tapebrief
COO · Q4 2025
COO · Q2 2026

COO · Q1 2026 Earnings

Cautious

Cooper Companies (The)

Reported March 5, 2026

30-second summary

30-second take: Cooper printed Q1 revenue of $1.024B (in-line with the $1.019–$1.030B guide) and non-GAAP EPS of $1.10 — $0.06 above the $1.02–$1.04 guide — and used the beat to raise FY26 EPS to $4.58–$4.66 (from $4.45–$4.60), FY26 FCF to $600–625M (from $575–625M), and nudge FY26 revenue up $7M at the midpoint. The catch: CVI organic landed at +3%, below the +3.5–4.5% Q1 guide, on a year management has explicitly framed as back-half-loaded — meaning the FY +4.5–5.5% CVI algorithm now needs every subsequent quarter to print at or above plan. The EPS beat is real and margin-driven; the growth story took another small hit.

Headline numbers

EPS

Q1 FY2026

$1.10

Revenue

Q1 FY2026

$1.02B

+6.0% YoY

Gross margin

Q1 FY2026

68.0%

Free cash flow

Q1 FY2026

$0.16B

Operating margin

Q1 FY2026

21.0%

Key financials

Q1 FY2026
MetricQ1 FY2026YoYQ4 FY2025QoQ
Revenue$1.02B+6.0%$1.07B-3.9%
EPS$1.10—$1.15-4.3%
Gross margin68.0%—61.0%+700bps
Operating margin21.0%—13.0%+800bps
Free cash flow$0.16B—$0.15B+5.9%

Guidance

Cooper Companies raised full-year 2026 EPS, revenue, and free cash flow guidance following a strong Q1 beat on earnings, with Q1 revenue meeting expectations and organic growth slightly missing prior guidance.

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

MetricPeriodPrior guideActualΔResult
RevenueQ1 FY2026$1.019 - $1.030 billion$1.024 billionin-lineMet
Non-GAAP EPSQ1 FY2026$1.02 - $1.04$1.10+$0.06 above guideBeat
CooperVision Organic GrowthQ1 FY20263.5% to 4.5%3%-0.5 to -1.5pts below guideMissed
CooperSurgical Organic GrowthQ1 FY20262% to 3%2%-1pt below guideMissed

Changes to prior guidance

MetricPeriodPrior guideNew guideΔResult
Non-GAAP EPS
FY 2026
$4.45 - $4.60$4.58 - $4.66+$0.08 at midpointRaised
Revenue
FY 2026
$4.299 - $4.338 billion$4.306 - $4.346 billion+$0.007B at midpointRaised
Free Cash Flow
FY 2026
$575 - $625 million$600 - $625 million+$25M at low endRaised
CooperVision Revenue
FY 2026
$2.900 - $2.925 billion$2.906 - $2.932 billion+$0.006B at midpointRaised

Reaffirmed unchanged this quarter: CooperSurgical Revenue ($1.400 - $1.413 billion)

Segment KPIs

Q1 FY2026
SegmentQ1 FY2026YoY
CooperVision$0.695B+8.0%
CooperSurgical$0.329B+3.0%
CVI - Toric and Multifocal$0.351B+10.0%
CVI - Sphere, Other$0.344B+5.0%
CSI - Office and Surgical$0.202B+2.0%
CSI - Fertility$0.127B+6.0%

Other KPIs

Q1 FY2026
SegmentQ1 FY2026YoY
Americas$0.289B+7.0%
EMEA$0.282B+15.0%
Asia Pacific$0.124B-4.0%
Non-GAAP Operating Margin27%—
Non-GAAP Gross Margin68%—
Organic Revenue Growth3%—
CooperVision Organic Growth3%—
CooperSurgical Organic Growth2%—
Free Cash Flow$158.7 million—
Operating Cash Flow$260.9 million—
Share Repurchases$92.5 million (1.1M shares)—

Management tone

Q1 capacity-constrained → Q2 market growth reset → Q3 demand-conversion uncertainty → Q4 strategic review and reorganisation → Q1 FY26 margin-and-cash victory lap.

Transcript prepared remarks were not available for this brief — tone analysis below relies on press-release language and the Q&A excerpts captured separately.

Management is leading with margin and cash for the second consecutive quarter, and the FY26 raise is constructed from those two levers, not from growth. Last quarter's pitch was "$50M reorganisation savings + back-half-loaded growth = double-digit EPS"; this quarter management cashes the savings cheque early — non-GAAP operating margin 27%, gross margin 68%, opex down 240bps YoY — and uses the proof point to raise EPS $0.095 at the midpoint while raising the FY revenue midpoint by just $7M (~0.2%). The press release quote: "highlighted by product launches, outstanding profitability, and robust cash flow, all of which gives us the confidence to raise both earnings and free cash flow guidance" — note the absence of "revenue" from that sentence.

The Asia-Pacific "lapped drag" thesis from Q4 has not yet materialised. Last quarter management committed publicly: "we're not going to see the same detriment in 26 that we saw in 25." Q1 Asia-Pac reported revenue declined 4% YoY — worse than Q4's -1% — with Japan-specific legacy hydrogel pressure flagged in Q&A as the culprit. Management deferred recovery to Q3 ("expects recovery in Q3 once new launches and private label contracts ramp"). This is the second consecutive quarter where the Asia-Pac inflection is "next quarter."

The MyDay private-label and back-half-loaded narrative is now load-bearing. With Q1 CVI organic at +3% against a +3.5–4.5% guide, every subsequent quarter has to print above the FY +4.5–5.5% range to keep the algorithm intact. Management didn't flinch — the CVI FY organic guide was reaffirmed at +4.5–5.5% — but the room for any further Asia-Pac slip or MyDay timing delay just shrank meaningfully.

The strategic review went unmentioned in the Q&A as a substantive topic. Q4 framing made the formal review the headline event; Q1 Q&A captured "Strategic review" as the most evasive topic per the analyst tracker. No advisor identification, no scope clarification, no timeline. For a process management committed to update on this call, the silence is the disclosure.

Pricing power was reframed back to positive after Q3's capitulation. In Q3 management walked global pricing down from +2–3% to ~+1%. This quarter (per Q&A): "pricing environment is positive industrywide; management believes market can absorb multiple price increases per year given innovative product launches." That's a meaningful narrative reversal in two quarters — worth watching whether it shows up in Q2 organic mix.

Q&A highlights

Jeff Johnson · Baird

Reconcile the reported 10% calendar Q4 growth versus the ~3-3.5% organic growth in recent quarters. Then, how is the plan progressing to return to above-market growth given competitive positioning?

Al explained the 10% calendar Q4 was driven by weak November-December 2024 and strong January 2025 shipment timing. On market share gains: Americas and EMEA show good momentum with MyDay and Clarity transitions progressing well. Asia-Pac remains the challenge, specifically Japan with legacy hydrogel pressure, but management expects recovery in Q3 once new launches and private label contracts ramp.

10% calendar Q4 growth driven by shipment timing, not underlying demand acceleration18th consecutive year of market share gains in calendar 2025Americas grew 6%, EMEA grew 4%, Asia-Pac declined 4% in Q1Management confident Asia-Pac returns to growth in Q3

Larry Bigglescombe · Wells Fargo

What is Cooper's exposure to the Middle East and how might conflict impact fertility business? Also, how should margins be phased for the year, and what is the tariff exposure if the Supreme Court ruling stands?

Middle East represents ~2% of consolidated sales, mostly distributor-based, with fertility being the main exposure. Despite Middle East uncertainty, fertility momentum expected to improve quarterly. On margins: strong Q1 driven by synergies and reorganization savings. Tariff estimate remains $24M for the year; a 10% to 15% tariff would add ~$4M impact. Management expects continued margin expansion as synergies realize.

Middle East ~2% of consolidated salesFertility market stabilizing after 2024 weaknessQ1 gross margin 68.1%, exceeding expectationsOperating expenses declined from 43.6% to 41.2% of sales YoY

Jason Bednar · Piper Sandler

Update on competitive landscape and new fit activity. How is pricing environment evolving, and can the market absorb more than one price increase per year?

New fit activity continues to favor Cooper in both dailies and FRP segments. Pricing environment is positive industrywide; management believes market can absorb multiple price increases per year given innovative product launches (MyDay MySite, multifocals, Energist). Caveat: Asia-Pac still has competitive pricing pressure, particularly in legacy segments.

Cooper taking wearers in both dailies and FRP new fit activityPricing environment described as positive and stableMarket can support multiple price increases annually due to innovationContact lenses not expensive relative to perceived value

Robbie Marcus · JP Morgan

How conservative is the guidance given Q1 miss and expected Q2 softness in Asia-Pac? Did management include ParaGuard competitive threat in original guidance?

Al characterized conservatism as neutral: Q1 miss in Asia-Pac offset by upside in Americas and EMEA versus December expectations. ParaGuard competitive launch was included in original guidance as a negative impact, but deal has not closed, so actual impact may be better than assumed. Overall, management maintains confidence in back-half execution.

Americas and EMEA stronger than December expectationsAsia-Pac in line with December expectations despite Q1 weaknessParaGuard competitive threat factored into original guidance as negativeDeal closure uncertain; competitive launch timing pushed into next year

David Roman · Goldman Sachs

How much G&A savings are being realized from last year's restructuring, and where are those savings being redeployed?

G&A savings are being reinvested primarily into sales and marketing, particularly for MySite and product launches. Management achieved operating expense growth of essentially flat YoY despite higher revenue and increased S&M spend, demonstrating significant leverage. Reinvestment strategy allows margin expansion while funding growth initiatives.

G&A savings redeployed into sales and marketing spendOperating expenses essentially flat YoY despite revenue growthMySite receiving significant increased marketing investmentMargin expansion achieved while reinvesting productivity gains

Answers to last quarter's watch list

Strategic review milestones. No advisor identification, no scope confirmation, no interim board commentary in the release or Q&A coverage. The Q&A tracker flagged "Strategic review" as the most evasive topic of the call. Cooper committed to an update on this call and effectively didn't deliver one.
Continue monitoring
Q1 FY26 CVI organic inside the +3.5–4.5% guide. Q1 CVI organic landed at +3% — 50–150bps below the guide on the first quarter of an explicitly back-half-loaded year. FY CVI organic guide was reaffirmed at +4.5–5.5%, meaning the remaining nine months must average above the FY range to hold.
Resolved negatively
Fertility re-acceleration evidence. CSI fertility reported +6% in Q1, a clear lift from Q4's +1%, with management framing fertility momentum as expected to improve quarterly despite Middle East uncertainty. Organic was not separately disclosed, but the reported step-up is the first concrete evidence behind the mid-single-digit FY framing.
Resolved positively
Reorganisation savings phasing. Q1 non-GAAP operating margin hit 27% (+~110bps from prior trend) and opex fell from 43.6% to 41.2% of sales — clear evidence the ~$50M savings are landing in the P&L early. Per Q&A, G&A savings are being partly redeployed into S&M (MySite), so not all of it drops to EPS — though the FY EPS raise of +$0.095 at the midpoint suggests roughly half is sticking.
Resolved positively
Capital allocation execution against the new framework. Q1 repurchases were $92.5M (1.1M shares) — well below the Q4 pace of $197.3M and below a two-thirds-of-FCF rule applied to Q1 FCF of $158.7M (which would imply ~$105M). The shortfall is modest, but the Q1 pace is lighter than the framework would suggest.
Continue monitoring

What to watch into next quarter

Q2 FY26 CVI organic landing above +4.5% — with Q1 at +3% and the FY +4.5–5.5% guide reaffirmed, Q2 needs to start the back-half ramp. A print below +4% on the +4.5–5.5% trajectory would force a CVI guide cut and crack the FY EPS bridge.

Asia-Pacific returning to flat-or-better organic — management has now twice deferred the inflection to "next quarter." A third consecutive negative Asia-Pac print would invalidate the lapped-drag thesis and the FY CVI algorithm with it.

Strategic review disclosure — formal reviews typically run 6–12 months; the Q4 announcement was December 2025. By Q2 (May–June reporting), an absence of advisor names, scope detail, or any board update would suggest the process has stalled or pivoted to no-action.

ParaGuard competitive launch timing — management confirmed the competing product's deal has not closed; original FY26 guidance assumed the launch as a Q2 headwind. If the launch slips into FY27, that's an unbaked ~$10–15M upside source to monitor for explicit quantification.

Buyback pace — Q1 at $92.5M was below the two-thirds-of-FCF framework run-rate. Watch whether Q2 repurchases step up toward the ~$100–110M quarterly pace implied by the raised $600–625M FY FCF guide, or whether Cooper is conserving cash ahead of a strategic-review outcome.

Sources

  1. Cooper Companies Q1 FY2026 press release, filed 2026-03-05: https://www.sec.gov/Archives/edgar/data/711404/000162828026015231/cooperq12026pressrelease.htm
  2. Cooper Companies Q1 FY2026 earnings call Q&A (transcript prepared remarks not available)

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