The Cooper Companies, Inc.

Second-quarter consolidated revenue was $1.08 billion, up 8% year over year and 5% organically. Gross margin was 68.1%, roughly flat year over year, while operating income rose 19% and operating margin reached 27.5%. Non-GAAP EPS increased 26% to $1.21, with roughly 196 million average shares outstanding. Free cash flow was $96 million, net debt was reduced to $2.3 billion, and $13 million of stock was repurchased. For fiscal 2026, revenue is now expected to be roughly $4.28 billion to $4.32 billion, with organic growth of 3.5% to 4.5%; CooperVision is expected at roughly $2.88 billion to $2.91 billion, CooperSurgical at roughly $1.4 billion to $1.41 billion, EPS is maintained at $4.58 to $4.66, and free cash flow is raised to roughly $650 million excluding litigation payouts. For Q3, management expects gross margin of approximately 66%, and said tariffs are assumed at about $22 million this fiscal year, with potential refunds of up to $15 million not included in guidance.

Al White framed the quarter as evidence of steady execution, citing record revenue and earnings, operating leverage, and strong cash generation. Strategically, he emphasized two major themes: a serious review of CooperSurgical to maximize shareholder value, and a capital allocation reset that should make buybacks more active going forward. His tone was confident but practical, especially on Asia Pac, where he repeatedly said the weakness is regional and temporary, not structural across the broader business.

Brian Andrews highlighted the financial quality of the quarter: gross margin was 68.1%, operating expenses rose only 1%, operating income increased 19%, and non-GAAP EPS reached $1.21. He said free cash flow was $96 million, net debt fell to $2.3 billion, and the company repurchased $13 million of stock. On guidance, he said fiscal 2026 revenue is now $4.28 billion to $4.32 billion, EPS remains $4.58 to $4.66, interest expense should be about $85 million, and the tax rate about 15.5%; he also raised free cash flow guidance to roughly $650 million excluding litigation payouts, while noting gross margins should decline year over year and be about 66% in Q3 due to FX, tariffs, freight, and lower production tied to inventory reduction efforts.

Analysts pressed on the Q3 Asia Pac decline, asking whether the weakness was driven more by market demand or Cooper’s own hydrogel rationalization. Management said the primary issue is market softness, especially in Japan and China, plus some wear-behavior shifts and more e-commerce activity, while also noting the legacy hydrogel transition will likely continue into 2027. Questions also focused on the strategic review: management said there is meaningful interest in both the whole CooperSurgical business and pieces of it, but current focus is on a whole-business transaction, with litigation having slowed the process but now resolved.