Jul 31, 2026 earnings call — Organic growth, improved outlook and margins
Company raised full-year adjusted EPS guidance to $47.15 to $47.50.
Revenue $1.0B (est $1.0B) · EPS $11.46 (est $10.85)
Key quotes
"Our second quarter results were strong and reflected better-than-expected organic sales growth across our portfolio, including very good growth in China and emerging markets."
"Adjusted EPS for the year is forecast to be in the range of $47.15 to $47.50, which represents a growth rate of 10% to 11% or 11% to 12%, excluding currency."
"Excluding unfavorable foreign currency and acquisitions, gross margin expanded approximately 90 basis points due to benefits from favorable price realization, lower tariff rates compared to the prior year, volume growth in our productivity and cost savings initiatives, partly offset by higher transportation costs."
Analyst Q&A 11
China growth and product inspection timing
Q (Daniel Arias): Analyst asked why China growth accelerated and whether pharma is driving it, and asked about timing and demand for Product Inspection (PI).
A: Management said China growth was strong and led by Industrial, with pharma a meaningful part but Lab improving more modestly and expected to improve in the second half. They guided China to high single digit for Q3 and the full year and said Lab and academia may pick up later. On Product Inspection they said Q2 was light due to project timing, expect mid-single-digit growth in Q3 and high single-digit for the full year (mid-single-digit organically), with 70% of PI serving food manufacturing and new products and mid-market strategy helping demand.
"Yes. Dan, then just to be specific, like in terms of the second half of the year, we're looking at high single digit now for China also for Q3 and for the full year." — Shawn Vadala (CFO)
Segment and region assumptions; pricing and chemicals
Q (Tycho Peterson): Analyst asked for the assumptions by product category and region for the back half, and then asked about pricing realization and delayed chemical orders.
A: Management gave category guidance: Lab Q3 mid-single digit; Core Industrial Q3 low single digit (with a hard prior-year comp); PI Q3 mid-single digit; Retail flat. Regionally they guided Americas low to mid-single digit, Europe low single digit, and China high single digit, and gave full year category and region ranges including acquisition effects. On pricing they said price realization in the quarter was around 3%, expect about 2.5% in the second half and full year approaching 3%. On chemicals they said chemicals are under 15% of sales, mostly specialty chemicals, EU results improved in Q2 but they remain cautious.
"So Core Industrial would be low single digit organically." — Shawn Vadala (CFO)
Lab momentum and margin outlook
Q (Joshua Waldman): Analyst asked what drove the Lab reacceleration and whether mid-single-digit growth will stick, and asked for an update on margin performance versus plan.
A: Management said Lab momentum comes from strong go-to-market teams and innovation, with process analytics and analytical instruments performing well and pipettes returning to growth; Lab is well positioned with LabX and broadly the company expects Lab mid-single-digit growth. On margins they said tariff refunds are excluded from adjusted results; Q2 operating margin was up 100 basis points excluding currency, and full-year operating margin excluding currency is likely up about 60, 70 basis points (reported up modestly).
"I would say, yes, we're actually quite pleased with the momentum we have in Lab moving forward." — Patrick Kaltenbach (CEO)
FX, M&A contribution and Q4 exit rate
Q (Vijay Kumar): Analyst asked the FX and acquisition revenue contribution in the quarter, and why the implied Q4 exit rate steps up versus Q3.
A: Management said acquisition contribution was about 1.5% and reported FX implied about 1% (north of 1%). Regarding the higher implied Q4 exit rate they said Q3 has a much more challenging comparison to the prior year and that sequentials are in line with historical patterns, and they feel good about momentum entering the back half.
"I think a lot of that also has to do with the fact that Q3 has a much more challenging comparison to the prior year." — Shawn Vadala (CFO)
Biopharma and reshoring momentum
Q (Michael Ryskin): Analyst asked how big the step-up in biopharma/bioprocessing was, where momentum is strongest, and whether it is early or has crested; also asked how conservative the guide is given geopolitical risks.
A: Management said bioprocessing is meaningful (low double digit of total sales) and Pro and Industrial Automation showed strong growth, especially in the Americas, with some RFQs tied to reshoring but it is still early innings. They expect momentum to pick up in the second half and into 2027 and 2028; they also said they see encouraging strength in analytical instruments and lab balances. Regarding the guide and geopolitical risk, management said momentum is strong, backlog is short cycle (about 1.5 months), customers now seem to have finalized budgets, and they feel good about the second half while continuing to monitor risks.
"I think this momentum will continue to pick up in the second half and also as we go into 2027." — Patrick Kaltenbach (CEO)
EPS raise and Core Industrial demand
Q (Jack Meehan): Analyst asked whether the EPS raise mainly reflects Q2 outperformance or improving conditions, and asked about Core Industrial correlation to macro like PMIs.
A: Management said they were pleased with Q2 and raised full-year guidance, but the second-half model includes some conservatism to derisk geopolitical concerns even though underlying momentum looks good. On Core Industrial they said automation and digitalization categories are growing well, they are less correlated to PMIs than 10 years ago, and pockets of project timing (e.g., transportation and logistics) can cause lumpiness.
"It looks like maybe there's a little bit of conservatism or moderation slightly." — Shawn Vadala (CFO)
Reshoring and Americas performance
Q (Casey Woodring): Analyst asked whether reshoring conversations have picked up and if orders might arrive before year-end; also asked how the Americas trended by segment and which areas are lagging or improving.
A: Management said they see RFQs related to reshoring as customers expand U.S. manufacturing, but large factory investments are early innings and momentum should carry into 2027 and 2028. For the Americas they guided Q3 low to mid-single digit (lapping strong prior comps) and said academia and biotech are improving, pipetting returned to growth, bioprocessing and process analytics are strong, and retail causes some lumpiness but the underlying business looks positive.
"Yes, we see some activity there with RFQs that are related to reshoring, again, as customers are expanding manufacturing in the United States, that is a good indication that there's more business to come." — Patrick Kaltenbach (CEO)
Pricing long-term and hot segments
Q (Kallum Titchmarsh): Analyst asked where the company has been more aggressive on price by segment and geography, whether long-term price could exceed 2%, and about readiness in hot areas like bioprocess and semis.
A: Management said they expect to discuss more at Analyst Day but do not expect to guide higher than 2% long-term on price; price realization varies by geography with higher price actions where inflation was higher (for example the U.S. due to prior tariffs). On hot segments they said semiconductor, battery, GLP-1 and others are low single-digit contributors that grow fast, and the company makes strategic, tailored investments to serve these areas.
"I certainly wouldn't expect us to come out with a higher price increase guidance than 2%." — Shawn Vadala (CFO)
Lab drivers and service trends
Q (Elizabeth Koslosky): Analyst asked whether Lab improvement is from pharma investing in automation/AI workflows or just returning certainty, and asked how service trended and outlook.
A: Management said Lab improvement is driven by innovation, automation and digitalization, plus new products (for example a new semi-automatic pipette) and the LabX informatics platform that supports automation and data aggregation. Service grew strongly in the quarter (9%, organic 7%), management said they are investing in service tools such as an AI-supported knowledge base for service engineers, services exceeded $1 billion last year and are expected to grow high single digit for the year (Q3 mid- to high single digit).
"For example, our service engineers have now access to an AI-supported knowledge base where they can basically use all of the internal information that we have regarding earlier service records, about R&D material, application notes, et cetera." — Patrick Kaltenbach (CEO)
Pharmacopeia weighing rules impact
Q (Michael Polark): Analyst asked if the U.S. Pharmacopeia weighing revisions drove demand, what activities it created, and how Mettler is exposed.
A: Management said revisions not only from the U.S. Pharmacopeia but also from Japanese and China Pharmacopeias helped drive incremental growth. They said the company is extremely well positioned with the recently launched portfolio of new Lab balances to help customers comply with the new weighing regulations.
"And we are extremely well positioned with our -- exactly with the recently launched portfolio of new Lab balances to help our customers to support them with complying with these regulations." — Patrick Kaltenbach (CEO)
Emerging markets growth drivers
Q (Dan Leonard): Analyst asked whether emerging markets growth outside China is volume or pricing, and about service attach, long tail, and whether growth maps to manufacturing GDP or has special pockets.
A: Management said emerging markets outside China are growing high single digits with good momentum in India, Latin America and other regions, and reshoring/onshoring and new investments help drive both instrument and service demand. They said connect rates in these regions are not significantly different, services and recurring revenues create additional opportunity, and India is a standout while their direct local sales teams help capture local demand.
"Yes, we are growing high single digits in these emerging markets outside of China." — Patrick Kaltenbach (CEO)