01—Abstract
Summary
Summary of the 10-Q filed October 30, 2026. Cited figures are marked; the original filing is the authoritative source.
Veralto Corporation's 10-Q for the quarter ended October 2, 2026 reports third-quarter sales of $1,509 milliona, up from $1,404 million a year earlier, with net earnings of $253 million versus $239 million.
For the nine months, sales were $4,405 millionb (versus $4,107 million) and net earnings were $748 million (versus $686 million), with diluted EPS of $3.03 compared with $2.74. The company states that core sales rose 5.1% in the quarter and 3.8% year to date, with acquisitions and currency also contributing to reported growth. Operating profit margin fell to 19.7% in the quarter from 23.2%, driven by a tax indemnification reduction tied to the Danaher separation, restructuring charges under the 2026 Cost Optimization Program, and acquisition-related costs.
The balance sheet expanded during the period. Goodwill rose to $3,200 million and other intangible assets to $820 millionc, reflecting the In-Situ and GlobalVision acquisitions. Cash and equivalents were $1,785 million at quarter end, and total debt was $2,920 million.
The company refinanced its $700 milliond 2026 Notes with a $725 million issuance of 2032 Notes and issued $250 million of commercial paper to help fund the Cleanwater1 acquisition, which closed on October 5, 2026 for $465 million. Shareholders received $96 million in dividends and the company repurchased $523 million of stock year to date under a $750 million program, with $227 million remaining.
Operating cash flow for the nine months was $845 million, up from $766 million. Management states it expects steady sequential sales in Product Quality & Innovation and continued growth in Water Quality, while noting ongoing uncertainty from tariffs and conflict in the Middle East.
02—Key points
Key Highlights
- Third-quarter sales rose to $1,509 million from $1,404 million, with core sales up 5.1% and acquisitions contributing 2.3 percentage points of growth.
- Quarterly operating margin declined to 19.7% from 23.2%, pressured by a reduction in the Danaher tax indemnification, restructuring charges, and acquisition-related costs.
- Nine-month net earnings reached $748 million, up from $686 million, and diluted EPS was $3.03 versus $2.74.
- Goodwill increased to $3,200 million from $2,838 million following the In-Situ and GlobalVision acquisitions, and the company announced the $465 million Cleanwater1 acquisition, which closed October 5, 2026.
- Total debt rose to $2,920 million, including a $725 million 2032 Notes issuance used to repay the $700 million 2026 Notes, plus $249 million of commercial paper.
- The company repurchased $523 million of common stock year to date, leaving $227 million under its $750 million authorization.
- Net cash from operating activities increased to $845 million from $766 million for the nine months, while the effective tax rate fell to 7.3% for the quarter due to a $47 million net discrete benefit.
03—Questions
Frequently Asked Questions
How did Veralto perform in the third quarter of 2026?
Sales increased to $1,509 million from $1,404 million, and net earnings rose to $253 million from $239 million. Core sales grew 5.1%, driven mainly by the Water Quality segment, while operating margin declined to 19.7% from 23.2% due to restructuring, transaction costs, and a reduction in the Danaher tax indemnification.
What acquisitions did Veralto complete?
In-Situ was acquired on January 22, 2026 for about $426 million net of cash acquired, and GlobalVision was acquired on April 7, 2026 for about $195 million. A further business was acquired for about $63 million. Cleanwater1 was acquired on October 5, 2026 for $465 million, subject to post-closing adjustments.
How is Veralto managing its debt and liquidity?
The company issued $725 million of 2032 Notes in June 2026 and used those proceeds, along with cash, to repay $700 million of 2026 Notes in August. It also issued $250 million of commercial paper to fund the Cleanwater1 acquisition. As of October 2, 2026, the company held $1,785 million in cash and cash equivalents and was in compliance with its debt covenants.
What is the status of shareholder returns?
Dividends paid totaled $96 million for the nine months, and a quarterly dividend of $0.13 per share was declared, payable October 30, 2026. The company repurchased $523 million of stock during the nine months, and $227 million remains under its $750 million Repurchase Program as of October 2, 2026.
What drove the decline in operating margin?
For the quarter, operating margin was reduced by a 260 basis point impact from lower Danaher tax indemnification, 150 basis points from restructuring charges under the 2026 Cost Optimization Program, and 70 basis points from strategic initiative costs, including acquisition transaction costs. These were partially offset by higher core sales.
04—Continue