Revenue Growth and Top-Line Performance
Q2 revenue of $4.7 billion, up 2.6% year-over-year (FX-neutral). Management reaffirmed full-year revenue guidance of low single-digit growth and expects H2 growth to be roughly similar to H1.
Becton Dickinson
· BDX
May 7th, 2026
Summary
- Earnings Call Date:
- 2026-05-07
- Change Since:
- -2.90%
- Next Earnings Date:
- 2026-07-30
Earnings Call Sentiment
PositiveThe call emphasized broad-based operational and commercial execution with revenue growth, margin resilience, strong cash generation and an increased full-year adjusted EPS outlook. Several high-growth platforms delivered double-digit growth and BD Excellence drove meaningful productivity and quicker product launches. Notable near-term headwinds include Alaris' upgrade-cycle comparisons, weaker vaccine demand, China market dynamics, tariff-related margin pressure, a $450 million noncash impairment, and a temporary ship hold following an FDA warning letter. Overall, positive operational momentum and capital returns outweighed the focused and disclosed challenges, giving confidence in the New BD strategy while acknowledging short-term risks.
Company Guidance
BD reaffirmed full-year revenue guidance of low single-digit growth and said second-half revenue should be roughly similar to the first half, with currency expected to be a ~120 basis‑point tailwind; it raised full‑year adjusted EPS to $12.52–$12.72 and expects adjusted operating margin of ~25% (inclusive of tariffs) and an adjusted effective tax rate of 16–17%. In Q2 BD reported $4.7B revenue (+2.6% YoY), adjusted EPS $2.90 (+3.9%), adjusted gross margin 54.7% (down 90 bps, including +70 bps from productivity/mix and -160 bps from tariffs) and adjusted operating margin 24.2% (down 110 bps); adjusted EPS excludes ≈$450M of noncash impairment charges. Year‑to‑date free cash flow was $1.1B, BD returned ~$2.3B to shareholders in the quarter (including $2.0B repurchases and $0.3B dividends), retired $2.1B of debt, ended the quarter at ~2.9x net leverage (targeting 2.5x long‑term), and cited BD Excellence productivity of ~8% in Q2 plus progress on a $200M cost‑out program with $150M run rate already delivered.
Adjusted EPS and Margin Outperformance
Adjusted EPS of $2.90 in Q2, up 3.9% year-over-year and ahead of expectations. Adjusted operating margin of 24.2% (ahead of company expectations) and adjusted gross margin of 54.7%.
Raised Full-Year Adjusted EPS Guidance
Updated FY26 adjusted EPS guidance increased to $12.52–$12.72, reflecting stronger-than-expected H1 performance and improved visibility into the remainder of the year.
Broad-Based Portfolio Momentum
More than 90% of the portfolio delivered mid-single-digit growth; multiple growth platforms delivered double-digit growth in the quarter including biologic drug delivery, Advanced Patient Monitoring (APM), PureWick and Advanced Tissue Regeneration.
Segment-Level Strengths
Connected Care grew 3.3% with APM up ~12% driven by U.S. consumables; Interventional grew 5.3%; Medical Essentials grew 1.7%; MM&S infusion sets saw low double-digit growth; BioPharma Systems mix shifting toward biologics (see next highlight).
Biologics Momentum
Biologics now represent ~55% of BioPharma Systems revenue (up from ~50% previously). Secured several significant long-term wins including two next-generation GLP-1 programs with global pharma companies.
Operational Productivity and BD Excellence
BD Excellence delivered ~8% productivity in Q2 and service levels >90%. Program has driven ~2,000 Kaizens annually, reduced time-to-launch by over 10 months on average across five development programs year-to-date, and is a core driver of margin and service improvement.
Cash Generation and Capital Return
Year-to-date free cash flow of $1.1 billion (significant increase vs. prior year). Returned ~$2.3 billion to shareholders in the quarter (including $2.0 billion in share repurchases and $0.3 billion of dividends) and retired $2.1 billion of debt; net leverage ~2.9x with a long-term target of 2.5x.
Cost-Out Progress and Manufacturing Rationalization
On a $200 million cost-out program with $150 million run rate already achieved; manufacturing footprint reduced to roughly 50 sites with further actions underway to simplify the network and drive margin expansion.
Commercial Traction and Product Launches
Notable commercial wins and launches: Alaris share gains (~50 bps in Q2, ~150 bps YTD), strong HemoSphere Alta adoption and Smart Recovery consumables demand (~20% increase), Pyxis Pro early traction (75% of wins are competitive conversions), and product launches including EnCor EnCompass Biopsy System, Revello Vascular Covered Stent (EU), HemoSphere Stream Module expansion, Surgiphor Pulse and Avitene Flowable.
Operator
Hello, and welcome to BD's Second Fiscal Quarter 2026 Earnings Call. At the request of BD, today's call is being recorded and will be available for replay on BD's Investor Relations website, investors.bd.com or by phone at (800) 688-9445 for domestic calls and area code +1-402-220-1371 for international calls. [Operator Instructions] I will now turn the call over to Shawn Bevec, Senior Vice President, Investor Relations. Please go ahead.
Shawn Bevec
Good morning, and welcome to BD's earnings call. I'm Shawn Bevec, Senior Vice President of Investor Relations. Thank you for joining us. This call is being made available via audio webcast at bd.com. Earlier this morning, BD released its results for the second quarter of fiscal 2026. The press release and presentation can be accessed on the IR website at investors.bd.com. Leading today's call are Tom Polen, BD's Chairman, Chief Executive Officer and President; and Vitor Roque, Executive Vice President and Chief Financial Officer. Before we get started, I want to remind you that we will be making forward-looking statements.
You can read the disclaimer in our earnings release and the disclosures in our SEC filings on our Investor Relations website. Unless otherwise specified, all comparisons will be made on a year-on-year basis versus the relevant fiscal period. Revenue percentage changes are on an FX-neutral basis unless otherwise noted. Also, references to adjusted EPS refer to adjusted diluted EPS. The financials discussed here and included in the earnings release and 10-Q are presented on a continuing operations basis. Prior periods have ...
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