Why did GAAP EPS grow in Q4 but decline for the full year?

Q4 GAAP EPS rose 24.6% to $1.72, largely because Q4 FY24 carried heavier restructuring, transaction and an SEC-related accrual, and tax expense fell sharply ($17M vs. $114M). For the full year, GAAP EPS declined 0.7% to $5.82 because of higher purchase accounting amortization, restructuring, product and legal charges, and separation costs, partially offset by a lower tax provision.

How strong is the underlying growth after excluding acquisitions and currency?

Growth is moderate. FY25 organic revenue grew 2.9% (3.9% for New BD, which excludes Biosciences and Diagnostic Solutions). Reported growth of 8.2% was boosted by the Advanced Patient Monitoring acquisition (about $977M of inorganic revenue in FY25) and modest FX. Q4 organic growth of 3.9% was similar to the full-year rate.

What does the FY26 guidance imply for investors?

BD guided to adjusted EPS of $14.75–$15.05, about 2.4%–4.5% growth over $14.40, and low single-digit revenue growth. This is a relatively modest outlook, with the guidance excluding amortization, acquisition, restructuring, separation and certain legal charges, so GAAP EPS will be materially lower and less predictable.

What are the main risks flagged in the release?

Key risks include China volume-based procurement pressure (affecting MDS and Pharmaceutical Systems-related areas and Peripheral Intervention), weak vaccine demand, research funding pressure at Biosciences, the timing of the Alaris infusion system's U.S. return to market, tariffs and supply chain costs, litigation and product liability exposure, and execution risk on the Waters transaction, which may not close as planned.

Is BD generating enough cash to support its dividend and buybacks?

In FY25, operating cash flow was $3.43B (down from $3.84B), and after $760M of capital expenditures BD generated roughly $2.67B of free cash flow. That covered $1.2B of dividends and $1.0B of buybacks, though it was insufficient to fund all cash uses alone. Cash fell to $641M, and debt repayments of $1.8B were partially offset by $455M of short-term borrowing, so the company drew down its cash balance.

BDX 8-K: Earnings & Results

01—Abstract

Summary

Summary of the 8-K filed November 6, 2025. Cited figures are marked; the original filing is the authoritative source.

BD (Becton, Dickinson and Company) reported fiscal Q4 2025 (quarter ended September 30, 2025) revenue of $5.89 billion^a, up 8.3% as reported, 7.0% on a foreign-currency-neutral (FXN) basis, and 3.9% organic.

GAAP diluted EPS rose 24.6% to $1.72^b, while adjusted diluted EPS grew 3.9% to $3.96. Growth was led by BD Medical (up 11.2% reported, 4.0% organic), driven by the Advanced Patient Monitoring business acquired from Edwards Lifesciences in September 2024, while BD Interventional grew 8.5% and BD Life Sciences grew 2.1%, with Diagnostic Solutions returning to positive growth. Biosciences declined on research-funding weakness.

For full fiscal 2025, revenue reached $21.84 billion^c (up 8.2% reported, 7.7% adjusted FXN, 2.9% organic). GAAP EPS fell 0.7% to $5.82, reflecting heavy purchase-accounting amortization, product and legal charges, and separation costs tied to the planned Waters combination. Adjusted diluted EPS rose 9.6% to $14.40, and adjusted operating margin expanded 80 basis points to 25.0%, while GAAP operating margin fell 10 basis points to 11.8%.

Free cash flow was supported by $3.43 billion^d of operating cash flow less $760 million of capex, and the company returned $2.2 billion to shareholders through dividends and buybacks. For fiscal 2026, BD guided to low single-digit reported revenue growth (about 90 basis points of illustrative FX tailwind on top of low single-digit FXN growth) and adjusted diluted EPS of $14.75 to $15.05, implying roughly 2.4% to 4.5% growth. Management reaffirmed that the Biosciences and Diagnostic Solutions combination with Waters is expected to close around the end of calendar Q1 2026, which would create 'New BD.' Investors should weigh the solid margin expansion against modest organic growth, the gap between GAAP and adjusted earnings, and the execution risks around the Waters transaction, the Alaris infusion system's U.S. return to market, and China volume-based procurement.

02—Key points

Key Highlights

Q4 FY25 revenue of $5.89B grew 8.3% reported, 7.0% FXN and 3.9% organic; U.S. revenue grew 9.8% while international grew 3.2% FXN.
Q4 adjusted diluted EPS of $3.96 rose 3.9% (2.6% FXN); GAAP EPS of $1.72 rose 24.6%, helped by lower integration/restructuring and the prior-year SEC-related charge.
FY25 adjusted operating margin expanded 80 bps to 25.0% and adjusted gross margin rose 140 bps to 54.7%, driven by the BD Excellence program.
FY25 GAAP EPS of $5.82 declined 0.7%, with purchase accounting adjustments ($6.58/share), restructuring ($0.95) and product/legal items ($1.90) weighing on GAAP results.
FY26 guidance: low single-digit reported revenue growth, low single-digit FXN growth, and adjusted diluted EPS of $14.75–$15.05 (+2.4% to +4.5%).
Balance sheet: long-term debt fell to $17.6B and total debt to ~$19.2B (from ~$20.1B), with cash down to $641M; shareholders' equity was $25.4B.
Waters combination of the Biosciences and Diagnostic Solutions units remains on track to close around the end of calendar Q1 2026, creating 'New BD'; FY25 New BD organic growth was 3.9%.

03—Questions

Frequently Asked Questions

Why did GAAP EPS grow in Q4 but decline for the full year?
Q4 GAAP EPS rose 24.6% to $1.72, largely because Q4 FY24 carried heavier restructuring, transaction and an SEC-related accrual, and tax expense fell sharply ($17M vs. $114M). For the full year, GAAP EPS declined 0.7% to $5.82 because of higher purchase accounting amortization, restructuring, product and legal charges, and separation costs, partially offset by a lower tax provision.
How strong is the underlying growth after excluding acquisitions and currency?
Growth is moderate. FY25 organic revenue grew 2.9% (3.9% for New BD, which excludes Biosciences and Diagnostic Solutions). Reported growth of 8.2% was boosted by the Advanced Patient Monitoring acquisition (about $977M of inorganic revenue in FY25) and modest FX. Q4 organic growth of 3.9% was similar to the full-year rate.
What does the FY26 guidance imply for investors?
BD guided to adjusted EPS of $14.75–$15.05, about 2.4%–4.5% growth over $14.40, and low single-digit revenue growth. This is a relatively modest outlook, with the guidance excluding amortization, acquisition, restructuring, separation and certain legal charges, so GAAP EPS will be materially lower and less predictable.
What are the main risks flagged in the release?
Key risks include China volume-based procurement pressure (affecting MDS and Pharmaceutical Systems-related areas and Peripheral Intervention), weak vaccine demand, research funding pressure at Biosciences, the timing of the Alaris infusion system's U.S. return to market, tariffs and supply chain costs, litigation and product liability exposure, and execution risk on the Waters transaction, which may not close as planned.
Is BD generating enough cash to support its dividend and buybacks?
In FY25, operating cash flow was $3.43B (down from $3.84B), and after $760M of capital expenditures BD generated roughly $2.67B of free cash flow. That covered $1.2B of dividends and $1.0B of buybacks, though it was insufficient to fund all cash uses alone. Cash fell to $641M, and debt repayments of $1.8B were partially offset by $455M of short-term borrowing, so the company drew down its cash balance.

04—Continue

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