STERIS, a global provider of infection prevention and sterilisation products and services, has reported a second strong quarter for fiscal year 2026.
The positive results are driven by growth in its healthcare, applied sterilisation technologies and life sciences businesses.
“Our performance exceeded expectations and margins improved nicely, despite several headwinds. As a result, we are increasing our outlook for fiscal 2026,” said Dan Carestio, President and CEO of STERIS.
The quarter ended on September 30, and the report finds that the total revenue for continuing operations rose 10% year-on-year to $1.5bn.
The constant currency organic revenue increased 9%, underscoring the underlying demand. Adjusted earnings per diluted share climbed 15% to $2.47, up from $2.14 a year earlier, driven by higher volumes, pricing gains, and operating leverage.
Areas of growth
- Healthcare: Revenue advanced 9% to $1.03bn. Operating income increased to $259.5m, up from $228.0m last year, reflecting stronger volumes, pricing, and productivity gains.
- Applied Sterilization Technologies (AST): Revenue increased 10% to $281.5m, driven primarily by 13% service growth. Segment operating income improved 16% to $127.6m, supported by pricing and favorable mix, despite a steep decline in capital equipment sales.
- Life Sciences: Revenue rose 13% to $145.0m. Operating income expanded to $59.9m, up from $53.7m a year ago, benefiting from higher volumes and pricing.
Growth in these areas reflects increasing demand for sterilisation capacity and cleanroom-compatible consumables.
STERIS’s performance highlights continued strength in the global infection prevention and cleanroom technology sectors, supported by ongoing investment in sterile processing, life sciences manufacturing and contamination control infrastructure.
Operating cash flow expectations
Operating cash flow for the first half of fiscal 2026 reached $707.8m, with free cash flow up 53% to $527.7m, reflecting stronger earnings and working capital efficiency.
For the full year, STERIS now expects:
- Constant currency organic revenue growth: 7–8% (previously 6–7%)
- Adjusted EPS: $10.15–$10.30 (previously $9.90–$10.15)
- Free cash flow: approximately $850m (previously $820m)
Capital expenditures remain forecast at about $375m for the year.
