Highlights

  • Veralto grew third-quarter 2026 sales 7.5% to US$1,509 million, with core sales up 5.1% on a non-GAAP basis.
  • Adjusted Diluted Earnings per Share climbed 19.2% to US$1.18, while GAAP diluted earnings per share reached US$1.03.
  • Free Cash Flow increased about 18% to US$304 million, and Operating Cash Flow rose to US$323 million.
  • The company raised full-year 2026 adjusted diluted earnings per share guidance to between US$4.49 and US$4.52.

Stronger water treatment Demand and a run of bolt-on acquisitions lifted third-quarter growth at Veralto Corporation (NYSE:VLTO), prompting the water quality and product identification group to raise its 2026 outlook on 29 October 2026. Sales for the quarter ended 2 October 2026 rose 7.5% to US$1,509 million from US$1,404 million, with core sales up 5.1%, acquisitions adding 2.3 points and currency a 0.1-point drag.

President and Chief Executive Jennifer L. Honeycutt described a strong quarter, with growth across the business, healthy demand in both segments and good operating leverage.

Water Treatment Leads Segment Momentum

Water Quality reported sales growth of 9.8%, including core growth of 6.4%. Management cited double-digit core growth in water treatment, steady demand for water analytics and favorable North American industrial trends, alongside opportunities linked to digital infrastructure Investment and water reuse.

Product Quality and Innovation sales rose 3.9%, with core sales up 3.2%. Core growth accelerated from the previous quarter, supported by steady marking and coding demand and faster growth in packaging and color.

Across the first nine months of 2026, sales reached US$4,405 million, compared with US$4,107 million in the same period of 2025.

Margins Widen as Cost Program Delivers

The adjusted operating Margin expanded about 170 basis points to 25.6%, while the GAAP Operating Margin was 19.7%, down from 23.2%. GAAP results included restructuring linked to the 2026 Cost Optimization Program, strategic initiative costs, Acquisition intangible amortization and a US$39 million pretax reduction of a tax indemnification asset.

GAAP net earnings rose to US$253 million, or US$1.03 per diluted share, from US$239 million. Adjusted net earnings were US$290 million. Operating cash flow of US$323 million, less capital expenditures of US$19 million, produced free cash flow of US$304 million, bringing the trailing twelve-month total to US$1,093 million, an 18.8% margin on sales. Veralto now expects full-year savings of US$10 million to US$15 million from the cost program. Interest expense was US$25 million in the quarter.

Acquisitions, Buybacks and the Updated Outlook

As of 28 October 2026, Veralto had deployed about US$1.1 billion on four bolt-on acquisitions this year: In-Situ, GlobalVision, Alfaa UV and Cleanwater1, the last of which closed on 5 October 2026. It also repurchased US$550 million of stock, equal to 2.4% of shares outstanding as of 13 February 2026.

For Q4 2026, management expects core sales growth of 5.5% to 6.5%, an adjusted operating margin of about 24.5% and adjusted diluted earnings per share of US$1.13 to US$1.16. Full-year guidance now calls for core sales growth of 4.2% to 4.5%, adjusted margin expansion of about 50 basis points, adjusted diluted earnings per share of US$4.49 to US$4.52, up from US$4.35 to US$4.43, and free cash flow conversion above 105% of GAAP net earnings. Shares closed at US$111.10 on 30 October 2026, up 6.77% on the day, giving a market Capitalization of about US$27.09 billion.