What Management Said
Read the full Q1 2026 transcript ↗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 basis. Core revenue growth is adjusted for the impact of currency exchange rates and any acquisitions and divestitures completed within the past 12 months. For the first quarter, Agilent reported $1.8 billion in revenue, growing 4.4% on a core basis within our November guidance range. The storm drove roughly a $10 million revenue impact, with the majority recovered at the beginning of February.
Adjusted for the impact of the storm, our first quarter revenue, operating margin, and EPS all would have been above the midpoint of our November guidance ranges, a healthy underlying outcome. Before getting into the specifics of our first quarter results, I want to share my thoughts on three key business initiatives that are fueling our growth. This business represents roughly 10% of our total services revenue today and has grown nicely at a low double-digit CAGR. Beyond the direct revenue contribution, the relationship we build with our customer creates tremendous long-term value for Agilent and uniquely position us to gain wallet share over time.
The insights that we gain from our leading services team are a key success factor in driving customer-focused innovation that underpins durable long-term growth at above-market rates. Already, 50% of the top 20 biopharma companies have ordered these columns since we launched, and Altura has more than doubled our bio column growth to over 30%, a testament to Altura's compelling performance. The launch is off to an excellent start, with strong demand out of the gate and extremely positive customer feedback versus competitor offerings. We're seeing a robust uptake, with growth of our single quad family exceeding 40% in the quarter.
What went well
- Q1 FY2026 revenue was $1.8 billion, up 4.4% on a core basis (7% reported), landing within the November guidance range despite an estimated $10 million revenue hit from a late-January US winter storm.
- Pharma grew 7% in line with expectations, with double-digit growth in biotech and solid mid-single-digit small-molecule growth, while GLP-1 revenue grew 50% overall (analytical labs +7%, CDMO +120%).
- Chemicals and advanced materials (CAM) grew 9%, above expectations, led by more than 20% growth in advanced materials on strong semiconductor demand and reshoring of fab capacity.
- New product cycles gained traction: the Altura column family more than doubled bio-column growth to over 30% with 50% of the top-20 biopharma companies ordering, and the ProIQ single-quad LC-MS drove single-quad family growth exceeding 40%.
- Ignite operating system delivered nearly 200 basis points of pricing in the quarter plus procurement savings, tariff reductions, and a new agilent.com site that grew digital orders at more than 2x the overall order book.
- Diagnostics and clinical grew 7% again, supported by the Omnis platform launch, and spectroscopy posted double-digit growth within AMG.
- By region, Asia was strongest with China up 6% (better than expected) and rest of Asia up a robust 13%; the enterprise services business (roughly 10% of total services revenue) is compounding at a low-double-digit CAGR with agreements at nearly all top-20 biopharma companies.
- Balance sheet remained strong at 0.8 turns net leverage; the company generated $268 million operating cash flow and returned capital via $152 million of buybacks and $72 million of dividends.
What went wrong
- A winter storm shut the Memphis logistics center for three days during the busiest shipping week of the quarter, costing roughly $10 million in revenue; excluding it, revenue, operating margin and EPS would have been above the November guidance midpoint.
- LDG grew only 3%, below mid-to-high-single-digit expectations, hurt by weather plus softness in academia and government that challenged cell analysis and genomics.
- Q1 gross margin fell 100 bps year-over-year to 53.7% and operating margin fell 50 bps to 24.6%, primarily on tariff headwinds and normalized performance-based pay.
- Americas revenue grew just 1%, directly hit by the weather and pockets of softness in smaller end markets; Europe was slower than expected at 4% as tariff discussions caused some customers to defer purchasing late in the quarter.
- Food declined 4% (though better than expected) against tough China-stimulus comps, and environmental & forensics was flat on continued weak government funding in the US and China.
- Small- and mid-cap biotech has not yet shown a meaningful uptick in investment despite an improving capital-markets backdrop, and academic customer budgets tied to government funding remain cautious.
Guidance Changes
| Metric | Period | Current guidance |
|---|---|---|
| FY2026 reported revenue | FY2026 | $7.3 billion-$7.5 billion (4%-6% core growth; ~1.5% FX tailwind) |
| FY2026 non-GAAP EPS | FY2026 | $5.90-$6.04 (5.5%-8% growth; +$0.04 on favorable FX) |
| FY2026 operating margin expansion | FY2026 | +75 bps at the midpoint |
| Q2 FY2026 reported revenue | Q2 FY2026 | $1.79 billion-$1.82 billion (~4%-5.5% core; ~3% FX tailwind) |
| Q2 FY2026 non-GAAP EPS | Q2 FY2026 | $1.39-$1.42 (6%-8% growth) |
| Q2 operating margin | Q2 FY2026 | ~100 bps improvement vs Q1 |
| FY2026 tax rate | FY2026 | 14.5% (unchanged) |
| FY2026 operating cash flow | FY2026 | $1.6 billion-$1.7 billion (unchanged) |
| FY2026 CapEx | FY2026 | ~$500 million |
| FY2026 pricing | FY2026 | at least 100 bps, supported by Ignite |
Performance Breakdown
| Metric | YoY | Note |
|---|---|---|
| Total revenue | +4.4% core (+7% reported) | Broad-based growth across largest end markets; FX +2.6%; partly offset by ~$10M storm impact. |
| Pharma | +7% | Double-digit biotech growth, mid-single-digit small molecule, GLP-1 strength and year-end budget-flush normalization. |
| CAM (chemicals & advanced materials) | +9% | Advanced materials up more than 20% on semiconductor reshoring and memory-chip demand for atomic spectroscopy tools. |
| Diagnostics & clinical | +7% | Continued momentum supported by the Omnis platform launch. |
| Environmental & forensics | flat | Soft US and China government funding, offset by growth in rest of Asia and Europe. |
| Food | -4% | Tough comp against prior-year China stimulus; outperformed expectations with low-double-digit growth ex-China. |
| GLP-1 | +50% | Analytical labs +7% and specialty CDMO +120%; oral and injectable testing exposure. |
| ACG segment | +6% | High-single-digit consumables growth, solid services and balanced global growth. |
| AMG segment | +4% | Ahead of expectations, led by double-digit spectroscopy on semiconductor strength. |
| LDG segment | +3% | Below expectations due to weather plus academia/government softness in cell analysis and genomics. |
| China | +6% | Better than expected; modest pre-Lunar New Year spend and a small SAMR/GACC stimulus (won ~30%). |
| Rest of Asia | +13% | Robust broad-based demand. |
| Europe | +4% | Slower than expected as tariff discussions delayed some purchasing late in the quarter. |
| Americas | +1% | Directly hit by the winter storm plus softness in smaller end markets. |
| Gross margin | -100 bps to 53.7% | Primarily tariff headwinds. |
| Operating margin | -50 bps to 24.6% | Increased tariff expense and normalized performance-based pay. |
| Non-GAAP EPS | +4% to $1.36 | Within guidance; would have been above midpoint excluding the storm. |
Earnings Call Themes & Trends
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Tariffs | Tariff headwinds weighing on gross and operating margin | Expected to be fully offset over the year via cost savings and pricing; guide unchanged even under a hypothetical 15% global minimum given no-regret supply-chain moves. | — |
| Ignite operating system | Launched early 2025 to drive execution excellence | Now the enterprise operating system; delivered ~200 bps pricing in Q1, procurement savings, BIOVECTRA integration playbook; expanding into AI, e-commerce and supply-chain workstreams. | — |
| Instrument replacement cycle | Early-stage recovery | Accelerating; Infinity III LC growing double digits at ~2x peers with notable share gains, still early-to-mid in the cycle. | — |
| M&A / capital allocation | Prioritize organic innovation, M&A, capacity, and shareholder returns | High bar for transformative deals; no size filter but very disciplined on right-to-win, integration and returns; Ignite gives confidence in integration capability. | — |
| Specialty CDMO (NASD/BIOVECTRA) | Ramping capacity | Low-double-digit Q1 growth, mid-teens expected for FY; booked into 2027 with Train C and D coming online; NASD ~60% commercial, BIOVECTRA ~one-third commercial. | — |
| Academia & government | Soft, cautious spending | Still soft, especially US; company believes it is at or near the bottom with budgets plateauing; expects low-single-digit full-year decline. | — |
| China | Stabilizing around $300M/quarter | Grew 6%; expected flat/~$300M per quarter with mid-to-high-single-digit long-term growth; potential larger year-end stimulus not in the guide. | — |
Q&A Summary
What was the snowstorm's revenue and margin impact, and has the delayed revenue been recouped?
About $10 million of revenue was affected when Memphis logistics shut for three days; the vast majority has already come back (recognized the following Monday), with some services pieces taking a bit longer. Margin impact was very modest, so reported Q1 was a reasonable proxy for actual performance.
What is the margin cadence to reach +75 bps for the year after a Q1 decline?
Q2 should improve ~50 bps year-over-year on pricing, volume and Ignite, offset by performance-based pay and tariffs; margin expansion accelerates in the second half as tariffs are fully mitigated, driven by volume leverage, pricing and Ignite, slightly offset by people costs and growth investments.
What drives the second-half revenue step-up versus the first half?
Strong underlying momentum in the biggest markets (pharma/GLP-1, replacement cycle, CAM +20% advanced materials), good funnel visibility and strong win-loss rates; the actual split is modest, roughly 49% first half and 51% second half.
How are tariff assumptions changing given the Supreme Court ruling and a possible 15% global minimum?
The situation is dynamic and details are unclear, but even assuming a 15% level Agilent would not change its guide, protected by no-regret supply-chain moves, pricing/surcharges and the flexibility of the Ignite system; management is ready to react as things evolve.
How would you describe the capital-equipment demand environment month by month, and appetite for a multi-billion-dollar deal?
Demand has been very steady with funnels steady-to-growing, a reasonable (not excessive) year-end budget flush and improving CapEx conditions from MFN deals; on M&A, capital allocation priorities are unchanged and the bar for a transformative deal is very high since the organic plan does not require one, though there is no arbitrary size filter.
What drove the light LDG result and its profitability?
LDG grew 3%, below expectations, due to weather and academia/government softness hitting cell analysis and genomics (which carry lower recurring-revenue mix); pharma, biotech and diagnostics grew high single digits. Margin was also affected by CDMO batch cadence in the quarter.
What did you see in specialty CDMO (NASD/BIOVECTRA) and is mid-teens growth still achievable?
Low-double-digit Q1 growth as expected on normal batch cadence; mid-teens full-year growth remains on the table based on production schedules and demand, with strong year-over-year order intake and a second-half ramp. NASD skews ~60% commercial versus roughly one-third commercial for BIOVECTRA.
What would push guidance to the high versus low end?
Upside from a pickup in small/mid-cap biotech spending, greater stability in academia and government, and a larger China stimulus; downside is the reverse - continued biotech pressure, worsening academia/government, and China declining low-single-digit versus the flat assumption.
How should we frame the atomic-spectroscopy upside from the memory shortage?
It is broader than the memory shortage - reshoring of fabs globally (including India, Asia and the Americas) plus AI-driven downstream chemical processing; the chemical business is about two-thirds advanced materials, and the energy/battery side is naturally hedged against oil volatility.
How is pharma performing outside of GLP-1s?
Biotech grew low double digits led by specialty CDMO, with the US recovery starting in well-funded large caps; small molecule was solid at mid-single digits with Asia leading at low double digits, and single-quad grew 40% at the QA/QC sweet spot.
Are the moving pieces a slow start in select markets, and is CAM/GLP-1 strength offsetting them?
Key markets (pharma, CAM, diagnostics) performed well with only small differences in smaller markets; the main issue was the storm hitting the biggest three days of the quarter. Full-year end-market guides are maintained, expected to land in roughly the same place.
How has Ignite improved M&A execution, and where do diagnostics/IVD assets rank?
Ignite is a cross-functional management system well suited to integrations, proven by the successful BIOVECTRA integration; diagnostics is a durable market (7% Q1 growth, mid-single-digit pathology) and not excluded, but any deal must fit strategy, offer a right to win and increase recurring revenue.
What is the NASD Train C utilization and margin trajectory into 2027?
Strong order backlog with confidence in FY2026; Agilent is booked out for 2026 and booking into 2027 with larger commercial batches. Train C and D ramp will create a negative margin impact in 2027, offset mainly through Ignite; at steady state specialty CDMO earns above the corporate operating margin.
Where is small-biotech capital-raise strength showing up in the business?
That comment was framed as a potential upside scenario, not current results - while the capital-markets profile is improving, Agilent has not yet seen a meaningful uptick in small/mid-cap biotech investment; exposure there is relatively small but management is encouraged by rising biopharma financing and M&A.
Was China's 6% growth all stimulus-related, and what is the outlook?
Not all stimulus - some pre-Lunar New Year spending plus a small SAMR stimulus (won ~30%), against a strong GACC comp last year; expected ~$300M per quarter, mid-to-high-single-digit long-term growth, with a possible larger year-end stimulus as upside not in the guide.
Where is the AMG softness by region?
Primarily in the Americas; NIH budget came in flat-to-slightly-up and the 15% overhead cap was blocked, but customers remain hesitant on bigger investments. Europe is expected to be more stable than the Americas with cautious optimism on incremental academic/government improvement (a forward-looking view).
What is the LC/LC-MS pacing and the financial impact of the enterprise-service wins?
LC grew high single digits with strength in China/APAC and notable Infinity III share gains, still early-mid in the replacement cycle; LC-MS was in line off tough compares with 40% ProIQ growth and share gains. Enterprise services act as a flywheel - higher consumables and services attach rates plus an early-warning system on replacement cycles and competitive displacement.
More on Agilent Technologies, Inc.
Reported 2026-02-25 · figures from the Agilent Technologies, Inc. Q1 2026 earnings call.
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