Q2 2024 Revvity Inc Earnings Call

Hello and welcome to the Q2 2024 Revity Earnings Conference call. My name is Elliot and I'll be coordinating your call today. If you would like to register a question during today's event, please press star followed by one on your telephone keypad.

Operator: If you would like to register a question during today's event, please press star followed by one on your telephone keypad. And I'd like to hand over to Steve Willoughby, Senior Vice President, Investor Relations. Please go ahead.

Unknown Executive: Donnelly, I have Steve Willoughby, Senior Vice President and Best Relations.

Stephen Willoughby: Thank you, operator.

Stephen Barr Willoughby: Thank you, operator. Good morning, everyone, and welcome to Revity's second quarter 2024 earnings conference call. On the call with me today are Prahlad Singh, our President and Chief Executive Officer, and Max Krakowiak, our Senior Vice President and Chief Financial Officer. I would like to remind you of the safe harbor statements outlined in our press release issued earlier this morning and also those in our SEC filing. Statements or comments made on this call may be forward-looking statements, which may include but may not be limited to financial projections and other statements of the company's plans, objectives, expectations, or intentions.

Prahlad Singh: Good morning, everyone, and welcome to Rev. 2nd quarter, 2024 earnings conference call. On the call with me today are Prahlad Singh, our President and Chief Executive Officer.

Prahlad Singh: I would like to remind you of the safe harbor statements outlined in our press release issued earlier this morning, and also those in our SEC filings. Statements are comments made on this call may be forward-looking statements, which may include, but may not be limited to financial projections and other statements of the company's plans, objectives, expectations, or intentions. The company's actual results may differ significantly from those projected or suggested due to a variety of factors, which are discussed in detail in our SEC filings. Any forward-looking statements made today represent our views as of today. We disclaim any obligation to update these forward-looking statements in the future, even if our estimates change.

Stephen Barr Willoughby: The company's actual results may differ significantly from those projected or suggested due to a variety of factors which are discussed in detail in our SEC filing. Any forward-looking statements made today represent our views as of today. We disclaim any obligation to update these forward-looking statements in the future, even if our estimates change. Therefore, you should not rely on any of today's statements as representing our views as of any date after today.

Speaker Change: I would like to remind you of the safe Harbor statements outlined in our press release issued earlier. This morning and also those in our SEC filings statements or comments made on this call may be forward looking statements, which may include but may not be limited to financial projections and other statements of the company's plans objectives expectations or intentions.

The company's actual results may differ significantly from those projected or suggested due to a variety of factors, which are discussed in detail in our SEC filings.

Any forward looking statements made today represent our views as of today, we disclaim any obligation to update these forward looking statements in the future even if our estimates change. So you should not rely on any of todays statements as representing our views as of any date after today.

Prahlad Singh: So you should not rely on any of today's statements as representing our views as of any date after today.

Prahlad Singh: During this call, we will be referring to certain non-GAAP financial measures. A reconciliation in the measures we plan to use during this call to the most directly comparable gap measures is available as an attachment to our earnings press release.

Stephen Barr Willoughby: During this call, we will be referring to certain non-GAAP financial measures. A reconciliation of the measures we plan to use during this call to the most directly comparable GAAP measures is available as an attachment to our earnings press release. I'll now turn it over to our President and Chief Executive Officer, Prahlad Singh.

During this call we will be referring to certain non-GAAP financial measures a reconciliation of the measures we plan to use during this call to the most directly comparable GAAP measures is available as an attachment to our earnings press release.

Prahlad Singh: I'll now turn it over to our President and Chief Executive Officer, Prahlad Singh.

Speaker Change: I'll now turn it over to our President and Chief Executive Officer prolonged thing for a lot.

Prahlad Singh: Prahlad. Thank you, Steve, and good morning, everyone. The power and potential of Rev. 1 displayed during the 2nd quarter, which allowed us to exceed our financial expectations for the quarter despite continued market uncertainty, persisting among some in the farmer biotech market. While we had count reductions, site consolidations, and other cost-cutting measures we have seen from these customers since mid last year continued. We were more than able to offset the impact of these actions through meaningful strength in our other businesses. Rev. 1's uniqueness enabled us to overcome these challenges and continued to post leading financial performance.

Prahlad R. Singh: Thank you, Steve, and good morning, everyone. The power and potential of Revity won't be on display during the second quarter, which allowed us to exceed our financial expectations for the quarter despite continued market uncertainty persisting among some in the pharma biotech market. While we had count reductions, site consolidations, and other cost-cutting measures we have seen from these customers since mid last year continued, we were more than able to offset the impact of these actions through meaningful strength in our other business.

Speaker Change: Thank you, Steve and good morning, everyone.

Speaker Change: The power and potential of relative on display during the second quarter.

Speaker Change: Allowed us to exceed our financial expectations for the quarter. Despite continued market uncertainty.

Speaker Change: Listing amongst some in the pharma biotech market.

Speaker Change: While we head count reductions site consolidations and other cost cutting measures we have seen from these customers since mid last year continue.

Speaker Change: There are more than able to offset the impact of these actions through meaningful strength in other businesses.

Prahlad R. Singh: Revvity's uniqueness enabled us to overcome these challenges and continue to post leading financial performance. I expect this differentiation to continue even as pharma spending eventually normalizes. Maxwell will provide more specifics, but I wanted to briefly touch on a few key points as it pertains to our recent financial performance. Our negative 1% organic revenue decline was at the upper end of our expectations for the quarter.

Speaker Change: <unk> uniqueness enabled us to overcome these challenges and continue to post leading financial performance.

Prahlad Singh: I expect this differentiation to continue even as farmers' spending eventually normalizes.

Speaker Change: I expect this differentiation to continue even as pharma spending eventually normalizes.

Prahlad Singh: Max will provide more specifics, but I wanted to briefly touch on a few key points as it pertains to our recent financial performance. Our negative 1% organic revenue decline was at the upper end of our expectations for the quarter. Our customers are continuing to work through temporary cyclical pressures with their pre-clinical spending, and I'm confident in the eventual return to a more normalized environment like we've seen over the last two decades. We had fantastic performance in the number of other areas of the business in the quarter, which should continue over the remainder of the year, specifically within our signals software and diagnostics franchises, both of which are somewhat unique to Gravity compared to our general opinion.

Max: Max will provide more specifics, but I wanted to briefly touch on a few key points.

Max: As it pertains to our recent financial performance.

Max: Our negative 1% organic revenue decline was at the upper end of our expectations for the quarter.

Prahlad R. Singh: Our customers are continuing to work through temporary cyclical pressures with their preclinical spending, and I'm confident in the eventual return to a more normalized environment, like we've seen over the last two decades. We had fantastic performance in a number of other areas of the business in the quarter, which should continue over the remainder of the year, specifically within our signals, software, and diagnostics franchises, both of which are somewhat unique to Revity compared to our general peer group.

Max: Our customers are continuing to work through temporary cyclical pressures that they are preclinical spending and I'm confident in the eventual return to a more normalized environment.

Max: Like we've seen over the last two decades.

Max: We had fantastic performance in a number of other areas of the business in the quarter.

Max: Which should continue over the remainder of the year, specifically within our signals software and diagnostics franchises.

Max: Both of which are somewhat unique to diabetes compared to our general peer group.

Prahlad Singh: Group. We also continue to tightly manage spending, which resulted in 29% adjusted operating margins in the quarter, up significantly from the first quarter. These good top line results combined with our strong margin performance led to adjusted EPS of $1.22, which was meaningfully above our expectations. In addition to the strong PNL performance, we continue to show great progress on managing our operations, leading to another quarter of excellent cash generation. We had over 100% free cash flow conversion of our adjusted net income for the third consecutive quarter, which brings our free cash flow generated so far this year to approximately $300 million.

Prahlad R. Singh: We also continue to tightly manage spending, which resulted in 29% adjusted operating margins in the quarter, up significantly from the first quarter. These good top-line results, combined with our strong margin performance, led to adjusted EPS of $1.22, which was meaningfully above our expectations. In addition to the strong P&L performance, we continue to show great progress in managing our operations, leading to another quarter of excellent cash generation. We had over 100% free cash flow conversion of our adjusted net income for the third consecutive quarter, which brings our free cash flow generated so far this year to approximately $300 million.

Max: We also continued to tightly manage spending.

Max: This resulted in 29% adjusted operating margins in the quarter up significantly from the first quarter.

Max: These good topline results combined with our strong margin performance led to adjusted EPS of $1, 22, which was meaningfully above our expectations.

Max: In addition to the strong P&L performance, we continued to show great progress on managing our operations.

Max: Leading to another quarter of excellent cash generation.

Max: We had over 100% free cash flow conversion of adjusted net income for the third consecutive quarter Mitch.

Mitch: This brings our free cash flow generated so far this year to approximately $300 million.

Prahlad Singh: In addition to our robust cash generation, I'm happy to report we also received nearly $150 million of additional inflows that were owed to us related to the divestiture of the Perkin Analytical and Enterprise Services business. Given we expect this strong year-to-date performance to continue into the second half of the year, and that we do not believe the market is currently appreciating either our recent relative outperformance or the significant potential still in front of us, we intend to use our healthy balance sheet to more aggressively repurchase shares over the remainder of the year. We believe this represents a tremendous long-term value creation opportunity for our shareholders, which will not exist forever.

Prahlad R. Singh: In addition to our robust cash generation, I'm happy to report we also received nearly $150 million of additional inflows that were owed to us related to the divestiture of the Perkin-Elmer analytical and enterprise services business. Given we expect this strong year-to-date performance to continue into the second half of the year and that we do not believe the market is currently appreciating either our recent relative outperformance or the significant potential still in front of us.

Mitch: In addition to our robust cash generation I'm happy to report, we also received nearly $150 million of additional inflows.

Mitch: That to us related to the divestiture of the Perkin Elmer analytical and enterprise services business.

Mitch: Yeah.

Mitch: Given we expect this strong year to date performance to continue into the second half of the year.

Mitch: And that we do not believe the market is currently appreciating.

Mitch: Recent relative outperformance are the significant potential still in front of us.

Prahlad R. Singh: We intend to use our healthy balance sheet to more aggressively repurchase shares over the remainder of the year. We believe this represents a tremendous long-term value creation opportunity for our shareholders, which will not exist forever. We currently have roughly $330 million remaining on our existing buyback authorization, which we will look to opportunistically capitalize on.

Mitch: We intend to use our healthy balance sheet to more aggressively repurchase shares over the remainder of the year.

Mitch: We believe this represents a tremendous long term value creation opportunity for our shareholders, which will not exist forever.

Prahlad Singh: We currently have roughly $330 million remaining on our existing buyback authorization, which we will look to opportunistically capitalize on. Our operating margin performance and cash flow generation so far this year are both great examples of the company executing at a very high level. It is this determined ability to strongly execute in our key focus areas that will also contribute to our differentiated performance in the years to come.

Mitch: We currently have roughly $330 million remaining on our existing buyback authorization.

Mitch: Which we will look to opportunistically capitalize on.

Prahlad R. Singh: Our operating margin performance and cash flow generation so far this year are both great examples of the company executing at a very high level. It is this determined ability to strongly execute in our key focus areas that will also contribute to our differentiated performance in the years to come. Now moving on to other highlights in the quarter, it was great to see how we continue to lead with innovation for our customers.

Mitch: Our operating margin performance and cash flow generation. So far this year are both great. Examples of the company executing at a very high level.

Mitch: It is this determined ability to strongly execute in our key focus areas.

Mitch: It will also contribute to our differentiated performance in the years to come.

Prahlad Singh: Now moving on to other highlights in the quarter, it was great to see how we continue to lead with innovation for our customers. In late April, we launched the more highly automated AP-2400 workflow in our latent TB testing business. This new offering, which we expect to receive FDA clearance later this quarter, has launched in Europe and will be launching in the U.S. in China upon receiving regulatory clearance. We anticipate that the increased automation and decreased hands-on time for our lab customers, combined with the superior sensitivity and specificity, should lead to improved competitiveness for us in the IGRA latent TB testing market globally.

Mitch: Now moving onto other highlights in the quarter. It was great to see how we continue to lead with innovation for our customers.

Prahlad R. Singh: In late April, we launched the more highly automated AP 2400 workflow in our latent TB testing business. This new offering, which we expect to receive FDA clearance later this quarter, has launched in Europe and will be launched in the U.S. and China upon receiving regulatory clearance. We anticipate that the increased automation and decreased hands-on time for our lab customers, combined with the superior sensitivity and specificity of a T-spot assay, should lead to improved competitiveness for us in the IGRA latent TB testing market globally. This is of particular importance in the U.S., which is by far the largest market in the world for latent TB tests.

Mitch: In late April we launched the more highly automated AP <unk> 400 workflow in a latent TB testing business.

Mitch: This new offering, which we expect to receive FDA clearance later this quarter has launched in Europe, and we'll be launching in the U S and China upon receiving regulatory clearance.

Mitch: Yes.

Mitch: We anticipate that the increased automation and decreased depends on time for our lab customers.

Mitch: Combined with the superior sensitivity and specificity of our T spot assay.

Mitch: Should lead to improved competitiveness for us <unk>.

Mitch: <unk> latent TB testing market globally.

Prahlad Singh: This is of particular importance in the US, which is by far the largest market in the world for latent TB testing. As customers will now be able to have the latent TB tests they really want with the level of automation they need.

Mitch: This is of particular importance in the U S.

Mitch: Which is by far the largest market in the world for latent TB testing.

Prahlad R. Singh: As customers will now be able to have the latent TB test they really want, with the level of automation they need. It was also great to see at the recent World Health Assembly in Geneva that a new resolution passed by all 194 countries recommends that newborn screening programs be established in every single country. With this key resolution being adopted, additional government agencies, such as the World Bank and other federal governments, will now consider providing funding for newborn screening.

Mitch: As customers will now be able to have the latent TB test they really want.

Mitch: With the level of automation they need.

Prahlad Singh: It was also great to see at the recent World Health Assembly in Geneva that a new resolution passed by all 194 countries recommends that newborn screening programs be established in every single country. With this key resolution being adopted, additional government agencies such as the World Bank and other federal governments will now consider providing funding for newborn screening. Additionally, a new World Health Organization working group has been created focused on developing guidance to drive the adoption of newborn screening to cover more of the approximately 70% of babies around the world who go untested at birth today.

It was also great to see at the recent World Health Assembly in Geneva that a new resolution passed by all 194 countries recommends that newborn screening programs.

Mitch: Tablets in every single country.

Mitch: With this key resolution being adopted additional government agencies, such as the World Bank and other federal governments.

Speaker Change: We will now consider providing funding for newborn screening.

Prahlad R. Singh: Additionally, a new World Health Organization working group has been created, focused on developing guidance to drive the adoption of newborn screening to cover more of the approximately 70% of babies around the world who go untested at birth today.

Speaker Change: Additionally, our new World Health organization working group has been created focused on developing guidance to drive the adoption of newborn screening to cover more of the approximately 70% of babies around the world who go untested at bought today.

Prahlad Singh: We have also continued to make good progress in adopting new technologies, including AI, to further streamline our operations and improve our product offerings. A few examples of this are how we are now using an AI-based tool to drive improved collections from our customers. We can now instantaneously engage with multiple customers in any language, identify why an invoice has not been paid based on the customer's response, and flag the concern to the appropriate internal team for resolution. Just 90 days ago, this same process would have required a person speaking a specific language to either personally email or call a customer, have a conversation, take notes, investigate internally, and to follow up with the customer.

Prahlad R. Singh: We have also continued to make good progress in adopting new technology, including AI, to further streamline our operations and improve our product offer. A few examples of this are how we are now using an AI-based tool to drive improved collections from our customers. We can now instantaneously engage with multiple customers in any language, identify why an invoice has not been paid based on the customer's response, and flag the concern to the appropriate internal team for resolution.

Speaker Change: We have also continued to make good progress in adopting new technologies.

Speaker Change: <unk> AI.

Speaker Change: To further streamline our operations and improve our product offerings.

Speaker Change: A few examples of this are how we are now using an AI based tool to drive improved collections from our customers.

Speaker Change: We cannot instantaneously engaged with multiple customers in any language.

Speaker Change: <unk> and invoice has not been paid based on the customers' response.

Speaker Change: And flagged a concern to the appropriate internal team for resolution.

Prahlad R. Singh: Just 90 days ago, this same process would have required a person speaking a specific language to either personally email or call a customer, have a conversation, take notes, investigate internally, and follow up with the cuts. Obviously, a much more manual and time-consuming process, given a high volume of predominantly consumable-related invoices.

Speaker Change: Just 90 days ago. This same process would have required a person speaking of specific language.

To either personally E mail or call a customer.

Speaker Change: Have a conversation.

Speaker Change: Take notes.

Speaker Change: Investigate internally and to follow up with the customer.

Prahlad Singh: Obviously, a much more manual and time-consuming process given a high volume of predominantly consumable-related invoices. We expect to broaden the use of this system across the entire company in the coming months. With our customers, we are building on our past efforts in machine learning to adapt generative artificial intelligence into more of our offerings themselves. Since the beginning of the year, we have been using AI to support the design and sourcing of new materials used in the development of our life science, the agent offerings. With this information, we can develop more complex biological structures more quickly using new and different materials than in the past.

Speaker Change: Obviously, a much more manual and time consuming process, given a high volume of predominantly consumables related invoices.

Prahlad R. Singh: We expect to broaden the use of this system across the entire company in the coming months. With our customers, we are building on our past efforts in machine learning to integrate generative artificial intelligence into more of our offerings. Since the beginning of the year, we have been using AI to support the design and sourcing of new materials used in the development of our life science reagent offering. With this information, we can develop more complex biological structures more quickly using new and different materials than in the past.

Speaker Change: We expect to broaden the use of this system across the entire company in the coming months.

Speaker Change: With our customers we are building on our past efforts and machine learning to adapt generated artificial intelligence into more of our offerings themselves.

Speaker Change: Since the beginning of the or we have been using AI to support the design and sourcing of new materials used in the development of our life science reagent offerings.

Speaker Change: With this information we can develop more complex biological structures more quickly using new and different materials than in the past.

Prahlad Singh: We have also recently been using AlphaFold to validate data from some of our high content screening offerings in a key project looking to uncover new insights on the GLP one risk. Scepter. These findings have recently been submitted to a key scientific journal for publication.

Prahlad R. Singh: We have also recently been using AlphaFold to validate data from some of our high-content screening offerings in a key project looking to uncover new insights on the GLP-1 receptor. These findings have recently been submitted to a key scientific journal for publication. I look forward to sharing more details on how we are using AI in our R&D and building it into our products themselves at an upcoming Investor Day in November. As for our upcoming Investor Day on November 21st, we are preparing what should be a great day to get up close and personal with Revity. Attendees will better understand who we are, the impact we are having on customers and patients, and how we plan to accomplish our key goals over the It will also be a great opportunity to see BioLegends operations and the beautiful campus in San Diego. So I hope you join us either in person or virtually.

Speaker Change: We have also recently been using alpha fold to validate data from some of our high content screening offerings.

Speaker Change: A key project looking to uncover new insights on the G. L. P. One receptor.

Speaker Change: These findings have recently been submitted to our key scientific journal for publication.

Prahlad Singh: I look forward to sharing more details on how we are using AI in our R&D and building it into our products themselves at an upcoming Investor Day in November.

Speaker Change: I look forward to sharing more details on how we are using AI in our R&D and.

Speaker Change: And building it into our products themselves.

Speaker Change: At our upcoming Investor day in November.

Prahlad Singh: As it pertains to our upcoming Investor Day on November 21st, we are preparing what should be a great day to get up close and personal with Revvity. Attendees will better understand who we are, the impact we are having on customers and patients, and how we plan to accomplish our key goals over the coming years. It will also be a great opportunity to see bio-ledges operations and beautiful campus in San Diego. So I hope you join us either in person or virtually.

Speaker Change: As it pertains to our upcoming Investor day on November 21st.

Speaker Change: We are preparing what should be a great day to get up close and personal with gravity.

Speaker Change: Attendees will better understand who we are.

Speaker Change: The impact, we're having on customers and patients.

Speaker Change: And how we plan to accomplish our key goals over the coming years.

Speaker Change: It will also be a great opportunity to see biologics operations and beautiful campus in San Diego.

Speaker Change: So I hope you join us either in person or virtually.

Prahlad Singh: Finally, I wanted to share that we continue to have a keen focus on not only what we are doing for the advancement of science and diagnosis of disease, but also how we are doing it. These efforts were recently recognized by the ESG rating agency MSCI, who increased our ESG rating to double A from single A. We remain active on a number of fronts to increase our sustainability in our operations, R&D, and logistics, which will continue. But it was great to see our progress so far, resulting in an improved and now upper-tier rating from one of the most prominent ESG rating agencies in the world.

Prahlad R. Singh: Finally, I wanted to share that we continue to have a keen focus on not only what we are doing for the advancement of science and diagnosis of disease, but also how we are doing. These efforts were recently recognized by the ESG Rating Agency, MSCI, who increased our ESG rating to double A from single A. We remain active on a number of fronts to increase our sustainability in our operations, R&D, and logistics, which will continue.

Speaker Change: Finally, I wanted to share that we continue to have a keen focus on not only what we're doing for the advancement of science and diagnosis of disease.

Speaker Change: But also how we are doing it.

Speaker Change: These efforts were recently recognized by the ESG rating agency MSCI.

Speaker Change: Who increased our ESG rating to double aid from single a.

Speaker Change: We remain active on a number of fronts to increase our sustainability and our operations R&D and logistics.

Speaker Change: Which will continue.

Prahlad R. Singh: But it was great to see our progress so far resulting in an improved and now an upper-tier rating from one of the most prominent ESG rating agencies in the world. So, in closing, before turning it over to Max,

But it was great to see our progress so far resulting in an improved and now upper tier rating from one of the most prominent ESG rating agencies in the world.

Prahlad Singh: So, in closing, before turning it over to Max, we had a very good second quarter on many fronts. From our top line to margins to our cash flow generation, they were all strong and reflective of our organization's commitment to successful execution as we navigate this evolving and market environment. These results put us on a good trajectory for the year and allow us to raise our earnings expectations overall. While it is uncertain at this point as to when farmer spending will return to a normal environment, we are optimistic that the worst is behind us as the long-term potential of our business remains bright.

Max: So in closing before turning it over to Max.

Prahlad R. Singh: We had a very good second quarter on many fronts, from our top line to margins to our cash flow generation. They were all strong and reflective of our organization's commitment to successful execution as we navigate this evolving and market environment. These results put us on a good trajectory for the year and allow us to raise our earnings expectations overall. While it is uncertain at this point as to when pharma spending will return to a normal environment, we are optimistic that the worst is behind us, as the long-term potential of our business remains bright. With that, I will now turn the call over to Max.

Max: <unk> had a very good second quarter on many fronts.

Max: From a top line to margins to our cash flow generation.

Max: They were all strong and reflective of our organization's commitment to successful execution.

Max: As we navigate this evolving end market environment.

Max: These results put us on a good trajectory for the year and allow us to raise our earnings expectations overall.

Max: While it is uncertain at this point as to when farmer spending will return to a normal environment.

Max: We are optimistic that the worst is behind us.

Max: As the long term potential of our business remains bright.

Maxwell Krakowiak: With that, I will now turn the call over to Max.

Max: With that I will now turn the call over to Max.

Maxwell Krakowiak: Thanks Prahlad and good morning everyone. As Prahlad briefly touched on, in the second quarter, we continue to do a very good job of executing on those items that are more fully within our control, such as our expenses, which led to strong margin performance, and our working capital management, which led to exceptional free cash flow conversion and cash generation. While pharma and biotech spending continue to remain challenging in the second quarter, the uniqueness of Revvity allowed us to overcome these headwinds and be in a position to raise our margin and adjusted EPS expectations for the year.

Maxwell Krakowiak: Thanks a lot, and good morning everyone. As for a lot of briefly touched on in the second quarter, we continue to do a very good job of executing on those items that are more fully within our control, such as our expenses, which led to strong margin performance, and our working capital management, which led to exceptional free cash flow conversion and cash generation. While farmer and biotech spending continue to remain challenging in the second quarter, the uniqueness of revenue allowed us to overcome these headwinds and be in a position to raise our margin and adjusted EPS expectations for the year.

Max: Thanks, Brad and good morning, everyone.

Max: As per lot briefly touched on in the second quarter. We continue to do a very good job of executing on those items that are more fully within our control such as our expenses, which led to strong margin performance and our working capital management, which led to exceptional free cash flow conversion and cash generation.

Pharma and biotech spending continue to remain challenging in the second quarter.

Speaker Change: Yes, a remedy allowed us to overcome these headwinds and be in a position to raise our margin and adjusted EPS expectations for the year.

Maxwell Krakowiak: This strong performance here to date, combined with our successful cash generation, positions us to more aggressively deploy capital at a very opportunistic time. We plan to begin more significant share repurchase activity going forward, in addition to remaining focus on proactively deleveraging.

Maxwell Krakowiak: This strong performance year to date, combined with our successful cash generation, positions us to more aggressively deploy capital at a very opportunistic time. We plan to begin more significant share repurchase activity going forward, in addition to remaining focused on proactively deleveraging. These actions are expected to drive meaningful value creation for our shareholders in the years to come while providing even more flexibility to us for future capital deployment activities in the future. Now, turning to the specifics of our second quarter performance.

Speaker Change: This strong performance year to date combined with our successful cash generation positions us to more aggressively deploy capital at a very opportunistic time.

Speaker Change: We plan to begin more significant share repurchase activity going forward. In addition to remaining focus on proactively deleveraging.

Maxwell Krakowiak: These actions are expected to drive meaningful value creation for our shareholders in the years to come, while providing even more flexibility to us for future capital deployment activities in the future. Now turning to the specifics of our second quarter performance, overall, the company generated total adjusted revenues of $692 million in the quarter, resulting in a 1% decline in organic revenue through at the high end of our expectations. FX was a 1% headwind, which was slightly worse than expected, and we again had no incremental contribution from acquisitions. As it relates to our P&L, we are pleased to report we generated 28.7% adjusted operating margins in the quarter, which was up significantly versus the first quarter and was roughly 120 basis points above our expectations.

Speaker Change: These actions are expected to drive meaningful value creation for our shareholders in the years to come while providing even more flexibility to us for future capital deployment activities in the future.

Maxwell Krakowiak: Overall, the company generated total adjusted revenues of $692 million in the quarter, resulting in a 1% decline in organic revenue, which was at the high end of our expectation. FX was a 1% headwind, which was slightly worse than expected, and we again had no incremental contribution from acquisitions. As it relates to our P&L, we are pleased to report we generated 28.7% adjusted operating margins in the quarter, which was up significantly versus the first quarter and was roughly 120 basis points above our expectations. I'm extremely proud of our team's execution from a cost perspective by controlling what we can control, realizing additional synergies, and experiencing the full benefit of the restructuring actions we took at the end of last year.

Speaker Change: Now turning to the specifics of our second quarter performance.

Speaker Change: Overall, the company generated total adjusted revenues of $692 million in the quarter, resulting in a 1% decline in organic revenue or is that the high end of our expectations.

FX was a 1% headwind, which was slightly worse than expected and we again had no incremental contribution from acquisitions.

Speaker Change: As it relates to our P&L. We are pleased to report we generated 28, 7% adjusted operating margins in the quarter, which was up significantly versus the first quarter and was roughly 120 basis points above our expectations.

Maxwell Krakowiak: I'm extremely proud of our team's execution from a cost perspective by controlling what we can control, realizing additional synergies, and experiencing the full benefit of the restructuring actions we took at the end of last year. Looking below the line, our adjusted net interest in other expense was 8 million in the quarter as we are benefiting from our strong cash inflows and the favorable interest environment against our fixed rate debt, while our adjusted tax rate was 21.1%. With an average deluded share count of 123.5 million for the quarter, this resulted in an adjusted EPS in the second quarter of a dollar and 22 cents, which was 10 cents above our expectations.

Speaker Change: I am extremely proud of our team's execution from a cost perspective by controlling what we can control.

Speaker Change: Realizing additional synergies and experiencing the full benefit of the restructuring actions. We took at the end of last year.

Maxwell Krakowiak: Looking below the line, our adjusted net interest and other expense was $8 million in the quarter as we are benefiting from our strong cash inflows and the favorable interest environment against our fixed rate debt, while our adjusted tax rate was $21.1%. With an average diluted share count of $123.5 million for the quarter, this resulted in an adjusted EPS in the second quarter of $1.22, which was $0.10 above our expectations. Moving beyond the P&L, we generated free cash flow of $160 million in the quarter, resulting in a free cash flow conversion of our adjusted net income of 107%.

Speaker Change: Looking below the line our adjusted net interest and other expense was $8 million in the quarter as we are benefiting from our strong cash inflows and the favorable interest environment against our fixed rate debt, while our adjusted tax rate was 21, 1%.

Speaker Change: With an average diluted share count of $123 5 million for the quarter. This resulted in an adjusted EPS in the second quarter of $1 22.

Speaker Change: Which was <unk> 10 above our expectations.

Maxwell Krakowiak: Moving beyond the P&L, we generated free cashflow of 160 million in the quarter, resulting in free cashflow conversion of our adjusted net income of 107%. This brings the free cashflow generated year-to-date to 293 million, resulting in 108% conversion of our adjusted net income. This result is clearly outstanding, as our teams have an increased focus on managing all aspects of working capital to better optimize the business following the transformation we have gone through over the last several years. As I mentioned, in addition to this internally generated cash, we also received an additional inflow of approximately 150 million in the quarter from Perkin Elmer, with additional payments expected over the remainder of the year.

Speaker Change: Moving beyond the P&L, we generated free cash flow of $160 million in the quarter, resulting in free cash flow conversion of our adjusted net income of 107%.

Maxwell Krakowiak: This brings the free cash flow generated year-to-date to $293 million, resulting in a 108% conversion of our adjusted netting. This result is clearly outstanding, as our teams have an increased focus on managing all aspects of working capital to better optimize the business following the transformation we have gone through over the last several years. As I mentioned, in addition to this internally generated cash, we also received an additional inflow of approximately $150 million in the quarter from Perkin Elmer, with additional payments expected over the remainder of the year.

Speaker Change: This brings our free cash flow generated year to date to $293 million.

Speaker Change: Resulting in a 108% conversion of our adjusted net income.

Speaker Change: This result is clearly outstanding as our teams have an increased focus on managing all aspects of working capital to better optimize the business. Following the transformation we have gone through over the last several years.

Speaker Change: As I mentioned in addition to this internally generated cash. We also received an additional inflow of approximately $150 million in the quarter from Perkin Elmer with additional payments expected over the remainder of the year.

Maxwell Krakowiak: You will note that the receipt of these Perkin Elmer related payments are positively impacting the discontinued operations line in our investing cash flow statement. As for capital deployment, we remained active in the second quarter. We were purchased $20 million of shares in the quarter, while also increasing our funding towards key capital expenditure projects. As discussed, we intend to step up our repurchase activity over the remainder of the year, while remaining committed to our investment-grade credit rating. We finished the quarter with a net debt to adjusted EBITDA leverage ratio of 2.4 times.

Maxwell Krakowiak: You will note that the receipt of these Perkinoma-related payments is positively impacting the discontinued operations line in our investing cash flow state. As for capital deployment, we remained active in the second quarter. We repurchased $20 million of shares in the quarter while also increasing our funding towards key capital expenditure projects.

Speaker Change: You will note that the receipt of these <unk> related payments are positively impacting the discontinued operations line in our investing cash flow statement.

Speaker Change: As for capital deployment, we remain active in the second quarter, we repurchased $20 million of shares in the quarter, while also increasing our funding towards key capital expenditure projects.

Maxwell Krakowiak: As discussed, we intend to step up our repurchase activity over the remainder of the year while remaining committed to our investment grade credit rating. We finished the quarter with a net debt to adjusted EBITDA leverage ratio of 2.4 times. I will now provide some commentary on our second quarter business trends, which is also included in the quarterly slide presentation on our investor relations website. The 1% decline in organic revenue in the quarter was comprised of a 6% decline in our life sciences segment and 3% growth in diagnostics.

Speaker Change: As discussed we intend to step up our repurchase activity over the remainder of the year, while remaining committed to our investment grade credit rating.

Speaker Change: We finished the quarter with a net debt to adjusted EBITDA leverage ratio of two four times.

Maxwell Krakowiak: I will now provide some commentary on our second quarter business trends, which is also included in the quarterly slide presentation on our Investor Relations website. The 1% decline in organic revenue in the quarter was comprised of a 6% decline in our life sciences segment and 3% growth in diagnostics. Geographically, we decline in the low single digits in the Americas, in Europe, and grew low single digits in Asia, with China declining low double digits. From a segment perspective, our life sciences business generated adjusted revenue of 314 million in the quarter. This was down 7% on a reported basis and 6% on an organic basis.

Speaker Change: I will now provide some commentary on our second quarter business trends, which is also included in the quarterly slide presentation on our Investor Relations website.

Speaker Change: The 1% decline in organic revenue in the quarter was comprised of a 6% decline in our life Sciences segment and 3% growth in diagnostics.

Maxwell Krakowiak: Geographically, we declined in the low single digits in the Americas and Europe and grew in the low single digits in Asia, with China declining in the low double digits. From a segment perspective, our life sciences business generated adjusted revenue of $314 million in the quarter. This was down 7% on a reported basis and 6% on an organic basis. From a customer perspective, sales to both pharmaceutical and biotech customers and academic and government customers declined in the mid-single digits in the quarter.

Speaker Change: Graphically we declined in the low single digits in the Americas, and Europe and grew low single digits in Asia with China declining low double digits.

Speaker Change: From a segment perspective, our life Sciences business generated adjusted revenue of $314 million in the quarter.

Speaker Change: This was down 7% on a reported basis and 6% on an organic basis from.

Maxwell Krakowiak: From a customer perspective, sales to both pharma biotech customers and academic and government customers declined in the mid single digits in the quarter. Our life sciences instrument revenue was down low teams in the quarter, and our reagents, which includes our technology licensing and specialty pharma services revenue, declined high single digits. Our reagent performance was negatively impacted by the difficult technology licensing cost, which can tend to be lumpy and did not repeat this year. Absent these comp headwinds, the more modest low to mid single digit decline in reagents was still below our expectations as there continued to be pockets of pharma headcount reduction activity across the industry.

Speaker Change: From a customer perspective sales to both pharma biotech customers and academic and government customers declined in the mid single digits in the quarter.

Maxwell Krakowiak: Our life sciences instrument revenue was down low teens in the quarter, and our reagents, which include our technology licensing and specialty pharma services revenue, declined high single digits. Our reagent performance was negatively impacted by the difficult technology licensing comps, which can tend to be lumpy and did not repeat this year. Absent these comp headwinds, the more modest low to mid-single-digit decline in reagents was still below our expectations as there continue to be pockets of pharma headcount reduction activity across the industry.

Speaker Change: Our life Sciences instrument revenue was down low teens in the quarter and our reagents, which includes our technology licensing and specialty pharma services revenue declined high single digits.

Speaker Change: Our reagent performance was negatively impacted by the difficult technology licensing costs, which can tend to be lumpy and did not repeat this year.

Speaker Change: Absent these comp headwinds the more modest low to mid single digit decline in reagents was still below our expectations. As there continues to be pockets of pharma head count reduction activity across the industry.

Maxwell Krakowiak: We are not expecting any meaningful improvement in absolute reagent sales volumes in the back half of the year, but we will begin to face easier comparison starting here in the third quarter. Our signal software business with a highlight again, this quarter has a grew in the high teams organically year over year. We are seeing strong traction across the board in this business, including with our net customer retention, new business wins, that's conversions, and good initial adoption of recent new product launches. The business will face some tough comp dynamics in the third quarter before returning to robust growth in the fourth quarter to finish out what is on pace to be a very strong year.

Maxwell Krakowiak: We are not expecting any meaningful improvement in absolute reagent sales volumes in the back half of the year, but we will begin to face easier comparisons starting here in the third quarter. Our signal software business was a highlight again this quarter as it grew in the high teens organically year over year.

Speaker Change: We are not expecting any meaningful improvement in absolute reagent sales volumes in the back half of the year. So we will begin to face easier comparisons starting here in the third quarter.

Maxwell Krakowiak: We are seeing strong traction across the board in this business, including with our net customer retention, new business wins, fast conversions, and good initial adoption of recent new product launches. The business will face some tough comp dynamics in the third quarter before returning to robust growth in the fourth quarter to finish out what is on pace to be a very strong year. In our diagnostics segment, we generated $378 million of adjusted revenue in the quarter, which was up 1% on a reported basis and 3% on an organic basis.

Speaker Change: Our signal software business was a highlight again this quarter as it grew in the high teens organically year over year.

Speaker Change: We are seeing strong traction across the board in this business, including with our net customer retention new business win SaaS conversions and good initial adoption of recent new product launches.

Speaker Change: The business will face some tough comp dynamics in the third quarter before returning to robust growth in the fourth quarter to finish out what is on pace to be a very strong year.

Maxwell Krakowiak: In our diagnostic segment, we generated 378 million of adjusted revenue in the quarter, which was up 1% on a reported basis and 3% on an organic basis. From a business perspective, our immunodagnastics business grew in the high single digits organically during the quarter, solidly above our expectations. The business continues to perform well with its newer offerings and again experience robust growth in the Americas. This helped offset flat performance in China as it was pressured from the go-to-market change we implemented at the beginning of the year. Our reproductive health business grew in the low single digits organically in the quarter.

Speaker Change: In our diagnostics segment, we generated $378 million of adjusted revenue in the quarter, which was up 1% on a reported basis and 3% on an organic basis.

Maxwell Krakowiak: From a business perspective, our immunodiagnostics business grew in the high single digits organically during the quarter, solidly above our expectations. The business continues to perform well with its newer offerings and again experienced robust growth in the Americas. This helped offset flat performance in China as it was pressured from the go-to-market change we implemented at the beginning of the year. Our reproductive health business grew in the low single digits organically in the quarter. Newborn screening continued to perform well and grew in the low single digits in the quarter globally despite continued pressure in China.

Speaker Change: From a business perspective, our immuno diagnostics business grew in the high single digits organically during the quarter solidly above our expectations.

Speaker Change: The business continues to perform well with its newer offerings and again experienced robust growth in the Americas.

Speaker Change: This helped to offset flat performance in China as it was pressured from the go to market change we implemented at the beginning of the year.

Our reproductive health business grew in the low single digits organically in the quarter.

Maxwell Krakowiak: Newborn screening continued to perform well and grew in the low single digits in the quarter globally, despite continued pressure in China. Excluding China, our newborn business again grew in the high single digits. We are optimistic for the recent pressures on our newborn business in China to subside starting this quarter, allowing us to return to more meaningful growth to finish up the year. Finally, our applied genomics business declined in the low double digits in the quarter. Based on conversations with customers and our current order pipeline, we are cautiously optimistic that we may now have found the bottom in this business, as we expect it to be roughly flat here in the third quarter before returning to positive growth to close out the year.

Speaker Change: Newborn screening continues to perform well and grew in the low single digits in the quarter globally. Despite continued pressure in China exclude.

Maxwell Krakowiak: Excluding China, our newborn business again grew in the high single digits. We are optimistic that the recent pressures on our newborn business in China will subside starting this quarter, allowing us to return to more meaningful growth to finish the year. Finally, our applied genomics business declined in the low double digits in the quarter.

Speaker Change: Excluding China, our newborn business again grew in the high single digits.

Speaker Change: We are optimistic for the recent pressures on our newborn business in China to subside, starting this quarter, allowing us to return to more meaningful growth to finish up the year.

Finally, our applied genomics business declined in the low double digits in the quarter base.

Maxwell Krakowiak: Based on conversations with customers and our current order pipeline, we are consciously optimistic that we may now have found the bottom in this business, as we expect it to be roughly flat here in the third quarter before returning to positive growth to close out the year. As it pertains to China specifically, our revenue in the country overall declined in the low double digits year-over-year. This consisted of a high single-digit decline for diagnostics and a low double-digit decline in life sciences.

Speaker Change: Based on conversations with customers and our current order pipeline. We are cautiously optimistic that we may now have found the bottom in this business as we expect it to be roughly flat here in the third quarter before returning to positive growth to close out the year.

Maxwell Krakowiak: as it pertains to trying to specifically our revenue in the country overall decline in the low double digits year over year. This consisted of a high single-digit decline for diagnostics and a low double-digit decline in life sciences. Late in the quarter, we began to see a more meaningful slowing in demand for instrumentation as more customers are holding off on their purchasing decisions until the availability in terms of stimulus becomes clearer. This resulted in our life science and applied genomics instrumentation in China being down over 30% overall in the quarter. While we are optimistic that the current stimulus programs will positively impact parts of our business in China eventually, we are not assuming this incremental tailwind significantly materializes until next year.

Speaker Change: As it pertains to China, specifically, our revenue in the country overall decline in the low double digits year over year. This consisted of a high single digit decline for diagnostics and a low double digit decline in life Sciences late in the quarter, we began to see a more meaningful slowing in demand for instrumentation as more customers are holding off.

Maxwell Krakowiak: Late in the quarter, we began to see a more meaningful slowing in demand for instrumentation as more customers are holding off on their purchasing decisions until the availability of stimulus in terms of stimulus becomes clear. This resulted in our life science and applied genomics instrumentation in China being down over 30% overall in the quarter. While we are optimistic that the current stimulus programs will positively impact parts of our business in China eventually, we are not assuming that this incremental tailwind significantly materializes until next year. Consequently, we expect our life science and applied genomics instrumentation in China to remain challenged until stimulus arrives.

Speaker Change: On their purchasing decisions until the availability in terms of stimulus becomes clear.

Speaker Change: This resulted in our life science and applied genomics instrument, Tashan and China being down over 30% overall in the quarter. While we are optimistic that the current stimulus programs will positively impact parts of our business in China. Eventually we are not assuming this incremental tailwind significantly materialize until next year.

Maxwell Krakowiak: Consequently, we expect our life science and applied genomics instrumentation in China to remain challenged until stimulus arrives. As a reminder for context, our life sciences and applied genomics instrumentation sales in China represents only approximately 3% of our overall revenues. In regards to the outlook for the remainder of the year, we are pleased by our performance year to date and are starting to see more encouraging signs from our recent former biotech customer conversations. Revenue is also fortunate that we have differentiated growth drivers within our company, which have continued to perform well, allowing us to maintain our positive organic growth outlook for the year.

Speaker Change: Consequently, we expect our life science and applied genomics instrumentation in China to remain challenged until stimulus arrives.

Maxwell Krakowiak: As a reminder for context, our life sciences and applied genomics instrumentation sales in China represent only approximately 3% of our overall revenue. In regards to the outlook for the remainder of the year, we are pleased by our performance year-to-date and are starting to see more encouraging signs from our recent Pharma Biotech customer conversations. Revvity is also fortunate that we have differentiated growth drivers within our company that have continued to perform well, allowing us to maintain our positive organic growth outlook for the year.

Speaker Change: As a reminder for context, our life Sciences and applied genomics instrumentation sales in China represents only approximately 3% of our overall revenues.

Speaker Change: In regards to the outlook for the remainder of the year. We are pleased by our performance year to date and are starting to see more encouraging signs from our recent pharma biotech customer conversations.

Speaker Change: Revenue is also fortunate that we have differentiated growth drivers within our company, which has continued to perform well, allowing us to maintain our positive organic growth outlook for the year.

Maxwell Krakowiak: Given we are now at the midpoint of the year and based on our outlook for the remaining six months, we continue to expect that the 2% midpoint of our organic growth guidance is the most likely scenario for the year. With the continued strength in the US dollar at the end of June, we are now anticipating a negative 1% headwind from FX for the full year compared to our prior outlook of FX having a neutral impact. We expect these two factors to result in our full year 2024 revenue being in the range of 2.77 to 2.79 billion.

Maxwell Krakowiak: Given we are now at the midpoint of the year, and based on our outlook for the remaining six months, we continue to expect that the 2% midpoint of our organic growth guidance is the most likely scenario for the year. With the continued strength in the U.S. dollar at the end of June, we are now anticipating a negative 1% headwind from FX for the full year compared to our prior outlook of FX having a neutral impact.

Speaker Change: Given we are now at the midpoint of the year and based on our outlook for the remaining six months.

Speaker Change: We continue to expect that the 2% midpoint of our organic growth guidance is the most likely scenario for the year.

Speaker Change: With the continued strength in the U S. Dollar at the end of June we are now anticipating a negative 1% headwind from FX for the full year compared to our prior outlook of FX, having a neutral impact.

Maxwell Krakowiak: We expect these two factors to result in our full-year 2024 revenue being in the range of $2.77 to $2.79 billion. With our profitability pacing better than previously anticipated, and our non-operating items also coming in favorable, we are excited to share that we are raising our adjusted earnings per share guidance for the year as our expense, cash flow, and balance sheet management have been excellent, which we expect to continue. Consequently, we now expect our 2024 adjusted EPS to be in the range of $4.70.

Speaker Change: We expect these two factors to result in our full year 2024 revenue being in the range of $2 77 to $2 79 billion.

Maxwell Krakowiak: With our profitability pacing better than previously anticipated and our non-operating items also coming in favorable, we are excited to share that we are raising our adjusted earnings per share guidance for the year, as our expense, cash flow, and balance sheet management have been excellent, which we expect to continue. Consequently, we now expect our 2024 adjusted ETS to be in the range of $4.70 to $4.80, out from our prior outlook of $4.55 to $4.75. Given that we believe the lower than normal growth this year is only temporary, we plan to capitalize on this opportunity by becoming even more active in our capital deployment via share purchases over the remainder of the year.

Speaker Change: With our profitability pacing better than previously anticipated and are non operating items also coming in favorable.

Speaker Change: We are excited to share that we are raising our adjusted earnings per share guidance for the year as our expense cash flow and balance sheet management have been excellent, which we expect to continue.

Speaker Change: Consequently, we now expect our 2020 for adjusted EPS to be in the range of $4 70.

Maxwell Krakowiak: $4.80, up from our prior outlook of $4.55 to $4.75. Given that we believe the lower than normal growth this year is only temporary, we plan to capitalize on this opportunity by becoming even more active in our capital deployment via share repurchases over the remainder of the year. We expect this plan to step up, and buyback activity will pay meaningful dividends for our shareholders in the years to come. With our strong margin performance in the first half, which we anticipate will continue over the remainder of the year, we now expect our adjusted operating margins to be in the range of 28 to 28.5% for the year, up from our prior 28% outlook.

Speaker Change: To $4 80.

Speaker Change: Up from our prior outlook of $4 55 to $4 75.

Speaker Change: Given that we believe the lower than normal growth. This year is only temporary and we plan to capitalize on this opportunity by becoming even more active in our capital deployment via share repurchases over the remainder of the year.

Maxwell Krakowiak: We expect this plan step up and buy back activity will pay meaningful dividends for our shareholders in the years to come. With our strong margin performance in the first half, which we anticipate will continue over the remainder of the year, we now expect our adjusted operating margins to be in the range of 28 to 28 and a half percent for the year, up from our prior 28 percent outlook. Below the operating line, we are also doing a great job managing those items that are more fully within our control. Given the strong task of a year-to-date combined with the inflow of nearly $150 million from Perkin Elmer, we now expect our net interest and other expense for the year to be approximately $50 million, down from our prior outlook of $60 million.

Speaker Change: We expect this planned step up in buyback activity will pay meaningful dividends for our shareholders in the years to come.

Speaker Change: With our strong margin performance in the first half, which we anticipate will continue over the remainder of the year. We now expect our adjusted operating margins to be in the range of 28 to 28, 5% for the year up from our prior 28% outlook.

Maxwell Krakowiak: Below the operating line, we are also doing a great job managing those items that are more fully within our control. Given the strong cash flow year to date, combined with the inflow of nearly $150 million from Perkin Elmer, we now expect our net interest and other expense for the year to be approximately $50 million, down from our prior outlook of $60 million. We continue to expect our tax rate to be a little over 20% for the full year.

Speaker Change: Below the operating line. We are also doing a great job managing those items that are more fully within our control.

Speaker Change: Given the strong cash flow year to date combined with the inflow of nearly $150 million from Perkin Elmer we now expect our net interest and other expense for the year to be approximately $50 million down from our prior outlook of $60 million.

Maxwell Krakowiak: We continue to expect our tax rate to be a little over 20% for the full year. Since we do not account for share repurchase activity in our guidance until it is actually completed, for the time being we are still expecting a diluted share count of approximately 123.5 million shares. As mentioned, we anticipate the impact from any share repurchases we make over the coming months to be relatively neutral to our adjusted EPS in the near term, as we are already more than halfway through the year and it would have an offsetting effect on our interest income.

Speaker Change: We continue to expect our tax rate to be a little over 20% for the full year.

Maxwell Krakowiak: Since we do not account for share repurchase activity in our guidance until it is actually completed, for the time being, we are still expecting a diluted share count of approximately 123.5 million shares. As mentioned, we anticipate the impact of any share repurchases we make over the coming months to be relatively neutral to our adjusted EPS in the near term, as we are already more than halfway through the year, and it would have an offsetting effect on our interest income.

Speaker Change: Since we do not account for share repurchase activity and our guidance until it actually completed for the time being we are still expecting a diluted share count of approximately $123 5 million shares.

Speaker Change: As mentioned, we anticipate the impact from any share repurchases, we make over the coming months to be relatively neutral to our adjusted EPS in the near term as we are already more than halfway through the year and it would have an offsetting effect on our interest income.

Maxwell Krakowiak: In the third quarter, we are anticipating our organic growth to improve relative to the first half of the year and grow in the low single digits year over year, while FX is currently expected to be a headwind of approximately a hundred basis points. We again expect to hold our operating expenses relatively flat sequentially, resulting in adjusted operating margins of around 28%. Our net interest in others should be roughly 50% sequentially in the third quarter to approximately 12 million, and we expect a third quarter tax rate of approximately 22%. Overall, this results in an adjusted EPS in the third quarter expected to be in the range of a dollar and ten cents through a dollar and fourteen cents.

Maxwell Krakowiak: In the third quarter, we are anticipating our organic growth to improve relative to the first half of the year and grow in the low single digits year-over-year, while FX is currently expected to be a headwind of approximately 100 bases per year. We again expect to hold our operating expenses relatively flat sequentially, resulting in adjusted operating margins of around 28%. Our net interest in others should be up roughly 50% sequentially in the third quarter to approximately $12 million, and we expect a third quarter tax rate of approximately 22%.

Speaker Change: In the third quarter, we are anticipating our organic growth to improve relative to the first half of the year and grow in the low single digits year over year. While FX is currently expected to be a headwind of approximately 100 basis points.

Speaker Change: We again expect to hold our operating expenses relatively flat sequentially, resulting in an adjusted operating margins of around 28%.

Speaker Change: Our net interest and other should be up roughly 50% sequentially in the third quarter to approximately $12 million and we expect a third quarter tax rate of approximately 22%.

Maxwell Krakowiak: Overall, this results in an adjusted EPS in the third quarter expected to be in the range of $1.10 to $1.14. Overall, we had a strong second quarter despite market challenges continuing, as we executed extremely well on our areas of focus that are more within our control. The uniqueness of Revity is allowing us to continue to forecast positive organic growth when many others in the industry are not. Combined with our ability to properly manage the business, it is allowing us to raise our adjusted operating margin, free cash flow, and adjusted EPS guidance for the year, which I am very proud of. With that, Operator, we would now like to open up the call for questions.

Speaker Change: Overall this resulted in an adjusted EPS in the third quarter expected to be in the range of $1 10 to $1 14.

Maxwell Krakowiak: Overall, we have a strong second quarter despite market challenges continuing as we executed extremely well on our areas of focus that are more within our control. The uniqueness of revenue is allowing us to continue to forecast positive organic growth when many others in the industry are not. Combined with our ability to properly manage the business, it is allowing us to raise our adjusted operating margin, free cash flow, and adjusted EPS guidance for the year, which I am very proud of.

Speaker Change: Overall, we had a strong second quarter despite market challenges continuing as we executed extremely well on our areas of focus that are more within our control. The uniqueness of revenues is allowing us to continue to forecast positive organic growth when many others in the industry or not.

Speaker Change: Combined with our ability to properly manage the business.

Speaker Change: Allowing us to raise our adjusted operating margin free cash flow and adjusted EPS guidance for the year, which I'm very proud of.

Unknown Executive: With that operator, we would now like to open up the call for questions.

Speaker Change: With that operator, we would now like to open up the call for questions.

Unknown Executive: Thank you. If you would like to ask a question, please press starfall about one on your telephone keypad. If you would like to withdraw your question, please press starfall about two. When preparing to ask your question, please ensure your device is unmuted locally.

Operator: Thank you. If you would like to ask a question, please press star followed by one on your telephone keypad. If you would like to withdraw your question, please press star followed by two. When preparing to ask your question, please ensure your device is unmuted locally. Our first question comes from Patrick Donnelly with City. Your line is open, please go ahead.

Speaker Change: Thank you if you'd like to ask a question. Please press star followed by one on your telephone keypad.

Speaker Change: I would like to withdraw your question. Please press star followed by.

Speaker Change: When preparing to ask you a question. Please ensure your device is on mute locally.

Patrick Donnelly: Our first question comes from Patrick Donnelly with City. Your line is open.

Speaker Change: Our first question comes from Patrick Donnelly with Citi. Your line is open. Please go ahead.

Patrick Donnelly: Please go ahead.

Patrick Donnelly: Hey, good morning, guys. Thanks for taking the questions. To lie, maybe you are on the reagent side. Certainly, understand the technology license and cost-waying thing down there, but then Max talked about. You know, that motorbid signal, maybe a little electric patient sounds as a pharmacist is just lingering there.

Patrick Bernard Donnelly: Hey, good morning, guys. Thanks for taking the questions. Prahlad, maybe on the reagent side, you know, certainly understand the technology licensing comps weighing things down there. But as Max talked about, you know, that low to mid single, maybe a little bit below expectation sounds like the pharma piece is just lingering there. You know, can you just talk about, I guess, what you're seeing, kind of break down the business a little bit, whether it's BioLegend or different segments, and just talk about the trends you're seeing, and then expectations. It does not sound like you guys are bringing in much of an improvement in the guide. It would be helpful to just talk through what you're seeing and this expectation of what you guys are looking for to signal a recovery.

Patrick Bernard Donnelly: Hey, good morning, guys. Thanks for taking the questions.

Speaker Change: <unk>, maybe on the reagent side.

Certainly understand the technology licensing comps when you dig down there, but and then Max talked about that low to mid single, maybe a little bit below expectations. It sounds like the pharma piece.

Speaker Change: There.

Patrick Donnelly: You know, can you just talk about, I guess, what you're seeing, kind of break down the business a little bit with its bio-legend different segments and just talk about the trends you're seeing and then expectations that does not sound like you guys are making much of an improvement in the guide. We'll be helpful to just talk through what you're seeing and this expectation of looking forward to the signal recovery there.

Speaker Change: Could you just talk about I guess, what youre seeing and kind of break down the business a little bit whether it's by a legend of different segments.

Speaker Change: And just talk about the trends youre seeing in that expectations. It does not sound like you guys are baking in much of improvement in the guide.

Speaker Change: It'd be helpful to just talk through what you're seeing in the expectations of what you guys are looking for to signal a recovery there.

Prahlad Singh: Hey Patrick, good morning. Sure. So, you know, on the reagent side, as you heard from both Max and I and the prepared remarks, you know, we saw some sporadic, I would say, volatility and additional site consolidations and closed down that happened around the middle of the quarter. You know, but the head count reductions in site consolidations we saw, I think, you know, it's now mostly behind us. I mean this; outside of this, I would say sporadicness, we've seen generally nine months of stability, and that's what gives us increased confidence that the worst is behind us.

Prahlad R. Singh: Hey, Patrick, good morning. Sure. So, you know, on the reagent side, as you heard from both Max and me in the prepared remarks, you know, we saw some sporadic, I would say volatility and additional site consolidations and closures that happened around the middle of the quarter. But the headcount reductions and site consolidations we saw, I think, you know, they're now mostly behind us. I mean, outside of this, I would say sporadicness; we've seen generally nine months of stability.

Speaker Change: Hey, Patrick Good morning sure so.

Patrick Bernard Donnelly: The reagent side as you heard from both maximize the prepared remarks.

Speaker Change: We saw some sporadic I would say volatility in additional site consolidations and closed on that happened around the middle of the quarter.

Speaker Change: But the head count reductions and site consolidations, we saw I think it's now mostly behind us.

Speaker Change: Outside of this I would say sporadic Miss we've seen generally nine months of stability and Thats, what gives us increased confidence that the worst is behind us.

Prahlad R. Singh: And that's what gives us increased confidence that the worst is behind us. You know, in terms of the current guidance, we assume a very similar level of absolute dollars in the third quarter versus the second quarter, with some, I would say, normal seasonal improvements from that going on in 4Q. I think the essence of your question is that we feel like the worst of the cuts that are going on in the pharma biotech sector are now likely behind us. And that's what sort of gives us a sense of increased visibility into the second half.

Prahlad Singh: You know, in terms of the current guidance, we assume a very similar level of absolute dollars in the third quarter versus the second quarter. With some, I would say normal seasonal improvements from that going on and for Q. But I think, yes, into your question, we feel like the worst of the cuts that are going on in the pharma biotech is now likely behind us. And that's what sort of gives us a sense of increased visibility into the second half.

Speaker Change: In terms of the current guidance, we assume very similar level of absolute dollars in the third quarter versus the second quarter with some I would say normal seasonal improvements from that going on in <unk> I think <unk> to your question is we feel like the worst of the cuts that are going on in the pharma biotech is now likely behind us and Thats what sort of.

Speaker Change: It gives us a sense of increased visibility into the second half.

Patrick Donnelly: Okay, that's helpful.

Patrick Bernard Donnelly: Okay, that's helpful. And then maybe one for Max, just on the margins, you know, nice performance, good to see that come through in 2Q.

Speaker Change: Okay. That's helpful. And then maybe one for Max just on the margins nice performance good to see that come through in Q2.

Patrick Donnelly: And then maybe one for Max just on the margins, you know, nice performance, good to see that come through and teach you, you know, obviously knew the guidance up a little bit there. Can you talk about the moving pieces? How much of it is the restructuring versus any mix?

Speaker Change: Obviously moved the guidance up a little bit there can you just talk about the moving pieces how much of it is the restructuring versus any mix and then it sounds like again. Its 2025, good launching point for next year can you just remind us how you think about the algorithm as we work our way into next year and then any moving pieces, we should be thinking about.

Maxwell Krakowiak: And then, you know, it sounds like again, this 2020 and the half good launching point for next year. If you could just remind us how you think about the algorithm as we work our way into next year and any moving pieces we should be thinking about, much appreciated guys.

Speaker Change: Much appreciate it guys. Thanks.

Maxwell Krakowiak: Hey, Patrick, so from a margin standpoint, you know, I think we're encouraged by the performance for the team for the first half of the year. Again, that's leading us to take up the margin expectations for the full year. I think when you think about the factors that are driving this, I would say it's really continued progress on our integrations. And synergies from some of the recent acquisitions, in addition to the restructuring actions that we took at the end of last year. So I think it's kind of a combination of those two factors is really the predominant driving force on the margin side.

Maxwell Krakowiak: You obviously need guidance a little bit there. Can you talk about the moving pieces? How much of it is the restructuring versus any mix? And then, you know, it sounds like again it's 20, 20 and a half, a good launching point for next year. Can you just remind us how you think about the algorithm as we work our way into next year and any moving pieces we should be thinking about? Much appreciated. [inaudible]

Speaker Change: Yeah, Hey, Patrick so from a margin standpoint, I think we're encouraged by the performance for the team for the first half of the year again, thats, leading us to take up the margin expectations for the full year I think when you think about the factors that are driving this I would say, it's really continued progress on our.

Maxwell Krakowiak: Hey Patrick, so from a margin standpoint, you know, I think we're encouraged by the performance of the team in the first half of the year. Again, that's leading us to take up the margin expectations for the full year. I think when you think about the factors that are driving this, I would say it's really continued progress on our integrations and synergies from some of the acquisitions, in addition to the restructuring actions that we took at the end of last year.

Speaker Change: Integrations and synergies from some of the recent acquisitions. In addition to the restructuring actions that we took at the end of last year. So I think it's kind of a combination of those two factors is really the predominant driving force on the margin side as we look longer term as a reminder, our LRT kind of calls for 75 basis points of <unk> per year, assuming a normal market growth.

Maxwell Krakowiak: So I think it's kind of a combination of those two factors that is really the predominant driving force on the margin side. As we look longer term, as a reminder, LRP kind of calls for 75 basis points of OMX per year, assuming a normal market growth rate environment. I think, as we mentioned in the call, we'll see about 25 here either at our analyst day or again in January. But I think for us, if we are in a normal market environment, we feel very confident on the 75 BIFs OMX per year.

Maxwell Krakowiak: As we look, you know, longer term is reminder LRP kind of calls for 75 basis points of OMX per year, assuming a normal market growth rate environment. You know, I think we, as we mentioned, the call will see, you know, about 25 here, either at, you know, our analyst day or again in January. But I think for us, if we are in a normal market environment, we feel very confident on the 75 fifths OMX per year.

Speaker Change: Rate environment, Yes, I think as we mentioned in the call, we'll see about 25 here either.

Speaker Change: Our analyst day or again in January but I think for us. If we are in a normal market environment and feel very confident on the 75 bps on that per year.

Jack Meehan: We now turn to Jack Meahan with nephron research. Your line is open.

Jack Meehan: We now turn to Jack Meehan with Nephron Research. Your line is open, please go ahead.

We now turn to Jack Meehan with Nephron Research. Your line is open. Please go ahead.

Jack Meehan: Please go ahead. Thank you.

Jack Meehan: Good morning. I wanted to ask about China diagnostics, starting with immunodiagnostics flat in the quarter, what are your expectations for the second half of the year? And can you just remind us what the go-to-market changes you made were earlier in the year and how those are playing out? Thanks.

Jack Meehan: Thank you good morning.

Jack Meehan: Good morning. When to ask about China diagnostics, starting with immunodiagnostics, flat in the quarter, what are your expectations for the second half of the year. Can you just remind us what the go-to-market changes you were made were earlier in the year and how those are playing out.

Jack Meehan: Wanted to ask about China diagnostics.

Jack Meehan: Starting with immuno diagnostics flat in the quarter what are your expectations for the second half of the year.

Jack Meehan: And can you just remind us what the go to market changes you were made were earlier in the year and how those are playing out.

Jack Meehan: Sure.

Maxwell Krakowiak: Yeah, sure. Hey, yeah.

Maxwell Krakowiak: Yeah, sure. Hey, Jack.

Speaker Change: Yeah, sure Hey, Jeff So from a China diagnostic standpoint, I would say for the second quarter really the headwind we face was on the instrumentation side as we mentioned in his prepared remarks, China <unk> was right in line with expectations being approximately flat as you look towards the second half of the year, specifically again for China.

Maxwell Krakowiak: So from a China diagnostics standpoint, you know, I would say for the second quarter, you know, really the head when we face was on the instrumentation side. As we mentioned in prepared remarks, China IDX was right in line with expectations, being approximately flat. As we look at towards the second half of the year, specifically again for China IDX, we anticipate positive mid-single-digit growth in the second half of the year.

Maxwell Krakowiak: So from a China diagnostic standpoint, you know, for the second quarter, really, the headwind we faced was on the instrumentation side. As we mentioned in the prepared remarks, China IDX was right in line with expectations, being approximately flat. As we look toward the second half of the year, specifically, again, for China IDX, we anticipate positive mid-single-digit growth in the second half of the year.

Speaker Change: We anticipate positive mid single digit growth in the second half of the year and I think then to your last question on the go to market change. This was for one of our older legacy product lines that we had in China. It was related mostly to an infectious disease portfolio at the beginning of the year. We did go through an indirect.

Maxwell Krakowiak: And I think, you know, then to your last question on the, you know, go to market change, this was for one of our older legacy product lines that we had in China. It was related mostly to an infectious disease portfolio. At the beginning of the year, we did go to an indirect commercial model. And so again, that's a little bit of a headwind from a revenue perspective, but it's been a tailwind from a profitability standpoint, and it's more or less played out as anticipated.

Maxwell Krakowiak: And I think, you know, then to your last question on the, you know, go to market change, this was for one of our older legacy product lines that we had in China, and it was related mostly to an infectious disease portfolio. At the beginning of the year, we did go to an indirect commercial model. And so again, that's been a little bit of a headwind from a revenue perspective, but it's been a tailwind from a profitability standpoint, and it's more or less played out as anticipated.

Speaker Change: Commercial model and so again that there's been a little bit of a headwind from a revenue perspective, but it's been a tailwind from a profitability standpoint, and it's more or less played out as anticipated.

Maxwell Krakowiak: Good. Got it.

Maxwell Krakowiak: Got it. Okay.

Speaker Change: Got it Okay, and then on the newborn screening side it sounds like that was still down in the quarter, but your content in that making a turn like what are you seeing on the ground. What gives you that confidence that you're going to term.

Maxwell Krakowiak: Okay. And then on the newborn screening size, sound like that was still down in the quarter, but you're confident in that making a turn. Like, what are you seeing on the ground? What gives you that confidence that business is going to turn. Thanks.

Maxwell Krakowiak: And then on the newborn screening side, it sounds like that was still down in the quarter. But you're confident that making a turn like what you're seeing on the ground? What gives you that confidence that business is going to turn? Yeah, Jack.

Prahlad Singh: Yeah, Jack, I think it's just as we've talked about earlier. The prenatal screening tends to be an early indicator around the, the portraits that are going to, you know, play out over the second half of the year. So it's nothing more than just seeing the prenatal screening numbers are going up that sort of gives us a sense that there will be improvement in both rates as we look into the second half of the year.

Maxwell Krakowiak: Yeah, Jack, I think, you know, it's just as we talked about earlier; prenatal screening tends to be an early indicator of birth rates that are going to play out over the second half of the year. So it's nothing more than just seeing the prenatal screening numbers going up; that sort of gives us a sense that there will be improvement in birth rates as we look into the second half of the year.

Speaker Change: Yeah, Jack I think just as we've talked about earlier the prenatal screening tends to be an early indicator around the boat rates that are going to play out towards the second half of the year. So it's nothing more than just seeing the prenatal screening numbers going up that sort of gives us a sense that there is.

Speaker Change: The improvement in both rates as we look into the second half of the year.

Puneet Suda: We now turn to Puneet Suda with Lee Rink Partners. Your line is open.

Puneet Sudha: We now turn to Puneet Sudha with Lee Rink Partners. Your line is open. Please go ahead.

Speaker Change: We now turn to Puneet <unk> with Leerink partners. Your line is open. Please go ahead.

Puneet Suda: Please go ahead. Great. Thanks. Good to be here. Proven max.

Puneet Sudha: Great. Thanks.

puneet: Great. Thanks, good to be here.

puneet: Pro rata and Max.

Puneet Suda: So first question is just a bit more on the max commented above the farm all else. We're all aware of it. So if provide that some of those folks, a preclinical folks are not getting back to labs anytime soon. So wondering, sort of what gives you confidence in the recovery within the biopharma segment.

puneet: So first question is just a bit more on the.

puneet: Matt commented above the pharma layouts.

All aware of it so a lot of that some of those folks are preclinical folks are not getting back to labs anytime soon so I'm wondering sort of what gives you confidence in the recovery within the Biopharma segment and then maybe if you could talk about early stage discovery versus academic we saw some improvement from your peers in the <unk>.

Puneet Sudha: Good to be here, Prahlad and Max. So, the first question is just a bit more on the, Max commented above, pharma layoffs. We're all aware of that.

Prahlad Singh: And then maybe if you could talk about early stage discovery versus academic, we saw some improvement from your peers in the more in the developmental later stages, but just wondering what you're seeing with the early discovery folks. Yeah, Puneet, I think the reason for the visibility that we talk about is that yes, the headcount reductions have been happened and the site consolidations are happening, but it's not that we are getting any indication that the programs are shutting down. It's the time that it takes to transition the program to say from the West Coast to an East Coast site that sort of gives us a sense of visibility as to when it comes back up and running.

Prahlad R. Singh: So, Prahlad, some of those folks, the preclinical folks, are not getting back to labs anytime soon. So, wondering sort of what gives you confidence in the recovery within the biopharma segment? Then maybe if you could talk about early stage discovery versus academic. We saw some improvement from your peers in the more advanced stages, but just wondering what you're seeing with the early discovery folks.

puneet: And the development in the later stages, but just wondering.

Speaker Change: What youre seeing with the early discovery folks.

Prahlad R. Singh: Yeah, Puneet, I think the reason for the visibility that we talk about is that here the headcount reductions have happened, and the site consolidations are happening. But it's not that we are getting any indication that the programs are shutting down. It's the time that it takes to transition the program, to say, from the West Coast to an East Coast site. That sort of gives us a sense of visibility as to when it comes back up and running.

Yes.

Speaker Change: I think the reason for the visibility that we talk about is that he is the head count reductions have happened in the site consolidations are happening, but it's not that we are getting any indication that the programs are shutting down. This is the time that it takes to transition the program to say from the West coast to East Coast site that sort of gives us a sense of visibility.

Prahlad R. Singh: And then that gives us a sense of, you know, what I said earlier, visibility into when the programs are. And that's what causes the volatility that I talked about earlier. In terms of early discovery versus clinical, if I'm not wrong, that was what your question was, Puneet? Yes. I mean, you know, at the end of the day, as I've said earlier, innovation is only going to happen as they continue to invest in early discovery programs. There are only two ways that you do it: either you invest in discovery or you buy compounds. And right now, what we are saying is that there is no indication that pharma biotech is saying that we are going to shut down the pipeline for innovation.

Speaker Change: These two when it comes back up and running.

Prahlad Singh: And then that gives us a sense of, you know, what I said earlier: visibility into when the programs are, and that's what causes the quality, what will volatility that I talked about earlier in terms of early discovery versus clinical if I'm not wrong. That was what your question was, Puneet.

Speaker Change: That gives us a sense of.

Speaker Change: What I said earlier visibility into when the program and that's what causes the volatility what kind of volatility that I talked about earlier.

Speaker Change: In terms of early discovery versus clinical if im not wrong that was what your question was.

Prahlad Singh: Yes, yes, I mean, you know, at the end of the day, as I have said earlier, innovation is only going to happen as they continue to. And continue to invest in early discovery programs, whether there are only two ways that you do it: either you invest in discovery or you buy compounds. And right now what we are saying is that there is no indication that former biotech is saying that we are going to shut down the pipeline for innovation.

Speaker Change: Yes, yes.

Speaker Change: Yes.

Speaker Change: I mean, you know at the end of the day as we as I've said earlier.

Speaker Change: Innovation is only going to happen as they continue to.

Speaker Change: Continue to invest in a new discovery programs.

Speaker Change: There are only two ways that you do it either you invest in discovery or you buy compounds and right now what we are saying is that there is no indication that pharma biotech is saying that we are going to shut down the pipeline for innovation.

Maxwell Krakowiak: And then just the last point on sort of the pre-revenue biotech funding question, you know, again, as a reminder, it's less than 5% of our total company revenue that's exposed to this customer group. However, I would say that the second quarter was a sequential improvement from the first quarter, so it does appear to be getting better, but it is still challenged overall and did decline in the period.

Prahlad Singh: And just the last point on sort of the pre-revenue biotech funding question, you know, again, as a reminder, it's less than 5% overall of our total company revenue that's exposed to this customer group. However, I would say that the second quarter was a sequential improvement from the first quarter, so it does appear to be getting better, but it is still challenged overall and did decline in the period.

And then just the last point on sort of the pre revenue biotech funding question.

Speaker Change: Again as a reminder, it's less than 5% overall of our total company revenue that's exposed to this customer group. However, I would say that the second quarter was a sequential improvement from the first quarter. So it does appear to be getting better but it is still challenged overall and did decline in the period.

Maxwell Krakowiak: Got it very helpful, and then just on the buybacks, max those 330 million dollars. Is that entirely this year? Just wanted to get this view on the cadence for that. Thank you. Yeah, so in terms of the 330 Puneet, that is just the authorization we have left on our share review and purchase program.

Puneet Sudha: Got it. Very helpful.

Speaker Change: Got it very helpful. And then just on the buybacks.

Speaker Change: Those $330 million is that entirely this year just wanted to get the view on the cadence for that thank you.

Maxwell Krakowiak: And then just on the buybacks, Max, those $330 million, is that entirely this year? Just wanted to get your view on the cadence for that. Thank you.

Speaker Change: Yes, so in terms of the $3 30, Puneet that is just the authorization. We have left on our share repurchase program. It's TBD exactly how the timing of that plays out I think the comments on our call was that we're going to be more opportunistically aggressive on the share repurchasing and I think thats all our comments are at this point in time.

Maxwell Krakowiak: It's TBD; you know, exactly how the timing of that plays out. I think the, you know, the comments on our call, were that we're going to be, you know, more opportunistically aggressive on the share we're purchasing. And I think that's what all our comments are at this point in time. Yeah, I mean, that's just to add to that; it's just the existing authorization that we have.

Prahlad R. Singh: Yeah, I mean, that's just to add to that. It's just the existing authorization that we have. But more broadly, you know, just looking at our current valuation and where we think we are headed in the future, the return on buying back our stock makes a lot more sense to deploy capital around that, particularly if you look at the continued elevation of M&A candidates. We honestly don't expect this valuation disconnect opportunity to last forever. So we plan to be aggressive while it lasts.

Prahlad R. Singh: Yeah, so in terms of the 330, Puneet, that is just the authorization we have left in our share repurchase program. It's TBD, you know, exactly how the timing of that plays out. I think that, you know, the comments on our call were that we're going to be, you know, more opportunistically aggressive on the share repurchasing. And I think that's what all our comments are at this point in time. Yeah, I mean, that's just too much.

Speaker Change: I mean, that's just to add to that just the existing authorization that we have but more broadly just looking at our current valuation and where do you think we are headed in the future.

Prahlad Singh: But for me, more broadly, you know, just looking at our current valuation and where we think we are headed in the future. You know, the return on buying back as talk makes a lot more sense to deploy capital round that particularly, you know, if you look at the continued elevation for M&A candidates. You know, and we honestly don't expect this valuation disconnect opportunity to last forever. So we plan to be aggressive while it does.

Speaker Change: Return on buying back our stock makes a lot more sense to deploy capital around that particularly.

Speaker Change: You look at the continued elevation for M&A candidates.

Speaker Change: I honestly don't expect this valuation disconnect opportunity to last forever. So we plan to be aggressive while it does.

Unknown Executive: Carol, let's help you guys. Thank you.

Puneet Sudha: Got it. That's helpful, guys. Thank you.

Speaker Change: Got it that's helpful guys. Thank you.

Vijay Kumar: Our next question comes from Vijay Kumar with Evacore ISI. Your line is open.

Vijay Muniyappa Kumar: Our next question comes from Vijay Kumar with Evercore ISI. Your line is open. Please go ahead.

Speaker Change: Our next question comes from Vijay Kumar with Evercore ISI. Your line is open. Please go ahead.

Vijay Kumar: Please go ahead. Fantastic.

Vijay Muniyappa Kumar: Fantastic. Good morning, Prahlad.

Vijay Muniyappa Kumar: Fantastic Good morning, <unk>, Thanks for taking my question.

Vijay Kumar: Good morning, Prala. Thanks for taking my question. One on the second half organic revenue phase in. I just want to confirm if the implied two four is high singles in the later to that. I think I heard you say like science instrumentation was down 30% in China because of the stimulus-related delays.

Vijay Muniyappa Kumar: One on the second half organic revenue phasing.

Vijay Muniyappa Kumar: And thanks for taking my question. One on the second half, organic revenue phasing. I just want to confirm if the implied Q4 is high singles. In related to that, I think I heard you say life science instrumentation was down 30% in China because of the stimulus-related delays. Can you give some flavor on what kind of instruments they are? Are they small versus large ticket items? And what is the guide assuming for the back half on those Chinese instruments?

Vijay Muniyappa Kumar: Wanted to confirm if the implied Q4 is high singles.

Speaker Change: And related to that.

Speaker Change: I think I heard you say life science instrumentation was down 30%.

Speaker Change: In China because of the stimulus related delays can you give some flavor on what kind of instruments.

Maxwell Krakowiak: Can you give some flavor on what kind of instruments is a small versus large ticket items and when and what is the guide assuming for back half on those China instruments? Yeah, so maybe I'll start with the second one first. Vijay just on the China Life Sciences Instrumentation. So, as a reminder in our portfolio, most of the items are what we would consider bigger ticket items. The ASP is sort of 500 K plus from a life sciences instrumentation standpoint. You know, and I think as we look at the second half of the year right now, our guidance assumes it's still down mid-single digits for the second half of the year from an instrumentation standpoint.

Speaker Change: Small versus large ticket items.

Speaker Change: When.

Speaker Change: And where does the guide assuming.

Speaker Change: For back half on this China instruments.

Maxwell Krakowiak: Yeah, so maybe I'll start with the second one first, Vijay, just on the China Life Sciences instrumentation. As a reminder, in our portfolio, most of the items are what we would consider bigger ticket items. The ASP is sort of $500k plus from a life sciences instrumentation standpoint. You know, and I think as we look at the second half of the year, right now, our guidance assumes it's still down mid single digits for the second half of the year from an instrumentation standpoint. And so we'll see how that plays out.

Speaker Change: Yeah, So maybe I'll start with the second one first Vijay just on China Life Sciences instrumentation. So as a reminder, our portfolio most of the items are what we would consider bigger ticket items. The ASP is sort of 500, K plus from our life Sciences instrumentation standpoint.

Vijay Muniyappa Kumar: And I think as we look at the second half of the year right now our guidance assumes it's still down mid single digits for the second half of the year from an instrumentation standpoint.

Maxwell Krakowiak: And so we'll see how that plays out, but that's the assumption in the guidance is. I think as you look at the overall second half organic revenue ramp, you know, in the second quarter, you know, our guidance is for positive low single digits, which then implies for the fourth quarter that you're going to be looking at, you know, a high single to low double digit organic growth range in the fourth quarter. Now that Step Up has a couple different components. Half of that step up is related to instrumentation, which is really just normal seasonality between the third and the fourth quarter.

Vijay Muniyappa Kumar: So we will see how that plays out but that's the assumption in the guidance is I think as you look at the overall second half organic revenue ramp in the second quarter. Our guidance is for positive low single digits, which then implies for the fourth quarter that youre going to be looking at a high single to low double digit organic growth range in the fourth quarter.

Maxwell Krakowiak: But that's the assumption in the guidance is, I think, as you look at the overall second half organic revenue ramp, you know, in the second quarter, our guidance is for positive low single digits, which then implies for the fourth quarter that you're going to be looking at, you know, a high single to low double digit organic growth range in the fourth quarter. Now, that step up has a couple different components.

Maxwell Krakowiak: Half of that step up is related to instrumentation, which is really just normal seasonality between the third and the fourth quarter; we are not, you know, factoring in any change in market environment. Then there's another 2% of that is related to our software business, which is just the renewal timing and our pipeline, and we have good visibility into that. The remaining, you know, couple percentage points is really related to Chinese diagnostics.

Vijay Muniyappa Kumar: Now that step up has a couple of different components half of that step up is related to instrumentation, which is really just normal seasonality between the third and the fourth quarter. We are not factoring in any change in market environment. Then there is another two percentage of that is related to our software business, which is just normal timing in our pipeline and we are.

Maxwell Krakowiak: We are not, you know, factoring in any change in market environment. Then there's another two percent of that is related to our software business, which is just the renewal timing in our pipeline, and we have good visibility into that. The remaining, you know, a couple percentage points is really related actually to China diagnostics, and the two pieces there are one. It's an easier comp for immunodagnastics in the fourth quarter, and then if you already talked about, we are anticipating the step up in our neobusiness in the fourth quarter in China.

Vijay Muniyappa Kumar: Good visibility into that.

Vijay Muniyappa Kumar: The remaining couple of percentage points is really related actually to China diagnostics and the two pieces. There one it's an easier comp for immuno diagnostics in the fourth quarter and then if you already talked about we are anticipating the step up in our knee business in the fourth quarter in China.

Maxwell Krakowiak: And the two pieces there are one, it's an easier comp for immunodiagnostics in the fourth quarter. And then, as we already talked about, we are anticipating a step up in our neo business in the fourth quarter in China.

Vijay Kumar: That's extremely helpful, Max, and maybe one on that margins here.

Maxwell Krakowiak: It's extremely helpful, Max. And maybe one on margins here, pretty impressive free cash out performance and early execution. I think your cost actions were 100 million last year. Did we pull forward the savings? Like, what is the total? [inaudible] Yeah, I think so.

Max: That's extremely helpful Max.

Speaker Change: Maybe one on margins here pretty impressive free cash app performance and execution.

Maxwell Krakowiak: A pretty impressive free cashier performance and early execution. The I think your cost actions was 100 million last year. Did we pull forward the savings like what is the total cost actions benefit. We're expecting for fiscal 24 and what is remaining for fiscal 25. Yeah, I think so.

Speaker Change: I think.

Speaker Change: Your cost actions is a $100 million last year.

Speaker Change: Did we pull forward the savings like what is what is the total.

Speaker Change: Cost actions benefit we're expecting for fiscal <unk>.

Speaker Change: 24, and what is remaining for fiscal 'twenty five.

Maxwell Krakowiak: Yeah, I think so. Just as a reminder to Vijay, when we came into this year, and we were calling for flat operating margin performance year over year, the dynamics at play were one, the cost actions we took at the end of last year, but then two, the return of the variable comp, which we said should normalize in 2024 versus the compression that it faced in 2023. So those were the assumptions coming into this year.

Speaker Change: Yes, I think so just as a reminder to Vijay when we had come into this year and we are calling for flat operating margin performance year over year. The dynamics at play with one the cost actions. We took at the end of last year, but then to the return of the variable comp, which we said should normalize in 2024 versus the compression that had faced.

Maxwell Krakowiak: Just as a reminder to Vijay, when we had come into this year and we are calling for flat operating margin performance year over year, the dynamics that play with one is the cost sections we took at the last end of last year, but then to the return of the variable comp, which we said should normalize in 2024 versus the compression that had faced in 2023. So those were the assumptions coming into this year. I think what you're seeing is just continued execution on a lot of the operational initiatives we have. I talked about some of the synergies and integration work that continues to be ongoing.

In 2023, so those were the assumptions coming into this year I think what Youre seeing is just continued execution on a lot of the operational initiatives. We have talked about some of the synergies and integration work that continues to be ongoing and I think again as we look again in the outer years from a margin standpoint. This is what really gives us the confidence in our ability to execute.

Maxwell Krakowiak: I think what you're seeing is just continued execution on a lot of the operational initiatives we have. I talked about some of the synergies and integration work that continues to be ongoing. And I think, again, as we look again at the outer years, from a margin standpoint, this is what really gives us the confidence in our ability to execute and sort of reach our ultimate margin entitlement from an overall company perspective.

Maxwell Krakowiak: And I think again, as we look again in the outer years from a margin standpoint, this is what really gives us the confidence in our ability to execute and I sort of reach our ultimate margin entitlement from an overall company perspective.

Speaker Change: And I would sort of reach our ultimate margin entitlement from an overall company perspective.

Matt Sykes: Thanks, Kay.

Speaker Change: Got it thanks guys.

Matt Sykes: Our next question comes from Matt Sykes with Goldman Sachs. Your line is open.

Matthew Carlisle Sykes: Our next question comes from Matt Sykes with Goldman Sachs. Your line is open, please go ahead.

Speaker Change: Our next question comes from Mac Sykes with Goldman Sachs. Your line is open. Please go ahead.

Matt Sykes: Please go ahead.

Matt Sykes: Morning, thanks for taking my questions. Maybe just focus on applied genomics. For a minute, you mentioned the weaknesses due to the dude farmer demand. Just curious, the dynamics of the applied genomics businesses relates to farmer demand.

Matthew Carlisle Sykes: Morning, thanks for taking my questions. Maybe I will just focus on applied genomics. For a minute, you mentioned the weakness was due to subdued pharma demand. I was curious about the dynamics of the applied genomics business as it relates to pharma demand. Should we see a similar level of recovery and cadence for that recovery versus what you're saying in life sciences? Or is there something about the applied genomics business? that you think might take longer for the recovery to take hold in that specific business?

Matthew Carlisle Sykes: Good morning, Thanks for taking my questions, maybe just focus on applied genomics for a minute you mentioned the weakness is due to.

Matthew Carlisle Sykes: Subdued pharma demand just curious the dynamics of the applied genomics business as it relates to pharma demand should we see a similar level of recovery in cadence for that recovery versus what you are saying in life sciences or theres something about the applied genomics business.

Maxwell Krakowiak: And should we see a similar level of recovery and cadence for that recovery versus what you're saying in life sciences, or is there something about the applied genomics business that you think might take longer for the recovery to take hold in that specific business. Yeah, hey, Matt, from an applied genomics perspective, I don't know if there's anything specifically unique to that business that I would call out. I think, as you've been following the company over the past six, seven quarters, it's been a meaningful headwind for us as an overall company. The business has been facing two headwinds.

Speaker Change: Think might take longer for the recovery to take hold in that specific business.

Maxwell Krakowiak: Yeah, hey, Matt. From an applied genomics perspective, I don't know if there's anything specifically unique to that business that I would call out. But I think as you've been following the company over the past, you know, six, seven quarters, it's been a meaningful headwind for us as an overall company. The business has been facing two headwinds. One is on the pharma biotech side.

Speaker Change: Yeah, Hey, Matt from an applied genomics perspective, I don't know if theres anything specifically unique to that business that I would call out I think as you've been following the company over the past.

Speaker Change: Six seven quarters, it's been a meaningful headwind for us as an overall company. The business has been facing two headwinds one is on the pharma biotech side and then the second was the build out of the installed base on the clinical side during the Covid period ramp I think what we're seeing here is in the second half of the guidance as we are assuming a similar market.

Maxwell Krakowiak: One is on the farmer biotech side, and then the second was the build out of the install dates on the clinical side during the COVID period ramp. I think what we're seeing here is, in the second half of the guidance, we are assuming a similar market dynamics that we saw in the first half of the year. We continue to work through those two headwinds, and really the function of the performance in the second half is your same market environment and normal seasonality in the fourth quarter. Yeah, Matt, if you recall, I think this product line grew close to 50% two years in a row.

Maxwell Krakowiak: And then the second was the build out of the install dates on the clinical side during the COVID period ramp. I think what we're seeing here is that in the second half of the guidance, we are assuming a similar market dynamics that we saw in the first half of the year. We continue to work through those two headwinds. And really, the function of the performance in the second half is just the same market environment and normal seasonality in the fourth quarter. No matter, if you recall.

Speaker Change: Dynamics that we saw in the first half of the year, we continue to work through those two headwinds and we're really the function of the performance in the second half as you say market environment and normal seasonality in the fourth quarter no matter. If you recall I think this product line grew close to 50% two years in a row. So.

Prahlad R. Singh: Yeah, Matt, if you recall, I think this product line grew close to 50% two years in a row. So you know, this is, hopefully, what we are seeing is now the bottoming out of it.

Maxwell Krakowiak: So, you know, this is hopefully what we are seeing is now the bottom and out of it.

This is hopefully what we are seeing is now the bottoming out of it.

Maxwell Krakowiak: Thank you. And then Max, just for modeling, just would love to get what you achieved in terms of pricing in the quarter and what your expectations for pricing are embedded in the guide for the balance of the year. Yeah, so from a pricing perspective in the second quarter, similar to the first quarter, I think we mentioned around approximately a hundred basis points of price.

Speaker Change: Got it. Thank you and then Max just for modeling just would love to get what you achieved in terms of pricing in the quarter and what your expectations for pricing are embedded in the guide for the balance of the year.

Matthew Carlisle Sykes: And then, Max, just for modeling purposes, just would love to get what you achieved in terms of pricing in the quarter and what your expectations for pricing are embedded in the guide for the balance. Yeah, so from a pricing perspective,

Maxwell Krakowiak: Yeah, so from a pricing perspective in the second quarter, similar to the first quarter, I think we mentioned it was around approximately 100 basis points of price. You know, I think we have a similar assumption for the second half of the year. I would just say overall, obviously, given the market environments, pricing is, I would say, more challenged than what it is in a normal year, but we continue to still get a price on the life sciences side.

Max: Yeah, so from a pricing perspective in the second quarter similar to the first quarter and the first quarter I think we mentioned it was around approximately 100 basis points of price I think we have a similar assumption for the second half of the year I would just say overall, obviously given the market environment pricing is I would say more challenged than what it is in a in a normal.

Maxwell Krakowiak: You know, I think we have a similar assumption for the second half of the year. I would just say overall, obviously, you know, given the market environments, pricing is, I would say, more challenged than what it is in a normal year, but we continue to still get a price on the life sciences side. Thank you very much.

Speaker Change: <unk>, but we continue to still get price on the on the life Sciences side.

Speaker Change: Okay.

Speaker Change: Great. Thank you very much.

Daniel Brennan: We now turn to Dan Brennan with TD Cohen. Your line is open.

Daniel Gregory Brennan: We now turn to Dan Brennan with TD Cohen. Your line is open. Please go ahead. Okay.

Speaker Change: We now turn to Dan Brennan with TD Cowen. Your line is open. Please go ahead.

Daniel Brennan: Please go ahead. Great. Thank you for the questions, guys.

Daniel Gregory Brennan: Great. Thank you for the questions guys. Congratulations on the quarter. If we can just go back to reagents, I know it came up earlier in the call, given the size of that business for you. Could you just provide a little more color on BioLegend versus Legacy and kind of how we think about reagents in Q3, Q4, and kind of any visibility you can provide on that front.

Daniel Gregory Brennan: Great. Thank you for the questions guys congrats on the quarter.

Daniel Brennan: Congrats on the quarter. If we can just go back to reagents, I know it came up earlier in the call, given the size of that business for you. Could you just provide a little more color on bioludgen versus legacy and kind of how we think about, you know, reagents Q3, Q4 and kind of any visibility to provide on that front. Yeah, I think we've been pretty consistent in not breaking out individual business units or sub-brands. Obviously, by a legend, again, is more than 50% of our overall reagents portfolio. I would say it's probably the best performing piece of our overall reagents portfolio.

Daniel Gregory Brennan: If we can just go back to reagents I know it came up earlier in the call given the size of that business for you could you just.

Speaker Change: Can you provide a little more color on <unk> versus legacy and kind of how we think about reagents Q3 Q4.

Speaker Change: Any visibility you can provide on that front.

Maxwell Krakowiak: Yeah, I think we've been pretty consistent in not breaking out individual business units or sub brands. Obviously, BioLegend, again, is more than 50% of our overall reagent portfolio. I would say it's probably the best performing piece of our overall reagents portfolio. I think that's probably all the color we provide. And I think to further echo the comments that Prahlad previously made about, you know, the second half assumptions: we're assuming essentially the same market environment that we faced here in the first half, and there's no real meaningful change in volume assumptions between the first half and the second half.

Speaker Change: Yes, I think we've been pretty consistent and not breaking out individual business units, our sub brands, obviously by Allegiant again, it's more than 50% of our overall reagents portfolio I would say, it's probably the best performing piece of our overall reagents portfolio I think thats probably.

Daniel Brennan: I think that's probably all the color we've provided. And I think to further echo the comments that Prahad previously made about, you know, the second half assumptions, we're assuming essentially the same market environment that we face here in the first half. And there's no real meaningful change in volume assumptions between the first half and second half. Yeah, man, there is nothing here that is competitive driven. I mean, what we are seeing is sporadic market softness because of cyclosures and consolidations. Got it.

Speaker Change: The color we provided I think to further echo the comments that broad previously made about the second half assumptions, we're assuming essentially the same market environment that we face here in the first half and there is no real meaningful change in volume assumptions between the first half and second half.

Prahlad R. Singh: You know, there is nothing here that is competitive driven. I mean, what we are seeing is sporadic market softness because of site closures and consolidation.

Speaker Change: Yes, there is nothing here that is competitive driven I mean, what we are seeing is what I bake market softness because of site closures and consolidations.

Daniel Gregory Brennan: Got it. Okay.

Speaker Change: Got it okay.

Daniel Brennan: Okay.

Prahlad Singh: Maybe moving over to M&A, and there's been more activity, year to date, kind of in the sector, someone conventional, like out of Chapter 11. But, you know, I don't want recently announced it, you know, presizable deal. Just wondering, I know that's an important part of your go forward. Kind of, can you speak to kind of what your pipeline looks like there? Maybe it's feasible. Something could be executed in the next six or 12 months and just give us some context around, you know, how sizable you're willing to go for the right deal. Yeah, I think the way I would look at it, Matt, you know, then, is that we still feel that the valuations continue to be elevated for the M&A candidates.

Speaker Change: Moving over to M&A, there's been more activity year to date kind of in the sector. Some unconventional I kind of chapter 11, but.

Speaker Change: I don't want recently announced a pretty sizable deal just wondering I know that's an important part of your go forward kind of can you speak to kind of what your pipeline looks like there maybe is it feasible something could be executed in the next six to 12 months and just give us some context around.

Speaker Change: How sizable youre willing to go for the right deal.

Prahlad R. Singh: Maybe moving over to M&A. You know, there's been more activity year to date in the sector, some unconventional, like out of Chapter 11. But you know, Agilent recently announced that, you know, pretty sizable deal. Just wondering, I know that's an important part of your go forward, kind of, can you speak to kind of what your pipeline looks like there? Maybe it's feasible, something could be executed in the next 6 to 12 months, and just give us some context around, you know, how sizable you're willing to go for the right deal?

Speaker Change: Yeah, I think the way I would look at it Matt is that we are.

Speaker Change: We still feel that the valuations continue to be elevated for the M&A candidates. We continue to have a fertile pipeline and we continue to build on the relationships, but I don't think youre going to see us do any sizable side.

Daniel Gregory Brennan: Yeah, I think the way I would look at it, Matt, you know, Dan is that we still feel that the valuations continue to be elevated for the M&A candidates, we continue to have a fertile pipeline, and we continue to build on the relationships. But I don't think you're going to see us do any sizable side or size M&A in the near future. You know, I think we talked about the share buyback, where we will have our focus on to continue to deploy capital in the near term.

Prahlad Singh: We continue to have a fertile pipeline, and we continue to build on the relationships, but I don't think you're going to see us do any sizable side or size M&A in the near future. You know, I think we talked about the share buyback where we will have our focus on to continue to deploy capital in the near term. Got it.

Speaker Change: Is M&A in the near future I think we talked about the share buyback when we will have a focus on to continue to deploy capital in the near term.

Speaker Change: Got it okay. Thanks a lot.

Prahlad Singh: Okay. Thanks a lot.

Prahlad Singh: Yeah.

Speaker Change: Yes.

Catherine Schulte: Our next question comes from Catherine Schulte with Bed.

Catherine Walden Ramsey Schulte: Got it. Okay. Thanks a lot. Yeah. Our next question comes from Catherine Schulte.

Catherine Walden Ramsey Schulte: Our next question comes from Catherine Schulte with Baird. Your line is open, please go ahead. Hey guys, thanks for the questions. First, just a modeling question. How should we think about growth by segment for the third quarter and the full year?

Speaker Change: Our next question comes from Catherine Schulte with Baird.

Catherine Schulte: Your line is open. Please go ahead. Hey, guys, thanks for the questions.

Speaker Change: Line is open. Please go ahead.

Speaker Change: Okay.

Catherine Walden Ramsey Schulte: Hey, guys. Thanks for the questions first just a modeling question how should we think about growth by segment for the third quarter and the full year.

Catherine Schulte: First, just a modeling question. How should we think about growth by segment for the third quarter in the whole year? Yep. Hey, Catherine. So, on the growth by segment for the third quarter for life sciences, we're anticipating to be roughly flat overall in the third quarter, and on the diagnostic side. Positive low to mid single-digit growth for the third quarter. If you were to compare that overall for the full year, that would bring life sciences then to flat to slightly down from an organic growth perspective and the diagnostic side. It would again sort of be in the low to mid single digit range.

Maxwell Krakowiak: Yep. Hey Catherine. Hope you're doing well. So on the growth by segment for the third quarter, for life sciences, we're anticipating it to be roughly flat overall in the third quarter. And on the diagnostic side, positive, low to mid single-digit growth for the third quarter. If you were to compare that overall for the full year, that would bring life sciences then to flat, to slightly down. From an organic growth perspective on the diagnostic side, it would again sort of be in the low to mid single digit range. All right, and then I guess.

Speaker Change: Yes, Hey, Catherine hope, you're doing well so on the.

Speaker Change: On the growth by segment for the third quarter.

Speaker Change: Life Sciences.

Speaker Change: Anticipating it to be roughly flat overall in the third quarter and on the diagnostic side positive low to mid single digits growth for the third quarter. If you were to compare to that overall for the full year that would bring life Sciences, then to flat to slightly down from an organic growth perspective on the diagnostics side, it would again sort of being the low.

Speaker Change: The mid single digit range.

Catherine Schulte: All right.

Alright, perfect and then I guess, if you do exit the year at high single to low double digits in that fourth quarter.

Catherine Schulte: Perfect.

Catherine Schulte: And then I guess if you do exit the year at high single, the low double digits, not fourth quarter, you know, how do you think about how that's you are putting into 25? I know it's still early now, and there are some comp dynamics that are going on there. So yes, just how will those comps change as we head into next year as we try to level set. Thanks. Yeah, Catherine, I think the way the way I would look at this is we really feel that the worst is behind us. As I said earlier, we continue to see more encouraging signs just from our recent conversations with customers, particularly in the US. But, you know, I wouldn't say that we've gone to full normalization yet.

Speaker Change: Do you think about how that sets you up heading into 'twenty five.

Speaker Change: Early now and there are some comp dynamics that are going on there. So yes, just how old is comp change as we head into next year as we kind of level set.

Prahlad R. Singh: Yeah, Catherine, I think the way I would look at this is that we really feel that the worst is behind us, as I said earlier, and we continue to see more encouraging signs, just from our recent conversations with customers, particularly in the US, but you know, I wouldn't say that we've gone to full normalization yet. I mean, in terms of what we would expect to see in 2025, I think we'll have to wait till our analyst day, which is in late November, to give you a bigger, deeper insight into what we think.

Speaker Change: Yes got it and I think the way I.

Speaker Change: We would look at this is we really feel that the worst is behind us as I said earlier, and we continue to see more than encouraging signs.

Speaker Change: Our recent conversations with customers, particularly in the U S but.

Speaker Change: I wouldn't say that we've gone to full normalization yet.

Catherine Schulte: I mean, I think in terms of what we would expect to see in 2025, I think we'll have to wait till our analyst day, which is in late November, to give you a bigger, deeper insight into what we think. Great.

I think in terms of what we would expect to see.

Speaker Change: In 2025, I think we will have to wait till analyst day, which is in late November to give you a bigger deeper insight into what we think.

Speaker Change: Okay, great. Thank you.

Luke Sergott: Thank you. Our next question comes from Luke Sergott, with Barclays.

Luke England Sergott: Our next question comes from Luke Sergott with Barclays. Your line is open, please go ahead.

Luca <unk>: Our next question comes from Luca <unk> with Barclays. Your line is open. Please go ahead.

Luke Sergott: Your line is open. Please, go ahead. Great. Thanks, guys. I kind of want to follow up on the applied genomics. That seems to be, you know, you continue to go through the headwinds there, but it seems to continue to get a little better and better. And so as the confidence comes on, like, can you break out, you know, from a, you know, we had the, the Revodyomics piece to start the year that was a slight headwind and you're getting that coming back. And then you have the extract RNA, DNA extraction kits, things like that.

Luke England Sergott: Great, thanks, guys. I kind of want to follow up on applied genomics.

Great. Thanks, guys.

Speaker Change: Kind of want to follow up on the applied genomics.

Speaker Change: That seems to be you.

Speaker Change: You continue to go through the headwinds there, but it seems to continue to get a little better and better and so as the confidence comes on like can you break out from a we had the revenue mix piece to start the year that was a slight headwind in that youre getting that coming back and then you have the extra RNA DNA extraction kits things.

Luke Sergott: So talk about the different pieces within that, within that sub segment that are, that are kind of coming back and what it's going to take to, to continue that acceleration. Yeah.

Speaker Change: That so talk about the different pieces within that within that sub segment that are that are kind of coming back and what it's going to take to to continue that acceleration.

Luke England Sergott: That seems to be, you know, it, you continue to go through the headwinds there, but it seems to continue to get a little better and better. And so, as confidence comes on, like, can you break out, you know, from, you know, we had the Revvity omics piece to start the year, that was a slight headwind, and you're getting that coming back. And then you have the RNA extraction kits, DNA extraction kits, things like that. So talk about the different pieces within that subsegment that are kind of coming back and what it's going to take.

Maxwell Krakowiak: Yeah, hey, Luke. So just one clarification before diving into the Revvity omics piece that you referred to is actually part of our reproductive health business, not applied genomics. So just one clarification there. I always forget that. I'm sorry about that. Yeah. That's all right. No worries.

Luke: Yeah, Hey, Luke.

Luke Sergott: Hey, Luke. So just one clarification before diving into the, the, the Revodyomics piece that you referred to is actually part of our reproductive health business, not applied genomics. Just one clarification there. I guess that. Sorry about that. Yep. Sorry. No worries. And I think, as you look at it, applied genomics, right? I think again, there's really two sort of main pieces of this business, right? You do have the RNA DNA extraction. And then on the other side, you kind of have the, the liquid handling portion of the business. I think as you look at those two, we've definitely seen the headwinds on the extraction piece a bit quicker right now.

Speaker Change: So just one clarification before diving into the remedy all mixed piece that you referred to is actually part of our reproductive health business not applied genomics. So just one clarification there sorry.

Sorry about that yes.

Maxwell Krakowiak: And I think as you looked at it, applied genomics, right? I think again, there's really two sort of main pieces of this business, right? You do have the RNA and DNA extraction.

Speaker Change: Alright.

Speaker Change #100: No worries and I think as you looked at it applied genomics rates I think again, there's really two sort of main pieces of this business right. You do have the RNA DNA extraction and then on the other side you kind of have the liquid handling portion of the business I think as you look at those two we are definitely seeing the headwinds on the extraction piece.

Maxwell Krakowiak: And then on the other side, you kind of have the liquid handling portion of the business. I think as you look at those two, we've definitely seen the headwinds on the extraction piece a bit quicker. Right now.

Luke England Sergott: I think that's again, that was the piece where it really got built up through the COVID install base years; that part of the business has been performing better and has been returning to growth. I think where we're still continuing to see the challenges is really more so on the liquid handling side of things. And that is where I think now, as we get into the second half of the year, from a comp dynamic perspective, we are expected to start to see that rich start to return to growth.

Speaker Change #100: Abate quicker right now I think Thats again that was the piece, we're really got built up through the Covid installed base years that part of the business has been performing better and has been returning to growth I think we're still continuing to see the challenges is really more so on the liquid handling side of things.

Luke Sergott: I think that's again, that was the piece where really got built up through the COVID install base years. That part of the business has been performing better and has been returning to growth. I think where we're still continuing to see the challenges is really more so on the liquid handling side of things. And that is where I think now, as we get into the second half of the year, from a comp dynamic perspective, we are expected to start to see that red start to return to growth again. Great.

Speaker Change #100: And that is where I think now as we get into the second half of the year from a comp dynamic perspective, we are expected to start to see that start to return to growth again.

Luke England Sergott: Great, thanks. And then as you think about the life cycle and the licensing comp on the reagents that you guys face, can you talk about, you know, what that licensing or technology license was for? I thought that you guys mostly did your own internal antibodies and you didn't license them out. And I guess you're licensing them out to others, but kind of just walk us through the various, you know, details there so we can get a better understanding of what goes on.

Speaker Change #101: Great. Thanks, and then as you think about on the life side and with the licensing com.

Maxwell Krakowiak: Thanks.

Maxwell Krakowiak: And then as you think about on the life side and, and, and with the licensing comp on the reagents that you guys say, can you talk about, you know, what that licensing, or technology license, it was for actually, because I thought that you guys mostly did your own internal antibodies, you know, license them out, and I guess you're licensed them out to others. But kind of just walk us through the various, you know, details there and get a better understanding of what goes on.

Speaker Change #102: Comp on the regions that you guys face can you talk about what that licensing.

Speaker Change #103: Our technology license for actually because I thought that you guys, mostly did your own internal antibodies and license the amount and I guess your license them out to others, but kind of just walk us through the various details there and get a better understanding of what goes on.

Maxwell Krakowiak: Yeah, from a comp perspective that Max pointed out earlier, look, that was the one that he had announced at the pinpoint base editing technology, which we had licensed to AstraZeneca in the second quarter of last year. So specifically, that was the one. The other licensing technologies that we license are around AAB vectors, viral vectors, and lentiviruses that we license out from our Syrian biotech acquisition. So there are three or four components where we focus around licensing opportunities, just to sort of give you a sense of what they have come for. Yeah, that's helpful.

Prahlad R. Singh: You know, from the communicative perspective that Max pointed out earlier, Luke, that was the one that we had announced, the pinpoint base editing technology, which we had licensed to AstraZeneca in the second quarter of last year. So specifically, that was the one. The other licensing technologies that we license are around AAV vectors, viral vectors, and lentiviruses that we license out from our Syrian biotech acquisition. So there are three or four components where we focus on licensing opportunities, just to sort of give you a sense of what they cover.

Speaker Change #104: From a comp perspective that Max point it out earlier look that was the one that we had announced the pinpoint base editing technology, which we had licensed to astrazeneca in the second quarter of last year. So specifically that was the one.

Speaker Change #104: Other licensing technologies that we license out around AAV vectors viral vectors.

Speaker Change #104: And lentivirus is that we license out from our city and biotech acquisition. So there are three or four components, where we focus around licensing opportunities.

Speaker Change #104: Just sort of give you a sense of what their account for us.

Luke England Sergott: Yeah, that's helpful. Thanks.

Speaker Change #107: Yeah that's helpful. Thanks.

Maxwell Krakowiak: Thanks.

Michael Ryskin: We now turn to Michael Risken with Bank of America.

Michael Leonidovich Ryskin: We now turn to Michael Ryskin with Bank of America. Your line is open, please go ahead.

Speaker Change #104: We now turn to Michael Riskin with Bank of America.

Michael Ryskin: Your line is open. Please go ahead. Great. Thanks for taking the question, guys.

Speaker Change #106: Line is open. Please go ahead.

Michael Leonidovich Ryskin: Great. Thanks for taking the question, guys. Max, a couple of times in your prepared remarks and in your Q&A, you talked about seasonality in the fourth quarter and how, you know, that explains a lot of the ramp from 3Q to 4Q, both for Total Company and for some of the instruments business. Just curious what's driving that, and what exactly do you mean by that? I mean, obviously, we know your typical seasonality, but is that attributed to the budget flush?

Michael Leonidovich Ryskin: Great. Thanks for taking the question guys.

Michael Ryskin: Max, a couple of times in your, in your prepare marks and in your Q&A, you talked about seasonality in the fourth quarter and how that explains a lot of the ramp from 3K to 4K, both for a total company and for some of the instruments business. Just curious what's driving that, and what exactly do you mean by that? I mean, obviously, we know your typical seasonality, but if that attributed to budget flush, if that attributed to customers coming back, because if farm and biotech is still a little bit pressured and sounds like it's going to be pressured through the rest of the year, and if China's a little pressured, maybe that seasonality won't come back to the normal effect that you see in prior years.

Max: Max a couple of times in your in your prepared remarks, and Q&A you talked about seasonality in the fourth quarter and how that explains a lot of the ramp from <unk> to <unk>, both for total company and for some of the instruments business.

Speaker Change #108: Just curious, what's driving that and what exactly do you mean by that.

Speaker Change #109: We know you are.

Speaker Change #110: Typical seasonality, but is that attributed to budget flush at that attributed to customers coming back because of pharma and biotech is still of a pressured and sounds like the pressure through the rest of the year and if China's a little pressured maybe that's seasonality won't come back to the normal effect that you see in prior years, just trying to delve deeper into what's driving that comp.

Michael Leonidovich Ryskin: Is that attributed to customers coming back? Because if Farman Biotech is still a little bit pressured and sounds like it's going to be pressured through the rest of the year, and if China's a little pressured, maybe that seasonality won't come back to the normal effect that you see in prior years. Just trying to delve deeper into what's driving that confidence. Thanks.

Maxwell Krakowiak: Just trying to delve deeper into what's driving that confidence. Thanks. Yeah, Amy. So I would say it's probably a little bit of a combination of the things that you mentioned in your opening question there. I think one is the conversations we are having with our customers and what the pipeline looks like. I think two, just from a normal buying, buying behavior standpoint, instruments are the largest volume-wise in a fourth quarter. And so I think it's the combination of those two things that's really leading to our expectations for the fourth quarter.

Speaker Change #110: Thanks.

Maxwell Krakowiak: Yeah. So I would say it's probably a little bit of a combination of the things that you mentioned in your opening question. I think one is the conversations we are having with our customers and what the pipeline looks like. I think two, just from a normal buying behavior standpoint, instruments are the largest volume-wise in the fourth quarter. And so I think it's the combination of those two things that's really leading to our expectations for the fourth quarter.

Speaker Change #111: Yeah, Hey, Mike So I would say, it's a it's probably a little bit of a combination of the things that you mentioned.

Speaker Change #112: You mentioned in your opening question. There I think one is the conversations we're having with our customers and what the pipeline looks like I think too just from a normal by buying behavior standpoint instruments are the largest volume wise in the fourth quarter and so I think it's a combination of those two things that's really leading to our expectations for the.

Speaker Change #112: Fourth quarter.

Prahlad Singh: Okay, thanks. And then on China specifically, you talked a little bit about Amino ZX and reproductive health, but excluding those, it sounded like China got a little bit worse as the quarter went on. I think you specifically said that, and it sounds like your expectations for China are now lower than they were before. I realize a lot of this hinges on stimulus timing and magnitude, and that's a lot unknown. But just curious, you know, your thoughts on China bigger picture.

Michael Leonidovich Ryskin: Okay, thanks. And then, on China specifically, you talked a little bit about immuno DX and reproductive health, but excluding those, it sounded like China got a little bit worse as the quarter went on. I think you specifically said that, and it sounds like your expectations for China are now lower than they were before. I realize a lot of this hinges on stimulus, timing, and magnitude, and that's still a lot unknown. But just curious, you know, your thoughts on China, the bigger picture, you know, not just the next couple months, you know, the ability of that end market to come back in 2025, the various outcomes possible with the stimulus, just take a step back and sort of holistically talk us through what you're seeing in China. Thanks.

Speaker Change #114: Okay. Thanks, and then.

Speaker Change #113: On China, specifically, you talked a little bit about.

Speaker Change #115: The acts and reproductive health, but excluding those it sounded like China got a little bit worse as the quarter went on I think you specifically said that it sounds like your expectations for China are now lower than they were before.

Speaker Change #117: Realized a lot of this hinges on stimulus timing and magnitude and that a lot of unknown, but just curious your thoughts on China bigger picture not just the next couple of months.

Prahlad Singh: You know, not just the next couple of months, you know, the ability of that end market to come back in 2025, the various outcomes possible with the stimulus, just take a step back and sort of holistically talk us through what you're seeing in China. Thanks. You know, I think the way to look at it is as we take a step back and strategically, for us, China continues to be a very important market at 16, 17% of your revenue. As you know, you know, Amino diagnostics continues to be very strong in that market. 10% of our business that is diagnostics reproductive health, as we've talked about earlier, we expect this year to see a bump up in both ways given the year of the dragon.

Speaker Change #115: The ability of that end market to come back in 2025.

Speaker Change #116: Various outcomes possible with the stimulus just take a step back and sort of Holistically talk us through what youre seeing in China. Thanks.

Speaker Change #115: Okay.

Prahlad R. Singh: You know, I think the way to look at it, as we take a step back and strategically for us, China continues to be a very important market. It's 16-17% of our revenue, and as you know, immunodiagnostics continues to be very strong in that market. 10% of our business there is diagnostics, reproductive health, and as we've talked about earlier, we expect this year to see a bump up in birth rates given the year of the dragon.

Speaker Change #117: Yes, I think the way to look at it as we take a step back and strategically for US China continues to be a very important market at 16, 17% of our revenue as you know.

Speaker Change #117: You know diagnostics continues to be very strong in that market, 10% of our business that is diagnostics.

Speaker Change #117: <unk> health as we've talked about on the year, we expect this year to see a bump up in both rates given the out of the Dragon.

Prahlad Singh: And I think overall, if you take a step back, you know, especially with the stimulus funding coming in either by the end of the year or all the next year, it is continuing; it is going to continue to drive growth, and that I don't believe that that is going to slow down. Keep in mind, the product portfolio is differentiated enough that we had high single-digit growth last year. So we are coming off that comp in that marketplace. So we feel very good about China, and it is one of our strategic markets. So nothing strategically has changed for us based on what you saw in the second quarter.

Prahlad R. Singh: And I think overall, if you take a step back, especially with the stimulus funding coming in, either by the end of the year or early next year, it is continuing, it is going to continue to drive growth, and I don't believe that that is going to slow down. Keep in mind, our product portfolio is differentiated enough that we had high single-digit growth last year, so we are coming off that comp in that marketplace. So we feel very good about China, and it is one of our strategic markets. So, based on what you saw in the second quarter, nothing strategically has changed for us.

Speaker Change #117: And then I think overall, if you take a step back, especially with the stimulus funding coming in.

Speaker Change #117: By the end of the year or early next year. It is continue it is going to continue to drive growth and that I don't believe that that is going to slow down keep in mind, our product portfolio is differentiated announced that we had high single digit growth last year.

Speaker Change #117: So we are coming off that comp in that marketplace. So we feel very good about China and it is one of our strategic market. So nothing strategically has changed for US based on what you saw in the second quarter.

Prahlad Singh: Thanks.

Speaker Change #117: Thanks.

Paul Knight: Our next question comes from Paul Knight with KeyBank.

Paul Richard Knight: Thanks. Our next question comes from Paul Knight with KeyBank. Your line is open, please go ahead.

Speaker Change #117: Our next question comes from Paul Knight with Keybanc. Your line is open. Please go ahead.

Paul Knight: Your line is open. Please go ahead. Thanks for the question. The biology and business, you know, we're seeing our side growth and clinical trials phase one since 2018. So maybe that's a sign things better.

Paul Richard Knight: Oh, yeah, thanks for the question. The BioLEDG

Speaker Change #119: Hi, yes, thanks for the question.

Paul Richard Knight: <unk> business.

Speaker Change #120: We're seeing on our side growth in clinical trials phase one since 2018, so maybe that's a sign things better.

Prahlad Singh: Does biology and when off phase one are they more later stage winner? I already they tend to be earlier stage. They tend to be a bit earlier stage in the pipeline. Paul, they tend to be more in the preclinical and discovery side as we are moving into the GMP capabilities. That's where there was the whole strategy around us moving into the pilot plant and then phase one side.

Speaker Change #123: This vital engine win of phase one or are they more later stage winter.

Prahlad R. Singh: They tend to be in earlier stages. They tend to be a bit earlier in the pipeline, Paul. They tend to be more on the preclinical and discovery side. As we are moving into GMP capabilities, that's where the whole strategy around us moving into the pilot plant and then phase one side. So that is where we are heading. But primarily, the primary domain the bio legend plays in is discovery and early pre-clinical. Do you think we're seeing the effect of better funding in the biopharma market?

Speaker Change #121: They tend to be earlier.

They tend to be a bit earlier stages in the pipeline Paul they tend to be more in the preclinical and discovery side.

Speaker Change #121: As we are moving into the GMP capabilities, that's where there was the whole strategy around us moving into the pilot plant and then phase one side. So that is where we are heading towards but primarily the.

Prahlad Singh: So that is where we are heading towards, but primarily the primary domain the biologian plays is in discovery and preclinical.

Speaker Change #121: Primarily.

Speaker Change #121: Domain. The biology plays is in discovery and early preclinical.

Prahlad Singh: Phil. Do you think we're seeing the effect of better funding in the, in the, they're in the biopharma market? Yeah, I mean, we've started seeing signs of the pre-revenue biotech capital funding in flux coming in. And, and, and, and as Max pointed out during one of the questions, increased conversations with our customers around, you know, opening programs and starting programs with that funding. But I think it will take a quarter or two before that material is this. Okay, thank you.

Speaker Change #121: Do you think we're seeing the effect of better funding and in the.

Speaker Change #121: They are in the Biopharma market.

Prahlad R. Singh: Yeah, I mean, we've started seeing signs of the pre-revenue biotech capital funding influx coming in. And, as Max pointed out during one of the questions, increased conversations with our customers around, you know, opening programs and starting programs with that funding. But I think it will take a quarter or two before that materializes.

Speaker Change #124: Yes, I mean, we've started seeing signs of the.

Speaker Change #124: Pre revenue biotech capital funding influx coming in and.

Speaker Change #124: As Max pointed out during one of the questions increased conversations with our customers around opening programs and stocking programs with that funding, but I think it'll take a quarter or two before that materializes.

Speaker Change #125: Okay. Thank you.

Unknown Executive: Yeah.

Speaker Change #125: Yeah.

Rachel Batonstall: We now turn to Rachel Batonstall with JP Morgan.

Paul Richard Knight: We now turn to Rachel Battenstall with J.P. Morgan. Your line is open. Please go ahead.

Speaker Change #126: We now turn to Rachel bathroom stall with J P. Morgan. Your line is open. Please go ahead.

Rachel Batonstall: Your line is open; please go ahead. Great, good morning, you guys. Thanks for taking the question. So, I want to ask another one here on instruments. You talked about how the instruments in China have been pressured from some of this air pocket related to China stimulus. So, can you remind us, within your instrument portfolio, how much of it is exposed to China versus the rest of the world? And then, just to dig it on those rest of world trends, can you talk about how customers outside of China are thinking about their capital budgets? Has that improved at all, or is that, you know, continue to be pressured here as well?

Rachel Marie Vatnsdal Olson: Great, good morning you guys. Thanks for taking the time to answer the question. So I wanted to ask another one here on instruments. You've talked about how the instruments in China have been pressured from some of this air pocket related to China's stimulus. So could you remind us within your instrument portfolio how much of it is exposed to China versus the rest of the world? And then just to dig in on those rest of the world trends, can you talk about how customers outside of China are thinking about their capital budgets? Has that improved at all, or is that, you know, continuing to be pressured here as well?

Speaker Change #127: Thanks. Good morning, you guys. Thanks for taking my question. So I wanted to ask another one here on instruments you passed not how the insurance in China has been pressuring some of the air pocket related to Chinese stimuli.

Speaker Change #128: So could you remind us whats in your internal portfolio how much of it is.

Speaker Change #129: <unk> versus rest of World and then just to dig in online is wrapped around trends can you talk about how customers outside of China are thinking about their capital budget has that improved at all or is that continuing to be pressured here as well.

Maxwell Krakowiak: Yeah, hey Rachel, so as a reminder, our overall instrumentation in China is 3% of total company revenues. So, it is, you know, in the grand scheme of things still relatively small to the overall portfolio. Yeah, as I mentioned, I think it was, you know, a challenging second quarter. You know, we'll see what happens here in the second half with stimulus. I think as we look outside to the rest of the world, we do continue to see sequential improvements in our instrumentation from the first quarter of this year. And I think as we look towards the second half, again, the conversations we're having with the customers are providing increased visibility on those pipelines and is alluding, you know, sort of leading us to our expectations for the second half of the year.

Maxwell Krakowiak: Yeah, hey, Rachel. So as a reminder, our overall investment in China is 3% of total company revenues. So, in the grand scheme of things, still relatively small in relation to the overall portfolio. Yeah, as I mentioned, I think it was a challenging second quarter. You know, we'll see what happens here in the second half with stimulus. I think, as we look outside to the rest of the world, we do continue to see sequential improvements in our instrumentation from the first quarter of this year.

Speaker Change #130: Yeah, Hey ratio so as a reminder, our overall instrumentation in China is 3% of total company revenues. So it is in the Grand scheme of things still relatively small to the overall portfolio as I mentioned I think it was.

Speaker Change #130: A challenging second quarter we.

Speaker Change #131: We will see what happens here in the second half with stimulus I think as we look outside to the rest of the world.

Speaker Change #131: Do continue to see sequential improvements in our instrumentation from the first quarter of this year and I think as we look towards the second half again the conversations we're having with the customers are providing increased visibility on those pipelines and as alluded sort of leading us to our expectations for the second half of the year.

Maxwell Krakowiak: And I think as we look towards the second half, again, the conversations we're having with the customers are providing increased visibility on those pipelines and are eluding, sort of leading us to our expectations for the second half of the year.

Speaker Change #131: Yeah.

Maxwell Krakowiak: Great. And then on my follow-up, just in terms of activity level throughout the quarter, can you walk us through what did you see with online life sciences side? And specifically, really within regions throughout the quarter.

Rachel Marie Vatnsdal Olson: Great. And then on my follow-up question, just in terms of activity levels throughout the quarter, can you walk us through what you saw on the life sciences side, and specifically really within reagents throughout the quarter, you know, in June, any better than April? And then how did that kind of continue to trend into the month of July as well?

Speaker Change #132: Great and then on my follow up just in terms of activity levels throughout the quarter can you walk us through what did you see with on the life Sciences side.

Speaker Change #133: Specifically really within region and throughout the quarter and June any better than April and then how is that kind of continuing to try and into the month of July as well.

Maxwell Krakowiak: You know, as June, any better than April, and then how is that kind of continued to trend into the month of July as well? Yeah, I don't think we want to get into intra-coated guidance, intra-quarter guidance, Rachel. I would say that over the last 45 to 60 days, we have seen continued to see the stability that we have seen. And as I mentioned, you know, the sporadicness that we had was related to, you know, two or three site closures that happened in the West Coast, and then those programs have now shifted to other sites.

Speaker Change #132: Yeah.

Prahlad R. Singh: Yeah, I don't think we want to get into intra-quarter guidance, Rachel. But I will say that over the last 45 to 60 days, we have continued to see the stability that we have seen. And as I mentioned, the sporadicness that we had was related to two or three site closures that happened on the West Coast, and then those programs have now shifted to other sites.

Speaker Change #134: Yes, I don't think.

Speaker Change #135: Want to get into inter quarter guidance.

Speaker Change #136: Quarter guidance, Rachel I would say that over the last 45 to 60 days, we have seen continued to see the stability that we have seen and as I mentioned the sporadic Miss that we had was related to.

Speaker Change #136: Towards the site closures that happened in the West Coast and then those programs have now shifted to other sites. So it's more a matter of that doesn't head count reduction than any continued trend.

Prahlad Singh: So it's more a matter of that and headcount reduction than any continued trend. You know, on the other previous question that you had on the instrument side, I think one thing to add, you know, as you recall, we totally revamped our in vivo imaging portfolio that was launched towards the end of the last year. And that's where we started to see increased conversations from customers, particularly in the U.S. We continued to be more optimistic around this being the first market where we will start seeing signs of turn around on the life sciences instrument side.

Prahlad R. Singh: So it's more a matter of that and headcount reduction than any continued trend. You know, on the other previous question that you had on the instrument side, I think one thing to add, you know, as you recall, we totally revamped our in vivo imaging portfolio that was launched towards the end of last year. And that's where we started to see increased conversations from customers. Particularly in the US, we continue to be more optimistic about this being the first market where we will start seeing signs of a turnaround on life sciences instruments.

Rachel: The previous question that you had on the instrument side I think one thing to add.

Rachel: If you recall, we've totally revamped our in vivo imaging portfolio that was launched towards the end of the last year and that's where we've started to see increased conversations from customers, particularly in the U S. We continued to be more optimistic around this being the first market, where we will start seeing signs of turnaround on the lives.

Rachel: Sciences instruments side.

Tycho Peterson: Oh, and the next question comes from Tycho Peterson with Jeffries. Your line is open.

Tycho Peterson: Our next question comes from Tycho Peterson with Jeffreys. Your line is open, please go ahead.

Speaker Change #138: Our next question comes from Tycho Peterson with Jefferies. Your line is open. Please go ahead.

Tycho Peterson: Please go ahead. Hey, thanks. Good to talk to you guys.

Tycho Peterson: Hey, thanks. It's good to talk to you guys.

Tycho Peterson: Hey, thanks.

Tycho Peterson: Talk to you guys. So maybe pull out I wanted to go back to the buyback and.

Tycho Peterson: So maybe, Paul Knight, I want to go back to the buyback, and, you know, I appreciate you have 330 million left in your current program, and you did 20 million in the second quarter.

Prahlad R. Singh: So maybe, Prahlad, I want to go back to the buyback and, you know, I appreciate you have $330 million left in your current program, and you did $20 million in the second quarter. I guess, why not do something bigger? You know, we've seen some of your peers kind of do multi-billion dollar buybacks. And then on, you know, M&A, I guess you're saying multiples are high, but can you maybe just talk about, you know, digesting prior deals? I think in the past, you talked about reverse integration of BioLegend. So maybe just talk about the kind of integration of some of the deals you've done.

Tycho Peterson: I appreciate you have $330 million left in your current program and you did 20 million in the second quarter I guess why not do something bigger than we've seen some of your peers kind of multi billion dollars buyback and then on M&A I guess youre seeing multiples are high but can you maybe just talk about digesting prior deals I think in the past you talked about reverse integration of <unk>. So maybe just talk about kind of.

Prahlad Singh: I don't want to do multimillion-dollar buyback. And then on, you know, M&A, I guess you're saying multiples are high, but can you maybe just talk about, you know, digesting prior deals. I think in the past, you talked about reverse integration of BioLegend. So maybe just talk about kind of integration or some of the deals you've done.

Speaker Change #140: Integration of some of the deals you've done.

Prahlad Singh: Sure, Tycho, good to hear your voice. On the buyback, I will say that, you know, you're right. The existing authorization. That's why I said, it's for 330 million dollars. We will, we do plan to go back to the board for authorization at the next board meeting, but I think from a valuation perspective, if you recall, Tycho, most of the acquisitions that we tend to do in our private founder, entrepreneur, owned companies. And that's where I say that the impact of the market really has not had an effect on valuation. I mean, those founders, entrepreneurs do not get impacted by a publicly listed company valuations.

Tycho Peterson: Sure, Taiko. It's good to hear your voice. On the buyback, I will say that you're right, the existing authorization, that's why I said it was for $330 million; we do plan to go back to the board for authorization at the next board meeting. But I think from a valuation perspective, if you recall, Tyco, most of the acquisitions that we tend to do are private founder entrepreneur-owned companies. And that's where I say that the impact of the markets really has not had an effect on valuation.

Sure Tycho good to hear your voice.

Speaker Change #141: On the buyback I will say that Youre right <unk>.

Speaker Change #142: Existing authorization, that's why I said is for $330 million. We will we do plan to go back to the board for authorization of the next board meeting, but I think from a valuation perspective, if you recall Tycho most of the acquisitions that we tend to do.

Private founder entrepreneur owned companies and Thats, what I would say that the impact of the market. Randy has not had an effect on valuation I mean, those funded entrepreneurs do not get impacted by a publicly listed company valuations and Thats, where we still see elevated valuations. So I think from that perspective, we will.

Tycho Peterson: I mean, those founder entrepreneurs do not get impacted by publicly listed company valuations, and that's where we still see elevated valuations. So I think from that perspective, we will continue to see that in the short term, it makes a whole lot more sense to deploy capital around buying back stock than to look at M&A candidates. And when we find the right one, we will. But, as you pointed out, we've done several acquisitions, and we are starting to see the synergistic benefits as we continue to integrate them into the company.

Prahlad Singh: And that's where we still see elevated valuations. So I think from that perspective, we will continue. We see that in the short term, it makes a whole lot more sense to deploy capital on buying back stock, then for looking at M&A candidates. And when we find the right one, we will be; but as you pointed out, you know, we've done several acquisitions, and we are starting to see the synergistic benefits as we continue to integrate them into the company. Okay.

We see that in the short term it makes a whole lot more sense to deploy capital on buying back stock then for looking at M&A candidates and when we find the right. One we will be but as you pointed out we've done several acquisitions and we are starting to see the synergies.

Speaker Change #142: Just two benefits as we continue to integrate them into the company.

Prahlad R. Singh: Okay, and then maybe a follow-up, we've had a number of questions on pharma, you know. I'm just wondering, thinking ahead about IRA and kind of what happens in the, you know, the next six, six months here. Can you maybe just talk a little bit about how you're thinking about that impact in particular?

Speaker Change #143: Okay, and then maybe a follow up you've had a number of questions on pharma I'm. Just wondering thinking ahead about IRA and kind of what happens in the next six.

Prahlad Singh: And then maybe a follow up. You've had a number of questions on pharma. You know, I'm just wondering, thinking ahead about IRA and kind of, you know, what happens in the next six, six months here. Can you maybe talk a little bit about how you're thinking about that impact in particular? Yeah, I think, you know, Michael, it's a great question, but I think that has already been planned out as pharma biotech has looked at their, you know, PNL and strategic plans for 25 and beyond. I mean, that was the exercise. I believe that they went through the fourth quarter and last year and the first quarter of this year.

Speaker Change #144: Six months here can you, maybe just talk a little bit about how you're thinking about that impact in particular.

Tycho Peterson: Yeah, I think, you know, Taiko, it's a great question. But I think that has already been planned out, as Pharma Biotech has looked at their, you know, P&L and strategic plans for 25 and beyond. I mean, that was the exercise that they went through in the fourth quarter of last year and the first quarter of this year. So that has already been in the planning stages for, I would say about, you know, two, three quarters ago.

Speaker Change #145: Yes, I think.

Speaker Change #145: Michael It's a great question, but I think that has already been planned out as pharma biotech has looked at they are.

Speaker Change #146: <unk> P&L and strategic plans for 25 and beyond I mean that was the exercise I believe that they run through the fourth quarter and loss last year in the first quarter of this year. So that has already been in the planning stages for I would say about two or three quarters ago.

Prahlad Singh: So that has already been in the planning stages for, I would say, about, you know, two, three quarters ago.

Speaker Change #145: Okay.

Prahlad Singh: Okay. And then before I hop off, just one quick clarification: you, I think on a value-based pricing, you previously expected about a 500-based point headwind. Is that still accurate in China? Yeah, wasn't necessarily tied into VBP program specifically. It was just related to, I think some of the pricing challenges we have in China overall. And that was related to our immunodagnastics portfolio that we made that comment about, as it has not been brought into scope of VBP. So it was more just a general comment of what we're seeing on the industry. Okay.

Prahlad R. Singh: Okay. And then before I hop off, just one quick clarification. I think on value-based pricing, you previously expected about a 500 base point headwind. Is that still accurate in China? Yeah, it wasn't necessarily tied into...

Speaker Change #147: Okay, and then before I hop off just one quick clarification I think on a value based pricing that you previously expected to about 500 basis point headwind is that still accurate.

Speaker Change #145: Anna.

Tycho Peterson: Yeah, it wasn't necessarily tied to the VBP program specifically; it was just related to, I think, some of the pricing challenges we have in China overall. And that was related to our immunodiagnostics portfolio that we made that comment about, as it has not been brought into the scope of VBP. So it was more just a general comment on what we're seeing in the industry.

Anna: Yes, it wasn't necessarily tied into GBP program, specifically it was just related to I think some of the pricing challenges we have in China overall.

Speaker Change #149: And that was related to our immuno diagnostics portfolio that we made that comment about as it has not been brought into scope.

Speaker Change #149: So it was more just a general comment on what we're seeing in the industry.

Speaker Change #150: Okay. Thank you.

Stephen Willoughby: Thank you.

Unknown Executive: That's all the time we have. Full questions on our hand back to Steve Willoughby for closing remarks. Thanks. Thank you, Elliot.

Stephen Barr Willoughby: That's all the time we have for questions. I'll now hand it back to Steve Willoughby for closing remarks.

Speaker Change #150: That's all the time, we have for questions I'll now hand back to Steve Willoughby for closing remarks.

Stephen Barr Willoughby: Thank you, Elliot. We look forward to catching up with everyone over the next few weeks. Talk soon.

Stephen Barr Willoughby: Thank you Elliot, we look forward to catching up with everyone over the next few weeks toxin.

Unknown Executive: We look forward to catching up with everyone over the next few weeks. Talk soon.

Operator: Ladies and gentlemen, today's call is now concluded. We'd like to thank you for your participation. You may now disconnect your lines.

Unknown Executive: Ladies and gentlemen, today's call has now concluded. We'd like to thank for your participation.

Speaker Change #152: Ladies and gentlemen, today's call is now concluded wed like to thank you for your participation you may now disconnect your lines.

Unknown Executive: You may now disconnect your lines.

Speaker Change #152: [music].