Bio-Rad Laboratories Reports a Quarter of Contrasts

Bio-Rad Laboratories US0905722072

Bio-Rad Laboratories' latest quarterly earnings presented a mixed financial picture, with revenue exceeding forecasts but profitability metrics falling short. The company's performance was significantly impacted by a non-cash accounting charge related to one of its strategic investments.

Key Financial Results for Q3 2025:
* Adjusted Diluted EPS (Non-GAAP): $2.26, missing the consensus estimate of $2.30.
* Total Revenue: $653.0 million, a nominal increase of 0.5% year-over-year and slightly above analyst expectations.
* Reported Net Loss (GAAP): ($341.9) million, primarily driven by the revaluation of an equity holding.

On a currency-neutral basis, quarterly sales declined by 1.7% compared to the same period last year. This overall figure masks divergent trends within the company's two main operating segments.

The Life Science Group generated $261.8 million in revenue, representing a nominal 0.3% increase but a 1.5% decrease on a currency-adjusted basis. Management cited persistently constrained research spending at academic institutions and ongoing tight funding in the biotechnology sector as key headwinds.

Meanwhile, the Clinical Diagnostics Group reported sales of $391.2 million, up 0.6% nominally but down 1.8% when adjusted for foreign exchange. This segment's performance was pressured by lower reimbursement rates for diabetes testing in China.

The substantial GAAP net loss was largely attributed to a mark-to-market revaluation of the company's investment in Sartorius AG. Excluding this and other one-time items, the non-GAAP bottom line remained positive, though it narrowly missed the per-share earnings forecast.

This quarter's results mark a shift from the previous period. In Q2 2025, Bio-Rad posted a stronger non-GAAP net income of $71.0 million, or $2.61 per diluted share, on a revenue base of $651.6 million. The company also completed its acquisition of Stilla Technologies during that quarter.

Market Sentiment and Shareholder Activity

Current analyst ratings for Bio-Rad reflect a cautious stance. An aggregate of six broker firms yields an average recommendation of "Hold," comprising one "Sell," two "Hold," and three "Buy" ratings. The consensus 12-month price target stands at $358.50, while the shares recently traded near $308, giving the company a market capitalization of approximately $8.31 billion. The reported GAAP net margin was deeply negative at 26.43%.

Institutional investors collectively hold about 65.24% of the company's equity. Notably, Hound Partners reduced its stake by 9.8% in the second quarter and now holds 181,936 shares valued at roughly $43.91 million. On the insider trading front, an Executive Vice President, James Barry, filed a notice on November 6 for the sale of 700 shares, reducing his reported holdings by 57.85%.

Confirmed Outlook for the Fiscal Year

Despite the quarterly challenges, company leadership reaffirmed its full-year guidance for 2025 following the Q3 report. Bio-Rad continues to anticipate currency-adjusted revenue growth in the range of approximately 0% to 1.0% on a non-GAAP basis. The non-GAAP operating margin is still projected to be between 12.0% and 13.0%.

Looking ahead, the company's trajectory will be closely tied to demand dynamics in the research and biotech funding environment, reimbursement trends—especially in China—and potential future valuation changes to its equity investments.