Veralto Q4 2025 Veralto Corp Earnings Call | AllMind AI Earnings | AllMind AI
Q4 2025 Veralto Corp Earnings Call
Speaker #1: You .
Operator: Hello, my name is Nikki, and I will be your conference operator this morning. At this time, I would like to welcome everyone to Veralto Corporation's Fourth Quarter 2025 Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during that time, simply press star, then 1 on your telephone keypad. If you would like to withdraw your question, please press star, then 2 on your telephone keypad. I will now turn the call over to Ryan Taylor, Vice President of Investor Relations. Mr. Taylor, you may begin your conference.
Operator: Hello, my name is Nikki, and I will be your conference operator this morning. At this time, I would like to welcome everyone to Veralto Corporation's Fourth Quarter 2025 Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during that time, simply press star, then 1 on your telephone keypad. If you would like to withdraw your question, please press star, then 2 on your telephone keypad. I will now turn the call over to Ryan Taylor, Vice President of Investor Relations. Mr. Taylor, you may begin your conference.
Speaker #2: meeting is . Your begin stand Please . about to operator . be your morning I will time , I welcome to . would like fourth At This Quarter 2025 conference call lines have been mute to .
Speaker #2: prevent any background noise this by . speaker's remarks , there will be a question and answer placed . If you to ask a question time , simply star would like .
Speaker #2: number Then the one on your telephone during that would like withdraw your please to star . Then number telephone two on your keypad .
Speaker #2: question , now I over to Ryan , Vice call Investor turn the Relations President of you may begin . Mr. conference
Ryan Taylor: Good morning, everyone. Thanks for joining us on the call. With me today are Jennifer Honeycutt, our President and Chief Executive Officer, and Sameer Ralhan, our Senior Vice President and Chief Financial Officer. Today's call is simultaneously being webcast. A replay of the webcast will be available on the investor section of our website later today under the heading Events and Presentations. A replay of this call will be available until 18 February. Yesterday, we issued our fourth quarter and full year 2025 earnings news release, earnings presentation, and supplemental materials, including information required by the SEC relating to adjusted or non-GAAP financial measures. In addition, we also issued our 2026 first quarter and full year guidance. These materials are available in the investor section of our website, veralto.com, under the heading Quarterly Earnings. Reconciliations of all non-GAAP measures are also provided in the appendix of the webcast slides.
Ryan Taylor: Good morning, everyone. Thanks for joining us on the call. With me today are Jennifer Honeycutt, our President and Chief Executive Officer, and Sameer Ralhan, our Senior Vice President and Chief Financial Officer. Today's call is simultaneously being webcast. A replay of the webcast will be available on the investor section of our website later today under the heading Events and Presentations. A replay of this call will be available until 18 February. Yesterday, we issued our fourth quarter and full year 2025 earnings news release, earnings presentation, and supplemental materials, including information required by the SEC relating to adjusted or non-GAAP financial measures. In addition, we also issued our 2026 first quarter and full year guidance. These materials are available in the investor section of our website, veralto.com, under the heading Quarterly Earnings. Reconciliations of all non-GAAP measures are also provided in the appendix of the webcast slides.
Speaker #3: Good morning on the
Speaker #3: are Jennifer Honeycutt , our president and Chief Executive Officer
Speaker #3: are Jennifer Honeycutt , our president and Chief Executive Officer . And senior Sameer Ralhan , vice President and
Speaker #3: . events and A heading replay of Presentations this under the until your website later Yesterday we issued quarter and full our fourth 2025 earnings release .
Speaker #3: presentation and supplemental be news required by SEC information relating to year adjusted the non-GAAP financial . addition , we also issued our 2026 quarter and full year guidance .
Speaker #3: first materials available in the replay our section of investor Veralto website , , under heading the Quarterly . non-GAAP all measures are also provided in the A webcast slides appendix of the .
Speaker #3: first materials available in the replay our section of investor Veralto website , , under heading the Quarterly . non-GAAP all measures are also provided in the A webcast slides appendix of the Earnings otherwise all noted , references to Unless variances are on over a year Reconciliations of year basis .
Ryan Taylor: Unless otherwise noted, all references to variances are on a year-over-year basis. During the call, we will make forward-looking statements within the meaning of the federal securities laws, including statements regarding events or developments that we believe or anticipate will or may occur in the future. These forward-looking statements are subject to a number of risks and uncertainties, including those set forth in our SEC filings. Actual results may differ materially from our forward-looking statements. These forward-looking statements speak only as of the date that they are being made, and we do not assume any obligation to update any forward-looking statements except as required by law. With that, I'll turn the call over to Jennifer.
Ryan Taylor: Unless otherwise noted, all references to variances are on a year-over-year basis. During the call, we will make forward-looking statements within the meaning of the federal securities laws, including statements regarding events or developments that we believe or anticipate will or may occur in the future. These forward-looking statements are subject to a number of risks and uncertainties, including those set forth in our SEC filings. Actual results may differ materially from our forward-looking statements. These forward-looking statements speak only as of the date that they are being made, and we do not assume any obligation to update any forward-looking statements except as required by law. With that, I'll turn the call over to Jennifer.
Speaker #3: During the will be including call , we forward looking statements meaning of the federal laws , within the statements regarding securities events or developments believe or are anticipate occur will in the future .
Speaker #3: or may These forward looking subject to a number of statements are and uncertainties , including those set forth in our SEC filings . differ results may forward looking materially from our .
Speaker #3: looking statements These statements forward speak are being made as of the we do assume any , and obligation to only forward looking statements as except not With that , I'll turn the call .
Jennifer L. Honeycutt: Thank you, Ryan, and thank you all for joining our call today. Our team finished 2025 with a strong fourth quarter capping off an outstanding year for Veralto. I want to recognize our 17,000 associates worldwide for their rigorous VES-driven execution that helped us serve customers, improve operating efficiency, and meet our financial commitments in 2025. Our success last year was underpinned by exceptional contributions and tireless efforts by our procurement, supply chain, and factory operations teams. During the year, we replicated and regionalized more than a dozen production lines into existing locations to drive flexibility across our footprint and improve our ability to serve customers more efficiently. These moves, in combination with targeted supply chain and strategic pricing actions, enabled us to successfully navigate last year's dynamic macro environment while providing strong support to our customers.
Jennifer Honeycutt: Thank you, Ryan, and thank you all for joining our call today. Our team finished 2025 with a strong fourth quarter capping off an outstanding year for Veralto. I want to recognize our 17,000 associates worldwide for their rigorous VES-driven execution that helped us serve customers, improve operating efficiency, and meet our financial commitments in 2025. Our success last year was underpinned by exceptional contributions and tireless efforts by our procurement, supply chain, and factory operations teams. During the year, we replicated and regionalized more than a dozen production lines into existing locations to drive flexibility across our footprint and improve our ability to serve customers more efficiently. These moves, in combination with targeted supply chain and strategic pricing actions, enabled us to successfully navigate last year's dynamic macro environment while providing strong support to our customers.
Speaker #3: over to Jennifer required law
Speaker #4: Thank you . Ryan , and thank you all for joining our today call . team finished Our 2025 with a strong fourth quarter , capping off an outstanding year for Veralto .
Speaker #4: I want recognize our 17,000 associates worldwide for their rigorous vs driven execution helped . That serve us improve operating efficiency meet our , and financial in 2025 .
Speaker #4: customers , Our success commitments year was underpinned by exceptional contributions and tireless efforts by our procurement , supply chain and factory operations teams .
Speaker #4: During Q4, we replicated and regionalized more than a dozen production lines into existing locations to drive flexibility in our footprint and improve our ability to serve customers more efficiently.
Speaker #4: These moves, in combination with targeted supply chain and pricing actions, enabled us to successfully navigate last year’s dynamic macro environment. While strong, providing support to our in.
Jennifer L. Honeycutt: In 2025, we delivered mid-single-digit core sales growth, double-digit adjusted earnings per share growth, and over $1 billion of free cash flow. As we closed out 2025, we established a $750 million share repurchase program and announced an 18% increase in our dividend. At the outset of 2026, we completed the acquisition of In-Situ, expanding our world-class water analytics portfolio into fast-growing environmental water and hydrology markets. Going forward, we remain excited about numerous opportunities to create value for shareholders through strategic growth and disciplined capital allocation. Entering 2026, we are confident that the enduring need to safeguard the global supply of clean water and safe food will continue to underpin steady demand for our products and services across our key industrial, municipal, and consumer packaged goods and markets.
Jennifer Honeycutt: In 2025, we delivered mid-single-digit core sales growth, double-digit adjusted earnings per share growth, and over $1 billion of free cash flow. As we closed out 2025, we established a $750 million share repurchase program and announced an 18% increase in our dividend. At the outset of 2026, we completed the acquisition of In-Situ, expanding our world-class water analytics portfolio into fast-growing environmental water and hydrology markets. Going forward, we remain excited about numerous opportunities to create value for shareholders through strategic growth and disciplined capital allocation. Entering 2026, we are confident that the enduring need to safeguard the global supply of clean water and safe food will continue to underpin steady demand for our products and services across our key industrial, municipal, and consumer packaged goods and markets.
Speaker #4: we 2025 , delivered digit sales core growth , double adjusted mid-single growth , over and $1 billion of free flow digit . As we closed out 2025 , we established a $750 million share repurchase program and announced an in our 18% increase dividend .
Speaker #4: And outset 2026 , of we completed the In-situ acquisition of , expanding our world class water portfolio analytics at the fast growing into , water and environmental markets .
Speaker #4: And outset 2026 , of we completed the In-situ acquisition of , expanding our world class water portfolio analytics at the fast growing into , water and environmental markets hydrology forward , we remain excited Going numerous opportunities to create value for shareholders through strategic and growth disciplined capital allocation .
Speaker #4: Entering 2026 , we are confident enduring that the need to safeguard the global supply of clean water and safe food will continue to underpin steady demand products and services across our key for our industrial , municipal and consumer packaged goods and markets .
Jennifer L. Honeycutt: Combined with our durable business model and rigorous deployment of VES, we expect to deliver yet another year of core sales growth and continued margin expansion with mid- to high-single-digit adjusted earnings per share growth. Now turning to our 2025 full-year financial results in detail. Total sales grew 6% year-over-year to $5.5 billion, an all-time high. We delivered 4.7% core sales growth, with both segments growing near the company average. Incremental margins were within our long-term framework at about 30% despite headwinds from tariffs and growth investments in TraceGains. Adjusted operating profit margin expanded by 20 basis points year-over-year. Adjusted earnings per share was $3.90, up 10% year-over-year, marking our second consecutive year of double-digit EPS growth. We generated over $1 billion of free cash flow, further strengthening our financial position.
Jennifer Honeycutt: Combined with our durable business model and rigorous deployment of VES, we expect to deliver yet another year of core sales growth and continued margin expansion with mid- to high-single-digit adjusted earnings per share growth. Now turning to our 2025 full-year financial results in detail. Total sales grew 6% year-over-year to $5.5 billion, an all-time high. We delivered 4.7% core sales growth, with both segments growing near the company average. Incremental margins were within our long-term framework at about 30% despite headwinds from tariffs and growth investments in TraceGains. Adjusted operating profit margin expanded by 20 basis points year-over-year. Adjusted earnings per share was $3.90, up 10% year-over-year, marking our second consecutive year of double-digit EPS growth. We generated over $1 billion of free cash flow, further strengthening our financial position.
Speaker #4: Combined with our business durable model rigorous and deployment of Viz , we expect to deliver yet another year of sales growth and continued margin expansion .
Speaker #4: mid to high single digit adjusted earnings per growth share . Now turning our 2025 full year to results in detail . Total sales grew 6% year over year to $5.5 billion , and all time high .
Speaker #4: We delivered growth with both segments growing near the company 4.7% core sales average incremental within our long term framework at about 30% . Despite margins were headwinds from and growth investments Tracegains in .
Speaker #4: Adjusted operating profit margin expanded by 20 basis points over year year and earnings per share was $3.90 , up year 10% year over our second consecutive year of double .
Speaker #4: digit EPs growth Marking . And we generated over $1 billion of free cash flow further strengthening our financial position . Overall , I'm very pleased with the gross margin expansion and robust free cash flow .
Jennifer L. Honeycutt: Overall, I'm very pleased with the growth margin expansion and robust free cash flow we delivered in 2025. Looking at core sales growth by geography and end market for the full year, growth throughout the enterprise was broad-based across key verticals and regions as our commercial teams executed well, leveraging our VES growth tools and strategic investments. In North America and Western Europe, which comprise about 70% of our total revenue, core sales grew 5.3% and 3.8% respectively in 2025. Core sales into high-growth markets grew 5.1% year over year. Taking a closer look, in North America, core sales growth exceeded 5% in both segments. In water quality, we continued to capitalize on broad-based demand for our chemical water treatment solutions, which delivered mid-single-digit core sales growth during 2025. From an industrial end market perspective, we saw the highest growth in chemical processing, power generation, mining, and data centers.
Jennifer Honeycutt: Overall, I'm very pleased with the growth margin expansion and robust free cash flow we delivered in 2025. Looking at core sales growth by geography and end market for the full year, growth throughout the enterprise was broad-based across key verticals and regions as our commercial teams executed well, leveraging our VES growth tools and strategic investments. In North America and Western Europe, which comprise about 70% of our total revenue, core sales grew 5.3% and 3.8% respectively in 2025. Core sales into high-growth markets grew 5.1% year over year. Taking a closer look, in North America, core sales growth exceeded 5% in both segments. In water quality, we continued to capitalize on broad-based demand for our chemical water treatment solutions, which delivered mid-single-digit core sales growth during 2025. From an industrial end market perspective, we saw the highest growth in chemical processing, power generation, mining, and data centers.
Speaker #4: We in delivered 2025 . Looking at sales growth core by geography and end market for the full year growth throughout the enterprise was based across key commercial our verticals and regions .
Speaker #4: executed well , As leveraging our VS growth tools broad , investments in North America and Western Europe , which comprise about 70% of our total revenue .
Speaker #4: Core sales grew and 3.8% , respectively , in and core sales 2025 , high growth markets into 5.3% 5.1% year over year grew closer look .
Speaker #4: , core America sales growth Taking a exceeded 5% in segments . In water quality , we continue to capitalize on broad demand for our based water treatment solutions , which delivered mid-single digit core sales growth during from an 2025 industrial end market perspective , we saw the highest growth in chemical processing power generation , mining data and centers .
Jennifer L. Honeycutt: Our growth in these verticals was a function of solid demand, strong commercial execution, and strategic new customer wins. North American sales of UV water treatment grew just under 10% last year, driven largely in support of our municipal customers' water reuse efforts. Both our water treatment and analytics businesses continue to benefit from increased industrial activity in North America. In PQI, core sales in North America grew 5.8% year-over-year in 2025, with mid-single-digit growth across both packaging and color and marking and coding. In marking and coding, core sales of consumables and equipment both grew mid-single digits year-over-year, with equipment sales growth from both our inkjet and laser product lines. This reflects a combination of steady end market demand, differentiated new product launches, and strategic market penetration across an ever-increasing number of substrates.
Jennifer Honeycutt: Our growth in these verticals was a function of solid demand, strong commercial execution, and strategic new customer wins. North American sales of UV water treatment grew just under 10% last year, driven largely in support of our municipal customers' water reuse efforts. Both our water treatment and analytics businesses continue to benefit from increased industrial activity in North America. In PQI, core sales in North America grew 5.8% year-over-year in 2025, with mid-single-digit growth across both packaging and color and marking and coding. In marking and coding, core sales of consumables and equipment both grew mid-single digits year-over-year, with equipment sales growth from both our inkjet and laser product lines. This reflects a combination of steady end market demand, differentiated new product launches, and strategic market penetration across an ever-increasing number of substrates.
Speaker #4: Our growth in these verticals was function of solid a demand , strong commercial execution and strategic new customer . North American UV sales of water wins treatment grew just 10% last year , driven largely in support of our municipal customers water reuse efforts .
Speaker #4: Both our water and treatment analytics businesses continue to benefit from increased industrial activity in North America . In Pcci , core sales in North America grew 5.8% year over year in 2025 , with mid-single growth digit across both packaging and color coding and marking and in marking and coding , core sales of consumables and equipment both grew mid-single digits year over year , with sales from equipment both our inkjet and laser product lines .
Speaker #4: This reflects combination of steady market end demand , differentiated new product launches , and strategic market penetration across an ever number of increasing substrates in Western Europe , core sales grew 3.8% year over year , with water quality up 4% and Pcci up 3.6% .
Jennifer L. Honeycutt: In Western Europe, core sales grew 3.8% year over year, with water quality up 4% and PQI up 3.6%. Core sales growth in water quality was led by our water analytics team in Europe and reflects traction from our growth initiatives as well as improvements made to our commercial architecture in 2024. These changes contributed to rigorous lead generation, funnel management, and VES-catalyzed commercial execution. Notably, water quality's growth in Western Europe last year was across both municipal and industrial customers. And in PQI, core sales growth in Western Europe was across both marking and coding and packaging and color. Growth in marking and coding was led by consumables and continuous inkjet printers. And in packaging and color, our core growth in Europe was highlighted by strategic growth within mid-tier consumer packaged goods customers.
Jennifer Honeycutt: In Western Europe, core sales grew 3.8% year over year, with water quality up 4% and PQI up 3.6%. Core sales growth in water quality was led by our water analytics team in Europe and reflects traction from our growth initiatives as well as improvements made to our commercial architecture in 2024. These changes contributed to rigorous lead generation, funnel management, and VES-catalyzed commercial execution. Notably, water quality's growth in Western Europe last year was across both municipal and industrial customers. And in PQI, core sales growth in Western Europe was across both marking and coding and packaging and color. Growth in marking and coding was led by consumables and continuous inkjet printers. And in packaging and color, our core growth in Europe was highlighted by strategic growth within mid-tier consumer packaged goods customers.
Speaker #4: Core sales growth in Water Quality was our Water Analytics team led by in Europe and reflects traction from our growth initiatives, as well as improvements made to commercial architecture.
Speaker #4: to our In 2024 . These changes contributed to rigorous lead generation , funnel management and VS catalyzed execution , notably , water quality , Western Europe year was last across both growth in municipal and customers and in industrial growth in Western sales Europe was across both marketing , core encoding and packaging , and color growth and marketing .
Speaker #4: Encoding was led by consumables and continuous inkjet printers , and in packaging and color growth . Our core in Europe was highlighted by strategic growth within mid-tier consumer packaged goods customers in high markets , core sales growth increased 5.1% year over year 2025 , led by Latin America in , India , and the Middle East .
Jennifer L. Honeycutt: In high-growth markets, core sales increased 5.1% year-over-year in 2025, led by Latin America, India, and the Middle East. In China, full year core sales grew modestly over the prior year, led by PQI. Overall, we delivered solid growth across all key regions while continuing to invest in our businesses for future value creation. Since the inception of Veralto, our core sales growth has accelerated approximately 200 basis points, and our adjusted operating margins have expanded by an average of 50 basis points per year. Over this two-year period, we have grown adjusted EPS by approximately 11% annually, with free cash flow conversion above 100%. This financial performance highlights our durable growth and capital-light business model fortified by the Veralto Enterprise System.
Jennifer Honeycutt: In high-growth markets, core sales increased 5.1% year-over-year in 2025, led by Latin America, India, and the Middle East. In China, full year core sales grew modestly over the prior year, led by PQI. Overall, we delivered solid growth across all key regions while continuing to invest in our businesses for future value creation. Since the inception of Veralto, our core sales growth has accelerated approximately 200 basis points, and our adjusted operating margins have expanded by an average of 50 basis points per year. Over this two-year period, we have grown adjusted EPS by approximately 11% annually, with free cash flow conversion above 100%. This financial performance highlights our durable growth and capital-light business model fortified by the Veralto Enterprise System.
Speaker #4: In China , full year core grew sales modestly over the prior year , led by . Overall , we delivered solid growth across all key regions while continuing to invest in our businesses for future value creation .
Speaker #4: Since the inception of Veralto, our core sales growth has accelerated approximately 200 basis points, and our adjusted operating margins have expanded by an average of 50 basis points per year.
Speaker #4: Over this two year period , we have grown adjusted EPs by approximately 11% annually , with free cash flow conversion above 100% . This financial highlights our performance durable growth and capital light business model , fortified by the Veralto enterprise system .
Jennifer L. Honeycutt: The acceleration in our core growth rate reflects strong commercial execution and traction from strategic initiatives, including targeted geographic growth, enhanced service offerings, and new product innovation. From a geographic perspective, we invested in people and resources to capitalize on secular growth drivers in Latin America, India, and the Middle East. Secular drivers in these markets, such as a growing middle class, increased scarcity of fresh water, rapid urbanization, and expanding industrialization, create a strong need for our products and services across both segments to test and treat water and ensure packaged foods are safe to consume. We see the investment in these markets across both the public and private sectors. In 2025, Latin America, India, and the Middle East were our three fastest-growing regions.
Jennifer Honeycutt: The acceleration in our core growth rate reflects strong commercial execution and traction from strategic initiatives, including targeted geographic growth, enhanced service offerings, and new product innovation. From a geographic perspective, we invested in people and resources to capitalize on secular growth drivers in Latin America, India, and the Middle East. Secular drivers in these markets, such as a growing middle class, increased scarcity of fresh water, rapid urbanization, and expanding industrialization, create a strong need for our products and services across both segments to test and treat water and ensure packaged foods are safe to consume. We see the investment in these markets across both the public and private sectors. In 2025, Latin America, India, and the Middle East were our three fastest-growing regions.
Speaker #4: The acceleration in our core rate reflects strong commercial growth execution and traction from strategic initiatives , including targeted geographic growth , enhanced service offerings and new product innovation .
Speaker #4: From a geographic perspective , we invested in people and resources to capitalize on secular growth drivers Latin in America , India , and the Middle East .
Speaker #4: Secular drivers in these markets , such as a growing middle class , increased scarcity of fresh water , rapid urbanization , and expanding industrialization , create a strong need for our products and services across both to test and treat segments water and ensure packaged foods are safe to consume .
Speaker #4: We see the investment in these markets across both the public and private sectors . In 2025 , Latin America , India and the Middle East were our three fastest growing regions and as it relates to enhancing our service offerings , we focused on expanding support across our global installed base , increasing the attachment rate of service contracts on new equipment sales , and expanding our consulting services to project new design , particularly with respect to treatment systems .
Jennifer L. Honeycutt: As it relates to enhancing our service offerings, we focused on expanding support across our global installed base, increasing the attachment rate of service contracts on new equipment sales, and expanding our consulting services to new project design, particularly with respect to water treatment systems for data centers. This focus drove strong service growth across both segments in 2025. As it relates to innovation, our increased investment in R&D, combined with a focus on new product opportunities that have the highest growth and most attractive returns, have reinvigorated our innovation flywheel. Combined with our extensive direct-to-customer business model, these efforts have accelerated our development of fit-for-purpose solutions to enhance product quality, resolve critical pain points, and drive greater efficiency throughout customer operations. Over the past 12 to 18 months, we have begun to see the fruits of our R&D efforts across Veralto with several new product launches.
Jennifer Honeycutt: As it relates to enhancing our service offerings, we focused on expanding support across our global installed base, increasing the attachment rate of service contracts on new equipment sales, and expanding our consulting services to new project design, particularly with respect to water treatment systems for data centers. This focus drove strong service growth across both segments in 2025. As it relates to innovation, our increased investment in R&D, combined with a focus on new product opportunities that have the highest growth and most attractive returns, have reinvigorated our innovation flywheel. Combined with our extensive direct-to-customer business model, these efforts have accelerated our development of fit-for-purpose solutions to enhance product quality, resolve critical pain points, and drive greater efficiency throughout customer operations. Over the past 12 to 18 months, we have begun to see the fruits of our R&D efforts across Veralto with several new product launches.
Speaker #4: For data centers . This focus drove strong service growth across segments . both In 2025 , as it relates to innovation , our increased investment in R&D , combined with a focus on new product opportunities that have the growth and most highest returns , attractive have reinvigorated our innovation .
Speaker #4: Flywheel , combined with our extensive direct to customer business model , these efforts have accelerated our development of fit for purpose solutions to enhance product quality , resolve critical pain points , and greater drive efficiency throughout customer operations .
Speaker #4: Over the past months , we 12 to 18 have begun to see the our fruits of R&D efforts across Veralto with several new product launches , a few notable new contributed to that products growth in 2025 include a new ammonia analyzer water quality launched in that simplifies operations , improves efficiency , and reduces maintenance for customers .
Jennifer L. Honeycutt: A few notable new products that contributed to growth in 2025 include a new ammonia analyzer launched in water quality that simplifies operations, improves efficiency, and reduces maintenance for customers. This product is used at various stages of the water cycle to monitor ammonia levels, maintain water quality, and protect the health of aquatic environments. Additionally, we continued to expand the number of parameters customers can test using our most advanced and easiest-to-use testing technology, our single-use Chemkeys, which grew double digits year-over-year in 2025. In our PQI segment, our new UV laser marking and coding system met strong customer demand in 2025. This new technology is helping customers transition to more sustainable, flexible film packaging solutions. In our packaging and color software offering, we launched a new AI-enabled solution to help streamline and error-proof packaging print during the design phase.
Jennifer Honeycutt: A few notable new products that contributed to growth in 2025 include a new ammonia analyzer launched in water quality that simplifies operations, improves efficiency, and reduces maintenance for customers. This product is used at various stages of the water cycle to monitor ammonia levels, maintain water quality, and protect the health of aquatic environments. Additionally, we continued to expand the number of parameters customers can test using our most advanced and easiest-to-use testing technology, our single-use Chemkeys, which grew double digits year-over-year in 2025. In our PQI segment, our new UV laser marking and coding system met strong customer demand in 2025. This new technology is helping customers transition to more sustainable, flexible film packaging solutions. In our packaging and color software offering, we launched a new AI-enabled solution to help streamline and error-proof packaging print during the design phase.
Speaker #4: This product is used at various stages of the water to monitor cycle ammonia levels , maintain water quality , and protect the health of aquatic environments .
Speaker #4: Additionally , we continue to expand the number of parameters customers can test using our most advanced and easiest to use testing technology . Our single use chem keys , which grew double digits year over year in 2025 .
Speaker #4: In our Pcci segment , our new UV laser marking and coding system met strong customer demand in 2025 . This new technology is helping customers transition to more sustainable , flexible film packaging solutions .
Speaker #4: in our packaging color And and software offering , we launched a new AI enabled solution to help streamline and error proof packaging , print .
Jennifer L. Honeycutt: This helps brands accelerate go-to-market and reduce costly reprints and product recalls. Looking at 2026, we believe that the durability of the secular drivers across our key end markets will continue to underpin steady demand for our products and services. About 80% of our sales are tied to water, food, and essential goods, and about 60% of our revenue is recurring. Of our recurring revenue, the majority is comprised of consumables that are critical to the daily operations of our customers where the cost of failure is high. In addition, our large global installed base of instrumentation and equipment drives a recurring need for replacement and upgrades each year, further fortifying our sales durability.
Jennifer Honeycutt: This helps brands accelerate go-to-market and reduce costly reprints and product recalls. Looking at 2026, we believe that the durability of the secular drivers across our key end markets will continue to underpin steady demand for our products and services. About 80% of our sales are tied to water, food, and essential goods, and about 60% of our revenue is recurring. Of our recurring revenue, the majority is comprised of consumables that are critical to the daily operations of our customers where the cost of failure is high. In addition, our large global installed base of instrumentation and equipment drives a recurring need for replacement and upgrades each year, further fortifying our sales durability.
Speaker #4: During the design phase . This helps brands accelerate , go to market and reduce costly reprints and product recalls . Looking at 2026 , we believe that the durability of the secular drivers across our key end markets will continue to underpin steady for our demand products and services .
Speaker #4: About 80% of our sales are tied to water , food and essential goods , and about 60% of our is recurring of our recurring revenue .
Speaker #4: The majority is comprised of consumables that are critical to the daily operations of our customers , where the cost of failure is high .
Speaker #4: In addition , our large global installed base of instrumentation and equipment drives a reoccurring need for replacement and upgrades each year . Further fortifying our sales , durability .
Jennifer L. Honeycutt: Given these attributes and continued focus on our strategic growth initiatives, we guided to another year of steady core sales growth in 2026 and our third consecutive year of adjusted operating margin expansion with adjusted EPS growth in the mid to high single digits. In conjunction with reigniting our innovation engine, we are improving the quality of our portfolio with a focus on accelerating our core sales growth rate and creating long-term value. At the outset of 2025, we divested AVT, a slower-growth instrumentation product line within PQI. Meanwhile, our acquisition of TraceGains grew sales by more than 20% in our first full year of ownership. The combination of Esko and TraceGains is helping our CPG customers accelerate time to market for new products and connect digital workflows to drive efficiency. In our water quality segment, we acquired Aquafides in the Q2 of last year.
Jennifer Honeycutt: Given these attributes and continued focus on our strategic growth initiatives, we guided to another year of steady core sales growth in 2026 and our third consecutive year of adjusted operating margin expansion with adjusted EPS growth in the mid to high single digits. In conjunction with reigniting our innovation engine, we are improving the quality of our portfolio with a focus on accelerating our core sales growth rate and creating long-term value. At the outset of 2025, we divested AVT, a slower-growth instrumentation product line within PQI. Meanwhile, our acquisition of TraceGains grew sales by more than 20% in our first full year of ownership. The combination of Esko and TraceGains is helping our CPG customers accelerate time to market for new products and connect digital workflows to drive efficiency. In our water quality segment, we acquired Aquafides in the Q2 of last year.
Speaker #4: Given these attributes and continued focus on our strategic growth initiatives , we guided to another year of steady core sales growth in 2026 and our third consecutive year of adjusted operating margin expansion with adjusted EPs growth in the mid to high single digits .
Speaker #4: In conjunction with reigniting our innovation engine, we are improving the quality of our portfolio with a focus on accelerating our core sales growth rate and creating long-term value.
Speaker #4: At the outset of 2025 , we divested AV , a slower growth instrumentation product line with PKI . Meanwhile , our acquisition of Tracegains grew sales more than 20% in our ownership .
Speaker #4: The combination of ESCO and Tracegains is helping our CPG customers accelerate time to market for new and products connect digital workflows to drive efficiency in our water quality segment , we acquired Aqua Fetus in the second quarter of last year .
Jennifer L. Honeycutt: Aquafides complements our TrojanUV business by providing low-flow UV water treatment solutions through an expanded footprint in Europe. Just a few weeks ago, we completed the acquisition of In-Situ, expanding our world-class water analytics portfolio into fast-growing environmental water and hydrology markets. Based in Colorado, In-Situ is a global leader in water measurement and monitoring, offering easy-to-use sensors, sondes, and data management solutions. Its differentiated technologies strengthen our position across the environmental water ecosystem and complement our OTT HydroMet portfolio. Over the past 3 years, In-Situ has averaged roughly 8% core sales growth, and in 2025, In-Situ delivered approximately $80 million in sales, with gross margins around 50% and EBITDA margins in the mid-teens. The addition of In-Situ expands our presence in fast-growing environmental water and hydrology markets and enhances our ability to help address freshwater challenges related to increasing water scarcity, severe weather events, and water contamination.
Jennifer Honeycutt: Aquafides complements our TrojanUV business by providing low-flow UV water treatment solutions through an expanded footprint in Europe. Just a few weeks ago, we completed the acquisition of In-Situ, expanding our world-class water analytics portfolio into fast-growing environmental water and hydrology markets. Based in Colorado, In-Situ is a global leader in water measurement and monitoring, offering easy-to-use sensors, sondes, and data management solutions. Its differentiated technologies strengthen our position across the environmental water ecosystem and complement our OTT HydroMet portfolio. Over the past 3 years, In-Situ has averaged roughly 8% core sales growth, and in 2025, In-Situ delivered approximately $80 million in sales, with gross margins around 50% and EBITDA margins in the mid-teens. The addition of In-Situ expands our presence in fast-growing environmental water and hydrology markets and enhances our ability to help address freshwater challenges related to increasing water scarcity, severe weather events, and water contamination.
Speaker #4: Aqua fetus complements our Trojan UV business by providing low flow UV water treatment solutions through an expanded footprint in Europe and just a few weeks ago , we completed the acquisition of Insitu , expanding our world class water analytics portfolio into fast growing environmental , water and hydrology markets .
Speaker #4: Based in Colorado . Insitu is a global leader in water measurement and monitoring , offering easy to sensors use , songs , and data solutions .
Speaker #4: It's differentiated technologies strengthen our position across the environmental , water ecosystem and complements our OT Hydromet portfolio . Over the past three years , Insitu has averaged roughly 8% core sales growth , and in 2025 , Insitu delivered approximately $80 million in sales with gross margins around 50% and EBITDA margins in the mid-teens .
Speaker #4: The addition of in-situ expands our presence in fast growing environmental , water and hydrology markets and enhances our ability to help address freshwater challenges related to water increasing severe weather events , and water contamination .
Jennifer L. Honeycutt: Greater visibility to the quantity and the quality of surface and groundwater enables municipalities, government agencies, and industries to mitigate economic risk and ensure public safety. These customers are increasingly faced with a variety of issues, including not enough water, too much water, water in the wrong places, and changing water composition, which requires different treatment solutions. The combination of In-Situ and OTT products, along with support from our broader water analytics capabilities, creates a significant opportunity to help customers efficiently monitor and analyze the quantity and quality of their freshwater sources. We now have a premier environmental water analytics portfolio with significant opportunities to accelerate growth through complementary channels, improve efficiency across our global footprint, and deliver greater value for customers and shareholders.
Jennifer Honeycutt: Greater visibility to the quantity and the quality of surface and groundwater enables municipalities, government agencies, and industries to mitigate economic risk and ensure public safety. These customers are increasingly faced with a variety of issues, including not enough water, too much water, water in the wrong places, and changing water composition, which requires different treatment solutions. The combination of In-Situ and OTT products, along with support from our broader water analytics capabilities, creates a significant opportunity to help customers efficiently monitor and analyze the quantity and quality of their freshwater sources. We now have a premier environmental water analytics portfolio with significant opportunities to accelerate growth through complementary channels, improve efficiency across our global footprint, and deliver greater value for customers and shareholders.
Speaker #4: Greater visibility to the quantity and the quality of surface and groundwater enables municipalities , government agencies , and industries to mitigate economic risk and ensure public safety .
Speaker #4: customers are These increasingly faced with a variety of issues , including not water enough , too much water , water in the wrong places , and changing water composition , which different requires treatment solutions .
Speaker #4: The combination of in-situ and OT products, along with support from our Water Analytics broader capabilities, creates a significant opportunity to help customers efficiently monitor and analyze the quantity and quality of their fresh sources.
Speaker #4: We now have a Premier environmental water analytics portfolio with significant opportunities to accelerate growth through complementary channels . Improve efficiency across our global footprint , and deliver greater value for customers and shareholders .
Jennifer L. Honeycutt: This addition to our portfolio is squarely aligned to our purpose of safeguarding the world's most vital resources, and we are excited to publicly welcome the In-Situ team to Veralto. Going forward, we remain excited about numerous opportunities to create value for shareholders through strategic growth and disciplined capital allocation. Our pipeline of acquisition opportunities remains strong for both water quality and PQI. That concludes my opening remarks, and at this time, I'll turn the call over to Sameer to provide details on our Q4 results and 2026 guidance.
Jennifer Honeycutt: This addition to our portfolio is squarely aligned to our purpose of safeguarding the world's most vital resources, and we are excited to publicly welcome the In-Situ team to Veralto. Going forward, we remain excited about numerous opportunities to create value for shareholders through strategic growth and disciplined capital allocation. Our pipeline of acquisition opportunities remains strong for both water quality and PQI. That concludes my opening remarks, and at this time, I'll turn the call over to Sameer to provide details on our Q4 results and 2026 guidance.
Speaker #4: In addition to this, our portfolio is squarely aligned to the purpose most vital to our world: safeguarding resources, and we are excited to publicly welcome the in-situ team to Veralto.
Speaker #4: Going forward , we remain excited about numerous opportunities to create value for shareholders through strategic growth and disciplined capital allocation . Our pipeline of acquisition opportunities remains strong for both water quality and PKI that concludes my opening remarks .
Speaker #4: And at this time, I'll turn the call over to Sameer to provide details on our fourth quarter results and 2026 guidance.
Ryan Taylor: Thanks, Jennifer, and good morning, everyone. I'll begin with our consolidated results for the fourth quarter. Total sales grew 3.8% on a year-over-year basis to nearly $1.4 billion. Currency was a 250 basis point tailwind year-over-year, and divestitures, net of acquisitions, reduced sales by 30 basis points, primarily reflecting the AVT divestiture. Core sales grew 1.6%. Our core sales growth was primarily driven by price, which increased 2.3% year-over-year. Volumes were down modestly, a function of three fewer shipping days in the fourth quarter of 2025 versus the prior year. This impact was approximately 260 basis points. Underlying demand remained steady in both the segments. Recurring revenue grew mid-single digits year-over-year and comprised 59% of our total sales. Gross profit increased 3.4% year-over-year to $828 million. Gross profit margin was 59.3%.
Sameer Ralhan: Thanks, Jennifer, and good morning, everyone. I'll begin with our consolidated results for the fourth quarter. Total sales grew 3.8% on a year-over-year basis to nearly $1.4 billion. Currency was a 250 basis point tailwind year-over-year, and divestitures, net of acquisitions, reduced sales by 30 basis points, primarily reflecting the AVT divestiture. Core sales grew 1.6%. Our core sales growth was primarily driven by price, which increased 2.3% year-over-year. Volumes were down modestly, a function of three fewer shipping days in the fourth quarter of 2025 versus the prior year. This impact was approximately 260 basis points. Underlying demand remained steady in both the segments. Recurring revenue grew mid-single digits year-over-year and comprised 59% of our total sales. Gross profit increased 3.4% year-over-year to $828 million. Gross profit margin was 59.3%.
Speaker #5: Jennifer , Thanks , and good morning , everyone . I'll begin with our consolidated results for the fourth quarter . Total sales grew 3.8% on a year over year basis to nearly $1.4 billion .
Speaker #5: Currency was a 250 basis point tailwind year over year , and divestitures , net of reduced sales by 30 basis points , primarily reflecting the AVT divestiture .
Speaker #5: Core sales grew 1.6% . Our core sales growth was primarily driven by price , which increased 2.3% year over year . Volumes were down modestly , a function of three fewer shipping days in the fourth quarter of 2025 versus the prior year impact was .
Speaker #5: This is approximately 260 basis points. Underlying demand remained steady in both segments. Recurring revenue grew mid-single digits year over year and comprised 59% of our total sales.
Speaker #5: Gross profit increased 3.4% year over year to $828 million . Gross profit margin was 59.3% . Adjusted operating profit increased 7% year over year .
Ryan Taylor: Adjusted operating profit increased 7% year-over-year, and adjusted operating profit margin improved by 80 basis points to 24.6%. The increase in Q4 profitability was across both our segments, driven by strong operating execution. Looking at EPS for Q4, adjusted earnings per share grew 9% year-over-year to $1.04 per share. In the fourth quarter, we generated free cash flow of $291 million, or 115% conversion of adjusted net income. I'll cover the segment results now, starting with water quality. Our water quality segment delivered $846 million in total sales, up 4.3% on a year-over-year basis. Currency was a 240 basis points tailwind. The acquisition of Aquafides contributed 50 basis points of growth. Core sales grew 1.4% year-over-year, led by price, which increased 1.8%. Volumes decreased modestly due to three fewer shipping days.
Sameer Ralhan: Adjusted operating profit increased 7% year-over-year, and adjusted operating profit margin improved by 80 basis points to 24.6%. The increase in Q4 profitability was across both our segments, driven by strong operating execution. Looking at EPS for Q4, adjusted earnings per share grew 9% year-over-year to $1.04 per share. In the fourth quarter, we generated free cash flow of $291 million, or 115% conversion of adjusted net income. I'll cover the segment results now, starting with water quality. Our water quality segment delivered $846 million in total sales, up 4.3% on a year-over-year basis. Currency was a 240 basis points tailwind. The acquisition of Aquafides contributed 50 basis points of growth. Core sales grew 1.4% year-over-year, led by price, which increased 1.8%. Volumes decreased modestly due to three fewer shipping days.
Speaker #5: And adjusted operating profit margin improved by 80 basis points to 24.6% . increase The in Q4 was across profitability both our segment's , driven by strong operating execution .
Speaker #5: Looking at EPs for Q4 adjusted earnings per share grew 9% year over year to one dollars and $0.04 per share in the fourth quarter .
Speaker #5: We generated free cash flow of $291 million, or 115% conversion of GAAP net income. I'll cover the segment results now, starting with Water Quality.
Speaker #5: Our water quality segment delivered $846 million in total sales , up 4.3% on a year over year basis . Currency was a 240 basis points tailwind .
Speaker #5: The acquisition of Aquafeeds contributed 50 basis points of growth . Core sales grew 1.4% year over price , year , led which by increased 1.8% .
Ryan Taylor: Underlying demand for our water analytics and water treatment solutions remained steady year-over-year. Adjusted operating profit increased 5.8% year-over-year to $219 million, and adjusted operating profit margin was 25.9%, up 40 basis points year-over-year. Looking at the full year, our water quality team delivered core sales growth of 4.7%, driven largely by volume. Core sales growth was equally driven by recurring revenue and instrumentation. Adjusted operating profit grew 9.4%, or $74 million, to $858 million. This resulted in 80 basis points of margin improvement. Overall, our water quality team executed well in 2025 and delivered outstanding financial performance, setting all-time highs in annual sales and adjusted operating profit. Moving to the next page, total sales in our PQI segment grew 3% year-over-year to $550 million in the fourth quarter. Currency was a 280 basis point tailwind.
Sameer Ralhan: Underlying demand for our water analytics and water treatment solutions remained steady year-over-year. Adjusted operating profit increased 5.8% year-over-year to $219 million, and adjusted operating profit margin was 25.9%, up 40 basis points year-over-year. Looking at the full year, our water quality team delivered core sales growth of 4.7%, driven largely by volume. Core sales growth was equally driven by recurring revenue and instrumentation. Adjusted operating profit grew 9.4%, or $74 million, to $858 million. This resulted in 80 basis points of margin improvement. Overall, our water quality team executed well in 2025 and delivered outstanding financial performance, setting all-time highs in annual sales and adjusted operating profit. Moving to the next page, total sales in our PQI segment grew 3% year-over-year to $550 million in the fourth quarter. Currency was a 280 basis point tailwind.
Speaker #5: decreased Volumes modestly due to three fewer shipping days . Underlying demand for our water analytics and water treatment solutions remained steady year over year .
Speaker #5: Adjusted operating profit increased 5.8% year over year to $219 million , and adjusted operating profit margin was 25.9% , up 40 basis points year over year .
Speaker #5: at the full Looking year , our water quality team delivered core sales growth of 4.7% , driven largely by volume . Core sales growth was equally driven by recurring revenue and instrumentation .
Speaker #5: Adjusted operating profit grew 9.4% , or $74 million , to $858 million . This resulted in 80 basis of margin points improvement . Overall , our water quality team executed well in 2025 and delivered outstanding financial performance , setting all time annual sales and adjusted highs in operating profit .
Speaker #5: Moving to the next page, sales in total for our segment grew 3% year over year to $550 million in the fourth quarter. Currency was a 280 basis point tailwind.
Ryan Taylor: Net divestitures reduced sales by 1.6% year over year. This was primarily due to the AVT divestiture, partially offset by a couple of small technology acquisitions. Core sales grew 1.8%, with price up 3%. Volume was down 1.2%, primarily due to the three fewer shipping days, which had an impact of approximately 260 basis points volumes on a year-over-year basis. Underlying demand for our PQI products and services remained steady. PQI's adjusted operating profit was $146 million in the fourth quarter, up $13 million over the prior year period, resulting in an adjusted operating profit margin of 26.5%. This represents a 160 basis points improvement over the prior year period. For the full year, PQI delivered 4.8% core sales growth and adjusted operating profit margin of 26.5%. The full-year margin reflects investments in TraceGains to drive continued strong double-digit growth, as well as investments made to diversify our regional production.
Sameer Ralhan: Net divestitures reduced sales by 1.6% year over year. This was primarily due to the AVT divestiture, partially offset by a couple of small technology acquisitions. Core sales grew 1.8%, with price up 3%. Volume was down 1.2%, primarily due to the three fewer shipping days, which had an impact of approximately 260 basis points volumes on a year-over-year basis. Underlying demand for our PQI products and services remained steady. PQI's adjusted operating profit was $146 million in the fourth quarter, up $13 million over the prior year period, resulting in an adjusted operating profit margin of 26.5%. This represents a 160 basis points improvement over the prior year period. For the full year, PQI delivered 4.8% core sales growth and adjusted operating profit margin of 26.5%. The full-year margin reflects investments in TraceGains to drive continued strong double-digit growth, as well as investments made to diversify our regional production.
Speaker #5: Net divestitures reduced sales by 1.6% year over year. This was primarily due to the divestiture, partially offset by a couple of small technology acquisitions.
Speaker #5: Core sales grew with 1.8% , price up 3% . Volume was down 1.2% , primarily due to the three fewer shipping days , which had an impact of approximately 260 basis points to volumes on a year over year basis .
Speaker #5: Underlying demand for our services products and remained steady . Pci's adjusted operating profit was $146 million in the fourth quarter , up $13 million over the prior year period , resulting in adjusted operating margin profit of 26.5% .
Speaker #5: This represents a 160 basis point improvement over the prior year period . For the full year , Pcci delivered 4.8% core sales growth and adjusted operating profit margin of 26.5% .
Speaker #5: The full year margin reflects investments in Tracegains to drive continued strong double digit growth , as well as investments made to diversify our regional production .
Ryan Taylor: Overall, it was a very strong year for our PQI team. They delivered all-time highs with nearly $2.2 billion in sales and an adjusted operating profit of $578 million. Turning now to our balance sheet and cash flow. In Q4, we generated $311 million of cash from operations. We invested $20 million in capital expenditures. Free cash flow was $291 million in the quarter, or 115% conversion of adjusted net income. At the end of the fourth quarter, gross debt was $2.7 billion, and cash on hand was $2 billion. Net debt was $642 million, resulting in net leverage of 0.5 times. As Jennifer shared, early in the first quarter of 2026, we completed the acquisition of In-Situ. The deal was funded with cash on hand. The cash outflow in Q1 for this acquisition was $427 million, net of cash acquired.
Sameer Ralhan: Overall, it was a very strong year for our PQI team. They delivered all-time highs with nearly $2.2 billion in sales and an adjusted operating profit of $578 million. Turning now to our balance sheet and cash flow. In Q4, we generated $311 million of cash from operations. We invested $20 million in capital expenditures. Free cash flow was $291 million in the quarter, or 115% conversion of adjusted net income. At the end of the fourth quarter, gross debt was $2.7 billion, and cash on hand was $2 billion. Net debt was $642 million, resulting in net leverage of 0.5 times. As Jennifer shared, early in the first quarter of 2026, we completed the acquisition of In-Situ. The deal was funded with cash on hand. The cash outflow in Q1 for this acquisition was $427 million, net of cash acquired.
Speaker #5: Overall , it was a very strong year for our Pcci team . They delivered all time highs with nearly sales $2.2 billion in and adjusted operating profit of $578 million .
Speaker #5: Turning now to our balance sheet and cash flow. In Q4, we generated $311 million of cash from operations. We invested $20 million in capital expenditures.
Speaker #5: Free cash flow was $291 million in the quarter . Our 115% of GAAP net conversion income . At the end of the fourth quarter , gross debt was $2.7 billion and cash on hand was $2 billion .
Speaker #5: Net debt was $642 million, resulting in net leverage of 0.5 times. As Jennifer shared earlier, in the first quarter of 2026, we completed the acquisition of Insitu.
Speaker #5: The deal was funded with cash on hand. The cash outflow in Q1 for this acquisition was $427 million, net of cash acquired, even after.
Ryan Taylor: Even after this acquisition, we continue to have flexibility in how we deploy capital. To that point, in Q4, our board of directors approved an 18% increase in our quarterly dividend and authorized a $750 million share repurchase program. We have an attractive pipeline of opportunities in both water quality and PQI. We will remain disciplined in our approach as we continue to deploy capital to create long-term shareholder value. Over the long term, our bias remains to create long-term shareholder value through M&A. Turning now to our guidance for 2026, beginning with our expectations for the full year. We are targeting core sales growth in the low to mid-single digit range on a year-over-year basis. Total sales growth, including the impact of completed acquisitions, and FX, is projected in the mid to high single digit range.
Sameer Ralhan: Even after this acquisition, we continue to have flexibility in how we deploy capital. To that point, in Q4, our board of directors approved an 18% increase in our quarterly dividend and authorized a $750 million share repurchase program. We have an attractive pipeline of opportunities in both water quality and PQI. We will remain disciplined in our approach as we continue to deploy capital to create long-term shareholder value. Over the long term, our bias remains to create long-term shareholder value through M&A. Turning now to our guidance for 2026, beginning with our expectations for the full year. We are targeting core sales growth in the low to mid-single digit range on a year-over-year basis. Total sales growth, including the impact of completed acquisitions, and FX, is projected in the mid to high single digit range.
Speaker #5: this acquisition , we continue to have flexibility in how we deploy to that point in the our board of directors approved an 18% increase in our quarterly dividend and authorized a $750 million share repurchase program .
Speaker #5: We have an attractive pipeline of opportunities water in both and PKI . We will remain disciplined in our approach as we continue to deploy capital to long term create shareholder value over the long term , remains our bias create to long term shareholder through value M&A .
Speaker #5: Turning now to our guidance for 2026 , beginning with our expectations for the full year , we targeting core sales growth are in the low to mid single digit year range on a year over basis sales growth , including the impact of .
Ryan Taylor: We are modeling a currency tailwind of 100 to 150 basis points. This assumes that FX rates, as of 31 December, prevail throughout the year. Acquisitions net of divestitures are expected to contribute 150 basis points of growth, primarily from the In-Situ acquisition. Moving to adjusted operating profit margin, we are targeting approximately 25 basis points of year-over-year improvement in 2026. This assumes 50 basis points of margin expansion in our core business, offset by about 25 basis points of dilution from the In-Situ acquisition. Our adjusted EPS guidance for the full year 2026 is in the range of $4.10 per share to $4.20 per share, or mid to high single digit growth over the prior year. We are targeting free cash flow conversion of approximately 100% of adjusted net income.
Sameer Ralhan: We are modeling a currency tailwind of 100 to 150 basis points. This assumes that FX rates, as of 31 December, prevail throughout the year. Acquisitions net of divestitures are expected to contribute 150 basis points of growth, primarily from the In-Situ acquisition. Moving to adjusted operating profit margin, we are targeting approximately 25 basis points of year-over-year improvement in 2026. This assumes 50 basis points of margin expansion in our core business, offset by about 25 basis points of dilution from the In-Situ acquisition. Our adjusted EPS guidance for the full year 2026 is in the range of $4.10 per share to $4.20 per share, or mid to high single digit growth over the prior year. We are targeting free cash flow conversion of approximately 100% of adjusted net income.
Speaker #5: completed acquisitions and Total FX is projected in the mid to high single digit range . We are modeling a tailwind currency of 100 to 150 basis points assumes .
Speaker #5: that FX This rates as of December 31st throughout the year prevail . Acquisitions , net of divestitures , expected to are contribute 150 basis points growth of , primarily from in-situ the acquisition moving to adjusted operating profit margin .
Speaker #5: targeting We are approximately 25 basis points of year improvement year over in 2026 . This assumes 50 basis points of margin expansion in our core business , offset by about 25 basis points of dilution from the in-situ acquisition .
Speaker #5: Our adjusted EPs guidance for the full year 2026 is in the range of $4.10 per share to $4.20 per share , or mid to high single digit growth over the prior year .
Ryan Taylor: This assumes CapEx in the range of 1 to 1.5% of sales and a modest working capital investment to support our growth. Looking now at Q1, on a year-over-year basis, we are targeting core sales growth in the range of flat to upper low single digits, and total sales growth, including the impact of completed acquisitions and FX, in the range of mid to high single digits. Currency translation is expected to be a year-over-year tailwind of approximately 3.5%, and acquisitions net of divestitures are expected to drive about 50 basis points of sales growth. As a reminder, our core sales growth in Q1 2025 was 7.8%, setting up a tough comparison for this year. Our Q1 2026 guidance implies a two-year stack of about 4 to 5% core sales growth.
Sameer Ralhan: This assumes CapEx in the range of 1 to 1.5% of sales and a modest working capital investment to support our growth. Looking now at Q1, on a year-over-year basis, we are targeting core sales growth in the range of flat to upper low single digits, and total sales growth, including the impact of completed acquisitions and FX, in the range of mid to high single digits. Currency translation is expected to be a year-over-year tailwind of approximately 3.5%, and acquisitions net of divestitures are expected to drive about 50 basis points of sales growth. As a reminder, our core sales growth in Q1 2025 was 7.8%, setting up a tough comparison for this year. Our Q1 2026 guidance implies a two-year stack of about 4 to 5% core sales growth.
Speaker #5: We are targeting free cash flow conversion of approximately 100% of GAAP net income . This assumes CapEx in the range of 1 to 1.5% of sales , and a modest working capital investment to support our growth .
Speaker #5: Looking now at Q1 , on a year over year basis , we are targeting core sales growth in the range of flat to up single low digits and total sales growth , excluding the impact of completed and FX acquisitions in the range of single mid to high digits , currency translation is expected to be a year over year tailwind of approximately 3.5% .
Speaker #5: And acquisitions , net of divestitures , are expected to drive about points of sales 50 basis growth . As a reminder , sales growth in our core Q1 2025 was 7.8% , setting up a tough comparison for this year .
Speaker #5: Our Q1 2026 guidance implies a two year stack of about 4 to 5% core sales growth . We are adjusted operating targeting profit margin of approximately 24.5% , and EPs in the range of adjusted $0.97 per share to $1 and one cents per share .
Ryan Taylor: We are targeting adjusted operating profit margin of approximately 24.5%, and adjusted EPS in the range of $0.97 per share to $1.01 per share. Additional details on the modeling assumptions supporting our full year and Q1 guidance are in the appendix of our earnings presentation. That concludes my prepared remarks. At this point, I'll turn the call back over to Jennifer.
Sameer Ralhan: We are targeting adjusted operating profit margin of approximately 24.5%, and adjusted EPS in the range of $0.97 per share to $1.01 per share. Additional details on the modeling assumptions supporting our full year and Q1 guidance are in the appendix of our earnings presentation. That concludes my prepared remarks. At this point, I'll turn the call back over to Jennifer.
Speaker #5: Additional details on the modeling assumptions supporting our full year and Q1 guidance are in the our earnings appendix of presentation . That concludes my prepared remarks .
Jennifer L. Honeycutt: Thanks, Sameer. In summary, we capped off an outstanding 2025 with a strong Q4. Given the essential need for our technology solutions, durable business model, and strong secular growth drivers across our end markets, we expect another year of steady core sales growth in 2026. We will continue to leverage the power of the Veralto Enterprise System to drive continuous improvement in support of our customers. Our financial position remains strong, and we will continue to evaluate strategic opportunities within our disciplined capital allocation framework. We are proud of the progress we've made on our journey as a young public company, and we are excited about the opportunities in front of us as we continue to build Veralto and help customers solve some of the world's biggest challenges in delivering clean water, safe food, and trusted essential goods.
Jennifer Honeycutt: Thanks, Sameer. In summary, we capped off an outstanding 2025 with a strong Q4. Given the essential need for our technology solutions, durable business model, and strong secular growth drivers across our end markets, we expect another year of steady core sales growth in 2026. We will continue to leverage the power of the Veralto Enterprise System to drive continuous improvement in support of our customers. Our financial position remains strong, and we will continue to evaluate strategic opportunities within our disciplined capital allocation framework. We are proud of the progress we've made on our journey as a young public company, and we are excited about the opportunities in front of us as we continue to build Veralto and help customers solve some of the world's biggest challenges in delivering clean water, safe food, and trusted essential goods.
Speaker #5: this point , I'll At turn the call back over to Jennifer .
Speaker #4: Thanks , Samir . In summary , we off an capped outstanding 2025 with a strong fourth quarter . Given the essential need for a technology solutions durable business and model strong secular growth drivers across our end markets , we expect another year of steady core sales in 2026 , and we will continue to leverage the power of the Veralto enterprise system to drive continuous improvement in support of our customers , our financial position remains strong , and we will continue to evaluate strategic opportunities within our disciplined capital allocation framework .
Speaker #4: are We proud of the progress we've made on our as a young journey public company , and we are excited about the opportunities in front of us as we continue to build Veralto and help customers solve some of the world's biggest challenges in delivering clean water , safe food trusted and goods essential that concludes our prepared remarks .
Jennifer L. Honeycutt: That concludes our prepared remarks, and at this time, we are happy to take your questions.
Jennifer Honeycutt: That concludes our prepared remarks, and at this time, we are happy to take your questions.
Operator: Thank you. If you would like to ask a question, please press star 1 on your keypad. To leave the queue at any time, press star 2. Once again, that is star and 1 to ask a question. We will take our first question from Deane Dray with RBC Capital Markets. Please go ahead. Your line is open.
Operator: Thank you. If you would like to ask a question, please press star 1 on your keypad. To leave the queue at any time, press star 2. Once again, that is star and 1 to ask a question. We will take our first question from Deane Dray with RBC Capital Markets. Please go ahead. Your line is open.
Speaker #4: at this And time , we are happy to take your questions .
Speaker #2: you Thank . you would If like to ask a question , please press Star One on your keypad . To leave the queue at any time , press star two .
Speaker #2: Once again , that is star and one to ask a question . We will take first question our from DeAndre with Capital RBC Markets .
[Analyst] (RBC Capital Markets): Thank you. Good morning, everyone.
Deane Dray: Thank you. Good morning, everyone.
Jennifer L. Honeycutt: Good morning, Deane.
Jennifer Honeycutt: Good morning, Deane.
Speaker #2: Please go line ahead. Your line is open.
[Analyst] (RBC Capital Markets): Hey, since we're at the start of the year, I think it's a good place to get synced with the water sector macro. Just what's your expectations on utility CapEx, and just related, any differences in demand trends from your municipal customers versus the industrial, broadly industrial, commercial power, electrical, semiconductor, and so forth? So just start us there if you could, please.
Deane Dray: Hey, since we're at the start of the year, I think it's a good place to get synced with the water sector macro. Just what's your expectations on utility CapEx, and just related, any differences in demand trends from your municipal customers versus the industrial, broadly industrial, commercial power, electrical, semiconductor, and so forth? So just start us there if you could, please.
Speaker #6: Thank you . Good morning everyone .
Speaker #4: Good morning Dean .
Speaker #6: Hey . Since we're at the start of the year , I think it's a good place to get synced with the water sector macro .
Speaker #6: what's your Just expectations on Muni CapEx and just related any differences in demand trends from your municipal customers versus the industrial broadly industrial , commercial power , electrical And so forth .
Jennifer L. Honeycutt: Yeah, thanks for the question, Dean. What we see in the water quality markets is really steady demand, and I would say that we see that both across muni and industrial markets. Relative to your CapEx question, we are relatively insulated from fluctuations in CapEx funding cycles. As you know, 60% of our business is recurring revenue. We sit in the high end of the value chain where we are integral to the operation of the customer's process. They can choose not to use us, but the cost of failure or the risk of failure to them is going to be high. So highly sticky business, needed to continue to deliver clean water, and so we feel good about our position there. Relative to the demand between muni and industrial, we see pretty good opportunities on both sides.
Jennifer Honeycutt: Yeah, thanks for the question, Dean. What we see in the water quality markets is really steady demand, and I would say that we see that both across muni and industrial markets. Relative to your CapEx question, we are relatively insulated from fluctuations in CapEx funding cycles. As you know, 60% of our business is recurring revenue. We sit in the high end of the value chain where we are integral to the operation of the customer's process. They can choose not to use us, but the cost of failure or the risk of failure to them is going to be high. So highly sticky business, needed to continue to deliver clean water, and so we feel good about our position there. Relative to the demand between muni and industrial, we see pretty good opportunities on both sides.
Speaker #6: So , semiconductor . just start us there . If you could please .
Speaker #4: Yeah . Thanks question , for the Dean what we water see in the . You know quality really markets is steady demand . And I would say that we see that both across Muni and industrial markets , relative to your CapEx question , you know , we are relatively insulated from fluctuations in CapEx funding .
Speaker #4: cycles know As you , 60% of our business is recurring sit in the revenue . We high end of the value chain where we are integral to the operation of the customers process .
Speaker #4: They can choose not to use us , but the cost of failure or the risk of failure to them is going to be high .
Speaker #4: So highly sticky business needed to continue to deliver clean water and and so , we feel you know , about , you know , good our position there relative to the between muni demand and see pretty industrial .
Jennifer L. Honeycutt: Every year, we always see some fluctuations in which industrials are up or down. Currently, we're seeing strong read-through here in the industrial markets that really support data centers. So data centers themselves, precursors, which would include semiconductor, mining, and power as well. So strong growth, as we had mentioned in our prepared remarks, relative to those industrials. And then on the muni side, government funding continues to flow. So feel good about demand in both cases, and I think we're well set up here in 2026.
Jennifer Honeycutt: Every year, we always see some fluctuations in which industrials are up or down. Currently, we're seeing strong read-through here in the industrial markets that really support data centers. So data centers themselves, precursors, which would include semiconductor, mining, and power as well. So strong growth, as we had mentioned in our prepared remarks, relative to those industrials. And then on the muni side, government funding continues to flow. So feel good about demand in both cases, and I think we're well set up here in 2026.
Speaker #4: good on opportunities on We both sides know , every year we . always You see some fluctuations in which industrials up or are down .
Speaker #4: seeing strong Currently we're know , read through here in the , you industrial support data that really markets So centers centers . themselves data precursors which would include semiconductor mining and power as So well .
Speaker #4: growth as we had mentioned in strong our prepared remarks relative to those industrials . on the And then muni side , government continues to funding flow .
[Analyst] (RBC Capital Markets): That's really helpful. And then just a quick follow-up. It's come up in a number of calls across the sector regarding DRAM. Given across both of your businesses and the level of automation, are you seeing any pinches in supply or pricing, and could you size that for us if you could?
Deane Dray: That's really helpful. And then just a quick follow-up. It's come up in a number of calls across the sector regarding DRAM. Given across both of your businesses and the level of automation, are you seeing any pinches in supply or pricing, and could you size that for us if you could?
Speaker #4: So, feel good about in both demand. I think we're well set up here in 2026.
Speaker #6: That's really helpful . And then just a quick follow up . It's come up in a number of calls across the sector regarding Dram for given across both of your businesses in automation , are you the level of any seeing pinches and supply or pricing , and could you size it that for us ?
Sameer Ralhan: Yeah, Dean, just a minute. I'll take that one. No, our exposure, actually, in dollar terms, is very small to the DRAM site. So as we kind of looked at it and sized it, we don't expect it to be immaterial at this point.
Sameer Ralhan: Yeah, Dean, just a minute. I'll take that one. No, our exposure, actually, in dollar terms, is very small to the DRAM site. So as we kind of looked at it and sized it, we don't expect it to be immaterial at this point.
Speaker #6: If you could ?
Speaker #5: Yeah . I I'll take that one . No . Our exposure dollar terms is actually in very small to Dram the So kind of side .
[Analyst] (RBC Capital Markets): Good to hear. Thank you.
Deane Dray: Good to hear. Thank you.
Speaker #5: as we and size it , we don't it to be a expect material point at this .
Sameer Ralhan: Thanks, Dean.
Sameer Ralhan: Thanks, Dean.
Operator: Thank you. Our next question comes from Andy Kaplowitz with Citigroup. Please go ahead. Your line is open.
Operator: Thank you. Our next question comes from Andy Kaplowitz with Citigroup. Please go ahead. Your line is open.
Speaker #6: Good to hear . Thank you .
Speaker #5: team Thanks , .
Speaker #2: Thank you . Our next question comes from Andy Kaplowitz with Citigroup . Please go ahead . Your line is open .
[Analyst] (Citigroup): Good morning, everyone.
Andy Kaplowitz: Good morning, everyone.
Jennifer L. Honeycutt: Morning, Andy.
Jennifer Honeycutt: Morning, Andy.
[Analyst] (Citigroup): So maybe this one is for Sameer. You're guiding to 50 basis points of margin expansion in In-Situ, which is, I think, right in your incremental margin algorithm. But maybe you could give us some more color into the puts and takes you're seeing because I think you'll be lapping tariff-related headwind, I think you've said in the past, by Q2. But Deane asked the question on inflation. It's out there in different areas, and there are investments that you're making in In-Situ. Is that kind of front-end loaded? Any more color would be helpful.
Andy Kaplowitz: So maybe this one is for Sameer. You're guiding to 50 basis points of margin expansion in In-Situ, which is, I think, right in your incremental margin algorithm. But maybe you could give us some more color into the puts and takes you're seeing because I think you'll be lapping tariff-related headwind, I think you've said in the past, by Q2. But Deane asked the question on inflation. It's out there in different areas, and there are investments that you're making in In-Situ. Is that kind of front-end loaded? Any more color would be helpful.
Speaker #7: Good morning everyone .
Speaker #4: Morning , Andy .
Speaker #7: So maybe this one is for Sameer . You're guiding to 50 basis points of margin expansion X in situ , which is I think , right in your incremental margin algorithm .
Speaker #7: But maybe you could give us some more color puts and into the takes you're seeing . Because I think you'll be lapping tariff related headwinds .
Speaker #7: I think you've said in the past like like Q2 , but you know , Dean asked the question on inflation . It's out there , you know , in different areas .
Speaker #7: And their investments that you're in making situ is that kind of front end loaded any more color would be helpful .
Sameer Ralhan: Yeah, Andy. As you're going to look at the core business, we are guiding towards 50 basis points of margin expansion. Big chunk of that is actually pricing is driving it. And as you mentioned, some of the headwinds from the tariff-related friction that we had in 2025, those things will start rolling off. We're going to start seeing the impact of that in the second half of 2026 as we're going to look at it and model then. That's really offset by some of the investments that we continue to drive. You heard from Jennifer a little bit earlier about the investments you're making in the services as you're trying to expand that part of the business. And also just on the sales side, as we continue to increase feet on the ground as we're going to think about the sales side.
Sameer Ralhan: Yeah, Andy. As you're going to look at the core business, we are guiding towards 50 basis points of margin expansion. Big chunk of that is actually pricing is driving it. And as you mentioned, some of the headwinds from the tariff-related friction that we had in 2025, those things will start rolling off. We're going to start seeing the impact of that in the second half of 2026 as we're going to look at it and model then. That's really offset by some of the investments that we continue to drive. You heard from Jennifer a little bit earlier about the investments you're making in the services as you're trying to expand that part of the business. And also just on the sales side, as we continue to increase feet on the ground as we're going to think about the sales side.
Speaker #5: Yeah . Andy , as you look at the core business , you know , we are guiding 50 basis points of margin towards expansion .
Speaker #5: You know , big chunk of that is actually , you know , pricing is driving it . And as you mentioned , some of the headwinds from the tariff related friction that we had in 2025 , those things will start rolling off .
Speaker #5: We're going to start seeing the impact of that in the second half of 2026. As we kind of look at it and model, then that's really offset by some of the investments that continue to drive.
Speaker #5: we You heard from Jennifer bit a little earlier about the investments you're making , the services as you try to expand that part of the business .
Sameer Ralhan: So it's really the algorithm for the core business is steady as per the long-term value creation algorithm. So there's no changes over there. We feel pretty confident on that side. In-Situ, really great acquisition for us as we kind of get through some of the initial costs, especially in the first half of the year, to integrate and some of the cost tied to the realization of the synergies. Those are the kind of really things that are driving the upfront impact. And on a net year basis, that's going to be 25 basis points. So those are some of the puts and ticks as you're going to think about the margin expansion.
Sameer Ralhan: So it's really the algorithm for the core business is steady as per the long-term value creation algorithm. So there's no changes over there. We feel pretty confident on that side. In-Situ, really great acquisition for us as we kind of get through some of the initial costs, especially in the first half of the year, to integrate and some of the cost tied to the realization of the synergies. Those are the kind of really things that are driving the upfront impact. And on a net year basis, that's going to be 25 basis points. So those are some of the puts and ticks as you're going to think about the margin expansion.
Speaker #5: And also just on the sales side , as we continue to increase feet on the on the ground as we think about the sales side .
Speaker #5: So it's really the algorithm for the core business is steady as per the long-term value creation algorithm. So, changes over there's no—there.
Speaker #5: We feel pretty confident on that side . In situ , really great acquisition for for us as we kind of get through some of the initial costs , especially in the first half of the year , to integrate and some of the cost tied to realization of the the synergies .
Speaker #5: Those are the kind of really the things that are driving the upfront impact . And on a net basis , that's going to be 25 basis points .
[Analyst] (Citigroup): Got it. That's helpful. Jennifer, you mentioned data centers are strong. I know in the past you've said it's still a relatively small part of Veralto. But we've seen a wave of data center orders here over the last couple of quarters for a lot of industrial companies. Could we see the data center wave be sort of meaningful for you guys in growth in 2026, or is it still too small? Maybe you could elaborate on sort of your TAM and sort of what's going on there for you guys.
Andy Kaplowitz: Got it. That's helpful. Jennifer, you mentioned data centers are strong. I know in the past you've said it's still a relatively small part of Veralto. But we've seen a wave of data center orders here over the last couple of quarters for a lot of industrial companies. Could we see the data center wave be sort of meaningful for you guys in growth in 2026, or is it still too small? Maybe you could elaborate on sort of your TAM and sort of what's going on there for you guys.
Speaker #5: So those are some of the puts and takes as you're going to think about the margin expansion .
Speaker #7: Got that's helpful . And Jennifer you mentioned data centers are strong . I know in the past you've said it's still relatively small part of Veralto .
Speaker #7: But you know , we've seen a data center wave of orders here over the last couple of quarters for a lot of industrial companies .
Speaker #7: we Could see the data center wave be meaningful for you guys in growth in 26 , or is it still too small ? Maybe you could elaborate on sort of your Tam and sort of what's going on there for you guys ?
Jennifer L. Honeycutt: Yeah, Andy. We don't size our markets publicly, and I would say that our sales into data centers are still relatively small. We wouldn't expect to see a meaningful contribution this year, although the aggregation of power generation, cooling towers, mining, semiconductor, right, it does start to add up if you kind of include all of the ancillary vertical markets that go with it. But data centers specifically, again, small base of business, growing double digits, but not going to be a meaningful contributor to core growth this year.
Jennifer Honeycutt: Yeah, Andy. We don't size our markets publicly, and I would say that our sales into data centers are still relatively small. We wouldn't expect to see a meaningful contribution this year, although the aggregation of power generation, cooling towers, mining, semiconductor, right, it does start to add up if you kind of include all of the ancillary vertical markets that go with it. But data centers specifically, again, small base of business, growing double digits, but not going to be a meaningful contributor to core growth this year.
Speaker #4: we Yeah , Andy , don't size our markets And publicly . I would say that , you know , our , our sales into data centers are still relatively small .
Speaker #4: We wouldn't expect to see a meaningful contribution this year , although the aggregation of of power generation cooling towers , mining semiconductor . Right .
Speaker #4: It does start to add up . If you kind of include all of the ancillary vertical markets that go with it . But data centers specifically , again , small base of business grow in double digits .
[Analyst] (Citigroup): Helpful, guys. Thank you.
Andy Kaplowitz: Helpful, guys. Thank you.
Sameer Ralhan: Thanks, Andy.
Sameer Ralhan: Thanks, Andy.
Speaker #4: But not not going to be a meaningful contributor to core growth this year .
Operator: Thank you. We will move next with William Griffin with Barclays. Please go ahead. Your line is open.
Operator: Thank you. We will move next with William Griffin with Barclays. Please go ahead. Your line is open.
Speaker #7: Thank Helpful guys . you .
Speaker #5: Thanks , Andy .
Speaker #2: Thank you . We will move next with William Barclays . Please go ahead . Your line is open .
[Analyst] (Barclays): Thanks. Good morning, and I appreciate the time. My first question here just was hoping to drill down into PQI a little bit and perhaps specifically what you're seeing in that business as it pertains to this kind of high protein boom that we're seeing. Could that really start to be a volume driver within PQI? And just any color there would be helpful.
William Griffin: Thanks. Good morning, and I appreciate the time. My first question here just was hoping to drill down into PQI a little bit and perhaps specifically what you're seeing in that business as it pertains to this kind of high protein boom that we're seeing. Could that really start to be a volume driver within PQI? And just any color there would be helpful.
Speaker #8: morning Thanks . Good . And I appreciate the time . My first question here just was was hoping to drill down into Pcci a little bit and specifically perhaps what you're seeing in that business as it pertains this kind of high to protein boom that we're seeing .
Jennifer L. Honeycutt: Yeah, thanks for the question. Our CPG markets tend to be holding up really well. They're stable. We're not seeing any changes in demand patterns, good linearity across the four quarters. And within that, we've got solid demand across some of our new product innovations, UV laser. We've seen some good interest there. Relative to changes in terms of food products, package size, and so on, look, anytime changes get made to what is being produced, it's generally a nice pickup for us, right? So the secular drivers around the proliferation of brands, the proliferation of SKUs, changes in package size, even regulatory influences, right, those are all positive drivers for our business there. So we absolutely feel good about changes to packaged foods to support changes in dietary requirements and so on. So I think on the coating and marking side, that's a volume game for us.
Jennifer Honeycutt: Yeah, thanks for the question. Our CPG markets tend to be holding up really well. They're stable. We're not seeing any changes in demand patterns, good linearity across the four quarters. And within that, we've got solid demand across some of our new product innovations, UV laser. We've seen some good interest there. Relative to changes in terms of food products, package size, and so on, look, anytime changes get made to what is being produced, it's generally a nice pickup for us, right? So the secular drivers around the proliferation of brands, the proliferation of SKUs, changes in package size, even regulatory influences, right, those are all positive drivers for our business there. So we absolutely feel good about changes to packaged foods to support changes in dietary requirements and so on. So I think on the coating and marking side, that's a volume game for us.
Speaker #8: really start to be a volume within driver Could that Pcci and just any color there would be helpful ?
Speaker #4: Thanks for Yeah . the question . You know , CPG our markets tend to be holding up really well . They're not seeing stable .
Speaker #4: We're any changes in demand patterns . Good linearity across the four quarters . And you know , within that we've got solid across some of our new product innovations UV laser .
Speaker #4: We've we've seen some good there interest relative to changes in terms of of food products and package size and so on . Look , anytime changes get made to what is being produced , it's generally nice a pickup for us , right .
Speaker #4: So the secular drivers around the proliferation of brands , the proliferation of SKUs , changes in package size , even regulatory influences . Right .
Speaker #4: Those are all positive drivers business there . for our So we absolutely feel good about , you know , changes to packaged foods to changes in support dietary requirements on .
Jennifer L. Honeycutt: So the more packages, the more coding and marking equipment and consumables that gets sold into that space. So as far as protein-intensive consumer packaged goods goes, I think we're well positioned to capitalize on that.
Jennifer Honeycutt: So the more packages, the more coding and marking equipment and consumables that gets sold into that space. So as far as protein-intensive consumer packaged goods goes, I think we're well positioned to capitalize on that.
Speaker #4: and so on the marketing side , you know , So I think coding and volume game that's a for us . So the more the packages more you know , coding and marking and consumables equipment get sold that that into space .
Speaker #4: So as far as , as protein intensive packaged consumer goods goes , I think we're we're well positioned to on capitalize that .
[Analyst] (Barclays): Got it. Appreciate that. And then just one specifically on geographic performance in Q4. If we're doing the math right, it looks like Western Europe may have actually been down year-over-year in terms of core growth. Do you have any color or commentary on the drivers there?
William Griffin: Got it. Appreciate that. And then just one specifically on geographic performance in Q4. If we're doing the math right, it looks like Western Europe may have actually been down year-over-year in terms of core growth. Do you have any color or commentary on the drivers there?
Speaker #8: Appreciate Got it . that . And then just one specifically on geographic performance in four . Q if we're doing the math right , it Western Europe may have actually looks like been down year on year in terms of core growth .
Sameer Ralhan: Yeah. If you're going to look at the Western Europe, really, well, that's driven by the impact of the 3 days if you start looking on a year-over-year basis. As if you recall, we saw pretty solid growth in the Q1 across the regions, especially in the Western Europe as well, because we had 3 extra shipping days. That's really kind of driving the year-over-year comp as you can look at the Western Europe. There's nothing otherwise than that. So on a full-year basis, we feel pretty good if you're going to look at the growth in the Western Europe. Really great execution by the team on the water quality and the PQI side.
Sameer Ralhan: Yeah. If you're going to look at the Western Europe, really, well, that's driven by the impact of the 3 days if you start looking on a year-over-year basis. As if you recall, we saw pretty solid growth in the Q1 across the regions, especially in the Western Europe as well, because we had 3 extra shipping days. That's really kind of driving the year-over-year comp as you can look at the Western Europe. There's nothing otherwise than that. So on a full-year basis, we feel pretty good if you're going to look at the growth in the Western Europe. Really great execution by the team on the water quality and the PQI side.
Speaker #8: Do you have any color or commentary on the drivers there ?
Speaker #5: Is it Yeah . going to look at the Western Europe really ? Will . That's driven by the impact of the three you start days .
Speaker #5: looking on a If year over year basis , if you recall , we saw pretty solid growth in the Q1 across the regions , especially in the Western Europe as because we had three extra shipping well , days .
Speaker #5: really That's kind of driving the year over year comp , as we can look Western Europe at the , there's nothing otherwise . On a full year on that basis .
Speaker #5: We feel pretty good . If you kind of look at the Western growth in the Europe , really great execution by the team .
Jennifer L. Honeycutt: Yeah, our Recurring Revenue business is really what drives that, right? So 60% of the business being Recurring Revenue is going to have a pretty big impact when you've got days' fluctuation. You already see that in Q1 and Q4 last year.
Jennifer Honeycutt: Yeah, our Recurring Revenue business is really what drives that, right? So 60% of the business being Recurring Revenue is going to have a pretty big impact when you've got days' fluctuation. You already see that in Q1 and Q4 last year.
Speaker #5: On the water quality and the Pcci side .
Speaker #4: Yeah , our , our our recurring revenue business is really what what drives that . Right . So 60% of the business being recurring is going to have a revenue pretty big impact when you've got days fluctuation , you always see that in the in the first quarter and the fourth quarter last year .
[Analyst] (Barclays): Got it. Appreciate it. Thank you very much.
William Griffin: Got it. Appreciate it. Thank you very much.
[Analyst] (Citigroup): Thanks, Bill.
Andy Kaplowitz: Thanks, Bill.
Operator: Thank you. Our next question comes from John McNulty with BMO Capital Markets. Please go ahead. Your line is open.
Operator: Thank you. Our next question comes from John McNulty with BMO Capital Markets. Please go ahead. Your line is open.
Speaker #8: Got it . Appreciate it . Thank you very much .
Speaker #5: Bill Thanks , .
Speaker #5: Bill Thanks , .
Speaker #2: you Thank . Our next question comes from John McNulty with BMO Capital Markets . Please go ahead . Your line is open .
[Analyst] (BMO Capital Markets): Yeah, good morning. Thanks for taking my question. Maybe just digging into the guide a little bit. You're looking for mid- to high single-digit EPS growth, and yet your growth overall on the top line is kind of in line with what you've seen over the last couple of years when you put up double-digit EPS growth. So I guess, is there anything that gives you some pause, either in the end markets or on the cost side, that has you forecasting EPS growth that's a little bit more modest than what you've seen over the last couple of years?
John McNulty: Yeah, good morning. Thanks for taking my question. Maybe just digging into the guide a little bit. You're looking for mid- to high single-digit EPS growth, and yet your growth overall on the top line is kind of in line with what you've seen over the last couple of years when you put up double-digit EPS growth. So I guess, is there anything that gives you some pause, either in the end markets or on the cost side, that has you forecasting EPS growth that's a little bit more modest than what you've seen over the last couple of years?
Speaker #9: Yeah . Good morning . Thanks for taking my question . Maybe just into the digging into the guide a little bit . You know , you're looking for mid to high single digit EPs growth and yet you know your growth overall on the top line .
Speaker #9: You is kind of in line with what you've seen over the last couple of years . When you put up double digit EPs growth .
Speaker #9: So, I guess, is there anything that gives you some pause, either end in the markets or on the cost side, that has you forecasting EPS growth?
Sameer Ralhan: Yeah, John, thanks for that question. Look, as we're going to look at the guide overall, maybe just John start from the top for the P&L. For the core growth perspective, we expect to be in the little bit single-digit as we kind of came out of the year. I think it just makes sense for us to be prudent. There's still some moving parts on the macro perspective. But underlying demands are pretty good and pretty solid, so we feel pretty confident on the demand side. But as you kind of move further down, we'll have the margin expansion of roughly 25 basis points, including the impact of the In-Situ acquisition. That really boils down to EPS growth in the mid to high single digits. There's nothing material, John, anything on the cost side. So we'll have the top line growth, the margin expansion that's ultimately coming down.
Sameer Ralhan: Yeah, John, thanks for that question. Look, as we're going to look at the guide overall, maybe just John start from the top for the P&L. For the core growth perspective, we expect to be in the little bit single-digit as we kind of came out of the year. I think it just makes sense for us to be prudent. There's still some moving parts on the macro perspective. But underlying demands are pretty good and pretty solid, so we feel pretty confident on the demand side. But as you kind of move further down, we'll have the margin expansion of roughly 25 basis points, including the impact of the In-Situ acquisition. That really boils down to EPS growth in the mid to high single digits. There's nothing material, John, anything on the cost side. So we'll have the top line growth, the margin expansion that's ultimately coming down.
Speaker #9: That's a little bit more modest than what you've seen over the last couple of years .
Speaker #5: John , thanks Yeah , for that question . Look , as we kind of look at the guide overall , maybe just John , start from the top of the is , you know , for PNL the core growth perspective , we expect to be in the low to mid single digit as we kind of came out of the year .
Speaker #5: I think it just makes sense for us to be prudent at the there's still some moving parts of the macro perspective , but underlying demands are pretty good and pretty pretty solid .
Speaker #5: So we feel pretty confident on the demand side . But as you kind of move further down , we'll have the margin expansion of roughly 25 basis points , including the impact of the in situ acquisition that really boils down to EPs growth in the mid to single high digits .
Speaker #5: You know , there's nothing . material John , cost anything on the side . So we'll have the top line growth , the margin expansion that's ultimately coming down .
Sameer Ralhan: The only other impact I would see on the EPS side is from the In-Situ perspective. There's going to be an accretion to the earnings, operating earnings of $0.02 per share, but there is a $0.04 dilution from the lack of interest income because of the cash being used. So that's kind of baked into the EPS as well. So just as you do your math.
Sameer Ralhan: The only other impact I would see on the EPS side is from the In-Situ perspective. There's going to be an accretion to the earnings, operating earnings of $0.02 per share, but there is a $0.04 dilution from the lack of interest income because of the cash being used. So that's kind of baked into the EPS as well. So just as you do your math.
Speaker #5: really the only other It's impact , I would say , on the EPs side is situ from the in perspective , it's it's going to be accretive to the earnings operating earnings from $0.02 per share .
Speaker #5: But there is a $0.04 dilution from the lack of interest income because of the cash being used . So that's kind of baked into the EPs as well .
[Analyst] (BMO Capital Markets): Got it. Fair enough. And then just a question on the data center opportunity and the markets. I think recently, it became more clear that there's an opportunity for warmer water cooling as opposed to refrigerated water cooling. Can you help us to think about if that changes the game for Veralto at all in terms of how they target and maybe benefit from the data center growth as we look forward?
John McNulty: Got it. Fair enough. And then just a question on the data center opportunity and the markets. I think recently, it became more clear that there's an opportunity for warmer water cooling as opposed to refrigerated water cooling. Can you help us to think about if that changes the game for Veralto at all in terms of how they target and maybe benefit from the data center growth as we look forward?
Speaker #5: So just as you do your math.
Speaker #9: Got it . Fair enough . And then just a question on the on the data center opportunity and the markets , I think recently it became more clear there's an opportunity that for warmer water cooling as opposed to as opposed to refrigerated water cooling .
Speaker #9: Can you help us to think about if changes the game for Veralto at all in terms of how they target and maybe benefit from the data center growth?
Jennifer L. Honeycutt: Yeah, this is a great question, John. Liquid cooling tends to increase the need for Veralto solutions because it's really a smaller volume of water focused on high-purity fluids. And these need to be monitored along with ensuring sort of continuous chemical control and monitoring. So it doesn't really matter in terms of what the temperature of that water is. And even though in these cases where it's a closed-loop system, liquid cooling using less water, it's more valuable. You can think of it as more valuable water, right? So there's precision dosing to prevent corrosion and biofouling. That supports our ChemTreat business. You've got continuous monitoring of ultra-low-range organics such as TOC. That benefits our Hach business. And then you've got high-purity disinfection needs there, which benefits our Trojan business.
Jennifer Honeycutt: Yeah, this is a great question, John. Liquid cooling tends to increase the need for Veralto solutions because it's really a smaller volume of water focused on high-purity fluids. And these need to be monitored along with ensuring sort of continuous chemical control and monitoring. So it doesn't really matter in terms of what the temperature of that water is. And even though in these cases where it's a closed-loop system, liquid cooling using less water, it's more valuable. You can think of it as more valuable water, right? So there's precision dosing to prevent corrosion and biofouling. That supports our ChemTreat business. You've got continuous monitoring of ultra-low-range organics such as TOC. That benefits our Hach business. And then you've got high-purity disinfection needs there, which benefits our Trojan business.
Speaker #9: As we look forward
Speaker #9: ?
Speaker #4: This question , John . You know , liquid cooling tends to increase the need for Veralto solutions because it's really a smaller volume of water focused on high purity fluids .
Speaker #4: is great
Speaker #4: And these need to be monitored along with ensuring sort of continuous chemical control and monitoring . Monitoring . So it doesn't really matter in terms of what the temperature of that water is .
Speaker #4: And even though in these cases where , you know , it's a closed loop system , liquid cooling , using less water , it's more valuable , you can think of it as more valuable water .
Speaker #4: Right ? So precision there's dosing to prevent corrosion . And biofouling that supports our treat business . You've got continuous monitoring of ultra low range organics such as TOC that benefits our Hawk business .
Jennifer L. Honeycutt: So we do get this question from time to time, and it's really not a function of the temperature of the water. It's the fact that water is used at all. And the lower the volume of water you use, the higher the need to have precision control over that water to make sure that that process is running well and not creating problems and other kinds of quality risks for the data centers themselves. So that's the way to think about it.
Jennifer Honeycutt: So we do get this question from time to time, and it's really not a function of the temperature of the water. It's the fact that water is used at all. And the lower the volume of water you use, the higher the need to have precision control over that water to make sure that that process is running well and not creating problems and other kinds of quality risks for the data centers themselves. So that's the way to think about it.
Speaker #4: And then you've got high-purity disinfection needs there, which benefits our Trojan business. So, you know, we do get this from time to time in question sessions.
Speaker #4: And it's really function of the of the water . It's the temperature fact that water is used at all . And the , the lower the volume of water you use , the higher the need to have precision control over that water to make sure that that process is , is , is running well and not creating , you know , problems and other kinds of quality risks for the data centers themselves .
[Analyst] (BMO Capital Markets): Got it. Thanks very much for the color.
John McNulty: Got it. Thanks very much for the color.
Speaker #4: So that's the way to, to think about it.
Operator: Thank you. We will move next with Jacob Levinson with Melius Research. Please go ahead. Your line is open.
Operator: Thank you. We will move next with Jacob Levinson with Melius Research. Please go ahead. Your line is open.
Speaker #9: Got it . Thanks very much color for the .
Speaker #2: Thank you . We will move next with Jacob Levinson , with Melius Research . Please go ahead . Your line is open .
[Analyst] (Melius Research): Hi. Good morning, everyone.
Jacob Levinson: Hi. Good morning, everyone.
Jennifer L. Honeycutt: Good morning, Jake.
Jennifer Honeycutt: Good morning, Jake.
[Analyst] (Melius Research): You folks have done a couple of interesting bolt-on deals the last two years. Now you've got a new buyback authorization, and the balance sheet's in a pretty nice spot here. Maybe you can just speak to your confidence in maybe getting some more deals across the goal line in 2026 and any color around just the activity levels that are happening behind the scenes here.
Jacob Levinson: You folks have done a couple of interesting bolt-on deals the last two years. Now you've got a new buyback authorization, and the balance sheet's in a pretty nice spot here. Maybe you can just speak to your confidence in maybe getting some more deals across the goal line in 2026 and any color around just the activity levels that are happening behind the scenes here.
Speaker #10: Hi . Good morning everyone .
Speaker #4: Good morning Jake .
Speaker #10: folks have You done a couple of interesting bolt on deals the last two years , and buyback you've got a now new authorization and the balance sheets a pretty in a in nice spot here .
Speaker #10: But maybe you can just speak to your confidence and maybe getting some more deals across the goal line in '26. And any color around just the activity levels that are happening behind the scenes here.
Ryan Taylor: Yeah, thanks for the question, Jake. We feel good about the level of activity we've got right now in our M&A pursuits. We've got full funnels both on water quality and PQI and continue to work on a number of different opportunities, which we do believe are actionable. That said, we're going to hold true to our discipline here in terms of making sure that we like the market, that we've got a top-tier asset, and that we can get it at the right valuation. We don't always. There's a lot about that that we don't control, and timing tends to be a little bit episodic. But we are excited about what we have in the funnel, do believe that we will be continuing on our M&A journey this year.
Jennifer Honeycutt: Yeah, thanks for the question, Jake. We feel good about the level of activity we've got right now in our M&A pursuits. We've got full funnels both on water quality and PQI and continue to work on a number of different opportunities, which we do believe are actionable. That said, we're going to hold true to our discipline here in terms of making sure that we like the market, that we've got a top-tier asset, and that we can get it at the right valuation. We don't always. There's a lot about that that we don't control, and timing tends to be a little bit episodic. But we are excited about what we have in the funnel, do believe that we will be continuing on our M&A journey this year.
Speaker #4: Yeah , thanks for the question , We feel good about the level of activity we've got right now in our M&A pursuits . We've got full funnels both on water quality and PKI , and continue to work on a number of different opportunities , which we do believe are are actionable .
Speaker #4: You know , that said , we've got we're going to hold true to our discipline here in terms of making sure that we like the that we've got market , a top tier asset and that we can get it at the right valuation .
Speaker #4: You know , we don't always you know , there's a lot about that that we don't control . to be a And timing tends little bit episodic .
Speaker #4: But we are excited about what we have in the funnel . Do believe that we will be continuing on our M&A journey this year .
Ryan Taylor: And relative to share buybacks, that just gives us another lever here in terms of the way to return value to shareholders. Should we see a period here where we're going to be a little bit lighter in M&A? But I would say even with that program in place, it takes nothing away from our ability to transact on our aspirations here relative to M&A.
Jennifer Honeycutt: And relative to share buybacks, that just gives us another lever here in terms of the way to return value to shareholders. Should we see a period here where we're going to be a little bit lighter in M&A? But I would say even with that program in place, it takes nothing away from our ability to transact on our aspirations here relative to M&A.
Speaker #4: And you know , relative to to share buybacks , that just gives us another another lever here in terms of the way to return value to shareholders .
Speaker #4: Should we see a period here where , you know , we're we're going to be a little bit lighter in M&A . But I would say even with that program in place , it takes nothing away from our ability to transact on our aspirations here relative to M&A .
[Analyst] (Melius Research): Okay. That makes sense. And just another one quickly on In-Situ. It seems like a pretty interesting asset. And I'm just trying to get a sense of what the integration plan might look like. I'd have to imagine it's maybe a bit subscale, and a lot of these private assets tend to need some help operationally or maybe just need to be larger. So maybe you can speak to where the low-hanging fruit is or the biggest opportunities that you see.
Jacob Levinson: Okay. That makes sense. And just another one quickly on In-Situ. It seems like a pretty interesting asset. And I'm just trying to get a sense of what the integration plan might look like. I'd have to imagine it's maybe a bit subscale, and a lot of these private assets tend to need some help operationally or maybe just need to be larger. So maybe you can speak to where the low-hanging fruit is or the biggest opportunities that you see.
Speaker #10: Okay . That makes sense . And just another one quickly on on Nrk2 , it seems like a pretty interesting asset . And I'm just trying to get a sense of of what the , the integration plan might look like .
Speaker #10: I'd have to imagine it's maybe a bit subscale and , and a lot is private assets tend to need some help operationally or maybe to be speak larger you can just need .
Jennifer L. Honeycutt: Yeah, great question. We're really excited about the In-Situ acquisition and certainly have plans to realize synergies on both the top line and the bottom line. I would say right out of the gate, we're most excited about the top line synergies, to be honest. We've got a good opportunity to accelerate growth. And as a reminder, In-Situ's grown 8% over the last three or so years. We believe we can get that to low double digits here with the combination of the OTT portfolio. The thing that's so attractive about this is that they are complementary product portfolios. So In-Situ is strong in water quality. So that would be the analytics measurements in environmental water. And OTT is strong in water quantity, which would be level and flow. And together, the product portfolio really snaps together like Lego pieces.
Jennifer Honeycutt: Yeah, great question. We're really excited about the In-Situ acquisition and certainly have plans to realize synergies on both the top line and the bottom line. I would say right out of the gate, we're most excited about the top line synergies, to be honest. We've got a good opportunity to accelerate growth. And as a reminder, In-Situ's grown 8% over the last three or so years. We believe we can get that to low double digits here with the combination of the OTT portfolio. The thing that's so attractive about this is that they are complementary product portfolios. So In-Situ is strong in water quality. So that would be the analytics measurements in environmental water. And OTT is strong in water quantity, which would be level and flow. And together, the product portfolio really snaps together like Lego pieces.
Speaker #10: where So maybe the to the low hanging fruit is biggest or the opportunities that you see .
Speaker #4: Yeah . Great question . We're really excited about the in situ acquisition . And certainly have plans to realize synergies on both the top line and the bottom line , I would say right out of the gate , we're most excited about the top line synergies .
Speaker #4: To be honest . We've got a good opportunity to accelerate growth . And as a reminder , in situ grown 8% over the last , you know , three or so years , we believe we can get that to to low double digits here with the combination of the OT portfolio .
Speaker #4: The thing that that that's so attractive about this is that they are complementary product portfolios . So in situ is strong in water quality .
Speaker #4: So that would be the analytics measurements in environmental water . And OTT is strong in water quantity which would be level . And flow .
Jennifer L. Honeycutt: So the combined product portfolio is going to give us strengths. Going forward with complementary channels, right? In-Situ is predominantly a North American company. And so we've got the opportunity to leverage our channels outside the US, including Europe, Latin America, and Asia. And then certainly, to your point, Jake, they're going to benefit from the VES tools, whether that's those being deployed on the factory floor for improved operating efficiency or those deployed for our commercial efforts in helping them really grow faster. We're going to also look to the cost synergy side of things. We will move in parallel with our top line synergy activity here. And these would fall into things that you typically expect. So VES on the factory floor, improving operating efficiency.
Jennifer Honeycutt: So the combined product portfolio is going to give us strengths. Going forward with complementary channels, right? In-Situ is predominantly a North American company. And so we've got the opportunity to leverage our channels outside the US, including Europe, Latin America, and Asia. And then certainly, to your point, Jake, they're going to benefit from the VES tools, whether that's those being deployed on the factory floor for improved operating efficiency or those deployed for our commercial efforts in helping them really grow faster. We're going to also look to the cost synergy side of things. We will move in parallel with our top line synergy activity here. And these would fall into things that you typically expect. So VES on the factory floor, improving operating efficiency.
Speaker #4: And together, the product portfolio really snaps together like Lego pieces. So you know, the combined product portfolio is going to give us strength going for complementary channels, right? Sutian is predominantly a North American company.
Speaker #4: And so we've got the opportunity to leverage OTT channels outside the US , including Europe , Latin America and Asia . And then certainly to your point , Jake , they're going to benefit from , you know , the Viz whether tools , that's those being deployed on the factory floor for improved operating efficiency or those deployed for our commercial efforts .
Speaker #4: In them helping , you know , really grow faster . You know , we're going to also look to the cost synergy side of things .
Speaker #4: We will move in parallel with our top line synergy activity here . And these would fall into things that you typically expect . So you know , viz on the factory floor , improving operating efficiency .
Jennifer L. Honeycutt: We're going to have opportunities to leverage global supply chain in our procurement teams through purchase price variance and insourcing activities, and then just globalizing or optimizing the global resources. So a number of things there. The teams will be busy and running at breakneck pace, but I think we're really excited about the possibilities here.
Jennifer Honeycutt: We're going to have opportunities to leverage global supply chain in our procurement teams through purchase price variance and insourcing activities, and then just globalizing or optimizing the global resources. So a number of things there. The teams will be busy and running at breakneck pace, but I think we're really excited about the possibilities here.
Speaker #4: going to have We're opportunities to level leverage global procurement supply chain . And our teams through purchase price variance and insourcing activities . And then just globalizing or optimizing global the resources .
Speaker #4: So a number of the things there , teams will be busy and running at breakneck pace . But I think we're really excited about the possibilities here .
[Analyst] (Melius Research): That's great color, Jennifer. Thank you. I'll pass it on.
Jacob Levinson: That's great color, Jennifer. Thank you. I'll pass it on.
Operator: Thank you. We will move next with Ryan Connors with North Coast Research. Please go ahead. Your line is open.
Operator: Thank you. We will move next with Ryan Connors with North Coast Research. Please go ahead. Your line is open.
Speaker #10: That's great. Thank you. I'll pass it on.
Speaker #2: Thank you. We will move next to Connors with North Research. Please go ahead, your line is open.
[Analyst] (Barclays): Good morning. Thanks for taking my question. I wanted to talk a little bit about the water segment. It seems like the growth has been there generally. Obviously, you've got some great secular themes behind that. It does seem like the growth has been more price-driven and that the volume growth has been a little more tepid. Can you just unpack for us what's it going to take in your mind to kind of unlock the volume growth in water, given that you do have such compelling big-picture themes behind it?
Ryan Connors: Good morning. Thanks for taking my question. I wanted to talk a little bit about the water segment. It seems like the growth has been there generally. Obviously, you've got some great secular themes behind that. It does seem like the growth has been more price-driven and that the volume growth has been a little more tepid. Can you just unpack for us what's it going to take in your mind to kind of unlock the volume growth in water, given that you do have such compelling big-picture themes behind it?
Speaker #11: morning . Thanks for taking Good my question . I wanted to talk a little bit about the water segment , and it seems like the growth there has been generally .
Speaker #11: Obviously , you've got secular some great themes that , but it behind does seem like the growth has been more price driven and that the volume growth has been a little more tepid .
Speaker #11: So can you just unpack for us what's it going to take in your mind to kind of volume unlock the water , growth given that you do have such , such compelling big picture themes it ?
Sameer Ralhan: Hey, Ryan. This is Sameer. Yeah, as you kind of look at the water side, you're absolutely right. We feel really excited about the opportunity that's in front of us. The steady demand drivers, both in the muni and the industrial side, continue. Overall, if you're going to unpack between the industrial and the muni side, the muni side, actually, we've been doing really well. You noticed some of those things on the pricing side, but the underlying volumes have been pretty good as well. Industrial side, I would say, when you start looking at things like the data center ecosystem, as Jennifer said earlier, and those kind of industries, be it semiconductors, on the power, all the ancillary systems around the data centers, they're kind of helping us drive the volume as well.
Sameer Ralhan: Hey, Ryan. This is Sameer. Yeah, as you kind of look at the water side, you're absolutely right. We feel really excited about the opportunity that's in front of us. The steady demand drivers, both in the muni and the industrial side, continue. Overall, if you're going to unpack between the industrial and the muni side, the muni side, actually, we've been doing really well. You noticed some of those things on the pricing side, but the underlying volumes have been pretty good as well. Industrial side, I would say, when you start looking at things like the data center ecosystem, as Jennifer said earlier, and those kind of industries, be it semiconductors, on the power, all the ancillary systems around the data centers, they're kind of helping us drive the volume as well.
Speaker #5: Hey , Ryan , this Amir . Yeah . So you can look at the water side . You . Absolutely right . You know , we feel , you know , really excited about the opportunity that in front of us .
Speaker #5: The steady demand drivers both in the muni and the industrial side are , you continue overall if you're going to unpack between the industrial and the muni side , the muni side , actually , we've been doing really well .
Speaker #5: You notice some of those things on the pricing side , but the underlying volumes have been pretty good as well . Industrial side , I would say , you know , it's when you start looking at things the data center like ecosystem , as Jennifer said and those earlier , kind of industries , be it , you know , semiconductors on the power , all the ancillary around the data centers , they're systems kind of helping us drive the volume as well as you kind of look at our know , you'll see filings , you a little bit of commentary around the chemical treatment side , which is , you know , the chem treat and the UV side .
Sameer Ralhan: As you kind of look at our filings, you'll see a little bit of commentary around the chemical treatment side, which is the ChemTreat and the UV side. Those businesses are growing sort of solidly in the mid-single to mid-single-digit cost kind of a range. And the muni business is a little slower grower, but it's a steady rock solid, as you know, given the stickiness of that business in the market. So overall, as you're going to start to look long term, Ryan, we're in a really, really solid place. Now, 2025, just with a three-day dynamic that moved between Q1 and Q4 makes the numbers look a little bit odd. But otherwise, if you look on a full-year basis, we're doing really well.
Sameer Ralhan: As you kind of look at our filings, you'll see a little bit of commentary around the chemical treatment side, which is the ChemTreat and the UV side. Those businesses are growing sort of solidly in the mid-single to mid-single-digit cost kind of a range. And the muni business is a little slower grower, but it's a steady rock solid, as you know, given the stickiness of that business in the market. So overall, as you're going to start to look long term, Ryan, we're in a really, really solid place. Now, 2025, just with a three-day dynamic that moved between Q1 and Q4 makes the numbers look a little bit odd. But otherwise, if you look on a full-year basis, we're doing really well.
Speaker #5: businesses are Those growing sort of solidly in the mid to mid single digit plus kind of a range the . And business little muni slower is a grower , but it's a steady rock solid , as you know , you know with the given the stickiness of that business in the overall , as market .
Speaker #5: you're going to start So long look term Ryan , really , really place . solid you know Now 2025 just with a three day dynamic that moved between and Q1 Q1 .
Speaker #5: And has Q4 makes the numbers little bit look a otherwise , odd . But on a full if you look year you'll be basis , doing really well .
[Analyst] (Barclays): Got it. Okay.
Ryan Connors: Got it. Okay.
Sameer Ralhan: On a full-year basis, water quality was up more than 3%.
Sameer Ralhan: On a full-year basis, water quality was up more than 3%.
[Analyst] (Barclays): Yep. Okay. And then switching gears over to PQI, also some great big-picture themes there, especially with the combination now of Esko and TraceGains. But can you talk about how exactly you monetize that demand? Is it more subscriber licenses and existing accounts? Is it adding new accounts? Is it higher pricing for existing users? Just curious if you can give us some more color on better understanding how you actually convert that demand into revenue and earnings.
Ryan Connors: Yep. Okay. And then switching gears over to PQI, also some great big-picture themes there, especially with the combination now of Esko and TraceGains. But can you talk about how exactly you monetize that demand? Is it more subscriber licenses and existing accounts? Is it adding new accounts? Is it higher pricing for existing users? Just curious if you can give us some more color on better understanding how you actually convert that demand into revenue and earnings.
Speaker #11: Got it . Okay
Speaker #11: .
Speaker #5: volume . Full year You know , bases water quality was up more than 3% .
Speaker #11: Yep . Okay . And then switching gears over PKI , you to know , also some great big picture themes there , especially with the combination now of ESCO and Tracegains .
Speaker #11: But can you talk about how exactly you monetize demand ? that Is it more it is subscriber licenses at existing accounts ? Is it adding new accounts ?
Speaker #11: Is it you know , higher pricing for existing users ? Just just curious if you can give us some more color on better understanding how you actually convert that demand into , into into revenue and earnings ?
Jennifer L. Honeycutt: Yeah. So our Esko and TraceGains businesses together are growing really well in the software space. As you mentioned, on the back of some secular growth drivers relative to digitized workflows across food and beverage, and things to that effect, these are SaaS-based businesses, right? So we've got recurring revenue in terms of the mechanics behind how revenue is recognized there. I would say one of the things that was so attractive about TraceGains is that they had a leading position in mid-market brands. Esko largely has the enterprise brands. And so the cross-pollination of the two allows the TraceGains channel to bring Esko into mid-market and the Esko channel to bring TraceGains into enterprise accounts. So there is a fair number of new accounts, new business that we see there. And the fastest growing sector is mid-market. But we also see product expansion happening.
Jennifer Honeycutt: Yeah. So our Esko and TraceGains businesses together are growing really well in the software space. As you mentioned, on the back of some secular growth drivers relative to digitized workflows across food and beverage, and things to that effect, these are SaaS-based businesses, right? So we've got recurring revenue in terms of the mechanics behind how revenue is recognized there. I would say one of the things that was so attractive about TraceGains is that they had a leading position in mid-market brands. Esko largely has the enterprise brands. And so the cross-pollination of the two allows the TraceGains channel to bring Esko into mid-market and the Esko channel to bring TraceGains into enterprise accounts. So there is a fair number of new accounts, new business that we see there. And the fastest growing sector is mid-market. But we also see product expansion happening.
Speaker #4: Yeah . So our ESCO and Tracegains , you know , businesses together are are growing really well in the software space . As you mentioned on the back of some growth secular relative to , you know , digitized workflows across food and beverage and things to that effect , you are know , these SaaS based businesses , right ?
Speaker #4: we've So got recurring revenue in terms of of of of the mechanics behind , you know , how how revenue is recognized . There .
Speaker #4: I would say, you know, one of the things that was so attractive about TraceGains is that they had a leading position in mid-market brands.
Speaker #4: ESCO largely has enterprise the brands . And so cross-pollination of the the two allows , you know , the Tracegains channel to bring ESCO into mid-market and the ESCO channel to bring Tracegains into enterprise accounts .
Speaker #4: So there fair is a number of of new accounts , new that business see there . we it's the fastest And growing sector is mid-market .
Jennifer L. Honeycutt: So WebCenter Go is kind of the backbone of Esko. We've now integrated the TraceGains AI offering into that backbone through a product called Comply AI. That allows for automated AI verification of copied print in packaged goods. And as we mentioned in the prepared remarks, helps reduce transcription errors, costly product recalls, and so on. So it's both menu expansion, and it's new customers.
Jennifer Honeycutt: So WebCenter Go is kind of the backbone of Esko. We've now integrated the TraceGains AI offering into that backbone through a product called Comply AI. That allows for automated AI verification of copied print in packaged goods. And as we mentioned in the prepared remarks, helps reduce transcription errors, costly product recalls, and so on. So it's both menu expansion, and it's new customers.
Speaker #4: also But we see product expansion happening . So , you know , Webcenter go is kind of the backbone of ESCO . We've now the integrated trace AI into that offering backbone through a product called comply AI .
Speaker #4: That allows for automated , you know , AI verification of copied print in packaged in , packaged packaged goods . And as we mentioned , in the prepared remarks , helps reduce , you know , errors , transcription errors , costly product recalls , and so on .
[Analyst] (Barclays): Got it. Thanks for your time.
Ryan Connors: Got it. Thanks for your time.
Speaker #4: So it's both menu expansion and it's new customers.
Sameer Ralhan: Thanks, Ryan.
Sameer Ralhan: Thanks, Ryan.
Operator: Thank you. We will move next with Nathan Jones with Stifel. Please go ahead. Your line is open.
Operator: Thank you. We will move next with Nathan Jones with Stifel. Please go ahead. Your line is open.
Speaker #11: Got it. Thanks for your time.
Speaker #5: Thanks , Ryan .
Speaker #2: Thank you . We will next with move Nathan Jones with Stifel . Please ahead . Your line is go open .
[Analyst] (Stifel): Good morning, everyone.
Nathan Jones: Good morning, everyone.
Jennifer L. Honeycutt: Good morning, Nathan.
Jennifer Honeycutt: Good morning, Nathan.
[Analyst] (Stifel): I guess I'll start with a fairly basic question out of the guidance. A lot of mid-single digits is a pretty wide range. Can you talk about what will get you to the low end of that range, what will get you to the high end of that range? And then the 50 basis points core margin expansion, would that change if you were at the low end or at the high end? Can you do 50 basis points on low single-digit growth, and maybe you get a little bit better than that if you get to mid-single-digit growth? Just any color you could give us on the width of that range.
Nathan Jones: I guess I'll start with a fairly basic question out of the guidance. A lot of mid-single digits is a pretty wide range. Can you talk about what will get you to the low end of that range, what will get you to the high end of that range? And then the 50 basis points core margin expansion, would that change if you were at the low end or at the high end? Can you do 50 basis points on low single-digit growth, and maybe you get a little bit better than that if you get to mid-single-digit growth? Just any color you could give us on the width of that range.
Speaker #3: Good morning everyone .
Speaker #4: morning Nathan .
Speaker #12: I guess Good I'll guess I'll start with a fairly basic question out of the guidance . The low to mid single digits range are pretty wide .
Speaker #12: will get you to the Can you talk about what low end of that range ? What will get you to the high end of that range , and then the 50 basis points margin core expansion .
Speaker #12: You were at change if the low end, or would that high end, at the like—can you do 50 basis points on digit low single growth.
Speaker #12: And little bit better than get a that if maybe you you get to growth , just mid-single digit any color you could give us on , you know , the width of range that .
Sameer Ralhan: Yeah. Nathan, thanks for that question. As you kind of look at the top line from a core growth perspective, low single-digit to mid-single-digit range, really, as you kind of come out of the year, the demand underlying patterns are pretty good. Frankly, Q1 out of the gate, the order patterns are looking pretty good as well. So we feel pretty good about the business. But there's still things on the macro side you always have to keep an eye on. And it's just the beginning of the year. So we just wanted to have a guide that's a little prudent and a little judicious at this time. Overall, we feel pretty good about the business. As it kind of pertains to its impact on the margin side, you're absolutely right.
Sameer Ralhan: Yeah. Nathan, thanks for that question. As you kind of look at the top line from a core growth perspective, low single-digit to mid-single-digit range, really, as you kind of come out of the year, the demand underlying patterns are pretty good. Frankly, Q1 out of the gate, the order patterns are looking pretty good as well. So we feel pretty good about the business. But there's still things on the macro side you always have to keep an eye on. And it's just the beginning of the year. So we just wanted to have a guide that's a little prudent and a little judicious at this time. Overall, we feel pretty good about the business. As it kind of pertains to its impact on the margin side, you're absolutely right.
Speaker #5: Nathan , thanks for that question . you kind of Yeah . As the look at top a core growth perspective , line from low mid-single single range digits to digit , really , as you kind of the come out of year , the demand underlying patterns are pretty , pretty good , frankly , Q1 out of the gate , the order patterns are looking pretty good as well .
Speaker #5: So we feel pretty good about the business . But there's still things are the macro side , you know , you always have to keep an eye on .
Speaker #5: And it's just the beginning of the year . So we just wanted to have a guide that's a little prudent and a judicious at this time .
Sameer Ralhan: Given the fall-through and the leverage you would expect in the system as we kind of move up, that should help us. But we do have flexibility to modulate some of the cost side as well, right, depending on whether we are trending on the low side or the high side. So I think it's good at this point to model in 20 basis points on the core side, but more to come as we kind of give the Q1 guide.
Sameer Ralhan: Given the fall-through and the leverage you would expect in the system as we kind of move up, that should help us. But we do have flexibility to modulate some of the cost side as well, right, depending on whether we are trending on the low side or the high side. So I think it's good at this point to model in 20 basis points on the core side, but more to come as we kind of give the Q1 guide.
Speaker #5: Overall , we feel pretty good about the business as it kind of pertains to its impact on the margin side . You're absolutely right .
Speaker #5: You know , given the fall through and the leverage you would expect in the system , as we kind of move up , that should help us , you know , but we do have flexibility to modulate some of the cost side as well .
Speaker #5: Right . Depending on whether trending on the low side we are or the high side . So I think it's good at this points .
Speaker #5: Right . Depending on whether trending on the low side we are or the high side . So I think it's good at this to 20 basis model in On the core side , but as we kind more to come of give the Q1 guidance .
[Analyst] (Stifel): Then, I guess my follow-up question on supply chain moves and some of the regionalization of footprint, Jennifer, that you talked about in your opening comments: maybe a little bit more color around what's been done there. I know some of that was kind of tariff avoidance kind of things. So, might be okay regardless of tariffs. Is there incremental profitability that drops through from that that contributes to margin expansion and that maybe offsets some price that maybe you don't take? Or just how you're thinking about your ability to keep that improvement in cost things?
Nathan Jones: Then, I guess my follow-up question on supply chain moves and some of the regionalization of footprint, Jennifer, that you talked about in your opening comments: maybe a little bit more color around what's been done there. I know some of that was kind of tariff avoidance kind of things. So, might be okay regardless of tariffs. Is there incremental profitability that drops through from that that contributes to margin expansion and that maybe offsets some price that maybe you don't take? Or just how you're thinking about your ability to keep that improvement in cost things?
Speaker #12: Then I guess, as a follow-up to my question on supply chain moves and some of the regionalization of footprint, Jennifer, you talked about that in your opening comments. Maybe a little bit more color around what's been done there?
Speaker #12: I know some of that was kind of a tariff avoidance kind of thing, so it might be okay regardless of tariffs. Is there incremental profitability that drops through from that, that contributes to margin expansion, that maybe offsets some price?
Speaker #12: Maybe you don’t take, or just how you’re thinking about, your ability to keep that improvement in cost. Thanks.
Jennifer L. Honeycutt: Yeah. I mean, principally, we initiated regionalization of our manufacturing lines and sort of regionalized our supply chain to certainly deal with the tariff environment that we were facing last year. As a reminder, these are all no-regret moves because we're effectively a light assembly house, right? There's no big capital monuments to replicate or move. And so it's fairly straightforward to kit up these lines and move them within a 6 to 9-month kind of timeframe insofar as what kinds of moves happened. Our Videojet business had a fairly large China manufacturing footprint. We've diversified that footprint into the UK, into Europe. We de-risked our Trojan business in Canada by adding footprint into an existing or expanding footprint in an existing location here in the US. We've had some Hach product lines that have been diversified as well.
Jennifer Honeycutt: Yeah. I mean, principally, we initiated regionalization of our manufacturing lines and sort of regionalized our supply chain to certainly deal with the tariff environment that we were facing last year. As a reminder, these are all no-regret moves because we're effectively a light assembly house, right? There's no big capital monuments to replicate or move. And so it's fairly straightforward to kit up these lines and move them within a 6 to 9-month kind of timeframe insofar as what kinds of moves happened. Our Videojet business had a fairly large China manufacturing footprint. We've diversified that footprint into the UK, into Europe. We de-risked our Trojan business in Canada by adding footprint into an existing or expanding footprint in an existing location here in the US. We've had some Hach product lines that have been diversified as well.
Speaker #4: mean Yeah . I , principally we initiated , you know , regionalization our of manufacturing lines and sort of regionalize our supply chain to certainly deal with the tariff environment that we are facing .
Speaker #4: Last year , as a reminder , these are all no regret moves because we're effectively a light assembly house . Right ? There's no big capital capital monuments to replicate or move .
Speaker #4: so it's it's And fairly straightforward to kit up these lines and move them within , you know , a 6 to 9 month kind of time frame insofar as what kinds of moves happened , you know , our videojet business had a fairly large China manufacturing footprint .
Speaker #4: We’ve diversified that footprint into the U.K., into Europe. You know, de-risked our Trojan business in Canada by adding footprint into an existing, or expanding footprint in an existing HERE location.
Speaker #4: in the US . We've had some , you know , hoc like Hawk product lines that have been as diversified well . So , you know , all told , there were , you know , close to a dozen line moves there to really get us set up for any kind of trade environment that we would be facing going forward .
Jennifer L. Honeycutt: So all told, there were close to a dozen line moves there to really get us set up for any kind of trade environment that we would be facing going forward that would be more restrictive given sort of the geopolitical dynamics. The things that we're working through now here are to make sure that we're not encountering any absorption issues, right? We got to make sure that those new line moves are up and running to full capacity and that we're operating efficiently there. So there's a little bit more work to do there. But again, these are no-regret moves. And to the extent that trade relationships continue to change, we just had one yesterday between the US and India that became favorable for us, right? So we're going to continue to be flexible, nimble, and agile in how we approach the geopolitical tariff trade environment.
Jennifer Honeycutt: So all told, there were close to a dozen line moves there to really get us set up for any kind of trade environment that we would be facing going forward that would be more restrictive given sort of the geopolitical dynamics. The things that we're working through now here are to make sure that we're not encountering any absorption issues, right? We got to make sure that those new line moves are up and running to full capacity and that we're operating efficiently there. So there's a little bit more work to do there. But again, these are no-regret moves. And to the extent that trade relationships continue to change, we just had one yesterday between the US and India that became favorable for us, right? So we're going to continue to be flexible, nimble, and agile in how we approach the geopolitical tariff trade environment.
Speaker #4: That would be more restrictive , you know , given sort of the geopolitical dynamics , you know , the the things that we're working through now here are , are , you know , to make sure that it you know , we're not encountering any absorption issues .
Speaker #4: Right ? We got to make sure that those new line moves are up and running to full capacity . And that we're operating efficiently , efficiently there .
Speaker #4: So there's a little bit more work to do there . But again , these are no regret moves . And to the extent that , you know , trade relationships continue to change , you know , we just had one .
Speaker #4: You know between , yesterday the US and India became where that favorable for us . Right . So we're going to continue to be , you flexible and nimble and agile and how we approach , you know , the geopolitical tariff trade environment .
Jennifer L. Honeycutt: I think VES does a great job of serving us well here.
Jennifer Honeycutt: I think VES does a great job of serving us well here.
[Analyst] (Stifel): Thanks for taking the questions.
Nathan Jones: Thanks for taking the questions.
Speaker #4: And I think Vez does a great job of serving us well here .
Operator: Thank you. We will take our last question from Brad Hewitt with Wolfe Research. Please go ahead. Your line is open.
Operator: Thank you. We will take our last question from Brad Hewitt with Wolfe Research. Please go ahead. Your line is open.
Speaker #12: Thanks for taking the questions .
Speaker #2: Thank you . We will take our last question from Brad Hewitt with Wolfe Research . Please go ahead . Your line is open .
[Analyst] (Wolfe Research): Hey, good morning. Thanks for squeezing me in here.
Brad Hewitt: Hey, good morning. Thanks for squeezing me in here.
Jennifer L. Honeycutt: Hey, Brad.
Jennifer Honeycutt: Hey, Brad.
[Analyst] (Wolfe Research): Just curious in terms of what you're assuming for the price contribution to growth in 2026, both consolidated and by segment, and how much of that is carryover versus incremental pricing?
Brad Hewitt: Just curious in terms of what you're assuming for the price contribution to growth in 2026, both consolidated and by segment, and how much of that is carryover versus incremental pricing?
Speaker #13: Hey . Good morning . Thanks for squeezing me in here .
Speaker #4: Hey , Brad .
Speaker #13: Just curious in terms of what you're assuming for the price contribution to growth in 2026 , both consolidated and by segment . And how much of that is carryover versus incremental pricing ?
Sameer Ralhan: Yeah. Thanks, Brad, for that. Yeah. If you're going to look at the pricing that we have modeled into the guidance in 2026, historical range is 100 to 200 basis points. You should expect us to be towards the high end of the range this year. Part of it is carryover, as you said, from the pricing actions that we initiated. But we are implementing price increases on top of that as well, just as part of the regular cadence. So that will put us closer to 200 basis points range.
Sameer Ralhan: Yeah. Thanks, Brad, for that. Yeah. If you're going to look at the pricing that we have modeled into the guidance in 2026, historical range is 100 to 200 basis points. You should expect us to be towards the high end of the range this year. Part of it is carryover, as you said, from the pricing actions that we initiated. But we are implementing price increases on top of that as well, just as part of the regular cadence. So that will put us closer to 200 basis points range.
Speaker #5: Yeah . Thanks , Brad for that . Yeah . If you kind of look at the pricing that we have modeled into the guidance in 2026 , you know , historical 100 to 200 basis points , you should expect us to be towards the high end of the range this year .
Speaker #5: Part of it is carryover , as you said , from the pricing actions that we initiated . But we are implementing price increases on top of that as well , just as part of the regular cadence .
[Analyst] (Wolfe Research): Okay. Great. And then as we think about organic growth phasing throughout the year, is it fair to assume organic growth accelerates each quarter through the year? And then Q4, given the easy comp, you're kind of comfortably in the mid-single-digit zone? Thank you.
Brad Hewitt: Okay. Great. And then as we think about organic growth phasing throughout the year, is it fair to assume organic growth accelerates each quarter through the year? And then Q4, given the easy comp, you're kind of comfortably in the mid-single-digit zone? Thank you.
Speaker #5: So that will us put closer to 200 range basis points . Range .
Speaker #13: Great . And then Okay . as we think about organic growth phasing throughout the year , is it fair to assume organic growth accelerates each quarter through the year .
Sameer Ralhan: Oh, absolutely, Brad. As you're going to think about this thing, interesting thing is, as you're going to look at the sequential sort of buildup of the revenue throughout the quarters, it's pretty much in line with the historical averages, right? 24% of the total revenue in Q1, that if you look at overall, just because of the three-day impact, the comps will be a little bit of headwind in the first half of the year, but they become favorable in the second half from that three-day math. But otherwise, underlying demand patterns, there are no changes.
Sameer Ralhan: Oh, absolutely, Brad. As you're going to think about this thing, interesting thing is, as you're going to look at the sequential sort of buildup of the revenue throughout the quarters, it's pretty much in line with the historical averages, right? 24% of the total revenue in Q1, that if you look at overall, just because of the three-day impact, the comps will be a little bit of headwind in the first half of the year, but they become favorable in the second half from that three-day math. But otherwise, underlying demand patterns, there are no changes.
Speaker #13: And then Q4 , given the easy comp , you're kind of comfortably in the mid single digit zone . Thank you .
Speaker #5: Well , absolutely , Brad , as you're going to think about this thing , you know , interesting thing is as you're going to look at the sequential sort of build up of the revenue throughout the quarter , as it pretty much in line with the historical right ?
Speaker #5: averages , 24% of the total revenue in Q1 that , you know , if you look at overall , just because of the three day impact , the comps will be a little bit of headwind in the first half of the year .
Speaker #5: But they become favorable second half from that three day in the math . But otherwise underlying demand patterns , there are no changes .
[Analyst] (Wolfe Research): Great. Thank you.
Brad Hewitt: Great. Thank you.
Sameer Ralhan: Thanks, Brad.
Sameer Ralhan: Thanks, Brad.
Ryan Taylor: Thanks, Brad. This is Ryan Taylor. We appreciate everybody joining the call today. We appreciate you sticking with us a little bit past the bottom of the hour here. As usual, I'll be around for follow-up questions over the next days and weeks. Should you have any, just reach out to me. And thanks again for joining our fourth-quarter call.
Ryan Taylor: Thanks, Brad. This is Ryan Taylor. We appreciate everybody joining the call today. We appreciate you sticking with us a little bit past the bottom of the hour here. As usual, I'll be around for follow-up questions over the next days and weeks. Should you have any, just reach out to me. And thanks again for joining our fourth-quarter call.
Speaker #13: Okay . Thank you .
Speaker #5: Brad Thanks , .
Speaker #3: Thanks , Brad , this is Ryan Taylor . We appreciate everybody joining the call today . We appreciate you sticking with us a little bit past the bottom of the hour here .
Speaker #3: As usual, I'll be around for follow-up over the next days and weeks. Should you have any questions, just reach out to me. And thanks again for joining our fourth quarter call.
Operator: Thank you. This brings us to the end of Veralto Corporation's Q4 2025 conference call. We appreciate your time and participation. You may now disconnect.
Operator: Thank you. This brings us to the end of Veralto Corporation's Q4 2025 conference call. We appreciate your time and participation. You may now disconnect.
Speaker #2: Thank you. This brings us to the end of Veralto Corporation's fourth quarter 2025 conference call. We appreciate your time and participation.
