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• Revenue: $5.7 billion in the first quarter, with core revenue flat year-over-year.

• Gross Profit Margin: 61.2%, up 100 basis points year-over-year.

• Adjusted Operating Profit Margin: 29.6%, down 50 basis points.

• Adjusted Diluted Net Earnings Per Share: $1.88.

• Free Cash Flow: $1.1 billion, with a free cash flow to net income conversion ratio of more than 110%.

• Biotechnology Segment Core Revenue Growth: Increased 7%, with bioprocessing up high single digits.

• Life Sciences Segment Core Revenue: Decreased by 4%.

• Diagnostics Segment Core Revenue: Declined 1.5%.

• Full Year 2025 Core Revenue Growth Expectation: Approximately 3%.

• Full Year 2025 Adjusted Diluted EPS Guidance: $7.60 to $7.75.

• Warning! GuruFocus has detected 4 Warning Signs with DHR.

Release Date: April 22, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Danaher Corp (NYSE:DHR) reported first-quarter revenue, earnings, and cash flow ahead of expectations, driven by strong momentum in bioprocessing and higher-than-anticipated respiratory demand at Cepheid.

• The company achieved a gross profit margin of 61.2%, up 100 basis points year-over-year, indicating improved profitability.

• Danaher Corp (NYSE:DHR) generated $1.1 billion of free cash flow in the quarter, resulting in a free cash flow to net income conversion ratio of more than 110%.

• The company is making significant investments in long-term growth initiatives, resulting in impactful new product launches across its Biotechnology, Life Sciences, and Diagnostics segments.

• Bioprocessing segment showed strong performance with core revenue increasing by 7%, driven by low double-digit growth in consumables and robust demand for commercialized therapies.

Negative Points

• Core revenue in the Life Sciences segment decreased by 4%, with a decline in life sciences instrument businesses and weaker demand for plasmids and mRNA.

• Core revenue in the Diagnostics segment declined by 1.5%, impacted by volume-based procurement and reimbursement changes in China.

• The company faces several hundred million dollars in gross impact from tariffs, although it plans to offset this through supply chain adjustments and other measures.

• Danaher Corp (NYSE:DHR) experienced a high single-digit decline in core revenues within China, primarily affecting its diagnostics businesses.

• The macroeconomic environment remains dynamic with rising geopolitical and trade tensions, contributing to greater uncertainty across global markets.

Q & A Highlights

Q: Can you elaborate on the strength in the bioprocessing segment and what is driving the increased confidence in this area? A: Rainer Blair, President and CEO, explained that the bioprocessing segment showed strong order and revenue performance, with core revenue growth expected to be high single digits for 2025. This growth is primarily driven by low double-digit growth in consumables due to strong commercial demand from large pharma and CMO customers. Equipment orders and funnels are improving, although not yet back to normal levels.