Revvity, Inc.
Analysis
Revvity is selling its shrinking China diagnostics business and growing double digits in reproductive health, while orders from customers building AI drug-discovery labs start to arrive. Whether that demand turns into shipped sales is what the story now hangs on. How have the diagnostics and life sciences halves diverged since 2024?
- Revvity is selling the China diagnostics business that held it back.
Management agreed in Q2 FY2026 to sell its immunodiagnostics business in China, 6% of revenue and shrinking under reimbursement rules. Growth and margins both step up without it, but the deal does not close until the end of 2027. How much do margins improve once China is sold?
- Demand is coming back, and some of it is from new buyers.
Pharma and biotech orders rose for a third straight quarter, with a 'progressively larger' share tied to AI data generation. The quarter ended with its biggest instrument backlog, so the outlook was raised.
- Growth is riding on one half of the company right now.
Diagnostics grew 11% in Q2 FY2026 while life sciences fell about 3%, because software dropped a fifth on contract timing. The forecast assumes end markets hold, so life sciences still has to recover in real sales. How has diagnostics growth compared with life sciences?
- Diagnostics growth outpaces the companyDiagnostics, led by newborn screening and reproductive health, is growing faster than the rest of the company even where birth rates are flat or falling.
- Pharma and biotech order recoveryOrders from pharma and biotech customers have improved for three quarters, and management expects AI lab build-outs to add demand for screening instruments and reagents.
- China diagnostics divestitureSelling the China immunodiagnostics business removes a low-growth, low-margin operation and leaves a company with a cleaner growth and margin profile.
- Slow underlying revenue growthOrganic growth has been close to flat for years and each expected pickup has slipped, so the improved guidance still depends on customers loosening their budgets.
- Software revenue is lumpySoftware revenue swings with contract renewal timing and can fall by double digits in a quarter, so its reported growth says little about underlying demand.
- One-time tariff refundsPart of the latest earnings beat came from one-time tariff refunds, so the quarter's profit rate overstates what the business earns on an ongoing basis.
| Politician | Transaction | Amount | Traded | Filed |
|---|---|---|---|---|
Donald Trump Republican · Executive | Purchase | ≥$50K | Mar 18 | May 13 |
Gilbert Ray Cisneros, Jr. Democratic · House · CA-31 | Sale | ≥$1K | Sep 3 | Oct 12 |
Gilbert Ray Cisneros, Jr. Democratic · House · CA-31 | Sale | ≥$1K | Sep 4 | Oct 12 |
Gilbert Ray Cisneros, Jr. Democratic · House · CA-31 | Sale | ≥$15K | Sep 9 | Oct 12 |
Ro Khanna Democratic · House · CA-17 | Purchase | ≥$1K | Jun 30 | Jul 6 |
Congressional trading data provided by QuiverQuant
How Revvity turned $2.9B of revenue into $356.6M of operating income.
| Revenue | ||
|---|---|---|
| Life Sciences | $1.4B | ▲ 14.11% YoY |
| Diagnostics | $1.4B | ▼ 5.06% YoY |
| Total revenue | $2.9B | |
| Gross profit | $1.6B | 54.8% |
| Operating income | $356.6M | 12.5% |