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BRUKER CORP (BRKR)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 missed on both revenue and EPS vs S&P Global consensus as academic, biopharma and industrial demand weakened, tariffs rose, and FX turned into a headwind; revenue was $797.4M vs $810.2M consensus and non-GAAP EPS $0.32 vs $0.42 consensus, while GAAP EPS was $0.05 . Consensus values marked with asterisk are from S&P Global: revenue $810.2M*, EPS $0.42*.
  • Bruker cut FY25 guidance to revenue of $3.43–$3.50B (2%–4% reported growth) and non-GAAP EPS of $1.95–$2.05 (down 15%–19% YoY), citing lower organic demand (-2% to -4%), ~60 bps tariff and ~90 bps FX headwinds to margin; management also initiated a larger cost program targeting $100–$120M annual savings in FY26 to drive ~300 bps operating margin expansion even in flat growth .
  • Non-GAAP operating margin fell 480 bps YoY to 9.0% on weaker volume, mix, tariffs and FX; non-GAAP gross margin was 48.6% (-270 bps YoY). Free cash flow was -$148.8M on tax timing and working capital; book-to-bill was mid-0.9x and BSI backlog ~6.5 months .
  • Innovation cadence remained strong (timsUltra AIP, timsOmni, timsMetabo; biocrates acquisition), supporting the medium-term multiomics thesis despite near-term headwinds; Q2 segment mix: CALID strength offset BioSpin softness; BEST declined .
  • Catalysts: clarity on tariff rates (esp. Switzerland), visibility on U.S. NIH/NSF funding settlements, China stimulus timing, execution of cost actions, and potential Q4 UHF NMR recognition; management models Swiss tariffs at 15% and can re-route production if needed .

What Went Well and What Went Wrong

What Went Well

  • Product/innovation momentum: Launched timsUltra AIP with sensitivity gains enabling single-cell and high-throughput proteomics; also highlighted timsOmni and timsMetabo, and announced biocrates metabolomics acquisition to broaden multiomics consumables/software/services .
  • CALID strength and applied MS/diagnostics: First-half CALID revenue up low-teens on MALDI Biotyper and ELITech molecular diagnostics; applied MS grew, offsetting life-science MS softness (management commentary) .
  • Cost discipline and forward margin plan: Announced expanded cost reductions of $100–$120M annualized for FY26; management targets ~300 bps operating margin uplift in FY26 even with muted growth .

What Went Wrong

  • Demand softness and order intake: Organic revenue -7.0%; BSI -7.2% organic; book-to-bill mid-0.9x as U.S. academic, biopharma and industrial markets weakened; Europe and Americas saw low double-digit organic declines; China declined low-single digits .
  • Tariffs and FX headwinds: Q2 margins/EPS impacted by higher tariffs and a decline in USD; CFO quantified ~$0.06 EPS headwind from FX in Q2; FY25 margin guide embeds ~60 bps tariffs and ~90 bps FX headwinds YoY .
  • Free cash flow pressure and working capital: Q2 FCF -$148.8M on sizable tax prepayments ($50–$60M) and working capital; inventories rose to $1.22B vs $1.07B at 12/31/24 .

Financial Results

Key P&L and margins (prior year and prior quarter comparisons):

MetricQ2 2024Q1 2025Q2 2025
Revenue ($M)$800.7 $801.4 $797.4
GAAP Diluted EPS ($)$0.05 $0.11 $0.05
Non-GAAP Diluted EPS ($)$0.52 $0.47 $0.32
Non-GAAP Gross Margin (%)51.3% 51.3% 48.6%
Non-GAAP Operating Margin (%)13.9% 12.7% 9.0%

Q2 2025 vs S&P Global consensus:

MetricConsensus*Actual
Revenue ($M)810.2*797.4
Non-GAAP EPS ($)0.42*0.32

Values with an asterisk (*) are from S&P Global.

Segments and geography:

Segment/RegionQ2 2024 ($M)Q2 2025 ($M)
BioSpin217.5 195.3
CALID265.6 285.8
Nano252.5 252.1
BSI Total735.6 733.2
BEST69.1 66.3
Eliminations(4.0) (2.1)
Total Revenue800.7 797.4
United States243.7 222.9
Europe275.8 272.5
Asia Pacific226.6 242.1
Other54.6 59.9

KPIs and cash flow:

KPIQ2 2024Q2 2025
Book-to-bill (BSI)—Mid-0.9x
BSI backlog (months)—~6.5 months
Free Cash Flow ($M)-$23.5 -$148.8
Cash & Cash Equivalents ($M, end of period)$183.4 (12/31/24) $92.0 (6/30/25)

Non-GAAP adjustments impact (EPS):

  • Q2 2025 total non-GAAP adjustments equated to $0.27 per diluted share; non-GAAP EPS was $0.32 vs GAAP $0.05 .

Guidance Changes

MetricPeriodPrevious Guidance (Q1 2025 ER)Current Guidance (Q2 2025 ER)Change
Revenue ($B)FY 2025$3.48–$3.55B; +3.5%–5.5% reported; CER +2.5%–4.5%; Organic 0%–2%; M&A ~2.5%; FX tailwind ~1% $3.43–$3.50B; +2%–4% reported; CER ~+0.5%; Organic -2% to -4%; M&A ~3.5%; FX tailwind ~2.5% Lowered
Non-GAAP EPS ($)FY 2025$2.40–$2.48 (0%–3% YoY) $1.95–$2.05 (-15% to -19% YoY) Lowered
Operating Margin (YoY delta)FY 2025Not specified~-210 bps YoY; comprised of ~-40 bps M&A, ~-60 bps tariffs, ~-90 bps FX, ~-20 bps organic New detail
Tariff assumptionsFY 2025Reflected in Q1 guide (rates as of Apr 30) EU & Israel 15%, Malaysia 19%, Switzerland modeled at 15%; worst-case Swiss 39% would add ~$10M headwind but would re-route production Updated detail
2026 margin outlookFY 2026Not specified~$100–$120M cost saves targeted to drive ~300 bps operating margin uplift even with flat demand New plan

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
Academic funding (U.S.)FY25 initially guided to double-digit EPS growth; no disruption highlighted in Q4; in Q1, lowered FY25 organic/EPS guide due to academic/tariff dynamics U.S. academic softness material; awaiting NIH/NSF settlements; expects Q3 visibility; 2025 U.S. academia -20% to -25% for Bruker; cautious on FY26 budgets Deteriorated in 1H25; potential stabilization ahead
Biopharma demandQ1: growth in BSI, but noted emerging headwinds in guidance Biopharma U.S. orders “significant” decline; visibility hinges on tariffs and macro clarity Weaker
Industrial marketsQ4/Q1 strong base; FY25 CER growth initially 5%–7% Europe/U.S./China industrial research instruments weaker amid tariff/economic uncertainty Weaker
TariffsQ1: built into guidance (as of Apr 30) Additional headwinds; Swiss tariff modeling at 15% with contingency to shift builds; ~60 bps FY25 margin headwind Headwind intensified
FXQ1: modest tailwind in revenue, CER growth positive USD decline drove ~$0.06 EPS headwind in Q2; FY25 ~90 bps operating margin headwind Headwind intensified
Cost actionsQ1: proactive cost management; margin expansion planned for 2026 Expanded to $100–$120M savings, ~300 bps margin lift modeled for FY26 More aggressive
Product/techQ4: acquisitions broadened portfolio; Q1: multiple launches ASMS launches (timsUltra AIP, timsOmni, timsMetabo); orders “very good” post-launch; biocrates acquisition Strengthening pipeline
Backlog/bookingsQ1: strong start BSI book-to-bill mid-0.9x; backlog ~6.5 months (down from ~7); Q4 seasonal ramp expected Orders soft; backlog still supportive

Management Commentary

  • “Life-science research instruments demand is under pressure… We are lowering our financial guidance for FY 2025…” — Frank H. Laukien, CEO .
  • “Announcing a significantly expanded cost management initiative, expected to reduce our annual costs by $100–$120 million in FY 2026… resume rapid margin expansion and double-digit EPS growth next year, even in a scenario where demand remains muted.” — Frank H. Laukien .
  • “Q2 non-GAAP operating margin was 9%, impacted by weaker volume leverage, unfavorable mix, tariffs and foreign currency… FX resulted in a $0.06 EPS headwind.” — Gerald Herman, CFO .
  • “We’re modeling Swiss tariffs at 15%. In a worst case of 39%, we would re-route production to Germany/France.” — Frank H. Laukien .
  • “We do have ~$30M of cost savings in our FY25 guide, with the bulk of incremental savings hitting in FY26.” — Frank H. Laukien / Gerald Herman .

Q&A Highlights

  • Guide and 4Q cadence: Management comfortable with typical strong seasonality; expects Q3 EPS similar to Q2 and reacceleration in Q4 supported by cost saves and operating leverage .
  • Free cash flow: Q2 burn driven by $50–$60M tax prepayments and working capital; CapEx to scale down in 2H25 .
  • Orders/backlog: BSI book-to-bill mid-0.9x; backlog ~6.5 months, expected to normalize to ~5 months over time as consumables mix rises .
  • Tariffs: FY25 assumptions EU/Israel 15%, Malaysia 19%, Switzerland 15% modeled; contingency to shift builds if needed .
  • Academic funding trajectory: 2025 U.S. academic gov’t down 20–25% for Bruker; early signs of stabilization tied to settlements; timing still uncertain .

Estimates Context

  • Q2 2025 vs consensus: Revenue $797.4M vs $810.2M*; non-GAAP EPS $0.32 vs $0.42*; both below Street, driven by weaker organic demand, tariffs and FX . Values with asterisk (*) are from S&P Global.
  • Forward look: Street modeled Q3/Q4 EPS of ~$0.33*/$0.65* and revenue of ~$847M*/$959M*; management guided a weak Q3 and stronger Q4 on seasonality and cost saves. Q3 actuals subsequently printed above consensus (revenue $860.5M, EPS $0.45), but for this recap the focus is Q2 print and FY25 guide reset (consensus values are from S&P Global; actuals reflected in estimates feed for Q3).
  • Implication: Street models may need to reflect lower FY25 organic growth, tariff/FX headwinds and the timing of cost savings (more 4Q-weighted), with potential FY26 EPS upgrades contingent on execution of $100–$120M cost actions. Values with asterisk (*) are from S&P Global.

Guidance Changes (Detail and Rationale)

  • FY25 revenue to $3.43–$3.50B (from $3.48–$3.55B) on weaker academic, biopharma and industrial demand; organic now -2% to -4% (from 0%–2%); FX tailwind increased to ~2.5%; M&A to ~3.5% .
  • FY25 non-GAAP EPS to $1.95–$2.05 (from $2.40–$2.48); FY25 op margin ~-210 bps YoY (M&A -40 bps; tariffs -60 bps; FX -90 bps; organic -20 bps) .
  • FY26: ~$100–$120M cost savings targeted; management models ~300 bps operating margin uplift even under flat revenue, indicating potential double-digit EPS growth resumption .

Earnings Call Themes & Trends (Deep Dive)

TopicQ-2 (Q4 2024)Q-1 (Q1 2025)Current (Q2 2025)
FY25 setupInitiated FY25 revenue $3.47–$3.54B; EPS $2.67–$2.72 (11–13% YoY) Lowered FY25 to revenue $3.48–$3.55B; EPS $2.40–$2.48 on academic/tariff headwinds Cut again to revenue $3.43–$3.50B; EPS $1.95–$2.05; added detailed headwind components
Multiomics pushM&A broadened portfolio (spatial biology, mol. diagnostics, lab automation) Continued launches across spatial biology, NMR, diagnostics Notable ASMS launches (timsUltra AIP/Omni/Metabo); acquired biocrates
Macro/tariffsFX headwind modest in FY25 guide Tariffs incorporated as of Apr 30 Tariff/FX impacts intensified; Swiss contingency detailed

Management Commentary (Selected Quotes)

  • “Our second quarter came in below expectations… We are lowering our financial guidance for FY 2025…” — Frank H. Laukien .
  • “We anticipate… visibility on U.S. NIH and NSF funding… We are encouraged by several recent settlements… to allow the resumption of grants…” — Frank H. Laukien .
  • “These cost actions are expected to contribute approximately 300 basis points of operating margin improvement in fiscal year 2026 even under flat or muted market demand conditions.” — Gerald Herman .
  • “Our Q4 tends to be more like a 3/10 of the number on an annualized basis… we’re pretty confident you’re going to see a significant lift in operating margin and EPS performance for the fourth quarter.” — Gerald Herman .

Q&A Highlights

  • Street pushback on magnitude/timing: Why not act sooner on cost? Management already had phased saves; ~$30M benefit embedded in FY25, with bulk in FY26; committed to $100–$120M regardless of top line .
  • Leverage and covenants: Company satisfied debt covenants; long-term target around ~2.7x over time (qualitative) .
  • Academic funding path: 2025 down 20–25% for Bruker; FY26 budget visibility limited; some early signs of stabilization from settlements; expect spending to resume promptly upon grant awards .
  • Product channel risk (MALDI/BD): Management does not expect material disruption; >50% MALDI Biotyper sold direct; developing contingencies; competitive dynamics manageable .

Estimates Context

  • Q2 2025 miss: Non-GAAP EPS $0.32 vs $0.42*; Revenue $797.4M vs $810.2M*; driven by organic decline (-7% total), tariffs and FX . Values with asterisk (*) are from S&P Global.
  • Street ahead of guide: Pre-cut FY25 implied higher EPS/organic growth; post-cut, consensus should migrate lower for FY25, with FY26 potentially re-rating on execution of cost saves. Values with asterisk (*) are from S&P Global.

Key Takeaways for Investors

  • Near-term reset: FY25 is a transition year with organic decline and margin compression from tariffs/FX/M&A; Q3 remains weak with an expected 4Q seasonal and cost-driven rebound .
  • Cost actions are the 2026 story: $100–$120M annual savings support ~300 bps operating margin uplift and double-digit EPS growth potential even with muted demand; execution tracking will be key .
  • Innovation underpins medium-term thesis: ASMS launches (timsUltra AIP/Omni/Metabo) and biocrates broaden multiomics and consumables exposure, improving mix and resiliency over time .
  • Order/market watch items: Monitor U.S. NIH/NSF settlements, China stimulus timing, biopharma R&D budgets, and industrial research demand stabilization; these are catalysts for bookings recovery .
  • Tariff/FX sensitivity: Swiss tariff outcome and USD trajectory are tangible EPS levers; Bruker has supply-chain flexibility to mitigate extreme scenarios .
  • Working capital/cash: Expect FCF to improve as tax timing effects abate and CapEx scales down in 2H; watch inventory normalization and order-to-revenue cycle .
  • Trading implications: Post-guide cut, setup skews to execution on cost saves and 4Q delivery; positive surprises could come from tariff relief, faster grant flow, or stronger uptake of new platforms .

Values with asterisk (*) are from S&P Global.