Finally, our remarks today will include references to non-GAAP financials including net income and diluted earnings per share, which are financial measures that are not defined under generally accepted accounting principles. In addition to excluding certain atypical and non-recurring items, our non-GAAP financial measures exclude changes in the equity value of our stake in Sartorius AG. In order to provide investors with a better understanding of Bio-Rad underlying operational performance, investors should review the reconciliation of these non-GAAP measures to the comparable GAAP results contained in our earnings release. We have also posted a supplemental earnings presentation in the Investor Relations section of our website for your reference.
Both revenue and operating margin exceeded consensus expectations, underscoring the strength of our portfolio and the discipline of our teams in a challenging and rapidly evolving macroeconomic environment. Our clinical diagnostics business remained stable while our life science segment benefited from the strength in our process chromatography portfolio. Product mix and a continued focus on cost control and discretionary spending helped drive an outperformance in operating margin for the quarter. This resilience highlights the enduring demand for our differentiated assays and reagents, including droplet digital PCR consumables, which saw high single-digit revenue growth versus 2024.
Synchronized with the closing of the Stilla acquisition, we launched the rebranded QX700 Series ddPCR instruments. Strength outside of China helped offset local reimbursement pressures, resulting in 3.7% growth in our rest of world markets. While we factored headwinds from the recent Diagnosis Related Group or DRG policy changes affecting diagnostic panels into our first quarter guidance, the impact was not significant. Net sales for the second quarter of 2025 were approximately $652 million, which represented a 2.1% increase on a reported basis versus $638 million in Q2 of 2024 on a currency neutral basis.
| Metric | Period | Current guidance |
|---|---|---|
| Total currency-neutral revenue growth | FY2025 | Flat to 1% growth (midpoint ~25 bps higher) (raised) |
| Life science segment growth | FY2025 | Flat to 1% (raised) |
| ddPCR portfolio revenue growth | FY2025 | Mid single digit (reflecting Stilla) (raised) |
| Process chromatography growth | FY2025 | Low double digit (raised) |
| Diagnostics growth | FY2025 | 0.5%-1.5% (lowered (50 bps at midpoint)) |
| Non-GAAP gross margin | FY2025 | 53.5%-54.5% (raised at low end) |
| Tariff headwind to operating margin | FY2025 | 30-40 bps (reduced) |
| Operating margin | FY2025 | 12%-13% (raised) |
| Free cash flow | FY2025 | $310M-$330M (reaffirmed) |
| Metric | YoY | Note |
|---|---|---|
| Net sales | +2.1% reported (+1% currency neutral) to ~$652M | Primarily driven by process chromatography product sales |
| Life Science segment sales | +4.9% reported (+3.8% currency neutral) to $263M | Increase in process chromatography and food safety product sales |
| Clinical Diagnostics segment sales | Flat reported (-0.7% currency neutral) at ~$389M | Lower diabetes testing reimbursement in China, partially offset by quality control and immunology demand |
| Non-GAAP gross margin | 53.7% vs 56.4% | Higher material costs and reduced fixed manufacturing absorption from lower instrument demand |
| Non-GAAP operating margin | 13.6% vs 16.7% | Lower gross margin |
| Non-GAAP net income | $71M ($2.61 EPS) | Excludes Sartorius equity value change |
| Free cash flow | $71M vs $55M | Stronger cash generation |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Academic/government research funding | More paralysis in Q1 | Stabilization, particularly in consumables; stable through the quarter | Improving |
| Process chromatography | High single digit outlook | Low double digit, normalized order patterns; ~20% of quarter's sales were pulled forward | Improving |
| China diagnostics | Diabetes reimbursement and DRG headwinds contemplated in Q1 guidance | Still soft; no new VBP impact, no significant new reimbursement changes | Stable/soft |
| Tariffs | Up to 130 bps potential headwind | Reduced to 30-40 bps after easing China tensions and tariff delays | Improving |
| ddPCR portfolio | QX Continuum in development | Continuum complete, Stilla closed, QX700 launched; positive early feedback | Improving |