Agilent Technologies closed Thursday's session at $167.26, up $5.32 (3.29%). The company presented its results at J.P. Morgan's U.S. All Stars Conference on September 23.
For the fiscal third quarter, Agilent recorded organic revenue growth of 10% to 11% and expanded its operating margin by more than 100 basis points, despite tariff pressures. Pricing contributed roughly 200 basis points to the margin expansion, with an expected annual contribution of 150 to over 200 basis points going forward.
Regionally, China delivered high‑single‑digit growth and the company raised its Q4 guidance for the market to high single‑digit growth, citing a long‑term target of mid‑ to high‑single‑digit expansion in a $250 billion pharma macro market that is projected to double. Asia ex‑China grew 9% in the quarter, with management anticipating double‑digit growth in 2026. Europe posted low‑single‑digit growth in Q3 on a high‑single‑digit comparative basis. In the United States, academic exposure accounts for 3%‑4% of the business, with less than 1% directly tied to NIH contracts.
The Advanced Therapeutics Division, Agilent’s specialty CDMO business, grew 30% in Q3 but is expected to be flat in Q4 after a 40% year‑over‑year comparison. Capacity build‑out of CDMO Train C, scheduled for spring 2027, is already 75% booked and could double revenue to about $300 million once fully ramped; Train D will follow 2‑3 quarters later. The 9500 ICP‑MS product line presents a funnel opportunity exceeding $60 million.
Customer concentration has improved: in 2019 three customers accounted for 80% of demand; today the same three represent less than 50%. Consumables grew at a high‑single‑digit rate, representing roughly 70% of Agilent’s analytical chemistry and genomics (ACG) business under three‑year contracts. Services expanded at a mid‑single‑digit pace. Liquid chromatography recorded double‑digit growth in Q3 with a book‑to‑bill above 1.0 for ten consecutive quarters, while gas chromatography is about a quarter through its replacement cycle and is expected to add roughly 100 basis points to overall growth.
Agilent estimates the reshoring market at $1 billion and aims to capture about one‑third by 2030. Modernizing foreign manufacturing agreements rose from 11 in autumn 2024 to 17 in the third quarter, with five of the top ten pharma companies already booking reshoring orders and 75% of signatories announcing capital spending.
Return on equity stands at 21%, and the company’s long‑range plan targets an additional 50 to over 100 basis points of annual operating‑margin expansion. For fiscal Q4, Agilent projects exit‑rate growth of 5.2% to 6.2%. EPS growth for 2025 is forecast at 10%, following a 3% decline two years earlier.
"In 2019, we had three customers that made up 80% of our demand, and now we have three customers make up less than 50%," CFO Adam Elinoff said. CEO Padraig McDonnell added, "We will not be doing a transformative deal. I had to say it," and described the company's innovation architecture as a laboratory where automation acts as the hands and an AI‑driven layer serves as the brain.
