Danaher's Life Sciences Segment Shrinks: What's the Path Forward?

Danaher Corporation DHR is facing continued softness in its Life Sciences segment. In first-quarter 2025, core revenues from the segment declined 4% on a year-over-year basis. In the second quarter, the same decreased 2.5% year over year.

The drop was primarily due to lower demand for products across academic and government end markets. This has been weighing on the segment’s protein consumables, flow cytometry and lab automation solutions businesses. Softness in the genomics consumables business, owing to lower demand for plasmids and protein product lines in North America, remains concerning for the segment. Decreased demand for equipment is ailing the Life Sciences segment’s microscopy and mass spectrometry businesses’ performance of late.

However, increased demand for products in the microelectronic and aerospace end markets is supporting the segment’s filtration business. New products like the ZenoTOF 8600, which expanded DHR’s mass spectrometry footprint, are gaining traction. It’s worth noting that the company’s subsidiaries, IDT and Aldevron, helped develop the world’s first mRNA-based personalized in vivo CRISPR therapy. These advances show Danaher’s potential for growth in genomics and personalized medicine.

Low research funding, limited spending by small biotech firms and sluggish equipment sales may continue to hold back the company’s Life Sciences segment in the near-term.

Segment Snapshot of DHR's Peers

Among its major peers, CVS Health Corporation’s CVS Pharmacy & Consumer Wellness segment reported net sales of $33.6 billion in the second quarter of 2025, up 12.8% year over year. CVS Health generated 34% of its total sales from this segment in the quarter. Increased prescription and front store volume aided CVS Health’s segment’s results in the second quarter.

Labcorp Holdings Inc.’s LH Biopharma Laboratory Services segment generated net sales of $784.8 million in the second quarter of 2025, up 11% year over year. This was driven by Labcorp’s strong drug development capabilities and scientific expertise. Labcorp derived 22.1% of its total revenues from this segment during the quarter.

Price Performance, Valuation and Estimates

Shares of Danaher have lost 30.8% in the past year compared with the industry’s decline of 19.9%.

From a valuation standpoint, DHR is trading at a forward price-to-earnings ratio of 22.62X, above the industry’s average of 15.09X.

The Zacks Consensus Estimate for DHR’s 2025 earnings has increased approximately 1% in the past 60 days.

The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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