Bruker (NASDAQ:BRKR) CFO Gerald Herman said the company’s second-quarter results reflected stronger-than-expected organic order bookings and earnings per share, while revenue came in later than anticipated. He attributed the revenue timing primarily to a mixed demand environment and shipment timing, including semiconductor-metrology orders that are expected to shift into the fourth quarter.
Herman said China returned to growth during the period, with order growth exceeding 20%, while biopharma demand was strong globally, including in the United States. The company’s semiconductor-metrology business also posted more than 15% order growth in the second quarter, driven by artificial intelligence demand, advanced packaging and other industry tailwinds.
Fourth-Quarter Execution and Academic Funding
Bruker expects some semiconductor-related revenue that had been anticipated for the third quarter of 2026 to move into the fourth quarter, increasing the importance of year-end execution. Herman said the company expects more than €1 billion in fourth-quarter revenue, a level he said is achievable given Bruker delivered close to that amount in the fourth quarter of 2024.
The fourth-quarter outlook includes a gigahertz-class NMR system as well as the delayed semiconductor shipments. Herman said the revenue mix, volume leverage and planned cost-saving actions should support operating-margin and earnings performance, provided the anticipated revenue converts as expected.
On U.S. government and academic funding, Herman said Bruker has begun seeing signs of improvement in high-end research tools. Funding releases at the end of September have begun to generate orders, though he said most of those orders would likely affect fourth-quarter bookings rather than create upside for 2026 revenue because of the time required to convert orders into shipments.
“I would expect that we will, however, see an improvement in 2027 revenue performance coming out of this,” Herman said.
He clarified that U.S. academic and government research represents about 8% of Bruker’s total revenue, rather than 40%. Outside the U.S., the company has seen improved academic and government order activity in Europe, China, South Korea and Japan, he said. Herman added that China’s ability to direct funding quickly toward selected sectors has supported demand for high-end research tools.
Semiconductor Backlog and Growth Products
Herman said semiconductor metrology accounts for about 9% of Bruker’s revenue and that order growth remained strong into the third quarter. He said demand appears sustainable through several more quarters and into 2027, although customers control the timing of deliveries based on fab openings and instrument installation schedules.
Bruker generally has three to six months of delivery visibility, Herman said, but customers can defer deliveries further. He said the company historically has not experienced meaningful order cancellations in this business, though revenue recognition can be uneven as customers shift timing between quarters.
Beyond semiconductor metrology, Herman identified Bruker’s timsOmni proteomics platform and timsMetabo metabolomics platform as products with favorable demand prospects. He said the company continues to introduce new products annually across proteomics, microscopy, Raman microscopy, optical and X-ray technologies, as well as energy, fusion and security-detection applications.
AI, Margins and Recurring Revenue
Herman said Bruker views artificial intelligence as a potential tailwind for selected life-science tools providers beginning in 2027 and beyond. He said Bruker’s high-resolution measurement and data-generation capabilities could become increasingly valuable as AI models progress from early workflow testing to deeper biological analysis.
Potential areas of benefit include proteomics, metabolomics, spatial biology and NMR-based analysis, Herman said. He cited Bruker’s minority investment in Itinerary, a company developing a clinical chemistry-focused foundational model that uses a Bruker Fourier 80 benchtop NMR system.
For 2026, Herman said Bruker expects more than 250 basis points of operating-margin expansion. Looking into 2027, management expects more than 100 basis points of additional expansion, with a substantial portion expected to come from cost actions. The company has identified more than $140 million in savings during 2026 and expects a greater annualized benefit in 2027, including about $20 million from reorganizing its NMR, mass spectrometry and optics operations into a biosystems group.
- Management expects higher revenue volume, improved business mix and cost reductions to support 2027 margins.
- Bruker said foreign-exchange headwinds related to euro, Swiss franc and yen manufacturing costs may moderate if the U.S. dollar stabilizes.
- The company is targeting operating margins closer to 20% over time.
Herman said aftermarket revenue, including service, software, spare parts and diagnostics assays, now represents about 40% of total revenue, compared with roughly 25% when he joined the company nine years ago. Bruker is targeting a longer-term mix closer to 50% instruments and 50% aftermarket revenue, potentially through both organic initiatives and acquisitions.
About Bruker (NASDAQ:BRKR)
Bruker Corporation develops and manufactures scientific instruments, analytical systems and software used to study the chemical, physical and biological properties of materials. Its customers include universities, pharmaceutical and biotechnology companies, industrial manufacturers, hospitals, government laboratories and other research organizations.
The company’s product portfolio includes nuclear magnetic resonance and electron paramagnetic resonance systems, mass spectrometers, X-ray analysis instruments, optical and molecular spectroscopy systems, microscopy and nanoanalysis tools, and instruments for microbiology and spatial biology.
