BRKR - Earnings call transcript Q3 2024

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and welcome to the Bruker Corporation Third Quarter 2024 Earnings Call. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Joe Kostka, Director of Investor Relations. Please go ahead.

Joe Kostka

Good morning. welcome Call. Bruker to XXXX Third like Conference Earnings would everyone Corporation's to Quarter I is Kostka, name Relations. My Joe Bruker Director Investor of and I'm the

me our Frank Gerald Joining our call CEO; Herman, CFO. and and Laukien, and EVP today's on President are

release earnings Bruker's referencing today's Events be issued earlier slide and from Investor the presentation that Presentations the conference to today, we of call, Relations addition website. we In downloaded section will a during can be

information. are Reconciliations will financial ir.bruker.com. we today's our financial to in highlighting During website our be GAAP of non-GAAP measures our call, non-GAAP earnings posted at included are release and on

Before we Slide harbor on X safe begin, of the Bruker's I like reference presentation. which shown to statement, is would

statements include, updated filings, of events operational market release on chains. those geopolitical During actual financial and the demand company ending might the to, the today's website in statements. related regarding Factors acquisitions, Form discussed those other our website. supply and future from such such and SEC's this we to earnings make conference call, available uncertainties. performance and risks, or involve will limited results materially that risks not or but in recent XXXX, Including as XX, for may differ cause company's our the are December XX-K which our period on are by SEC and that our forward-looking differences The may and

forward-looking prior quarter the today, and be for not X, XXXX. that results other do in statements XXXX our note release early XXXX. information Also, required please our events of of to business based the following November future based update by intend except to reasons, current information, fourth is outlook or as as new on expected conditions February We financial our may to law, on

statements You date any views representing after outlook today. should these rely our necessarily on as not as forward-looking or of

business in of progress. fiscal financial of Gerald Frank, the share with and months updated the and financials outlook. an detail for quarter will today's begin third XXXX will cover more providing XXXX X We then our year overview our call first the

to the Frank CEO, Bruker's Now call over turn Laukien. I'd like to

Frank Laukien

Thank you, rapidly, today's or and continues us growth again we CER Joe. above-market have joining quarter revenue you on Bruker and third thank call. posted everyone, to double-digit for revenue XXXX earnings rate morning, year-to-date. and constant Good and grow organic in QX once exchange year-over-year

year-over-year, that Our XX.X% in including the QX closed revenue acquisitions have 'XX CER growth year. earlier was strategic several

Our typically strong peers market Instruments which of 'XX and revenue QX on 'XX year-over-year our growth market the organic obviously year-over-year life were and prior of high X.X% in these comparison organic revenue science or Scientific growth of tools BSI QX. faced Bruker of the tougher segment, organic than above in top X.X% or come what at year made of XX.X% our a for QX growth end

was operational margin excellence recent digitization. we improvements that, and a also improvements our With testament to acquisitions, strategic and secular including now fast our single-cell molecular biology, management all have already further importantly, biology, improvements in process Accelerate growth delivered QX acquisitions performance programs sequential diagnostics lab industry. with automation in we in transformation is rapid powerful in are exposure spatial QX. which Equally our expect quarter into and and This sequential increased first many trends most Project operating full our to company of the in our Bruker multiyear driving a

single-digit in revenues organic revenue low an organically fourth quarter of this growth quarter, comparison we QX exceptional XX.X% to grew 'XX when In expect Bruker year-over-year.

encouraging growth multiomics, expect half double-digit year-over-year upper China, genomic, year, improving tools and transformational tech differentiated, and demand in second in XXXX. We revenue in fourth rate sustained orders bookings QX organic growth. from both the benefiting but and for fundamentally semicon not Bruker comps So of organic us revenue despite mid-single-digit to easy declines we It BSI the in again due our continues of last biopharma gradually constant is quarter solutions are that are with clean year-over-year. growth in recoveries infectious delayed for disease diagnostic exchange

it second businesses in our XXXX. been recoveries P&L to there a benefit is fiscal supplemented growth will of systems in CRO stimulus And revenue good further has will transformation. benefit Integrating recently anymore. that and lag the our and This we will emerging XXXX making to biotech anticipate fourth biopharma, accelerate improving between and become year, our X-quarter also Bruker's [ quarter our in for begin demand orders year evident has could first significantly order year not back, accordingly, stimulus trend acquired BSI Stepping half strongest in China XXXX. a lowering recall this organic that fiscal over orders is are guidance. and for our we XXXX typically of the that NASS the Bruker, remarkable continue, ] progress and China order China and Please by

our in drive organic and significant revenue XXXX in above-market with ability beyond. confident are We growth to margin expansion

which CER eliminations. X.X% of Revenue intercompany organic in added X.X%. to now, Bruker's from revenues increased organic year-over-year. QX exchange included and of million, constant at growth On which an growth Slide XX.X%, X 'XX $XXX.X to turn decline acquisitions a reported included XX.X% currency rate which XX.X% BEST a implies X.X% year-over-year you X.X%, net growth organic tailwind revenues If increased BSI of or basis,

acquisitions, and to close QX and even XX.X%, QX QX result recent Gerald basis, will 'XX key QX the bps non-GAAP later reported for was $X.XX in diluted XXX XXX diluted in dilutive, reported revenues Our 'XX. scale of markets of EPS margins On are to EPS broker about to down have Bruker added of $X.XX enter or importantly, 'XX. drivers our us more compared non-GAAP EPS a strategic next largely but our from margin the allowed discuss the up of but for In growth was margin GAAP year-over-year initially of decrease in and in $XXX million EPS have accelerate more to $X.XX, in 'XX sequentially, presence decade. detail. which 'XX, operating a of bps $X.XX QX XX%

Slide LSC of EPS you with can to performance market down the XX.X% organic revenue months expected was ] non-GAAP to [ see above Bruker's of XXXX while X for Moving due acquisitions. first X, growth as our transformative X%,

constant As of revenues months revenue first reported, to by increased growth XXXX X with our XX.X% rate, year-to-date. billion $X.XX XX.X% exchange of

First at intercompany of BEST, X revenue organic organic X.X% growth organic and eliminations. of X.X% consisted months net growth instruments in scientific growth

and biopharma us the we half which We expect China and and continue in beyond. to benefit await work to down our markets, the backlog second in recoveries XXXX elevated of

non-GAAP from our XXXX first turn highlight the year-to-date a our instruments of and and markets and us revenue third in EPS BioSpin research business. software was the months are Our BioSpin systems basis. of performance high well the X on Bruker in In all $XXX X our X Slide and of class 'XX, million X. Please group and China as currency GAAP XXXX, performance of year-over-year were services margin our margin operating Slide new grew revenue and They outside XXXX and first months and all across where as government X industrial Year-to-date, to constant quarter automation bringing year-to-date. X and X group summarized to gigahertz non-GAAP on of X we teens saw growth gross segment, now, strong academic, scientific QX contributions BEST in NMR percentage.

in in group and CALID orders growing Bruker the BioSpin beginning slower well of for low MALDI the but biopharma CALID performance ELITech infectious Diagnostics weaker disease $XXX year-to-date, business, as franchise the strong growth revenue in fourth into was in acquired IR/NIR/Raman markets. optics, in and offset diagnostics well revenue Biotyper our by growth 'XX had microbiology double as, partially Molecular has bookings has China the the in recently million expectations 'XX. seen business. of CER China growth with in increased stimulus and as as applied biopharma and by quarter of course, percentage in driven the digit Year-to-date,

industrial Bruker Year-to-date, was million, to strong by revenue the Nano the in with and bolstered aca/gov, $XXX percentage and metrology megatrend. X CER turn mid-teens revenue research growth grew revenue Please Slide in AI now. semiconductor

Cellular Bruker's growth. contributed inorganic NanoString acquired and recently Our businesses Analysis

of by biopharma in weakness life sciences continue and businesses those instrumentation. impacted both to be However,

This BEST XXXX ROI, instruments, and grew weak for technologies research revenues in was in EUV and of OEM by offset growth our demand single softness driven eliminations medtech of year-to-date clinical superconductor intercompany from customers. the research CER lithography China semiconductor MRI Finally, of technology partially low fusion digits in as accelerator interaction net also in support well by tools as AI. growth

we give We tech Slide solutions talk businesses a I'll comment on X, various and problems. couple than see and research broad examples like rather at and industrial its or of battery you often, for set X very insertions case technologies Slide examples. always the of and studies X just listed tools to and couple of On look really, rather about Bruker the and On approached really X, clean businesses. a strategically really offer We're of this or X have this value broadly approaching that very or X chain. across X or the technologies and bottom

and said clean So as strategic applied particularly been has really research others, isn't growth clean this are a before, tech, nice approach example broad very but industrial There general, example. for of in a growth X this and cyclical our in just really element. which, is good is very we've and steady tech,

on Slide X. Something else

sensitive with in highest in systems, we the business performance. with this very performance, that in be time launched a think the instruments so-called Sierra a we throughput Triceratops, high You earlier market-leading familiar that but sensitivity, we high for some may SPR is SPR been its our very instruments had year,

and the play over screening. market think give for years the So last very us was in and or I molecule will small a large strong this X molecule X traditional developed organically, SPR

SPR us New deeply useful won't molecular innovative targeted or is fact, detail, and for addition. and bind dynamics, shown degraders X somewhat were, a technology to glues other, the at in here. degraders looking molecule but Munich molecules quarter like, during latest glues. I important the that quite novel is in has which in the joined molecular that company actually is provided switches switchSENSE, third protein somewhat the in middle unique That's protein technology to trends field has go and each it different in X into for dynamicBIOSENSORS but an particular, of capability

disease finally, perhaps interaction is of part molecules And can up most is at research, dynamicBIOSENSORS really and unique. revolutionary cells, the for that targeted the single this And pretty the we gene molecules between tremendously and the exciting cell doing and level open acquisition therapies. for cytometry, -- important single and cell research obviously interactions not field therapeutics, fundamental and and of but this other cell

and up interaction cytometry, you'll before, field the be opening heliXCyto but pioneering So of it our haven't here heard is hearing something again. you single-cell

moving Anyway, above call. the growth posted organic back revenue to Bruker tools market rest CER In life science summary, and of BSI earnings QX the year-to-date. in and double-digit growth again

we Accordingly, growth of X%. as demand XXXX. not first expect However, XX% approximately recoveries our year and immune of organic delayed adjusting Gerald the we the revenue more and will are biopharma full to for growth XXXX X detail, to X% we see during are the and of guidance, in now revenue China months year in explain our

We and our innovative providing era. recently the in businesses on improvements solutions high-value continue driving and to for focus acquired post-genomic on our core

growth our and growth, single to come. our XXXX expansion that further in and the significant expansion having expect and to diagnostics will in spatial, cell years molecular We lab strategic above-market contribute into profitable automation margin

with in turn outlook updated CFO, our to me more Bruker's detail. will Gerald So over performance financial let Gerald? call review the and that, who

Gerald Herman

which XX.X% revenue million, increased an prior X.X% reflects growth for organic performance. This us everyone, to Bruker's year a Bruker's provide third to quarter is compared to of I'm organic pleased XXXX increase Thank you, reported and revenue you, Starting comp. 'XX, quarter with XX. Frank, joining all more In approximately third BSI year-over-year. on of of X.X% financial strong thank Slide today. year-to-date $XXX detail very and the and

of in XXXX to year-over-year quarter investments reminder, XX.X% genomic from non-GAAP As basis growth points XX.X%. and our acquisitions operating strategic of expected in dilution solutions. organic third R&D a margin XXX tools a result was 'XX decreased post our QX as and the our significant

resulting on M&A-related in we was the of of 'XX. third posted partially of We $XX.X investments year-over-year share, a reported XX.X% quarter cash $XX.X XXXX. third down third $XX and income $XX.X from in of third million $X.XX were $X.XX quarter about $X.XX GAAP million capital. of quarter compared in flow share working cash EPS On to in of million XXXX $X.X improvements a QX free basis, the quarter We EPS XXXX lower GAAP the significant XXXX. in in per by offset decrease compared third the non-GAAP million generated of $X.XX per of operating Capital flow in the 'XX, to net quarter million, expenditure expenses, of the

Magnetic range, driven by In system the Resonance shows third for 'XX. X Bruker NMR XXXX, organic low XX the has class reviewed Frank in to to quarter up quarter the bridge of third quarter we the strength quarter the in in XXXX, X compared revenue of systems gigahertz Services of 'XX Slide BioSpin's gigahertz our and recognized third the was third double-digit earlier. businesses. of in revenue 'XX, third class percentage Compared as revenue quarter

mass Talent offset strength low percentage as in the biopharma. in revenue strong [ semiconductor MALDI in growth partially by systems the more in softness and from growth delivered third mid-single applied spectrometry and rate digit and Biotyper strong Bruker organic up performance aftermarket. in revenue digits exchange with than Systems businesses advanced Nano offset constant businesses, organic CER in revenue We by softness was with aftermarket digits BSI percentage of microscopy. in X-ray our ] growth fluorescence declined single and XXXX was solid double-digit mid-single quarter

organic on low Americas in of XXXX, third revenue percentage. an grew our the basis in and single Geographically quarter digits the

China, percentage China double percentage and Asia Pacific low declining European was year-over-year. revenue, excluding double-digit up declining with low revenue single-digit all digits

mid-teens EMEA was our up XXXX revenue year-over-year. For percentage QX region,

dilution XXXX recent QX non-GAAP strategic decreased of XX.X% a from in our basis XX.X% the Non-GAAP on 'XX product XX a of mix and acquisitions. third basis. performance temporary points shows quarter from margin unfavorable P&L gross Slide to XXX our due expect

the of For an basis our and was end XXX points shares of rate increase Weighted mix the approximately quarter outstanding of of third due in an quarter of shares item the quarter quarter 'XX average in equity XXX million non-GAAP completed discrete the third to million, XXXX, result a of diluted 'XX. jurisdictional offering up as effective third XXXX the unfavorable X.X follow-on were our at May. tax from third

non-GAAP of third $X.XX XX.X% to temporary was Finally, expected compared quarter to the due down our of acquisitions. third quarter the XXXX dilution and EPS strategic primarily from XXXX,

X XX.X%, XXXX. slight X.X%. line, the XX year-over-year revenue largely X.X% P&L Slide explained drivers reflecting on already as 'XX third Slide XXXX. for X.X% the the X exchange Reported for the months to XX XXXX contributed of months and shows first on the X months foreign was growth similar bridge of of revenue organic headwind. of top summarized while Non-GAAP the the drivers first a results covered for Frank slide. with to of up Acquisitions the first was quarter are our

profitability X down and the advances and taxes first other we the of Turning XXXX, the to and lower to months XXXX, In of compared million Slide of expenses, XX. by first cash generated operating flow, X $XX.X acquisition principally items. restructuring months million $XX.X driven of timing

in cash the quarter, to the most of the see and profitable We fourth year. improved largest quarter flow expect

XX. Turning now to Slide

in and XXXX. markets As noted guidance. expect by to we no previously accordingly, to recoveries Frank, our we're And moving our longer year biopharma down fiscal China XXXX benefit year fiscal see

range be be in acquisitions to XX.X%. revenue. of for updated X% Our X% revenue leads approximately of $X.XX guidance XXXX outlook assumes foreign to organic XXXX We now growth year to of exchange in $X.XX contribution XXXX. revenue and from growth for fiscal to fiscal revenues to year reported XX.X% billion the now billion expect to range for and to This neutral X.X% the fiscal year-over-year year the

margin year points XXX XXXX a operating than we For XXXX, with basis from operating now approximately XX%, greater expect the acquisitions. margins strategic headwind fiscal our of in

strategic down line, On assumptions the from range we're top the guidance $X.XX, acquisitions. slide. on our result to headwind range of a $X.XX, bottom from to $X.XX XXXX now year transition of our EPS non-GAAP expectation Other line guiding a of and prior are fiscal $X.XX listed to lower

of Our have foreign for XXXX. updated currency year XXXX ranges rates September fiscal been XX, as

the and backdrop quarter in organic X now XXXX, in to to the fourth single the improvements class revenue To XXXX quarter growth be and included of of low we the in add organic biopharma approximately of against fourth delayed gigahertz of expectations, XXXX the NMR a anticipate as XX% color with quarter China comp, fourth growth which in digits.

improvement. 'XX Frank year-over-year margin As earlier, also and sequential double-digit operating rate we again mentioned exchange fourth quarter post-acquisition constant of expect growth the in revenue further

up, organic above-market wrap in delivered of quarter revenue To the growth Bruker third XXXX.

saw full that our February. innovative We to for on and improving. look to signs our update an results gradually also fourth you providing We solutions next is forward demand year quarter

I'd over And of call call. begin to that, much. the very portion now like the to turn with you Q&A to the Thank operator the

Operator

Partners. from [Operator comes question Puneet Instructions] Souda our from first And Leerink

Puneet Souda

So versus biopharma But help you much materialize? quarter the how won't but that saw that guide end mid-single-digit the into pushout about 'XX of you cut there you the And first out first that of won't to maybe the of you the one, talked of cancellations due pointed orders simply in is and backlog? China any orders in wondering in if BSI, bookings high XXXX.

Frank Laukien

-- Okay, aware never cancellations. to material Puneet. of have cancellations. I'm any we -- we not any have no seem material have No, had

biotech after biotech for So for that's being to improving somewhat Yes, the after us. not an funding. issue raise seemingly biopharma and in ability maybe

cost-cutting, has bit, program see down that We restructuring biopharma. little think site a I lot of slowed a consolidation.

shoots, green really from in get are biopharma half it by bit yet. recovery be of second a lift call to still There I this would wouldn't thought they we a of but year. with some So trend the a that, and preoccupied some seem that we

is of double really digits. cumulative year-over-year. year-to-date. XX% above The think effect decline in weaker It's orders being China the pretty actually if China is you significant,

from stimulus orders, help that's in help year. total again our P&L getting anymore. funding. this So to waiting By not million now, year this anymore we over several seemingly pushed China accumulated us the it second quarters this thought for of QX, in to going saw we effect to even of isn't where the people half in far Not going $XXX might that as and has it in are as and QX cumulative back

encouraging the activity. there is a lot On of side, really

BioSpin big-ticket particularly to beginning et are but quantify it's seeing to orders. microscopes, items, spectrometers, mass it We be other also going cetera. our Cannot for see yet, but stimulus them for we're beneficial probably business,

So -- would super strong science this U.S. perhaps and now, right I bit residency weakness there's life Generally instrumentation. that from a academic isn't -- prior spending I've add, little election. in seen to life the to the we but the other also -- biopharma, science companies, related of

rest So these indeed to fourth and and for X up effects of needed the do -- guidance to we our wanted for the lower our where year. to the is add lower quarter

Puneet Souda

Got have on XXXX, gave it. to And you then I ask $X.XX bit about the EPS update mean, I acquisitions call. a before expectations

to wondering too. and or biopharma you're thoughts that some any given 'XX academic weakness on China change additional Just the just that from seeing any

Frank Laukien

Those they from starting will base. orders lower probably items. the a from X for stimulus X, given We're of a big Yes. have tier That's to also be in quarters That's here lot mostly time. delivery and an tend since anticipated. a China

the the of So our P&L, from I China said in in we may speak, in second the stimulus to year. as so half arrive call, benefit

on it guidance. so pretty not And XXXX lower is but 'XX obviously, XXXX definitely makes new for QX, it clearly. me -- let sense because important, give giving we'll to will that we're complete be our So say then based QX estimates guidance for

Operator

of The Bank from next America. comes question from Ryskin Michael

Michael Ryskin

the confident margin point. I I Frank, remarks significant strong a follow point you above-market in want mean on of in prepared 'XX. you're up expansion in and to made last growth Sorry, that

just of lot, this talked there's revenues. swing said, that driving the and a there's like And between So early you You spendings about a but given as sort see factors? what's what you visibility? orders confidence this delay X-month still China do biggest

next tailwinds that's So do you in give next right? you half confidence contributing that for else only year? year, see of the as what second growth above-market So

Frank Laukien

good question, Michael. Very

with ELITech as from around about year stronger which reported we've -- the QX business seems So life if as are science metrology I had beyond moment months semiconductor demand Diagnostics throughout significant we a MALDI at Biotyper excess in to months. to we're tools, still be very like. still others But pretty We're backlog, very the have that, to generally the X very really about have newly of diagnostics mean, backlog, the well, way be satisfied X be than normalized good driver. you is the going should that's strong particularly for going acquired and really

that. pleased so with And we're

APAC in parts reasonably China of in Europe. and government the rest outside of world, the spending actually has Academic in other in of same been strong

are many they there of that So will of it's the -- at are because know that drivers funding, the significant known to a China There are all and of normally solid, still step-up quite difficult our stimulus don't rate are strong things there we average can just still because the actually recovery. the how in in it's enough are apply for first things funnel and projects optimistic half we are and percentage that these quantify next about strong can we not that we be but waiting that win year opportunity seeing orders have what are look drivers. in QX we -- because funded. We're

already October, as We how But receive stimulus some to, that did add know are -- will in orders don't much in. we up in orders yet. expected, coming

think also this orders year. and we're pretty of after pick up year indeed, to also good the the in in weakness the pronounced recovery shape, biopharma certainly X And year of market. will first first some be will that do the the outgrow there that second anticipate and XXXX, by believe the China months next for half So we the of I half

next parts year shape both of to So that year, good outgrow market. for I for in the think the we're

market will we for guidance, the probably set kind will set companies our will with loss the will hope for of other then don't which But market level trends lot have bit think automation sites lab We of for that multi-omics, these good be the costs that are guidance of making that and the What demand spatial actually course, cutting proteomics, XXXX. is lab that there I know think early biology. will that. give little countercyclical, yet automation investments tone in we and very guess fundamental to are and a are digitization. and markets, their we February, with growth all a And Companies be, the there. cutting

So acquisition I is would nicely placed. I strongest driver, semi. think very Chemspeed single say, driver, our the The biggest

Michael Ryskin

color, Okay. just to really though. That's helpful X reconcile all I Frank. want other point,

did the strong. about of you've a You X really that touch on number times. talked backlog months, is

growth. bookings about talked You

to So other materialized. things has of some new, China thought -- for backfill understand do timing the orders? that the Is so I to I no are where it's cut. without so if be is you backlog That's fair a But I'm guess move able saying and that there'd a that's that just and X been on backlogs revenues? And easy debated. of months point, biopharma perspective you not that weak. I aren't around. those revenue guide not why strong, more have support what that's has the recovery hand, understand not

Frank Laukien

billion billion. so. by It's step-up at That's had significant. more sequentially far $X It QX the did, $XXX largest to $XXX looks very reaching that Yes. is we've still fourth million million about not That's fourth the the We're Well, and pretty close implication. That's actually. and of this million, very if $XXX then course, $X QX step-up QX is to from we, quarter to quarter. you quite it QX the from substantial, year, look like sequentially, right? or

we that not it's here. So ambition lack

look as these but it's for you think line fourth -- the that's how quarter. things the up, at look you I how guidance prudent these think just as I

Operator

from comes from question Patrick next The Donnelly Citi.

Patrick Donnelly

on margin one. X dilution we about of the impacts. NanoString, maybe the you biggest are some of acquisitions, obviously I know that? from Can just Gerald, where the kind just on talk the

like that guide It way want the the just is the still for know think And guys Curious to this it? those maybe had it, think to you around but deals. $X.XX with half little talk that's should slipped be we I that next $X.XX about had I felt you bit. what's I through right if our that. on past just year. that of arms year. to could a said in going

Gerald Herman

are I including the talked nicely. integration applied mentioned. would that activities say into are track, about Patrick, you The We've the all we of and management overall now on acquisition acquisitions, generally, how newer just historically, Bruker X progressing that's I these pretty we now. 'XX this. for we went Patrick, or us picture for through see expectations and dilution what thus 'XX really respect for to dilution far with And XXXX is solid. right aren't fundamentally those, our think, modifying We XXXX at process

Frank Laukien

in on XXXX we're the businesses, So really bring those good really and there. to breakeven that think acquired we're the track very and good enthusiasm type of management businesses, still teams -- management I Analysis maybe to add, Patrick, to Cellular the by NanoString with aiming for aligned and

of tools wing our It have biopharma. expect a is course, pretty under significant track. in on bit really strength yes, That's materializing fully we yet. help, to more life and wind science X each So the in margin years. would of improvement little not That next

now And what side convert so have still. weak the others seen that on tools, we biology spatial is and demand right there life science in the in

Patrick Donnelly

'XX are about And government What just Understood. hearing the thinking What you into would on helpful. change outlook? How that year, from in then, obviously, expectation kind be into U.S. going day market next today? Frank, just maybe And customers? could Yes. are here a impactful pretty you just the that academic of

Frank Laukien

which in and a That's I aca/gov the outcome. of good uncertainty And the outcome. because people businesses that don't best there this government outcome one, price in quite our moves sector, about including maybe right concerned X perhaps those other, Those my that now, the non-- about avoid honestly, if X, are taxation know more in way know the for election, be is biopharma So control would where industry help the that other Yes. X NIH extreme concerned right? would ourselves. we doesn't the outcome tonight, was the funding, maybe it's on or X once maybe think in weeks, going. split And my interpretation and

maybe think But until an but about it's know maybe of know now, And we Right some the split say. tariffs, government, price there, what are lot back. race about taxes? presidency. there optimism that, there's uncertainty on and know I with there I be lineup. how also more may exciting predictability that's there only not in would going a to are House controls and I Are and of that Senate we'll come hesitancies

Patrick Donnelly

Frank. weeks, not it's we'll X but it, Appreciate see. X or Hopefully,

Frank Laukien

Maybe we faster, the right? and can figure Yes. House Senate, out

Operator

Next comes from Vatnsdal Rachel from question JPMorgan.

Rachel Vatnsdal Olson

So earlier up X here follow the I to just on wanted top questions of line. on

bit what half or either markets at can back longer for that get assuming within on model you would So clarify mentioned the out that down also, some contributing between by point then were just organic actually And line and into in just of the biopharma growth previously But of worse you to break look that XXX top no areas those there's recoveries just that. taking the cut year basis across guidance sequentially you like the point? points. for Can called moving XXX biopharma a little you're that recovery more China you other zealous any China. pieces other this you reduced us? you that and basis if in Did

Frank Laukien

Right.

So Rachel, think. got I it,

So effect of biopharma. is top even than China stronger line, the

talk that that and So now optimistic actually terms are biopharma believe help slowing we're in not the optimistic X/X little there. bookings. about that -- meaningful things as -- in it's of P&L roughly And be November in X/X at a bit us down way. may on -- China we recovery, revenue that a won't a anymore, generally, really least but us in more We're bookings those on significant in have

year. second orders in others of in the us last and first Some will the help half half the

So yet, We believe we about with program. cannot China quite optimistic a being stimulus that. in do very but we're it recovery quantify likely very

everywhere. with they're cost And cutting, well, point aggressive done some be will biopharma right? about it at pretty their And

to level they'll some call I where they're the timing reinvesting. So I point, new on think one. that a at can't find

orders part yes, QX I'd didn't we reasonably pretty your your China weak beginning And surprised orders QX have orders were lower long. we China much last than had of if year a in question, after to and So we relatively good come optimistic expected. orders I'm so very that QX to all China, be in. what activity have

this to some in perhaps year And with and able QX going even this it's mostly up anymore. QX, QX, then QX But turning into we to now orders, also have been deliver then of still would happen just not into those, year.

Rachel Vatnsdal Olson

Got it.

for then want And follow-up, order into dynamic. that my actually did dig Okay. to I

basis. give not on just then And book-to-bill separately around book? best stat may quarter? the China how about look down mentioned go-forward can order us the book-to-bill, trends a you book-to-bill a you Bruker And be talked digits So you You in other you on that quarter. orders grew little talked of for us? kind the was that break weaker, mid-single at how any in this to upper Can but bit about

a still should we if expect some basis we book-to-bill to to Will going stat at shift? point? shift so, on annual And when that forward? should this So expect an get quarterly

Frank Laukien

we Yes, questions, and has expect all So third that and that give above that do we -- annually. in X.X the below X update year-to-date to right? good book-to-bill been don't quarter

-- more it annually. I was. where asked, so that's think But it's you a that figure useful since

weakness had that. the what book-to-bill line So in the been with like of in something half the or year. No first it greater

in that you growth, In the organic -- best bookings other in quarters. BSI actually X of is X, organic growth BSI terms these this the fact, as bookings been has measure

So yet, but right write direction. about encouraging. the going to in is home It's nothing it but it's --

everything weakness growing is is weakness X that the single high down China you -- tells and the digits. These bad the in clearly else biopharma and drag in are which a China biopharma year-over-year. Despite guys, China

parts So good the growth momentum. the business other pretty have of

certainly year Now shape. first good for think we could I the year, of half next the -- in of pretty we're

from some use anticipated assist funding turning stimulus corner. the we biopharma For of half China, second and could year, next the from

Operator

The Peterson question Jefferies. comes next from from Tycho

Tycho Peterson

you to which want check. then significant gut but margin could about year, a assuming 'XX, And us you you I growth? talk if a next you a want high-level talk I to framework know wondering really just market maybe there. normal just Are X% previously don't did expansion. to about guys give you about X% talked I'm

Frank Laukien

muted sure. by a the next assume second year. We're would order, to in of recovery expect market with maybe reverse a next for not estimates maybe more don't snap 'XX In we normal or year. in half but we our back

a 'XX. to your growth and goes us If to was? we're that modeling, of question for part But would right of an not over the 'XX that great. it and that first year the were be sorry, expect market for back rates X% yet. normalized surprise I'm improvement we're to normalized the expecting full for X%, now, And market We

Tycho Peterson

expansion about significant Street's as your basis I'm significant curious just it at give if -- view? points. The talked means 'XX. you You margin what can XXX maybe at significant characterized you in us

Frank Laukien

that. Yes, north of

points on but billion higher or and that's orders. So to for early orders, higher that. than QX XXX the because $X also revenue, it's too biggest in quarter depend it's Yes, than it close only big a basis will very not

acquired give So but working that business. on reductions generally not in the those avoidance, strategic the But of we to newly particularly our very we'll margins meaningful we're course, working throughout reduction, dilutive are businesses some great numbers. expansions. cost need all hard, anticipated, And headcount as to more cost

that. So be more to I like going hard for that in something with bracketing the Clearly, will than that. that, you've or we margin give would But expect be driving greater bps. mentioned north you number cannot it's very of aggressive XXX improvement

Tycho Peterson

the can of great. demand I'm strong, there recent Okay. curious then I just a data know haven't been more. comments just but out you trends flesh if follow-up your points semi. obviously, have And been some on

So next front? seeing? thinking semi what on are what are the you year you about And

Frank Laukien

and year-to-date not than instrument to growth, even sometimes orders Well, segment, segments, in certain XX% to double nice in certain sorry, QX, our seen semi very a clarify. greater -- have digits,

high So But year, of next growth rate semi the just my Bruker would numbers, not specific to have rate not should fingertips It's be the that semi didn't growth give into charge. of organic really leading be, be the probably will go granularity that but the realize you have -- the type I I we just end at -- we think whatever that will number do numbers. it, can't I either. number, also want but I that don't at I have I

our fair guidance And wouldn't XXXX February, obviously. you in if X give think this a semi able really be you up there when -- again, solely until the a give in it's you early But average and give be I for on be question, we'll guidance and weaker will color strongest. to ask here's Tycho, that we will will be some then strong among

Tycho Peterson

Is no market But other saw points. what the on crack from we some kind fair? end of ASML data and of based that

Frank Laukien

So of down that ASML for the EUV supply ASML chain, accounted expansion some not lithography is supply EUV eventually complete business chain with our in next they tools. that all is have the a generation their for initial chain and in the RI but that supply in size technologies bit not that their them slowing of systems, little but are they metrology, systems the

we're getting a supply because important market part It's still that's growth a we're new but all important us. of for a nice small So growth baked It's of of and an all that chain. -- a into sudden in. part nice

this upside. us, is all for So almost

Operator

from Next Cleveland Waldman Research. Josh question from comes

Joshua Waldman

A for you. couple

like Is right? excluding placements, provide how in how declined quarter. the that the your assumption guess for Gerald, Just in BSI two you've surprised most curious have the where informs business the grew I what your First, on mean I wondered that sequential seen where into progression seems that or and most pullback the versus you're and may QX? it expectation? could compared I if more quarter, X color gig you

Frank Laukien

last we X year. had think I

Gerald Herman

third in put did prior semi I we solid solid. business. our have as we're X would disappointing X discussed growth the say can trends if has Frank perspective the of and in had generally way probably already biopharma say we did we that it China the I quarter. areas think a most Josh, in quite is the would quarter the have clean that discussed, had to the part in revenue What around relative earlier from was here, were We that Industrial year we tech We expectations. I

So X relevant had encouraging and significant that we've in would this out I China, for would very and spots. is be say the biopharma called say. that we BSI I particularly bright would

Frank Laukien

asking. you're gigahertz class of in this them On since of X the QX year.

this quarter supposed needing was but first systems University that really The the was of rework. them up Georgia of of was of One year. intended for originally the ended that X to,

planned we QX system had organically comparable been for from last and and that's the always grew moved to it X when system So to Korea also QX system. and had XX% QX year gigahertz QX, a

take So planning gigahertz QX X. want $XX gigahertz if for XX.X% QX, X so to model you class we're year, adjust X had or to that. for X growth. or and This for X organic we million versus last system, year, And systems

Joshua Waldman

Frank, on And comments. follow-up Okay. previous a your then

from to the about just is the into about can second rec here recovery in X-quarter the implied backlog. way think trends, think you what drive growth you you 'XX? given right and rev As the the you lag think medium typical HX comments of contemplate Do recent half on term, your single-digit order you low think in

Frank Laukien

got no. That XX% right to about that's No, in all. actually the at growth not 'XX, in not look no, XX% would Think No, think organic QX. and at this. QX growth about to you've organic -- way --

at look to got You've our comps.

fourth in earlier, third said on growth but of good be growth very very, I just as top So last and XX% year. quarter the of recovering last not to mean XX%, organically numbers putting our from we're defensive drop, numbers don't onto that and I we're here, of respectively, year's growth

facing a growth with rates organic And mercifully, QX right prior QX -- now. will we're year be quarters Now lot easier, comparisons double-digit our right? also what comparison will get QX comparisons to as not

answer -- X important in for numbers half for Is an growth the everyone. asking Thanks think of -- the 'XX question even clearly, only they're take nobody second close was growth our else actually. from that extrapolate that numbers of I that's no, growth the is half rates that, rates So in pretty second to. 'XX growth because amazing don't organic second half the

Operator

comes from TD Brennan next The from question Dan Cowen.

Daniel Brennan

series some of just can I just Frank, to called it kind ask hoping since a questions Maybe here, times. of on China I get color. stimulus, was few you've just a out,

is the China a should one? billion X as expected like like And of we've we like right $XXX others? on b, then government expect be the Or looking stimulus first you the that? do stimulus? measures, tracked Q&A size announce stimulus a at it And in for said as Is you new a terms of more the know maybe program But that what kind -- you your there monetary is are to any So Bruker. of Bruker? that way excuse to potential me, fiscal really then to implications you impact can't in think yet I prior do from expect come large during instruments money to about for kind

Frank Laukien

good not aware question. of I'm you're a -- So

own arrives then somewhat So Chinese priorities, in in of right? that any with QX. orders is it innovation, pace. whether -- not the arrived, province quickly framework into about, this the in it moves is although general and a further How each and way. with talking previously their making in baked with stimulus medical fiscal at we're announced own And provinces X investing that's their the of scientific to stimulus The it

this QX and of going orders will think Some to -- year. of arrive that single beginning maybe bolus quarter time, in the QX. come for in all in We it's not next but a be

next predominantly of it in of and will be think QX kind HX We year.

business. say the might just of to I I depends I've all got the of cannot not I'm are. many and the it that's our could sizing It would that. would this just it's customers. into yes, will go yet, to next but 'XX in low academic be benefit which is a but continue pretty research percentage. normally, positions time, that And and I next for think good in. or within programs, normal comes probably it we more knowable use going most. when lot people at could However, expect help applied be a items very the We numbers we particular, that, X yield and XX ticket mostly some feeling very opportunities, to would these difficult of And year, than So -- BioSpin because also well it's us get whatever our about us the big bps not that our that -- mean, XXX end X so of we're it benefit think all and talking it be I X, have growth

Daniel Brennan

maybe care don't just peers that's past, to And what tools think is I weak spot just other Great. but growing been then you've sense that done that you for you? the biopharma here. as a mean, business I give a us follow-up, a would biopharma us on since give will number. of a in

headlines and be the So analysis just that think actually and mean, when looking I proxy look it compared basis. R&D a you from just at, improves? on spending, like did don't first that, wondering we do biopharma how an but for this should an QX in great, the to as like okay And we what looked half? to related then

be should to the can So just metric not we of kind is R&D to right turn? at? Or what when this monitoring see look

Frank Laukien

Right.

bookings down. revenue at although So Q-to-Q. it nearly look Year-to-date, not biopharma to versus just numbers -- is and yes, trying down,

So if China. down much is catch-off as including CRO biopharma this as a biotech as for us year, and not

biopharma. in XX% but around been grow our of had generally, want We it So inorganically up. to revenue, that's also going

a spatial has from analysis our So Bruker significant than business, demonstrating biopharma extend cellular to our traditionally. our business. benefit more analysis much They Chemspeed all business,

roughly, had if XX% Bruker biopharma that's XX%. very towards revenue from trending of So traditionally its

time as to it And that worst which pleased time, XX% but beyond XX%, gone will will the in biopharma further our will or have weak, at wanted we come who that we back. opportunity very now up be towards biopharma cares, right that and that doing is by We're exposure strategically have.

If you it ago, very a was close to XX%. long recall, time

So we there. were clearly underrepresented

Do helps China. as right. questions? much in you of have Maybe triangulate. a will All be think at of eventually, it revenue. as I not but that XX% plus to year-to-date, overall down more our couple And you So

X more take questions. Let's

Operator

Couillard from Brandon from comes question Next Wells Fargo.

S. Brandon Couillard

is about X.X% [indiscernible] And that -- M&A Is down, on So year the prior the versus for just at at if rounding? ELITech color talk it performed? XX%. margin, and looks like the the contribution least coming any contribution

Frank Laukien

countercyclical Analysis ELITech, -- the part a and bit industries. immediately, ELITech the they're Chemspeed, piece, Cellular It that's primarily to great. which that's because investments for very out consider the pharma chugging CapEx from remarkably I even X.X% and among very weaker software exactly. said than in other biology investments We had But of analysis big programs, our and figured serves we expected been -- is actually expected related will Bruker to M&A, Brandon, strong. spread. that has and a it biopharma little Chemspeed cellular biopharma is that NanoString spatial than weaker XX% that's biopharma you took it's people big and related and demand along even piece. sites cutting also if

S. Brandon Couillard

EPS would Can makes guidance revenue. $X.XX. just sense? math why The came million that close ratings rates and decremental down $XX imply you terms in That XXX% of help me reconcile that XXX margin. -- to

Gerald Herman

little let complicated, start. but a me it's So

of That's And we level. by earlier CER we're the do guidance that. the exchange revenue. million into That about in actually of get our about On guidance, as China, we've dropping here. a million $XXX about from $XX mostly slight driven biopharma from elements talked translates benefit previous foreign actually

dollar that we U.S. a have weakens, recall a get may the strengthening we You tailwind. when revenue,

exchange. offsetted CER benefit by million of take So a to $XXX you that foreign related

to I to that was earlier. million get You $XX referring

Frank Laukien

The of FX that, have headwind. election been perhaps like of margin, with And or changes a because way an got that on the other the something the additional we it's operating margin XX dollar weakening the round. bps

So comes. that side

Gerald Herman

it It's how comes together.

Frank Laukien

you Last think question, more the day to of rest into your need Time and here. we'll let then I go for X question. all

Gerald Herman

Yes, more. X we can do

Operator

question Sergott from comes Luke next Barclays. from The

Unknown Analyst

China to kind comes don't there the backlog that going But to of and the actual funnel the however instead the about kind demand about of out could not X of of there year, wanted -- months, we and talked given up are how a elevated how flowing through the there. stimulus satisfy ultimately that follow the But demand and going really going enough just stimulus kind to building is how to through. of paces you just to I through? on that months lead chance of is X to kind early that next shake you be the know through as funds that think

Frank Laukien

Luke, Right. questions. good

of stimulus some China through. So some that through come seeing will now. We're it of come

tenders. so We add specifically is us, not those all. growth, Some some that think funded XXX favorable of tenders for are they're it point, will it's going and it, It's at we we coming we'll think is about into much be worry at just bps first activity the -- next a it It to help 'XX. would could half and also the half effect. stimulus. But larger. Certainly, of delayed be the be kind from a much, of year bigger second That that yes. the of is could

and particular, not but be only in you -- big preclinical don't imaging, to good on the looks and really want EPR, microscope other and I NMR, significantly it And the but funnel it. also big devices, raise more mass some expectations, for could items, ticket so spec name side

how I've it. optimistic to pretty given we're but the much that us. very it's too be lower optimistic So help more, of -- get tell. that we're end we will sort of it hopefully will help from well, there it Hopefully, might early will

Unknown Analyst

here then you All your perspective, going talked guys Yes. and that's I about know And XX% higher pharma a those thing. of Got that total of revs you right. it. revs. from It's don't all -- timing XX%,

us what discovery on more side. drug play you upstream seeing on So walk through can just you're kind of -- the you typically

kind So you for originally exit for a that the the can things outset where for lot you weaker particular and talk got about were demand what year? funnel or early the expecting you you as of

Frank Laukien

whether what that of Well, pharma when CRO CROs is the good of will seeing also, they cut it it consolidate geopolitical pharma hear not cut American reduce they only cutting not, has cost doing head we're got China hardest, you big And no, first kind some European need course, not But right? sites, are but but to count. reduce time internally. to programs, some cuts, lot this for for demand, programs, just gain Well, -- a that's of surprise a big of and to there pretty or Indian give CRO or kind them hit they the or their streamline then they CROs. CROs, no,

taking say of genomic that. to am proteomics era customers our are post I delighted and that not the brunt

CapEx post-genomic or But in were lab spend a with our spot are budget in even proteomics, they're some is in markets being right eliminated customers getting they something again, the reduced lose So space, QX and multi-omics headcount or QX, like don't spot. that. or a now sweet a to sweet while not because or other if group

difficult. So -- biotech pretty and -- series has is emerging funding [ tough is of seed and biotech been difficult, and even and BNC [ ] has sort remained A ] early now

They're have from compelling still a of very markets So difficult And biotechs very a what capital program. say the very, I is also delays funding instruments. step in don't think do because that that is But observing. selected we're late-stage there leases it general, up. new purchases or I'd they

Okay. much. Thank very you

us for over be and you we thank a day America, for much interest. you I Sorry, hope very eventful will thank your little joining an for ran today. it today nonetheless,

Operator

you Thank concluded. today's for now has attending presentation. Conference

You may now disconnect.

Bruker (BRKR) 5 Nov 242024 Q3 Earnings call transcript