Waters Q3 Earnings Surpass Estimates, Revenue Increase Y/Y

Waters Corporation WAT reported third-quarter 2025 non-GAAP earnings of $3.40 per share, beating the Zacks Consensus Estimate by 5.92% and increasing 16% year over year. 

Net sales of $800 million topped the Zacks Consensus Estimate by 2.59%. The figure increased by 8% both on a reported basis and on a constant currency (cc) basis year over year.

Waters’ Q3 Top Line in Detail

WAT operates under two organized segments: Waters and TA. The Waters segment generated sales worth $713.4 million, up 9% both on a reported and cc basis, year over year. Sales in the TA segment were $86.5 million, reflecting year-over-year growth of 2% both on a reported and cc basis.

Products & Services: The division comprises three segments: Instruments, Services, and Chemistry. Instruments sales were $341.5 million, increased 6% on a reported and cc basis, year over year. Services sales were $299.9 million, which increased 8% year over year on a reported basis and 7% at cc. Chemistry sales were $158.5 million, which grew 14% on a reported basis and 13% at cc, year over year. The Services and Chemistry segments jointly generated recurring revenues of $458.4 million, up 10% on a reported basis and 9% at cc, year over year.
 

Waters Corporation Price, Consensus and EPS Surprise

Waters Corporation price-consensus-eps-surprise-chart | Waters Corporation Quote

Waters serves three end markets: Pharmaceutical, Industrial, and Governmental & Academic. The Pharmaceutical market generated sales of $479.8 million, which increased 12% on a year-over-year basis, reportedly and 11% at cc. Industrial sales were $235.7 million, up 3% reportedly and 4% at cc, on a year-over-year basis. Government & Academic sales increased 2% reportedly and 1% at cc to $84.4 million.

Waters’ operating regions include Asia, the Americas and Europe. Asia generated sales of $269.7 million, up 7% and 13% on a reported and cc basis, respectively. Americas sales were $292.8 million, which increased 5% in both reported and cc terms. Europe generated sales of $237.4 million, which increased 13% reportedly and 5% at cc.

WAT’s Q3 Operating Details

In the third quarter of 2025, non-GAAP selling and administrative expenses were $179.7 million, up 8.3% year over year. As a percentage of net sales, the figure was flat on a year-over-year basis.

Research and development expenses of $49.9 million increased 11.7% year over year. As a percentage of net sales, the figure increased 20 bps year over year.

The adjusted operating margin was 30.3%, which contracted 50 bps year over year.

Waters Balance Sheet & Cash Flow

As of Sept. 27, 2025, cash and cash equivalents were $459.1 million, up from $367.2 million as of June 28.

Waters generated cash from operations of $187.3 million in the reported quarter. The company reported a free cash flow of $159.6 million.

WAT Raises 2025 Guidance

Waters raises 2025 cc sales growth guidance between 6.7% and 7.3%. Sales growth on a reported basis is expected in the 6.5%-7.1% range. 

Waters is raising 2025 non-GAAP earnings in the $13.05 to $13.15 per share range. This reflects
year-over-year growth of approximately more than 10% to more than 11% and more than 11% to more than 12% on a cc basis.

For the fourth quarter of 2025, Waters expects cc sales growth between 5% and 7%. Sales growth on a reported basis is expected in the 5.2%-7.2% range. 

Waters expects non-GAAP earnings in the $4.45 to $4.55 per share range. This reflects year-over-year growth of approximately more than 9% to more than 11%.

Zacks Rank & Upcoming Earnings to Consider

Currently, Waters carries a Zacks Rank #3 (Hold).

ACADIA Pharmaceuticals ACAD, ANI Pharmaceuticals ANIP and Alcon ALC are some better-ranked stocks that investors can consider in the broader Zacks Medical sector.

ACADIA Pharmaceuticals shares have appreciated 19.1% year to date. This Zacks Rank #2 (Buy) company is scheduled to release third-quarter 2025 results on Nov. 5. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

ANI Pharmaceuticals shares have returned 71% year to date. ANI Pharmaceuticals is scheduled to release third-quarter 2025 results on Nov. 7. ANI Pharmaceuticals has a Zacks Rank #2.  
 
Alcon shares have dropped 12.6% year to date. Alcon is set to report its third-quarter 2025 results on Nov. 12. Alcon currently has a Zacks Rank #2.

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