Waters (NYSE:WAT) reported third-quarter 2026 revenue of $1.767 billion and adjusted earnings per share of $4.10, as the company cited double-digit organic growth, improving performance in acquired businesses and cost actions that supported profitability.
Organic revenue totaled $871 million, rising 9% as reported and 10% on a constant-currency basis. Revenue from the company’s Biosciences and Diagnostic Solutions businesses was $896 million, up 1% on a reported basis. Adjusted EPS increased 21% year over year to $4.10, exceeding the high end of the company’s guidance by $0.05.
“We delivered another quarter of exceptional results with outstanding year-over-year and quarter-over-quarter momentum across our divisions,” President and Chief Executive Officer Udit Batra said. He said organic revenue increased about 5% sequentially from the second quarter, while orders exceeded sales by approximately $20 million.
Segment performance
The Analytical Sciences Division generated revenue of $703 million, up 8% as reported and 9% in constant currency. Constant-currency growth included a 12% increase in chemistry, 10% growth in instruments and 8% growth in service. Pharmaceutical revenue grew at a low-double-digit rate, with demand across ethical pharma, generics, contract research organizations, contract development and manufacturing organizations, and biotechnology customers.
Geographically, Batra said Analytical Sciences growth was led by more than 20% growth in China, mid-teens growth in India, high-single-digit growth in the U.S. and mid-single-digit growth in Europe. Non-pharma revenue grew at a mid-single-digit rate, led by industrial, food and environmental testing demand.
The Biosciences Division reported revenue of $396 million, up 2% from the prior-year comparable period. Flow Clinical grew 4%, while Flow Research increased 1%. Both research and clinical reagents posted high-single-digit growth, according to Chief Financial Officer Amol Chaubal.
Batra said the FACSDiscover A7 flow cytometer, launched in mid-September, has generated strong customer interest and is expected to become a meaningful instrument-growth contributor in the fourth quarter. The company also returned to growth in Biosciences in China after 10 quarters of declines, aided by local manufacturing and commercial execution.
Advanced Diagnostics revenue was $575 million, up 2%. Diagnostic Solutions revenue of $500 million was flat year over year. Microbiology revenue grew 4%, including 6% growth outside China, while China declined more than 20% because of diagnosis-related group, or DRG, headwinds. Molecular diagnostics and point-of-care revenue fell 6%, reflecting channel inventory timing and lower respiratory testing.
Waters’ Clinical Business Unit, which includes its mass-spectrometry diagnostics portfolio, generated $75 million in revenue, increasing 17% as reported and 18% in constant currency. Materials Sciences revenue was $93 million, up 7% as reported and 9% in constant currency, supported by electronics testing for semiconductor and data-center applications and thermal analysis for aerospace and defense.
Integration actions and product launches
Management said initiatives in its acquired businesses are progressing ahead of expectations. Net price realization reached 120 basis points in the quarter, up from 90 basis points in the prior quarter. The company expects to meet or exceed 150 basis points over the next several quarters.
Waters also expects efforts to improve reagent-rental compliance to begin recovering low- to mid-single-digit millions of dollars in revenue per quarter beginning in the fourth quarter. The company said local manufacturing in China came online ahead of schedule for Biosciences and plans to localize its microbiology portfolio in China as part of a second phase of initiatives.
The company said its BACTEC FXi culture system, FACSDiscover A7 system, increased service-plan attachment and new digital sales channels will all contribute in the fourth quarter. Waters reiterated that it remains on track to generate $50 million in revenue synergies during 2026.
In molecular diagnostics, Waters announced commercial partnerships with Quest Diagnostics and Labcorp for its FDA-cleared Onclarity HPV self-collection kit. Management said the product allows people to collect samples at home and that revenue is expected to begin next year as samples are processed using the BD COR platform.
Waters also announced the acquisition of MOBILion Systems, which develops SLIM high-resolution ion mobility separation technology. Batra described the deal as a small tuck-in financially and said it expands Waters’ presence in discovery proteomics by pairing the technology with its Xevo MRT mass spectrometer.
AI initiatives and outlook
Batra said artificial intelligence is contributing to experimental activity in pharmaceutical research and is creating new opportunities across discovery, development and quality-control workflows. Waters launched AI Link to reduce the time needed to connect AI agents to its instruments from weeks to hours, he said.
The company is also adding AI capabilities to its Empower software platform. Waters previously introduced AI-powered anomaly detection and recently announced AI-powered peak integration, which Batra said reduced manual interventions by as much as 95% in a pilot with a large pharmaceutical customer. Additional AI applications for column selection, method development and release timelines are planned for the first half of 2027.
However, Batra said it was too early to quantify the revenue impact of AI-related demand.
For full-year 2026, Waters raised its organic constant-currency revenue growth outlook by 140 basis points at the midpoint to a range of 9.1% to 9.7%. The company expects organic reported revenue of $3.429 billion to $3.447 billion and approximately $3.05 billion in Biosciences and Diagnostic Solutions revenue.
- Total 2026 reported revenue is projected at $6.479 billion to $6.497 billion.
- Full-year adjusted EPS is expected to be $14.60 to $14.70, representing growth of 11% to 12% year over year.
- Fourth-quarter total reported revenue is forecast at $1.801 billion to $1.819 billion.
- Fourth-quarter adjusted EPS is expected to be $4.58 to $4.68.
For 2027, Waters provided an initial framework calling for high-single-digit growth in the legacy Waters business and mid-single-digit growth in the legacy BD business. Combined-company organic growth is expected to begin at a mid-single-digit-plus rate, with a potential path to high-single-digit growth as pricing, product launches, revenue synergies, pharmaceutical reshoring and AI-related demand develop.
The company’s starting 2027 framework includes adjusted operating-margin expansion of 100 basis points to 29.2% and low-teens adjusted EPS growth. Chaubal said the company expects to add about $60 million of revenue synergies in 2027, above the $50 million anticipated in 2026.
About Waters (NYSE:WAT)
Waters Corporation (NYSE:WAT) develops and manufactures analytical technologies used to measure, identify and characterize chemical and biological substances. Its customers include pharmaceutical and biotechnology companies, industrial manufacturers, academic and government laboratories, and organizations involved in food, environmental and clinical testing.
The company’s product portfolio includes high-performance liquid chromatography and ultra-performance liquid chromatography systems, mass spectrometers, chromatography columns and consumables, and laboratory software for data management and analysis.
