STERIS plc Q3 2026 results

What Management Said

In addition, on today's call, non-GAAP financial measures, including adjusted earnings per diluted share, adjusted operating income, constant currency organic revenue growth, and free cash flow will be used. Constant currency organic revenue grew 8% in the quarter, driven by volume as well as 200 basis points of price. Gross margin for the quarter declined 70 basis points compared with the prior year to 43.9%. EBIT margin decreased 40 basis points to 22.9% of revenue compared with last year, mainly driven by the decline in gross margin, which was somewhat mitigated by operating expense discipline.

Earnings per diluted share from continuing operations were $2.53, a 9% increase over the prior year. Capital expenditures for the first 9 months of fiscal 2026 totaled $278.8 million, and depreciation and amortization totaled $363.1 million. Free cash flow for the first nine months of fiscal 2026 was $736.6 million, with year-over-year improvement driven primarily by an increase in earnings and lower capital spending. Constant currency organic revenue grew 8% for the Q3, with growth across all categories.

Healthcare capital equipment revenue increased 7% for the quarter, with backlog remaining over $400 million. EBIT margins for Healthcare in the quarter decreased 100 basis points to 24.3%, as volume, pricing, and restructuring program benefits were more than offset by increased tariffs and inflation. Constant currency organic revenue grew 8% for the quarter, with 9% growth in services and 103% growth in capital equipment revenue. Constant currency organic revenue increased 5% for life sciences in the quarter, driven by 11% growth in consumables.

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