REVVITY INC

Revenue

Revenue for the three months ended June 30, 2024 was $691.7 million, as compared to $709.1 million for the three months ended July 2, 2023, a decrease of $17.4 million, or approximately 2%, which includes a 1% decrease in revenue attributable to unfavorable changes in foreign exchange rates. The analysis in the remainder of this paragraph comp ares segment revenue and includes the effect of foreign exchange rate fluctuations. Life Sciences segment revenue was $313.8 million for the three months ended June 30, 2024, as compared to $336.4 million for the three months ended July 2, 2023, a decrease of $22.5 million, or 7%, driven by a decrease of $15.4 million in reagents revenue and a decrease of $13.8 million in instruments revenue, partially offset by an increase of $6.7 million in software revenue. Diagnostics segment revenue was $378.0 million for the three months ended June 30, 2024, as compared to $372.9 million for the three months ended July 2, 2023, an increase of $5.1 million, or 1%, due to an increase of $12.4 million in immunodiagnostics revenue andan increase of $0.6 million in reproductive health revenue, partially offset bya decrease of $7.8 million in applied genomics revenue.

Revenue for the six months ended June 30, 2024 was $1,341.6 million, as compared to $1,383.9 million for the six months ended July 2, 2023, a decrease of $42.3 million, or approximately 3%, which includes a 1% decrease in revenue attributable to unfavorable changes in foreign exchange rates. The analysis in the remainder of this paragraph compares segment revenue and includes the effect of foreign exchange rate fluctuations. Life Sciences segment revenue was $616.9 million for the six months ended June 30, 2024, as compared to $664.8 million for the six months ended July 2, 2023, a decrease of $47.9 million, or 7%, driven by a decrease of $29.1 million in instruments revenue and a decrease of $28.0 million in reagents revenue, partially offset by an increase of $9.2 million in software revenue. Diagnostics segment revenue was $725.1 million for the six months ended June 30, 2024, as compared to $719.5 million for the six months ended July 2, 2023, an increase of $5.6 million, or 1%, due to an increase of $27.0 million in immunodiagnostics revenue and an increase of $2.3 million in reproductive health revenue, partially offset by a decrease of $23.8 million in applied genomics revenue.

Cost of Revenue

Cost of revenue for the three months ended June 30, 2024 was $306.2 million, as compared to $306.7 million for the three months ended July 2, 2023, a decrease of $0.6 million, or less than 1%. As a percentage of revenue, cost of revenue increased to 44.3% for the three months ended June 30, 2024, from 43.3% for the three months ended July 2, 2023, resulting in a decrease in gross margin of 101 basis points to 55.7% for the three months ended June 30, 2024, from 56.7% for the three months ended July 2, 2023, primarily due to lower sales volume and increased material costs, partially offset by pricing actions, productivity gains and transportation cost initiatives. Rebranding costs were $1.6 million for the three months ended June 30, 2024. Stock compensation expense related to awards given to BioLegend employees post-acquisition added an incremental expense of $0.2 million for the three months ended June 30, 2024, as compared to $0.8 million for the three months ended July 2, 2023. Amortization of intangible assets was $37.3 million for the three months ended June 30, 2024, as compared to $38.9 million for the three months ended July 2, 2023.

Cost of revenue for the six months ended June 30, 2024 was $601.1 million, as compared to $600.2 million for the six months ended July 2, 2023, an increase of $0.8 million, or less than 1%. As a percentage of revenue, cost of revenue increased to 44.8% for the six months ended June 30, 2024, from 43.4% for the six months ended July 2, 2023, resulting in a decrease in gross margin of 143 basis points to 55.2% for the six months ended June 30, 2024, from 56.6% for the six months ended July 2, 2023, primarily due to lower sales volume and increased material costs, partially offset by pricing actions and productivity gains. Rebranding costs were $6.1 million for the six months ended June 30, 2024. Stock compensation expense related to awards given to BioLegend employees post-acquisition added an incremental expense of $0.4 million for the six months ended June 30, 2024, as compared to $1.7 million for the six months ended July 2, 2023. Amortization of intangible assets was $72.7 million for the six months ended June 30, 2024, as compared to $77.3 million for the six months ended July 2, 2023.

Selling, General and Administrative Expenses

Selling, general and administrative expenses for the three months ended June 30, 2024 were $251.7 million, as compared to $267.0 million for the three months ended July 2, 2023, a decrease of $15.4 million, or 6%. As a percentage of revenue, selling, general and administrative expenses decreased and were 36.4% for the three months ended June 30, 2024, as compared to 37.7% for the three months ended July 2, 2023. Amortization of intangible assets decreased and was $53.3 million for the three months ended June 30, 2024, as compared to $53.9 million for the three months ended July 2, 2023. Acquisition and divestiture-related expenses, which primarily consisted of legal and integration costs, and stock compensation expense related to the awards given to BioLegend employees post-acquisition added an incremental expense of $3.3 million for the three months ended June 30, 2024, as compared to $26.6 million for the three months ended July 2, 2023. Purchase accounting adjustments added an incremental expense of $0.2 million for the three months ended June 30, 2024, which primarily consisted of a change in contingent consideration, as compared to $2.5 million for the three months ended July 2, 2023. The above decreases were partially offset by an increase in restructuring and other costs, net, which was $9.8 million for the three months ended June 30, 2024, as compared to $2.0 million for the three months ended July 2, 2023. Significant litigation matters and settlements added an incremental expense of $6.3 million for the three months ended June 30, 2024. Excluding the factors above, the net decrease in selling, general and administrative expenses was the result of cost containment and productivity initiatives.

Selling, general and administrative expenses for the six months ended June 30, 2024 were $512.2 million, as compared to $515.6 million for the six months ended July 2, 2023, a decrease of $3.4 million, or 1%. As a percentage of revenue, selling, general and administrative expenses increased and were 38.2% for the six months ended June 30, 2024, as compared to 37.3% for the six months ended July 2, 2023. Acquisition and divestiture-related expenses, which primarily consisted of legal and integration costs, and stock compensation expense related to the awards given to BioLegend employees post-acquisition, added an incremental expense of $9.4 million for the six months ended June 30, 2024, as compared to $42.4 million for the six months ended July 2, 2023. Costs for significant environmental matters added an incremental expense of $1.1 million for the six months ended July 2, 2023. The above decreases were partially offset by an increase in amortization of intangible assets, which was $109.2 million for the six months ended June 30, 2024, as compared to $107.3 million for the six months ended July 2, 2023. Restructuring and other costs, net, increased and was $22.2 million for the six months ended June 30, 2024, as compared to $5.1 million for the six months ended July 2, 2023. Purchase accounting adjustments added an incremental expense of $6.4 million for the six months ended June 30, 2024, which primarily consisted of a change in contingent consideration, as compared to $1.2 million for the six months ended July 2, 2023. Significant litigation matters and settlements added an incremental expense of $6.3 million for thesix months ended June 30, 2024. Excluding the factors above, the net decrease in selling, general and administrative expenses was the result of cost containment and productivity initiatives.

Research and Development Expenses

Research and development expenses for the three months ended June 30, 2024 were $48.1 million, as compared to $57.3 million for the three months ended July 2, 2023, a decrease of $9.1 million, or 16%. As a percentage of revenue, research and development expenses decreased and were 7.0% for the three months ended June 30, 2024, as compared to 8.1% for the three months ended July 2, 2023. The decrease in research and development expenses was primarily driven by cost containment and productivity initiatives, as well as a decrease in stock compensation expense related to awards given to BioLegend employees post-acquisition, which added an incremental expense of $0.7 million for the three months ended June 30, 2024 as compared to $1.2 million for the three months ended July 2, 2023.

Research and development expenses for the six months ended June 30, 2024 were $98.5 million, as compared to $113.9 million for the six months ended July 2, 2023, a decrease of $15.5 million, or 14%. As a percentage of revenue, research and development expenses decreased and were 7.3% for the six months ended June 30, 2024, as compared to 8.2% for the six months ended July 2, 2023. The decrease in research and development expenses was primarily driven by cost containment and productivity initiatives, as well as a decrease in stock compensation expense related to awards given to BioLegend employees post-acquisition, which added an incremental expense of $1.4 million for the six months ended June 30, 2024 as compared to $2.4 million for the six months ended July 2, 2023.

Interest and Other Expense, Net

Interest and other expense, net, consisted of the following:

The decrease in interest income for the three months ended June 30, 2024, as compared to the three months ended July 2, 2023 was primarily due to a decrease in investments. Interest expense was lower for the three months ended June 30, 2024 as compared to the same period in prior year primarily due to a lower debt balance as a result of the repayment of senior unsecured notes that matured in September 2023.

The increase in interest income for the six months ended June 30, 2024 as compared to the six months ended July 2, 2023 was primarily due to an increase in investments and higher interest rates. Foreign exchange losses and other expense, net, was lower for the six months ended June 30, 2024 as compared to the same period in prior year mainly due to a foreign exchange loss of $23.7 million that was recognized during the six months ended July 2, 2023, related to the cash proceeds from the sale of the Business that were held offshore.

Provision for Income Taxes

The provision for income taxes from continuing operations was $14.1 million for the three months ended June 30, 2024, as compared to $12.9 million for the three months ended July 2, 2023. The provision for income taxes from continuing operations was $19.9 million for the six months ended June 30, 2024, as compared to $17.5 million for the six months ended July 2, 2023.

The effective tax rate from continuing operations was 16.2% and 16.4% for the three and six months ended June 30, 2024, respectively, as compared to 18.1% and 17.4% for the three and six months ended July 2, 2023, respectively. The effective tax rate during the three months ended June 30, 2024 was lower primarily due to return to provision adjustments

in foreign locations pertaining to prior year provision that were recorded in 2024. The effective tax rate duringthe six months ended June 30, 2024 was lower primarily due to return to provision adjustments in foreign locations pertaining to prior year provision that were recorded in 2024. We expect that the effective tax rate on continuing operations, before discrete items, will be approximately 20% during fiscal year 2024.