Finally, our remarks today will include references to Non-GAAP financials, including net income and diluted earnings per share, which are financial measures that are not defined under generally accepted accounting principles. Investors should review the reconciliation of these Non-GAAP measures to the comparable GAAP results contained in our earnings release. We have also posted a supplemental earnings presentation in the investor relations section of our website for your reference. Total company revenue in the second quarter was approximately $651 million, essentially flat as reported and down 1.9% on a currency-neutral basis compared with the prior year.
Sequentially, revenue was up 10%, reflecting improved performance as our teams overcame challenging end market dynamics in the first quarter. Clinical diagnostics returned to modest currency-neutral growth, led by quality controls in our blood typing portfolio. Excluding process chromatography, life science revenue was approximately flat on a currency-neutral basis, representing an improvement in the segment's underlying trend. In the academic and government market, demand remains below historical levels, particularly in Americas.
NIH funding outlays have begun to increase year-over-year, but purchasing activity typically lags funding. As a reminder, our current niche position in the polishing step of bioprocessing contributes to revenue concentration from a select number of commercial therapeutics and vaccines. Asia Pacific, excluding China, grew 6% on a currency-neutral basis, with growth across most major product areas. China, which represents approximately 6% of Bio-Rad's total revenue, declined in the high teens, reflecting the timing of quality control orders and softer demand for life science instruments.
| Metric | Period | Current guidance |
|---|---|---|
| Full-year currency-neutral revenue growth | FY2026 | -3% to +0.5% (reaffirmed) |
| Life Science currency-neutral growth | FY2026 | -3% to -1% |
| Clinical Diagnostics currency-neutral growth | FY2026 | -3% to +1% |
| Non-GAAP gross margin | FY2026 | 53%-54% (reaffirmed) |
| Non-GAAP operating margin | FY2026 | 10%-12% (reaffirmed) |
| Free cash flow | FY2026 | ~$290M-$340M (reaffirmed) |
| Restructuring savings | By end 2027 | $30M-$35M net annualized savings (after reinvestment), ~$90M one-time cost, ~40-50 bps of 2027 operating margin expansion |
| Metric | YoY | Note |
|---|---|---|
| Total net sales | $651M (flat reported; -1.9% CN) | Life Science weakness on academic softness offset modest Clinical Diagnostics growth; revenue rose 10% sequentially. |
| Clinical Diagnostics | +2.6% reported (+0.3% CN) to $399M | Led by quality controls and blood typing; Americas growth offset by Asia Pacific declines and China order timing. |
| Life Science | -4.1% reported (-5.1% CN) to $252M | Ongoing academic-research market challenges and a tough process chromatography comparison; excluding process chromatography, roughly flat currency-neutral. |
| Digital PCR | +6% CN (instruments +20%+) | QX700 competitive wins and qPCR conversions supported by a broad assay menu and Stilla integration; consumables pull-through still building. |
| GAAP operating income | $72.6M (11.2% margin) | Down from $77.1M a year ago; GAAP gross margin 53.1% vs 53.0%. |
| Non-GAAP operating margin | 12.5% (down from 13.6%) | Instrument mix and elevated logistics costs; up sharply from 6.6% in Q1 on favorable manufacturing absorption. |
| Non-GAAP diluted EPS | $2.62 (vs $2.61) | Non-GAAP net income of $70.2 million, excluding the change in the equity value of the Sartorius stake. |
| GAAP diluted EPS | $13.85 (vs $11.67) | GAAP net income of $371.4 million was heavily inflated by the mark-to-market gain on the Sartorius AG shareholding, not underlying operations. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Portfolio transformation and restructuring | 2024 portfolio review; 2025 rationalization and prior restructuring | Announced the next phase of reshaping organizational structure, workforce, and footprint to reallocate resources toward innovation and growth; targets $30-$35 million net savings by end of 2027, framed as more than a cost program. | — |
| Digital PCR and Stilla | Recently acquired Stilla | One year post-close, the expanded portfolio has accelerated growth and beaten margin expectations; management sees near-term mid-single-digit ddPCR growth building toward high single digits as consumables pull-through develops. | — |
| Academic and biopharma end-market recovery | Depressed demand | NIH funding outlays are beginning to rise year over year (though purchasing lags), and biopharma is showing early stabilization among later-stage and commercial customers; management wants a more sustained pattern before calling a durable recovery. | — |
| China strategy | Soft market | Down high teens on order timing and life science softness; in-China, for-China manufacturing is now operational, enabling participation in a broader range of local-content tenders. | — |
| Sartorius stake | Valuable optionality | View unchanged: a valuable, monetizable asset at the right time and price, with the deferred tax liability already accrued on the balance sheet. | — |
| Elliott Management engagement | — | CEO Schwartz described active, constructive dialogue and broad alignment on improving execution, sharpening capital allocation, and closing the gap between Bio-Rad's value and its share price. | — |
| AI enablement | Early adoption | Agentic AI is accelerating analysis and development, cited as a lever for future efficiency and potential margin expansion beyond the announced restructuring. | — |