Bruker 10-Qquarter ended 2026-06-30

Impairment / charge

CST and BSB goodwill impairments overwhelmed stronger gross profit; the Q3 segment reorganization prompts another impairment review.

Filed 2026-08-05 16:24 ET

Key figures · Q2 FY2026 · period ended 2026-06-30

  • Revenue$838.5MYoY +5.2%QoQ +1.8%
  • Operating income−$65.3MYear ago $11.9MPrevious quarter $10.2M
  • Net income−$52.0MYear ago $7.6MPrevious quarter $14.4M
  • Total assets$6.1BYoY −4.5%QoQ −1.3%
  • Total debt
    How total debt adds up
    Long-term debt$1,815M
    + Current portion of long-term debt and finance lease obligations$10M
    Total debt$1,825M

    Lines as the filer presents them on its balance sheet.

    $1.8BYoY −25.1%QoQ +9.2%
  • Shareholders' equity$2.4B1YoY +31.9%QoQ −2.7%
  • Tangible book value$102.6M2Year ago −$799.4MPrevious quarter −$8.3M
Notes (2)
  1. Shareholders' equity: Total equity including noncontrolling interests; the balance sheet does not show the shareholders' own share as a separate line.
  2. Tangible book value: Total equity including noncontrolling interests; the balance sheet does not show the shareholders' own share as a separate line. From the notes to the financial statements; the balance sheet does not present this as a separate line.

Alerts

Summary verification

  • Small difference

    Total debt: Summary: $1.83B · Filing: $1.8B

    Comment from AI: The summary states total debt of $1.83B; the filing reports $1.8248B.

How we check summaries

How this filing reads

  • Health−0.2Liquidity has $185M cash and $729M revolver capacity against $1.83B debt; H1 FCF was $(59.2)M.
  • Momentum+0.1Q2 organic revenue rose 2.8% and gross margin reached 49.6%; H1 organic revenue fell 0.8%.
  • Outlook0.0RPO rose to $2.78B; Q3 impairment analysis leaves asset-value outlook uncertain.
  • Impairment / charge“Q2 goodwill charges included $98.4M for CST and $36.5M for the BSB reporting unit”

Executive Summary

Bruker delivered Q2 revenue growth and a sharper gross margin, led by its CALID business and demand from biotechnology, clinical and semiconductor customers. Yet H1 organic revenue declined, and $134.9M of goodwill impairments turned improving underlying operations into a GAAP loss. Cash conversion also lagged earnings as working capital absorbed cash, while a Q3 reorganization creates a near-term test of whether revised forecasts support the remaining goodwill. For investors, the opportunity is a recovery in organic demand and cash generation; the immediate risks are further impairment, uneven regional demand and potential preferred-share dilution.

Key Financial Highlights

Metric Q2 2026; H1 2026 where reported Investor interpretation
Revenue $838M, +5.2% Y/Y; H1 $1.66B, +3.9% Reported growth outpaced H1 underlying demand: organic revenue rose 2.8% in Q2 but fell 0.8% in H1.
GAAP gross profit $416M, +16.2% Y/Y; H1 $796M, +6.2% Q2 gross margin rose to 49.6% from 44.9%, aided by savings, volume, mix and favorable net tariff effects.
GAAP operating income (loss) $(65.3)M vs $11.9M income; H1 $(55.1)M vs $43.7M income A $135M goodwill charge overwhelmed better gross profit.
GAAP net income (loss) attributable to Bruker $(52.0)M; H1 $(37.6)M Preferred dividends increased the loss attributable to common shareholders to $(62.9)M, or $(0.41) per diluted share, in Q2.
Non-GAAP operating income $118M; H1 $203M Excludes specified adjustments, including impairments; it illustrates operating capacity but not the reported result.
Total assets; shareholders’ equity $6.05B; $2.40B at 6/30/2026 Goodwill and intangible assets account for $2.30B of the balance sheet.
Net tangible assets $103M at 6/30/2026 Shareholders’ equity less goodwill and intangible assets leaves a narrow tangible cushion; this measure does not deduct preferred equity.
Cash and equivalents; total debt $185M; $1.83B at 6/30/2026 Available revolver capacity of $729M supports liquidity despite low cash relative to debt.
  • Cash conversion: H1 OCF was $(6.2)M against a $(37.6)M net loss attributable to Bruker; after $53.0M of capital expenditures, FCF was $(59.2)M. Noncash charges lifted the cash-flow reconciliation, but a $221M adverse movement in operating assets and liabilities more than offset that benefit.
  • Earnings quality: A $27.6M unrealized equity-investment gain and a $12.2M gain on Bruker’s former Tofwerk stake partly offset losses; neither represents recurring product profitability.
  • Capital returns and dilution: No shares were repurchased; common shares outstanding increased from 152.1M to 152.4M during H1. Preferred dividends were $21.8M in H1, and the mandatory convertible preferred shares create future common-share dilution.

Business Developments

  • Growth mix: CALID Q2 revenue rose 8.6% to $310M, supported partly by acquisitions, while BioSpin was broadly flat. North America and Europe grew, but Asia Pacific declined; biotechnology and pharmaceutical, hospital and clinical, and semiconductor demand outweighed weaker academic and government research spending in Q2.
  • Acquisition and pipeline: Bruker acquired the remaining 60% of Tofwerk in January to expand its high-resolution, real-time mass-spectrometry offering. Remaining performance obligations rose to $2.78B from $2.57B at year-end, although installation and customer-site readiness determine when orders become revenue.
  • Organization: Effective Q3, management reorganized businesses into new BIOS and Microbiology and Infection Diagnostics segments, leaving NANO and BEST unchanged. Management’s stated aim is better accountability and customer focus; the investor test is whether the new structure improves execution without further eroding asset values.

Risk Assessment

  • Impairment and forecast risk: Q2 goodwill charges included $98.4M for CST and $36.5M for the BSB reporting unit; BSB’s carrying value now approximates fair value, and the Q3 reorganization prompted another impairment analysis.
  • Cash generation and leverage: H1 FCF of $(59.2)M and $1.83B of total debt increase reliance on improved collections and available credit, despite covenant compliance.
  • Demand and trade exposure: H1 organic revenue fell 0.8%, Asia Pacific sales declined, and tariff uncertainty has weighed on bookings; approved tariff refunds benefited current costs but do not resolve future policy risk.
  • Execution and integration: Acquisition integration, restructuring and delays between orders, installation, acceptance and payment can defer both revenue and cash receipts.
  • Potential dilution: The 2.76M mandatory convertible preferred shares are scheduled to convert on 9/1/2028 into 6.9534–8.5179 common shares each, potentially expanding the common-share base.

This 10-Q lists no risk factors of its own and refers to the annual report. The risks above come from the rest of this filing. Full list: FY2025 10-K.

Strategic Outlook and Investor Actionables

The near-term investment case hinges less on reported revenue growth than on converting orders into organic growth and cash, while sustaining gross-margin gains. The Q3 recast will also reveal how the reorganized businesses perform and whether further goodwill charges follow.

  • Organic demand: Watch Q3 organic revenue growth and regional bookings; sustained positive growth would strengthen the recovery thesis.
  • Cash conversion: Watch OCF, inventory and receivables; improvement must translate into positive FCF rather than remain tied up in working capital.
  • Asset values: Watch the Q3 impairment analysis and revised segment results; another charge would challenge management’s forecasts for the reorganized businesses.

Figures are computed from the filing's XBRL data; the summary and scores are written by an AI model reading the filing.

Model 005 · prompt 9e47f58d3c

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