Agilent Technologies, Inc.

Ladies and gentlemen, thank you for joining us and welcome to the Q2 2026 Agilent Technologies Inc. Earnings Conference Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please raise your hand. If you have dialed in to today's call, please press star 9 to raise your hand and star 6 to unmute. I will now hand the conference over to Tejas Savant, Vice President of Investor Relations. You may begin.

Thank you, Corina, and welcome everyone to Agilent's conference call for the second quarter of fiscal year 2026. With me on the line are CEO Parag McDonnell and CFO Adam Elanoff. Joining for the Q&A will be Simon May, President of the Life Sciences and Diagnostics Markets Group, Angelica Reimann, President of the Agilent CrossLab Group, and Mike Zheng, President of the Applied Markets Group. this presentation is being webcast live the press release for our second quarter financial results investor presentation and information to supplement today's discussion along with a recording of this webcast are available on our website at investor.agilent.com today's comments will refer to non-gap financial measures Non-GAAP measures are supplemental and should not be considered a substitute for GAAP results. You'll find the most directly comparable GAAP financial metrics and reconciliations in the press release and on our website. Unless otherwise noted, all references to increases or decreases in financial metrics are year-over-year, and references to revenue growth are on a core or organic constant currency basis. All references to profitability metrics are on a non-GAAP basis. Core or organic constant currency revenue growth is adjusted for the impact of currency exchange rates and any acquisitions and divestitures completed within the past 12 months. Guidance is based on forecasted exchange rates. During this call, we will make forward-looking statements about the financial performance of the company. These statements are subject to risks and uncertainties and are only valid as of today. Agilent assumes no obligation to update them. Please refer to the company's recent SEC filings for a more detailed description of the risks and other factors that would cause our performance to differ from these forward-looking statements. And now, I'd like to turn the call over to Parag.

Thanks Tejas and welcome everyone. We delivered an excellent second quarter with stronger than expected revenue growth, significant margin expansion and double digit EPS growth. Importantly, the quarter demonstrates that the operational and P&L benefits from our Ignite operating system are increasingly becoming structurally embedded in the business. For the second quarter, Agen reported $1.83 billion in revenue, growing 6.3% on a core basis and exceeding the high end of our guidance by 80 basis points. The strength was broad-based across our largest end markets and supported by continued replacement cycle momentum, innovation-led share gains, and improving operational execution. Operating margin of 26.4% for the quarter represents a year-over-year improvement of 130 basis points and 180 basis points on a sequential basis, well above our guidance despite the macro and geopolitical environment. Earnings per share of $1.49 represents 14% year-over-year growth, which also exceeded the top end of our guidance by 7 cents. We delivered at or above our long term plan on all metrics revenue growth, margin expansion and EPS growth. As we enter the second half, I want to highlight the key dimensions of our strategy that are driving our performance. First, we continue to build on the extraordinary level of customer intimacy and trust that we have worked hard to gain and differentiates us from the competition. This differentiation is increasingly translating into share gains across the key workflows and geographies. Second, that trust translates into insights that inform our innovation flywheel, leading to products and services that drive success for our customers and Agilent. That includes the exciting launches coming up next week at the 74th American Society for Mass Spectrometry annual conference in San Diego. Next, we have increased capabilities and the level of talent throughout the organization, improving speed, agility, and operational discipline. This is driving a step function improvement in execution. And finally, the significant benefits of Ignite are increasingly plain to see. These include strategic pricing that is aiding our top line momentum, productivity initiatives such as simplifying our structure and generating greater value through strategic relationship management, a centralised focus on project outcomes that drives business results, and increasing supply chain agility and operational discipline that is strengthening margins and business resiliency while providing flexibility to fund our most critical innovation efforts. With our diversified and geographically balanced portfolio and healthy momentum across key end markets, the strong foundation we have built through Ignite provides us with the resiliency to compound our success and deliver results in any environment. Importantly, we expect these operational improvements to increasingly support higher quality and durable earnings growth. Before getting into the specifics of our second quarter results, I want to spend time on the key growth drivers going forward. These include superior commercial execution combined with improvement we're seeing across our end markets, the instrument replacement cycle, our exciting slate of launches at ASMS, and our recent agreement to acquire Biocare, and how Ignite is fueling Agilent's performance. We are seeing continued health in our key end markets, aligned with our expectations at the start of the year. Combined with commercial execution, our differentiated portfolio, and best in class service, that health is driving our results. Pharma continues to deliver with 6% growth in the quarter. This includes another quarter of low double digit growth in biotech led by large caps, while positive demand signals from small to mid caps begin to emerge. Chemical and advanced materials grew a robust 8%. It was fueled by strong semiconductor demand and healthy chemical capex investments in the Americas. Diagnostics and clinical grew 11%, driven by the strong performance of expanding cancer and diagnostics offerings. And finally, our unique technology is helping us win outsized shares of forensics, where we deliver greater than 50% growth in the quarter. That includes the TSA security contract we mentioned during the last call, as well as multiple competitive large tender wins in Asia and Europe. Regarding the TSA contract, we are delighted to be able to share more details that you might have seen in our recent press release. The TSA will deploy our new bulk alarm resolution technology at airport security checkpoints at the FIFA World Cup host cities in the US. This unique technology provides the ability to screen larger quantities of liquids, powders and solids. With the implementation going very well, we are excited about the opportunities to apply this technology more broadly. We also had another very strong quarter of instrument revenue, resulting in high single-digit growth. This included market-leading low double-digit growth in LC and LC-MS and in GC. Our replacement site momentum continued. That plus share gains driven by the customer-centric innovation that is embedded in our new Infinity Tree LC and our 8850 GC are delivering exceptional growth. As customers are looking to upgrade their fleets, they see how new instruments solve their most challenging workflow problems while improving efficiencies. Looking ahead, we see continued instrument strength. Our commercial excellence delivered a book to build above one again this quarter, marking the ninth consecutive quarter where instrument orders met or exceeded revenue. Even as recent launches like the Infinity 3LC and Omnless Family continue to drive growth, we are looking forward to our next wave of innovations that will further support our durable growth, strengthen our install base, and support recurring consumables and services pulled through. We will showcase these new launches at ASMS next week. I'll start in spectroscopy with a revolutionary new 9500 triple quad ICP-MS. This launch brings advanced triple quad capabilities to a broader customer base by directly addressing key customer pain points around throughput, workflow complexity, and operating costs. The 9500 solves these challenges with a patented dual cell system that provides increased throughput, a revolutionary air mode that eliminates the need for dedicated oxygen gas, lowering operating costs, an intelligent open lab ICPMS software that reduces complexity and automates method migration, lowering the technical expertise required to operate the system. This versatile instrument will be relevant across our customer base in advanced materials, mining, food and environmental labs. Importantly, the innovations embedded in the 9500 were a direct result of customer feedback about their most pressing problems and will serve as a differentiated architecture for ICP-MS growth well into the future. Moving to our gas phase business, we are launching the upgraded flagship GCs. These launches further strengthen our position in high productivity analytical workflows where our customers increasingly prioritize efficiency, automation, and total cost of ownership. Highlights of our new GCs include improved performance with up to 30% faster oven cool down and higher throughput. built-in intelligence features to monitor performance track parameters and assist in proactive maintenance and the technology to conserve or eliminate helium gas with real-time gas and power usage tracking we've been a long-standing leader in providing helium alternatives for GCs in response to customer needs in the current helium supply environment these productivity and resource efficiency benefits are becoming increasingly valuable for customers Turning to our consumables portfolio, our Altura Ultra inert LC columns continue to see strong traction. They grew more than 50% sequentially, reaching 75% of the top 20 biopharma accounts. This rapid adoption reinforced the strength of innovation engine and unified commercial organization. We will continue to build on that strong initial momentum with additional waves of column launches. Our newest Altura columns debuting at ASMS are targeted to address workflows for protein and peptide therapeutics, large oligos, gene therapy, and vaccines. On a software front, we're also expanding our capabilities in OpenLab CDS with version 3.0. This important release provides a unified platform to support analysis for chromatography, mass spec and spectroscopy systems across our portfolio, including for the first time our high resolution mass spec. The continued expansion of OpenLab further strengthens workflow integration across our portfolio and enhances the strategic value of our install base. We're also delighted to announce that we're building upon our long history in China with the launch of our China Innovation Center. Leveraging the country's deep base of technical talent and a vibrant innovation ecosystem, we intend to strengthen our R&D capabilities across multiple emerging areas, including digital, AI, and automation to better support our customers. We are particularly excited about automation, where we see excellent potential to build on our in-house capabilities with unique automation development expertise in China. Turning to the four pillar of our strategy, I want to provide an update on the impact of our Ignite operating system that is building enterprise capabilities and driving a culture of accountability and execution excellence. Ignite had a significant impact on the business on both the top and bottom lines during the quarter, and is poised to deliver compounding benefits in the years to come. Our strategic pricing capability delivered approximately 200 basis points of pricing in Q2, putting us on a path to exceed our initial full year goal of 100 basis points. We also reached an important milestone during Q2, with the Tariff Task Force achieving full mitigation of the incremental tariffs that began in late spring. The combination of strategic manufacturing moves and targeted price adjustments have now fully offset the operating profit impact of these tariffs. This task force also helped us build a playbook for addressing trade and geopolitical challenges, which has been a critical resource in navigating the current Middle East conflict. Our digital initiative is driving accelerated growth of our e-commerce platform, delivering ease of use for customers and lower cost per transaction for Agilent. In Q2, new digital orders grew 9%, including more than 20% ex-China. Ignite has transformed our supply chain capabilities, making it a competitive advantage. A recent example of this is our quick response to the logistic challenges and material shortages arising out of the conflict in the Middle East. Ignite is providing incremental procurement savings and supply chain resilience that gives us confidence as we work to absorb inflationary cost pressures during the remainder of the year. On the M&A front, we're excited to announce the Biocare acquisition in March. I am confident that the robust long-term growth, strong strategic fit and opportunities for synergy realisation make the financial returns on this transaction highly attractive. Ignite is driving our pre-closed preparations for the Biocare integration. ensuring we are ready to hit the ground running as soon as the transaction closes. I look forward to welcoming our new colleagues to Agilent later this year. While it's been tremendously satisfying to see Ignite's impact to date, there's a lot more to come. This includes our push for manufacturing excellence, where we are being front-footed in building resilience across our business and setting up the organisation to deliver durable long-term growth. We built our AI-enabled supply chain control tower to create greater prediction and adaptive calibration of our supply and demand plans, leading to inherent resiliency, faster issue response times, and much higher schedule attainment. After implementing this new capability, we have seen continued meaningful improvement in schedule plan attainment, order conversion ratios, and overall cycle times. We've also reconfigured our operations organization to add greater depth in planning, lean manufacturing, and digital engineering. All of this contributes to improved delivery, greater agility, and optimized cost structure. That in turn reduced manufacturing overhead by more than 50 basis points versus last year. The 9,500 ICP-MS we are featuring at ASMS is a great demonstration of how our Ignite operating system is accelerating our innovation, expediting the launch by a full quarter. our optimized approach to innovation, enable faster decisions and more focused capital allocation. We clearly established the 9500 as the top priority and dynamically reallocated resources to accelerate timelines and outcomes. We reinforce this through focused discipline, cross-functional execution across sales, R&D and manufacturing teams. The teams work closely to accelerate technology transfer and improve yields, pulling our production readiness forward. Last but not least, AI is a key FY26 enterprise focus area for us. AI has the potential to be a tremendous growth driver for the life sciences industry. Pharma customers are leaning into AI to accelerate drug development and reduce the odds of expensive late stage failures. There is a growing need for large-scale multimodal datasets to train AI models, which will require significant investments in the wet lab. By moving the needle on drug development ROI, AI holds the promise of putting our largest customer constituency on a better footing. And a higher number of approvals coming through the drug pipeline should be a strong tailwind for us, giving our leading position in downstream manufacturing QAQC workflows. In light of the regulatory and patient safety aspects of commercial scale drug manufacturing, we believe this part of the value chain will meaningfully benefit from AI use upstream. Beyond being accretive to our top line in the medium term, we are also deploying AI within our own business. I look forward to sharing more details on our AI efforts very soon. Now, let me share some additional details on our Q2 results, starting with our end markets. As I mentioned earlier, pharma grew 6% this quarter, marking the fifth consecutive quarter of growth in the mid single digit to low double digit range. Within pharma, biotech grew low double digits for the third consecutive quarter, while small molecule grew low single digit. Our GLP-1 momentum continues, delivering about 20% growth year to date. with a robust contribution from the analytical lab business in the second quarter. We also remain engaged with our large pharma customers about their plans to reshore operations to the US. We continue to expect initial orders at the end of our fiscal year with revenue starting in FY27. CAM grew 8% and diagnostics and clinical grew 11%, both exceeding expectations. Environmental forensics delivered 13% growth compared to the low single-digit guide, with the upside in forensics, as I mentioned earlier. Environmental delivered low single-digit growth against a challenging double-digit year-over-year compare. Food, our second smallest end market, declined 3%, with softer than expected results in Asia due to funding delays in China and India. Academia and government, our smallest end market, declined 5% in line with expectations. Most importantly, our customer-centric approach is working and we continue to win against the competition in all major geographies with share expansion, again, validated by industry market share data. Turning to updated guidance, billing on an excellent second quarter, and with the outlook for our end marks broadly consistent with our original expectations, we now expect core growth of 4.5% to 6% for the full year. At the midpoint, this represents an increase of 30 basis points versus our prior guide. we are also increasing our expectations on the bottom line with updated EPS guidance of $6 to $6.10 for the full year, an increase of $0.08 at the midpoint. And with that, let me hand it over to Adam, who will provide additional details on the quarter and our financial outlook for the remainder of the year.