Good morning. I would like to welcome everyone to Bruker Corporation's third quarter 2026 earnings conference call.

My name is Joe Kostka, and I'm the Director of Bruker Investor Relations. Joining me on today's call are our President and CEO Frank Laukien and our EVP and CFO Gerald Herman.

In addition to the earnings release we issued earlier today, during today's conference call, we will be referencing a slide presentation that can be downloaded from the Events & Presentations section of Bruker's Investor Relations website. During today's call, we will be highlighting non-GAAP financial information.

Reconciliations of our non-GAAP to GAAP financial measures are included in our earnings release and are posted on our website at ir.bruker.com. Before we begin, I would like to reference Bruker's Safe Harbor statement, which is shown on slide 2 of the presentation.

During this conference call, we will or may make forward-looking statements regarding future events and the financial and operational performance of the company that involve risks and uncertainties, including those related to our recent acquisitions, geopolitical risks, wars or blockades, market demand, tariffs, currency exchange rates, competitive dynamics, or supply chains. The company's actual results may differ materially from such statements.

Factors that might cause such differences include, but are not limited to, those discussed in today's earnings release and in our Form 10-K for the period ending December 31st, 2025, as updated by our other SEC filings, which are available on our website and on the SEC's website. Also, please note that the following information is based on current business conditions and on our outlook as of today, November 4th, 2026.

We do not intend to update our forward-looking statements based on new information, future events, or for other reasons, except as may be required by law, prior to the release of our fourth quarter and full year 2026 financial results, expected in February 2027. You should not rely on these forward-looking statements as necessarily representing our views or outlook as of any date after today.

We will begin today's call with Frank providing an overview of our business progress. Gerald will then cover the financials for the third quarter of 2026 in more detail and comment on our full year 2026 financial outlook.

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

Thank you, Joe. Good morning, everyone, and thank you for joining us on today's third quarter '26 earnings call.

Bruker continues to drive significant advances in post-genomic disease biology solutions and drug discovery, from proteoforms to glycobiology, and from functional protein interactions to spatial biology. These foundational advances in disease biology, together with strong growth drivers in specialty infectious disease diagnostics and in our deep tech and semiconductor metrology franchise, are expected to lead to significant revenue growth acceleration and further margin expansion.

Bruker's positive bookings trends continued in the fifth consecutive quarter of Bruker Scientific Instruments, or BSI, book-to-bill greater than 1, as we see increasing strength in most of our end markets, and I will highlight three areas in particular. First, US academic and government, or aca-gov.

In the third quarter, our BSI organic bookings in the US aca-gov market grew in the double-digits percentage year-over-year. This was the first quarter with year-over-year bookings growth in US aca-gov since the NIH funding disruption in 2025.

The prior-year comparison was a weak one, but this is nonetheless encouraging, and by the way, we also expect year-over-year organic bookings growth in US aca-gov in the fourth quarter. One could speculate that last night's blue wave in the midterms could also bode well for US aca-gov funding in fiscal '27 and beyond.

Second, China. BSI organic bookings in China were up over 20%, both in the third quarter and year-to-date.

This consists of broad-based demand strength as almost all of our BSI end-market orders in China grew nicely. Third, year-to-date, we've seen greater than 30% organic bookings growth in BSI semi-con metrology markets in the quarter.

This robust order growth is being fueled by the AI megatrend, which requires our metrology solutions for logic, chip foundries, high-bandwidth memory, and advanced packaging. While the lead times on these orders are longer than most of our life science tools, we expect to see these semi orders convert into revenue mostly in fiscal year '27, and some in fiscal year '28.

Speaking of AI, artificial intelligence, in August, we started a strategic collaboration with, and we did a minority investment in, Atinary Technologies, a pioneer of self-driving labs and agentic AI-driven chemistry R&D. Atinary integrates our Chemspeed lab automation and Bruker analytical measurement instruments into its agentic AI workflows.

The Atinary lab in Boston includes Chemspeed robotics and Bruker benchtop NMR for small-molecule synthesis and catalysis in pharmaceutical R&D and process development. All right, let's dive into the numbers.

Let's turn to slide 4 now for the P&L performance in the third quarter, where we achieved significant margin expansion and non-GAAP EPS growth driven by our focus on cost discipline and execution. Our third quarter '26 reported revenues of $874 million increased 1.6% year-over-year, with organic growth of 0.7%.

Our third quarter '26 non-GAAP gross and operating margins were 51.3% and 16.3%, respectively, both up significantly year-over-year. Our Q3 '26 diluted non-GAAP EPS was 56 cents, up 24% from Q3 '25.

Moving to slide 5, our year-to-date nine months Q3 '26 revenues increased by 3.1% to 2 2.54 billion, with organic revenue essentially flat. Our year-to-date non-GAAP gross margin, operating margin, and EPS were all up nicely year-over-year, and their year-to-date performance is summarized on slide 5.

As Gerald will explain in more detail shortly, in Q3 and year-to-date, our free cash flow also has improved considerably, and we have made excellent progress with deleveraging. Please turn to slides 6 and 7 now, where we highlight the year-to-date third quarter performance of our now-reorganized three Scientific Instruments groups and of our BEST segment, all on a constant currency, or CER, and year-over-year basis.

Year-to-date, the BioSystems Group revenue was $1.2 billion, up low single-digits percentage year-over-year in CER. Strength in biopharma and translational research was partially offset by weakness in aca-gov.

BioSystems saw strong CER growth in IR and Raman spectroscopy and in mass spectrometry, driven in part by the TOFWERK acquisition, which was partially offset by softness in NMR. Year-to-date 2026, our newly elevated Microbiology and Infection Diagnostics Group had revenues of $396 million, which increased in the low single-digits percentage, driven primarily by robust molecular diagnostics revenue growth.

Turning to slide 7, year-to-date Bruker Nano revenue was $770 million, with a low single-digits percentage CER decline. Robust year-to-date growth in semi metrology and biopharma was offset by weakness in aca-gov and industrial.

Semi revenues were down double digits in the third quarter, primarily driven by our previously communicated pushouts of semi metrology instruments from the third quarter. We had been very explicit about that in our Q2 earnings call when Gerald gave Q4 color that we expected the $20 million pushout from Q3 in semi-con metrology.

Finally, year-to-date BEST revenues were up 8.3% in CER, net of intercompany eliminations, with strong growth in Research Instruments, or RI, and solid growth also in superconductors. Right.

Moving to slide 8, we highlight our recent acquisition of MIMETAS, a leading humanized organ-on-a-chip, or NAM, platform. NAM stands for New Approach Methodologies, a commonly used term in the industry and also by the FDA.

I'll let you read some of the background on MIMETAS. I think it's a reading slide rather than me going through every bullet, but I think it is very important to get the higher-level perspective that in addition to multiomics and spatial and structural biology, and AI-augmented drug discovery, one of the pain points and one of the reasons for the failure rates of so many drugs when promising drugs gets translated from mouse models or animal models to humans are toxicities, are off-target toxicities that are unique to humanized models and human physiology.

MIMETAS, with its humanized organs-on-a-chip, which can be nicely automated, which have many disease models, and are poised for very significant double-digit growth with high gross margins, we think are probably the best type of systems of this type on the market, which is why after extensive research on that market, we acquired a majority in MIMETAS. We're very excited, and we think this will complement our multiomics, spatial biology, structural biology in drug discovery, in particular, drug discovery and development, in a very important way.

It's a high priority for just about every biopharma company. Right.

On slide 9, we touch on a few recent advances in functional proteomics with novel workflows for drug discovery and disease biology launched at the recent International HUPO Conference in Singapore. Again, I will not read every bullet, but we had very significant further advances in this multi-dia method on our timsTOF Ultra for bottom-up proteomics, for plasma proteomics, single-cell proteomics, where we see in that net more peptides and protein groups and also more isoforms, sequence variants, and all the other things that traditional MS-based methods or the affinity methods simply cannot see, but they're functionally very important for better AI frontier models or better drug discovery.

On the right-hand side, our tims Omni continues to be a very successful system in the market with significant orders, and here are new workflows that are really very, very important, one in glycobiology, where with our unique trapped electron-based fragmentation, I won't go into technical details, but it's really crucial to do this at scale, at speed, and in very sensitive manners, and glycobiology is tremendously important, but has been traditionally very difficult to study. Moreover, oligonucleotides and native RNA analysis is another important area, whether mRNA is a drug target or a potential drug, a potential RNA drug, and the instrument can perform outstanding workflows now in this area as well.

We think this bodes well for further rapid adoption in academic medical centers which have good funding, as well as in pharma companies and biotech companies. All right, that about does it for me.

In summary, the third quarter, we achieved significant margin expansion and non-GAAP EPS growth, and our positive booking trends continued. Our BSI organic bookings and BSI backlog are both up mid single-digits percentage year-to-date.

This helps de-risk our fourth quarter and sets us up for meaningful further performance improvements and growth acceleration in fiscal year '27 and beyond. Let me turn the call over to our CFO, Gerald.

Thank you, Frank, and thanks, everyone, for joining us today. I'm pleased to provide more detail on Bruker's third quarter 2026 financial performance, starting on slide 11.

In the third quarter of '26, our results were roughly in line with our expectations on the top line, but meaningfully ahead of our expectations on margins and EPS, largely confirming the benefit of our cost-saving actions, together with a positive mix in the quarter. In the third quarter of 2026, Bruker's reported revenue increased 1.6% to $874 million, with organic revenue growth of 0.7%.

Acquisitions added 1.7% to our top line, while foreign exchange was a 0.6% headwind, resulting in constant exchange rate revenue growth of 2.4% year-over-year. BSI organic revenue declined 0.4% in the third quarter '26, with BSI instrument revenue down mid single digits and BSI aftermarket revenue up high single digits organically year-over-year.

The organic decline in the third quarter '26 instruments revenue was primarily driven by the previously communicated pushouts of semi metrology instruments from the third quarter. Geographically, on a year-over-year organic basis in the third quarter of 2026, European revenue was up low single-digits percentage, Americas revenue was roughly flat, while Asia-Pacific revenue declined in the mid single-digits percentage.

BSI revenues in China were up in the low double-digit percentage in the third quarter 2026, and for our EMEA region, revenue was up over 30%. Our BSI segment order book performance was up organically in the low single-digits percentage year-over-year, driven by strong growth in semi and double-digit growth in US academic government research and China academic government research, partially offset by declines in European and Japanese aca-gov and biopharma in the third quarter, mostly due to quarterly fluctuations.

Third quarter 2026 non-GAAP gross margin increased 120 basis points to 51.3%. Non-GAAP operating margin was 16.3%, up 400 basis points, driven by our cost-saving actions and favorable mix.

We are on track to achieve our $140 million annualized run-rate cost-out target. On a non-GAAP basis, third quarter 2026 diluted EPS was 56 cents, up 24.4% from the 45 cents we posted in the third quarter of '25.

Our non-GAAP effective tax rate was 28.4%, compared to 24.4% in the third quarter of '25, due to unfavorable jurisdictional mix in the third quarter of '26. On a GAAP basis, we reported a diluted loss per share of 81 cents, compared to a GAAP diluted loss per share of 41 cents in the third quarter of '25.

Our third quarter 2026 GAAP results include a non-cash goodwill impairment charge of approximately $175 million related to Bruker Spatial Biology, where US academic government research market conditions have been weak. Weighted average diluted shares outstanding in the third quarter of 2026 were 153.2 million, an increase of 1.2 million shares from the third quarter of '25.

Slide 12 shows Bruker's performance for the year-to-date 2026, which has similar drivers to the third quarter. Turning to slide 13, in the third quarter of 2026, free cash flow improved $151 million year-over-year, driven mainly by higher net income, excluding the non-cash goodwill impairment, and improved working capital.

We continued our debt deleveraging in the quarter, paying down an additional $58 million in debt. Our net leverage ratio was 2.4 times as of September 30th, 2026, and now is below our previously communicated leverage target.

Turning now to slide 15, we're updating our fiscal year '26 financial outlook for currency and reconfirming our prior fiscal year '26 organic revenue growth and non-GAAP EPS guidance. We now expect reported revenue of $3.52 to $3.56 billion, representing reported growth of 2.5% to 3.5% compared to fiscal year '25.

We continue to expect organic revenue growth of 1% to 2%, and contribution from acquisitions of approximately 1.5%. We now expect currency to be approximately neutral to reported revenue for fiscal year '26 after the recent strengthening of the US dollar.

We continue to expect non-GAAP operating margin expansion of 250 to 300 basis points year-over-year, largely driven by our cost-saving actions. On the bottom line, we continue to expect non-GAAP EPS for fiscal year '26 in a range of $2.10 to $2.15, up 15% to 17% compared to fiscal year '25.

Other guidance assumptions are listed on the slide. Our fiscal year '26 ranges have been updated for foreign currency rates as of September 30th, 2026.

Now, some color on the fourth quarter of 2026. We expect fourth quarter organic revenue to grow in the lower mid single-digits percentage year-over-year.

We expect meaningful sequential and year-over-year increases in operating margin and EPS due to higher volume and favorable mix in the fourth quarter, as well as due to the compounding effects from our cost-saving actions. To wrap up, third quarter 2026 was a solid quarter for Bruker, giving us improved confidence in a market recovery in many key market segments and geographies.

Our cost-saving actions are well on track, positioning us for significant margin and profitability improvements in fiscal year '26, and we're driving towards further margin improvement and double-digit EPS growth in 2027. With that, I'd like to turn the call back over to Joe.

Thank you very much.

Thanks, Gerald. We will now begin the Q&A portion of the call.

As a reminder, to allow everyone time for questions, we ask that you limit yourself to one question and one follow-up. Operator?

Hi Frank, Gerald, thanks for taking my questions here. First one on margin improvement, margin expansion this quarter, great to see that, but just wondering, in terms of factors that give you confidence on the step-up in the fourth quarter, it is still sizable, 500 bps sequential.

Just wondering in terms of cost savings that you're seeing and and and recognizing in the quarter in fourth quarter, any gigahertz magnets that are landing in the fourth quarter, aca-gov, and other AI, and the order $20 million order shift that you talked about as well? What are some of the drivers that give you confidence on that on that step-up in margin?

Good morning, Puneet. Thank you for your questions.

In I think, I mean we I think we've significantly de-risked the fourth quarter. By my math, we do no longer need a 500 bps sequential step-up, that was, I think, previously correct.

Now we we need to step up from where we were at 16.3%, and I think we need to step up to the high teens. That seems much more achievable given that it's likely to be about a $1 billion in revenue quarter.

Indeed, the recent US aca-gov order pick-up probably mostly will us benefit us in '27. China aca-gov orders have picked up earlier, and they would begin to help us in Q4.

The semi shifts, some of that goes into Q4, some of that may go into early '27, but that's all good. I think the the margin and and the the revenue, margin, EPS ramp into Q4, yes, never without risk, but we think we're what we're saying about the color there is prudent at this point in time, and but but I think we we this is much much significantly de-risked with this with another strong Q3 and and and obviously the margin performance and EPS performance in particular.

Makes this much more achievable.

Got it. Thanks for clarifying that.

Then on AI, Frank, obviously an important theme for Bruker. You're levered to it multiple ways, uniquely on the semi side and obviously the AI bio discovery as that starts to take shape as companies are investing more in discovery and platforms there.

Is there a way to sort of quantify the contribution today from AI and then how are you thinking about 2027 here for AI overall across the enterprise? Thank you.

Two pieces to that, as you've pointed out, the semiconductor metrology and within our BEST segment at RI, also some contribution to the ASML supply chain, ultimately, although that's still smaller, because that goes into the latest and greatest tools that they are beginning to now get more adopted. That has been quantified.

I think you've written notes on that, others have been written notes on that, I won't jump into that, and I believe the year-to-date order growth in that area has been 30% or higher year-to-date, and again, it also was really strong in Q3 in order performance. That's just humming along, and obviously one of the very strong growth drivers in our broader deep tech area, but particularly in the semi metrology and a little bit in the lithography supply chain.

Bio and chemistry discovery and materials discovery benefits our Chemspeed automation orders, benefits our Scitara software, and more and more, I think it'll also benefit those deep biology 2.0 tools, whatever you want to call it, that, from bottom-up proteomics, of course, to isoforms, to incomplete proteoforms, top-down, glycobiology, spatial biology, and structural biology, I think. There's an excellent article in the Wall Street Journal today where, yeah, taking more shots on goal, meaning on drug targets, is helping a little bit, but it may not lead to the expected breakthroughs of curing all diseases anytime soon, which is optimistic anyway, but, I think unless you feed these frontier models with much, much deeper insights into disease biology and drug targets and mechanisms of action, we're not going to make all that much progress.

There, I think, maybe not uniquely, but more than any other company, I think we're positioned for really providing these deep disease biology tools. That's still not moving the needle so far, but I think that's quite promising for '27, and I think could be seeing a very significant ramp-up in the next few years, whereas people begin to move from scratching the surface with more shots on goal, which is sort of the initial approach, which is fine, to, I think, the much more impactful deeper biology, for which you need our tools.

That was a long answer, I apologize. Oh

no, it's all good. Thanks, Frank.

Mhm.

Hey, thanks. Frank, obviously, a lot of improvement here in end markets.

I'm wondering if you could just kind of give us a state of the various end markets. You've obviously talked a lot about academic picking up, how much of what you're seeing here and now you think is durable.

Then what's going on in pharma? It seems like pharma orders were down both in the EU and I don't know if it's in the US as well, but maybe touch on that as well.

Gladly, Tycho. Thank you.

Aca-gov, nice to see a little bit of order growth in the US, importantly, also in China, that's been going on throughout year-to-date, for several quarters. Japan is relatively weak, it's a smaller part of the total demand now, but it is weak.

Europe was quite very strong in Q3 of last year, '25, and was a bit weaker in aca-gov than in Q3 of 2026. That's how, we're not firing on all cylinders, but more and more.

Year-to-date, I think are the better trends. Any given quarter, these things can fluctuate, and they do, but year-to-date, I think the overall, as we've said, mid single-digit BSI backlog and bookings, I think that kind of is a good predictor of where we might end up in organic revenue growth next year.

Pharma, biopharma also has some fluctuations. I think we had an excellent Q4, Q2, Q3 a bit weaker, Q1 was actually not that strong.

Overall, the pharma, biopharma trends are good. They're not as strong as those who are more in the regulated space of pharma.

They see stronger growth, as we've seen yesterday, for instance. I'm encouraged that in the more capex-heavy drug discovery front end, the trends are good, although there's some quarterly fluctuations, also for automation and software tools.

Okay. That's helpful.

Then what's your latest framing on '27, given mid single-digit bookings growth here, BSI book-to-bill above 1, obviously incremental cost savings look like they'll continue to flow through here. Can you just provide any updated thoughts on '27 at this point?

Not really beyond what we've said already. As when we report probably in early February, report Q4, we'll give guidance, but we put our neck out and feel pretty comfortable, and are very committed to double-digit EPS growth.

Refining that further, it's too early right now. We are seeking more than 100 bps of further operating margin expansion, hopefully more than just 100, not 300 or 250 like 300 this year, but another meaningful step.

From this year still relatively flattish because, for us, it's always that orders kick in six to nine months before the revenue growth kicks in, as you've seen. Then we have this very strong deep tech orders, which have even longer conversion times, but come in at very good margins and with very good order trends.

Anticipating that we will accelerate in organic revenue growth from this year is easy because it's going to be an easy comparison, but nonetheless, that should bring us at least to the lower mid single digits.

Okay. Then just quickly on margins before I hop off, mix contributed 90 bps this quarter.

Can you just unpack where you're seeing the biggest mix benefits?

Hi Tycho, it's Gerald. I'd say we saw some significant mix improvement both in our NMR business, as well as in our optical microscopy business in the quarter, and that's better than what we actually anticipated.

Clearly, we still have good, solid performance in a number of other areas, but I'd highlight those two.

Okay. Thank you.

You're welcome.

Great, thanks. Just wanted to follow up on the margin side.

Big margin step-up here and came in well above what anybody was looking for. You talked about de-risking that 4Q.

Just wanted to know, is there a pull-forward on any of the cost-outs or was this just, you talked about, on Tycho's question, the 90 bps mix? Just anything there from a conservatism or what's embedded in 4Q, cuz your revenue dollar didn't change, just trying to figure out what the difference is there versus your prior expectations for a big 4Q step-up.

Again, Luke, it's Gerald. I would just say with respect to the margin performance for the third quarter, I mentioned we had two more favorable elements on the mix side.

On the cost-saving side, recall that actually most of our cost-saving actions didn't kick in really until the fourth quarter of 2025 historically. We have quite a big step-up in cost-saving improvements in the third quarter of 2026, and that's part of the more significant element here.

I would say, mix was clearly better than we had expected to see even back in Q2.

Okay. Then I guess on the BEST beat that you guys had, continued strength here all year long, can you talk a little bit more about what is driving this?

Is some of the newer energy technologies, like fusion, or is this just trying to think about how much is just pricing given the supply chain constraints, etc.? A

good question. I should observe that BEST was pretty weak last year, sometimes a weaker comparison helps.

Nonetheless, we're very pleased with the BEST order trends, which are even stronger, and we don't break those out because some of our MRI superconducting wire orders, they come sort of every five years and big framework agreements. Very, very strong order growth in the research instrument side, and that is driven, to your question, by ITER and fusion orders that ultimately will go towards fusion energy, certainly fusion energy range research.

There are other high-energy physics and advanced light sources and electron free lasers and similar projects around the world where we just have pretty unique capabilities and unique technology that really play a role, and where the order growth also has been very, very strong. As I said, they're also plugged in a little bit into this ASML lithography supply chain in a small way, but being designed in is a good thing, that's where you want to be into the newest tools.

We're just delighted with that segment, and it also has seen nice margin improvement, it's not just the growth, but the bookings growth is even higher there even though the revenue growth is really quite nice. It's an exciting part of our normally less appreciated deep tech, in addition to the deep tech semiconductor metrology that we've quantified and that you've all had more interest and insights in this year.

Appreciate it, thanks.

Sure, Luke.

Hey guys, good morning. Thank you for taking my question.

As you think about 2027 framing, given all the events that have happened in the last 2 years, how are you approaching the philosophy when rolling all the end markets up? Should we expect a bit more conservatism next year given the jump-off point, or is it full steam ahead with some of the higher-growth businesses like semis?

Just any color on a prudent start point would be helpful.

Subbu, good question. Obviously, guidance coming then in early February.

I'm afraid I might repeat a little bit what I said to Tycho earlier. There is upside, but I think it's also we've all been burned by unexpected events in '25 in particular, right?

There's still a lot of areas are very dynamic, and timing is hard to call. I think looking for double-digit EPS growth, of course you'll want to know how much double-digit, and we're not prepared to say that yet, and greater than 100 bps margin expansion.

I think this lower mid single-digit organic growth range seems reasonable to us, and not overly conservative. I think we're really going to I think get to the more typical Bruker 200, 300 bps above market, that's more of a '28 or '29 thing, hopefully '28.

'27, I think will still be a transition year, but with very significant organic growth improvement compared to this year.

Thank you for that. A follow-up.

Last quarter, you indicated 2/3 of the fourth quarter revenue was covered by backlog. Are you almost fully de-risked at this point?

I'd say pretty much at this stage. We have pretty clear visibility into the backlog for the fourth quarter, and we still have execution-related issues, but other than that, I would say pretty much.

I have about 60% instruments revenue, 40% consumables. Obviously, on consumables and services, you have limited backlog, and on the instruments, you tend to have the backlog, and then it depends on sometimes issues with suppliers, and then also more typically customer site readiness, which at any given quarter, this is not a fourth quarter thing, at any given quarter, could be you've kind of, even if you execute perfectly, just from the customers, it's sort of a plus or minus $20 million uncertainty that you have, because you don't know exactly when they'll be ready to take shipment.

Again, all in, I think we feel, obviously, there was not excessive, but there was more risk in our Q4 ramp previously, and now it's not a shoo-in, it never is, it's a big quarter, but it seems achievable.

Got it. Thank you so much, guys.

Thank you.

Thank you, Subbu.

Great. Thank you for taking my questions.

Maybe on the first one on the margin, I guess for 4Q, do you still expect to see kind of favorable mix impact? Then maybe can you comment on kind of the cost inflation that you've seen in the quarter, and then for 4Q as well?

Hi Lu, it's Gerald. With respect to the fourth quarter, we're pretty comfortable now where we stand.

As I said earlier, we have already put in place cost-saving actions that will impact the fourth quarter, and I think that's going to be favorable. When we look at the rest of our mix, we are expecting an ultra-high-field system into the mix, and that will also help our overall picture.

We do have a stronger performance also in the semi space, which also will help our mix. I think fundamentally, the fourth quarter pieces look pretty solid, I think, for us at this stage.

As I said earlier, cost-saving actions are already in place, it's more about execution on the revenue piece at this stage.

Cost-saving actions are accumulating throughout the year. It's kind of a compounding effect.

Should be even more also visible in Q4,

and

certainly was very visible in Q3.

Got it. Then second question probably on China.

Definitely year-to-date has been pretty strong performance, it seems like the money has flowing into kind of the orders. I'm wondering kind of looking forward in 2027, do you still expect kind of pretty durable bookings growth, and maybe just what do you hear from the customer on the market?

Thank you.

Sure. Revenue earlier in the year was still going down because of weak orders in '25.

I think that has reversed in Q3 with some broad revenue growth, and then year-to-date in China, you're exactly right, our order growth in China for BSI it has been really quite good, and we expect that to continue in Q4. It's hard to read China beyond a few quarters.

In China, sometimes we say, well, you got to finish the quarter to know. I think we have reasonable confidence that Q4 the strength will continue.

Hopefully, that can be extrapolated into '27. We have no reason to believe otherwise, but it's just also more difficult to read China over one- or two-year periods.

We're encouraged. This year, order trends have been very good, expected to continue in Q4, and by the way, also in China aca-gov.

It was not only US aca-gov that was weak, but also China aca-gov, and that has really turned in orders already earlier this year, and continued in Q3.

Hey, good morning, guys. Thank you for taking my questions.

I have one on BSI, and then I'm going to ask another 2027 question. BSI book-to-bill has now exceeded 1 for five consecutive quarters, yet BSI organic revenue remains under pressure, I think you were down 1% year-to-date.

With US academic bookings now double-digit positive, China above 20%, and semiconductor metrology above 30% year-to-date, why aren't we seeing a more meaningful revenue inflection? What gives you confidence that the bookings you've been talking about are going to start to convert in 2027?

That's the first topic. Then more broadly on 2027, given the momentum you've described based on trends over the last few quarters, in a scenario where you're growing, call it 4% to 5% next year, which I think is consistent with your commentary, it seems that momentum continues that BSI would grow something like 3% to 4% and BEST closer to 10.

Again, I'm not asking you to guide, but I just want to make sure there's nothing in my logic that is off. Thank you very much.

Your logic and math are impeccable, as always, Doug. [laughter] So trying to get to all the parts of your question.

BSI book-to-bill, why has it not shown yet in Q3? The biggest part is that semi pushout that we had highlighted when Gerald gave Q3 color on Q3 during our Q2 earnings call, because otherwise semi bookings have been just very strong year-to-date, greater than 30%.

The other part is that the other part that also has longer conversion times is NMR and sometimes related MRI, preclinical MRI, and that certainly felt the impact of 2025 aca-gov weakness in the US and in China. The NMR part until that grows again also takes a little bit longer.

NMR and semi pushout are why you haven't seen it as much yet. You will see, as we're predicting, this all implies BSI organic revenue growth in Q4.

Not saying that the Q4 rate will then therefore be indicative as an exit rate for '27, but it'll probably be closer. Other than that, Yeah, I think other than that, I think your logic isn't something that I would object to or detect a flaw.

This is one of the scenarios that you've just outlined with numbers. I'm not confirming that, but I'm also not contradicting it.

It's one of the scenarios of how it could play out. It's reasonable.

Okay. All right.

Thanks, Frank. I appreciate you indulging me on that.

Thank you. [laughter]

Thank you. Good morning, guys.

I wanted to ask about the new MID segment. Looks like it grew low singles in the quarter.

Can you just talk about what you think is the right ongoing growth rate for this business in the medium term and any moving parts you would call out? I'm not sure if there's any respiratory exposure at ELITech or anything like that.

Just helping us frame that segment would be great.

Good question, Jack. No, we don't have very much respiratory, not since COVID.

That's de minimis for us. It's also one of these specialty diagnostics business that doesn't have that China headwind that you've seen with some others, it's clean in that sense.

Infectious disease diagnostics tools had seen lower growth recently in my clinical microbiology, and continued very nice growth in primarily ELITech-derived sample-to-answer molecular diagnostics. There, just like last year, placements of these Q-line platforms, that's the product name, has been well ahead of business plan, and that then bodes well for consumables acceleration in next year and beyond.

They're also developing some very, very cool new capabilities. We have to get FDA clearance maybe before the end of the year, maybe in Q1, for the WAVE product, which is the antibiotic susceptibility testing for the US.

We're going to go for the US market first, and that will further strengthen our microbiology sepsis testing. By the way, because of faster time to result, can potentially save quite a few lives or shorten ICU times and longer-term health effects, it has an important societal function.

Wrapping up, I think while right now it's a little bit slower, I think this is a high single-digit growth area long term, and it has very, very nice margins.

Great. Thank you for all that.

Gerald, one below-the-line follow-up for you. In the guide, you raised the tax rate assumption from 26.5% to 27.5%.

I was just wondering as a 2027 question, as we look forward, what you think is the right ongoing tax rate for the business and if there are any moving parts that have changed that we should be thinking about? Thanks.

I think generally, our position on tax has been relatively consistent here. We're tracking somewhere in that 27.5% range, and we have been for a period of time.

We have a number of tax planning initiatives, which we won't discuss here, but just fundamentally, we've got a number of initiatives underway that are expected to benefit the tax rate going forward, particularly in '27 and '28. We can talk more about that another time, but just fundamentally, I would just say that the goal for us is to continue to drive that rate down at least 50 basis points on a year-over-year basis in '27, and then consistently thereafter.

That's our target.

Perfect. Thank you.

Yes. Thanks,

Jack.

Hey, good morning. Thank you for taking my questions.

I wanted to go back and build off of maybe a couple that were asked just around US A&G, the order book improvement. I guess how much of the improvement that you're seeing is really easier comparisons from the back half of 2025 versus more tangible improvement in sentiment amongst those customers?

It's both, Kyle. Certainly, the comparison was easier, right?

We all know that. I think the US aca-gov sector still suffers from lack of conviction.

As in the last federal fiscal year, a lot of the funding and budget flush came late. It wasn't linearly spent even though the budget overall wasn't bad, and yeah, now people will begin to look, does this change with a different Congress?

Same president, different Congress, who knows. I'm not saying that US aca-gov is bouncing back, snapping back, but it is getting better, weaker comparisons help, and people are back to, okay, well, we need these new tools.

We really need them to understand disease biology. You really do.

You're just not going to get there with more of the same of what you have already. That's foundational, what you have already, sequencing, etc., but you need much deeper insights to understand.

You all really need it, it's really shown. The people that do have the money, which is in biotech and big pharma, they get these latest and greatest tools.

Also overseas people where they do have the budgets in aca-gov, they're going for these tools, fully appreciating that they need to understand targets and mechanism of action, biology, and off-target effects, all these complexities much, much better if they want to have a better drug discovery and fundamental disease translational approaches. I think this inevitably also then strengthens.

There still is a lot of state and philanthropic and other funding. These days, it's not so much traditionally the Department of Chemistry needing more NMRs or mass specs, now it's the cancer or neurodegeneration or autoimmunity or cardiovascular disease academic medical centers, and they have other sources of funding.

That part is really getting stronger.

Got it. Thank you.

Even just one more sort of conceptual question, but you mentioned during the call that you're below your target leverage range. I guess can you just talk a little bit about how you're thinking about M&A going forward now that you're under your leverage target?

We did some M&A this year. MIMETAS was an important one, and it gets us into a new area in addition to our preclinical imaging, the preclinical humanized organs-on-a-chip model that are in some ways closer to human physiology than animal models are tremendously important.

It wasn't very, very large M&A, you're right. We didn't do any of that this year.

We did a couple of smaller acquisitions that were really very important for the BMiT for infectious disease diagnostics sequencing, including sequencing the metagenome, which also can help sometimes in extreme cases in detecting infections directly from blood without a blood culture, and then some enrichment technology. We did some smaller bolt-ons that were technically very, very important for our BMiT Group, and which I think also have in addition to good market demand, I think and to Jack's question earlier, I think in terms of new solutions that you'll see launched in '27 and '28 in that group, microbiology and molecular diagnostics, I think they'll also outgrow their markets, perhaps quite significantly.

We've done some M&A, we have now again some more capacity for M&A, but we also like EPS accretion, we'll be very disciplined.

Got it. Thank you.

Mhm.

Morning, guys. Thank you.

Frank, on the $20 million in pushed-off revenues, can you just refresh the view on confidence and timing there? Then more broadly, I guess just how are you finding the conversation on timing associated with semi product acceptance, revenue recognition?

Obviously, you're seeing pushback on data center build-outs, that seems like a good build based on last night's results, but then if you read about permits and construction activity, that still seems pretty good. I guess, what would you say about the error bars around timing?

Are they getting wider, narrower, or kind of just staying the same?

All right. Good question, Dan.

I'd say it's kind of staying the same. These big fab projects or within a fab adding additional lines is remarkably on time.

That's one industry that is extremely well-managed. That doesn't mean you cannot have a one-quarter shift or sometimes a two-quarter shift.

That all continues as before, actually, usually you can really plan very well. Things don't get delayed by a year in that industry.

Rev rec is not problematic there. When we ship and install, these systems work.

These are very robust, high-volume manufacturing metrology systems. These are not finicky scientific, they're extremely extreme nano science, but they're very, very robust and high-throughput systems.

Data center build-out in the US, but we'll have to realize the US is only a fraction, not a small fraction, it's an increasing, but still of a smallish fraction compared to what's going on in Japan and in APAC, a little bit in Europe, but it's mostly in China itself, where we can only deliver lower-end systems, but that's booming, and then the rest of APAC, and big build-out in Japan, and, of course, Taiwan and Korea and Singapore are all investing very heavily, so that build-out is, if anything, is accelerating.

Yep. Helpful.

Then just, Gerald, maybe a bookings clarification. Were BSI bookings up during the quarter?

You had said mid singles year-to-date, but the first two quarters of the year were double digits, just trying to square away the 3Q number in order to get to the nine-month range here. Thank you.

I think the bookings performance is low single digit in the third quarter.

Third quarter last year was very, very strong,

actually

I think that's Q3 of '25 and bookings were very strong,

yep.

Yep. It's up year-over-year low single digits, and it's up sequentially in the mid to high single digits compared to Q2 of '26.

It's all good.

It's all moving. The momentum is there, I'd say.

Yes.

Yep. Okay.

Thank you.

You're welcome.

All right. Thanks for taking the question.

Maybe on the previous question on semis, you guys called out nothing's really changed here, are you guys still expecting that business to be around, call it, $300 million to end the year on mid-to-high single-digit growth, 30% EBIT margins, and does that translate to just given the bookings to maybe a mid-teens grower, call it, $400 million business next year? Appreciate the color.

I have a follow-up.

Good question. You may have stumped us slightly.

I think we don't give '27 guidance, we're certainly not giving granularity. Directionally, I can't reproduce all the math that you have in your head right now, but I think the direction is correct.

That business, if anything, would accelerate in revenue growth next year compared to this year, that is also correct, and its order growth has already been very good. We think that will continue into '27, and then beyond '27, we follow what the industry thinks, and the industry hasn't really taken a position on '28, '29 yet, but they're pretty sure that '27, things will continue to hum along with very fast growth rates.

Got it. Okay.

Then, I think you previously called out some potential NIH budget flush in September. Is that what you guys saw that drove the double-digit A&G bookings this quarter?

I guess do you expect that to flow through, given the six- to nine-month conversion time, for A&G to grow next year, or how should we kind of juggle just the strong double-digit bookings and the forward thinking? Appreciate it.

Right, Albert, I think the double-digit bookings in Q3 had a lot to do with a weak Q3 of last year, and maybe some incremental orders that came, but there was a budget flush at NIH, for sure, that's well-documented. Most of that, we think, will help us with Q4 orders, and perhaps some of that will still take a little bit of time and go into Q1 orders.

The budget flush was not significantly responsible for improved bookings in Q3. I think it's just there's a lot of pent-up demand.

People need the newer tools, at some point, they just do whatever it takes within their university or academic medical center or research hospital to get the new tools, and they're getting used to this slightly less predictable federal funding, and they're just dealing with this new and they're settling into that, and are now kind of back to where they're placing orders for what they really need. Then the budget flush that did take place probably for us primarily will help Q4 and Q1 bookings.

Perfect. Thanks so much.

Thank you for joining us today. Bruker's leadership team looks forward to meeting with you at an event or speaking with you directly during the fourth quarter.

Feel free to reach out to me to arrange any follow-ups. Have a good day.