Waters forecasts weak first-quarter profit, shares slide

By Gnaneshwar Rajan

Feb 9 (Reuters) – Waters shares fell over 10% on Monday after the lab equipment maker forecast first-quarter profit below Wall Street estimates, with investors also weighing weakness in Becton Dickinson’s unit it acquired last year.

The company, however, forecast full-year profit ahead of estimates, reflecting contributions from its $17.5 billion buyout of Becton Dickinson’s bioscience and diagnostics business, which it bought to broaden its reach in clinical and diagnostic applications.

Separately, Becton posted an 8.3% year-over-year decline in revenue from its life sciences segment, which includes biosciences and diagnostic solutions, for the quarter ended December 31.

“Overall, it looks like the BD revenue came in lighter than expected, so it may be a heavier lift to improve operations in that business… than previously expected,” Morningstar analyst Julie Utterback said.

Becton’s life sciences revenue came in below expectations due to impacts that became apparent during the quarter, Waters CEO Udit Batra said on a call to discuss results.

“In China, demand weakened due to increased focus on reducing consumption and diagnostics testing, while the U.S. government shutdown affected the biosciences business as export approvals got delayed,” Batra said, adding that the cost and revenue synergies are “firmly on track”.

Waters said on Monday it completed its merger with Becton’s biosciences and diagnostic solutions businesses.

Waters forecast first-quarter profit of $2.25 to $2.35 per share, versus analysts’ average estimate of $2.51, according to LSEG data.

It expects 2026 adjusted profit of $14.30 to $14.50 per share, above analysts’ average estimate of $14.32.

Waters expects full-year organic revenue of $3.35 billion to $3.40 billion, compared with estimates of $3.36 billion, and said the acquired Becton unit should add about $3 billion to reported 2026 revenue.

The unit brought in sales of $766 million in the reported quarter, below analysts’ estimate of $1.3 billion.

Waters supplies lab equipment and technology globally, with most revenue coming from biopharma customers that use its tools for research and drug development.

The company reported fourth-quarter adjusted profit of $4.53 per share, topping estimates of $4.51.

(Reporting by Gnaneshwar Rajan in Bengaluru; Editing by Tasim Zahid and Shailesh Kuber)