Bio-Rad Laboratories, Inc 10-Q for FY2026 Q2
Bio-Rad Laboratories, Inc. (BIO)
10-Q
2026-08-04
For: 2026-06-30
View Original
Added on
August 04, 2026
About this 10-Q
Bio-Rad Laboratories, Inc filed this 10-Q on August 4, 2026, covering the quarter ended June 30, 2026 (FY2026 Q2).
Headline figures
Quarter ended June 30, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $651M
- down 0.1% from $651.6M a year earlier
- Net income
- $371.4M
- up 16.9% from net income of $317.8M a year earlier
- Diluted EPS
- $13.85
- up 18.7% from $11.67 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| (Mark One) | |||||
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
| For the quarterly period ended | |||||
or
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from ______________to __________
| Commission file number | |||||
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (I.R.S. Employer Identification No.) | ||||||||||||||||
| (Address of principal executive offices) | (Zip Code) | ||||||||||||||||
(Registrant's telephone number, including area code)
No Change
(Former name, former address and former fiscal year, if changed since last report.)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange | ||||||||||||||
| Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been | ||||||||||||||
| subject to such filing requirements for the past 90 days. | ☒ | No | ☐ | |||||||||||
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232,405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit files).
| ☒ | No | ☐ | ||||||||||||
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):
| ☒ | Accelerated filer | ☐ | ||||||||||||
| Non-accelerated filer | ☐ | Smaller reporting company | ||||||||||||
| Emerging growth company | ||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
| Yes | No | ☒ | ||||||||||||
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Common Shares Outstanding at July 28, 2026: | Class A - | Class B - | ||||||||||||
BIO-RAD LABORATORIES, INC.
FORM 10-Q JUNE 30, 2026
TABLE OF CONTENTS
Item 1. | ||||||||
2
INFORMATION RELATING TO FORWARD-LOOKING STATEMENTS
Other than statements of historical fact, statements made in this report include forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, statements we make regarding our future financial performance, operating results, plans and objectives. Forward-looking statements generally can be identified by the use of forward-looking terminology, such as “believe,” “expect,” “anticipate,” “may,” “will,” “intend,” “estimate,” “continue,” “seek,” “future,” or similar expressions or the negative of those terms or expressions. Such statements involve risks and uncertainties, which could cause actual results to vary materially from those expressed in or indicated by the forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events. However, actual results may differ materially from those currently anticipated depending on a variety of risk factors including, but not limited to, the risks relating to our international operations, global economic and geopolitical conditions, tariffs or other trade barriers, reductions in government funding or capital spending of our customers, our ability to develop and market new or improved products, our ability to compete effectively, foreign currency exchange fluctuations, supply chain issues, risks associated with our position in Sartorius AG, risks to our information technology systems, intellectual property risks, our ability to attract and retain key personnel, international legal and regulatory risks, product quality and liability issues, our ability to integrate acquired companies, products or technologies into our company successfully, changes in the healthcare industry, natural disasters and other catastrophic events beyond our control, and other risks and uncertainties identified under “Part II, Item 1A, Risk Factors” of this Quarterly Report on Form 10-Q. We caution you not to place undue reliance on forward-looking statements, which reflect an analysis only and speak only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.
3
PART I – FINANCIAL INFORMATION
BIO-RAD LABORATORIES, INC.
Condensed Consolidated Balance Sheets
(In millions, except share data)
| June 30, 2026 | December 31, 2025 | ||||||||||
ASSETS | (Unaudited) | ||||||||||
Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Short-term investments | |||||||||||
Accounts receivable, less allowance for credit losses of $ | |||||||||||
| Inventory | |||||||||||
| Prepaid expenses | |||||||||||
| Other current assets | |||||||||||
| Total current assets | |||||||||||
| Property, plant and equipment, net | |||||||||||
| Operating lease right-of-use assets | |||||||||||
| Goodwill, net | |||||||||||
| Purchased intangibles, net | |||||||||||
| Other investments | |||||||||||
| Other assets | |||||||||||
| Total assets | $ | $ | |||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
4
BIO-RAD LABORATORIES, INC.
Condensed Consolidated Balance Sheets
(continued)
(In millions, except share data)
| June 30, 2026 | December 31, 2025 | ||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | (Unaudited) | ||||||||||
Current liabilities: | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Accrued payroll and employee benefits | |||||||||||
| Current maturities of long-term debt and notes payable | |||||||||||
| Income and other taxes payable | |||||||||||
| Current operating lease liabilities | |||||||||||
| Other current liabilities | |||||||||||
| Total current liabilities | |||||||||||
| Long-term debt, net of current maturities | |||||||||||
| Deferred income taxes | |||||||||||
| Operating lease liabilities | |||||||||||
| Other long-term liabilities | |||||||||||
| Total liabilities | |||||||||||
| Stockholders’ equity: | |||||||||||
Preferred stock, $ | |||||||||||
Class A common stock, $ | |||||||||||
Class B common stock, $ | |||||||||||
| Additional paid-in capital | |||||||||||
Class A treasury stock at cost, | ( | ( | |||||||||
| Retained earnings | |||||||||||
| Accumulated other comprehensive income (loss) | ( | ( | |||||||||
| Total stockholders’ equity | |||||||||||
| Total liabilities and stockholders’ equity | $ | $ | |||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
5
BIO-RAD LABORATORIES, INC.
Condensed Consolidated Statements of Income (Loss)
(In millions, except number of shares, which are reflected in thousands, and per share data)
(Unaudited)
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Cost of goods sold | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Selling, general and administrative expense | |||||||||||||||||||||||
| Research and development expense | |||||||||||||||||||||||
| Income from operations | |||||||||||||||||||||||
| Interest expense | |||||||||||||||||||||||
| Foreign currency exchange (gains) losses, net | ( | ( | ( | ||||||||||||||||||||
| (Gains) losses from change in fair market value of equity securities and loan receivable | ( | ( | ( | ||||||||||||||||||||
| Other income, net | ( | ( | ( | ( | |||||||||||||||||||
| Income (loss) before income taxes | ( | ||||||||||||||||||||||
| Provision for income taxes | ( | ( | ( | ( | |||||||||||||||||||
| Net income (loss) | $ | $ | $ | ( | $ | ||||||||||||||||||
Basic earnings (loss) per share: | |||||||||||||||||||||||
Net income (loss) per basic share | $ | $ | $ | ( | $ | ||||||||||||||||||
| Weighted average common shares - basic | |||||||||||||||||||||||
| Diluted earnings (loss) per share: | |||||||||||||||||||||||
| Net income (loss) per diluted share | $ | $ | $ | ( | $ | ||||||||||||||||||
| Weighted average common shares - diluted | |||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
6
BIO-RAD LABORATORIES, INC.
Condensed Consolidated Statements of Comprehensive Income (Loss)
(In millions, unaudited)
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
Net income (loss) | $ | $ | $ | ( | $ | ||||||||||||||||||
| Other comprehensive income (loss), net of tax: | |||||||||||||||||||||||
| Foreign currency translation adjustments | ( | ( | |||||||||||||||||||||
| Foreign other post-employment benefits adjustments | ( | ( | ( | ( | |||||||||||||||||||
| Net unrealized holding gains (losses) on available-for-sale investments | ( | ( | |||||||||||||||||||||
Net unrealized holding gains (losses) on cash flow hedge | |||||||||||||||||||||||
| Other comprehensive income (loss) | ( | ( | |||||||||||||||||||||
| Comprehensive income (loss) | $ | $ | $ | ( | $ | ||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
7
BIO-RAD LABORATORIES, INC.
Condensed Consolidated Statements of Cash Flows
(In millions, unaudited)
| Six Months Ended | |||||||||||
| June 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Cash received from customers | $ | $ | |||||||||
| Cash paid to suppliers and employees | ( | ( | |||||||||
| Interest paid, net | ( | ( | |||||||||
| Income tax payments, net | ( | ( | |||||||||
Dividend proceeds and miscellaneous receipts, net | |||||||||||
| Proceeds from (payments for) forward foreign exchange contracts, net | ( | ||||||||||
| Net cash provided by operating activities | |||||||||||
| Cash flows from investing activities: | |||||||||||
| Payments for purchases of property, plant and equipment | ( | ( | |||||||||
| Proceeds from dispositions of property, plant and equipment | |||||||||||
| (Payments for) proceeds from acquisitions, net of cash received | ( | ||||||||||
| Payments for purchases of marketable securities and investments | ( | ( | |||||||||
| Proceeds from sales of marketable securities and investments | |||||||||||
| Proceeds from maturities of marketable securities and investments | |||||||||||
| Net cash used in investing activities | ( | ( | |||||||||
| Cash flows from financing activities: | |||||||||||
Payments on long-term debt | ( | ( | |||||||||
| Proceeds from issuance of common stock and from reissuance of treasury stock under the employee stock purchase plan and upon exercise of stock options | |||||||||||
| Tax payments from net share settlement | ( | ( | |||||||||
| Payments for purchases of treasury stock | ( | ( | |||||||||
| Option premium proceeds for structured purchases of treasury stock | |||||||||||
| Net cash used in financing activities | ( | ( | |||||||||
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash | ( | ||||||||||
| Net decrease in cash, cash equivalents and restricted cash | ( | ( | |||||||||
| Cash, cash equivalents and restricted cash at beginning of period | |||||||||||
| Cash, cash equivalents and restricted cash at end of period | $ | $ | |||||||||
Reconciliation of cash, cash equivalents and restricted cash (in millions):
| June 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Restricted cash included in Other current assets | |||||||||||
| Restricted cash included in Other assets | |||||||||||
| Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows | $ | $ | |||||||||
These restricted cash items are primarily related to performance guarantees and other restricted deposits.
The accompanying notes are an integral part of these condensed consolidated financial statements.
8
BIO-RAD LABORATORIES, INC.
Condensed Consolidated Statements of Changes in Stockholders' Equity
(In millions, unaudited)
| Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Stockholders' Equity | ||||||||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||
| Net income (loss) | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||
| Other comprehensive income (loss), net of tax | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||
| Stock compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Purchase of treasury stock | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Reissuance of treasury stock | — | ( | — | — | |||||||||||||||||||||||||||||||
| Option premium received for structured purchases of treasury stock | — | — | — | — | |||||||||||||||||||||||||||||||
| Excise tax on stock repurchase | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Balance at March 31, 2026 | $ | $ | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | |||||||||||||||||||||||||||||||
| Other comprehensive income (loss), net of tax | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||
| Stock compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Purchase of treasury stock | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Shares withheld related to net share settlement of equity awards | — | ( | — | — | — | ( | |||||||||||||||||||||||||||||
| Excise tax on stock repurchase | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Reissuance of treasury stock | — | ( | — | — | |||||||||||||||||||||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||
| Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Stockholders' Equity | ||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | |||||||||||||||||||||||||||||||
| Other comprehensive income (loss), net of tax | — | — | — | — | |||||||||||||||||||||||||||||||
| Stock compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Purchase of treasury stock | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Reissuance of treasury stock | — | ( | — | — | |||||||||||||||||||||||||||||||
| Excise tax on stock repurchase | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Balance at March 31, 2025 | $ | $ | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | |||||||||||||||||||||||||||||||
| Other comprehensive income (loss), net of tax | — | — | — | — | |||||||||||||||||||||||||||||||
| Stock compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Purchase of treasury stock | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Excise tax on stock repurchase | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Shares withheld related to net share settlement of equity awards | — | ( | — | — | — | ( | |||||||||||||||||||||||||||||
| Reissuance of treasury stock | — | ( | — | — | |||||||||||||||||||||||||||||||
| Balance at June 30, 2025 | $ | $ | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
9
BIO-RAD LABORATORIES, INC
Notes to Condensed Consolidated Financial Statements
(Unaudited)
1. BASIS OF PRESENTATION AND USE OF ESTIMATES
Basis of Presentation
In this report, “Bio-Rad,” “we,” “us,” “the Company” and “our” refer to Bio-Rad Laboratories, Inc. and its subsidiaries. The accompanying unaudited condensed consolidated financial statements of Bio-Rad have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and reflect all adjustments which are, in the opinion of management, necessary to fairly state the results of the interim periods presented. All such adjustments are of a normal recurring nature. Results for the interim period are not necessarily indicative of the results for the entire year. The condensed consolidated balance sheet at December 31, 2025 has been derived from the audited consolidated financial statements at that date but does not include all of the information and footnotes required by GAAP for complete financial statements. The condensed consolidated financial statements should be read in conjunction with the notes to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2025.
We evaluate subsequent events and the evidence they provide about conditions existing at the date of the balance sheet as well as conditions that arose after the balance sheet date but through the date the financial statements are issued. The effects of conditions that existed at the balance sheet date are recognized in the financial statements. Events and conditions arising after the balance sheet date but before the financial statements are issued are evaluated to determine if disclosure is required to keep the financial statements from being misleading. To the extent such events and conditions exist, disclosures are made regarding the nature of events and the estimated financial effects of those events and conditions.
Use of Estimates
The preparation of the condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingencies at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting periods. Bio-Rad bases its estimates on historical experience and on various other market-specific and other relevant assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Such estimates include, but are not limited to, revenue recognition, the valuation of inventory, the valuation of acquired intangible assets and goodwill, valuation of accounts receivable, estimation of warranty reserve, useful lives of intangible assets and property, plant and equipment, fair value of equity awards, estimation of legal reserves, the recognition and measurement of current and deferred income tax assets and fair value measurement of the Loan receivable and other financial instruments. Actual results could differ materially from those estimates.
Revenue Recognition
We recognize revenue from operations through the sale of products, services, license of intellectual property and rental of instruments. Revenue from contracts with customers is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. Revenue is recognized net of any taxes collected from customers (sales tax, value added tax, etc.), which are subsequently remitted to government authorities.
10
We enter into contracts that can include various combinations of products and services, which are generally accounted for as distinct performance obligations. A product or service is considered distinct if it is separately identifiable from other deliverables in the arrangement and if a customer can benefit from such product or service on its own or with other resources that are readily available to the customer. The transaction consideration is allocated between separate performance obligations of an arrangement based on the stand-alone selling price ("SSP") for each distinct product or service.
We recognize revenue from product sales at the point in time when we have satisfied our performance obligation by transferring control of the product to the customer. We use judgment to evaluate whether and when control has transferred and consider the right to payment, legal title, physical possession, risks and rewards of ownership, and customer acceptance if it is not a formality, as indicators to determine the transfer of control to the customer. For products that include installation, the product and installation are separate performance obligations. The product revenue is recognized when control has transferred to the customer, generally upon delivery, and installation service revenue is recognized when the product installation is completed.
Service revenues on extended warranty contracts are recognized ratably over the life of the service agreement as a stand-ready performance obligation. For arrangements that include a combination of products and services, the transaction price is allocated to each performance obligation based on SSP. The method used to determine the SSP for product and service revenues is based on the observable prices when the product or services have been sold separately.
We recognize revenues for a functional license of intellectual property at a point in time when the control of the license and technology transfers to the customer. For license agreements that include sales or usage-based royalty payments to us, we recognize revenue at the later of (i) when the related sale of the product occurs, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied, or partially satisfied.
The primary purpose of our invoicing terms is to provide customers with simple and predictable methods of purchasing our products and services, not to either provide or receive financing to or from our customers. We record contract liabilities when cash payments are received or due in advance of our performance.
We do not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. Our payment terms vary by the type and location of our customer, and the products and services offered. The term between invoicing and when payment is due is not significant.
In addition, we offer a reagent rental program which provides our customers the ability to use an instrument and consumables (reagents) on a per test basis. These agreements may also include maintenance of the instruments placed at customer locations as well as initial training. We initially determine if a reagent rental arrangement contains a lease at contract commencement. Where we have determined that such an arrangement contains a lease, we then determine the lease classification. Our reagent rental arrangements are predominantly classified as operating leases and any sales-type leases have historically been immaterial and we do not enter into direct finance leases.
We concluded that the use of the instrument (referred to as “lease elements”) in our reagent rental agreements is not governed by the revenue recognition guidance of ASC 606, Revenue from Contracts with Customers, but instead is addressed by the lease guidance in ASC 842, Leases. Accordingly, we first allocate the transaction price between the lease elements and the non-lease elements based on relative stand-alone selling prices. Our reagent rental arrangements are predominantly comprised of variable lease payments that fluctuate depending on the volume of reagents purchased, as such arrangements generally do not contain any fixed or minimum lease payments. Maintenance services and reagent sales are allocated to the non-lease elements and recognized as income over time as control is transferred. Maintenance services are recognized ratably over the period whereas reagent revenue is recognized upon transfer of control when either (i) the consumables are delivered or (ii) the consumables are consumed by the customer.
11
Revenue attributed to the lease elements of our reagent rental arrangements represented approximately 3
Contract costs:
As a practical expedient, we expense as incurred costs to obtain contracts as the amortization period would have been one year or less. These costs include our internal sales force and certain partner sales incentive programs and are recorded within Selling, general and administrative expense in our condensed consolidated statements of income (loss).
Disaggregation of Revenue:
The following table presents our revenues disaggregated by geographic region (in millions):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| United States | $ | $ | $ | $ | |||||||||||||||||||
| EMEA | |||||||||||||||||||||||
| APAC | |||||||||||||||||||||||
| Other (primarily Canada and Latin America) | |||||||||||||||||||||||
| Total net sales | $ | $ | $ | $ | |||||||||||||||||||
The disaggregation of our revenue by geographic region is based primarily on the location of the use of the product or service, and by industry segment sources. The disaggregation of our revenues by industry segment sources are presented in our Segment Information footnote (see Note 13).
Deferred revenues primarily represent unrecognized fees billed or collected for extended service arrangements, including installation services. The deferred revenue balance at June 30, 2026 and December 31, 2025 was $66.0 million and $62.9 million, respectively. The short-term deferred revenue balance at June 30, 2026 and December 31, 2025 was $52.5 million and $48.9 million, respectively. Deferred revenues are included in Other current liabilities and Other long-term liabilities in the condensed consolidated balance sheets.
We warrant certain equipment against defects in design, materials and workmanship, generally for a period of one year. We estimate the cost of warranties at the time the related revenue is recognized based on historical experience, specific warranty terms and customer feedback. These costs are recorded within Cost of goods sold in our condensed consolidated statements of income (loss).
Warranty liabilities are included in Other current liabilities and Other long-term liabilities in the condensed consolidated balance sheets. Changes in our warranty liability were as follows (in millions):
| Six Months Ended | |||||||||||
| June 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Balance at beginning of period | $ | $ | |||||||||
| Provision for warranty | |||||||||||
Actual warranty costs | ( | ( | |||||||||
| Balance at end of period | $ | $ | |||||||||
12
Accounts Receivable and Allowance for Credit Losses
We record trade accounts receivable at the net invoice value and such receivables are non-interest bearing. We consider receivables past due based on the contractual payment terms. Amounts later determined and specifically identified to be uncollectible are charged or written off against the allowance for credit losses.
Any adjustments made to our historical loss experience reflect current differences in asset-specific risk characteristics, including, for example, accounts receivable by customer type (public or government entity versus private entity) and by geographic location of customer.
Changes in our allowance for credit losses were as follows (in millions):
| Six Months Ended | |||||||||||
| June 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Balance at beginning of period | $ | $ | |||||||||
| Provision for expected credit losses | ( | ||||||||||
| Write-offs charged against the allowance | ( | ( | |||||||||
| Balance at end of period | $ | $ | |||||||||
Recent Accounting Pronouncements Adopted
In July 2025, the FASB issued ASU No. 2025-05, "Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets". The ASU allows a practical expedient election to simplify the expected credit loss estimation for accounts receivable and contract assets by assuming conditions as of the balance sheet date do not change for the remaining life of the asset. This ASU was effective for us beginning January 1, 2026 and its adoption did not have a material impact on our condensed consolidated financial statements.
Recent Accounting Pronouncements to be Adopted
In November 2024, the FASB issued ASU 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)". This ASU requires entities to disclose additional information about specific expense categories in the notes to financial statements. As clarified in ASU 2025-01, the guidance set forth in ASU 2024-03 is required to be adopted in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. We are currently evaluating the impact of these amendments on our condensed consolidated financial statement disclosures.
In September 2025, the FASB issued ASU 2025-06, "Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software". The ASU removes all references to prescriptive and sequential software development stages and instead requires companies to start capitalizing software costs when: (a) management has authorized and committed to funding the software project and (b) it is probable that the project will be completed and the software will be used to perform the function intended. The ASU is effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period. The ASU allows for adoption using a prospective transition approach, a modified transition approach or a retrospective transition approach. We are currently evaluating the impact of these amendments on our condensed consolidated financial statements and the method of adoption to be applied.
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In November 2025, the FASB issued ASU 2025-09, "Derivatives and Hedging (Topic 815): Hedge Accounting Improvements". The objective of this ASU is to more closely align hedge accounting with the economics of an entity’s risk management activities. The amendments are intended to better reflect those strategies in financial reporting by enabling entities to achieve and maintain hedge accounting for highly effective economic hedges of forecasted transactions. This ASU is effective for annual reporting periods beginning after December 15, 2026, and interim periods within those annual reporting periods. We are currently evaluating the impact of these amendments on our condensed consolidated financial statements.
In December 2025, the FASB issued ASU 2025-10, "Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities". The objective of this ASU is to establish a comprehensive framework for recognizing, measuring, and presenting government grants received by business entities. The amendments are intended to enhance consistency and transparency in financial reporting by providing clear guidance on how such grants should be accounted for within the financial statements. The amendments in this update are effective for annual reporting periods beginning after December 15, 2028, and interim reporting periods within those annual reporting periods. We are currently evaluating the impact of these amendments on our condensed consolidated financial statements.
In December 2025, the FASB issued ASU 2025‑11, “Interim Reporting (Topic 270): Narrow‑Scope Improvements”. The objective of this ASU is to enhance the clarity and usefulness of interim financial reporting by introducing targeted disclosure requirements designed to improve transparency for users of interim financial statements. The amendments are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. We are currently evaluating the impact of these amendments on our condensed consolidated financial statement disclosures.
In May 2026, the FASB issued ASU 2026‑02, “Environmental Credits and Environmental Credit Obligations (Topic 818)”. The objective of this ASU is to improve the financial accounting for and disclosure of environmental credits and related obligations by establishing specific recognition, measurement, presentation, and disclosure requirements, thereby reducing diversity in practice. The amendments apply to all entities that generate, purchase, or receive environmental credits or incur obligations that may be settled with such credits, and introduce different measurement approaches for compliance versus noncompliance credits, along with enhanced disclosure requirements. The amendments are effective for annual reporting periods beginning after December 15, 2027, and interim periods within those annual reporting periods. Early adoption is permitted. We are currently evaluating the impact of these amendments on our consolidated financial statements and related disclosures.
2. ACQUISITIONS
Stilla Technologies Acquisition
As previously disclosed in Footnote 2 in our Annual Report on Form 10-K for the year ended December 31, 2025, on June 30, 2025 (the "Acquisition Date"), we acquired all equity interests of Stilla Technologies ("Stilla") for a total consideration of $257.7 million, including the estimated fair value of contingent consideration. The contingent consideration of up to $50.0 million is payable upon the achievement of certain technological development and sales-related milestones. No conditions triggering payment of the contingent consideration were met as of June 30, 2026.
We finalized the purchase price allocation as of June 30, 2026, the end of the one-year measurement period. The final allocation reflects the effects of price adjustment escrow and warranty escrow made during the measurement period. The adjustments resulted in a $1.1 million decrease in goodwill and a $1.1 million decrease in purchase consideration compared to the preliminary amounts at December 31, 2025 and had no impact on our condensed consolidated statements of income (loss) for the three and six months ended June 30, 2026.
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3. FAIR VALUE MEASUREMENTS AND INVESTMENTS
We determine the fair value of an asset or liability based on the assumptions that market participants would use in pricing the asset or liability in an orderly transaction between market participants at the measurement date. The identification of market participant assumptions provides a basis for determining what inputs are to be used for pricing each asset or liability. A fair value hierarchy has been established which gives precedence to fair value measurements calculated using observable inputs over those using unobservable inputs. This hierarchy prioritizes the inputs into three broad levels as follows:
•Level 1: Quoted prices in active markets for identical instruments
•Level 2: Other significant observable inputs (including quoted prices in active markets for similar instruments)
•Level 3: Significant unobservable inputs (including assumptions in determining the fair value of certain investments)
Financial assets and liabilities carried at fair value and measured on a recurring basis as of June 30, 2026 are classified in the hierarchy as follows (in millions):
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Financial assets carried at fair value: | |||||||||||||||||||||||
| Cash equivalents: | |||||||||||||||||||||||
| Time deposits | |||||||||||||||||||||||
U.S. government sponsored agencies securities | |||||||||||||||||||||||
| Money market funds | |||||||||||||||||||||||
| Total cash equivalents (a) | |||||||||||||||||||||||
| Restricted investments (b) | |||||||||||||||||||||||
Equity securities (c) | |||||||||||||||||||||||
| Loan under the fair value option (d) | |||||||||||||||||||||||
| Available-for-sale investments: | |||||||||||||||||||||||
| Corporate debt securities | |||||||||||||||||||||||
U.S. government sponsored agencies securities | |||||||||||||||||||||||
| Foreign government obligations | |||||||||||||||||||||||
| Municipal obligations | |||||||||||||||||||||||
| Asset-backed securities | |||||||||||||||||||||||
| Total available-for-sale investments (e) | |||||||||||||||||||||||
| Forward foreign exchange contracts (f) | |||||||||||||||||||||||
| Total financial assets carried at fair value | $ | $ | $ | $ | |||||||||||||||||||
| Financial liabilities carried at fair value: | |||||||||||||||||||||||
| Forward foreign exchange contracts (g) | $ | $ | $ | $ | |||||||||||||||||||
| Contingent consideration (h) | |||||||||||||||||||||||
| Total financial liabilities carried at fair value | $ | $ | $ | $ | |||||||||||||||||||
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Financial assets and liabilities carried at fair value and measured on a recurring basis as of December 31, 2025 are classified in the hierarchy as follows (in millions):
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Financial assets carried at fair value: | |||||||||||||||||||||||
| Cash equivalents: | |||||||||||||||||||||||
| Corporate debt securities | $ | $ | $ | $ | |||||||||||||||||||
| Time deposits | |||||||||||||||||||||||
U.S. government sponsored agencies securities | |||||||||||||||||||||||
| Money market funds | |||||||||||||||||||||||
| Total cash equivalents (a) | |||||||||||||||||||||||
| Restricted investments (b) | |||||||||||||||||||||||
| Equity securities (c) | |||||||||||||||||||||||
| Loan under the fair value option (d) | |||||||||||||||||||||||
| Available-for-sale investments: | |||||||||||||||||||||||
| Corporate debt securities | |||||||||||||||||||||||
U.S. government sponsored agencies securities | |||||||||||||||||||||||
| Foreign government obligations | |||||||||||||||||||||||
| Municipal obligations | |||||||||||||||||||||||
| Asset-backed securities | |||||||||||||||||||||||
| Total available-for-sale investments (e) | |||||||||||||||||||||||
| Forward foreign exchange contracts (f) | |||||||||||||||||||||||
| Total financial assets carried at fair value | $ | $ | $ | $ | |||||||||||||||||||
| Financial liabilities carried at fair value: | |||||||||||||||||||||||
| Forward foreign exchange contracts (g) | $ | $ | $ | $ | |||||||||||||||||||
| Contingent consideration (h) | |||||||||||||||||||||||
| Total financial liabilities carried at fair value | $ | $ | $ | $ | |||||||||||||||||||
(a)Cash equivalents are included in Cash and cash equivalents in the condensed consolidated balance sheets.
(b) Restricted investments are included in Other investments in the condensed consolidated balance sheets.
(c) Equity securities are included in the following accounts in the condensed consolidated balance sheets (in millions):
| June 30, 2026 | December 31, 2025 | ||||||||||
| Short-term investments | $ | $ | |||||||||
| Other investments | |||||||||||
| Total | $ | $ | |||||||||
(d) The Loan under the fair value option is included in Other investments in the condensed consolidated balance sheets.
(e) Available-for-sale investments are included in Short-term investments in the condensed consolidated balance sheets.
(f) Forward foreign exchange contracts in an asset position are included in Other current assets in the condensed consolidated balance sheets.
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(g) Forward foreign exchange contracts in a liability position are included in Other current liabilities in the condensed consolidated balance sheets.
(h) Contingent consideration in a liability position is included in Other long-term liabilities in the condensed consolidated balance sheets. Changes in the estimated fair value of the contingent consideration are included in Research and development expense for the technological milestone and Selling, general and administrative expense for the sales-related milestone.
Level 1 Fair Value Measurements
As of June 30, 2026, we owned 12,987,900 ordinary voting shares and 9,588,908 preference shares of Sartorius AG ("Sartorius"), of Goettingen, Germany, a process technology supplier to the biotechnology, pharmaceutical, chemical and food and beverage industries. We owned approximately 38 % of the outstanding ordinary shares (excluding treasury shares) and 28 % of the preference shares of Sartorius as of June 30, 2026. The Sartorius family trust (Sartorius family members are beneficiaries of the trust) holds a majority interest of the outstanding ordinary shares of Sartorius. We do not have the ability to exercise significant influence over the operating and financial policies of Sartorius primarily because we do not have any representative or designee on Sartorius' board of directors and have tried and failed to obtain access to operating or financial information necessary to apply the equity method of accounting.
The change in fair market value of our investment in Sartorius for the three and six months ended June 30, 2026 was a gain of $430.0 million and a loss of $297.7 million respectively, and is recorded in our condensed consolidated statements of income (loss).
Level 2 Fair Value Measurements
To estimate the fair value of Level 2 debt securities as of June 30, 2026 and December 31, 2025, pricing is obtained from third‑party pricing services as the primary pricing source. Our pricing process incorporates a hierarchy of pricing sources for securities held. If a Level 2 security is not priced by the primary pricing source, pricing from our custodian is used as a secondary source.
Available-for-sale investments consist of the following (in millions):
| June 30, 2026 | ||||||||||||||||||||||||||
Amortized Cost | Unrealized Gains | Unrealized Losses | Estimated Fair Value | |||||||||||||||||||||||
| Short-term investments: | ||||||||||||||||||||||||||
| Corporate debt securities | $ | $ | $ | ( | $ | |||||||||||||||||||||
U.S. government sponsored agencies securities | ( | |||||||||||||||||||||||||
| Foreign government obligations | ||||||||||||||||||||||||||
| Municipal obligations | ( | |||||||||||||||||||||||||
| Asset-backed securities | ( | |||||||||||||||||||||||||
Total | $ | $ | $ | ( | $ | |||||||||||||||||||||
The following is a summary of the amortized cost and estimated fair value of our debt securities at June 30, 2026 by contractual maturity date (in millions):
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Amortized Cost | Estimated Fair Value | ||||||||||
| Mature in less than one year | $ | $ | |||||||||
| Mature in one to five years | |||||||||||
| Mature in more than five years | |||||||||||
| Total | $ | $ | |||||||||
Available-for-sale investments consist of the following (in millions):
| December 31, 2025 | ||||||||||||||||||||||||||
Amortized Cost | Unrealized Gains | Unrealized Losses | Estimated Fair Value | |||||||||||||||||||||||
| Short-term investments: | ||||||||||||||||||||||||||
| Corporate debt securities | $ | $ | $ | ( | $ | |||||||||||||||||||||
U.S. government sponsored agencies securities | ||||||||||||||||||||||||||
| Foreign government obligations | ||||||||||||||||||||||||||
| Municipal obligations | ||||||||||||||||||||||||||
| Asset-backed securities | ( | |||||||||||||||||||||||||
| Total | $ | $ | $ | ( | $ | |||||||||||||||||||||
As of June 30, 2026, there were no significant continuous unrealized losses greater than 12 months.
Our evaluation of credit losses for available-for-sale investments included the extent to which the fair value is less than the amortized cost basis, adverse conditions specifically related to the debt security, an industry or geographic area, and any changes in the rating of a security by a rating agency. Credit loss impairments are limited to the amount that the fair value of an instrument is less than its amortized cost basis.
At June 30, 2026, we concluded that all payments related to our available-for-sale investments are expected to be made in full and on time at par value. The diminution of value in the intervening period is due to market conditions such as illiquidity and interest rate movements and not due to significant, inherent credit concerns surrounding the issuer. As a result, we have no allowances for credit losses on our available-for-sale investments portfolio as of June 30, 2026.
Included in Other current assets are $8.9 million and $11.9 million of interest receivable as of June 30, 2026 and December 31, 2025, respectively, primarily associated with securities in our available-for-sale investments portfolio. Associated interest on these securities is typically payable semi-annually. Due to the short-term nature of our interest receivable asset, we have made an accounting policy election not to measure an allowance for credit losses for accrued interest receivable. We consider any uncollected interest receivable that is overdue greater than one year to be impaired for purposes of write-off. For the three and six months ended June 30, 2026, we have not written-off any uncollected interest receivable.
We enter into forward foreign exchange contracts to manage foreign exchange risk arising from movements in foreign exchange rates that affect foreign currency denominated cash, account receivables and payables. We do not use derivative financial instruments for speculative or trading purposes. We do not seek hedge accounting treatment for these balance sheet hedge contracts. As a result, these contracts, generally with maturity dates of 90 days or less, are recorded at their fair value at each balance sheet date. The resulting gains or losses from foreign exchange contracts are expected to offset remeasurement losses or gains from foreign currency exposures being hedged, both of which are included in Foreign currency exchange (gains) losses, net in the condensed consolidated statements of income (loss).
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We also enter into forward foreign exchange contracts to hedge certain anticipated foreign currency denominated revenues and expenses. These contracts are designated as cash flow hedges, generally mature within 12 months and no later than 18 months, and are carried at fair value at each balance sheet date. Unrealized gains and losses on the effective portion are recorded in accumulated other comprehensive income (loss) and reclassified into earnings in the period the hedged item affects earnings. Any ineffective portion is immediately recorded in earnings.
The estimated fair value of forward foreign exchange contracts was determined using spot exchange rates and forward points as of the last business day of the quarter. The following is a summary of our forward foreign exchange contracts (in millions):
Contracts maturing to sell foreign currency in the next 12 months: | June 30, 2026 | ||||
| Notional value | $ | ||||
| Unrealized gain (loss) | $ | ( | |||
Contracts maturing to purchase foreign currency in the next 12 months: | |||||
| Notional value | $ | ||||
| Unrealized gain (loss) | $ | ( | |||
Included in Other investments in the condensed consolidated balance sheet are investments without readily determinable fair value measured at cost with adjustments for observable price changes or impairments. The carrying value of these investments was $23.7 million and $23.0 million as of June 30, 2026 and December 31, 2025, respectively.
Also included in Other investments in the condensed consolidated balance sheet are our equity method investments, for which our share of the equity method investees earnings is included in Other income, net in our condensed consolidated statements of income (loss). The carrying value of these investments, net of impairments, was $33.9 million and $36.9 million as of June 30, 2026 and December 31, 2025, respectively.
The carrying value and fair value of our long-term debt, including current maturities, were as follows (in millions):
| June 30, 2026 | December 31, 2025 | |||||||||||||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||||||||||||
Senior notes | $ | $ | $ | $ | ||||||||||||||||||||||
Other long-term debt | ||||||||||||||||||||||||||
Total | $ | $ | $ | $ | ||||||||||||||||||||||
The fair value of our long-term debt, including current maturities, was determined based on quoted market prices and on borrowing rates available to the Company at the respective period ends, which represent level 2 measurements.
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Level 3 Fair Value Investments
During the fourth quarter of 2021, we extended a collateralized loan to Sartorius-Herbst Beteiligungen II GmbH ("SHB"), a private limited company incorporated under the laws of Germany, with a principal amount of €400 million due on January 31, 2029, subject to certain events which could trigger payment prior to maturity (“Loan”). SHB used the Loan proceeds to partially finance the acquisition of interests under the Sartorius family trust (“Trust”) from a beneficiary of the Trust. The Loan is collateralized by the pledge of certain of the Trust interests, which upon termination of the Trust in mid-2028 represent the right to receive Sartorius ordinary shares. Interest on the loan is payable annually in arrears at 1.5 % per annum, and the entire principal amount is due at maturity. In addition to contractual interest, we are entitled to certain value appreciation rights associated with the acquired Trust interests, which upon termination of the Trust represent the right to receive Sartorius ordinary shares, that is due upon repayment of the Loan. We elected the fair value option under ASC 825, Financial Instruments for accounting of the Loan to SHB to simplify the accounting. The fair value of the Loan and value appreciation right is estimated under the income approach using a discounted cash flow, and option pricing model, respectively, which results in a fair value measurement categorized in Level 3. The significant assumptions used to estimate fair value of the Loan include an estimate of the discount rate and cash flows of the Loan and the significant assumptions used to estimate the fair value of the value appreciation right include volatility, the risk-free interest rate, expected life (in years) and expected dividend. The inputs are subject to estimation uncertainty and actual amounts realized may materially differ. An increase in the expected volatility may result in a significantly higher fair value, whereas a decrease in expected life may result in a significantly lower fair value. All subsequent changes in fair value of the Loan and value appreciation right, including accrued interest are recognized in (Gains) losses from change in fair market value of equity securities and loan receivable in our condensed consolidated statements of income (loss). The overall change in fair market value reflected in (Gains) losses from change in fair market value of equity securities and loan receivable during the three months ended June 30, 2026 was a gain of $15.1 million, which includes a $13.2 million gain from change in fair market value of the Loan and a $1.9 million gain from change in fair market value of the value appreciation right. The overall change in fair market value reflected in (Gains) losses from change in fair market value of equity securities and loan receivable during the six months ended June 30, 2026 was a gain of $6.7 million, which includes a $9.4 million gain from change in fair market value of the Loan and a $2.7 million loss from change in fair market value of the value appreciation right. The increase in the fair market value of the loan receivables was due to a closer maturity date and lower discount rate. As of June 30, 2026, the €400 million principal amount of the loan is still due on January 31, 2029.
The following table provides a reconciliation of the Level 3 Loan measured at estimated fair value (in millions):
| Balance as of December 31, 2025 | $ | ||||
| Change in estimated fair market value, net | |||||
| Foreign currency exchange gains (losses), net | ( | ||||
| Balance as of June 30, 2026 | $ | ||||
During the second quarter of 2025, we recognized a contingent consideration liability upon our acquisition of Stilla, which represents future potential payments of up to $50.0 million, payable in cash upon the achievement of certain technological and sales-related milestones, commencing on June 30, 2025 through December 31, 2026 and 2027, respectively. At the Acquisition Date, the fair value of the contingent consideration of $28.5 million was determined by using a probability-weighted expected return model for both the achievement of the technological and sales-related milestones. The significant assumptions used to estimate the fair value of the contingent consideration include an estimate of the probability of achievement and the discount rate. The probability of achievement is subject to estimation uncertainty and actual amounts realized may materially differ. An increase in the expected probability of achievement may result in a higher fair value, whereas a decrease in expected probability of achievement may result in a lower fair value. The fair value of the contingent consideration is remeasured at each reporting period based on the assumptions and inputs on the date of remeasurement. The fair value of the estimated contingent consideration was $30.1 million as of June 30, 2026.
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The following table provides a reconciliation of the Level 3 Stilla contingent consideration liability in the aggregate measured at estimated fair value (in millions):
| Balance as of December 31, 2025 | $ | ||||
Change in estimated fair value | |||||
| Balance as of June 30, 2026 | $ | ||||
The following table provides quantitative information about Level 3 inputs for fair value measurement of our Stilla contingent consideration liability as of June 30, 2026. Significant increases or decreases in these inputs in isolation could result in a significantly lower or higher fair value measurement.
| Valuation Technique | Unobservable Input | Percentage | |||||||||
Stilla | Probability-weighted expected return model | Discount rate | % | ||||||||
4. GOODWILL AND OTHER PURCHASED INTANGIBLE ASSETS
Changes to goodwill by segment were as follows (in millions):
Life Science | Clinical Diagnostics | Total | |||||||||||||||
| Balances as of December 31, 2025 | |||||||||||||||||
| Goodwill | $ | $ | $ | ||||||||||||||
| Accumulated impairment losses | ( | ( | ( | ||||||||||||||
| Goodwill, net | |||||||||||||||||
| Acquisition adjustments | ( | ( | |||||||||||||||
| Foreign currency adjustments | ( | ( | |||||||||||||||
Period change, net | ( | ( | |||||||||||||||
| Balances as of June 30, 2026 | |||||||||||||||||
| Goodwill | |||||||||||||||||
| Accumulated impairment losses | ( | ( | ( | ||||||||||||||
| Goodwill, net | $ | $ | $ | ||||||||||||||
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Information regarding our identifiable purchased intangible assets with finite and indefinite lives is as follows (in millions):
| June 30, 2026 | |||||||||||||||||||||||
Weighted-Average Amortization Period (in years) | Purchase Price | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||||
| Customer relationships/lists | $ | $ | ( | $ | |||||||||||||||||||
| Developed product technology | ( | ||||||||||||||||||||||
| Licenses | ( | ||||||||||||||||||||||
| Tradenames | ( | ||||||||||||||||||||||
| Covenants not to compete | — | ( | |||||||||||||||||||||
| Total purchased intangible assets | $ | $ | ( | $ | |||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||
Weighted-Average Amortization Period (in years) | Purchase Price | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||||
| Customer relationships/lists | $ | $ | ( | $ | |||||||||||||||||||
| Developed product technology | ( | ||||||||||||||||||||||
| Licenses | ( | ||||||||||||||||||||||
| Tradenames | ( | ||||||||||||||||||||||
| Covenants not to compete | ( | ||||||||||||||||||||||
| Total purchased intangible assets | $ | $ | ( | $ | |||||||||||||||||||
Amortization expense related to purchased intangible assets was as follows (in millions):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Amortization expense | $ | $ | $ | $ | |||||||||||||||||||
5. INVENTORY
Following are the components of Inventory at June 30, 2026 and December 31, 2025 (in millions):
| June 30, 2026 | December 31, 2025 | ||||||||||
| Raw materials | $ | $ | |||||||||
| Work in process | |||||||||||
| Finished goods | |||||||||||
| Total Inventory | $ | $ | |||||||||
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6. LONG-TERM DEBT
The principal components of long-term debt are as follows (in millions):
| June 30, 2026 | December 31, 2025 | ||||||||||
| $ | $ | ||||||||||
| Less unamortized discounts and debt issuance costs | ( | ( | |||||||||
| Long-term debt less unamortized discounts and debt issuance costs | |||||||||||
| Finance leases and other debt | |||||||||||
| Less current maturities | ( | ( | |||||||||
| Long-term debt | $ | $ | |||||||||
7. INCOME TAXES
Our effective income tax rate was 31.5 % and 23.2 % for the three months ended June 30, 2026 and 2025, respectively and (5.4 )% and 23.2 % for the six months ended June 30, 2026 and 2025, respectively.
The realization of deferred tax assets are dependent upon the generation of sufficient taxable income of the appropriate character in future periods. We regularly assess our ability to realize our deferred tax assets and establish a valuation allowance if it is more likely than not that some portion, or all, of our deferred tax assets will not be realized. In assessing the realizability of our deferred tax assets, we weigh all available positive and negative evidence. Due to the weight of objectively verifiable negative evidence, we believe that it is more likely than not that certain of our federal, state and foreign deferred tax assets will not be realized as of June 30, 2026, and have maintained a valuation allowance on such deferred tax assets. The valuation allowance against our federal, state and foreign deferred tax assets decreased by $6.9 million for the period ended June 30, 2026 compared to the year ended December 31, 2025.
Our income tax returns are audited by U.S. federal, state and foreign tax authorities. We are currently under examination by many of these tax authorities. The tax years open to examination include the years 2012 and forward for the U.S. and certain foreign jurisdictions including France, Germany, India and Switzerland. There are differing interpretations of tax laws and regulations, and as a result, significant disputes may arise with these tax authorities involving issues of the timing and amount of deductions and allocations of income among various tax jurisdictions. We evaluate our exposures associated with our tax filing positions on a quarterly basis.
We record liabilities for unrecognized tax benefits related to uncertain tax positions. We do not believe any currently pending uncertain tax positions will have a material adverse effect on our condensed consolidated financial statements, although an adverse resolution of one or more of these uncertain tax positions in any period may have a material impact on the results of operations for that period.
Our gross unrecognized tax benefits were $88.9 million and $86.9 million as of June 30, 2026 and December 31, 2025, respectively. The increase in our gross unrecognized tax benefits is primarily attributable to an increase of uncertain tax accruals in various jurisdictions.
8. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
Accumulated other comprehensive income (loss) included in our condensed consolidated balance sheets and condensed consolidated statements of changes in stockholders' equity consists of the following components (in millions):
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| Foreign currency translation adjustments | Foreign other post-employment benefits adjustments | Net unrealized holding gains (losses) on available-for-sale investments | Net unrealized holding gains (losses) on cash flow hedge | Total accumulated other comprehensive income (loss) | |||||||||||||
| Balances as of December 31, 2025 | $ | ( | $ | $ | $ | $ | ( | ||||||||||
| Other comprehensive income (loss), before reclassifications | ( | ( | ( | ( | |||||||||||||
| Amounts reclassified from accumulated other comprehensive income (loss) | ( | ( | ( | ||||||||||||||
| Income tax effects | |||||||||||||||||
| Other comprehensive income (loss), net of income taxes | ( | ( | ( | ( | |||||||||||||
| Balances as of June 30, 2026 | $ | ( | $ | $ | $ | $ | ( | ||||||||||
| Foreign currency translation adjustments | Foreign other post-employment benefits adjustments | Net unrealized holding gains (losses) on available-for-sale investments | Total accumulated other comprehensive income (loss) | |||||||||||
| Balances as of December 31, 2024 | $ | ( | $ | ( | $ | $ | ( | |||||||
| Other comprehensive income (loss), before reclassifications | ||||||||||||||
| Amounts reclassified from accumulated other comprehensive income (loss) | ( | ( | ( | |||||||||||
| Income tax effects | ( | ( | ( | ( | ||||||||||
| Other comprehensive income (loss), net of income taxes | ( | |||||||||||||
| Balances as of June 30, 2025 | $ | ( | $ | ( | $ | $ | ( | |||||||
All amounts reclassified out of accumulated other comprehensive income (loss) were reclassified into Other income, net in the condensed consolidated statements of income (loss). Reclassification adjustments are calculated using the specific identification method.
The impact to income (loss) before income taxes for amounts reclassified out of accumulated other comprehensive income (loss) into Other income, net in the condensed consolidated statements of income (loss) were as follows (in millions):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||||
| Components of comprehensive income (loss) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Amortization of foreign other post-employment benefit items | $ | $ | $ | $ | |||||||||||||||||||
Net holding gains on equity securities and available-for-sale investments | $ | $ | $ | $ | |||||||||||||||||||
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9. OTHER INCOME, NET
Other income, net includes the following components (in millions):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Interest and investment income | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Net realized (gains) losses on investments | ( | ( | ( | ( | |||||||||||||||||||
| Other income | ( | ( | ( | ( | |||||||||||||||||||
| Other income, net | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
10. EARNINGS (LOSS) PER SHARE
Bio-Rad’s issued and outstanding stock consists of Class A Common Stock ("Class A") and Class B Common Stock ("Class B"). Each share of Class A and Class B common stock participates equally in the earnings and losses of Bio-Rad, and each share is identical to the next in all respects except as follows. Class A common stock has limited voting rights compared to Class B. Each share of Class A is entitled to one tenth of a vote on most matters, whereas each share of Class B is always entitled to one vote. Additionally, Class A stockholders are entitled to elect 25 % of the directors, with Class B stockholders electing the remaining directors. Cash dividends may be paid on Class A shares without paying a cash dividend on Class B shares. In contrast, no cash dividend may be paid on Class B shares unless at least an equal cash dividend is paid on Class A shares. Class B shares are convertible at any time into Class A shares on a one-for-one basis at the option of the stockholder.
We compute Net income (loss) per share of Class A and Class B using the two-class method. Each share of Class A and Class B participates equally in earnings and losses, but may not participate equally in dividend distributions. No dividends were distributed or declared during any of the periods presented. Earnings (loss) is attributable equally to each share of Class A and Class B common stock and is determined based on the weighted average number of the respective class of common stock outstanding for the three and six months ended June 30, 2026 and 2025.
Accordingly, Basic earnings (loss) per share is computed by dividing Net income (loss) attributable to Bio-Rad by the weighted average number of common shares outstanding for that period. Diluted earnings (loss) per share takes into account the effect of dilutive instruments, such as stock options, restricted stock and performance stock, and uses the average share price for the period in determining the number of potential common shares that are to be added to the weighted average number of shares outstanding. Potential common shares are excluded from the Diluted earnings (loss) per share calculation if the effect of including such securities would be anti-dilutive.
The weighted average number of common shares outstanding used to calculate basic and diluted earnings (loss) per share, and the anti-dilutive shares that are excluded from the diluted earnings (loss) per share calculation are as follows (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
Basic weighted average common shares outstanding | |||||||||||||||||||||||
| Effect of potentially dilutive stock options, restricted stock and performance stock awards | |||||||||||||||||||||||
| Diluted weighted average common shares outstanding | |||||||||||||||||||||||
| Anti-dilutive shares | |||||||||||||||||||||||
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11. SUPPLEMENTAL CASH FLOW INFORMATION
The reconciliation of net income (loss) to net cash provided by operating activities is as follows (in millions):
| Six Months Ended | |||||||||||
| June 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Net income (loss) | $ | ( | $ | ||||||||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Reduction in the carrying amount of right-of-use assets | |||||||||||
| Share-based compensation | |||||||||||
| (Gains) losses from change in fair market value of equity securities and loan receivable | ( | ||||||||||
| Payments for operating lease liabilities | ( | ( | |||||||||
| Decrease in accounts receivable | |||||||||||
| (Increase) decrease in inventories | ( | ||||||||||
| (Increase) decrease in other current assets | ( | ||||||||||
| Increase in accounts payable and other current liabilities | |||||||||||
| Increase (decrease) in income taxes payable | ( | ||||||||||
| Increase (decrease) in deferred income taxes | ( | ||||||||||
| Increase in other long-term liabilities | |||||||||||
| Other | |||||||||||
| Net cash provided by operating activities | $ | $ | |||||||||
| Non-cash investing activities: | |||||||||||
| Purchased property, plant and equipment | $ | $ | |||||||||
| Purchased marketable securities and investments | $ | $ | |||||||||
| Sold marketable securities and investments | $ | $ | |||||||||
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12. LEGAL PROCEEDINGS
13. SEGMENT INFORMATION
Information regarding industry segments at June 30, 2026 and 2025 and for the three months then ended are as follows (in millions):
| Life Science | Clinical Diagnostics | |||||||||||||||||||
| Net sales | 2026 | $ | $ | |||||||||||||||||
| 2025 | $ | $ | ||||||||||||||||||
Cost of goods sold | 2026 | $ | $ | |||||||||||||||||
| 2025 | $ | $ | ||||||||||||||||||
| Segment gross profit | 2026 | $ | $ | |||||||||||||||||
| 2025 | $ | $ | ||||||||||||||||||
Depreciation and amortization | 2026 | $ | $ | |||||||||||||||||
| 2025 | $ | $ | ||||||||||||||||||
Segment assets | 2026 | $ | $ | |||||||||||||||||
| 2025 | $ | $ | ||||||||||||||||||
Information regarding industry segments at June 30, 2026 and 2025 and for the six months then ended are as follows (in millions):
| Life Science | Clinical Diagnostics | |||||||||||||||||||
| Net sales | 2026 | $ | $ | |||||||||||||||||
| 2025 | $ | $ | ||||||||||||||||||
Cost of goods sold | 2026 | $ | $ | |||||||||||||||||
| 2025 | $ | $ | ||||||||||||||||||
Segment gross profit | 2026 | $ | $ | |||||||||||||||||
| 2025 | $ | $ | ||||||||||||||||||
Depreciation and amortization | 2026 | $ | $ | |||||||||||||||||
| 2025 | $ | $ | ||||||||||||||||||
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Segment results are presented in the same manner as we present our operations internally to make operating decisions and assess performance. The segment measure of profit and loss used by our chief operating decision maker ("CODM") is Gross Profit, which represents Net sales reduced by Cost of goods sold, and is the primary measure used by the CODM to evaluate segment performance and allocate resources.
The following reconciles total segment gross profit to net income (loss) before income taxes (in millions):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Segment gross profit | $ | $ | $ | $ | |||||||||||||||||||
Selling, general and administrative expense | ( | ( | ( | ( | |||||||||||||||||||
Research and development expense | ( | ( | ( | ( | |||||||||||||||||||
| Interest expense | ( | ( | ( | ( | |||||||||||||||||||
| Foreign currency exchange gains (losses), net | ( | ||||||||||||||||||||||
| Gains (losses) from change in fair market value of equity securities and loan receivable | ( | ||||||||||||||||||||||
| Other income, net | |||||||||||||||||||||||
| Net income (loss) before income taxes | $ | $ | $ | ( | $ | ||||||||||||||||||
14. LEASES
We have operating leases and to a lesser extent finance leases, for buildings, vehicles and equipment. Our leases have remaining lease terms of 1 year to 13 years, which includes our determination to exercise renewal options.
We determine if an arrangement is a lease at inception. Operating leases are included in Operating lease right-of-use (“ROU”) assets, Current operating lease liabilities, and Operating lease liabilities in our condensed consolidated balance sheets. Finance leases are included in Property, plant and equipment, net, Current maturities of long-term debt and notes payable, and Long-term debt, net of current maturities in our condensed consolidated balance sheets.
ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. Operating lease ROU assets also include any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease. For purposes of determining the lease term used in the measurement of operating lease ROU assets and operating lease liabilities, we include the noncancellable period of the lease together with those periods covered by the option to extend the lease if we are reasonably certain to exercise that option, the periods covered by an option to terminate the lease if we are reasonably certain not to exercise that option, and the periods covered by the option to extend (or to not terminate) the lease in which exercise of the option is controlled by the lessor. Lease expense is recognized on a straight-line basis over the lease term. Where we act as lessee, we elected not to separate lease and non-lease components.
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The components of lease expense were as follows (in millions):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Operating lease cost | $ | $ | $ | $ | |||||||||||||||||||
| Finance lease cost: | |||||||||||||||||||||||
| Amortization of right-of-use assets | $ | $ | $ | $ | |||||||||||||||||||
| Interest on lease liabilities | |||||||||||||||||||||||
| Total finance lease cost | $ | $ | $ | $ | |||||||||||||||||||
Operating lease cost includes original reduction in the carrying amount of ROU assets, the impact of remeasurements, modifications, impairments and abandonments.
Our short-term leases are expensed as incurred, reflecting leases with a lease term of one year or less, and are not significant for the three and six months ended June 30, 2026 and 2025. Operating lease variable cost is primarily comprised of reimbursed actual common area maintenance, property taxes and insurance, which are immaterial for the three and six months ended June 30, 2026 and 2025.
Supplemental cash flow information related to leases was as follows (in millions):
| Three Months Ended | Six Months Ended | ||||||||||||||||
| June 30, | June 30, | ||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||
| Cash paid for amounts included in the measurement of lease liabilities: | |||||||||||||||||
| Operating cash flows from operating leases | $ | $ | $ | $ | |||||||||||||
| Operating cash flows from finance leases | $ | $ | $ | $ | |||||||||||||
| Financing cash flows from finance leases | $ | $ | $ | $ | |||||||||||||
| Right-of-use assets obtained in exchange for new lease obligations: | |||||||||||||||||
| Operating leases | $ | $ | $ | $ | |||||||||||||
Supplemental balance sheet information related to leases was as follows (in millions):
| June 30, 2026 | December 31, 2025 | ||||||||||
| Operating Leases | |||||||||||
| Operating lease right-of-use assets | $ | $ | |||||||||
| Current operating lease liabilities | $ | $ | |||||||||
| Operating lease liabilities | |||||||||||
| Total operating lease liabilities | $ | $ | |||||||||
Finance leases are included in Property, plant and equipment, net, Current maturities of long-term debt and notes payable, and Long-term debt, net of current maturities.
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| June 30, 2026 | December 31, 2025 | ||||||||||
| Finance Leases | |||||||||||
| Property, plant and equipment, gross | $ | $ | |||||||||
| Less: accumulated depreciation and amortization | ( | ( | |||||||||
| Property, plant and equipment, net | $ | $ | |||||||||
| Current maturities of long-term debt and notes payable | $ | $ | |||||||||
| Long-term debt, net of current maturities | |||||||||||
| Total finance lease liabilities | $ | $ | |||||||||
| June 30, 2026 | December 31, 2025 | ||||||||||
| Weighted Average Remaining Lease Term | |||||||||||
| Operating leases - in years | |||||||||||
| Finance leases - in years | |||||||||||
| Weighted Average Discount Rate | |||||||||||
| Operating leases | % | % | |||||||||
| Finance leases | % | % | |||||||||
Maturities of lease liabilities were as follows (in millions):
| Year Ending December 31, | Operating Leases | Finance Leases | |||||||||
2026 (excluding the six months ended June 30, 2026) | $ | $ | |||||||||
| 2027 | |||||||||||
| 2028 | |||||||||||
| 2029 | |||||||||||
| 2030 | |||||||||||
| Thereafter | |||||||||||
| Total lease payments | |||||||||||
| Less imputed interest | ( | ( | |||||||||
| Total | $ | $ | |||||||||
Our operating lease portfolio primarily consists of facility leases, which generally have longer terms and represent the majority of its value. The remainder relates to vehicles and other equipment, which typically have shorter lease durations and higher turnover.
As of June 30, 2026, operating leases that have not commenced are not material.
15. SUBSEQUENT EVENTS
On July 31, 2026, we initiated a strategy-driven restructuring plan as part of the Company's ongoing program to improve operating performance and strengthen our competitive position. The restructuring plan impacts our operations and functions throughout the world and includes the elimination of certain positions, the consolidation of certain functions, and the closure of various facilities. We estimate that we will incur total pre-tax charges of approximately $80 to $90 million, which we anticipate will consist primarily of one-time termination benefits, including cash severance payments, healthcare benefits, and related transition assistance. The estimates for headcount reduction, timing and charges in certain areas of the international business are subject to completion of applicable local employee consultative processes. The restructuring plan is expected to be substantially completed by the end of fiscal year 2027.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This discussion should be read in conjunction with the information contained in both our consolidated financial statements for the year ended December 31, 2025 and the condensed consolidated financial statements for the three and six months ended June 30, 2026.
Overview. We are a multinational developer, manufacturer and worldwide distributor of our own life science research and clinical diagnostics products. Our business is organized into two reportable segments: Life Science and Clinical Diagnostics, with the mission to provide scientists with specialized tools needed for biological research and health care specialists with products needed for clinical diagnostics.
We sell more than 12,000 products and services to a diverse client base comprised of scientific research, healthcare, education and government customers worldwide. We do not disclose quantitative information about our different products and services as it is impractical to do so based primarily on the numerous products and services that we sell and the global markets that we serve.
We manufacture and supply our customers with a range of reagents, apparatus and equipment to separate complex chemical and biological materials and to identify, analyze and purify components. As our customers require standardization for their experiments and test results, much of our revenues are recurring in nature.
Approximately 39% of our 2026 consolidated net sales are derived from the United States and approximately 61% are derived from international locations, with Europe being our largest international region. The international sales are largely denominated in local currencies such as the Euro, Swiss Franc, Japanese Yen, Chinese Yuan and British Sterling. As a result, our consolidated net sales expressed in dollars benefit when the U.S. dollar weakens and suffer when the U.S. dollar strengthens. When the U.S. dollar strengthens, we benefit from lower cost of sales from our own international manufacturing sites, and from lower international operating expenses. We regularly discuss our changes in revenue and expense categories in terms of both changing foreign exchange rates and in terms of a currency-neutral basis, if notable, to explain the impact currency has on our results.
We rely on the support of many governments for both research and healthcare. Current global economic and geopolitical conditions remain uncertain, and the need for governments to control their spending, along with ongoing challenges among small biotech companies, continues to limit opportunities for growth and negatively impact our business. The market in China, which represents a mid-single digit percentage of our year-to-date 2026 consolidated net sales, remains uncertain as a result of these factors. We expect these conditions to continue through the rest of 2026.
Additionally, the recent escalation of regional conflicts in the Middle East has adversely affected demand and logistics in the EMEA region, particularly within our Clinical Diagnostics segment. These disruptions impacted our results during the first half of 2026 and, given the continued uncertainty regarding the duration and scope of the conflict, we expect these conditions to continue to adversely affect the EMEA region for the remainder of 2026.
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Results of Operations
The following table shows Cost of goods sold, Gross profit, components of operating expense, (Gains) losses from change in fair market value of equity securities and loan receivable, and Net income (loss) as a percentage of Net sales:
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Net sales | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||||||
| Cost of goods sold | 46.9 | 47.0 | 47.3 | 47.3 | |||||||||||||||||||
| Gross profit | 53.1 | 53.0 | 52.7 | 52.7 | |||||||||||||||||||
| Selling, general and administrative expense | 32.6 | 31.9 | 34.1 | 33.7 | |||||||||||||||||||
| Research and development expense | 9.4 | 9.3 | 10.0 | 10.8 | |||||||||||||||||||
| (Gains) losses from change in fair market value of equity securities and loan receivable | (70.4) | (51.3) | 22.5 | (29.6) | |||||||||||||||||||
| Net income (loss) | 57.1 | 48.8 | (12.5) | 30.9 | |||||||||||||||||||
Critical Accounting Policies and Estimates
An accounting policy is deemed to be critical if it affects our financial statements materially and requires subjective or complex judgments by management. An accounting estimate is deemed to be critical if it requires assumptions about matters that are highly uncertain at the time the estimate is made, if different estimates reasonably could have been used, or if changes in the estimate that are reasonably likely to occur could materially impact the financial statements. Management believes that there have been no significant changes during the three and six months ended June 30, 2026 to the items that we disclosed as our critical accounting policies and estimates in Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.
Three Months Ended June 30, 2026 Compared to
Three Months Ended June 30, 2025
Results of Operations – Sales, Gross Margins and Expenses
Percentage sales growth in currency-neutral amounts are calculated by translating prior period sales in each local currency using the current period monthly average foreign exchange rates for that currency and comparing that to current period sales.
Net sales ("sales") for the second quarter of 2026 were $651.0 million compared to $651.6 million in the second quarter of 2025, essentially flat. On a currency-neutral basis, second quarter 2026 sales decreased approximately 1.9% compared to the same period in 2025. The decrease in sales was driven by lower sales in Life Science segment.
The Life Science segment sales for the second quarter of 2026 were $252.0 million, a decrease of 4.1% compared to the same period in 2025. On a currency-neutral basis, sales decreased 5.1% compared to the second quarter in 2025, primarily driven by ongoing challenges in the academic research market. Currency-neutral sales decreased in the Americas and Asia Pacific, partially offset by increased sales in EMEA.
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The Clinical Diagnostics segment sales for the second quarter of 2026 were $399.0 million, an increase of 2.6% compared to the same period in 2025. On a currency-neutral basis, sales increased 0.3% compared to the second quarter in 2025, primarily driven by growth in quality systems, diabetes and blood typing products, partially offset by lower sales of infectious disease products. Currency-neutral sales increased in the Americas, partially offset by decreased sales in Asia Pacific.
Consolidated gross margin was 53.1% for the second quarter of 2026 compared to 53.0% for the second quarter of 2025. Gross margin for the Life Science segment for the second quarter of 2026 increased modestly by approximately 0.5 percentage points as compared to the same period in 2025. Gross margin for the Clinical Diagnostics segment for the second quarter of 2026 remained flat compared to the same period in 2025.
Selling, general and administrative ("SG&A") expense for the second quarter of 2026 was $212.0 million or 32.6% of sales, compared to $207.7 million, or 31.9% of sales for the second quarter of 2025. The increase in SG&A expense was primarily due to higher employee related costs.
Research and development ("R&D") expense for the second quarter of 2026 was $61.2 million or 9.4% of sales, compared to $60.5 million or 9.3% of sales in the second quarter of 2025. The increase in R&D expense was primarily due to higher project related spending.
Results of Operations – Non-operating
Interest expense for the second quarter of 2026 and 2025 was $12.1 million and $12.6 million, respectively, which primarily consisted of interest expense related to the $1.2 billion Senior Notes.
Foreign currency exchange (gains) losses, net consist primarily of foreign currency transaction gains and losses on intercompany net receivables and payables and the change in fair value of our forward foreign exchange contracts used to manage our foreign currency exchange risk. Foreign currency exchange gains, net were $0.2 million for the second quarter of 2026 compared to foreign currency exchange losses, net of $1.1 million for the second quarter of 2025, respectively. Gains and losses are primarily due to the timing of product shipments and intercompany debt payments, market volatility, and the change in the fair value of our foreign exchange contracts.
(Gains) losses from change in fair market value of equity securities and loan receivable was gain of $458.0 million and $334.4 million for the second quarter of 2026 and 2025, respectively. The change in the fair market value primarily resulted from the recognition of holding gains of $430.0 million in the second quarter of 2026 compared to holding gains of $326.6 million in the second quarter of 2025 on our investment in Sartorius. In addition, holding gains from the change in fair market value of our loan receivable of $15.1 million in the second quarter of 2026 compared to holding losses of $2.4 million in the second quarter of 2025 contributed to the change.
Other income, net for the second quarter of 2026 was $23.4 million compared to $16.2 million for the second quarter of 2025. The increase in Other income, net of $7.2 million was primarily attributable to higher interest and investment income in the second quarter of 2026 compared to the second quarter of 2025.
Our effective income tax rate was 31.5% and 23.2% for the second quarter of 2026 and 2025, respectively. The effective tax rate reported in these periods was primarily affected by the change in fair market value of our equity securities, shifts in the geographical mix of earnings and enactment of new tax legislation during the period.
Six Months Ended June 30, 2026 Compared to
Six Months Ended June 30, 2025
Results of Operations -- Sales, Margins and Expenses
Percentage sales growth in currency-neutral amounts are calculated by translating prior period sales in each local currency using the current period monthly average foreign exchange rates for that currency and comparing that to current period sales.
33
Net sales ("sales") for the first six months of 2026 were $1.24 billion, an increase of 0.5% compared to the same period in 2025. On a currency-neutral basis, sales decreased 3.0% compared to the first six months of 2025. The decrease in sales was driven by lower sales in both Life Science and Clinical Diagnostics segments.
The Life Science segment sales for the first six months of 2026 were $480.5 million, a decrease of 2.2% compared to the same period in 2025. On a currency-neutral basis, sales decreased 4.7% compared to the first six months of 2025, primarily driven by ongoing challenges in the academic research market, particularly in the Americas. Currency-neutral sales decreased in the Americas and EMEA, partially offset by increased sales in Asia Pacific.
The Clinical Diagnostics segment sales for the first six months of 2026 were $762.6 million, an increase of 2.3% compared to the same period in 2025. On a currency-neutral basis, sales decreased 1.9% compared to the first six months of 2025, primarily driven by lower sales of infectious disease products. Currency-neutral sales decreased in EMEA and Asia Pacific, partially offset by increased sales in the Americas.
Consolidated gross margins were 52.7% for the first six months of 2026 and 2025. Gross margins for the Life Science segment and the Clinical Diagnostics segment for the first six months of 2026 remained essentially flat compared to the same period in 2025.
Selling, general and administrative ("SG&A") expenses increased to $424.4 million or 34.1% of sales for the first six months of 2026 compared to $416.5 million or 33.7% of sales for the first six months of 2025. The increase in SG&A expense was primarily due to foreign exchange impact resulting from a weaker U.S. dollar on our international cost base, partially offset by lower restructuring costs.
Research and development ("R&D") expenses decreased to $124.1 million or 10.0% of sales in the first six months of 2026 compared to $134.0 million or 10.8% of sales in the first six months of 2025. The decrease in R&D expense was primarily due to lower restructuring costs.
Results of Operations – Non-operating
Interest expense for the first six months of 2026 and 2025 was $24.4 million and $24.6 million, respectively, which primarily consisted of interest expense related to the $1.2 billion Senior Notes.
Foreign currency exchange (gains) and losses consist primarily of foreign currency transaction gains and losses on intercompany net receivables and payables and the change in fair value of our forward foreign exchange contracts used to manage our foreign currency exchange risk. Foreign currency exchange gains, net were $2.6 million and $1.6 million for the first six months of 2026 and 2025. Gains and losses are primarily due to the timing of product shipments and intercompany debt payments, market volatility, and the change in the fair value of our foreign exchange contracts.
(Gains) losses from change in fair market value of equity securities and loan receivable was a loss of $280.2 million and gain of $366.2 million for the first six months of 2026 and 2025, respectively. The change in the fair market value primarily resulted from the recognition of lower holding losses of $297.7 million in the first six months of 2026 compared to holding gains of $355.7 million in the first six months of 2025 on our position in Sartorius. This was partially offset by higher holding gains from the change in fair market value of our loan receivable of $6.7 million in the first six months of 2026 compared to holding gains of $2.2 million in the first six months of 2025 contributed to the change.
Other income, net for the first six months of 2026 was $47.6 million compared to $53.4 million for the first six months of 2025. The decrease in Other income, net of $5.8 million was primarily attributable to lower interest and investment income in the first six months of 2026 compared to the first six months of 2025.
Our effective income tax rate was (5.4)% and 23.2% for the first six months of 2026 and 2025, respectively. The effective tax rate reported in the first six months of both 2026 and 2025 was primarily affected by the change in fair market value of our equity securities.
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Liquidity and Capital Resources
Bio-Rad operates and conducts business globally, primarily through subsidiary companies established in the markets in which we trade. Goods are manufactured in a small number of locations, and are then shipped to local distribution facilities around the world. Our product mix is diversified, and certain products compete largely on product efficacy, while others compete on price. Gross margins are generally sufficient to exceed normal operating costs, and funding for research and development of new products, as well as routine outflows for capital expenditures, interest and taxes.
As of June 30, 2026, we had available $1.62 billion in cash, cash equivalents and short-term investments, of which approximately 14% was held in our foreign subsidiaries. The amount of funds held in the United States can fluctuate due to the timing of receipts and payments in the ordinary course of business and due to other reasons, such as acquisitions and borrowings. As part of our ongoing liquidity assessments, we regularly monitor the mix of domestic and foreign cash flows (both inflows and outflows). It is generally our intention to repatriate certain foreign earnings to the extent that such repatriations are not restricted by local laws, and there are no substantial incremental costs.
Additional liquidity is realized through positive cash flows from operating activities, and is readily available via the sale of short-term investments and access to our $200.0 million unsecured Revolving Credit Agreement, available through February 2029, and to a lesser extent international lines of credit. Borrowings under the Revolving Credit Agreement are available on a revolving basis and can be used to make acquisitions, for working capital and for other general corporate purposes. We had no outstanding borrowings under the Revolving Credit Agreement as of June 30, 2026, however, $6.0 million was utilized for domestic standby letters of credit that reduced our borrowing availability.
In March 2022, we received $1.2 billion in cash proceeds from the issuance of Senior Notes. The $400 million and $800 million Senior Notes mature in March 2027 and March 2032, respectively, and interest on the Senior Notes is 3.3% and 3.7% per annum, respectively. Interest is payable semiannually in arrears on March 15 and September 15 of each year. The $400 million Senior Notes are classified as current as of June 30, 2026. We have sufficient liquidity available to repay this obligation, including $1.62 billion in cash, cash equivalents and short-term investments as of June 30, 2026. In addition to repayment at maturity, we may also consider refinancing all or a portion of the Senior Notes, though any such refinancing may be at a higher interest rate than the current Senior Notes, depending on market conditions at the time.
Management believes that our cash, cash equivalents and short-term investments, together with cash flow from operations and the unsecured Revolving Credit Agreement, will be adequate to meet our current objectives for operations, research and development, capital additions for manufacturing and distribution, plant and equipment, information technology systems and acquisitions of reasonable proportion to our existing total available capital for the next twelve months and beyond.
Cash Flows from Operations
Net cash provided by operations was $206.8 million and $246.4 million for the six months ended June 30, 2026 and 2025, respectively. The decrease in operating cash flows was primarily due to lower cash received from customers and higher cash paid to suppliers and employees.
Cash Flows from Investing Activities
Net cash used in investing activities was $159.9 million and $112.5 million for the six months ended June 30, 2026 and 2025, respectively. The change is primarily due to the timing of our purchases, maturities and sales of marketable securities and investments partially offset by net cash outflows for the acquisition of Stilla on June 30, 2025.
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Cash Flows from Financing Activities
Net cash used in financing activities was $71.6 million and $234.0 million for the six months ended June 30, 2026, and 2025, respectively. The decrease in net cash used in financing activities was primarily attributable to lower share repurchases.
During the six months ended June 30, 2026, we repurchased 286,685 shares of Class A common stock for $79.3 million and during the six months ended June 30, 2025, we repurchased 992,803 shares of Class A common stock for $242.1 million. We designated these repurchased shares as treasury stock. As of June 30, 2026, $206.0 million remained available for repurchases under the 2023 Share Repurchase Program. Repurchases under the 2023 Share Repurchase program may be made at management’s discretion from time to time on the open market, through trading plans in accordance with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, or through privately negotiated transactions, which may include structured repurchases.
Recent Accounting Pronouncements Adopted
See Note 1 to the condensed consolidated financial statements for recent accounting pronouncements adopted and to be adopted.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
During the six months ended June 30, 2026, there have been no material changes from the disclosures about market risk provided in our Annual Report on Form 10-K for the year ended December 31, 2025.
Item 4. Controls and Procedures
Disclosure Controls and Procedures
We maintain “disclosure controls and procedures,” as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (“Exchange Act”), that are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Additionally, in designing disclosure controls and procedures, our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
Subject to the limitations noted above, our management, with the participation of our CEO and CFO, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, the CEO and CFO have concluded that, as of such date, our disclosure controls and procedures were effective to meet the objective for which they were designed and operate at the reasonable assurance level.
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Changes to Internal Control Over Financial Reporting
We identified no changes in internal control over financial reporting that occurred during our quarter ended June 30, 2026 that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.
PART II – OTHER INFORMATION
Item 1. Legal Proceedings
We are a party to various claims, legal actions and complaints arising in the ordinary course of business. While we do not believe, at this time, that any ultimate liability resulting from any of these matters will have a material adverse effect on our results of operations, financial position or liquidity, we cannot give any assurance regarding the ultimate outcome of these matters and their resolution could be material to our operating results for any particular period, depending on the level of income for the period.
Item 1A. Risk Factors
In evaluating our business and whether to invest in any of our securities, you should carefully read the following risk factors in addition to the other information contained in this report. We believe that any of the following risks (some of which have occurred and any of which may occur in the future) could have a material adverse effect on our business, results of operations or financial condition, our industry, the value of our equity holdings, or the trading price of our common stock. We operate in a continually changing business environment, and new risks and uncertainties emerge from time to time. We cannot predict these new risks and uncertainties, nor can we assess the extent to which any such new risks and uncertainties or the extent to which the risks and uncertainties set forth below may adversely affect our business, results of operations, financial condition, our industry, the value of our equity holdings, or the trading price of our common stock. Please carefully consider the following discussion of significant factors, events and uncertainties that make an investment in our securities risky and provide important information for the understanding of the “forward-looking” statements discussed in this report. Additional or unforeseen effects from the global economic and geopolitical climate may give rise to or amplify many of these risks discussed below.
Business, Economic, Legal and Industry Risks
Our international operations expose us to additional costs and legal and regulatory risks, which could have a material adverse effect on our business, results of operations and financial condition.
We have significant international operations. We have direct distribution channels in over 36 countries outside the United States, and during the six months ended June 30, 2026 our foreign entities generated 61% of our net sales. Compliance with complex foreign and U.S. laws and regulations that apply to our international operations increases our cost of doing business. These numerous and sometimes conflicting laws and regulations include, among others, data privacy requirements, labor relations laws, tax laws, unfair competition regulations, import and trade restrictions, tariffs, duties, quotas and other trade barriers, export requirements, U.S. laws such as the Foreign Corrupt Practices Act ("FCPA") and other U.S. federal laws and regulations established by the office of Foreign Asset Control, foreign laws such as the UK Bribery Act 2010 or other foreign laws which prohibit corrupt payments to governmental officials or certain payments or remunerations to customers. In addition, changes in laws or regulations potentially could be disruptive to our operations and business relationships in the affected regions.
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Given the high level of complexity of the foreign and U.S. laws and regulations that apply to our international operations, we cannot guarantee that we have not or will not inadvertently breach some provisions, for example, through fraudulent or negligent behavior of individual employees, our failure to comply with certain formal documentation requirements, or otherwise. In addition, we operate in some countries in which the business environment is subject to a higher risk of corruption. Our success depends, in part, on our ability to anticipate these risks and manage these challenges through policies, procedures and internal controls. However, we have a dispersed international sales organization, and we use distributors and agents in many of our international operations. This structure makes it more difficult for us to ensure that our international selling operations comply with laws and regulations, and our global policies and procedures.
Violations of these laws and regulations could result in fines, criminal sanctions against us, our officers or our employees, requirements to obtain export licenses, cessation of business activities in sanctioned countries, implementation of compliance programs, and prohibitions on the conduct of our business. Violations of laws and regulations also could result in prohibitions on our ability to offer our products in one or more countries and could materially damage our reputation, our brand, our international expansion efforts, our ability to attract and retain employees, or our business, results of operations and financial condition. See also our risk factors regarding government regulations and global economic conditions below.
The industries and market segments in which we operate are highly competitive, and we may not be able to compete effectively.
The life science and clinical diagnostics markets are each highly competitive. Some of our competitors have greater financial resources than we do, making them better equipped to license technologies and intellectual property from third parties or to fund research and development, manufacturing and marketing efforts, or to source high-demand materials and components. Moreover, competitive and regulatory conditions in many markets in which we operate restrict our ability to fully recover, through price increases, higher costs of acquired goods and services resulting from inflation and other drivers of cost increases. Many public tenders have become more competitive due to governments lengthening the commitments of their public tenders to multiple years, which reduce the number of tenders in which we can participate annually. Because the value of these multiple-year tenders is so high, our competitors have been more aggressive with their pricing. Our failure to compete effectively and/or pricing pressures resulting from competition could adversely affect our business, results of operations and financial condition.
We may not be able to grow our business because of our failure to develop new or improved products.
Our future growth depends in part on our ability to continue to improve our product offerings and develop and introduce new products that integrate technological advances. If we are unable to integrate technological advances into our product offerings or to design, develop, manufacture and market new products successfully and in a timely manner, our business, results of operations and financial condition will be adversely affected. Supply chain disruptions have caused some delays to our ability to develop and introduce new products. We have experienced product launch delays in the past and may do so in the future. We cannot assure you that our product and process development efforts will be successful or that new products we introduce will achieve market acceptance. Failure to launch successful new products or improvements to existing products may cause our products to become obsolete, which could harm our business, results of operations and financial condition.
Global economic and geopolitical conditions could adversely affect our operations.
In recent years, we have been faced with challenging global economic conditions. U.S. and international markets have experienced inflationary pressures, and inflation rates in the U.S. and in other countries in which we operate have been at elevated levels. Our raw material costs have increased, and we are not always able to recover these increased costs from our customers. Russia’s invasion of Ukraine and sanctions against Russia have caused disruptions to global economic conditions and are negatively impacting our business. Conflicts in the Middle East have caused disruptions to the stability of the region and are negatively impacting our business and particularly our sales in that region. Conflicts in the Middle East also have affected the global business environment, including by disrupting international logistics, increasing freight costs, and impacting the supply and cost of fuel. It is unknown how long any of these disruptions will continue and whether such disruptions will become more severe. In addition, we expect moderating economic growth and changing government policies in China will continue to affect our commercial opportunities in the country. A deterioration in the global economic environment may result in a
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decrease in demand for our products, increased competition, downward pressure on prices for our products and longer sales cycles. A weakening of macroeconomic conditions is also adversely affecting our suppliers, which could continue to result in interruptions in the supply of components and raw materials necessary for our products and raw material cost increases. We also continue to analyze the impacts on our business as recent events unfold regarding tariffs imposed by the United States, tariffs imposed by other countries on certain U.S. goods, and the volatility resulting from changing policies regarding tariffs, associated retaliatory or other countermeasures, and trade relationships. These events have impacted and we expect will continue to impact the global economic and geopolitical environment, and could lead to higher prices, inflation and possibly a recession. This could lead to higher costs for our products and lower revenue, and could adversely impact our profitability and/or our competitiveness. See also our risk factors regarding our international operations above and regarding government regulations below.
Reductions in government funding and the capital spending programs of our customers have negatively impacted our revenue and could have a material adverse effect on our business, results of operations or financial condition.
Our customers include universities, clinical diagnostics laboratories, government agencies, hospitals and pharmaceutical, biotechnology and chemical companies. The capital spending programs of these institutions and companies have a significant effect on the demand for our products. Such programs are based on a wide variety of factors, including the resources available to make such purchases, the availability of funding from grants by governments or government agencies, the spending priorities for various types of equipment and the policies regarding capital expenditures during industry downturns or recessionary periods. In 2025, the United States government proposed reductions of federal funding to some institutions and companies that are our customers. Reduced government spending, along with ongoing challenges in the biopharma market and among small biotech companies, continues to negatively impact our business. If funding to our customers continues to decrease, or if our customers decrease or reallocate their budgets in a manner adverse to us, our business, results of operations or financial condition could be materially and adversely affected.
A reduction or interruption in the supply of components and raw materials has adversely affected and could continue to adversely affect our manufacturing operations and related product sales.
The manufacture of our products requires the timely delivery of sufficient amounts of quality components and materials. We manufacture our products around the world. We acquire our components and materials from many suppliers in various countries. We work closely with our suppliers to ensure the continuity of supply, but we cannot guarantee these efforts will always be successful. Further, while we seek to diversify our sources of components and materials, in certain instances we acquire components and materials from a sole supplier. We have experienced raw material cost increases, some of which will likely continue. Disruptions to international logistics and to the supply and cost of fuel resulting from conflicts in the Middle East also can contribute to increases in our raw material costs. In addition, due to the regulatory environment in which we operate, we may need to cease use of certain essential components and materials and be unable to establish acceptable replacement sources for such components or materials. When our supply is reduced or interrupted or of poor quality, and we are unable to develop alternative sources for such supply, our ability to manufacture our products in a timely or cost-effective manner is adversely affected, which affects our ability to sell our products and increases our risk of losing customers. Tariff increases and associated supply chain disruptions can also impact our business. In addition, when we do not accurately estimate demand for our products, we may experience excess and obsolete inventories and be forced to incur additional expenses, which could adversely affect our results of operations. See also our risk factor regarding global economic conditions above.
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Breaches of our information systems could have a material adverse effect on our business and results of operations.
We have experienced and expect to continue to experience attempts by individuals and organizations to attack and penetrate our layered security controls. Through our sales and eCommerce channels, we collect and store confidential information that customers provide to, among other things, purchase products or services, enroll in promotional programs and register on our web site. We also acquire and retain information about suppliers and employees in the normal course of business. Such information on our systems includes personally identifiable information and, in limited instances, protected health information. We also create and maintain proprietary information that is critical to our business, such as our product designs and manufacturing processes. Despite initiatives to improve our technology systems, such as our enterprise resource planning implementation and the centralization of our global information technology organization, we could experience a significant data security breach. The Company is also subject to phishing and other fraud schemes including fraudulent vendor communications with requests for payments and fraudulent attempts to redirect payments to improper bank accounts, some of which have been successful. While the Company has adopted training and process changes to limit the success of such fraudulent activity, the Company will be unable to stop all such fraudulent activity which may lead to unrecoverable payments to criminal accounts. Because the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently and often are not recognized until launched against a target, we may not be able to anticipate all of these techniques or to implement adequate preventive measures. Computer hackers have attempted to penetrate and will likely continue to attempt to penetrate our and our vendors’ information systems and, if successful, could misappropriate confidential customer, supplier, employee or other proprietary business information, such as our intellectual property. Third parties could also gain control of our systems and use them for criminal purposes while appearing to be us. As a result, we could lose existing customers, have difficulty attracting new customers, be exposed to claims from customers and suppliers, financial institutions, payment card associations, employees and other persons, have regulatory sanctions or penalties imposed, incur additional expenses or lose revenues as a result of a data privacy breach, or suffer other adverse consequences. Our operations and ability to process sales orders, particularly through our eCommerce channels, could also be disrupted, as they have been in the past. Any significant breakdown, intrusion, interruption, corruption, or destruction of our systems, as well as any data breaches, could have a material adverse effect on our business and results of operations. See also our risk factors regarding our information technology systems below.
If our information technology systems are disrupted, or if we fail to successfully implement, manage and integrate our information technology and reporting systems, our business, results of operations and financial condition could be harmed.
Our information technology ("IT") systems are an integral part of our business, and a significant disruption of our IT systems (which increasingly include cloud-based systems provided by third party vendors) could have a material adverse effect on our business, results of operations and financial condition. We depend on our IT systems to process orders, manage inventory, pay our vendors and collect accounts receivable. Our IT systems also allow us to efficiently purchase products from our suppliers and ship products to our customers on a timely basis, maintain cost-effective operations and provide customer service. We cannot assure you that our contingency plans will allow us to operate at our current level of efficiency.
Our ability to implement our business plan in a rapidly evolving market requires effective planning, reporting and analytical processes. We expect that we will need to continue to improve and further integrate our IT systems, reporting systems and operating procedures by training and educating our employees with respect to these improvements and integrations on an ongoing basis in order to effectively run our business. We may suffer interruptions in service, loss of data or reduced functionality when we upgrade or change systems or migrate to cloud-based systems. If we fail to successfully manage and integrate our IT systems, reporting systems and operating procedures, it could adversely affect our business, results of operations and financial condition. See also our risk factors regarding our data security above and events beyond our control below.
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Use of generative AI and other AI technologies presents risks and challenges due to the evolving nature of AI.
We utilize artificial intelligence and machine learning technologies (“AI”), such as chatbots, assistants and automation agents, in our business operations, and we are exploring the other opportunities that AI could bring us. The use of AI, particularly generative AI, and the developing regulatory landscape pose risks that could expose us to liability or adversely affect our business. Integration of AI into our and our vendors’ systems (potentially without the vendor disclosing such use to us) subjects us to the risk that the providers of AI may not meet existing or rapidly evolving regulatory or industry standards with respect to privacy and data protection. This may lead to loss of intellectual property or exposure of confidential or proprietary information, breaches of security or privacy, and reduced levels of service or experience. Sophisticated cyberattacks, including those using AI, could increase these risks. Generative AI can produce false or misleading outputs, or generate content that may not be subject to intellectual property protection or that infringes proprietary rights of others, and thereby present additional risks to our business. Regulatory changes or reinterpretations could introduce new compliance risks, including potential government enforcement actions or civil lawsuits. In addition, a failure to timely and effectively use or deploy AI and integrate it into new product offerings and services could negatively impact our competitiveness, particularly ahead of developing consumer demands and evolving industry trends. Our competitors’ faster or more effective adoption of AI also could disadvantage us.
We are subject to foreign currency exchange fluctuations, which could have a material adverse effect on our results of operations and financial condition.
A significant portion of our operations and sales are outside of the United States. When we make purchases and sales in currencies other than the U.S. dollars, we are exposed to fluctuations in foreign currencies relative to the U.S. dollar that may adversely affect our results of operations and financial condition. Our international sales are largely denominated in local currencies. As a result, the strengthening of the U.S. dollar negatively impacts our consolidated net sales expressed in U.S. dollars. Conversely, when the U.S. dollar weakens, our expenses at our international sites increase. In addition, the volatility of other currencies may negatively impact our operations outside of the United States and increase our costs to hedge against currency fluctuations. We use derivative instruments to hedge a portion of our currency exposure. These hedging activities may not be effective, may not fully offset the underlying exposure due to imperfect correlation, timing, or forecasting of exposures, and may limit the benefit we would otherwise realize from favorable currency movements. If our hedging positions are incorrectly sized or currencies move contrary to our expectations, we could incur unexpected gains or losses that materially affect our results of operations. We also hold investments and a loan receivable that are subject to foreign exchange fluctuations. We cannot assure you that future shifts in currency exchange rates will not have a material adverse effect on our results of operations and financial condition.
Changes in the market value of our position in Sartorius AG materially impact our financial results.
Changes in the market value of our position in Sartorius AG will continue to materially impact our condensed consolidated statements of income (loss) and other financial statements. A decline in the market value of our position in Sartorius AG will result in decreases in net income due to write-downs in the value of the equity securities. An increase in the market value of our position in Sartorius AG will result in a favorable impact to net income independent of the actual operating performance of our business. Depending on the extent of the decline or of the increase in the market value of our position in Sartorius AG, these negative or positive impacts on us could continue to be material.
Our share price may change significantly based upon changes in the market value of our position in Sartorius AG, independent of the actual performance of our business. Additionally, non-operating income for a period may be significantly impacted by any distribution of dividends by Sartorius AG, particularly when the dividends amount varies in comparison to prior year periods.
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The value of our position in Sartorius AG might cause us to be deemed an investment company under the Investment Company Act of 1940.
As a result of the market value of our position in Sartorius AG, we might be deemed to be an “investment company” under Section 3(a)(1)(C) of the Investment Company Act of 1940, as amended (the “Investment Company Act”). The Company does not believe it is an investment company primarily in reliance on Section 3(b)(1) of the Investment Company Act because we are “primarily engaged” in a business other than that of investing, reinvesting, owning, holding or trading in securities. Rather, we are primarily engaged in the development, manufacturing and marketing of products for the life science research and clinical diagnostic markets, and we believe that our historical development, our public representations of policy, the activity of our officers and directors, the nature of our present assets, the sources of our present income, and the public perception of the nature of our business all support the conclusion that we are an operating company and not an investment company. Although we have discussed this issue with the staff of the SEC and we are comfortable with our position, if it is determined later that the Company may not rely on Section 3(b)(1) or any other exemption under the Investment Company Act and the Company were deemed to be an unregistered investment company, such determination would have a material adverse effect on our business as we would need to register as an investment company and be subject to the regulations of the Investment Company Act which are designed to restrict and regulate mutual funds rather than operating companies. It could also call into question the validity of all contracts to which the Company is a party. If it appeared likely that we would be deemed to be an investment company, we may modify our position in Sartorius AG in order to avoid such determination.
We have incurred and may continue to incur losses due to write-downs in the value of our financial instruments.
We have positions in a variety of financial instruments including asset-backed securities and other similar investments. Financial markets are volatile and the markets for these securities can be illiquid. The value of these securities will continue to be impacted by external market factors including default rates, changes in the value of the underlying property, such as residential or commercial real estate, rating agency actions, the prices at which observable market transactions occur and the financial strength of various entities, such as financial guarantors who provide insurance for the securities. Should we need to convert these positions to cash, we may not be able to sell these instruments without significant losses due to current debtor financial conditions, low trading volume of the securities, or other market considerations.
As discussed further in the Notes to condensed consolidated financial statements, in Note 3. Fair Value Measurements and Investments, under the heading “Level 3 Fair Value Investments”, we made a loan of 400 million Euros to Sartorius-Herbst Beteiligungen II GmbH in November 2021 that is secured by the pledge of certain trust interests which upon termination of the trust represent the right to receive Sartorius ordinary shares (the "Loan"). Prior to a termination of the trust, the trust interests, which are provided as collateral for the Loan, are not tradable on the capital markets and may, in case of an enforcement, have to be sold with a significant discount to the value of the underlying shares.
We also have positions in equity securities, including our position in Sartorius AG. Financial markets are volatile and the markets for these equity securities can be illiquid as well. A decline in the market value of our investments in equity securities has resulted and could continue to result in significant losses due to write-downs in the value of the equity securities. Also, if we need to convert these positions to cash, we may not be able to sell these equity securities without significant losses. In addition, significant declines in the value of the Sartorius ordinary shares have reduced the value of the collateral for the Loan discussed in the previous paragraph. The value of the collateral may be insufficient to cover the repayment of the Loan if the decline in value continues, and Sartorius-Herbst Beteiligungen II GmbH will likely have no other assets from which to repay the Loan. Furthermore, the change in the market value of Sartorius ordinary shares will have an impact on the value appreciation rights acquired in connection with the Loan discussed in the previous paragraph.
Recent and planned changes to our organizational structure could negatively impact our business.
We made significant changes to our organizational structure over the past few years, including through restructurings. These changes may have unintended consequences, such as distraction of our management and employees, labor unrest, business disruption, disruption of supply, attrition of our workforce, inability to attract or retain key employees, and reduced employee morale or productivity.
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Risks relating to intellectual property rights may negatively impact our business.
We rely on a combination of copyright, trade secret, patent and trademark laws and third-party nondisclosure agreements to protect our intellectual property rights and products. However, we cannot assure you that our intellectual property rights will not be challenged, invalidated, circumvented or rendered unenforceable, or that meaningful protection or adequate remedies will be available to us. Unauthorized third parties have attempted to copy our intellectual property, reverse engineer or obtain and use information that we regard as proprietary, or have developed equivalent technologies independently, and may do so in the future. Additionally, third parties have asserted patent, copyright and other intellectual property rights to technologies that are important to us and may do so in the future. If we are unable to license or otherwise access protected technology used in our products, or if we lose our rights under any existing licenses, we could be prohibited from manufacturing and marketing such products. From time to time, we also must enforce our patents or other intellectual property rights or defend ourselves against claimed infringement of the rights of others through litigation. As a result, we could incur substantial costs, be forced to redesign our products, or be required to pay damages or royalties to an infringed party. Any of the foregoing matters could adversely impact our business, results of operations and financial condition.
Changes in the healthcare industry could have an adverse effect on our business, results of operations and financial condition.
There have been, and will continue to be, significant changes in the healthcare industry in an effort to reduce costs. These changes include:
•The trend towards managed care, together with healthcare reform of the delivery system in the United States and efforts to reform in Europe and China, has resulted in increased pressure on healthcare providers and other participants in the healthcare industry to reduce selling prices. Consolidation among healthcare providers and consolidation among other participants in the healthcare industry has resulted in fewer, more powerful groups, whose purchasing power gives them cost containment leverage. In particular, there has been a consolidation of laboratories and a consolidation of blood transfusion centers. These industry trends and competitive forces place constraints on the levels of overall pricing and thus could have a material adverse effect on our gross margins for products we sell in clinical diagnostic markets.
•Third party payors, such as Medicare and Medicaid in the United States, have reduced their reimbursements for certain medical products and services. Our Clinical Diagnostics business is impacted by the level of reimbursement available for clinical tests from third party payors. In the United States payment for many diagnostic tests furnished to Medicare fee-for-service beneficiaries is made based on the Medicare Clinical Laboratory Fee Schedule ("CLFS"), a fee schedule established and adjusted from time to time by the Centers for Medicare and Medicaid Services ("CMS"). Some commercial payors are guided by the CLFS in establishing their reimbursement rates. Laboratories and clinicians may decide not to order or perform certain clinical diagnostic tests if third party payments are inadequate, and we cannot predict whether third party payors will offer adequate reimbursement for tests utilizing our products to make them commercially attractive. Legislation, such as the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act ("PPACA") and the Middle Class Tax Relief and Job Creation Act of 2012, has reduced the payments for clinical laboratory services paid under the CLFS. In addition, the Protecting Access to Medicare Act of 2014 ("PAMA") has made significant changes to the way Medicare will pay for clinical laboratory services, which has further reduced reimbursement rates.
To the extent that the healthcare industry seeks to address the need to contain costs stemming from reform measures such as those contained in the PPACA and the PAMA, or in future legislation, by limiting the number of clinical tests being performed or the amount of reimbursement available for such tests, our business, results of operations and financial condition could be adversely affected. If these changes in the healthcare markets in the United States and Europe continue, we could be forced to alter our approach in selling, marketing, distributing and servicing our products.
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We are subject to substantial government regulation, and any changes in regulation or violations of regulations by us could adversely affect our business, prospects, results of operations or financial condition.
Some of our products (primarily our Clinical Diagnostic products), production processes and marketing are subject to U.S. federal, state and local, and foreign regulation, including by the Food and Drug Administration ("FDA") in the United States and its foreign counterparts. The FDA regulates our Clinical Diagnostic products as medical devices, and we are subject to significant regulatory clearances or approvals to market our Clinical Diagnostic products and other requirements including, for example, recordkeeping and reporting requirements, such as the FDA’s medical device reporting regulations and reporting of corrections and removals. The FDA has broad regulatory and enforcement powers. If the FDA determines that we have failed to comply with applicable regulatory requirements, it can impose a variety of enforcement actions ranging from public warning letters, fines, injunctions, consent decrees and civil penalties to suspension or delayed issuance of approvals, seizure or recall of our products, total or partial shutdown of production, withdrawal of approvals or clearances already granted, and criminal prosecution.
The FDA can also require us to repair, replace or refund the cost of devices that we manufactured or distributed. In addition, the FDA may change its clearance and approval policies, adopt additional regulations or revise existing regulations, or take other actions, which may prevent or delay approval or clearance of our products or impact our ability to modify our currently approved or cleared products on a timely basis. Any delay in, or failure to receive or maintain, clearance or approval for our products or changes in regulation could prevent us from generating revenue from these products and adversely affect our business operations and financial results. Additionally, the FDA and other regulatory authorities have broad enforcement powers. Regulatory enforcement or inquiries, or other increased scrutiny on us, could affect the perceived safety and efficacy of our products and dissuade our customers from using our products.
In May 2024, the FDA issued a final rule applicable to certain clinical diagnostic products referred to as laboratory developed tests ("LDTs"). A federal court vacated the rule in March 2025, and the FDA subsequently formally rescinded the final rule. If there is new legislation in the future to bring LDTs under the same FDA regulatory framework as other in vitro diagnostics, this change could negatively impact our customers who use our life science products for LDTs.
Many foreign governments have similar rules and regulations regarding the importation, registration, labeling, sale and use of our products. Such agencies may also impose new requirements that may require us to modify or re-register products already on the market or otherwise impact our ability to market our products in those countries. The EU in-vitro Diagnostics Regulation (the “EU IVDR”) includes broad changes regarding in vitro diagnostic devices and medical devices. The EU IVDR required us to modify or re-register some products, and we expect will continue to result in additional costs for ongoing compliance. In addition, Russia has enacted more stringent medical product registration and labeling regulations, China has enacted stricter labeling requirements, and we expect other countries, such as Brazil and India, to impose more regulations that impact our product registrations. New government administrations also may interpret existing regulations or practices differently. Due to these evolving and diverse requirements, we face uncertain product approval timelines, additional time and effort to comply, as well as the potential for reduced sales and/or fines for noncompliance. Increasing protectionism in such countries also impedes our ability to compete with local companies. We may not be able to participate in certain public tenders in China, India and Russia because of increasing measures to restrict access to such tenders for companies without local manufacturing capabilities. Such regulations could adversely affect our business, results of operations and financial condition. See also our risk factors regarding our international operations and regarding global economic and geopolitical conditions above.
We are also subject to government regulation of the use and handling of a number of materials and controlled substances. The U.S. Drug Enforcement Administration establishes registration, security, recordkeeping, reporting, storage, distribution and other requirements for controlled substances pursuant to the Controlled Substances Act of 1970. Failure to comply with present or future laws and regulations could result in substantial liability to us, suspension or cessation of our operations, restrictions on our ability to expand at our present locations or require us to make significant capital expenditures or incur other significant expenses.
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We cannot assure you that we will be able to integrate acquired companies, products or technologies into our company successfully, or that we will be able to realize the anticipated benefits from the acquisitions.
As part of our overall business strategy, we pursue acquisitions of and investments in complementary companies, products and technologies. The benefits of any acquisition or investment may prove to be less than anticipated, which we have experienced in some of our acquisitions and investments, and may not outweigh the costs reported in our financial statements. Completing any potential future acquisitions could cause significant diversion of our management’s time and resources. If we acquire or invest in new companies, products or technologies, we may be required to assume contingent liabilities or record impairment charges for goodwill and other intangible assets over time. Goodwill and non-amortizable intangible assets are subject to impairment testing, and potential periodic goodwill impairment charges, amortization expenses related to certain intangible assets, and other write-offs could harm our operating results. Impairment tests are highly sensitive to changes in assumptions and minor changes to assumptions could result in impairment losses. If the results forecast in our impairment tests are not achieved, or business trends vary from the assumptions used in forecasts, or external factors change detrimentally, future impairment losses may occur, as they have occurred in the past, which may result in some volatility to our condensed consolidated statements of income (loss). Increased antitrust enforcement and greater government scrutiny of mergers in the healthcare sector may impact our ability to consummate acquisitions. We cannot assure you that we will successfully overcome these risks or any other problems we encounter in connection with any acquisitions or investments, and any such acquisitions or investments could adversely affect our business, results of operations and financial condition.
Product quality and liability issues could harm our reputation and negatively impact our business, results of operations and financial condition.
We must adequately address quality issues associated with our products, including defects in our engineering, design and manufacturing processes, as well as defects in third-party components included in our products. Our instruments, reagents and consumables are complex, and identifying the root cause of quality issues, especially those affecting reagents or third-party components, is difficult. We may incur significant costs and expend substantial time in researching and remediating such issues. Quality issues could also delay our launching or manufacturing of new products. In addition, quality issues, unapproved uses of our products, or inadequate disclosure of risks related to our products, could result in product recalls or product liability or other claims being brought against us. In responding to shortages, we may source components from alternative suppliers and distributors. Quality issues associated with components from these alternative sources may lead to product failures and associated costs notwithstanding our efforts to detect and remediate such quality issues. These issues could harm our reputation, impair our relationship with existing customers and harm our ability to attract new customers, which could negatively impact our business, results of operations and financial condition.
Lack of key personnel could hurt our business.
Our products are very technical in nature, and we operate in a complex and competitive business environment. In general, only highly qualified and well-trained scientists, technicians and other specialized individuals have the necessary skills to develop, market and sell our products, and many of our manufacturing positions require very specialized knowledge and skills. In addition, the global nature of our business also requires that we have sophisticated and experienced staff to comply with increasingly complex international laws and regulations. We face intense competition for these professionals from our competitors, customers, marketing partners and other companies throughout our industry. If we do not offer competitive compensation and benefits, we may fail to retain or attract a sufficient number of qualified personnel, which could impair our ability to properly run our business. Further, our ability to successfully execute organizational changes, including management transitions within our senior leadership team, are critical to our business success. If we are not able to fully integrate new executives, these changes could impact our ability to successfully execute our business strategy, which could adversely affect our business, results of operations and financial condition.
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We may have higher than anticipated tax liabilities.
We are subject to income taxes in the United States and many foreign jurisdictions. We report our results of operations based on our determination of the amount of taxes owed in various tax jurisdictions in which we operate. The determination of our worldwide provision for income taxes and other tax liabilities requires estimation, judgment and calculations where the ultimate tax determination may not be certain. Determination of our tax liabilities is subject to review or examination by tax authorities in various tax jurisdictions. Tax authorities have disagreed with our judgment in the past and may disagree with positions we take in the future resulting in assessments of additional taxes. Any adverse outcome of such review or examination could have a negative impact on our operating results and financial condition.
Economic and political pressures to increase tax revenues in various jurisdictions may make resolving tax disputes more difficult. In recent years, the tax authorities in Europe have disagreed with our tax positions related to hybrid debt, research and development credits, transfer pricing and indirect taxes, among others. We regularly assess the likelihood of the outcome resulting from these examinations to determine the adequacy of our provision for income taxes. Although we believe our tax estimates are reasonable, the final determination of tax audits and any related litigation could be materially different from our historical income tax provisions and accruals.
Changes in tax laws or rates, changes in the interpretation of tax laws or changes in the jurisdictional mix of our earnings could adversely affect our financial position and results of operations.
On July 4, 2025, the U.S. enacted tax reform through the One Big Beautiful Bill Act ("OBBBA"). Included in this legislation are provisions that allow for the immediate expensing of domestic U.S. research and development expenses, immediate expensing of certain capital expenditures, and other changes to the U.S. taxation of profits derived from foreign operations. The new legislation did not have a material impact on the income tax provision, and we do not anticipate a material impact in future years. We will continue to monitor U.S. Department of the Treasury guidance and regulations to assess any potential future effects.
On December 22, 2017, the U.S. enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”) which made a number of substantial changes to how the U.S. imposes income tax on multinational corporations. The U.S. Treasury, Internal Revenue Service and other standard setting bodies continue to issue guidance and interpretation relating to the Tax Act. As future guidance is issued, we may make adjustments to amounts previously reported that could materially impact our financial statements.
On August 16, 2022, President Biden signed into law the Inflation Reduction Act of 2022, which included an Alternative Minimum Tax based on the Adjusted Financial Statement Income of Applicable Corporations. We do not believe the Inflation Reduction Act will have a material impact on our income tax provision and cash taxes, but we continue to monitor U.S. Department of the Treasury guidance and regulations.
The tax effect of our position in Sartorius AG and the jurisdictional mix of our earnings could continue to materially affect our financial results and cash flow. In addition, the adoption of some or all of the recommendations set forth in the Organization for Economic Co-operation and Development ("OECD")’s project on “Base Erosion and Profit Shifting” ("BEPS") by tax authorities in the countries in which we operate, could negatively impact our effective tax rate. These recommendations focus on payments from affiliates in high tax jurisdictions to affiliates in lower tax jurisdictions and the activities that give rise to a taxable presence in a particular country.
On October 8, 2021, the OECD announced that 136 countries have agreed on a two-pillar framework that would dramatically alter the taxation of multinational enterprises and require that all profit be subject to a global minimum tax rate of 15%. On December 15, 2022, the European Union formally adopted the Pillar Two Directive and EU member states enacted the Pillar Two Directive as of January 1, 2024. Other countries have taken similar actions. We currently believe Pillar 2 legislation will not have a material impact on our income tax provision and cash taxes.
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Environmental, health and safety regulations and enforcement proceedings may negatively impact our business, results of operations and financial condition.
Our operations are subject to federal, state, local and foreign environmental laws and regulations that govern such activities as transportation of goods, materials that we use in our products, emissions to air and discharges to water, as well as handling and disposal practices for solid, hazardous and medical wastes. In addition to environmental laws that regulate our operations, we are also subject to environmental laws and regulations that create liability and responsibility for spills, disposals or other releases of hazardous substances into the environment as a result of our operations or otherwise impacting real property that we own or operate. The environmental laws and regulations also subject us to claims by third parties for damages resulting from any spills, disposals or releases resulting from our operations or at any of our properties. We must also comply with various health and safety regulations in the United States and abroad in connection with our operations.
We may in the future incur capital and operating costs to comply with currently existing laws and regulations, and possible new statutory enactments, and these expenditures may be significant. We have incurred, and may in the future incur, fines related to environmental matters and/or liability for costs or damages related to spills or other releases of hazardous substances into the environment at sites where we have operated, or at off-site locations where we have sent hazardous substances for disposal. We cannot assure you, however, that such matters or any future obligations to comply with environmental or health and safety laws and regulations will not adversely affect our business, results of operations or financial condition.
Complying with new laws or regulations concerning sustainability matters or climate related matters will result in increased compliance costs and create additional non-compliance risks. Failure to adequately meet our stakeholder’s expectations or comply with any such laws or regulations may result in loss of business, reputational damage, an inability to attract customers, an inability to attract and retain top talent, and a negative impact on our business, results of operations and financial condition. We also have announced certain sustainability goals, which require ongoing investment and operational changes. Our efforts may not achieve their intended outcomes, and we may not achieve such goals, which could negatively impact our reputation and business.
Our current and future debt and related covenants may restrict our future operations.
We have substantial debt and have the ability to incur additional debt. As of June 30, 2026, we had approximately $1.2 billion of outstanding indebtedness, including $400 million classified as current portion of long‑term debt, primarily related to our 3.3% Senior Notes due in March 2027, and $800 million of long‑term debt, primarily related to our 3.7% Senior Notes due in March 2032, as further discussed in Note 6 of the condensed consolidated financial statements. In addition, we have a revolving credit facility that provides for up to $200.0 million in borrowing capacity, $6.0 million of which was utilized for domestic standby letters of credit as of June 30, 2026. Our incurrence of substantial amounts of debt may have important consequences. For instance, it could:
•make it more difficult for us to satisfy our financial obligations, including those relating to our outstanding debt;
•require us to dedicate a substantial portion of our cash flow from operations to the payment of interest and principal due under our debt, which will reduce funds available for other business purposes;
•increase our vulnerability to general adverse economic and industry conditions;
•limit our flexibility in planning for, or reacting to, changes in our business and the industries in which we operate;
•place us at a competitive disadvantage compared with some of our competitors that have less debt; and
•limit our ability to obtain additional financing required to fund working capital and capital expenditures and for other general corporate purposes.
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Our existing credit facility, our Senior Notes and agreements we may enter in the future, contain or may contain covenants imposing restrictions on our business. These restrictions may affect our ability to operate our business and may limit our ability to take advantage of potential business opportunities as they arise. Existing covenants place restrictions on our ability to, among other things: incur additional debt; acquire other businesses or assets through merger or purchase; create liens; enter into transactions with affiliates; sell assets; and in the case of some of our subsidiaries, guarantee debt. Our existing credit facility also requires that we comply with a maximum consolidated leverage ratio test. Our ability to comply with these covenants may be affected by events beyond our control, including prevailing economic, financial and industry conditions. The breach of any of these restrictions could result in a default. An event of default under our debt agreements would permit certain of our lenders to declare all amounts borrowed from them to be due and payable, together with accrued and unpaid interest.
We are subject to healthcare laws and regulations and could face substantial penalties if we are unable to fully comply with such laws.
We are subject to healthcare regulation and enforcement by both the U.S. federal government and the U.S. states and foreign governments in which we conduct our business. These healthcare laws and regulations include, for example:
•the U.S. federal Anti-Kickback Statute, which prohibits, among other things, persons or entities from soliciting, receiving, offering or providing remuneration, directly or indirectly, in return for or to induce either the referral of an individual for, or the purchase order or recommendation of, any item or services for which payment may be made under a federal healthcare program such as the Medicare and Medicaid programs;
•U.S. federal false claims laws, which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid, or other third party payors that are false or fraudulent. In addition, the U.S. federal government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the false claims statutes;
•the U.S. Physician Payment Sunshine Act, which requires certain manufacturers of drugs, biologics, devices and medical supplies to record any transfers of value to U.S. physicians and U.S. teaching hospitals;
•the Health Insurance Portability and Accountability Act ("HIPAA"), as amended by the Health Information Technology for Economic and Clinical Health Act, which governs the conduct of certain electronic healthcare transactions and protects the security and privacy of protected health information; and state or foreign law equivalents of each of the U.S. federal laws above, such as anti-kickback and false claims laws, which may apply to items or services reimbursed by any third party payor, including commercial insurers.
These laws will continue to impose administrative, cost and compliance burdens on us. The shifting compliance environment and the need to build and maintain robust systems to comply with multiple jurisdictions with different compliance and/or reporting requirements increases the possibility that a healthcare company may violate one or more of these requirements. In addition, any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business. If our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to us, we may be subject to penalties, including civil and criminal penalties, damages, fines, exclusion from the Medicare and Medicaid programs or similar government programs in foreign jurisdictions, and the curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business, results of operations and financial condition.
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Risks Related to Being a Public Company
Our failure to establish and maintain effective internal control over financial reporting could result in material misstatements in our financial statements, our failure to meet our reporting obligations and cause investors to lose confidence in our reported financial information, which in turn could cause the trading price of our common stock to decline.
Maintaining effective disclosure controls and procedures and internal control over financial reporting are necessary for us to produce reliable financial statements. Material weaknesses in our internal control over financial reporting have adversely affected us in the past and could affect us in the future and the results of our periodic management evaluations and annual auditor attestation reports regarding the effectiveness of our internal control over financial reporting required by Section 404 of the Sarbanes-Oxley Act of 2002. Any failure to maintain or implement new or improved internal controls, or any difficulties that we may encounter in their maintenance or implementation, could result in additional material weaknesses, result in material misstatements in our consolidated financial statements and cause us to fail to meet our reporting obligations. This could cause us to lose public confidence and could cause the trading price of our common stock to decline.
General Business Risks
Natural disasters, climate related events, terrorist attacks, acts of war, pandemics, disease outbreaks or other events beyond our control may cause damage or disruption to us and our employees, facilities, information systems, security systems, vendors and customers, which could significantly impact our business, results of operations and financial condition.
We have significant manufacturing and distribution facilities, including in the United States, France, Switzerland, Germany and Singapore. In particular, the western United States has experienced a number of earthquakes, wildfires, floods, landslides and other natural disasters in recent years. These occurrences could damage or destroy our facilities which may result in interruptions to our business and losses that exceed our insurance coverage. In addition, lack of fuel resources due to geopolitical instability (such as Russia’s reduction in energy resources supplied to Western Europe and the recent escalation of regional conflicts in the Middle East), electricity outages, the inability to operate our production and distribution facilities due to power grid failures or lack of fuel, and strikes or other labor unrest at any of our sites or surrounding areas could cause disruption to our business. Acts of terrorism, bioterrorism, violence or war (such as Russia's invasion of Ukraine and the recent escalation of conflicts in the Middle East), weather-related events, or public health issues such as pandemics and the outbreak of a contagious disease like COVID-19 could also affect the markets in which we operate, our business operations and strategic plans. Political unrest may affect our sales in certain regions, such as in Southeast Asia, the Middle East, and Eastern Europe. Any of these events could adversely affect our business, results of operations and financial condition.
Risks Related to Our Common Stock
A significant majority of our voting stock is held by the Schwartz family, which could lead to conflicts of interest.
We have two classes of voting stock: Class A Common Stock and Class B Common Stock. With a few exceptions, holders of Class A and Class B Common Stock vote as a single class. When voting as a single class, each share of Class A Common Stock is entitled to one-tenth of a vote, while each share of Class B Common Stock has one vote. In the election or removal of directors, the classes vote separately and the holders of Class A Common Stock are entitled to elect 25% of the Board of Directors, with holders of Class B Common Stock electing the remaining directors. As a result of the Schwartz family's ownership of our Class A and Class B Common Stock, they are able to elect a majority of our directors, effect fundamental changes in our direction and control matters affecting us, including the determination of business opportunities that may be suitable for our company. The Schwartz family may exercise its control over us according to interests that are different from other investors’ or debtors’ interests. In particular, this concentration of ownership and voting power may have the effect of delaying or preventing a change in control of our company.
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The forum selection provision in our bylaws could increase costs to bring a claim, discourage claims or limit the ability of the Company’s stockholders to bring a claim in a judicial forum viewed by the stockholders as more favorable for disputes with the Company or the Company’s directors, officers or other employees.
Our bylaws provide that unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, if the Court of Chancery does not have jurisdiction, another state court located within the State of Delaware or, if no state court located within the State of Delaware has jurisdiction, the federal district court for the District of Delaware) shall be the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Company, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Company to the Company or the Company’s stockholders, (iii) any action arising pursuant to any provision of the General Corporation Law of the State of Delaware, the Certificate of Incorporation or the Bylaws (in each case, as may be amended from time to time) or (iv) any action asserting a claim against the Company or any of its directors, officers or other employees governed by the internal affairs doctrine of the State of Delaware. This choice of forum provision may increase costs to bring a claim, discourage claims or limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with the Company or the Company’s directors, officers or other employees, which may discourage such lawsuits against the Company or the Company’s directors, officers and other employees. Alternatively, if a court were to find the choice of forum provision contained in the Company’s bylaws to be inapplicable or unenforceable in an action, the Company may incur additional costs associated with resolving such action in other jurisdictions.
Application of the choice of forum provision may be limited in some instances by applicable law. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. As a result, the choice of forum provision will not apply to actions arising under the Exchange Act or the rules and regulations thereunder. Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder, subject to a limited exception for certain “covered class actions”. There is uncertainty as to whether a court would enforce the choice of forum provision with respect to claims under the Securities Act. Our stockholders will not be deemed, by operation of the Company’s choice of forum provision, to have waived claims arising under the federal securities laws and the rules and regulations thereunder.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
As of June 30, 2026, $206.0 million of stock remained available for repurchases under the Company's 2023 Share Repurchase Program, which was authorized by the Board of Directors in July 2023 and July 2024. Repurchases under the 2023 Share Repurchase Program may be made at management's discretion from time to time on the open market, through trading plans in accordance with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, or through privately negotiated transactions. The authorization has no expiration.
The following table contains information on the shares of our common stock that we purchased or otherwise acquired during the three months ended June 30, 2026.
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| Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number (or Approximate Dollar Value) of Shares that May yet be Purchased Under the Plans or Programs (in millions) | ||||||||||
April 1 to April 30, 2026 | 104,853 | $ | 281.78 | 104,853 | $ | 207.6 | ||||||||
May 1 to May 31, 2026 | 5,575 | $ | 277.60 | 5,575 | $ | 206.0 | ||||||||
June 1 to June 30, 2026 | — | — | — | $ | 206.0 | |||||||||
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
During the three months ended June 30, 2026, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K
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Item 6. Exhibits
(a) Exhibits
The following documents are filed as part of this report:
| Exhibit No. | |||||
| 31.1 | |||||
| 31.2 | |||||
| 32.1 | |||||
| 32.2 | |||||
| 101.INS | The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document. | ||||
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | ||||
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | ||||
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | ||||
| 101.LAB | Inline XBRL Taxonomy Extension Labels Linkbase Document | ||||
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | ||||
| 104.1 | The cover page Interactive Data File is formatted in Inline XBRL and is contained in Exhibits 101 | ||||
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereto duly authorized.
| BIO-RAD LABORATORIES, INC. | ||||||||||||||
| (Registrant) | ||||||||||||||
| Date: | August 4, 2026 | /s/ Norman Schwartz | ||||||||||||
Norman Schwartz | ||||||||||||||
Chairman of the Board and Chief Executive Officer | ||||||||||||||
| Date: | August 4, 2026 | /s/ Roop K. Lakkaraju | ||||||||||||
Roop K. Lakkaraju | ||||||||||||||
Executive Vice President, Chief Financial Officer | ||||||||||||||
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Exhibit 31.1
Certification of Chief Executive Officer Required By
Exchange Act Rules 13a-14(a) and 15d-14(a)
I, Norman Schwartz, certify that:
1.I have reviewed this Quarterly Report on Form 10-Q of Bio-Rad Laboratories, Inc.
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report fairly present, in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
| Date: | August 4, 2026 | /s/ Norman Schwartz | |||||||||
| Norman Schwartz | |||||||||||
| Chairman of the Board and Chief Executive Officer | |||||||||||
Exhibit 31.2
Certification of Chief Financial Officer Required By
Exchange Act Rules 13a-14(a) and 15d-14(a)
I, Roop K. Lakkaraju, certify that:
1.I have reviewed this Quarterly Report on Form 10-Q of Bio-Rad Laboratories, Inc.
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report fairly present, in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
| Date: | August 4, 2026 | /s/ Roop K. Lakkaraju | |||||||||
| Roop K. Lakkaraju | |||||||||||
| Executive Vice President, Chief Financial Officer | |||||||||||
Exhibit 32.1
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
I, Norman Schwartz, Chief Executive Officer of Bio-Rad Laboratories, Inc. (the “Company”), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:
(1)the Quarterly Report on Form 10-Q of the Company for the quarter ended June 30, 2026 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| Date: | August 4, 2026 | /s/ Norman Schwartz | |||||||||
| Norman Schwartz | |||||||||||
| Chairman of the Board and Chief Executive Officer | |||||||||||
The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.
Exhibit 32.2
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
I, Roop K. Lakkaraju, Chief Financial Officer of Bio-Rad Laboratories, Inc. (the “Company”), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:
(1)the Quarterly Report on Form 10-Q of the Company for the quarter ended June 30, 2026 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| Date: | August 4, 2026 | /s/ Roop K. Lakkaraju | |||||||||
| Roop K. Lakkaraju | |||||||||||
| Executive Vice President, Chief Financial Officer | |||||||||||
The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.