Waters Q4 Earnings Surpass Estimates, Revenues Increase Y/Y

Waters Corporation WAT reported fourth-quarter 2025 non-GAAP earnings of $4.53 per share, which beat the Zacks Consensus Estimate by 0.67% and increased 10.5% year over year. 

Net sales of $932.4 million topped the Zacks Consensus Estimate by 0.55%. The figure increased by 7% on a reported basis and 6% on a constant currency (cc) basis year over year.

Waters’ Q4 Top Line in Detail

WAT operates under two organized segments: Waters and TA. The Waters segment generated sales worth $823.9 million, up 8% on a reported basis and 7% on a cc basis, year over year. Sales in the TA segment were $108.4 million, flat year over year on both a reported and cc basis.

Products & Services: The division comprises three segments: Instruments, Services and Chemistry. Instrument sales were $432.9 million, up 3% year over year on a reported and cc basis. Services sales were $329.1 million, which increased 9% year over year on a reported basis and 8% at cc. Chemistry sales were $170.3 million, which grew 13% on a reported basis and 12% at cc, year over year. The Services and Chemistry segments jointly generated recurring revenues of $499.5 million, up 10% year over year on a reported basis and 9% at cc.

Waters serves three end markets: Pharmaceutical, Industrial, and Governmental & Academic. The Pharmaceutical market generated sales of $540.6 million, which increased 8% on a year-over-year basis, reportedly, and 7% at cc. Industrial sales were $284.5 million, up 8% year over year on a reported and cc basis. Government & Academic sales decreased 2% reportedly and 3% at cc to $107.3 million.

Waters’ operating regions include Asia, the Americas and Europe. Asia generated sales of $283.9 million, up 4% and 11% on a reported and cc basis, respectively. Americas sales were $332.4 million, which increased 4% in both reported and cc terms. Europe generated sales of $315.9 million, which increased 13% reportedly and 4% at cc.

WAT’s Q4 Operating Details

In the fourth quarter of 2025, non-GAAP selling and administrative expenses were $191 million, up 13.3% year over year. As a percentage of net sales, the figure increased 120 basis points (bps) on a year-over-year basis.

Research and development expenses of $50.1 million, up 8.3% year over year. As a percentage of net sales, the figure expanded 10 bps year over year.

The adjusted operating margin was 35.2%, which contracted 20 bps year over year.

Waters Balance Sheet & Cash Flow

As of Dec. 31, 2025, cash and cash equivalents were $587.8 million, up from $459.1 million as of Sept. 27.

Waters generated cash from operations of $164.5 million in the reported quarter. The company reported a free cash flow of $125.2 million.

WAT Offers Q126 and FY26 Guidance

Waters expects first-quarter sales growth between 7% and 9% on a cc basis. Sales on an organic reported basis and reported basis are expected to be in the range of $718-$731 million and $1.19 billion to $1.21 billion, respectively.

Waters expects first-quarter 2026 non-GAAP earnings to be in the range of $2.25-$2.35 per share. This indicates year-over-year growth of approximately 0.0% to 4.4%.

For full-year 2026, Waters expects cc sales growth between 5.5% and 7%. Sales on an organic reported basis and reported basis are expected to be in the range of $3.35-$3.40 billion and $6.40 billion to $6.45 billion, respectively.

Waters expects non-GAAP earnings in the $14.30 to $14.50 per share range. This reflects year-over-year growth of approximately 8.9% to 10.4%.

Zacks Rank & Other Stocks to Consider

Currently, Waters carries a Zacks Rank #2 (Buy).

AngioDynamics ANGO, Alkermes ALKS and Ironwood Pharmaceuticals IRWD are some other better-ranked stocks that investors can consider in the broader Zacks Medical sector.

AngioDynamics shares have increased 4.8% in the trailing 12-month period. The company is scheduled to release third-quarter 2026 results on April 1. ANGO sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Alkermes shares have dropped 7.5% in the trailing 12-month period. ALKS is scheduled to release fourth-quarter 2025 results on Feb. 25. Alkermes sports a Zacks Rank #1.  
 
Ironwood Pharmaceuticals has returned 129.4% in the trailing 12-month period. IRWD is set to report its fourth-quarter 2025 results on Feb. 26. The company currently sports a Zacks Rank #1.

 

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