Hologic, Inc.

Hologic reported third-quarter fiscal 2025 revenue of $1.024 billion, up 0.4% year over year, and non-GAAP EPS of $1.08, up 1.9% year over year. Non-GAAP gross margin was 60.3%, down 80 basis points, and non-GAAP operating margin was 30.1%, down 110 basis points. Segment revenue included Diagnostics at $448.9 million (+0.9%, or +2.9% organically excluding COVID), Breast Health at $365.2 million (-5.8%, or -10.8% organically excluding Endomag and SSI), Surgical at $178.4 million (+6.3%, or +1.2% organically excluding Gynesonics), and Skeletal at $31.3 million (+62.1%). Cash from operations was $343 million, with $1.88 billion in cash and short-term investments and net leverage of 0.6x. For Q4, management guided to revenue of $1.03 billion to $1.04 billion and non-GAAP EPS of $1.09 to $1.12. For the full year, guidance was raised to revenue of $4.081 billion to $4.091 billion and non-GAAP EPS of $4.23 to $4.26. Management also said gross margin and operating margin for the full year remain expected in the low 60s and low 30s, respectively, and tariff expense is expected to be about $8 million in Q4 and $10 million to $12 million per quarter in fiscal 2026.

Steve MacMillan struck a confident but measured tone, saying the company had moved past recent “speed bumps” and that Q3 showed progress toward higher growth and improving women’s health outcomes. He emphasized Breast Health stabilization, new AI-enabled products like Genius AI Detection PRO, and the long-term opportunity from Endomag and the upcoming Envision launch. He also said the company now believes it is well positioned to return to solid mid-single-digit organic revenue growth next year and across the strategic plan horizon.

Karleen Oberton focused on the clean beat versus guidance, the margin profile, and the updated outlook. She said Q3 gross margin was 60.3% and operating margin was 30.1%, with margin pressure from mix, Endomag and Gynesonics dilution, and about $1.4 million of tariff expense in cost of goods sold. She highlighted strong cash generation of $343 million in operating cash flow, $1.88 billion in cash and short-term investments, and a 0.6x net leverage ratio, and noted the company refinanced its credit agreement earlier in the month. She also said the tariff burden has been reduced from a prior estimate of $20 million to $25 million per quarter to $10 million to $12 million per quarter, and that the full-year gross and operating margin outlook stays in the low 60s and low 30s.

Analysts pressed on FY26 momentum, Breast Health visibility, tariffs, China, diagnostics growth, and capital allocation. Management said FY26 should still show mid-single-digit growth, but first-half headwinds from China and reduced HIV funding in Africa will still be a factor; they also said Fluoroscan discontinuation will modestly affect growth comparisons. On Breast Health, management said the commercial reorganization is settling in well, gantry replacement should keep improving, and Envision becomes more meaningful later in 2026. On capital allocation, Steve MacMillan said there was no large M&A deal being set up and that the company will continue balancing buybacks and M&A from a position of strength.