Ladies and gentlemen, thank you for standing by. I am Katie, your Global Meet call operator. Welcome, and thank you for joining QIAGEN's Third Quarter 2025 Earnings Conference Call Webcast. Please be advised that this call is being recorded at QIAGEN's request and will be made available on their Internet site. At this time, I'd like to introduce your host, John Gilardi, Vice President, Head of Corporate Communications at QIAGEN. Please go ahead.

Thank you, operator, and welcome to all of you who are joining us for this call for the third quarter of 2025. We appreciate your time and your interest in QIAGEN. So joining the call today are Thierry Bernard, our Chief Executive Officer; and Roland Sackers, our Chief Financial Officer. Also joining us today is Daniel Wendorff, our new Head of IR; and Dr. Domenica Martorana, from our Investor Relations team. Before we begin, I'd like to share that our next deep dive on Sample technologies is planned for Friday, November 21. The invitation was just sent out to you. So please register for the event. Domenica has done an outstanding job leading the creation of the series, and we look forward to another engaging session. As always, today's call is being webcast live and will be archived in the IR section of our website at www.qiagen.com. Here, you can find the press release and presentation accompanying this call. Please also note that this call will include forward-looking statements. Actual results may differ materially from those projected due to a number of factors outlined in our most recent Form 20-F and other filings with the U.S. Securities and Exchange Commission. We will also refer to certain financial measures not prepared in accordance with U.S. generally accepted accounting principles, or GAAP, that provide additional insights into our performance. Reconciliations to the most directly comparable GAAP figures are in the release and presentation and all references to earnings per share refer to diluted EPS. With that, let me hand the call over to Thierry.

Thank you, John, and hello, everyone. Good morning, good afternoon, or good evening to all of you joining us from around the world. I'd like to start by thanking the QIAGEN teams across our company and across the world for their ongoing dedication and strong execution in this challenging macro environment. Their focus and collaboration enabled us to deliver another solid quarter. In fact, the 24th consecutive quarter in which we met or exceeded our targets. We continue to see the clear merits of our strategy to prioritize high-growth areas of molecular research and testing while maximizing the reach of our portfolio to customers across both the life sciences and diagnostics. This approach continues to provide balance and stability even in those very volatile and uncertain conditions. This performance in 2025 also enables us to advance key capital allocation initiatives that are strengthening our business and creating value. Two important developments were announced yesterday. First, the acquisition of Parse Biosciences that expands our Sample technologies portfolio into the very fast-growing AI-driven single-cell market. Second, a $500 million synthetic share repurchase to be completed in January 2026 that will bring total shareholder return since 2024 to above our 2028 goal for at least $1 billion return to shareholders. We remain strongly committed to our 2028 ambitions even again, in this challenging environment. We have significantly strengthened key pillars in our portfolio and continue to position QIAGEN towards our 7% sales CAGR target from '24 to '28. We are also on track to move well above our 31% adjusted operating income target by the end of 2028 despite currency and integration headwinds. So we are combining top execution with decisive actions to deliver solid profitable growth. So let me walk you through our key messages for today. First, we once again exceeded our targets for the third quarter and delivered one of the fastest growth rates in our industry. Net sales rose 6% to $533 million, while results at constant exchange rates were up 5% and ahead of our 4% CER target. More importantly, core sales, excluding recently discontinued products, increased 6% CER over the prior year period. Adjusted diluted EPS was $0.61 at both actual and constant exchange rates and therefore, above our outlook for at least $0.58. Those results, again, underscore the strength of our differentiated portfolio and the success of our efficiency initiatives in delivering a consistent performance quarter after quarter over the past six years. Second key message: our growth pillars continue to perform strongly in 2025. QIAstat diagnostics grew 11%, driven by strong instrument placements and double-digit consumable growth on demand across our clinical syndromic testing panels. QuantiFERON also grew 11% CER, supported by continued latent TB conversion from the skin test and broader adoption worldwide. Sample technologies returned to growth with sales rising 3% CER on demand for automated consumables despite cautious capital spending. QIAcuity, our digital PCR platform, maintained double-digit CER growth with robust consumable demand more than offsetting slower instrument sales among life science customers. And QIAGEN Digital Insight, our bioinformatics portfolio, delivered solid double-digit growth, driven by growing demand for clinical bioinformatics and also the integration of Genoox, which has further enhanced our growing edge of AI-driven solutions for interpretation of clinical next-generation sequencing data. Third key message. Our strong performance so far in 2025 is allowing us to again raise our earnings target while confirming our sales outlook. This reflects the success of our efficiency initiatives and disciplined execution. Despite currency headwinds and the adverse impact of tariffs and the current U.S. government shutdown, we continue to improve profitability and maintain solid growth. This is fully aligned with our 2028 ambitions for solid profitable growth. Therefore, we now expect adjusted EPS of about $2.38 CER, an increase of $0.10 from our initial guidance for 2025. At the same time, we continue to expect net sales growth of about 4% to 5% at constant exchange rates. And more importantly, 5% to 6% CER growth for our core portfolio. This is definitely another solid and strong quarter demonstrating consistent execution, operational discipline, and clear strategic direction. And lastly, let me briefly address the announcement about our leadership transition. After more than 10 years with this remarkable company, including six years as CEO, I and our Supervisory Board have agreed that this is the time to prepare for QIAGEN's next phase of growth. This decision comes after deep reflection and with full confidence in the strength of our company, the strength of our strategy, and above all, the quality of our people. I will obviously continue to lead QIAGEN until a successor is appointed to ensure a smooth and orderly handover. My focus remains unchanged: executing on our strategy, delivering on our 2025 goals, and advancing our 2028 ambitions for solid and profitable growth. It is a real privilege to serve QIAGEN and to work alongside such talented and dedicated colleagues. And I'm really confident that our company is well positioned for its next phase of growth. With that, I'll hand it over to Roland for more on the financials.

Thank you, Thierry, and hello, everyone. Let me start with a few key financial highlights. First, QIAGEN remains one of the fastest-growing companies in our industry as core sales rose 6% at constant exchange rates. Second, profitability remains strong. Our adjusted operating income margin for the third quarter of '25 was steady at 29.6% of sales, 30% at constant exchange rates absorbing more than 150 basis points of headwinds from currency movements and the impact of U.S. tariffs. Earnings per share at CER were $0.61 and well ahead of the outlook for at least $0.58. Third, cash generation was also strong with underlying operating cash flow of $466 million for the nine months of '25, including about $45 million in cash restructuring payments. Fourth, our balance sheet remains strong, giving us the flexibility to invest in innovation, pursue targeted bolt-on acquisitions like Parse, and to increase returns to shareholders as we are doing with our $500 million synthetic repurchase set for completion in January '26. We have a long-standing capital allocation strategy that has created value by directing resources to the highest return opportunities. Based on this new repurchase program, we are well ahead of our target to return at least $1 billion to our shareholders by the end of '28. We also anticipate that our leverage rate, our net debt to adjusted EBITDA ratio will move towards the industry average of approximately 2x during '26 as we consider additional capital allocation in the new year. Now let me take you through the details. In terms of sales results, among the four product groups, Sample technologies rose 3% CER and was driven by consumables growth, especially automated kits that showed double-digit expansion compared to the year-ago period. Instrument sales were slightly lower but included good placements of the QIAsymphony, QIAcube Connect, and EZ2 Connect systems. In Diagnostic Solutions, sales rose 4% at CER, but at a faster 8% excluding the discontinued NeuMoDx system. The top performers were QIAstat and QuantiFERON, both growing 11% CER and supported by further expansion of our companion diagnostic pharma partnerships. In PCR and nucleic acid amplification, sales were stable compared to the third quarter of '24 at constant exchange rates. Our digital PCR platform QIAcuity continues to grow as strong demand for consumables more than offset lower instrument sales amid cautious life science spending. In the genomics and NGS product group, sales were up 9% CER and led by the QIAGEN Digital Insights bioinformatics business. QDI sales grew at a double-digit rate through a combination of sales growth from the current business and first-time contributions from the Genoox acquisition. Consumables for universal NGS panels also grew over the year-ago quarter. Turning to the regions. Sales in the Americas rose 7% CER supported by strong growth in the U.S. against lower sales in Brazil and Mexico. In the EMEA region, sales grew 4% CER, led by Germany, France, and Italy along with the Nordic region. The Asia Pacific region declined 2% CER, reflecting a mid-teen CER decline in China over the same period in '24 against higher sales in India, South Korea, and Australia. Moving down the income statement, adjusted operating income grew in line with sales and reached $158 million as the adjusted operating income margin remained at 29.6% of sales compared to the third quarter of '24. R&D investments were 9.2% in the third quarter, compared to 8.9% in the year-ago period. The majority of our R&D spending continues to focus on our pillars. This includes the upcoming launches of three new sample prep instruments, new panels for QIAstat-Dx, the expansion of QIAcuity applications in research and the clinic, and also the development of the fifth generation for QuantiFERON. Sales and marketing expenses showed the benefit of efficiency gains declining about 1 percentage point to 21.2% of sales from 22.2% in the third quarter '24, while our teams maintained an ongoing high level of customer engagement. General and administrative expenses declined slightly to 5.7%, compared to 5.9%, showing continued cost discipline while investing in IT upgrades, such as the SAP system migration. Adjusted diluted EPS was $0.61 at constant exchange rates, exceeding the outlook for at least $0.58 CER. The adjusted tax rate was 18%, and this was consistent with our target. Moving to cash flow. We saw an ongoing high level of cash generation for the first nine months of the year over the same period in '24. Operating cash flow was $466 million for the '25 period, compared to $482 million in the same period of '24, but the '25 results included about $45 million of cash restructuring payments related to the efficiency and portfolio initiatives. Free cash flow was USD 336 million, which was slightly below the same period of '24 due to the higher levels of planned capitalized IT investments. Accounts receivable declined to about 53 days compared to about 56 days at the end of '24 as our teams continue to improve in this area. At the same time, days of inventories were 151 days at the end of the third quarter of '25 compared to 193 days at the end of '24 and again reflected benefits from our efficiency initiatives. The improving level of profitability and strong cash flows is further strengthening our healthy balance sheet. This gives us the opportunity to make disciplined decisions to invest in innovation, pursue targeted bolt-on acquisitions, and increase returns to shareholders, as you saw with the development. This is complemented by our decisions to increase returns to shareholders with a new repurchase set for completion on or about January 7, 2026. This $500 million return program comes after we completed a $300 million synthetic share repurchase in January and also paid our first annual dividend of $54 million in July. Based on this capital allocation decisions announced and also our considerations for further deployment in '26 through attractive return opportunities, we expect QIAGEN's leverage ratio to move towards the industry average of about 2x net debt to adjusted EBITDA. In closing, our strong financial position supports our commitment to solid profitable growth. We are deploying resources in areas offering the highest returns, all designated to improve our position to deliver on our '28 ambitions and create long-term value. With that, let me hand the call back to Thierry.

Thank you, Roland. And as usual, let's have a look at the progress across our product portfolio, particularly focusing on our pillars of growth. You probably remember that we are targeting around $1.490 billion in combined sales from our five pillars for 2025, representing a growth of around 8% CER. So based on the results to date in '25, we remain well on track to achieve the goal for this group. Let's start with Sample technologies. We continue to advance our next wave of automation and have taken an important step with the acquisition of Parse to extend this leadership by moving into new technologies. Regarding the upcoming instrument launches, those are perfectly on track. QIAsymphony Connect has now been installed at the first customers, and the initial feedback has been very positive about the performance and enhanced connectivity. QIAmini and QIAsprint Connect also both remain on schedule for launch in 2026 and early field tests for QIAsprint Connect are confirming very strong demand for an advanced high-throughput solution. It is indeed extremely interesting to note that we have already received purchase orders for QIAsprint Connect. We have also recently marked the 4,000 placement of QIAcube Connect, reaffirming our leadership in automated sample processing. Beyond automation, we are expanding the reach of our Sample technologies portfolio with the acquisition of Parse, a pioneering scalable instrument-free single-cell analysis. Parse has developed a breakthrough instrument-free combinatorial barcoding technology that removes the need for a droplet-based system and enables analysis of millions or even billions of cells instead of thousands. This enables delivering more insights at a fraction of the cost. Parse solutions are already used by more than 3,000 laboratories worldwide, including every top pharmaceutical company and leading research institutions. So this acquisition is really opening up new dimensions for QIAGEN in this fast-growing single-cell market and fits perfectly with our Sample to Insight strategy. Parse also creates synergies with our QDI bioinformatics business connecting large-scale single-cell data generation with powerful AI-driven interpretation. Together, we can accelerate discovery, build virtual cell models, and help researchers unlock new frontiers in AI-based drug discovery and next-generation biology. So tune in for our Sample technologies deep dive session on November 21, and you will learn more about the exciting area of our portfolio. Turning now to QIAstat. We continue to expand our syndromic testing portfolio worldwide with the launch of a new instrument version in the U.S. and we are preparing for more panel submissions in 2025. In September, we received the U.S. FDA clearance for QIAstat Diagnostic Rise, the higher throughput version of our syndromic testing platform. QIAstat Diagnostic Rise automates up to 18 tests simultaneously processing as many as 160 samples per day with very minimal hands-on time. So this high-volume version is particularly attractive to our largest customers. Also, in the third quarter, we were well above 150 QIAstat placements, which is once again a testament to the continued growth and stronger customer adoption of the QIAstat system. When it comes to menu expansion, we remain perfectly on track to submit the blood culture panel in the U.S. and in Europe by the end of 2025. On QIAcuity, our digital PCR platform, we continue to expand the assay menu and we are on track to sell at least 1,000 new assays in 2025. So now back to Roland with the details on our outlook for the year.

Thank you, Thierry. Let me now turn to the outlook for the rest of '25. We continue to expect another year of solid profitable growth as our teams drive operational efficiency and disciplined execution across the portfolio. For the full year, we are reaffirming our outlook for total net sales growth of about 4% to 5% at CER. The expansion remains broad-based across the business. More important, our core portfolio is expected to grow about 5% to 6% CER, since this excludes sales from discontinued products. You saw that impact on our results for Q3 '25 with gross sales rising 1 percentage point faster than total sales. Additionally, we raised our target for adjusted earnings per share to about $2.38 CER, reflecting our ability to improve profitability faster than sales while absorbing the headwinds of currency movements and U.S. tariffs. This marks an increase of $0.10 in our adjusted EPS target from the start of 2025. For full year '25, we continue to anticipate tariffs to create a relative headwind of about 90 basis points on the adjusted gross margin as we work on implementing various mitigation actions. Now on to the fourth quarter where we have decided to take a view that the impact of the U.S. government shutdown continues until the end of the year. In light of that factor and also the current macro trends, we are targeting total net sales to be steady at constant exchange rates compared to the fourth quarter of '24. For our core sales, we are driving about 2% CER. Adjusted EPS is expected to be about $0.60 at constant exchange rates. As we look at the currency impact market trends, for the full year, we continue to expect a positive impact of about 1 percentage point of net sales but an adverse impact of about $0.02 on adjusted EPS. For the first quarter, currency movements are expected to have a positive impact on net sales of about 1 percentage point but an adverse impact of about $0.01 on adjusted diluted EPS. On a separate note, I'm pleased to introduce Daniel Wendorff, who joined QIAGEN as of November 1 as our new Vice President and Head of Investor Relations, reporting directly to me. Some of you may know Daniel from his prior role at the Investor Relations team at Merck in Germany and earlier as a research analyst covering QIAGEN and the life science sector. He joins a strong IR team. John Gilardi will continue in his role as Vice President, Corporate Communications. With that, I would like to now hand the call back to Thierry.

Thank you, Roland. So we are coming to the end of our call. To give you a quick summary, QIAGEN definitely delivered another strong and solid quarter, once again exceeding our outlook. And just as important, we took decisive action to strengthen our portfolio and increase returns to shareholders, all aligned with our 2028 ambitions. Our differentiated pillars, mainly serving the continuum from basic research to clinical diagnostics, continue to perform very well. New product launches and additions to our portfolio are on the way to create new relays of growth. We definitely remain focused on creating value through profitable growth, operational excellence, and disciplined capital deployment, while maintaining flexibility to pursue attractive acquisition opportunities like Parse. With the increase to our adjusted EPS target for 2025 and the new $500 million share repurchase, we are definitely delivering on our commitments to value creation by positioning QIAGEN for continued momentum as a top performer in 2026 and way beyond. With that, I would now like to hand back to John and the operator for the Q&A session. Thanks a lot for your time.

We'll take our first question from Jack Meehan with Nephron Research.

And congrats, Thierry, John, enjoyed working together, but I doubt this will be the end. For my question, I wanted to focus on the Parse acquisition. Just had a few questions on that. Just first, if you could talk about how the deal came together and what brought them to the top of the list of targets as you consider tuck-in M&A? And then if you look at the competitive landscape for single-cell, it's very competitive, kind of have an entrenched leader with 10x. And then Illumina talks about instrument-free approach with Fluent. So if you could just talk about the differentiation of the technology and kind of why it's better in QIAGEN's hands and what you can do with it, that would be great.

Thank you, Jack, and thanks for your nice comments. So first of all, for me and for the company, the acquisition of Parse is a typical and very good example of a very good use of our cash for a strategic bolt-on acquisition. First, it is strategic; second, it is extremely synergistic with our existing portfolio; third, it is accretive to our top-line growth; and fourth, it will be accretive to our financials in a very reasonable time frame, in less than three years. But because there are different knowledge around Parse, let me come back first on what Parse offers and what could be the everyday applications. This is a company that we have been following since 2017. We have always believed at QIAGEN that single-cell was a natural extension to our sample prep technology. Since we know them, what has amazed at QIAGEN is that they have constantly executed on what they told us they would deliver, either growth or product development. Let us remember first that single-cell analysis is literally turning biology from a blurry group photo into a real sharp portrait of every individual cell. As a result, scientists all over the world, can now study millions to billions of cells at once, for example, to try to see which ones are driving cancers. Other technologies group all the cells together, so researchers cannot really see which specific cells are actually causing the disease. Parse makes this level of insight completely possible. We will combine this with AI-driven tools from our QDI portfolio. So why did we select Parse? There was no way for QIAGEN, obviously, to invest in a me-too product or portfolio of solutions. First of all, Parse is the fastest-growing company in single-cell analysis and is a very natural extension of our sample prep portfolio. Examples: parse is already present in more than 3,000 labs in the world. Second, Parse offers an instrument-free kit, allowing any lab to use it without costly hardware. Third and perhaps more importantly, Parse differentiates because it can process millions to billions of cells, far more than any other system and far more than the competitor that you mentioned. As a result, we consider that it is a very natural fit for Sample tech, but also with synergies with our QDI and also next-generation sequencing chemistry. Does this answer your question? Jack, does it answer your questions?

It does.

We will take our next question from Hugo Solvet with BNP Paribas.

I'd like to focus on QIAstat, please. Can you talk to the traction for the new panels, gastro and meningitis? And how do you see them driving an acceleration going forward? And as some of the instruments placed during COVID will likely arrive at the end of their life cycle soon, can you maybe talk to the opportunity for potential market share gains here?

Thank you, Hugo. So QIAstat continues to deliver. I mean, it's very interesting to see again an 11% growth in Q3. And we all know that Q3 is always normally a kind of softer quarter for QIAstat. Why? Because the syndromic testing market is still driven by respiratory panels, and we all know that in most of the western world, Q3 is rather a low time for respiratory infections. So 11% growth in Q3, 150 more placements of system is a good performance. Respiratory panels are 70% of the syndromic market. But it's very interesting to see at QIAGEN that the growth of our GI panels and meningitis, especially where we can grow, like, for example, in the north of Europe or in North America or in the Middle East. For GI and for meningitis, Hugo, we are growing at more than double digits. This is very encouraging, especially in the U.S. I remind you all that the U.S. is still the main market for syndromic testing. So yes, as you said, obviously, some of the customers that we installed during COVID will come from renewal, and basically renewing with once again QIAstat is the perfect choice. Why? Because since COVID, they have much more panels opportunities, and they will get more in 2026 with the launch of the blood culture panel. And the complicated UTI by the end of '26 for Europe and '27 for the rest of the world. So we are well on track to execute on our guidance for 2025. And for syndromic testing, Hugo, we will definitely beat our mid-term guidance that we gave in our Capital Market Day in New York, which was, as you remember, $200 million revenues by 2028. I continue to say with the rest of the company that in syndromic testing, QIAGEN will be a very solid and competitive number two in the market.

We'll take our next question from Doug Schenkel with Wolfe Research.

I have a couple of quick questions regarding the diagnostic side. First, with QIAstat-Dx, you now have three key panels—respiratory, GI, and meningitis—approved in the U.S. I'm curious about how these have contributed to platform growth since approval. I know it's still early, but are placements and utilization meeting your expectations? Additionally, regarding QuantiFERON, you've effectively communicated with the investment community this year about the importance of the automation capabilities made possible through your partnership with DiaSorin. I was wondering if there’s been any notable competitive disruption to the franchise recently, either through the partnership or in general, given that the performance looks quite strong.

So I think the main example that I can give for the impact of those three panels on our U.S. performance for QIAstat is, as we already disclosed at the end of Q2, Doug, we placed more instruments in six months in the U.S. in 2025 than we did in the full year of '24. I think this is the best estimate that those three panels now are really helping. In addition to that, we have reshuffled the team. We have dedicated sales reps for QIAstat in every territory in the U.S. So that helps. So in '25, we are going to exceed our target for instruments for the U.S., and the growth is very solid. So I'm very confident. On QuantiFERON, I keep the same approach together with the team. We always believe that competition would come one day to this market. And this is why for the last ten years, Doug, we have prepared for that. Even when there were no names or no precise dates, we are prepared. This is why we built that automation partner with DiaSorin, but not only with DiaSorin but also Tecan and Hamilton. This is why we consistently improve the technology itself. We are now at the fourth generation of QuantiFERON. And this is why also we continue to focus on what is still today the main competition, which is the skin test. I remind everybody once again that we still have to convert more than 50 million skin tests in the world. If you just take the U.S., it's around probably just a bit more than 15 million skin tests that we need to cover. And we are prepared. We are prepared. Last thing I would say that makes me very optimistic for QuantiFERON, Doug, is that despite those good results, despite the fact that we continue to grow at double digits, we continue to prepare the future. I started to speak about this in our Q2 earnings. Expect in the coming weeks and months to see announcements improving the workflow of QuantiFERON, the ease of use, and we are also working on further enhancements of the test. So there is no complacency in our approach. We are number one, but we know that we need to defend this disposition, and we are ready. We are ready commercially and also from a product standpoint.

Thierry, I don't know if you could still hear me, but if you can, I just want to thank you for those answers and more importantly, for all the great work you've done over the years. You've really done a great job through a tough period in the industry, bringing a new level of discipline to the company. So I really appreciate that. And thanks for everything. We look forward to seeing you in a few weeks.

This is very humbling. Thank you.

We'll take our next question from Casey Woodring with JPMorgan.

Great. Maybe just to start on academic and government. Maybe just walk through if you can quantify what the shutdown impact is on the quarter. I know that you're assuming those shutdowns for the entirety of the quarter in Q4. And then some of your peers have talked about European academic and government spend improving in Q3 and taking a bit more optimistic stance there on the forward outlook. So just elaborate on what you're seeing in academic and government maybe between regions?

Yes, thanks for the question, Casey. I mean, obviously, the new events since we had a quarterly release is that we are in a shutdown in the U.S. And it's fair to acknowledge as well that nobody, and believe me I ask many other CEOs, you probably know that I'm still chairing our industry association in the U.S., and nobody knows when it's going to stop. So we took a conservative assumption, which is, okay, we are going to be in the shutdown probably until the end of the year. If it stops before, we might see an improvement in our target so far, but let's take cautious and realistic approach. So obviously, the shutdown has an impact on our sales because it impacts, obviously, an already constrained environment in academia and research, where we know that people were very cautious to spend on capital expenses, but sometimes on consumables. I believe that QIAGEN is able to mitigate that impact for some reason. First of all, because while we are not immune, obviously, to it, but I believe that we sell products of very high value for these academia and research labs. So it's very difficult to basically not use our product. Second, we do not sell huge price tag instruments, for example. So our solutions are, first, very important. Second, it's not a big budget, but we see an impact. This is an impact on sales of consumables on a daily basis, and this is an impact also on sales of instruments. But overall, I think it's under control. It's fully factored in our current guidance. And I remind you, Casey, in that environment, unlike many competitors or peers, we have maintained our guidance for the year, top line. Moreover, we have also improved our guidance from a profitability standpoint. I think this is a testament to the strength of the company.

Understood. And would just reiterate what Doug said, Thierry.

We will take our next question from Aisyah Noor with Morgan Stanley.

My one is on tariffs. So thank you for the guide of 90 bps impact on the margin. Are you able to be a bit more explicit about the dollar value of these tariffs, whether these are gross or net of mitigation efforts and whether we can annualize this impact for 2026?

Thank you, Roland, would you like to take this one?

Yes, of course. The 90 basis points this year reflects the net impact. Looking ahead, we have ongoing mitigation efforts in place, and we do not expect an increase in next year's mitigations, especially early in the year. Based on the information we have today, and understanding that circumstances can change rapidly, we do not foresee this becoming a larger impact for us.

Okay. If I could follow up on that, on the pricing dynamics. These tariff surcharges that you're placing on your products, we're hearing from some of your peers that there could be some resistance to the surcharges that are being passed through, potentially resulting in some delay or push out of demand into the next quarter. Just curious, is this something you're seeing? Or are you comfortable that these surcharges are passing through?

I believe we can both address this question. I've been in this field for over 20 years, and it's always a negotiation when it comes to implementing price increases. Customers who recognize the value we provide understand this, especially since QIAGEN invests 10% of our sales in R&D. The surcharge due to tariffs is not just a price increase; it's something we have communicated clearly to our customers. While these discussions are challenging, we have explained our reasoning and the necessity of sharing the burden. This approach has yielded results for us this quarter. It's never easy, but we have not observed customers postponing decisions because of this. It is a discussion, and we maintain a pragmatic approach, respecting our customers while also emphasizing the need to pass along these costs. I think Roland has some additional points to add as well.

No, I think you covered it very well, Thierry. At the end of the day, again, it depends. It is nothing what we do. Again, we clearly look at where we have pricing power, in which region, which product, what are the contracts? For us, more important is that, I would say, again, if you look at the financial results of this year, that we balanced it out quite well. We were able to increase EPS one more time. Now we are $0.10 up. If you look at the overall margin expansion for QIAGEN, again, I just want to remind everybody, I know I'll show that you know it quite well. In '23, we ended the fiscal year with an adjusted EBIT margin of 26.9. In '24, we ended the year with an adjusted EBIT margin of 28.7. For this year, again, if you do the forecast, CER, we end with an EBIT margin of 30%. So we have now in less than 24 months, an EBIT margin improvement of 310 basis points. I think that speaks for itself how we're able to manage it, including clearly headwinds like U.S. tariffs.

We'll take our next question from Patrick Donnelly with Citi.

Thierry, my congrats as well on a great run. Can you just talk about your high-level, the moving pieces we should be thinking about for '26? Obviously, the Q4 exit rate has a little bit of the shutdown in it. So just trying to think about high-level the approach into '26, both on revenue maybe for you, Thierry. And then Roland, I know you touched on the margin there. Anything high-level we should be thinking about as we head into next year?

Yes. I think, again, talking about the margins, let me kick it off also on Q4. As I just said, we are probably ending the year with a margin CER-wise of 30% for the fourth quarter also, while it's clearly a more challenging quarter in terms of the U.S. shutdown, we still expect also at constant exchange wise, an EBIT margin of 29.5%, so still quite high. Yes, we have a bit more currency impact, negative impact in that quarter. But nevertheless, I would say it's still quite strong. I think that also makes us confident for next year. For me, it's very clear that we also expect an underlying margin improvement, not only for '26. I know that you're all expecting us that we will update the margin for '28, and we're going to do so and you will see a significant increase there. But of course, I don't do that today. The one thing, of course, I want you to have in mind is why we will have an underlying margin improvement next year. It's quite obvious that as we just talked about, tariffs are, to a certain extent, still some headwind. And of course, the Parse acquisition is also to a certain extent, a headwind. Nevertheless, we will more or less go into the year similar to what we did this year. I do think we had a good one this year so far.

Thank you, Patrick, for your comments. Our perspective as a team is straightforward. Two years ago, we made a commitment to the market with a clear objective: to achieve 7% sales growth CAGR, a 31% EBIT margin, and generate $2 billion in revenues from our growth pillars. Management's priority and focus is to ensure we deliver on this, regardless of market conditions. It's evident that since our last Capital Market Day, sales are becoming more challenging, as reflected by our competitors who have downgraded their outlook or adjusted their growth projections. We believe that if the situation does not improve by 2026, we may be positioned for around 5% growth, slightly exceeding that thanks to the acquisition of Parse. If conditions do improve, given our organic portfolio and the contributions from Parse, we could see growth between 5% and 7%. This is not a guidance call; we are simply providing insights. We are monitoring the situation closely. It’s important to note that our management team, not just Thierry, is committed to making strategic moves with cash generation and our balance sheet to enhance products like Genoox and Parse, while also taking steps to further improve profitability. In summary, we aim to position QIAGEN to meet market expectations for EPS in 2026, regardless of the surrounding environment.

We will take our next question from Luke Sergott with Barclays.

Can you discuss the plans or investments related to the Parse acquisition, particularly regarding automation or any aspects of your existing portfolio that could enhance scalability or usability for a wider customer base?

Thanks. It's already very user-friendly. This is particularly impressive for a young company with over 3,000 customers globally, which is a significant achievement. One of the main advantages is that it is completely instrument-free, enhancing its customer-friendliness. Additionally, Parse has developed a giga lab capacity to meet higher throughput and volume customer demands, which I find interesting. There are numerous immediate synergies; for instance, someone selling Sample tech at QIAGEN can also sell Parse offerings. Many from Parse can likewise sell and utilize our Sample tech portfolio and QDI solutions. Furthermore, we are inherently a more global company than Parse, allowing us to expand our geographic reach. It is essential for us to continue supporting this portfolio with R&D investments, and both teams will collaborate to explore further synergies in development, ensuring a seamless integration of solutions from Sample tech, QDI, and our sequencing chemistry. Additionally, we should not overlook that a key driver from this acquisition is the enhanced dimension we gain with AI in our portfolio.

Okay. That's helpful. And then I guess from a QIAcuity perspective, you talked about the consumables up double digits. Can you just break out what you're seeing there for across the biopharma side? Like how much of your QIAcuity piece is actually being sold into that market versus the A&G market? And then a follow-up on just what you're seeing from a competitive dynamic versus especially the new offerings from the droplet technologies?

So once again, I mean, as usual, we deeply, I'm sorry, respect our competition. What we see is that our direct competition is basically presenting numbers that are not really comparing to our performance. We are still double-digit that we continue to invest. I said during the call that it's a significant number of new applications in academia and research every year that we are making available for our customers. You know that the solution is also now available for clinical customers, what we call QIAcuity Diagnostic. We see a very good performance from our companion diagnostic. From direct customers, usage such as biopharma, QC controlled by pharma is boosting way over double digits, and pharma customers are becoming a significant segment of customers, and they are very interesting. Why? Because, first of all, their throughput; their volume of consumables is higher than any other segment, and they are very demanding customers. Second, the portfolio of companion diagnostics, digital PCR-based, is even surprising to us in full transparency. It's growing very fast. I remind you this positions QIAGEN very well because we are the only company at this moment able to offer to biotech and pharma companies companion diagnostic solutions that are PCR-based, NGS-based, or digital PCR-based. We are confident. Double-digit is a good performance. We are a bit impacted by this low capital expense environment. So we feel it in our number of placements. But once again, what are we talking about? We are still placing above 100 systems per quarter, and this is good for the future of digital PCR because those placements are going to generate, obviously, consumables.

We will take our final question from Jan Koch with Deutsche Bank.

My first question is about the announced acquisition of Parse. Could you provide more details on the gross and EBIT margin profile of the business? If my calculations are correct, it seems you anticipate no EBIT contribution from this asset in 2026. Additionally, could you explain the specific milestones needed to trigger the extra $55 million payment? My second question is regarding the Sample tech business. It's great to see that business returning to growth in Q3. However, did you experience any one-off benefits in the quarter? What growth do you anticipate for Q4 considering the government shutdown?

Very good. Thanks for the question. I will ask Roland to take the financials on Parse from a contribution to our financials, and then I will address the Sample tech question. Roland?

Yes. I do think, again, what we announced is as you've seen that we expect a dilution of about $0.04 for '26, while we expect revenues of about $40 million. If you do the math, you really can see it has an EBIT dilution, of course, also for that year. Nevertheless, we do expect it becomes accretive in '28. It is a significant growth opportunity. Again, the revenue growth rate is quite exciting. So yes, it is dilutive EBIT margin-wise for next year, and it's something we have to eat, and we were clearly trying to balance this underlying to compensate and maybe even to overcompensate for that. But I would expect on the mid-term, there is a nice equation coming up as this business has healthy gross margins for QIAGEN, and therefore, the revenue growth rate is going to help.

Thank you, Roland. And for Sample tech, there are no one-offs in Q3. I hope that you will be able to attend our deep dive on the 21st because there, we will go into details showing you, I hope, and demonstrating that we are perfectly executing on our strategy. What is the strategy? For the last four years, we have really invested in further automation. QIAcube became QIAcube Connect. EZ1 became EZ2. QIAsymphony Connect is currently being installed. In the first semester of '26, you will have two new instruments with QIAmini and QIAsprint Connect. Automation is the way to go. Second is investing into very high-added-value applications. The first that comes to my mind, obviously, is liquid biopsy. This is not a number that we publish a lot. But do you know that Sample tech liquid biopsy by QIAGEN is growing way over double digits? When I say double digits, I'm not talking about the ten marks, way over that. This is where we need to invest. And third is investing into technologies of the future; the demonstration is Parse. There is no time off. I expect that for the full year 2025, especially because of the shutdown, we will be basically overall flattish for the year, but I continue to confirm our ambition to grow in the '28 objective because those instruments are going to help. They are perfectly factored in the ambitions that we gave you back in New York two years ago, which is roughly a 3% growth rate and reaching $750 million in revenues.

Okay. Thierry and Roland, thank you very much. With that, I'd like to close this conference call. Again, thank you for your participation. If you have any questions or comments, please don't hesitate to reach out to us. Thank you.

Ladies and gentlemen, this concludes the conference call. Thank you for joining, and have a pleasant day. Goodbye.