Sign in

You're signed outSign in or to get full access.

BC

BIO-TECHNE Corp (TECH)·Q1 2026 Earnings Summary

Executive Summary

  • Q1 FY2026 revenue declined 1% to $286.6M, with organic revenue down 1%; GAAP EPS rose to $0.24 and adjusted EPS was flat at $0.42, while adjusted operating margin expanded 90 bps to 29.9% on productivity and Exosome divestiture benefits .
  • Versus S&P Global consensus, TECH delivered an in-line adjusted EPS ($0.42 vs $0.42*) but a top-line miss ($286.6M vs $291.3M*); EBITDA variance reflects differing definitions, with company-reported adjusted EBITDA of $95.9M .
  • Management guided Q2 organic growth to be consistent with Q1, but flagged a ~400 bps headwind from two cell therapy customers due to FDA fast-track timing; full-year target of at least 100 bps margin expansion remains intact .
  • Growth pillars showed resilience: ProteinSimple’s analytical platforms maintained momentum; Spatial Biology stabilized; China logged a second consecutive growth quarter; dividend of $0.08 per share declared (payable Nov 28, 2025) .

What Went Well and What Went Wrong

What Went Well

  • Adjusted operating margin expanded to 29.9% (+90 bps YoY) on cost containment and mix shifts post Exosome divestiture; adjusted gross margin improved to 70.2% .
  • End-market stabilization signs: strength in large pharma, improving China (second straight growth quarter), and sequential improvement in Spatial Biology; “encouraging signs of stabilization in our US academic end market” (CEO) .
  • ProteinSimple continued momentum: consumables returned to double-digit growth; LEO exceeded placement expectations; Maurice Biologics delivered its sixth consecutive growth quarter .

What Went Wrong

  • Revenue missed consensus and declined 1% YoY; organic down 1% with mid-single-digit decline in Americas, impacted by biotech funding softness and GMP protein order timing .
  • Protein Sciences margin fell 100 bps YoY to 38.4% on volume de-leverage and promotional activity supporting academic/biotech customers .
  • Cell Therapy timing headwinds from fast-track designations created near-term demand air pocket; management expects a ~400 bps headwind to intensify in Q2 before moderating in 2H FY26 .

Financial Results

Consolidated P&L and Margin Trend (Oldest → Newest)

MetricQ3 2025Q4 2025Q1 2026
Revenue ($USD Millions)$316.2 $317.0 $286.6
GAAP Diluted EPS ($)$0.14 ($0.11) $0.24
Adjusted EPS ($)$0.56 $0.53 $0.42
Gross Margin % (GAAP)67.9% 62.7% 65.6%
Adjusted Gross Margin %71.6% 70.0% 70.2%
Adjusted Operating Margin %34.9% 32.0% 29.9%
Adjusted EBITDA ($USD Millions)$122.2 $115.6 $95.9

Actual vs S&P Global Consensus – Q1 FY2026

MetricActualConsensus*Surprise
Revenue ($USD Millions)$286.6 $291.3*Miss of $4.7M (~1.6%)*
Adjusted EPS ($)$0.42 $0.42*In-line*
EBITDA ($USD Millions)Adj. EBITDA $95.9 $93.1*Above consensus (note definitions may differ)*

Values marked with * were retrieved from S&P Global.

Segment Breakdown (Revenue and Segment Margin)

SegmentQ3 2025 Revenue ($M)Q3 2025 Margin %Q4 2025 Revenue ($M)Q4 2025 Margin %Q1 2026 Revenue ($M)Q1 2026 Margin %
Protein Sciences$227.7 45.6% $226.5 43.6% $202.2 38.4%
Diagnostics & Spatial Biology$89.2 9.4% $89.7 6.0% $79.5 11.2%

KPIs and Balance Sheet

KPIQ4 2025Q1 2026
Cash & Equivalents ($M)$162.2 $145.0
Long-term Debt ($M)$346.0 $300.0
Cash from Operations ($M)N/A (annual only)$27.6
CapEx ($M)N/A (quarter not disclosed)$5.4
Weighted Avg Diluted Shares (M)155.8 156.4
Dividend per Share ($)$0.08 (Aug 29, 2025) $0.08 (Nov 28, 2025)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Organic GrowthQ2 FY2026Not specified“Overall Q2 organic growth to be consistent with Q1; ~400 bps headwind from two GMP protein customers” Maintained growth cadence; quantified headwind
Adjusted Operating Margin ExpansionFY2026Not specified“On track to achieve at least 100 bps of margin expansion for the full fiscal year” Introduced explicit FY margin expansion target
Cell Therapy Demand TimingFY2026Not specifiedHeadwinds intensify in Q2, moderate in 2H; underlying funnel remains strong (700 customers; 85 clinical; 5 in phase III) Clarified trajectory
DividendQ1 FY2026$0.08 in prior quarter $0.08 payable Nov 28, 2025 (record Nov 17, 2025) Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 FY2025 and Q4 FY2025)Current Period (Q1 FY2026)Trend
Cell Therapy/GMP ProteinsStrong pillar; Q3 adj margin 34.9%; Q4 segment growth but Exosome impairment hit GAAP FDA fast-track for two large customers creates near-term order timing air pocket; ~200 bps headwind in Q1, ~400 bps in Q2; moderates in 2H Near-term weaker, medium-term constructive
Academic/NIHQ3: macro headwinds; Q4: continued uncertainty Stabilization in U.S.; Europe mid-single-digit growth; shutdown effects limited so far Improving/Stabilizing
Biopharma (Large vs Emerging)Q3: improving pharma end-market; Q4: resilient pharma Large pharma up low double digits; biotech down high single digits but funding uptick and M&A supportive Divergent; large pharma strong, biotech early recovery
Spatial BiologyQ3: segment modest growth; Q4: margin pressure RNAscope returned to growth; order book momentum; ProximityScope launch expands multi-omic workflow Improving
ChinaQ3: not highlightedSecond consecutive quarter of growth, driven by ProteinSimple instruments and spatial portfolio Improving
Margins/ProductivityQ3: adj op margin 34.9%; Q4: adj op margin 32.0% Adjusted operating margin 29.9% (+90 bps YoY); FY target ≥+100 bps; productivity actions to offset GMP headwinds Structurally improving
Tariffs/Onshoring/MacroQ3: arbitration and macro noted Instrument growth not tariff-driven; onshoring may benefit Biologics instruments Neutral to positive

Management Commentary

  • “Encouraging signs of stabilization in our US academic end market and continued strength from large pharmaceutical customers… Spatial Biology stabilized while showing early signs of accelerating growth” — Kim Kelderman, CEO .
  • “Adjusted operating margin reached 29.9%, up 90 basis points year-over-year… better-than-expected margin reflects deliberate management of productivity and cost containment measures” — Jim Hippel, CFO .
  • “Fast Track Designation by the FDA… enabling shortened clinical development and approval timelines. However, these advancements have resulted in short- and intermediate-term order timing headwinds for our GMP proteins business” — Kim Kelderman, CEO .
  • “China delivered its second consecutive quarter of growth… instrument growth does not appear to be driven by tariff-related dynamics; instead, it reflects underlying demand strength” — Kim Kelderman, CEO .

Q&A Highlights

  • Cell therapy cadence: Q1 ~200 bps revenue headwind; Q2 ~400 bps; moderation in 2H; conviction in long-term funnel (700 customers; 85 clinical) .
  • Growth trajectory: Underlying business ex-2 customers at +1% in Q1; implied +3% ex-these in Q2 to offset headwind and keep overall flat YoY .
  • Biotech funding transmission: Improving backdrop (M&A, licensing, lower rates) may shorten lag to demand relative to historical 2–3 quarters .
  • Margins: Additional productivity actions undertaken to offset high-margin GMP headwinds; confidence in ≥100 bps FY expansion .
  • Spatial: RNAscope back to growth; order funnel strengthening; no catch-up effect from prior quarter disruptions .

Estimates Context

  • Q1 FY2026 results versus S&P Global consensus: Adjusted EPS in-line ($0.42 vs $0.42*), revenue miss ($286.6M vs $291.3M*); company-reported adjusted EBITDA of $95.9M compares to a consensus EBITDA of $93.1M* (note: definitions may differ across sources) .
  • Forward look: Q2 consensus revenue $290.1M* and EPS $0.434*; management’s ~400 bps cell therapy headwind and “Q2 organic growth consistent with Q1” comment suggest Street models may need to reflect mix/margin resilience versus near-term top-line headwind .

Values marked with * were retrieved from S&P Global.

Key Takeaways for Investors

  • Near-term top-line headwinds in Cell Therapy from FDA fast-track timing likely persist through Q2, but management expects moderation in 2H and reiterated long-term growth conviction in the funnel .
  • Margin story intact: TECH targets ≥100 bps FY margin expansion, supported by productivity, FX, and portfolio focus post Exosome divestiture; Q1 delivered +90 bps YoY despite the revenue softness .
  • End-market mix favorable: Large pharma demand robust; US academic stabilizing; China logging consecutive growth; Spatial Biology resuming momentum, aided by ProximityScope launch .
  • Segment dynamics: Protein Sciences revenue -1% with margin pressure from promotions; Diagnostics & Spatial -4% reported but +3% organic, margin improved to 11.2% on mix and divestiture .
  • Q2 setup: Expect flat overall organic growth with a ~400 bps cell therapy headwind; watch for sequential margin resilience actions to counter GMP mix impact .
  • Capital deployment and balance sheet: Cash $145M; net debt reduced ($300M LT debt); $27.6M operating cash flow in Q1; dividend maintained at $0.08 per share .
  • Stock narrative: Top-line miss vs consensus offset by stronger profitability and constructive end-market signals; medium-term catalysts include spatial product launches and potential cell therapy demand ramp post regulatory milestones .