Operating income rose 16.6% on 9.1% revenue growth, of which 6% was organic 8-K. Higher interest expense and taxes pulled net margin down to 14.2% 8-K. Updated 2026 guidance was deferred to the call.
Thermo Fisher Scientific Inc · Q3 2026 · Reported 21 Oct 2026 · US
Key figures
Billion USD | Q3 2026 | Q3 2025 | Change |
|---|---|---|---|
Revenue | 12.14 | 11.12 | +9.1 % |
Operating income | 2.26 | 1.94 | +16.6 % |
Net income | 1.72 | 1.62 | +6.5 % |
Diluted EPS | 4.64 USD/share | 4.27 USD/share | +8.7 % |
Operating margin | 18.6 % | 17.5 % | +1.2 pp |
Net margin | 14.2 % | 14.5 % | -0.3 pp |
Figures in USD, as reported. Margins are computed from the reported lines.
Operating income grew faster than revenue, but a third of the sales growth was acquired
Revenue rose 9.1% to $12.14 billion and operating income rose 16.6% to $2.26 billion, lifting operating margin 1.2 points to 18.6% 8-K. Organic growth was 6%, with acquisitions and divestitures adding 3 points and currency adding nothing 8-K. The headline growth is therefore stronger than the underlying volume.
Management called the quarter excellent and credited its growth strategy and the PPI Business System 8-K. The company-defined adjusted operating margin was 24.5% against 23.3% a year earlier 8-K.
Lower cost ratios and two segments drove the margin gain, while amortization and restructuring weighed
Cost of revenues fell to 57.2% of revenue from 58.2%, and SG&A to 15.3% from 16.1% 8-K. Amortization of acquisition-related intangibles rose to $519 million from $435 million, and restructuring and other costs to $199 million from $135 million 8-K.
Segment income shows where the profit came from. Analytical Instruments earned $538 million at a 26.9% margin against 22.6% a year earlier, and Specialty Diagnostics earned $341 million at 31.0% against 27.4% 8-K. Laboratory Products and Biopharma Services grew revenue to $6,863 million from $5,970 million and lifted segment income to $1,067 million from $868 million, at a 15.5% margin against 14.5% 8-K. That segment is now 56.5% of revenue, and its margin is the lowest of the four, so mix limits how far the consolidated margin can rise 8-K.
Specialty Diagnostics revenue fell to $1,098 million from $1,174 million 8-K. The microbiology divestiture closed in the quarter 8-K.
Interest and taxes held net income growth to 6.5%
Net income rose 6.5% to $1.72 billion while operating income rose 16.6%, so net margin fell 0.3 points to 14.2% 8-K. Interest expense was $417 million against $347 million a year earlier, and the tax provision was $352 million against $207 million 8-K. Interest income of $252 million, up from $234 million, offset only a small part of the higher expense 8-K.
Diluted EPS rose 8.7% to $4.64, ahead of net income, because diluted shares fell to 371 million from 378 million 8-K. Company-defined adjusted EPS rose 15% to $6.68, from $5.79 a year earlier (both non-GAAP) 8-K. Adjusted EPS adds back amortization of $1.40 per share and restructuring of $0.54 per share, against $1.15 and $0.36 a year earlier 8-K.
Cash from operations rose, and restructuring charges include sizeable disposal items
Net cash from operating activities was $2,551 million in the quarter against $2,239 million a year earlier 8-K. Company-defined free cash flow was $2,115 million (non-GAAP) against $1,840 million (non-GAAP) 8-K. Over nine months, operating cash flow was $5,867 million against $4,361 million 8-K.
Restructuring and other costs in the quarter exclude from adjusted results a $72 million gain on the sale of a business and a $244 million held-for-sale loss 8-K. These disposal items are the main reason that line deserves attention.
What to watch next
Management said it would give updated 2026 financial guidance on the earnings call, so the figures sit outside the release text 8-K.
Whether the organic growth rate of 6% holds as the 3 points from acquisitions and divestitures change 8-K.
Whether interest expense of $417 million and the higher tax provision keep net margin below its year-earlier 14.5% 8-K.
The report does not give 2026 guidance figures.
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.