Thermo Fisher Scientific Inc

Good morning, ladies and gentlemen, and welcome to the Thermo Fisher Scientific 2026 third quarter conference call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I would like to introduce our moderator for the call, Mr. Rafael Tejada, Vice President, Investor Relations. Mr. Tejada, you may begin the call.

Good morning and thank you for joining us. On the call with me today is Marc Casper, our chairman and chief executive officer, and Jim Meyer, senior vice president and chief financial officer. Please note this call is being webcast live and will be archived on the ambassador section of our website, thermofisher.com, under the heading News, Events, and Presentations. until the next quarterly earnings call. A copy of the press release of our third quarter earnings is available in the investor section of our website under the heading financials. So before we begin, let me briefly cover our safe harbor statement. Various remarks that we may make about the company's future expectations, plans and prospects, constitute forward-looking statements within the meaning of applicable securities laws. Actual results may differ materially from those indicated by these forward-looking statements as a result of various risks and uncertainties, including those discussed in the company's most recent reports on Form 10-K and Form 10-Q under the heading Risk Factors. These forward-looking statements are based on our current expectations and speak only as of the date they are made. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so even in the event of new information, future developments, or otherwise. Also, during this call, we will be referring to certain financial measures not prepared in accordance with generally accepted accounting principles or GAAP. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures is available in the press release of our third quarter earnings and also in the investor section of our website under the heading financials. So with that, I'll now turn the call over to Marc.

Thank you, Raf. Good morning, everyone, and thanks for joining us today for our third quarter call. As you saw in our press release, we delivered another excellent quarter with outstanding financial performance. We're advancing our proven growth strategy and continuing to strengthen our trusted partner status with customers. Our PPI business system is enabling outstanding execution across the company. Looking ahead, we're incredibly well positioned to deliver an excellent 2026 as we continue to drive long-term value creation for all of our stakeholders and build an even brighter future for our company. To start, let me recap the third quarter financial results. Our revenue grew 9% to $12.14 billion. adjusted operating income grew 15% to $2.97 billion. Adjusted operating margin expanded by 120 basis points to 24.5%. And we grew adjusted EPS by 15% to $6.68 per share. Turning to our performance by end market, let me provide some details on how the quarter played out. Starting with pharma and biotech, We delivered high single digit growth during the quarter. Performance was led by our pharma services business and our research and safety market channel. We also had strong growth in our clinical research business. In academic and government, revenue was flat during the quarter. We saw good performance in our chromatography and mass spectrometry business. In industrial and applied, we delivered high single digit growth during the quarter. Performance was led by our electron microscopy business and our research and safety market channel. Finally, in diagnostics and healthcare, we grew low single digits during the quarter with strong growth in our transplant diagnostics business. So wrapping up the end markets, the improved end market conditions we saw in Q2 continued in Q3, and our team executed very well to capture the opportunities allowing us to deliver strong growth. Let me now turn to our growth strategy to share the progress we made during the quarter. As a reminder, our growth strategy consists of three pillars, high impact innovation, our trusted partner status with customers, and our unparalleled commercial engine. Starting with the first pillar of our growth strategy, it was another outstanding quarter of high impact innovation for our company. During the quarter, we launched a number of new technologies that strengthen our industry leadership and help our customers gain deeper scientific insights, enhance productivity and accelerate their innovation. In chromatography and mass spectrometry, we launched the thermoscientific Orbitrap Asura mass spectrometer, the first Orbitrap system for isotope ratio analysis. It makes this sophisticated analysis faster and easier to use, giving more researchers deeper insights into the origin and composition of samples across environmental and life sciences research. This product launch expands the served market for our Orbitrap franchise. In electron microscopy, we introduced the thermoscientific MPAD-G2 electron detector. This new technology enables faster and more detailed characterization of advanced materials, helping researchers gain deeper insights in support of the development of next-generation semiconductor and memory technologies. In specialty diagnostics, we launched the FDA-cleared ELEA CTD-13 screen in the U.S., expanding our autoimmune diagnostics offering. The new test helps laboratories streamline testing for systemic connective tissue diseases, including lupus, helping clinicians guide patient care. In genetic sciences, we introduced the IN560 chip, our highest throughput sequencing chip, for the iNGene Studio S5 platform. With nearly twice the sequencing capacity of our previous offering, it enables laboratories to process more samples in eTRON and meet the growing demand for genomic profiling in oncology research. I also want to give you an update on how we're deploying AI technology to further differentiate our products and service offerings. Let me give you two examples. In electromicroscopy, we've embedded AI-enabled software on our Cryos 5 and Glacios 3 cryo-electromicroscopes. Pharma and biotech customers are using these capabilities to automate workflows and support structure-based drug discovery across small molecules, biologics, and other modalities. The technology helps generate even higher quality data while reducing manual setup time by approximately 90%. As we've shared before, we're deploying agentic AI into our clinical research business. The combination of AI with our deep capabilities and extensive data gives us a unique opportunity to improve the speed, quality, and probability of success for clinical trials. As part of our ongoing efforts, we recently launched a new AI-based clinical research assistance. This agent leverages our extensive proprietary clinical and operational data, connecting multiple systems, which enables our team to focus more time on site engagement, risk assessment, and study quality. So another quarter of excellent high-impact innovation, further strengthening our industry leadership, advancing our customers' important work, and driving market share gain. Let me now cover the two remaining pillars of our growth strategy, are industry-leading commercial capabilities and trusted partner status enable our customer success. During the quarter, we continue to strengthen our position in both of these areas. In partnership with Mayo Clinic, we launched Precure, a new initiative that brings together Mayo Clinic's extensive biological samples and clinical insights with our differentiated proteomics capabilities including our O-Link technology and Orbitrap mass spectrometry. Together, these capabilities will help researchers identify the earliest biological signs of disease and provide a foundation of new discoveries in disease biology, diagnostics, and therapeutics. In South Korea, we opened our first AI Automation Innovation Center, bringing together our advanced analytical technologies with automation and AI. The center provides a collaborative environment where we work side by side with our customers to develop the next generation of scientific workflows that accelerate innovation and enhance R&D productivity. We also continue to invest to better service our customers. In Kentucky, we opened a new highly automated distribution center that strengthens our North American research and safety market and healthcare market channels. The new facility expands our capacity enhances speed, flexibility, and assurance of supply for our customers. So wrapping up on our growth strategy, we made great progress during the quarter. Turning to capital deployment, we continue to successfully execute our disciplined approach to capital deployment, which is a combination of strategic M&A and returning capital to our shareholders. We're very pleased with the progress of our Clario acquisitions. The business is performing well, the integration is going smoothly, and we're excited about the momentum building to deliver meaningful revenue synergies from the acquisition. We are connecting these leading capabilities into our broader offering for clinical development. In September, we reached the one year anniversary of the acquisition of our filtration and separation business. This business is performing very well, and it has strengthened our upstream and downstream bioproduction capabilities. and enhanced our ability to serve our pharma and biotech customers. Finally, during the quarter, we completed the divestiture of our microbiology business. Overall, we're very pleased with the progress we're making as our disciplined capital deployment strategy continues to create value for our customers and shareholders. Let me spend a moment on our PPI business system, which is a key enabler of our performance. We leverage PPI to draw strong profitability and free cash flow in the quarter. while continuing to improve the customer experience. We're also deploying AI across the company to further strengthen PPI, empowering our colleagues to continuously improve how we work and serve our customers even more effectively. The combination of PPI and AI is strengthening our execution today and creating even greater opportunities to drive productivity and value creation over time. Now I'd like to review our updated 2026 guidance at a high level. We're raising our guidance for the full year on the top and bottom line, reflecting another quarter of strong operational performance and continued strength in our end markets. We're raising our revenue guidance to a new range of $47.7 billion to $48.2 billion, representing 7% to 8% reported revenue growth over 2025. This reflects an increase to our full year organic revenue growth, which is now 4%. We're also raising our adjusted earnings per share guidance to be in the range of $25.13 to $25.43 per share, which now represents 10 to 11% growth over 2025. Jim will take you through the details in his remarks. So to summarize our key takeaways, We delivered outstanding financial performance in the quarter with organic revenue growth of 6% and adjusted EPS growth of 15%. The improved end market conditions we saw in Q2 continued in the third quarter with strong customer activity and our team is executing at a very high level, leveraging the power of our PPI business system to deliver very strong performance and create value for our stakeholders. Our proven growth strategy is resonating more than ever with our customers, and we're well positioned to deliver a great 2026 and build an even brighter future for our company. It's an incredibly exciting time for Thermo Fisher Scientific. With that, I'll turn the call over to Jim.