drives the low versus high end. He also inquired about the de-risking of China diagnostics from Volume-Based Procurement (VBP) for 2027, considering concerns about potential future waves in areas like oncology and thyroid.
Answer
Rainer Blair (President and CEO) provided context on Q3 performance and proactive investments for 2026, outlining expectations for biotechnology (high single-digit core growth, flat equipment), life sciences (modest improvement), and diagnostics (accelerated growth post-China policy headwinds, $1.7 billion respiratory revenue). Matt McGrew (EVP and CFO) detailed EPS expectations, anchoring at the low end of the range, anticipating 35-40% fall-through on volume plus cost actions for over 100 basis points of margin expansion. He clarified that $175 million in 2025 cost actions are expected to generate $75 million in net savings for 2026, providing a $0.30 EPS tailwind. Regarding China VBP, Matt McGrew noted they are past the initial wave, expecting a manageable $75 million to $100 million headwind for 2026.
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