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Solventum Stock Down Despite Q1 Earnings & Revenues Beat Estimates
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Key Takeaways
Solventum posted Q1 adjusted EPS of $1.48, beating estimates by 9.6% on $2B in revenue.
SOLV saw organic sales growth across all segments, led by MedSurg and Dental Solutions.
Solventum reaffirmed 2026 guidance and expects up to 3% organic sales growth.
Solventum (SOLV - Free Report) reported first-quarter 2026 adjusted earnings per share (EPS) of $1.48, which beat the Zacks Consensus Estimate of $1.35 by 9.6%. The bottom line improved 10.4% year over year.
GAAP EPS in the quarter was 7 cents compared with 78 cents in the year-ago quarter.
Revenue Details
The company reported revenues of $2 billion, down 3% reportedly from the prior-year recorded number. Organically, sales were up 2.1%. The metric beat the Zacks Consensus Estimate by 1%. Organic sales growth was driven by positive performance from all segments, primarily driven by results of the Infection Prevention and Surgical Solutions business within MedSurg, as well as Dental Solutions.
However, shares of the company were down 2.8% during after-hours trading on May 5.
Segmental Details
MedSurg
Revenues from the segment totaled $1.2 billion, up 1.2% organically year over year. Growth was driven by continued strength in Advanced Wound Care, where Negative Pressure Wound Therapy benefited from strong brand momentum, new product launches and commercial enhancements. Management also highlighted ongoing demand for traditional and single-use therapies, including V.A.C. Peel and Place Dressings, alongside contributions from the recently acquired Acera business. Infection Prevention & Surgical Solutions delivered solid performance despite a tough year-ago comparison, supported by improved commercial alignment, healthy customer demand and continued traction for Tegaderm CHG and recent Attest sterilization product launches.
Dental Solutions
Segment revenues totaled $354 million, up 3.4% organically year over year. Growth was primarily driven by strong demand in core restoratives, supported by new product launches such as Filtek Easy Match and Clinpro Clear, along with benefits from a more specialized sales force. Management also noted continued progress in reducing backorders, which improved customer service levels and supported momentum across the business.
Health Information Systems (HIS)
Revenues from the segment were $342 million, up 4.7% organically year over year. Growth was driven by continued strength in Revenue Cycle Management and Performance Management solutions, particularly within autonomous coding offerings across inpatient and outpatient settings. The company also benefited from strong customer retention, backlog conversion and ongoing international expansion, partially offset by expected double-digit declines in Clinician Productivity Solutions.
Solventum Corporation Price, Consensus and EPS Surprise
Adjusted gross profit was $1.13 billion, down 1.6% year over year. However, as a percentage of revenues, the adjusted gross margin was 56.4%, up approximately 80 bps from the prior-year quarter’s figure.
Selling, general and administrative expenses totaled $827 million, up 7.5% year over year.
Research and development expenses totaled $189 million, down 2.1% on a year-over-year basis. Adjusted operating expenses totaled $740 million, down 0.5% year over year.
Adjusted operating income totaled $392 million, down 3.7% year over year. As a percentage of revenues, the adjusted operating margin was 19.5%, down approximately 20 bps from the prior-year quarter’s figure.
Financial Position
Solventum exited the first quarter with cash, cash equivalents and investments of $561 million compared with $878 million in the previous quarter.
Total assets decreased to $14.1 billion from $14.3 billion in the previous quarter.
Net cash used in operating activities during the first quarter was $189 million against net cash provided by operating activities of $29 million in the year-ago period.
2026 Guidance
Solventum affirmed its guidance for 2026. The company continues to expect organic sales growth at the higher end of 2-3% (3-4% excluding 100bps of SKU Exit impact). The Zacks Consensus Estimate is pegged at $8.11 billion.
SOLV continues to expect adjusted EPS to be in the band of $6.40-$6.60. The Zacks Consensus Estimate for earnings is pinned at $6.50 per share.
Our Take
Solventum exited the first quarter of 2026 on a strong note, with both earnings and revenues surpassing the Zacks Consensus Estimate. The company continued to witness improving commercial momentum across all three segments, driven by volume growth, new product launches and operational execution. Strength in MedSurg was led by negative pressure wound therapy, Tegaderm CHG and sterilization products, while Dental Solutions benefited from strong adoption of Filtek Easy Match and Clinpro Clear, supported by improved supply-chain execution and lower backorders. Health Information Systems also remained solid, aided by continued traction in revenue cycle management and autonomous coding solutions.
Management highlighted that the company’s commercial transformation efforts, including greater sales-force specialization, stronger accountability and leadership enhancements, are beginning to translate into improved execution and faster growth across key platforms. Solventum also reiterated confidence in its innovation pipeline, with nearly 20 new products expected to launch over the next two years, largely within its identified growth-driver categories.
During the quarter, Solventum continued to make progress on portfolio optimization and separation activities. The integration of Acera Surgical is tracking well and is expected to support growth in the Advanced Wound Care business, while the company maintains that tuck-in acquisitions remain a strategic priority. Meanwhile, the divestiture of the Purification & Filtration business strengthened the balance sheet and enabled continued debt reduction, share repurchases and future acquisition flexibility.
The company also remains on track with its multiyear “Transform for the Future” initiative, which is expected to deliver approximately $500 million in savings through structural simplification, automation and footprint optimization. Further, Solventum has now exited more than half of its transition service agreements with 3M and completed significant ERP migration milestones, positioning the company for improved operational efficiency in 2027 and beyond.
Solventum currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks from the broader medical space that are expected to report earnings soon are DexCom, Inc. (DXCM - Free Report) , Encompass Health Corporation (EHC - Free Report) and The Cooper Companies, Inc. (COO - Free Report) .
The Zacks Consensus Estimate for DexCom’s first-quarter 2026 adjusted EPS is currently pegged at 47 cents. The consensus estimate for revenues is pegged at $1.18 billion. DXCM currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
DexCom has an estimated long-term growth rate of 20.6%. DXCM’s earnings yield of 4.1% compares favorably with the industry’s negative yield.
Encompass Health currently has a Zacks Rank #2. The Zacks Consensus Estimate for its first-quarter 2026 adjusted EPS is currently pegged at $1.51. The same for revenues is pegged at $1.57 billion.
Encompass Health has an estimated long-term growth rate of 8.8%. EHC’s earnings yield of 5.9% compares favorably with the industry’s 5.6%.
Cooper Companies currently carries a Zacks Rank #2. The Zacks Consensus Estimate for its second-quarter fiscal 2026 adjusted EPS is currently pegged at $1.10. The same for its revenues is pegged at $1.05 billion.
Cooper Companies has an estimated long-term growth rate of 8.4%. COO’s earnings yield of 7.2% compares favorably with the industry’s 6.1%.
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Solventum Stock Down Despite Q1 Earnings & Revenues Beat Estimates
Key Takeaways
Solventum (SOLV - Free Report) reported first-quarter 2026 adjusted earnings per share (EPS) of $1.48, which beat the Zacks Consensus Estimate of $1.35 by 9.6%. The bottom line improved 10.4% year over year.
GAAP EPS in the quarter was 7 cents compared with 78 cents in the year-ago quarter.
Revenue Details
The company reported revenues of $2 billion, down 3% reportedly from the prior-year recorded number. Organically, sales were up 2.1%. The metric beat the Zacks Consensus Estimate by 1%. Organic sales growth was driven by positive performance from all segments, primarily driven by results of the Infection Prevention and Surgical Solutions business within MedSurg, as well as Dental Solutions.
However, shares of the company were down 2.8% during after-hours trading on May 5.
Segmental Details
MedSurg
Revenues from the segment totaled $1.2 billion, up 1.2% organically year over year. Growth was driven by continued strength in Advanced Wound Care, where Negative Pressure Wound Therapy benefited from strong brand momentum, new product launches and commercial enhancements. Management also highlighted ongoing demand for traditional and single-use therapies, including V.A.C. Peel and Place Dressings, alongside contributions from the recently acquired Acera business. Infection Prevention & Surgical Solutions delivered solid performance despite a tough year-ago comparison, supported by improved commercial alignment, healthy customer demand and continued traction for Tegaderm CHG and recent Attest sterilization product launches.
Dental Solutions
Segment revenues totaled $354 million, up 3.4% organically year over year. Growth was primarily driven by strong demand in core restoratives, supported by new product launches such as Filtek Easy Match and Clinpro Clear, along with benefits from a more specialized sales force. Management also noted continued progress in reducing backorders, which improved customer service levels and supported momentum across the business.
Health Information Systems (HIS)
Revenues from the segment were $342 million, up 4.7% organically year over year. Growth was driven by continued strength in Revenue Cycle Management and Performance Management solutions, particularly within autonomous coding offerings across inpatient and outpatient settings. The company also benefited from strong customer retention, backlog conversion and ongoing international expansion, partially offset by expected double-digit declines in Clinician Productivity Solutions.
Solventum Corporation Price, Consensus and EPS Surprise
Solventum Corporation price-consensus-eps-surprise-chart | Solventum Corporation Quote
Margins
Adjusted gross profit was $1.13 billion, down 1.6% year over year. However, as a percentage of revenues, the adjusted gross margin was 56.4%, up approximately 80 bps from the prior-year quarter’s figure.
Selling, general and administrative expenses totaled $827 million, up 7.5% year over year.
Research and development expenses totaled $189 million, down 2.1% on a year-over-year basis. Adjusted operating expenses totaled $740 million, down 0.5% year over year.
Adjusted operating income totaled $392 million, down 3.7% year over year. As a percentage of revenues, the adjusted operating margin was 19.5%, down approximately 20 bps from the prior-year quarter’s figure.
Financial Position
Solventum exited the first quarter with cash, cash equivalents and investments of $561 million compared with $878 million in the previous quarter.
Total assets decreased to $14.1 billion from $14.3 billion in the previous quarter.
Net cash used in operating activities during the first quarter was $189 million against net cash provided by operating activities of $29 million in the year-ago period.
2026 Guidance
Solventum affirmed its guidance for 2026. The company continues to expect organic sales growth at the higher end of 2-3% (3-4% excluding 100bps of SKU Exit impact). The Zacks Consensus Estimate is pegged at $8.11 billion.
SOLV continues to expect adjusted EPS to be in the band of $6.40-$6.60. The Zacks Consensus Estimate for earnings is pinned at $6.50 per share.
Our Take
Solventum exited the first quarter of 2026 on a strong note, with both earnings and revenues surpassing the Zacks Consensus Estimate. The company continued to witness improving commercial momentum across all three segments, driven by volume growth, new product launches and operational execution. Strength in MedSurg was led by negative pressure wound therapy, Tegaderm CHG and sterilization products, while Dental Solutions benefited from strong adoption of Filtek Easy Match and Clinpro Clear, supported by improved supply-chain execution and lower backorders. Health Information Systems also remained solid, aided by continued traction in revenue cycle management and autonomous coding solutions.
Management highlighted that the company’s commercial transformation efforts, including greater sales-force specialization, stronger accountability and leadership enhancements, are beginning to translate into improved execution and faster growth across key platforms. Solventum also reiterated confidence in its innovation pipeline, with nearly 20 new products expected to launch over the next two years, largely within its identified growth-driver categories.
During the quarter, Solventum continued to make progress on portfolio optimization and separation activities. The integration of Acera Surgical is tracking well and is expected to support growth in the Advanced Wound Care business, while the company maintains that tuck-in acquisitions remain a strategic priority. Meanwhile, the divestiture of the Purification & Filtration business strengthened the balance sheet and enabled continued debt reduction, share repurchases and future acquisition flexibility.
The company also remains on track with its multiyear “Transform for the Future” initiative, which is expected to deliver approximately $500 million in savings through structural simplification, automation and footprint optimization. Further, Solventum has now exited more than half of its transition service agreements with 3M and completed significant ERP migration milestones, positioning the company for improved operational efficiency in 2027 and beyond.
Solventum Corporation Price
Solventum Corporation price | Solventum Corporation Quote
SOLV’s Zacks Rank and Other Key Picks
Solventum currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks from the broader medical space that are expected to report earnings soon are DexCom, Inc. (DXCM - Free Report) , Encompass Health Corporation (EHC - Free Report) and The Cooper Companies, Inc. (COO - Free Report) .
The Zacks Consensus Estimate for DexCom’s first-quarter 2026 adjusted EPS is currently pegged at 47 cents. The consensus estimate for revenues is pegged at $1.18 billion. DXCM currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
DexCom has an estimated long-term growth rate of 20.6%. DXCM’s earnings yield of 4.1% compares favorably with the industry’s negative yield.
Encompass Health currently has a Zacks Rank #2. The Zacks Consensus Estimate for its first-quarter 2026 adjusted EPS is currently pegged at $1.51. The same for revenues is pegged at $1.57 billion.
Encompass Health has an estimated long-term growth rate of 8.8%. EHC’s earnings yield of 5.9% compares favorably with the industry’s 5.6%.
Cooper Companies currently carries a Zacks Rank #2. The Zacks Consensus Estimate for its second-quarter fiscal 2026 adjusted EPS is currently pegged at $1.10. The same for its revenues is pegged at $1.05 billion.
Cooper Companies has an estimated long-term growth rate of 8.4%. COO’s earnings yield of 7.2% compares favorably with the industry’s 6.1%.