01—Abstract
Summary
Summary of the 10-Q filed May 7, 2026. Cited figures are marked; the original filing is the authoritative source.
Becton Dickinson & Co. (BDX) reported a net loss of $311 milliona for the third quarter of fiscal year 2026, a significant shift from the net income of $308 million in the prior-year period.
This was largely driven by a $274 millionb loss from discontinued operations, primarily due to the February 9, 2026, spin-off of its former Biosciences and Diagnostic Solutions business as part of a Reverse Morris Trust transaction with Waters Corporation. Revenues for the quarter increased by 5.2% to $4.714 billion, demonstrating underlying business growth. However, the company faced increased operating costs, including integration, restructuring, and transaction expenses, which impacted profitability.
The company also announced a substantial $2 billionc share repurchase program funded by proceeds from the spin-off, alongside continued dividend payments to shareholders. Management is focused on its "Excellence Unleashed" strategy to drive future growth and operational efficiency.
02—Key points
Key Highlights
- Net loss of $311 million for the quarter, compared to a net income of $308 million in the prior year, heavily influenced by discontinued operations ($274 million loss).
- Total revenues increased by 5.2% to $4.714 billion, indicating top-line growth across continuing operations.
- Significant integration, restructuring, and transaction expenses totaling $533 million impacted the quarter's results.
- Completed a $2 billion accelerated share repurchase (ASR) program funded by proceeds from the spin-off of the Biosciences and Diagnostic Solutions business.
- Dividends per common share increased slightly to $1.05 for the quarter, continuing to return value to shareholders.
- Operating income from continuing operations declined significantly to $93 million from $383 million in the prior-year period, reflecting increased costs and the impact of discontinued operations.
- The company ended the quarter with $1.018 billion in cash and equivalents and short-term investments, providing a solid liquidity position.
03—One dollar
Follow one dollar
For each $1.00 of revenue in Q2 FY2026, Becton Dickinson & Co lost $0.07.
- Revenue$4.71B100.0%
- Cost of revenue−$2.56B54.3%
- Gross profit$2.15B45.7%
- Operating costs−$2.06B43.7%
- Operating income$93.0M2.0%
- Interest, other & tax−$404.0M8.6%
- Net income−$311.0M6.6%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2026filed May 7, 2026Financial Statements
Q2 FY2026 against Q2 FY2025
| Line item | Q2 FY2026Q2 FY2025 | Change |
|---|---|---|
| Revenue | $4.71B$4.48B | +5.2% |
| Cost of Revenue | $2.56B$2.62B | −2.3% |
| Gross Profit | $2.15B$1.86B | +15.7% |
| R&D Expenses | $249.00M$232.00M | +7.3% |
| SG&A Expenses | $1.21B$1.12B | +8.6% |
| Operating Expenses | $4.62B$4.10B | +12.8% |
| Operating Income | $93.00M$383.00M | −75.7% |
| Net Income | -$311.00M$308.00M | −201.0% |
| EPS (Basic) | $-1.11$1.07 | −203.7% |
| EPS (Diluted) | $-1.11$1.07 | −203.7% |
| Shares Outstanding (Basic) | 280.64M287.29M | −2.3% |
| Shares Outstanding (Diluted) | 280.64M287.74M | −2.5% |
05—Questions
Frequently Asked Questions
What caused the significant net loss this quarter?
The net loss of $311 million was primarily due to a $274 million loss from discontinued operations. This loss is a result of the spin-off of the company's former Biosciences and Diagnostic Solutions business on February 9, 2026, as part of a transaction with Waters Corporation. While revenues from continuing operations grew, higher operating costs, including integration, restructuring, and transaction expenses, also contributed to the net loss.
How did the spin-off of the Biosciences and Diagnostic Solutions business affect the company's financial position?
The spin-off resulted in the classification of the former business's results as discontinued operations. The company received a $4 billion cash distribution from the spin-off entity, which was used for significant debt repayments and share repurchases. Assets and liabilities related to the spun-off business are no longer on the consolidated balance sheet as of March 31, 2026, but were present as of September 30, 2025.
What is the outlook for BDX given the recent restructuring and financial results?
BDX is implementing its 'Excellence Unleashed' strategy, focusing on competing, innovating, and delivering. Despite the current quarter's net loss driven by one-time spin-off related costs and discontinued operations, the company demonstrated revenue growth in its continuing businesses. Management is prioritizing operational excellence, quality, and cash flow generation. Future performance will depend on the successful execution of this strategy and navigating ongoing macroeconomic and regulatory challenges.
Are there any significant legal or regulatory issues that investors should be aware of?
Yes, BDX is involved in several legal proceedings, including product liability claims (e.g., hernia repair devices, pelvic mesh, implantable ports) and government investigations (e.g., False Claims Act). The company has accrued approximately $1.7 billion for product liability and other legal matters. Additionally, there are ongoing FDA Warning Letters related to manufacturing quality at certain facilities, which could impact operations and potential liabilities. The company is actively defending itself in these matters, but significant outcomes could still materially affect financial results.
06—Continue