Bruker Corporation

Good day and welcome to the Bruker Corporation first quarter 2026 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star key followed by zero. by one on a touch tone phone. And to withdraw your question, please press star then two. Pleasing note, this event is being recorded. I would now like to turn the conference over to Joe Kostka, Director of Brewker's Investor Relations. Please go ahead.

Good morning. I would like to welcome everyone to Brewker Corporation's first quarter 2026 earnings conference call. My name is Joe Koska, and I'm the Director of Brooker Investor Relations. Joining me on today's call are Frank Laukeen, our President and CEO, and Gerald Herman, our EVP and CFO. In addition to the earnings release we issued earlier today, during today's conference call, we will be referencing a slide presentation that can be downloaded from the Events and Presentations section of Brooker's Investor Relations website. During today's call, we will be highlighting non-GAAP financial information. Reconciliations of our GAAP to non-GAAP financial measures are included in our earnings release and are posted on our website at ir.bruker.com. Before we begin, I would like to reference Bruker's safe harbor statement, which is shown on slide two of the presentation. During this conference call, we will or may make forward-looking statements regarding future events in the financial and operational performance of the company that involve risks and uncertainties, including those related to our recent acquisitions, geopolitical risks, wars or blockades, market demand, tariffs, currency exchange rates, competitive dynamics, or supply chains. The company's actual results may differ materially from such statements. Factors that might cause such differences include, but are not limited to, those discussed in today's earnings release and in our Form 10-K for the period ending December 31, 2025, as updated by our other SEC filings, which are available on our website and on the SEC's website. Also, please note that the following information is based on current business conditions and our outlook as of today, May 6, 2026. We do not intend to update our forward-looking statements based on new information, future events, or for other reasons except as may be required by law prior to the release of our second quarter 2026 financial results, expected in early August 2026. You should not rely on these forward-looking statements as necessarily representing our views or outlook as of any date after today. We will begin today's call with Frank providing an overview of our business progress. Gerald will then cover the financials for the first quarter of 2026 in more detail and comment on our reconfirmed full year 2026 financial outlook. Now, I'd like to turn the call over to Brooker's CEO, Frank Laukeen.

Thank you, Jill. Good morning, everyone. Thank you for joining us on today's first quarter 26 earnings call. While U.S. academic demand, tariffs, and currency headwinds have continued to pressure our year-over-year results, we are pleased that our first quarter 26 financial performance came in well ahead of expectations. We are also encouraged that in the first quarter, our Brooker Scientific Instruments Segment, or BSI, bookings grew organically in the high single digits. We saw strength in industrial research orders and encouraging double-digit bookings growth year over year in academic orders from outside the United States. This demonstrates, we think, that our novel and performance-leading post-genomic disease biology research solutions are truly enabling and that we can expect momentum in U.S. ACAGOV demand once the NIH funding environment improves. In the first quarter, we benefited from strong demand in a few areas more unique to Bruker as our AI-driven semiconductor metrology business and our similarly AI-driven SciWise scientific software and lab digitization businesses, as well as our European Middle East security detection business, all saw organic bookings growth of greater than 20% in the quarter. Let me give you a little bit more color order strength in semi-metrology. which is now a greater than $300 million annual revenue business for Brooker, was driven by a high demand for memory chips and for advanced packaging, particularly in the U.S. and in APEC. Many of the world's top semiconductor manufacturers rely on Brooker metrology tools for front-end and back-end applications, including development for their next-generation products. The rapidly increasing need for computing power and emerging applications for artificial intelligence provide strong secular tailwinds in semi-metrology. Another area that may have been less visible to you so far, another area of our portfolio benefiting from the AI megatrend is CyY, which is now about a 50 million revenue business. CyY offers lab digitization and scientific software going from research through development all the way to manufacturing and enabling integration, automation, and digital transformation. These DIY solutions facilitate the capture, ingestion, and standardization of data so that it is AI-ready, alleviating bottlenecks in the digital transformation that is revolutionizing scientific research and paves the path to so-called self-driving labs, or SDL, which can accelerate R&D, quality control, and also chemical and biomolecular manufacturing. In another area, our security detection business, we are seeing significant demand for our explosive stress detection systems from airports in Europe and the Middle East, as well as for CBRN detection solutions. Our security detection business has grown from a niche business a few years ago to about $70 million in revenue expected this year. Finally, we are delighted in the turnaround in our best segment, where we have obtained in the first quarter about $80 million of multi-year orders for our research instrument subsidiary Fusion Technologies, Fusion Energy. And In the last five months, December through April, about 600 million of multi-year orders for our high-performance superconductors from major MRI customers. So all good at best. So strong academic demand for our post-genomic solutions outside of the U.S. And these mentioned areas of idiosyncratic strength were contributors to our BSI book-to-bill ratio, which in Q1 was, again, comfortably above 1.05. now the third consecutive quarter. This encouraging momentum is expected to carry us back to organic revenue growth in the second quarter and for the remainder of the year. Very importantly, Bruker's innovation engine has been quite impressive, we think, this year already, and we have introduced very impactful new products and solutions at recent scientific and medical conferences. These launches further strengthen our leadership position in NMR, I think we are clearly leading the way in multi-omic, high-fidelity, and high-flex spatial biology. And we're also bringing major innovations to clinical microbiology and molecular diagnostics. So let's dig in. Let's turn to slide four now for the P&L performance of the business. Our Q1 reported revenues of $823 million increased 2.7% year over year. an FX tailwind of 4.5 and a growth contribution from M&A of 2.6%, more than offset an organic decline of 4.4%. BSI segment revenues were down 5% organically, while best saw organic revenue growth of 3% net of intercompany eliminations. Our first quarter 26 non-GAAP growth and operating margins were 50% and 10.2% respectively, both down year-over-year and both inclusive of significant headwinds from foreign currency trends year-over-year, but also both ahead of expectations. Our Q1 26 diluted non-GAAP EPS was 31 cents, down from 47 cents in the first quarter of 25, but meaningfully ahead of our prior expectations. Please turn to slides five and six, where we highlight the first quarter constant exchange rate, or CER, revenue and bookings performance, of our three scientific instruments groups and our best segment year-over-year. In the first quarter BioSpin group, revenue was 198 million with a CER decline in the high single-digit percentage. Revenue growth in preclinical imaging systems, CyY software, and our services business were more than offset by weakness in NMR systems due to soft ECGAL performance in China and Europe. In the first quarter, BioSpin installed the world's highest-field preclinical MRI system, an 18-Tesla preclinical system at the Champollion Institute in Lisbon, Portugal. However, BioSpin saw a headwind to revenue growth from the 1.2 GHz NMR installed in the first quarter of 2025, as there were no GHz-class systems in Q1 of 2016. Right. In Q1, our CALIC group had revenues of $316 million with mid-single-digit percentage CER growth. CALIC growth was led by molecular spectroscopy, which also saw strength in security detection orders. Microbiology and infection diagnostics had solid revenue growth, and in life science mass spectrometry, contributions from our recent M&A more than offset revenue software in U.S. ACAGOV. Encouragingly, life science mass spec orders growth in the U.S. was positive in Q1 year-over-year, so perhaps it is stabilizing. Of course, we'd like it to come back and rebound, but maybe that'll happen in the next couple of quarters. Turn to slide six now. In Q1, Brooker Nano revenue was $246 million, with CER revenue declining mid-single-digits percentage. Strong revenue growth in semi-metrology was more than offset by weakness in AgaGov and industrial markets. Nano had strong orders across the group, including tools for X-ray industrial research, spatial biology, high bandwidth memory, and advanced packaging metrology, all driven by AI. Finally, first quarter best CR revenues grew 3% net of intercompany eliminations, driven by our superconducting wire business. Research Instruments, RI, that business saw very strong orders in Q1, as I said earlier, from Fusion, and best received very large multi-year superconductor orders in the last five months from all three major MRI OEM customers. Moving on to slide seven, the next three slides, I will not read everything, but I'll give you a highlight. We had pretty significant NMR innovations at the experimental NMR conference in Asilomar in 2026 for research and pharma markets. A lot of it is software. A lot of it is AI-driven, making protein NMR really much easier. In the past, I think protein NMR had a disadvantage compared to cryo-EM. or X-ray crystallography in that it required more expertise, but that's really pretty changing pretty rapidly. And AI with its unique abilities to get dynamic and binding information is becoming much, much more accessible. There are some other innovations from extreme new sensitivities and enable new fields shown on the right to just a good old next generation NMR console, the Advanced NeoX, which we think will unlock a replacement cycle. Moving to slide eight, at AGBT and then following AACR, I really think Bruker is clearly leading the way in spatial biology for capturing complexity of disease biology and integrating it from, well, even 3D genomics with a very unique paintscape system that we launched. to the COSMIC system, which is upgradable for our customers and which, of course, were already a year ago. We showed multi-omic human transcriptome. We've added now a whole mouse transcriptome. We're doing T-cell receptors, microRNA, and most importantly, or very importantly, I would say, we have added HyPlex proteomics, that combination of whole transcriptome and HyPlex proteomics is really very, very powerful and readily adopted by comprehensive pathways for better LLMs or just for better disease biology. We think that continues to be very unique. Enough on that slide. Let me talk about clinical microbiology in slide nine. We had another conference, crucial conference, the Global ESMID Conference, which stands for Clinical Microbiology in Infectious Disease in Munich. Introduced our new MyGenius Pro higher throughput system, sample to answer higher throughput system for all the markets that we drive from Bruker Elitech. And delightfully, this is also the system that Hitachi is introducing in Japan using our molecular diagnostic assays. This is very, an important development. Meanwhile, we have many, many introductions, too many to specify in the multi-biotyper workflow and identification and even hospital acquired using the IR biotyper. I won't go through it. This is more for your reading if you are interested. But significant innovation in microbiology, typically a state area of diagnostics. Right. So in summary, Good execution, disciplined management by our teams drove us to outperform our expectations in the first quarter. Order trends are improving, including in unique areas of our diversified portfolio, and we're optimistic that improved organic growth will follow. Importantly, we're very committed to controlling and reducing costs, which is crucial to improving our margin profile rapidly. Benefits from our cost-out plans and broker management process will be explained by Gerald, but are now clearly evident in our P&L, and we're further expanding these cost-cutting initiatives, as Gerald will discuss shortly, keeping us on track not only for significant margin expansion and strong EPS growth this year, but also into next year and beyond. Given the dynamic macro, shall we say, and geopolitical environment, we believe it is prudent for now to confirm our prior 26 guidance. The outperformance in Q1 has been encouraging, an encouraging start to the year, and it provides us with improved visibility and confidence, and we look to build on that momentum in the second quarter. So with that, let me turn things over to our CFO, Gerald Thurman. Go ahead.