GAAP EPS rose 34.6% to $1.71, but a $263 million discrete tax benefit did much of the work and operating margin was flat at 19.0% (non-GAAP) 8-K. Company-defined adjusted EPS grew 11.5% (non-GAAP) and full-year guidance rose 8-K.
Danaher Corporation · Q3 2026 · Reported 21 Oct 2026 · US
Key figures
Million USD | Q3 2026 | Q3 2025 | Change |
|---|---|---|---|
Net revenues | 6,554 | 6,053 | +8.3 % |
Operating income | 1,245 | 1,154 | +7.9 % |
Net income | 1,235 | 908 | +36.0 % |
Diluted EPS | 1.71 USD/share | 1.27 USD/share | +34.6 % |
Operating margin | 19.0 % | 19.1 % | -0.1 pp |
Net margin | 18.8 % | 15.0 % | +3.8 pp |
Figures in USD, as reported. Margins are computed from the reported lines.
GAAP earnings growth came mostly from a tax benefit, not operations
Net earnings from continuing operations were $1,207 million against $908 million a year earlier, but earnings before income taxes rose only to $1,132 million from $1,076 million 8-K. Income taxes were a $75 million benefit against a $168 million expense, and the release cites net discrete tax benefits of $263 million, mainly reserve releases after audit settlements 8-K.
Operating profit rose 7.9% to $1,245 million, while operating margin was 19.0% (non-GAAP) against 19.1% a year earlier 8-K. Interest expense doubled to $135 million from $67 million, and the release names debt incurred for the Masimo acquisition as a risk factor 8-K. Company-defined adjusted EPS grew 11.5% (non-GAAP) to $2.11 from $1.89 a year earlier, with the discrete tax item removed 8-K.
Acquisitions inflate the headline, but core growth excluding respiratory improved
Sales rose 8.3% to $6,554 million, and acquisitions and divestitures contributed 6.5 points of total company growth 8-K. Diagnostics grew 17.0% in total, of which 16.5 points came from acquisitions, leaving core growth of 0.5% 8-K.
Company-defined core growth was 3.0%, or 5.5% excluding respiratory testing, against 4.5% in the prior quarter ended June 2026 and 2.5% a year earlier 8-K. Respiratory sales were about $350 million against $500 million a year earlier, a headwind of 2.5 points to company core growth 8-K. Tariff refunds to customers, now excluded from core, took 1.0 point off total growth 8-K.
Cash flow grew, but conversion of earnings fell and guidance rose modestly
Operating cash flow was $1,886 million against $1,662 million, and company-defined free cash flow rose 19.0% (non-GAAP) to $1,632 million (non-GAAP) 8-K. Free cash flow was 1.35 (non-GAAP)times net earnings from continuing operations against 1.51 (non-GAAP)a year earlier, a ratio depressed by the tax-inflated earnings denominator (my reading) 8-K.
Management raised full-year adjusted EPS guidance to $8.57 to $8.62 from $8.45 to $8.60 8-K. For the fourth quarter it expects core growth excluding respiratory of 4.0% to 5.0%, with respiratory a headwind of about 150 basis points, leaving core growth near 3.0% 8-K. The release does not give segment margins or balance sheet detail; those come with the 10-Q.
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Sources
Produced by Clarifo Research with the Clarifo financial research engine from the company's public filings. AI was used in parts of the analysis and drafting. Figures are checked automatically against the filings they come from. This is not investment advice.