Danaher beats estimates with adjusted earnings of $2.11 a share, raises full-year outlook
Key Facts
Danaher raised its 2026 adjusted earnings per share outlook after third-quarter earnings beat analysts' estimates, in results announced by the company on October 21. The company set its full-year adjusted earnings range at $8.57–$8.62 a share in its statement, compared with a previous range of $8.45–$8.60, raising both ends of its forecast as year-end approaches. Third-quarter adjusted earnings per share were $2.11, according to MT Newswires, compared with analysts' consensus estimate of $1.92 compiled by FactSet. On sales, Dow Jones reported that Danaher's revenue reached $6.55 billion in the third quarter of 2026. Revenue rose 8.3% from the same period a year earlier, but came in slightly below Wall Street's average forecast of $6.56 billion. The quarterly results thus combined a beat on adjusted earnings per share with revenue below analysts' expectations, alongside an increase in the company's full-year earnings forecast.
In its business breakdown, Danaher reported total core revenue growth of 3.0% year over year in the third quarter, compared with the 8.3% revenue growth reported by Dow Jones. The biotechnology segment posted core growth of 5.0% over the same period, outpacing the company's overall core growth rate. The diagnostics segment recorded core growth of 0.5%, trailing biotechnology and the overall business on this measure, according to the earnings statement. On cash generation, Danaher said operating cash flow totaled $1.9 billion in the third quarter of 2026. Free cash flow was about $1.6 billion for the same quarter, based on the non-GAAP measure the company uses in reporting its results.
Excluding respiratory testing revenue, Danaher's core growth was 5.5% year over year in the third quarter, according to the company. The company had recorded growth of 4.5% on the same measure in the second quarter of 2026, putting the latest quarter's pace above the previous quarter's when excluding this business from both periods. Danaher explains the nature of demand for these tests in its second-quarter earnings statement, saying that "demand for respiratory testing is highly dependent on the severity levels of influenza and influenza-like illnesses." The third-quarter results come at the start of a new leadership phase for the company, after Julie Sawyer Montgomery assumed the roles of president and chief executive officer effective October 1, 2026. Her appointment also included joining the board of directors, according to Danaher's leadership change announcement, which specified the same date for her to take on these responsibilities.
For the fourth quarter of 2026, Danaher expects core growth of between 4% and 5% excluding its respiratory testing business, according to Reuters' reporting on the company's outlook. That range puts the expected year-end growth rate below the 5.5% achieved in the third quarter on the same measure. The company expects respiratory testing to subtract about 150 basis points from growth in the fourth quarter, keeping these tests a factor in its outlook for the final quarter. On profitability, Danaher is targeting an adjusted operating profit margin of about 29.5% for the fourth quarter, according to its earnings statement. Barclays described the assumptions underpinning that quarter's outlook as "highly conservative," according to the Reuters report published on the day the results were announced.