Danaher (DHR) 23 Jul 242024 Q2 Earnings call transcript

Good morning. My name is Todd, and I will be your conference facilitator this morning. At this time, I would like to welcome everyone to Danaher Corporation's Second Quarter 2024 Earnings Results Conference Call. [Operator Instructions] After the speaker's remarks, there will be a question-and-answer session. [Operator Instructions] I will now turn the call over to Mr. of President Vice Bedford, Investor Relations. John Mr. may you begin your conference. Bedford,

Chief and Good Rainer us and Financial Matt Officer. thanks and on Vice everyone, our Blair, Officer; Executive McGrew, the President are joining Chief today for morning, President and us call. our Executive With

call slide to provided other I'd the by information the heading point Quarterly the SEC our a website, any our call, measures today's and Regulation earnings that to www.danaher.com, supplementing details section the Investors performance the and relating non-GAAP containing required during financial future like anticipated under of release, on are G of out presentation note reconciliations and available all historical Earnings. financial

the heading of under call available our of audio X, later today will and website Events next Investors replay be section remain The this quarterly archived of portion archived the our this also and call XXXX. Presentations will will A until August call. on until be

of regulatory for products certain in and to devices pending the We are to relate or certain describe and During results year-over-year the financial impacted that and increases or decreases and to materials metrics that certain factors these more submitted certain presentation, references noted, period-to-period describe which and in second additional in operations available to XXXX The quarter company-specific the describe year-over-year all markets. materials performance. also references all applications impacted relate remarks year-over-year. we metrics Unless supplemental from may otherwise will approvals performance. continuing supplemental significant factors are financial only of have

are do will forward-looking that occur to today. that set laws, statements forward-looking required of statements, update a forth forward-looking those of differ or will we we might and obligation regarding statements are future. statements of make events the risks materially number in by subject not may any we make and statements filings, forward-looking During SEC as meaning we securities from speak date to developments including they within including These assume the forward-looking as law. or our statements only the and uncertainties, believe anticipate any except These that actual or results in any federal the the made, call,

like the over With that, I'd call Rainer. turn to to

and you Thank you, everyone. the us today. John, really morning, good We appreciate call joining on

sustained well executed revenue, the team and bioprocessing earnings were quarter, again We business our which we in performance during better-than-expected gained Cepheid, the in flow. with Our market the share quarter. molecular and at delivering positive second particularly believe pleased testing cash momentum with strong this

conditions largely Europe across single we were In weak portfolio, quarter. digits activity bioprocessing this the Now continue continued underlying our liquidity. as encouraged anticipated. levels orders and were bioprocessing increase sequentially to the but market manage to remain improve, business, in China, sequentially were demand we see In conditions and high and as to U.S. customers stable

in healthy constrained, Life capital across our we demand remain In equipment businesses. globally while Diagnostics, was investments revenue relatively And stable. saw recurring Sciences,

is Danaher well for creation. move we positioned transitional believe long-term through we this sustainable As period, value

profile. with our supports attractive growth Business Danaher single-digit a core long-term strong flow expectations coupled of high power end revenue in positioning margin durable, the the revenue differentiated Our and recurring models System cash and markets, of business high with

billion decline by across strength digits, low second diagnostics, our biotechnology in a core developed life that, revenues including High-growth markets with single were offset digits second closer We sciences. were So results. and single in teens markets the declined declined X.X%. declines down let's quarter, and with quarter high China. a high in in core $X.X XXXX take Sales Geographically, revenue look at

$X.X as We of for diluted year-to-date profit adjusted XX.X% volume. favorable the free per free cash our of ratio margin And impact to essentially lower net quarter net than initiatives offset basis XXX%. profit year-over-year. cash Adjusted operating points more were flow XX.X%. and margin was flow savings cost XX billion a the of second flat gross in year-to-date, was Our $X.XX income share common $X.X of billion conversion in earnings resulting of generated the quarter up

quarter additionally, July, Now through XX second the we and repurchased approximately into million shares.

an our given return long-term earnings cash we organic repurchases capital outlook. growth, our remains deployment, M&A these While for strength flow attractive of bias believe the will and provide

the look in and we're closer what you across seeing give Now color our at let's on end today. some portfolio take a our results markets

and high In declined our down seeing from for Europe single our Many worked majority growth. X% bioprocessing digits U.S. in excess revenue returning and promising bioprocessing future with Core their which therapeutics customers patterns. these larger have business momentum are also the strong Discovery segment down inventories as of through to revenue we customers the ordering pipeline, in their the Medical are quarter the late-stage declines believe business, first our is and business and our the in Biotechnology digits. of normal for mid-single moderated

cell Our in particularly prioritize and customers for to an emerging effort therapies continue to gene projects, biotech manage liquidity.

are improvement is funding environment, overall encouraged the the a by positive these leading for which However, in customers. indicator we

There high year, business we revenue on core the to So also our expect year. in decline digits year low for assumption revenue exit to first bioprocessing the single-digit our better we XXXX. based single change of or as full no of of saw trends is continue through the a rate growth core half the we a bioprocessing the

track biologic again at on digit full set XXXX the or year the is better new a record. the market first demand to grow healthy full medicines of in single doubled remains Biologics this year, as genomic the for production. approvals compared the to of number by and of the biologic very half of and rate half XXXX on in high clearly both first evidenced also remains for year FDA track to for another Underlying treatments, Notably, and medicines increasing XXXX. development number

we and robust substantial given So very in approvals bioprocessing production volumes, growth rate the remain come. to to many and years the sustained for in expect increase

antibody these as revenues, therapeutics. To portfolio filtration We comprehensive life-changing expanded innovation support launch to make comprises Cytiva to its bioprocessing pursue with our continue Prime. majority investments of monoclonal production, our substantial the the support which of in Supor they customers

manufacturing emerging helping to filter We're fully therapy challenges CAR-T Cytiva high specifically Prime will Now year our manufacturing. productivity high patient whose automated make Addressing compared constraints XX% up and can per capacity associated wider In are and therapy support with challenges process introduced cell of innovative costly them therapeutics. the to and industry and costs address concentration and customers' access cost increase also standard, loads improve these critical the with solutions designed formulations adoption premature these Cepheid particle associated key filters to address by manufacturing product manufacturing Cepheid is which May, biologic throughput. facilitate drug help The prone drugs platform's to important complex platform, developing cell increasing for modalities. key reducing losses. blockage

activity decreased Now quarter we high Life X.X%. first businesses segment. sciences our Core second we're markets quarter. particularly life and recently critical our performed Academic in with and what by in weak. revenue driven improving comparatively weaker as in which quoting consistent by revenue turning provide our Core solutions, measures. for announced the the applied advanced seeing pharma by In to were trends better, needed expected, sales largely declined single remained our stimulus demand sequentially funnels with Sciences capabilities the instrument saw China, digits biotech and markets customers. Global collectively

stages they the as decisions we early programs XXXX as until this of implementation. customers to many funding. purchasing meantime, await and convert don't are these are However, anticipate in to In the orders delaying

month, triple the The meeting, in to the ultra-high mass plus X,XXX quad for faster up to their of acquisition mass spectrometer. ability American sample quantitation last XXXX speeds SCIEX pairs the spectrometry at X,XXX-plus as the of Mass the quantitative of and rents. sensitivity Society with Now the release Spectrometry highest twice many sensitivity maintain market the reinforced with leadership

In declined This consumables where sample more makes need next-generation our impact of business, business. plasma and genomics in core writing growth with mid-single as the solutions to gene across than particularly challenging was in customers new regulations. for more such single-digit to the High samples sequencing our and complex editing project X,XXX-plus test timing precision analysis, offset suited PFAS the high diverse in meet types well declines applications digits revenue quarter. in by

last development their rapid During expanding at DNA the IDT activities. facility to support the Corville, XX which quarter, and the related for needed campus, to synthesis within the drug months global enables synthesis. rapidly expansion provides market facility gene manufacture new and as the team Iowa is such second manufacturing a opened the new IDT offerings capacity This differentiated

Now revenue moving increased Core X%. over to Diagnostics our segment.

Biosystems Leica recently strength its XXX(k) pathology led Aperio Digital delivered mid-single-digit with collectively Our GTXXX high at clinical digits core slide diagnostics by received up single-digit by in growth Radiometer. growth which clearance. scanner, revenue Pathology notable mid-single digital driven Diagnostics FDA businesses was

Beckman Diagnostics up was developed strength markets. with low single balanced across digits high-growth both and Coulter

Beckman This clinicians of condition diagnose allows Now failure. of accurately analyzer. important testing the to XXXX of received cardiac severity expansion its suspected May, Access acute having and patients the FDA clearance DXI immunoassay heart NT-proBNP XXX(k) on in and menu of Beckman's quickly assess

XXXX this Now and of the increasingly latest just platform's more clearance to capability the DXI diagnostics. clinically is confirmation relevant develop sensitive

our driven higher expectation respiratory of volumes a exceeded of both Cepheid's revenue mix our approximately COVID-XX, RSV. of $XXX and in and A test X-in-X for Flu B Diagnostics, Molecular million favorable In the million, quarter $XXX by and

year revenue continue for $X.X billion of full expect XXXX. we So the to approximately respiratory

quarter. mid-teens believe core sexual growth XX% to Now as portfolio, share including I in than during more the reagent helped growth adoption menu and in mentioned utilization assays. earlier, Cepheid virology health continued system gain and team our drive the nonrespiratory we market increasing

as instruments closer care in patients. network nearly adding their XX,XXX sites networks customers health many to are integrated delivery at installed to and expand system continued also new We base existing systems further and our out

process June, Cepheid the C, which hepatitis molecular Hepatitis treatment C same the during can In Cepheid's based been diagnosis requiring C test, delays. for hepatitis the test. granted the and traditionally has tested multistep point-of-care its appointments RNA treatment With marketing receive be leading a care is health and visit. test first patients authorization follow-up FDA for

is a growth accurate, Cepheid. of is bringing treatment easy-to-use driving outcomes long-term great patients at and closer example how testing this improving So molecular to

sustainability milestones building that like we recently protecting report team, XXXX our of move our the our best pillars expectations sustainability of innovating I'd remainder with and X which to several products before and program, the starting released across details Now improve lives important environment. highlight for planet the the our year, to on our

Notably, greenhouse line targets XXXX. committed with Initiative, reaching to the in emissions we net chain gas X reduction Science-Based including emission by value Target setting have science-based

a make more you and on learn to I of the the report around depth positive to So work the impact commitment to about and holistic sustainability through us. encourage world the scope we're all important to read Danaher's doing

now ahead In at briefly So third range. decline and expectations look in for single-digit low year core the third we quarter XXXX. revenue the percent let's the full to the expect quarter,

we expect third Additionally, profit adjusted the of approximately XX%. quarter margin operating

XXXX, For year our the previous guidance. there no full change is to

low we the full margin and XX%. adjusted As in core a approximately single-digit decline anticipate percent of a range profit reminder, revenue operating a year

So in continued momentum results to business. wrap we're our second encouraged up, and better-than-expected quarter the with our are bioprocessing pleased by

our a Our current also strong breakthrough our have long-term and navigating innovation work And reinforcing commitment team while customers' life-changing advantage. the and innovating that is is support performance the to environment to testament Danaher tremendous with competitive delivering Business done executing a our System. to today their they job

ahead the over portfolio conviction our our stronger long-term focused and years positioned sciences and created share life for repurchases in higher cash reflect expanded transformation leader several for And a recent margins our in growth, a last diagnostic has future Danaher. The bright flow.

sustainable, value. unique the a a combination our differentiation to ahead, team, create strength and foundation leading of financial provides shareholder incredibly the strong us looking So portfolio and profile our talented of with long-term

with I'll John. back turn the that, to call And

Rainer. Thanks, We're comments. our for concludes . now questions. That formal ready

Our questions. Floor is open Meehan now with for Instructions] Research. will question Jack first [Operator Nephron come from

morning. on bioprocessing. And I you. appreciate color follow-ups. the Good Two all Thank

conclusion some destock is is on Can see giving on remain that side, to what's a the the depressed you here? when capital this just elaborate will there? the drawing to equipment consumables. And you long then on on First . improvement you how might confidence thoughts start

here exceptions, side, Jack, very to the ordering that with measures the normal destocking clear few on customers to through during pretty seen So in place with stay put consumables very, we really to that back took visibility the to patterns close our order inventories to and that were in a we active to period, And keep monitor patterns. basis. here ensure measures our we we And feel really we're mind, very normal that, customers actively normalized. in close addition customer-by-customer on we've

took chain sit levels to that we paid we a dysfunction our stock recall to had their terms know you'll decisions the demand we true in that And we And where in we and off think that signal. that's ensure out supply on the consumables. here, took of ensure customers

some Now growth played a different being picture. order being equipment and at We're quarter larger the out here the with of slightly in positive equipment that there digits single well our and is consumables. good customers, activity and high sequential for second both seeing as

And larger customers constrained. customers a smaller a have level, the so remain those do activity higher really more little probably bit whereas

Awesome. piece together the to then we're just here. And trying mosaic

orders bioprocessing high your So increased single digits.

peers your declined sequentially. of One

right in weigh in the what plausible quarter explanations there's if what's diverged. lot a noise? the think turned I of the you think was why just signal, is curious . could being results you the I on for around

from product or geography customer type. everyone positioning, even perspective, Jack, has competitive it's category Well, slightly different a or by whether

we're Now bit look and both if the at concentrated. of in upstream portfolio, more perhaps broadest probably some us, are our you deepest terms downstream, a others little and the while

is various read across. really given about is and be here line the up we the again, the have expected, always this perfect recovering hard that, great it's So industry players and But going as to confident good it's a a in to business. the future. we're to news that

JPMorgan. Rachel Olson Our Vatnsdal next question from with

So on another bioprocessing. X here just

orders XQ growing XQ seen walk X sequential just on quarters sequentially. of the on row few what's contemplated guidance, last You've progression So quarters a you the us in through guide? in a can

orders, is walk this XQ So versus seasonality we expect seasonality XQ on book on just much in should conservatism down into there some also how us the there? in well? of through then for on bioprocessing step to the is as And impact order also

for bioprocessing, in about that's particular, think QX. I should No, respiratory probably bioprocessing talk Yes. in and

kind we've kind of think improvement we and digits, of which teens to we continued single saw of digits QX, you versus think and what sort is, QX, We in digits is of to going down about if here low high QX. in kind that So bioprocessing again, revenue, low down were got be QX single in high single goes a in QX.

China just said, of we're well. as a Rainer comps think largely sort like the Given I little side, the through on consumables destocking bit easier in

outside lower But things little. drivers sort big that think of about think when We've the probably respiratory in So of you you and in just issues X talked bioprocessing, have biotechnology, even as about totality, well. in a guide to of think sort helps if like got the X of I volume QX about you X or about.

biotechnology and guide. revenue That down digits of again of was for the QX mid-single prior from down the step So sort a always in a pandemic that we seasonally. putting between business, prior were pandemic, perspective. the the about sort had and we're QX our in to case to here sequentially We

that the guide assumed we what of that down that kind sort have in we we step normally that's seen. so of And would have

that normal sort as believe order normal we at of we're seasonality going back a we're that to the fact have well. patterns, Given

in So you bioprocessing. for kind of that factor

assuming on $XXX then And the we're million here $XXX revenue million of respiratory, in quarter. versus

margin front add, margin out of as what's That's a of the next well. So of bit here driver where a of the why quarter adjusted little also it the if profile, those given got are reason approximately getting margin the is? X happening question get driver, sort lower big them, might combined sequentially on of I those that's in that of the on kind And XX% kind businesses of to the to reason revenue QX perspective X just margins. maybe the kind big full we're their not to operating the in being you've

noise Great. on on market follow-up XXXX, of at an the where XXXX here, been then my just well. we'll there's And lot standpoint growth industry be as a across and from underlying

digits 'XX also bioprocessing you've lot that thinking in then are some expansion or exiting market? us of business reiterated margins just on underlying Diagnostics that you a bioprocessing to But high in margin total talked durability you well. relation of single in about on and the the incremental how as And about could through at you So walk above. the terms

so, be you So How number? or $X.XX. currently would $X.XX about takes helpful. Street Any are at that EPS is there feeling early

Yes. just We finished second year 'XX. the of quarter

So we still to in got 'XX. we in think of guided January. sort here We've a lot do of always work 'XX left before about

work clearly, left do seeing the is the on the at the processing out Clearly, this perspective. top I plan. here thought line line. improvements in still of Plenty quarter think are playing But least a we is from we in we to top thought. like that

maybe get in through XXXX QX as should then do what revisit kind get quarter there. here so is we we And of fourth the and let's we just

From that, have on talked, the and perspective, last margin bioprocessing the historically as leverage we get QX think margin fall business from year that QX through. being of you this different given we've said, far of XX% over as will quarters call, think talked term, will year. like that think a operating a like and for here kind incremental in perspective, margin XX% But about be to I next a be the I us, typically this as a don't we sort I about of I respiratory, out long talked any

growth any especially be see to of in why bioprocessing. sort reason case, as don't not that we would the I return

here we've we've those been shrinking, been frankly. think levels I as to close

XXs. through, operating and low margin that think to in make we've But time our that normal cost XX% able in this be a time, think adjusted the on business fall should that. is do I So a sure be to we continue I can to the done a structure XX%, lot over

from Melius next Davis Scott will Research. come Our with question

recall I on of What the past. slow? is color, in X buyback. maybe how little Or -- the it statement just M&A is little a that is What's least through at like . more guys you the housekeeping. think bit don't you color [indiscernible] a it this little X as it a slow about should seeing size a thought buyback. --

allocation. Well, a view on that our to it's Scott, not this is on capital important change first, note

So we on be M&A, and towards going maintain continue a active to to strong the front. M&A we're bias

buyback, we so it's and said R&D as evaluate ROIC lens, CapEx using the always, that, having M&A, projects, capital Now same allocation whether forth.

we So options the based these of evaluate all on returns. expected investment

in of generates attractive buyback the a today's value financial returns. specifically relative environment, And

business, we're So know buying a very great X we well.

future strong have its envelope. free a there nearly out M&A this, cash important flow $X that conviction X about We net I leverage while is And maintaining and our billion our about turns. meaningful is this put is

well alternatives. we positioned So with here. various feel

month Rainer. sense, Makes Cytiva, X or we're already maybe in the into a a will XQ it cross Guys, has that already the X in book-to-bill quarter? different crossed said well, way, . since

book-to-bill here make is said, digits. our Well, full low Scott. being year to in as of single we've order X.X, our And bioprocessing guide down

And continue half will confident to have how and be to played that, maintain that certainly that's first we're the here, X.X. has out We the the case.

year As have the here that or or growth. the for know, assumption is we'll you our with as book-to-bills year, better X.X we basically, built but on don't guide guide to we high single-digit exit orders, the

Our Vijay come next Kumar ISI. question will Evercore with from

question the I the the pricing fear change? mix on going be where is here. environment. with some to there it given from environment compared -- great. maybe high about maybe Congrats players, nice a signals talk whether Any pricing different think is could competitive on level a One, the finish I'm

talk market? in what . maybe the about you're So seeing

quarter, up historical for the little And for our XXX likely was will as right to points. of pricing think points a a above all our we there. XXX Look, basis whole, XX for be average XXXX Vijay. up Sure, second basis around Danaher,

the So positioning, leverage price-wise. portfolio we feel good our how and about our in positioned we've here

in in you're getting were good other a quarter. price, the marker X.X% perspective years, think I that pretty couple environment full challenges of to It's type probably where the bioprocessing We from we price was supply inflationary about -- of We some did an last that. to for in but as far more had year. also chain an As we're better Vijay. the here referring price, and price X% that offset probably X%, getting probably

think the bioprocessing, sort a So a comes I price to price we're pressures. some if back to fall significant in will, used much where down. off, seeing points. from of concerns coming XXX those we to of It's which function competitive basis fundamentally, of But you be, perspective, more just don't XXX is

about Okay. up, say activity bigger and any on That's X the quantify between versus that relationship China. pick to been China revenues. to Any there translates would and be that orders a What's when when trend? above activity . helpful. historical Rainer, helpful. framework picture Matt. code code more on you Is way historical trend is averages

China, in seeing activity funnel. we're Well, Sure. in increased is levels what our

has the this in growing projects, in the ready that So is a looking in financing been the and decrease the getting market also will, you but for people seeing stimulus are. naturally stimulus market that's all as funding, we the volumes if players funnel with of and see are see for terms sort shovel-ready our what related conditions velocity we're funnel to what to

us. is have not new is watched we This development. news. expected This So this for

would waiting convert event funding orders for up to receive hold don't would any XXXX. market the into way the that And people expected see view meaningful their more alternatives are to that expect that the in see to We here be. a in what shovel-ready We we projects XXXX funding. funnel as

America. Ryskin from of Our will next question Michael come with Bank

I ask Sciences segment. Life want on to

seeing a think of like I that's digits. a small whole still yet. of a flagged high And lot the improvement instruments sciences still single it part you business, quite as but isn't seems down

called little being a think out bit I weaker. also NGS, You

parts some are of impacted. consumables So

the trends out? to Can a should play . bit the dive and you're instruments in terms seeing So more whole of both just half in Sciences, Just what you order in there? improvement expect market? little as consumables. we end second for a how Life Any

the Well, with quarter. Mike. start Sure, let's

with high we while second as the down the in largely constrained, particularly with came up what more first the better. equipment services quarter quarter, single digits consistent conditions, and held in in, capital market comparatively consumables with expected, saw overall, So China,

Now hold need pharma as applied while weaker applications you particularly up instrumentation that complicated and modestly PFAS, such continue forth. clinical biotech soft well, in markets for stable developed and academic for markets advanced remain but markets, and sequentially, were to so more

And coming are until and comments on back funnels to to to China question, don't Vijay's but to recent build driving measures here, and we activity, expect that the stimulus quoting really my improved orders XXXX. convert to

as their starting decisions So we're await expected, they to funding. customers stimulus as purchasing there see doing the

As second tools second some science the to you we're certainly think and consumables bit, would this that a comps the going half, to about -- the we continue will XXXX. process contribute stabilization. quarter and normalization life to excuse expect me, for through easing But see

is XXXX Okay. it?

XXXX. . Through

The 'XX. end of

at out Okay. core major But Cepheid $XXX of All bit respiratory about diagnostics on bit million. stronger then coming of rest seem the And rest side. and a on right. decline the called still in you in choppy in Q little in diagnostics a the I you Diagnostics sales little specifically, [indiscernible]. the a talked mean

So respiratory business? seeing . what you outside of about could not you're talk

nonrespiratory in both about nonrespiratory if businesses And customer Sure. in Cepheid, with were our you and respiratory We the saw good up. think activity world. growth mid-single-digit around reagents particular,

of XX% menu And the and here virology, quarter. a adoption which was from going to recent XX%. assay Cepheid base, assay, the such utilization; nonrespiratory look we up receive growth you up new forward menu in its we're, launch heard for installed us C, second health, actually course, forward. relatively expansion benefiting And you mid-teens. out, strategy is see in and increasing increasing also So and And then new playing as seeing approvals the journey up sexual hepatitis that

Cepheid, you if at out. look So that plays strategy

grew continue and take nonrespiratory to testing. respiratory We in both share and

there a equipment growth have for into a a bit bit little just quarter. the small negative year-over-year of it a nudged We here down and being with second little that

backlog really, single to the overall remaining of really continues momentum is Diagnostics at digits. a low some this Beckman there grew Beckman for But It's out digits affecting is equipment you that we moderation and innovation And outstanding. The last and had front. quarter, needed revenue recurring great instrument full as lot again commercial We Beckman the a with execution on Now lot here related the is mid-single-digit got challenging Beckman done compare mid-single But Diagnostics growing to got innovation really we've that's a comps. little look bit. a We've a businesses, long-term at placement. with year, the ship pipeline. this the grower.

the full And we've about in of the the expanded product menu talked DxA DxC quarter. our done second proBNP, XXX which NT in has just We the cardiac XXXX; chemistry, with refresh a DxI Access our on XXXX. immunoassay and line automation, the

term. we execution, with businesses our our positioned coupled both So see and diagnostics for long the here, poised very well competitively and

from Our Brennan TD with next question Dan come Cowen. will

Scott's best performers the to question Danaher buyback. of X- and past has back the just stock been the The on Maybe over period. X going XX-year

really you business and guys of DBS. So And deploying on could the time. period M&A attractive on historically buybacks say ROIC during was predicated is stock and model buy don't the really you back arguably, your consistently mentioned, as

bit employing M&A So back? years? what's things maybe And elaborate you the holding the a meaningful could your on over next just M&A today, confidence . what's look environment as capital out we in few for

sort growth going about is made We it. the -- portfolio. how hard positioned the we're Yes, sort where way this like think will, The here. future. of has the it to maybe moves last start. mean, maybe of We through we're capable Dan, to like this have you be I see this business of for really we if is X like think We portfolio the been years -- look, to sort maybe I'll of. what we COVID, fog of the

high It's it are. buyback north what levels. growth of And from some at M&A a I everybody business. We've perspective, if XX% just kind OP return, past. today. And at, we flow single-digit business, better, about the trade then -- a margins, with with return is We I mean would free some conversion some what cash this these our see of good XX% out on gross not of talked when in XXX%. we're the of I we of as the on getting at look multiples still current of a like than

today's in think But just today's the that is buyback environment, in we sense. made And environment. that

a that we bias I bet, believe do Our a we will, of still towards on got a a think that but we today's lot environment. has of got are making kind here business we've is upside. know of still you M&A, And a that if and in bit well disconnect

And just for just one, expectations the QX normal did year back Bioprocess and full maybe Great. of to the maintaining ahead seasonality. could I if go in you're guide. come QX and guide the

a terms So or QX would the -- or things a past, recovery anything you to the you of there talked normalize. that seeing have your pull as in math nice rate forward real is I growth normalize, of I is as about see said in guys think change timing kind any like a as view inventories think of which there nice in you've

the in would QX there's would I that I for the and saw normal nothing say, us that nothing, bioprocessing we is causing say consternation No, about Yes. respiratory. same seasonality. for

seeing QX. about to returning in is are seasonal to bioprocessing, this typically from really normal we decline sequentially a where pattern, QX think I mid-single-digit

we sort And planning that business. change to for for order we've largely seen and going a anything destocking from that on patterns we see the what customer perspective are but revenue back same decline planning the are coming past purposes, mid-single-digit underlying in not purposes, in the sequentially, to because of plan normal, does because we

we it into that So I historical wouldn't pattern, read are sequential assuming than a the and much in revenue other this guidance. normal is too

next Research. Schenkel Doug question come will with from Our Wolfe

Dana. to a bioprocessing, want I First, then pivot in I and [indiscernible] got back to

So It on continued bioprocessing, need is just assumption. years even couple to how you of there. the how of in trends. what in comfortable year just more market, year-over-year market I'm risk you that gone it seems the terms have about end like given exit high with acknowledging improvement digits, meaning expecting any growing this does like last encouraging talked just wondering you're than seem you got single the in improvement continued to the comparisons.

question. that's first So the

term seeing ahead, with dates moving second on recently? That what right [indiscernible] your And mix, your just now. modalities associated quarters. obviously coming could the market you're in be business for forward what's based expectation modalities. the to new new performed contributions near is The accelerator and has on looking over the how then versus In new growth an

on and the better the based on basically headwinds and I'm regarding this finally, broad slowdown related be how to to when? just the is folks seeing get then to stimulus is just where most going clarity stimulus. China, in try where money purchasing wondering you're allocated pending as And

Sure.

our to Let's to from Starting with start recall comments the improvement set talked with out thought. the first did. time equipment. we seen to saw its view as single nearly consumables wanted digits. revenue and and and in quarter bioprocessing improved quarter's and more how I quarter in orders, that you'll with again, half. in down basis both comfortable core our our X points we And X,XXX second a that we've important We teens, high And get in down think from it the here in we level Matt commentary it's high which, this, equipment, And last in see future. on we about that performance played revenue the on row improvement second

single grew an which from sequentially from orders high digits again, is QX, And digit. mid-single the acceleration

and also haven't more do the seen which anomalous exceptions, we've so. those we again, there order destocking and So quarters we and strength the QX, seasonality about here is behind patterns us, X are consider see we'll pre-pandemic largely something for talked guide that last similar because why And or few are there. is our to levels, and that's more very

the and maybe are at about patterns through in large And chain. even provide value to So underlying we historical that historical what those certainly ordering to grow digits, signal entire rates, level. here, note at the customers low the remains to returning which growth again, continue demand important large molecule continues rates, but single to talked because that on-market demand that we saw drugs with high double digits pandemic pre

board. III, strong. At look the if very remain particularly development Phase that's But solid time, at same the we across pipelines

long-term stronger say our had been In fact, and growth that the prior underwrites than it further is to it would we pandemic, expectations.

to of some talked where modalities. tend see biotech Now advanced if and you that's about some these of customers, the you smaller

encouraging. on we to going acid-based promising couple bispecifics overproportionately for other But the of their do been much they impacted Let's now the how see have of in an to focus a improved, perhaps most some just call market, nucleic And right type which that's those of funding players venture them there by what we sake on but they saw spend argument again, that. therapies, contraction play really to capital and on is ADCs. need And capital smaller have that is projects effect the equipment. that that's

if phases, fairly those player With with going exiting order see smaller about portfolio, skew these more impact we is a we tight, in positioned feel therapies particularly good their XXXX another and at and the advanced that's our customers commercialized reason cash and and to broader better. So towards remains portfolio or particular that's our the and book. skewed towards late strength, digits drugs high why single that where

Now on modalities. new to question your coming here back

market, the if much the are their terms those. advanced also small course, They're of fair business, protein part with approval and therapies various but our you overall received, is our player of modalities it's part the smaller a forms. exciting. and of terms that a therapies calibrate, have and of variability, by they're a driven the and of But market. rates of New both in this in going amount in therapies. these in leading business our in small And of mind, Keep advanced reimbursement the are also is for the we associated dynamics business both a part success uptake to a

So trend that the to on. we're advanced at modalities I these beginning going just think very of

Lastly, is The seeing fairly slowdown that really broad-based. China. we're

counting and of to any portfolio, where in our focus, in segment see a you filed. in funnel, and applications disbursement The ready. here at on the that. that that's Life And see Science be lot the are funds but equipment, to academic They're a not happening XXXX. we to more form material we're look is of particular, so research you speak, as dispersed. And As waiting need for that stimulus in the

Jefferies. Peterson last Tycho question will Our come with from

minute day. to in Rainer, back for I of a want instrument kind and go the in SCIEX to just your back background, obviously,

Just over potentially lot the cycle, thinking of years? replacement next get mass that about of questions on think that you the kicking do for How in couple a spec. about we

some there's cycle replacement got COVID debate from that think cycle I of that it's see maybe pulled more be do forward Because during some aspect? going when this you to and muted start the to

to various we the here think going the and there first that's hypothesis following remain of that cycle a innings, about that that in So it's probably additional the And would in here we're replacement of comps going that's we we're And out start the equipment pandemic to cycle XXXX I demand that forward are support in say during again, period going that. market Tycho. take approaching the pulled half. And and would the early experiencing and replaced intact that now. to we're right mid-innings probably funding that normal and we've immediately to normalization the and why why step recovery, probably talked need, And the see intact. lower second replacement lot subsidies sort that is of

you capacity having the think whether U.S. selling the to industry, color. your get about questions capacity then Novo I started of capacity yield I'm appreciate improvements. rid how bioprocess, of getting in We that, get the freeing on about kind just And then think more efficient? on or it's do off of talent [indiscernible] some up the customers how in And Okay. wondering more all some you to

the that what's type things. curious into CDMO on and kind services . And think your view last the playing adding doing of part, side about own kind capacity? of on of equipment the Just you work your maybe just then more side, how

and starting do. that's yields, yields So we improving what with customer

of Our quality accessibility improve these of there's focus life improve the our customers in bioprocessing manufacturing the these help drugs drugs lower improving to of to cost of around opportunity that the to for life-saving ultimately is total world. certainly plenty and yields to and

So inhibitor that's an growth. do. what to don't we as And view we that

On for very value the and contrary, for there believe differentiation well we through see that our creating growth and more more positioned. opportunity we're customers,

demonstrate believe marketplace, here and manufacturers, III commercial we to for the about as in in believe actually large Now production don't in we CDMO, what that is growth. the underwrites capacity We that on and capacity pharma the think orders term, is certainly there equipment needs Phase the increase, capacity or that. increase. that and that in perspective continue long would sufficient we also that moves capacity expect to ultimately that marketplace to there's And for our

have. pharma in company focused to in some they and Now either itself help therapies the of do. transfers the services, the We're as do businesses services we've new their to then it and to talked customers those that complex or We're them provide investing with CDMO scope most tech order ultimately partner. the We relates its excited of our about very about length. at do helping what businesses we on that and

I back to additional Bedford any to John time, for call turn remarks. like or At this would the closing

week joining. for questions. everybody, the . a We'll of around good day. for rest be and you, all Thank day Have

you. Thank Call. Earnings This Quarter Second Conference Results conclude Corporation's does XXXX Danaher

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