Waters Q3 Earnings Surpass Estimates, Revenue Increase Y/Y

Core Insights - Waters Corporation (WAT) reported third-quarter 2025 non-GAAP earnings of $3.40 per share, exceeding the Zacks Consensus Estimate by 5.92% and reflecting a 16% year-over-year increase [1][8] - Net sales reached $800 million, surpassing the Zacks Consensus Estimate by 2.59%, with an 8% increase year-over-year on both reported and constant currency (cc) bases [1][8] Segment Performance - The Waters segment generated sales of $713.4 million, up 9% year-over-year on both reported and cc bases, while the TA segment reported sales of $86.5 million, reflecting a 2% increase [2] - In terms of product categories, Instruments sales were $341.5 million (up 6%), Services sales were $299.9 million (up 8% reported, 7% cc), and Chemistry sales were $158.5 million (up 14% reported, 13% cc) [3] - The Pharmaceutical market generated sales of $479.8 million, increasing 12% year-over-year, while Industrial sales were $235.7 million (up 3%) and Government & Academic sales were $84.4 million (up 2%) [4] Geographic Performance - Asia generated sales of $269.7 million, up 7% reported and 13% cc, while the Americas reported sales of $292.8 million (up 5%) and Europe generated $237.4 million (up 13% reported, 5% cc) [5] Operating Details - Non-GAAP selling and administrative expenses were $179.7 million, an 8.3% increase year-over-year, while research and development expenses rose to $49.9 million (up 11.7%) [6] - The adjusted operating margin was 30.3%, contracting by 50 basis points year-over-year [6] Financial Position - As of September 27, 2025, cash and cash equivalents were $459.1 million, up from $367.2 million as of June 28, with cash from operations reported at $187.3 million and free cash flow at $159.6 million [7] Future Guidance - Waters raised its 2025 guidance for cc sales growth to between 6.7% and 7.3%, with reported sales growth expected in the 6.5%-7.1% range [9] - Non-GAAP earnings guidance for 2025 is now projected to be in the range of $13.05 to $13.15 per share, indicating year-over-year growth of over 10% to 12% on a cc basis [9] - For Q4 2025, Waters expects cc sales growth between 5% and 7%, with non-GAAP earnings projected at $4.45 to $4.55 per share, reflecting year-over-year growth of over 9% to 11% [10]