Preliminary brief— based on press release only. Full analysis including management tone and Q&A will be added when the transcript is available.

BDX · Q1 2026 Earnings

Becton Dickinson

Reported February 9, 2026

30-second summary

SENTIMENT: Constructive Q1 revenue grew +1.6% YoY to $5.25B and adjusted EPS of $2.91 cleared the prior $2.75–$2.85 guide by $0.06 above the high end — both meaningfully better than the "down low single digits" Q1 frame management set in October. The headline is the FY26 recast: adjusted EPS guidance is now $12.35–$12.65 for New BD only, reflecting Waters life-sciences deconsolidation. Per management, the ~$2.40 reduction vs. the prior $14.75–$15.05 range is essentially fully attributable to the Waters separation and the deployment of the associated $4B cash distribution; underlying New BD EPS is operationally unchanged. The FY guide embeds a 370bps tariff drag on EPS growth (not on operating margin; Q1 tariff impact on adjusted gross margin was ~170bps), and the tax rate was raised to 16–17% from 14–15%. Operating margin reaffirmed at ~25%, revenue growth still framed "low single-digit" FXN with the FX tailwind nudged up to ~120bps from ~90bps.

Headline numbers

EPS

Q1 FY2026

$2.91

Revenue

Q1 FY2026

$5.25B

+1.6% YoY

Gross margin

Q1 FY2026

46.0%

Free cash flow

Q1 FY2026

$0.55B

Operating margin

Q1 FY2026

10.5%

Key financials

Q1 FY2026

Metric	Q1 FY2026	YoY	Q4 FY2025	QoQ
Revenue	$5.25B	+1.6%	$5.89B	-10.8%
EPS	$2.91	—	—	—
Gross margin	46.0%	—	—	—
Operating margin	10.5%	—	—	—
Free cash flow	$0.55B	—	—	—

Guidance

Material full-year EPS guidance cut (~15%) reflecting Waters separation and tariff headwinds, despite Q1 revenue beat; tax rate raised 100–200 bps; operating margin and revenue growth guidance reaffirmed at ~25% and low single-digit respectively.

Guidance is issued for the full year only, refreshed each quarter. Prior and new below are the same FY updated this quarter.

Actuals vs prior guidance

Metric	Period	Prior guide	Actual	Δ	Result
Adjusted Diluted EPS	Q1 FY2026	$2.75 to $2.85	$2.91	+$0.06–$0.16 above guide	Beat
Revenue Growth	Q1 FY2026	Down low single digits	+1.6% YoY	Reversed to positive, ~3–5 pts above prior low-single-digit decline expectation	Beat

New guidance

Metric	Period	Guide	YoY
Interest Expense, net	FY2026	$600 to $620 million	—
Weighted Average Shares Outstanding	FY2026	approximately 282 million shares	—
Adjusted Diluted EPS	Q2 FY2026	$2.72 to $2.82	—
Revenue Growth	Q2 FY2026	approximately 2%	—

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
Adjusted Diluted EPS	FY2026	$14.75 to $15.05	$12.35 to $12.65	–$2.15 to –$2.40 (–14.5% to –16.0% from prior midpoint)	Lowered
Adjusted Effective Tax Rate	FY2026	14% to 15%	16% to 17%	+100 to +200 basis points	Raised
Revenue Growth (FXN)	FY2026	Low single-digit growth expected	Low single-digit	Qualitatively narrowed; no change in stated range but substantive operational underperformance in context of Q1 miss and tariff headwinds	Lowered

Reaffirmed unchanged this quarter: Operating Margin (approximately 25%)

Segment KPIs

Q1 FY2026

Segment	Q1 FY2026	YoY
Medical Essentials	$1.595B	+0.6%
Connected Care	$1.131B	+5.5%
BioPharma Systems	$0.429B	+2.7%
BD Interventional	$1.33B	+5.8%
BD Life Sciences	$0.766B	-8.3%
New BD Revenue Growth (FXN)	2.5%	—
Connected Care Growth (FXN)	4.7%	—
Interventional Growth (FXN)	5.1%	—
Medical Essentials Growth (FXN)	-0.6%	—

Other KPIs

Q1 FY2026

Segment	Q1 FY2026	YoY
United States	$3.159B	+2.6%
International	$2.093B	+0.2%
Operating Cash Flow	$657M	—

Management tone

Q3 FY25: macro stabilizing → Q4 FY25: defensive guidance reset → Q1 FY26: execution confidence on "new BD" with embedded tariff/separation drag.

Last quarter management was in damage-control mode — the FY26 guide came in below expectations, organic FY25 missed the band, and the tone was "clearing the table." This quarter the posture is forward-deployed strategic ambition: the headline EPS range stepped down only because of the Waters deconsolidation recast, and operationally the New BD EPS is unchanged. The anchor: "This is an exciting moment for the new BD as we focus actions and raise our standards to out-compete, out-innovate, and out-deliver." With Waters closed today and the tariff impact embedded in the guide, management believes the "starting point" issue is behind them and execution on the New BD portfolio can carry the narrative.

Tariffs hardened from a quantified one-year headwind into a structural feature of the guide. Q4 FY25 framed tariffs as an ~$185M incremental hit absorbing a tier of EPS growth. This quarter the language is explicit: "adjusted EPS guidance for new BD in a range of $12.35 to $12.65 … including an impact of 370 basis points from tariffs" on EPS growth, with Q1 adjusted gross margin absorbing ~170bps of tariff impact directly. Reaffirming ~25% operating margin while embedding tariffs is the cleanest articulation yet that BD Excellence productivity is structurally offsetting tariffs — but it also concedes that without tariffs, margins would have stepped up rather than held flat.

Commercial excellence moved from announcement to org change. Last quarter management announced a new CRO role and "re-architecting" of the commercial operating model. This quarter Mike Feld is in the seat full-time, and the framing escalated to early validation — Pyxis Pro launch with 85% competitive conversions, Alaris with ~100bps category share gain in the quarter, and broad-based competitive wins across Medical Essentials, BioPharma, and BDI. The shift from "we need to do this" to "we are doing this and seeing results" is meaningful — Q1's revenue beat reads as early validation of the commercial reset.

BD Excellence expanded from operations into R&D as a measurable lever. New this quarter: "We've seen a number of R&D projects where we've accelerated timelines to launch by six and even up to 12 months" via Kaizen methodology applied to innovation. Prior quarters discussed BD Excellence almost exclusively as an operations/productivity program. The expansion into R&D timelines is a tangible new lever and signals management is trying to broaden the "structural acceleration" story beyond cost-out.

The flat quarterly cadence claim is a notable de-risking commitment. Q1 ran at full-year run rate, Q2 guided to +2% (consistent with FY), and "no ramp in the year" was emphasized — including no first-half-to-second-half ramp. Last quarter's FY25 setup carried back-half ramp risk that ultimately delivered a narrow organic miss; this year management has explicitly removed that variable, which means a Q2 miss would force a full FY reset rather than a "back-half catch-up" defense.

Recurring themes management leaned on this quarter:

Pure-play med tech positioning post-Waters separationMid-single-digit growth driven by high-margin platforms (90% of portfolio)Commercial excellence as untapped value lever alongside operational excellencePortfolio reshaping complete with tuck-in M&A disciplineTariff headwind offset by BD Excellence productivity and favorable mixInnovation pipeline acceleration through Kaizen methodology

Risks management surfaced:

China VBP (volume-based procurement) expected 80% portfolio penetration by end of FY26Vaccine product headwinds continuing through FY26, abating in FY27Alaris competitive remediation tail creating 200 basis point headwind in FY27Tariff impact of 370 basis points to EPS growth in FY26Persistent customer pricing pressure requiring value articulation

Answers to last quarter's watch list

Q1 FY2026 revenue actual vs "down low single digits" guide — Q1 revenue grew +1.6% YoY, a material positive surprise vs. the guided low-single-digit decline. New BD FXN growth of +2.5% confirms the underlying portfolio is performing better than the "concentrated headwinds" math implied. Status: Resolved positively

Vaccine FY2026 decline holding at ~25% — vaccines were not separately quantified, but management stated vaccines were "relatively in line with expectations" in Q1, with biologics (including double-digit GLP-1 growth) offsetting within BioPharma Systems (+1.0% FXN). The ~25% decline assumption appears intact directionally. Status: Continue monitoring

Waters transaction close and $4B buyback execution pace — transaction closed on February 9, 2026, nearly two months ahead of schedule. Capital deployment is explicit: $2B via ASR (share repurchases) and $2B to debt paydown, both expected to be executed in the near term. FY26 weighted average shares set at ~282M. Status: Resolved

FY2026 tariff impact holding at incremental $185M — tariffs reframed as 370bps drag on FY EPS growth (consistent in magnitude with the prior ~$185M figure), with Q1 absorbing ~170bps on adjusted gross margin. Management reaffirmed ~25% operating margin inclusive of this drag. No incremental escalation called out. Status: Resolved — held

Whether the ~90% of portfolio actually grows mid-single digits — Interventional +5.1% FXN, Connected Care +4.7% FXN, BioPharma +1.0% FXN — Interventional and Connected Care squarely in mid-single-digit territory; BioPharma masked by vaccine drag with biologics growing double digits underneath. Management reiterated the 90%/10% framing in Q&A. Status: Resolved positively

What to watch into next quarter

Q2 adjusted EPS vs. $2.72–$2.82 guide — with no ramp baked into the year, Q2 is the cleanest test of the operating run-rate. A miss would invalidate the "Q1 at full-year run rate" framing and force a second FY cut.

FY26 EPS bridge clarity for New BD — management asserted the $2.40 step-down is essentially fully the Waters carve-out + $4B cash deployment, with operations unchanged. Watch for explicit walk in the Q2 deck confirming this; any operational drift would undercut the "operationally unchanged" claim.

Operating margin progression from Q1's 21.2% toward the FY ~25% guide — Q1 adjusted operating margin came in ~380bps below the FY target, broadly consistent with management's "no ramp" framing given Q1 seasonality and tariff timing. Watch for steady stepping toward ~25% over Q2–Q4; deviation in either direction would test the FY commitment.

Commercial excellence revenue uplift — if Mike Feld's CRO appointment is materially additive, the New BD FXN growth rate of +2.5% should accelerate by Q3. Watch whether management quantifies any commercial-driven contribution.

Tax rate at 16–17% holding — the +200bps tax-rate increase is a structural post-separation feature, not a transient adjustment. Any further increase would compound EPS pressure.

$2B ASR pace and debt paydown execution — both flagged as "near-term." Watch for completion timing and impact on FY share count assumption (~282M).

Sources

BDX Q1 FY2026 press release (filed 2026-02-09): https://www.sec.gov/Archives/edgar/data/10795/000162828026006182/ex99112312025.htm
BDX Q1 FY2026 earnings call prepared remarks and Q&A (February 9, 2026).

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