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Danaher Corporation (DHR - Free Report) reported third-quarter 2026 adjusted earnings of $2.11 per share, beating the Zacks Consensus Estimate of $1.92 by 9.9%. The bottom line increased 11.6% year over year from $1.89 per share. Stronger profitability in the Biotechnology segment supported results.
Revenues of $6.55 billion were in line with the consensus estimate of $6.55 billion and grew 8.5% year over year. Core sales rose 3.0%, while core sales excluding respiratory testing advanced 5.5%. Acquisitions contributed to reported growth, led by the Diagnostics segment.
DHR’s Segmental Performance
Revenues from the Biotechnology segment totaled $1.81 billion, up 0.5% year over year from $1.80 billion. Core sales rose 5.0%. Adjusted operating profit increased to $756 million from $669 million, while adjusted operating margin expanded 460 basis points to 41.8%. The segment’s reported operating profit rose to $477 million from $352 million.
Life Sciences revenues were $1.87 billion, up 4.0% from $1.79 billion in the prior-year quarter. Core sales increased 4.5%. Adjusted operating profit climbed to $404 million from $376 million, and adjusted operating margin improved 70 basis points to 21.7%. Reported operating profit increased to $259 million from $222 million.
Diagnostics sales totaled $2.88 billion, increasing 17.0% from $2.46 billion a year earlier. Acquisitions contributed 16.5 percentage points to reported growth. Core sales edged up 0.5%, but core sales excluding respiratory testing increased 7.0%. Adjusted operating profit increased to $831 million from $728 million, although adjusted margin narrowed 80 basis points to 28.8%.
Danaher’s Revenue Growth Drivers
The acquisition-led expansion in the Diagnostics segment contrasted with the relatively modest growth in underlying respiratory-related testing. Respiratory testing revenues were approximately $350 million compared with about $500 million in the year-ago period. The decline remained a headwind to overall core growth.
At the company level, acquisitions and divestitures contributed 6.5% to reported sales growth.
Danaher Corporation Price, Consensus and EPS Surprise
Danaher’s cost of sales rose 7.4% year over year to $2.72 billion. Gross profit increased 8.9% to $3.84 billion, with gross margin of 58.5% compared with 58.2% a year earlier. Selling, general and administrative expenses increased 8.4% to $2.16 billion.
Research and development expenses rose 14.6% to $433 million. Operating profit increased 7.9% to $1.25 billion, while reported operating margin slipped to 19.0% from 19.1%. Adjusted operating profit rose to $1.90 billion from $1.69 billion, lifting adjusted operating margin to 29.0% from 27.9%.
DHR’s Balance Sheet & Cash Flow
Exiting the third quarter, DHR had cash and equivalents of $5.68 billion compared with $4.62 billion at 2025-end. Long-term debt was $24.39 billion at the end of the quarter compared with $18.42 billion at the end of December 2025.
Danaher generated net cash of $4.74 billion from operating activities in the first nine months of 2026 compared with $4.30 billion in the previous year’s comparable period. Capital expenditures totaled $761 million in the same period, down 3.1% year over year. Free cash flow increased 13.0% year over year to $3.98 billion in the first nine months of 2026.
In the same period, DHR paid out dividends of $790 million, up 21.2% on a year-over-year basis.
DHR Raises 2026 Earnings Outlook
For the fourth quarter of 2026, Danaher projects core revenue growth, excluding respiratory testing, of 4.0-5.0% year over year. Respiratory revenues are expected to create a headwind of roughly 150 basis points, resulting in anticipated overall core sales growth of approximately 3.0%. Adjusted operating margin is projected at about 29.5%.
For full-year 2026, Danaher raised its adjusted earnings guidance to $8.57-$8.62 per share from the prior range of $8.45-$8.60. The company expects full-year core revenue growth of about 2.5%, with mid-single-digit growth excluding respiratory testing. Its Life Sciences business is forecast to deliver 3.0-4.0% core sales growth for the year.
Here are some other companies within the broader Medical sector, which according to our model, have the right combination of elements to beat on earnings in this reporting cycle.
Acadia Healthcare Company, Inc. (ACHC - Free Report) has an Earnings ESP of +4.84% and a Zacks Rank of 3 at present. The company is slated to release third-quarter 2026 results on Nov. 4.
Acadia Healthcare’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 47%.
Agios Pharmaceuticals, Inc. (AGIO - Free Report) has an Earnings ESP of +9.37% and a Zacks Rank of 3 at present. The company is scheduled to release third-quarter 2026 results on Nov. 5.
Agios Pharmaceuticals’ earnings surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 7.4%.
Becton, Dickinson and Company (BDX - Free Report) has an Earnings ESP of +0.21% and a Zacks Rank of 2 at present. The company is slated to release fourth-quarter fiscal 2026 (ended September 2026) results on Nov. 5.
Becton’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 2.9%.
View the Zacks #1 Rank List
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DHR Q3 Earnings Beat on Biotechnology Strength, Sales in Line
Key Takeaways
Danaher Corporation (DHR - Free Report) reported third-quarter 2026 adjusted earnings of $2.11 per share, beating the Zacks Consensus Estimate of $1.92 by 9.9%. The bottom line increased 11.6% year over year from $1.89 per share. Stronger profitability in the Biotechnology segment supported results.
Revenues of $6.55 billion were in line with the consensus estimate of $6.55 billion and grew 8.5% year over year. Core sales rose 3.0%, while core sales excluding respiratory testing advanced 5.5%. Acquisitions contributed to reported growth, led by the Diagnostics segment.
DHR’s Segmental Performance
Revenues from the Biotechnology segment totaled $1.81 billion, up 0.5% year over year from $1.80 billion. Core sales rose 5.0%. Adjusted operating profit increased to $756 million from $669 million, while adjusted operating margin expanded 460 basis points to 41.8%. The segment’s reported operating profit rose to $477 million from $352 million.
Life Sciences revenues were $1.87 billion, up 4.0% from $1.79 billion in the prior-year quarter. Core sales increased 4.5%. Adjusted operating profit climbed to $404 million from $376 million, and adjusted operating margin improved 70 basis points to 21.7%. Reported operating profit increased to $259 million from $222 million.
Diagnostics sales totaled $2.88 billion, increasing 17.0% from $2.46 billion a year earlier. Acquisitions contributed 16.5 percentage points to reported growth. Core sales edged up 0.5%, but core sales excluding respiratory testing increased 7.0%. Adjusted operating profit increased to $831 million from $728 million, although adjusted margin narrowed 80 basis points to 28.8%.
Danaher’s Revenue Growth Drivers
The acquisition-led expansion in the Diagnostics segment contrasted with the relatively modest growth in underlying respiratory-related testing. Respiratory testing revenues were approximately $350 million compared with about $500 million in the year-ago period. The decline remained a headwind to overall core growth.
At the company level, acquisitions and divestitures contributed 6.5% to reported sales growth.
Danaher Corporation Price, Consensus and EPS Surprise
Danaher Corporation price-consensus-eps-surprise-chart | Danaher Corporation Quote
DHR’s Cost and Margin Profile
Danaher’s cost of sales rose 7.4% year over year to $2.72 billion. Gross profit increased 8.9% to $3.84 billion, with gross margin of 58.5% compared with 58.2% a year earlier. Selling, general and administrative expenses increased 8.4% to $2.16 billion.
Research and development expenses rose 14.6% to $433 million. Operating profit increased 7.9% to $1.25 billion, while reported operating margin slipped to 19.0% from 19.1%. Adjusted operating profit rose to $1.90 billion from $1.69 billion, lifting adjusted operating margin to 29.0% from 27.9%.
DHR’s Balance Sheet & Cash Flow
Exiting the third quarter, DHR had cash and equivalents of $5.68 billion compared with $4.62 billion at 2025-end. Long-term debt was $24.39 billion at the end of the quarter compared with $18.42 billion at the end of December 2025.
Danaher generated net cash of $4.74 billion from operating activities in the first nine months of 2026 compared with $4.30 billion in the previous year’s comparable period. Capital expenditures totaled $761 million in the same period, down 3.1% year over year. Free cash flow increased 13.0% year over year to $3.98 billion in the first nine months of 2026.
In the same period, DHR paid out dividends of $790 million, up 21.2% on a year-over-year basis.
DHR Raises 2026 Earnings Outlook
For the fourth quarter of 2026, Danaher projects core revenue growth, excluding respiratory testing, of 4.0-5.0% year over year. Respiratory revenues are expected to create a headwind of roughly 150 basis points, resulting in anticipated overall core sales growth of approximately 3.0%. Adjusted operating margin is projected at about 29.5%.
For full-year 2026, Danaher raised its adjusted earnings guidance to $8.57-$8.62 per share from the prior range of $8.45-$8.60. The company expects full-year core revenue growth of about 2.5%, with mid-single-digit growth excluding respiratory testing. Its Life Sciences business is forecast to deliver 3.0-4.0% core sales growth for the year.
DHR’s Zacks Rank
The company currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Stocks to Consider
Here are some other companies within the broader Medical sector, which according to our model, have the right combination of elements to beat on earnings in this reporting cycle.
Acadia Healthcare Company, Inc. (ACHC - Free Report) has an Earnings ESP of +4.84% and a Zacks Rank of 3 at present. The company is slated to release third-quarter 2026 results on Nov. 4.
Acadia Healthcare’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 47%.
Agios Pharmaceuticals, Inc. (AGIO - Free Report) has an Earnings ESP of +9.37% and a Zacks Rank of 3 at present. The company is scheduled to release third-quarter 2026 results on Nov. 5.
Agios Pharmaceuticals’ earnings surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 7.4%.
Becton, Dickinson and Company (BDX - Free Report) has an Earnings ESP of +0.21% and a Zacks Rank of 2 at present. The company is slated to release fourth-quarter fiscal 2026 (ended September 2026) results on Nov. 5.
Becton’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 2.9%.