tapebrief
COO · Q2 2025

COO · Q1 2026 Earnings

Cautious

Cooper Companies (The)

Reported March 5, 2026

30-second summary

30-second take: Cooper delivered Q1 FY26 revenue of $1.024B (+6% YoY, +3% organic; +3.3% CVI organic per management) and non-GAAP EPS of $1.10 — six cents above the high end of the $1.02–$1.04 guide and the ninth straight earnings beat. Management raised FY26 EPS to $4.58–$4.66 (from $4.45–$4.60) and FY26 FCF to $600–$625M (from $575–$625M), but the underlying revenue algorithm is already under pressure: CVI organic of 3.3% sits ~120bps below the FY26 floor of 4.5%, and Asia-Pac declined 4% as Japan hydrogel softness hit unexpectedly in December–January. The strategic review was asked about by Travis Steed (BofA) but management declined to provide details, and it was addressed only in passing in prepared remarks.

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 FY2026 EPS guidance to $4.58–$4.66 (from $4.45–$4.60) and raised free cash flow guidance to $600–$625M (from $575–$625M) after Q1 beat on earnings, reflecting momentum from Q4 reorganization and strong segment performance.

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 - $0.08 above guideBeat
CooperVision RevenueQ1 FY2026$693 - $700 million$695.1 millionin-lineMet
CooperSurgical RevenueQ1 FY2026$327 - $330 million$329 millionin-lineMet

Changes to prior guidance

MetricPeriodPrior guideNew guideΔResult
Non-GAAP EPS
FY2026
$4.45 - $4.60$4.58 - $4.66raised by $0.03-$0.06 at midpointRaised
Revenue
FY2026
$4.299 - $4.338 billion$4.306 - $4.346 billionraised by $0.007-$0.008B at rangeRaised
CooperVision Revenue
FY2026
$2.900 - $2.925 billion$2.906 - $2.932 billionraised by $0.006-$0.007B at rangeRaised
Free Cash Flow
FY2026
$575 - $625 million$600 - $625 millionraised by $25M at low endRaised

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%
CooperVision - Toric and Multifocal$0.351B+10.0%
CooperVision - Sphere, Other$0.344B+5.0%
CooperSurgical - Office and Surgical$0.202B+2.0%
CooperSurgical - Fertility$0.127B+6.0%
CooperVision Organic Growth3%—
CooperSurgical Organic Growth2%—

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%—
Total Organic Revenue Growth3%—
Operating Cash Flow$260.9M—
Capital Expenditures$102.2M—
Share Repurchases (Q1)$92.5M—
FY2026 Free Cash Flow Guidance$600M-$625M—

Management tone

Q2 market growth reset → Q3 demand-conversion uncertainty → Q4 reorganization-funded reacceleration with strategic review on the table → Q1 EPS-and-cash story while organic growth disappoints.

The strategic review, which dominated Q4's narrative arc, drew only a passing acknowledgment this quarter. Last quarter management was "rolling up our sleeves… working with our advisors" on separation alternatives. This quarter, Al addressed it briefly in prepared remarks ("the review is progressing as planned with active engagement from our board and advisors"), and when Travis Steed (BofA) pressed on timing and outcomes in Q&A, management responded that there was "not much else I can add." Tone analysis flags "Strategic review process" as the most evasive topic of the call. Silence at Q1 is not yet disconfirming — Q4's guidance was for activity "into the year" — but the absence of any named workstream after one quarter is the first datapoint suggesting the review may be losing visibility.

Japan hydrogel softness is being framed as a discrete, time-bound issue — a framing Cooper has used before with mixed results. Management told RBC's John Block that Japan legacy hydrogel weakness "started in December and continued into January," with Asia-Pac expected to remain down in Q2 before "return[ing] to growth in Q3." This is the same shape as the Q2-Q3 FY25 China e-commerce narrative — discrete, transitional, recovering — that ultimately required two FY revenue cuts. The FY26 guide raise on EPS while CVI organic ran below the floor leans on this Q3-recovery assumption being correct.

Management is leading with margin and EPS, not growth — for the second straight time this happens, it has coincided with a CVI organic miss. "While revenues were lower than expected... strong margins, double-digit earnings growth, and robust free cash flow" was the Q3 FY25 framing the quarter Cooper cut FY revenue. This quarter's posture is structurally similar: an EPS beat of six cents, FCF raised, but CVI organic at 3.3% versus a 4.5–5.5% FY range. The Goldman exchange confirmed G&A savings are being reinvested into sales and marketing for MySite — a signal that growth investment is increasing precisely when growth is softest.

The "share gains restoration" story has narrowed to MyDay specifically, away from the broader CVI portfolio. "My Day Multifocal grew over 15%… MyDay Energist and Torex grew over 15%" and "Cooper taking wearers in both dailies and FRPs." The premium MyDay franchise is genuinely accelerating, but Sphere & Other at +5% reported (Clarity-heavy) and Asia-Pac at -4% mean the consolidated CVI organic number remains short of the FY guide. The mix engine works at the product level; it isn't yet visible in the consolidated print.

Q&A highlights

Jeff Johnson · Baird

Reconcile the reported 10% calendar Q4 growth versus the recent three quarters showing 3-3.5% organic growth for Cooper Vision. What explains the variance, and how is the company progressing on getting back to above-market growth relative to peers?

Management explained the 10% calendar Q4 was driven by timing of shipments (weak November-December 2024, strong January 2025). On above-market growth, management expressed confidence in Americas and EMEA momentum with MyDay and Clarity launches, but acknowledged Asia-Pac challenges, particularly in Japan with legacy hydrogel products. Expected Asia-Pac to remain down in Q2 but return to growth in Q3.

Calendar Q4 2025 growth: 10%Full calendar year 2025: 6% Cooper Vision growth vs 5% market growth18th consecutive year of market share gainsAmericas grew 6%, EMEA grew 4%, Asia-Pac declined 4%

Larry Bigglescombe · Wells Fargo

What is the company's exposure to the Middle East and how might the regional conflict impact fertility business? Additionally, how should margins be phased through the year given Q1 strength and the tariff outlook?

Middle East represents ~2% of consolidated sales but a more meaningful portion of fertility business where Cooper is number 1. Management noted product delivery challenges could impact fertility if situation extends, but still expects quarter-over-quarter improvement. On margins, strong Q1 driven by lighter Asia-Pac mix and synergies from reorganization; expects continued operational leverage but not providing quarterly gating.

Middle East: ~2% of consolidated salesTariff estimate: $24 million for full year (unchanged)Q1 operating margin: 26.9%Operating expenses: 41.2% of sales vs 43.6% prior year

Jason Bednar · Piper Sandler

How is Cooper performing in new fit activity versus peers across dailies and FRPs? What is management's outlook on future pricing increases given recent industry price stabilization?

Management indicated new fit activity remains strong with Cooper taking wearers in both dailies and FRPs. On pricing, management expressed optimism given strong product innovation pipeline (MyDay MySite, multifocals, Energist) providing justification for price increases. Noted pricing dynamics positive industry-wide except in some Asia-Pac markets where competition remains aggressive.

New fit activity: Cooper taking wearers in both dailies and FRPsPremium MyDay offerings (Multifocal, Energist, Torex): all growing over 15%Pricing environment: positive overall; estimated ~1% from price, ~1% from wears in market growthAsia-Pac: competitive pricing dynamics remain

John Block · RBC Capital Markets

Cooper Vision organic growth of 3.3% came in below guidance expectations. What deviated, and what were January 2025 trends? Also, explain the higher-than-typical add-backs related to legal matters.

Management attributed miss primarily to unexpected softness in Japan with legacy hydrogel products, starting in December and continuing into January. Explained that strength in contract execution and product launches would have resulted in ~4.3-4.4% growth absent Japan impact. On legal add-backs, noted $6.7 million in other legal-related matters; characterized as not atypical over time but higher than prior quarter.

Cooper Vision organic growth Q1: 3.3% (vs expected ~4.3-4.4%)Japan legacy hydrogel softness: unexpected headwind in Dec-JanLegal add-backs: $6.7 million in Q1Expected Asia-Pac down in Q2, then growth return in Q3

David Roman · Goldman Sachs

How are G&A savings from restructuring being reflected in the P&L, and where is management reinvesting those resources?

Management confirmed reinvesting G&A savings into sales and marketing, particularly on MySite initiatives. Emphasized that combination of leverage G&A and reinvestment into revenue-driving activities enabled delivery of earnings above expectations while maintaining operating margin improvement.

G&A reinvestment: primarily sales and marketingQ1 operating margin exceeded expectationsStrong focus on MyDay, MySite, and fertility launchesSavings funding both margin improvement and growth investment

Answers to last quarter's watch list

Q1 FY26 CVI organic landing inside the 3.5–4.5% guide — CVI Q1 organic came in at +3.3% (3% rounded in the press release), below the prior guide floor of +3.5%. Management's own counterfactual (4.3–4.4% absent Japan) would have just cleared the floor. The FY26 4.5–5.5% range is now meaningfully harder to hit and depends on a Q3 Asia-Pac recovery materialising.
Resolved negatively
Formal updates from the strategic review — Only a passing prepared-remarks line ("progressing as planned"), and Travis Steed's Q&A question drew a "not much else I can add." Q2 silence would be more damaging, but the lack of any incremental disclosure one quarter after announcing a "serious look" with advisors is the first negative tell.
Continue monitoring
FY26 FCF tracking against $575–$625M — Q1 FCF of $158.7M is a meaningful step-up from FY25 Q1's run rate and annualizes to ~$635M, above the raised midpoint of $612.5M. Management responded by raising the FY range low end by $25M. Cash conversion is the bright spot.
Resolved positively
MiSight FY26 growth ≥20% — MiSight grew 23% to $28M in Q1, tracking ahead of the ≥20% FY commitment.
Resolved positively
Gross margin trajectory under tariff pressure — Q1 non-GAAP gross margin of 68% was 200bps above the Q4 FY25 anchor of 66% and well above the 65% watch threshold. FY tariff estimate held at $24M.
Resolved positively
Fertility re-acceleration — CSI fertility grew +6% reported in Q1, a clear improvement from Q4's +1%. This puts the segment ahead of the trajectory required to hit the FY CSI 4–5% organic guide, though Middle East delivery risk was newly flagged.
Resolved positively

What to watch into next quarter

Q2 CVI organic recovery toward 4.5% — management guided Asia-Pac to remain down in Q2 before Q3 recovery. If Q2 CVI organic prints below 3.5%, the FY26 4.5–5.5% range requires an implausibly strong H2 and a guide cut becomes likely.

Any named workstream from the strategic review — silence at Q2 would be the second consecutive non-update after Q4's "rolling up our sleeves" framing. Look for either a separation announcement, advisor disclosure, or explicit deferral language. Continued silence is itself a signal.

Q2 Asia-Pac revenue trend, specifically Japan — management said legacy hydrogel softness started in December and Q3 brings recovery. A Q2 Asia-Pac print worse than Q1's -4% would call the recovery timing into question.

MiSight quarterly disclosure continuity — Q1 disclosed +23% to $28M; continued quarterly disclosure (or its absence) at Q2 will be the test of whether the franchise remains a featured KPI.

H1 FY26 FCF cumulative vs FY25 H1's $114M — Q1 of $158.7M already exceeds FY25 H1. Q2 FCF (which is seasonally weak — FY25 Q2 was just $18.1M) will determine whether the >30% H1 step-up actually materializes or whether Q1 borrowed from Q2.

Legal add-back recurrence — $6.7M this quarter was characterized as "not atypical over time" but elevated versus recent quarters. A second elevated quarter would suggest a structural reporting line rather than a one-off.

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 prepared remarks and Q&A commentary

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