• Organic Growth: 4% in Q1 2025.
• Adjusted EPS: $1.01, above expectations of $0.93 to $0.95.
• Free Cash Flow Conversion: 97% of adjusted net income.
• Share Repurchase: $154 million worth of shares in Q1.
• Outstanding Share Count: 119.4 million at quarter end.
• Diagnostics Organic Growth: 5% in Q1 2025.
• Signals Software Business Growth: Over 20% organic growth in Q1.
• Revenue: $665 million in Q1 2025.
• Adjusted Operating Margins: 25.6% in Q1 2025.
• Net Debt to Adjusted EBITDA Leverage Ratio: 2.4x.
• Adjusted Tax Rate: 19.5% in Q1 2025.
• Full Year Organic Growth Outlook: 3% to 5%.
• Full Year Adjusted EPS Outlook: $4.90 to $5.00.
• Second Quarter Revenue Outlook: $700 million to $715 million.
• Second Quarter Adjusted EPS Outlook: $1.13 to $1.15.

• Warning! GuruFocus has detected 5 Warning Signs with RVTY.

Release Date: April 28, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Revvity Inc (NYSE:RVTY) achieved a solid 4% organic growth in the first quarter, aligning with expectations despite a challenging macroeconomic environment.
• The company reported an adjusted EPS of $1.01, surpassing the expected range of $0.93 to $0.95.
• Revvity Inc (NYSE:RVTY) demonstrated strong cash flow management with a 97% free cash flow conversion of adjusted net income and repurchased $154 million worth of shares.
• The Diagnostics segment grew 5% organically, driven by strong demand and resilience against macroeconomic changes.
• The Signals software business showed impressive performance with over 20% organic growth in the first quarter, with expectations for continued strong growth.

Negative Points

• Revvity Inc (NYSE:RVTY) faced unforeseen demand fluctuations from US academic customers, impacting life science instruments and potentially limiting organic growth.
• The company anticipates a 60 basis point negative impact on adjusted operating margins due to tariff-related pressures.
• There is ongoing pressure on the Life Science Solutions segment, particularly in instrumentation, due to academic funding uncertainties.
• Revvity Inc (NYSE:RVTY) expects slower demand from academic customers to persist, impacting overall growth projections.
• The company is navigating a dynamic tariff situation, which could have resulted in a $135 million gross impact on adjusted operating income if not mitigated.

Q & A Highlights

Q: Can you discuss the $135 million gross impact from tariffs on US to China sales and how you plan to neutralize it quickly? A: Prahlad Singh, President and CEO, explained that Revvity started contingency planning right after the election, building redundancy in the supply chain to ensure product availability in China. Maxwell Krakowiak, CFO, added that the company is agile and has been proactive in navigating the dynamic macro environment, focusing on life science products sold into China.

Q: How is the Life Science Solutions segment performing, particularly with instruments and software? A: Maxwell Krakowiak noted that while the Life Science Solutions segment remains mostly unchanged from previous guidance, instrumentation is under more pressure. However, the software business is expected to grow stronger than initially anticipated, offsetting some of the pressures from academic and government spending.

Q: What is the outlook for Revvity's business in China, considering political tensions and market dynamics? A: Prahlad Singh stated that there is no specific heightened pressure on Revvity in China. The Diagnostics business is well-positioned with products made in China for China, and the Life Sciences side has been working to ensure supply chain redundancy. Maxwell Krakowiak added that they expect low single-digit growth in China for the year, with Life Sciences slightly declining and Diagnostics growing mid-single digits.

Q: Can you elaborate on the Signals software business and its impact on margins and growth? A: Prahlad Singh highlighted that the Signals business is a key part of Revvity's portfolio, benefiting from strong market dynamics and new product introductions. The business is expected to continue growing at a strong double-digit rate, contributing positively to the company's overall performance.

Q: How is Revvity managing the impact of tariffs on gross margins, and what are the updated assumptions? A: Maxwell Krakowiak explained that the gross margin is expected to be around 60% in Q2 due to tariff impacts, down from the historical 61.5% to 62.5%. The company is taking proactive measures, including supply chain adjustments and cost actions, to mitigate the impact and maintain competitive positioning.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.