By Sneha S K
May 5 (Reuters) – Lab equipment maker Waters raised its annual profit forecast on Tuesday after beating quarterly estimates, driven by robust demand for drug development tools and the strong performance of its biosciences and diagnostics unit, acquired last year.
Shares of the company were up 12.7% at $340.13.
Waters supplies lab equipment and technology across the world, with the majority of its revenue coming from biopharma clients who use its tools for research and drug development.
The company reported first-quarter revenue of $1.27 billion, beating estimates of $1.20 billion, according to data compiled by LSEG. This reflects $520 million in revenue from the biosciences and diagnostic solutions unit it bought from Becton Dickinson last year.
The acquisition helped broaden Waters’ reach in clinical and diagnostic applications, as the unit manufactures products that help detect infectious diseases and cancer.
The results are a strong proof point and should serve as a major clearing event for those still skeptical of the deal, Jefferies analyst Tycho Peterson said.
The Milford, Massachusetts-based company raised its 2026 adjusted profit per share forecast to a range of $14.40 to $14.60, compared with $14.30 to $14.50 per share previously. Analysts, on average, were expecting a profit of $14.38 per share.
Waters’ CFO Amol Chaubal said the company has a range of operational initiatives to fully offset elevated freight, raw materials and component costs due to the Middle East conflict for the rest of the year.
Waters also raised its full-year organic revenue forecast to a range of $3.37 billion to $3.42 billion, with the acquired Becton unit adding about $3.04 billion to its estimated annual revenue.
“As we look ahead, we are raising our guidance to reflect the increased momentum we are seeing across our businesses,” said CEO Udit Batra, underscoring strength in the biosciences and advanced diagnostics division.
The company also said it is in advance stages of implementing its restructuring plan, with savings expected from the third quarter.
It reported quarterly profit of $2.70 per share, beating analysts’ average estimate of $2.34 per share.
(Reporting by Puyaan Singh and Sneha S K in Bengaluru; Editing by Diti Pujara)
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