Abstract

Bausch Health Companies Inc will report its fourth-quarter 2025 results on February 18, 2026, Post Market, with investors watching revenue progression, margin stability, and any updates around late-stage programs following recent clinical news.

Market Forecast

Consensus for the fourth quarter points to revenue of $2.71 billion, implying 7.89% year-over-year growth, EBIT of $1.01 billion at 23.56% year-over-year growth, and adjusted EPS of $1.27, up 12.29% year-over-year; margin forecasts are not specified, so investors will focus on whether gross margin remains close to the prior quarter’s 72.03% and whether net income continues to expand from a 6.68% net margin baseline. The company’s segment mix remains centered on its Bausch + Lomb/International operation, supported by the prescription portfolio; the most promising near-term growth lever remains the U.S. gastroenterology franchise housed in Salix, though recent clinical outcomes may temper sentiment heading into the print.

The main business continues to be Bausch + Lomb/International with $1.57 billion in revenue in the prior quarter, and the outlook hinges on maintaining stable sell-through and pricing while navigating foreign-exchange and mix effects. Salix, which generated $716.00 million last quarter, remains a core profit engine with durable prescription brands; year-over-year growth for this specific segment was not disclosed in the dataset, but the company-wide prior-quarter revenue growth was 6.81%.

Last Quarter Review

Bausch Health Companies Inc delivered fourth-quarter-to-previous-period results that showed revenue of $2.68 billion, a 6.81% year-over-year increase, gross profit margin of 72.03%, GAAP net income attributable to the parent of $179.00 million for a 6.68% net margin, and adjusted EPS of $1.16, up 2.66% year-over-year, while sequential GAAP net income grew 20.95%.

A key highlight was outperformance versus internal and external baselines: revenue of $2.68 billion exceeded the prior estimate of $2.63 billion by $55.42 million; adjusted EPS of $1.16 surpassed the $1.06 expectation by $0.10; and EBIT of $0.93 billion came in above the $0.86 billion estimate. From a business-mix perspective, Bausch + Lomb/International contributed $1.57 billion, Salix delivered $716.00 million, Diversified Products posted $258.00 million, and Solta Medical contributed $140.00 million, helping support the 6.81% year-over-year revenue expansion at the consolidated level.

Current Quarter Outlook (with major analytical insights)

Core revenue engine: Bausch + Lomb/International

The company’s largest revenue contributor remains Bausch + Lomb/International at $1.57 billion in the prior quarter, accounting for a majority of consolidated sales and providing a base from which operating leverage can accrue if fixed-cost absorption and mix are favorable. Heading into the fourth quarter, the market’s $2.71 billion revenue expectation implicitly assumes this core driver sustains stable volumes and pricing, which in turn helps protect a gross margin that stood at 72.03% last quarter. With margins not explicitly guided for the quarter to be reported, investors will watch whether the business can hold recent profitability levels despite potential foreign exchange variability and product-mix shifts between higher- and lower-margin categories.

Management’s recent cadence suggests that when Bausch + Lomb/International performs steadily, consolidated EBIT benefits disproportionately given the scale of the segment and the ability to amortize certain fixed costs across a wider base. Conversely, any unexpected softness can quickly translate into deleverage, which is why the quarter’s read-through on mix, pricing discipline, and any seasonal promotional dynamics will carry unusual weight for EPS conversion. The market’s expectation of adjusted EPS at $1.27 (+12.29% year over year) implicitly assumes margin stability or mild expansion relative to the prior quarter’s 72.03% gross margin, making any commentary on input costs, promotional spend, and channel inventory normalization particularly relevant to valuation on the print.

Highest potential near-term growth: Salix

Salix remains the most promising near-term growth platform within the consolidated portfolio, generating $716.00 million in the prior quarter and serving as a key lever for operating income given the typical margin profile of branded gastroenterology products. The EPS outlook of $1.27 (+12.29% year over year) and EBIT forecast of $1.01 billion (+23.56% year over year) are consistent with a scenario in which Salix maintains healthy prescription trends and disciplined spending, even as broader market dynamics evolve. In the immediate term, pipeline developments present a mixed picture for sentiment. On January 23, 2026, the company disclosed that two global phase 3 trials for rifaximin in the prevention of hepatic encephalopathy did not meet their primary endpoint; while commercial impact for in-market indications was not signaled, investors are likely to treat the update as a risk to long-term lifecycle expansion rather than a near-term revenue headwind.

Into this quarter’s release, the most important datapoints for Salix are likely to be volume trends for key prescriptions, price realization versus payer dynamics, and any updated commentary on life-cycle management across the portfolio. If growth in Salix outpaces consolidated revenue—as the EBIT forecast implies—there is potential for positive mix effects that support gross margin resilience and EPS leverage. Conversely, if management adopts a more conservative promotional stance or if channel dynamics indicate moderation, investors may infer a lower contribution from Salix, putting more pressure on the other segments to fill the gap. The degree to which management addresses the post-trial path for rifaximin-related programs could also shape forward expectations for 2026 and beyond, even if the immediate quarter’s numbers are in line.

Key stock price swing factors this quarter

The first swing factor is margin trajectory relative to the prior quarter’s 72.03% gross margin and 6.68% net margin. The company’s revenue consensus of $2.71 billion and adjusted EPS consensus of $1.27 assume the business can hold or modestly expand margins despite potential variability in product mix, cost of goods, and promotional investments. If Bausch Health Companies Inc demonstrates stable gross margin and operating expense control, the EBIT forecast of $1.01 billion becomes more credible, supporting the expected 12.29% year-over-year rise in adjusted EPS. Any deviation—either via higher input costs or less favorable mix—could disproportionately impact EPS given the company’s fixed-cost base and interest burden.

The second swing factor is the impact of clinical and pipeline newsflow on investor confidence and valuation. The January 23, 2026 update that two phase 3 trials evaluating a rifaximin formulation for hepatic encephalopathy prevention did not meet the primary endpoints is likely to sharpen focus on current prescriptions rather than pipeline optionality. While the immediate quarter’s revenue is principally driven by in-market products, the absence of near-term pipeline catalysts may lead to a more conservative stance from investors, who will look for clarity on how management plans to allocate capital, prioritize programs, and drive organic growth in 2026. The tone of management’s commentary around next steps for the program and the broader Salix portfolio, even without new data, will be parsed as an indicator of medium-term durability.

The third swing factor is capital structure and cash generation. The last quarter showed a GAAP net income of $179.00 million, representing a 20.95% sequential improvement in net profit, pointing to a constructive trajectory into year-end. Sustaining or improving adjusted EPS to the $1.27 mark would support deleveraging capacity and potentially reduce interest expense over time, but that depends on cash conversion and working-capital discipline. In this context, any guidance on free cash flow, debt repayment priorities, and potential portfolio actions can influence how the market translates a revenue beat or miss into changes in equity valuation. Given consensus revenue growth of 7.89% year over year for the quarter, the balance of volume, price, and cost control becomes the axis on which sentiment will swing.

Analyst Opinions

Based on commentary identified between January 01, 2026 and February 11, 2026, the prevailing stance skews cautious, with bearish/cautious views representing 100% of the identifiable opinions in the period. On January 07, 2026, Truist Securities maintained a Hold rating and lifted its price target to $8 from $7, while the average rating across coverage was characterized as Hold with a mean price target of $7.43. This posture reflects a market expecting steady execution but lacking strong conviction on multiple expansion until there is greater visibility on margin resilience and the medium-term growth algorithm after recent clinical outcomes.

The caution intensified following the January 23, 2026 update that two global phase 3 trials for a rifaximin program in hepatic encephalopathy prevention did not meet their primary endpoints. While the financial model for the current quarter still leans on in-market products and ongoing prescription demand, analysts appear to be emphasizing near-term fundamentals over speculative pipeline upside. That framework helps explain why the consensus for revenue at $2.71 billion (+7.89% year over year) and adjusted EPS at $1.27 (+12.29% year over year) is neither aggressive nor punitive: it anticipates disciplined execution but stops short of underwriting material outperformance without evidence of sustained margin gains or incremental product catalysts.

In-depth, the cautious view centers on several themes. First, segment concentration remains a consideration. The Bausch + Lomb/International segment at $1.57 billion last quarter underpins consolidated performance; if that engine slows, the overall P&L can deleverage quickly. Second, the valuation ceiling may be constrained by uncertainties around the long-term path for rifaximin programs, which now require reassessment after the January trial results. Third, the step-up implied by EBIT growth of 23.56% year over year in the upcoming quarter is achievable if expense discipline holds and mix is favorable, but any surprise in cost structure or a less favorable mix would make the $1.27 adjusted EPS target more challenging.

Even within this cautious framework, there are identifiable ways the company can positively surprise. Revenue came in ahead of estimates last quarter by $55.42 million, with adjusted EPS beating by $0.10 and EBIT surpassing estimates by roughly $0.07 billion, showing that operational execution can outpace expectations when mix and cost control align. If Bausch Health Companies Inc demonstrates a similar pattern this quarter—stabilizing gross margin around the prior 72.03% level, containing operating costs, and maintaining healthy Salix momentum—the market may reassess the sustainability of double-digit EPS growth, potentially shifting sentiment despite the absence of fresh pipeline catalysts. The flip side remains that, with analysts predominantly in a Hold posture and price targets around the high single digits, the burden of proof lies with management to show that margin quality and cash conversion can support a stronger equity narrative through 2026.

Ultimately, the consensus into February 18, 2026 balances measured expectations with a bias to caution. Revenue of $2.71 billion and adjusted EPS of $1.27 embed a steady progression from last quarter’s $2.68 billion and $1.16, while allowing for uncertainty around product mix and clinical newsflow. Should the company deliver on EBIT of $1.01 billion and articulate a credible margin and capital allocation roadmap—alongside clarity on how it plans to respond to the rifaximin trial outcomes—the prevailing cautious stance could soften. Until then, the majority view holds that near-term upside is contingent on execution, with modest tolerance for shortfalls given the recent reduction in perceived pipeline optionality.