CHARLES RIVER LABORATORIES INTERNATIONAL, INC.
For the period ended Mar 28, 2026. Filed May 7, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 28, 2026 · Filed May 7, 2026
CRL$337.52+7.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-27; filed 2025-11-05.
0001100682-25-000043
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-28; filed 2026-05-07.
0001100682-26-000038
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 115 previous paragraphs and 89 current paragraphs.
43 unchanged; 28 reworded; 18 added; 38 removed; 6 previous and 0 current paragraphs rearranged.
Tables are not compared: 23 previous and 14 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
Recent Acquisitions
Current report
We make strategic acquisitions designed to expand our portfolio of products and services to support the drug discovery and development continuum. We maintain an acquisition strategy that focuses on augmenting internal growth of existing businesses with complementary acquisitions. Our recent transactions are described below.
Current report
On April 17, 2026, we completed the acquisition of an additional 79% equity interest in PathoQuest SAS (PathoQuest), a France-based biotechnology company that provides viral and microbial safety testing services using next-generation sequencing and bioinformatics to support biopharmaceutical product development and manufacturing, resulting in a 100% controlling interest. The preliminary purchase price for PathoQuest was €51.6 million (or approximately $60.0 million based on current exchange rates), subject to customary closing adjustments. This business will be reported as part of our Manufacturing reportable segment.
Current report
On January 14, 2026, we completed the acquisition of certain assets of K.F. Cambodia Ltd (Cambodian NHP Supplier), a leading supplier of non-human primates (NHPs) located in Cambodia. The preliminary purchase price for the Cambodian NHP Supplier was $507.3 million, consisting of $335.0 million paid at closing and $172.3 million representing the acquisition date fair value of deferred consideration, which is payable upon the satisfaction of certain post-close conditions. This business is reported as part of our DSA reportable segment for NHPs vertically integrated into the DSA supply chain and the RMS reportable segment for those NHPs sold to third party customers.
Current report
Recent Divestitures
Current report
The Company routinely evaluates the strategic fit and fundamental performance of its global businesses, divesting operations that do not meet key business criteria. As part of this ongoing assessment, the Company determined that certain capital could be better deployed in other long-term growth opportunities.
Current report
On February 25, 2026, we signed an agreement to sell certain European Discovery Services businesses (European Discovery Divestiture) to IQVIA Inc. (IQVIA) for $145.0 million in cash, subject to certain customary closing conditions, and future contingent payments up to $10.0 million based on future performance. The proposed transaction is expected to close in the second quarter of fiscal year 2026.
Current report
On May 6, 2026, we completed the sale of our CDMO and Cell solutions businesses (CDMO and Cell Solutions Divestiture) to GI Partners (GI) for future contingent performance-based payments up to $50.0 million, subject to certain customary closing adjustments. Additionally, we may be required to fund up to $45.0 million of future EBITDA losses and capital expenditures of the divested businesses over a four year period. During the three months ended March 28, 2026, we recognized a pre-tax loss of $118.0 million, which represents the excess carrying value over the fair value less cost to sell. The loss is recognized within Other (expense) income within the unaudited condensed consolidated statements of income (loss). We will complete our analysis related to the transaction, including determining the final loss on sale, which will be recognized in the second quarter of fiscal year 2026.
Current report
In March 2026, we completed the sale of certain assets located at our Wilmington, Massachusetts site. The assets consisted of office, laboratory and mixed-use buildings within our RMS segment and unallocated corporate, and was sold to an unrelated third party for cash consideration of $60.1 million, net of costs to sell. In conjunction with the sale, we entered into a long-term operating lease for certain buildings to support RMS and unallocated corporate operations. Upon meeting the criteria for sale leaseback, we derecognized the book value of $21.6 million and recognized a pre-tax gain of approximately $38.5 million. The gain was recognized within our RMS reportable segment and unallocated corporate for $23.2 million and $15.3 million, respectively, and is included in Selling, general and administrative expenses within the unaudited condensed consolidated statements of income (loss).
Current report
Revenue for three months ended March 28, 2026 increased $11.7 million, or 1.2%, to $995.8 million compared to $984.2 million in the corresponding period in 2025, primarily due to an increase in Manufacturing revenue, driven by our Microbial Solutions business, and to a lesser extent DSA revenue; partially offset by a decrease in RMS revenue, due to decreased large and small model product revenue.
Current report
Net loss attributable to Charles River Laboratories International, Inc., common shareholders was $14.8 million in the three months ended March 28, 2026, compared to Net income attributable to Charles River Laboratories International Inc, common shareholders of $25.5 million in the corresponding period of 2025. The decrease of $40.3 million for the three months ended March 28, 2026 was due principally to the loss on assets held for sale related to the CDMO and Cell Solutions Divestiture of $118.0 million, partially offset by the increase in operating income described above, compared to the corresponding period in 2025.
Current report
During the three months ended March 28, 2026, our cash flows from operations were $41.1 million compared with $171.7 million for the same period in 2025. The decrease was primarily related to higher payments of variable compensation, specifically annual incentive based bonuses paid during the first quarter.
Current report
Three Months Ended March 28, 2026 Compared to Three Months Ended March 29, 2025
Current report
RMS operating income increased $6.2 million compared to the corresponding period in 2025. RMS operating income as a percentage of revenue for the three months ended March 28, 2026 was 23.9%, an increase of 340 bps from 20.5% for the corresponding period in 2025. Operating income and operating income as a percentage of revenue increased primarily due to lower site consolidation charges and the gain on sale of certain assets at our Wilmington, Massachusetts site recognized within Selling, general and administrative expenses; partially offset by an increase in asset impairments recognized within Cost of revenue, and the lower revenue described above, compared to the corresponding period in 2025.
Current report
DSA revenue increased $4.3 million primarily due to effect of changes in foreign currency exchange rates, partially offset by lower volume principally driven by previous site consolidation activities.
Current report
During the three months ended March 28, 2026, our cash flows from operations were $41.1 million compared with $171.7 million for the same period in 2025. The decrease was primarily related to higher payments of variable compensation, specifically annual incentive based bonuses paid during the first quarter.
Current report
For the three months ended March 28, 2026, cash used in investing activities was primarily driven by the acquisition of the Cambodian NHP Supplier coupled with capital expenditures partially offset by proceeds from the sale of certain assets at our Wilmington, Massachusetts site.
Current report
The following table presents our net cash provided by financing activities:
Removed paragraphs (38)
Previous report
Strategic Review
Previous report
In November 2025, we announced as part of our Board of Directors’ comprehensive strategic review of our business and growth prospects, that we will focus on strategic initiatives to strengthen our leading scientific portfolio within our core markets through strategic acquisitions, partnerships, and internal investments; divest certain underperforming or non-core assets, which represent approximately 7% of the Company’s estimated 2025 revenue; maximize our financial performance, including by implementing additional initiatives aimed at driving greater operating efficiency, which are expected to generate incremental net cost savings of approximately $70 million annually, which will be fully realized in 2026; and maintain a disciplined approach to capital deployment through regularly evaluating the optimal balance between strategic acquisitions, stock repurchases, debt repayment, and other uses of capital.
Previous report
Recent Government Actions
Previous report
On July 4, 2025, the U.S. enacted the One Big Beautiful Bill Act (“OBBBA”), which includes changes to a broad range of tax reform provisions including accelerated tax depreciation, expensing of research and development, and the U.S. international inclusions. We have analyzed the impacts of the OBBBA and reflected them in the current period. The enactment of the OBBBA did not have a material impact to the tax rate for the three and nine months ended September 27, 2025.
Previous report
In February 2025 the U.S. government announced plans to enact increased tariffs on Canada, China and Mexico, later broadening the increase to various countries within Europe, Africa and Asia. As of the date of this report, a number of new tariffs remain in effect, including tariffs between the U.S., and countries from which we obtain significant supply, such as Vietnam, Mauritius and China. The extent and duration of these tariffs and the resulting impact on macroeconomic conditions and our business are uncertain and may depend on various factors including, but not limited to, negotiations between the U.S. and affected countries, reciprocal or retaliatory actions imposed by other countries, tariff exemptions, negative sentiment toward U.S. companies and products, and the availability of lower cost inputs that may be sourced domestically. While we plan to offset most of the estimated tariffs by passing along these higher costs, we will continue to evaluate the nature and extent of the impacts to our business and our operating results.
Previous report
In April 2025, the U.S. Food and Drug Administration (FDA) announced plans to launch a pilot program to reduce animal testing in preclinical safety studies with scientifically validated cell-based and new approach methodologies (NAMs), such as organ-on-a-chip systems, computational modeling, and advanced in vitro assays. We support the FDA’s announcement as we believe the program aligns with the vision previously outlined in the FDA Modernization Act 2.0 and aims to develop a clearer regulatory pathway to streamline the drug development process and safely advance innovative technologies, including alternatives to the current animal based development process. As a leader in preclinical drug development, this vision is consistent with our long-standing mission to drive greater efficiency in the drug development process, enhance scientific innovation, and promote the responsible use of animals in biomedical research. We are continuously evaluating innovative approaches in drug development and have invested in virtual control groups for safety assessment studies and partnerships utilizing AI technologies to reduce animal use. Further, in April 2024, we launched our own Alternative Methods Advancement Project (AMAP), which is an initiative dedicated to developing alternatives to the use of animal testing within the drug development process. In October 2025, we announced the creation of a cross-functional Scientific Advisory Board to guide our strategic focus on NAMs. We remain committed to continuing to collaborate with regulatory agencies, including the FDA, the biopharmaceutical industry and other stakeholders, to help develop, validate, and implement an efficient process for our clients’ regulatory submissions that support the use of new, non-animal based technologies.
Previous report
On May 16, 2023, we received an inquiry from the Enforcement Division of the U.S. Securities and Exchange Commission (SEC) requesting us to voluntarily provide information, subsequently augmented with a document subpoena and additional inquiries, primarily related to the sourcing of non-human primates and related disclosures, and we are cooperating with the requests. Our Audit Committee has retained counsel to conduct an independent investigation into certain issues raised in the investigations, and that work is ongoing. We are not able to predict what action, if any, might be taken in the future by the SEC. The SEC has not provided us with any specific timeline or indication as to when the investigation will be concluded or resolved. We cannot predict the timing, outcome or possible impact of the investigation, including without limitation any potential fines, penalties or liabilities.
Previous report
Revenue for three months ended September 27, 2025 decreased $4.9 million, or 0.5%, to $1,004.9 million compared to $1,009.8 million in the corresponding period in 2024. Revenue for nine months ended September 27, 2025 decreased $26.3 million, or 0.9%, to $3,021.2 million compared to $3,047.4 million in the corresponding period in 2024. The decreases in revenue for the three and nine months ended September 27, 2025 was primarily attributable to declines in our DSA and Manufacturing businesses, which experienced lower volume driven by continued cautious client spending as a result of the demand environment; partially offset by higher revenue in our RMS business, primarily driven by Noveprim, when compared to the corresponding periods in 2024.
Previous report
For the nine months ended September 27, 2025, our operating income and operating income as a percentage of revenue were $308.6 million and 10.2% respectively, compared to $395.0 million and 13.0% respectively, in the corresponding period of 2024. The decreases in operating income and operating income as a percentage of revenue for the nine months ended September 27, 2025 were primarily driven by the acceleration of amortization expense recognized as a result of a decrease in the remaining useful life of certain CDMO client relationships due to a loss of key customers, increased restructuring activities, including higher asset impairments and site consolidation charges, and higher third-party legal and advisory costs when compared to the corresponding period in 2024.
Previous report
Net income available to Charles River Laboratories International, Inc., common shareholders decreased to $54.4 million in the three months ended September 27, 2025, from $68.7 million in the corresponding period of 2024. Net income available to Charles River Laboratories International, Inc., common shareholders decreased to $132.2 million in the nine months ended September 27, 2025, from $226.0 million in the corresponding period of 2024. The decrease in net income available to common shareholders for the three months ended September 27, 2025 was due principally to higher net losses and impairments on our venture capital and strategic equity investments; partially offset by the increase in operating income described above compared to the corresponding period in 2024. The decrease in net income available to common shareholders for the nine months ended September 27, 2025 was due principally to the decrease in operating income described above coupled with higher net losses and impairments on our venture capital and strategic equity investments compared to the corresponding period in 2024.
Previous report
During the nine months ended September 27, 2025, our cash flows from operations were $590.1 million compared with $575.2 million for the same period in 2024. The increase was primarily driven by lower payments of variable compensation and favorable timing of payments to our suppliers and vendors, partially offset by higher purchases of inventory to support our DSA reportable segment.
Previous report
Three Months Ended September 27, 2025 Compared to the Three Months Ended September 28, 2024
Previous report
RMS revenue increased $15.7 million primarily driven by an increase in large research model product revenue, notably from Noveprim and within China, and the effect of changes in foreign currency exchange rates.
Previous report
RMS operating income increased $7.0 million compared to the corresponding period in 2024. RMS operating income as a percentage of revenue for the three months ended September 27, 2025 was 16.2%, an increase of 230 bps from 13.9% for the corresponding period in 2024. Operating income and operating income as a percentage of revenue increased primarily due to the increase in revenue described above; partially offset by an increase in cost of revenue related to the amortization of an inventory step up and certain biological assets from the Noveprim acquisition compared to the corresponding period in 2024.
Previous report
DSA revenue decreased $14.4 million primarily due to lower volume driven by continued cautious client spending as a result of the current demand environment; partially offset by the effect of changes in foreign currency exchange rates compared to the corresponding period in 2024.
Previous report
DSA operating income decreased $3.3 million during the three months ended September 27, 2025 compared to the corresponding period in 2024. DSA operating income as a percentage of revenue for the three months ended September 27, 2025 was 20.5%, a decrease of 10 bps from 20.6% for the corresponding period in 2024. Operating income and operating income as a percentage of revenue decreased primarily due to the lower revenue described above, partially offset by lower severance costs, compared to the corresponding period in 2024.
Previous report
Manufacturing operating income decreased $0.3 million during the three months ended September 27, 2025 compared to the corresponding period in 2024. Manufacturing operating income as a percentage of revenue for the three months ended September 27, 2025 was 20.9%, an increase of 50 bps from 20.4% for the corresponding period in 2024. Operating income decreased primarily due the lower revenue described above; partially offset by lower amortization related to acquisitions and severance charges compared to the corresponding period in 2024. Operating income as a percentage of revenue increased primarily due to lower severance charges and amortization related to acquisitions compared to the corresponding period in 2024.
Previous report
Other expense, net for the three months ended September 27, 2025 was $22.6 million compared to Other income, net of $2.6 million for the corresponding period in 2024 primarily due to $21.1 million of net losses and impairments on our venture capital and strategic equity investments compared to $2.5 million of net gains in the corresponding period in 2024.
Previous report
Nine Months Ended September 27, 2025 Compared to Nine Months Ended September 28, 2024
Previous report
Revenue and Operating Income
Previous report
RMS
Previous report
RMS operating income increased $13.3 million compared to the corresponding period in 2024. RMS operating income as a percentage of revenue for the nine months ended September 27, 2025 was 17.8%, an increase of 170 bps from 16.1% for the corresponding period in 2024. Operating income and operating income as a percentage of revenue increased primarily due to the higher revenue described above, lower charges related to restructuring activities, including asset impairments and site consolidation charges; partially offset by an increase in cost of revenue related to the amortization of an inventory step up and certain biological assets from the Noveprim acquisition compared to the corresponding period in 2024.
Previous report
DSA
Previous report
DSA revenue decreased $36.6 million primarily due to lower volume driven by continued cautious client spending as a result of the current demand environment, partially offset by the effect of changes in foreign currency exchange rates.
Previous report
Manufacturing
Previous report
Manufacturing revenue decreased $4.4 million primarily due to decreased revenue in our Biologics Solutions business, driven by decreased demand for CDMO and Biologics Testing services; partially offset by an increase in our Microbial Solutions business driven by higher product revenue associated with endotoxin product revenue and identification services revenue and the effect of changes in foreign currency exchange rates.
Previous report
Unallocated Corporate
Previous report
Unallocated corporate costs consist of selling, general and administrative expenses that are not directly related or allocated to the reportable segments. The decrease in unallocated corporate costs of $7.8 million, or 4.0%, compared to the corresponding period in 2024 is primarily due to lower employee compensation and benefits related costs; partially offset by higher third-party legal and advisory costs incurred in connection with execution of a Cooperation Agreement entered into with a shareholder earlier this year. Costs as a percentage of revenue for the nine months ended September 27, 2025 were 6.2%, a decrease of 20 bps from 6.4% for the corresponding period in 2024.
Previous report
Other Income (Expense)
Previous report
Interest income for the nine months ended September 27, 2025 was $3.9 million, a decrease of $2.8 million, or 41.8%, driven primarily from lower interest rates and interest earning asset balances.
Previous report
Interest expense for the nine months ended September 27, 2025 was $83.3 million, a decrease of $14.8 million, or 15.1%, compared to $98.1 million in the corresponding period in 2024 due primarily to lower average debt balances.
Previous report
Income Taxes
Previous report
Income tax expense for the nine months ended September 27, 2025 was $60.5 million, a decrease of $10.4 million compared to $70.9 million for the corresponding period in 2024. Our effective tax rate was 31.1% for the nine months ended September 27, 2025 compared to 22.9% for the corresponding period in 2024. The increase in our effective tax rate in the nine months ended September 27, 2025 compared to the corresponding period in 2024 was primarily attributable to an increase in net U.S. taxation of foreign operations, as well as the current and deferred impact of tax legislation enacted in the third quarter of fiscal 2025 in a foreign jurisdiction.
Previous report
During the nine months ended September 27, 2025, our cash flows from operations were $590.1 million compared with $575.2 million for the same period in 2024. The increase was primarily driven by lower payments of variable compensation and favorable timing of payments to our suppliers and vendors, partially offset by higher purchases of inventory to support our DSA reportable segment.
Previous report
For the nine months ended September 28, 2024, cash used in investing activities was primarily driven by capital expenditures, an immaterial asset acquisition, and net purchases and sales in investments related to certain venture capital and strategic equity investments.
Previous report
•Payment of $21.8 million associated with contingent consideration related to the acquisition of Noveprim
Previous report
•Net proceeds from exercises of employee stock options of $23.1 million
Previous report
•Net dividend payments to noncontrolling interest holders of $14.5 million
Reworded paragraphs (28)
Previous wording
We are continuing to see a cautious spending environment from our client base, principally within our DSA segment related to our global biopharmaceutical and biotechnology clients, as they reassess their budgets, reprioritize their drug pipelines, and manage their cost structures. As we continue to navigate these challenges in the current macroeconomic environment, DSA backlog declined slightly to $1.8 billion as of September 27, 2025 from $2.0 billion as of December 28, 2024.
Current wording
We are continuing to see a cautious spending environment from our client base, principally within our DSA segment as the challenging demand environment experienced in the recent prior quarters has persisted. As we continue to navigate these challenges in the current macroeconomic environment, DSA backlog held consistent at $1.9 billion as of March 28, 2026 and December 27, 2025, respectively.
Previous wording
In response to recent trends observed across each of our businesses in the global market environment, we have undertaken and will continue to implement restructuring actions at various locations across North America, Europe and Asia. This includes workforce right-sizing actions, resulting in severance and transition costs; and costs related to the consolidation of facilities to optimize our global footprint and drive greater operating efficiency across the company, resulting in asset impairments, accelerated depreciation, and other site consolidation charges. During fiscal year 2023, we began taking restructuring actions as a result of these emerging business trends. We incurred restructuring charges of $17.3 million and $73.3 million, during the three and nine months ended September 27, 2025, respectively, and $107.0 million and $29.7 million during fiscal 2024 and fiscal 2023, respectively. We expect that these effectuated actions, as well as other upcoming planned actions designed to optimize our global footprint to drive greater operating efficiency, will result in approximately $225 million of cost savings on an annualized basis, of which approximately $175 million will impact fiscal year 2025.
Current wording
In response to recent trends, we continue to implement cost savings initiatives focused on driving greater efficiencies, as well as restructuring actions that have been implemented over the past three years that were focused on workforce right-sizing and site optimization. More recently, efficiency initiatives have targeted incremental savings through process improvements, procurement synergies, and implementation of a global business services model. Collectively, these actions are expected to generate approximately $300 million in cumulative, annualized cost savings by the end of 2026, of which more than $175 million benefitted fiscal year 2025. Workforce right-sizing actions resulted in severance and transition costs while costs related to the consolidation of facilities to optimize our global footprint and drive greater operating efficiency across the company resulted in asset impairments, accelerated depreciation, and other site consolidation charges. We incurred restructuring charges of $31.6 million during the three months ended March 28, 2026, and $99.8 million and $107.0 million during the fiscal years 2025 and 2024, respectively.
Previous wording
For the three months ended September 27, 2025, our operating income and operating income as a percentage of revenue were $133.8 million and 13.3% respectively, compared to $117.4 million and 11.6% respectively, in the corresponding period of 2024. The increases in operating income and operating income as a percentage of revenue for the three months ended September 27, 2025 were primarily driven by lower severance costs, coupled with lower unallocated corporate employee compensation and benefits related costs when compared to the corresponding period in 2024.
Current wording
For the three months ended March 28, 2026, our operating income and operating income as a percentage of revenue were $119.9 million and 12.0% respectively, compared to $74.7 million and 7.6% respectively, in the corresponding period of 2025. The increases in operating income and operating income as a percentage of revenue for the three months ended March 28, 2026 were primarily driven by the gain on sale of certain assets at our Wilmington, Massachusetts site, the absence of accelerated amortization expense, certain third-party legal costs incurred in fiscal year 2025, and the increase in revenue described above; partially offset by higher acquisition, integration and divestiture costs, when compared to the corresponding period in 2025.
Previous wording
RMS revenue increased $14.7 million primarily driven by increases in large research model product revenue, notably from Noveprim, small model product revenue in Europe and China, GEMS and Insourcing Solutions service revenue, and the effect of changes in foreign currency exchange rates; partially offset by a decrease in Cell Supply product revenue.
Current wording
RMS revenue decreased $4.7 million primarily driven by decreases in large research model product revenue, and small model product revenue in North America, and to a lesser extent Cell Supply product revenue and GEMS service revenue; partially offset by increased revenue for small research models in China and the effect of changes in foreign currency exchange rates.
Previous wording
DSA operating income decreased $39.8 million compared to the corresponding period in 2024. DSA operating income as a percentage of revenue for the nine months ended September 27, 2025 was 18.8%, a decrease of 170 bps from 20.5% for the corresponding period in 2024. Operating income and operating income as a percentage of revenue decreased primarily due to the lower revenue described above, increased restructuring activities, including asset impairments and site consolidation charges, and certain third-party legal costs incurred in connection with the investigations by the U.S. government into the non-human primate supply chain; partially offset by lower severance costs and a decrease in amortization expense, as compared to the corresponding period in 2024.
Current wording
DSA operating income increased $9.9 million compared to the corresponding period in 2025. DSA operating income as a percentage of revenue for the three months ended March 28, 2026 was 17.4%, an increase of 150 bps from 15.9% for the corresponding period in 2025. Operating income and operating income as a percentage of revenue increased primarily due to the absence of certain third-party legal costs in fiscal year 2025 associated with the investigations by the U.S. government into the non-human primate supply chain, lower restructuring activities, including asset impairments recognized within Cost of revenue, as compared to the corresponding period in 2025.
Previous wording
Manufacturing revenue decreased $6.2 million primarily due to decreased revenue in our Biologics Solutions business, driven by decreased demand for CDMO and Biologics Testing services; partially offset by increased revenue in our Microbial Solutions business driven by higher product revenue associated with endotoxin product revenue and identification services revenue and the effect of foreign currency exchange rates.
Current wording
Manufacturing revenue increased $12.1 million primarily due to increased revenue in our Microbial Solutions business driven by higher endotoxin product revenue and the effect of changes in foreign currency exchange rates; partially offset by decreased demand for CDMO services.
Previous wording
Manufacturing operating income decreased $67.7 million compared to the corresponding period in 2024. Manufacturing operating income as a percentage of revenue for the nine months ended September 27, 2025 was 7.6%, a decrease of 1,170 bps from 19.3% for the corresponding period in 2024. Operating income and operating income as a percentage of revenue decreased primarily due to accelerated amortization expense as a result of a decrease in the remaining useful life of certain client relationships due to a loss of key customers within the CDMO business and restructuring activities, including asset impairments and site consolidation charges, and due to the lower revenue described above compared to the corresponding period in 2024.
Current wording
Manufacturing operating income increased $55.5 million compared to the corresponding period in 2025. Manufacturing operating income as a percentage of revenue for the three months ended March 28, 2026 was 24.6%, an increase of 2,940 bps from (4.8)% for the corresponding period in 2025. Operating income and operating income as a percentage of revenue increased primarily due to lower amortization expense within the CDMO business principally due to the absence of accelerated amortization expense as a result of a decrease in the remaining useful life of certain client relationships due to a loss of key customers in fiscal year 2025, and due to the increased revenue described above, compared to the corresponding period in 2025.
Previous wording
Unallocated corporate costs consist of selling, general and administrative expenses that are not directly related or allocated to the reportable segments. The decrease in unallocated corporate costs of $12.9 million, or 16.8%, compared to the corresponding period in 2024 is primarily due to lower employee compensation and benefits related costs. Costs as a percentage of revenue for the three months ended September 27, 2025 was 6.4%, a decrease of 120 bps from 7.6% for the corresponding period in 2024.
Current wording
Unallocated corporate costs consist of selling, general and administrative expenses that are not directly related or allocated to the reportable segments. The increase in unallocated corporate costs of $26.3 million, or 48.5%, compared to the corresponding period in 2025 is primarily due to higher acquisition, integration and divestiture costs primarily associated with our previously discussed activities, increased stock-based compensation expense related to our recently announced transition of executives, higher professional services fees related to enterprise-wide efficiency initiatives; partially offset by the gain on sale of certain assets at our Wilmington, Massachusetts site. Costs as a percentage of revenue for the three months ended March 28, 2026 were 8.1%, an increase of 260 bps from 5.5% for the corresponding period in 2025.
Previous wording
Interest income for the three months ended September 27, 2025 was $1.4 million, a decrease of $0.1 million, or 6.9%, driven primarily from lower interest rates and interest-earning asset balances.
Current wording
Interest income for the three months ended March 28, 2026 was $1.0 million, a decrease of $0.4 million, or 26.4%, driven primarily from lower interest earning asset balances.
Previous wording
Interest expense for the three months ended September 27, 2025 was $25.4 million, a decrease of $4.9 million, or 16.1%, compared to $30.3 million in the corresponding period in 2024 due primarily to lower average debt balances.
Current wording
Interest expense for the three months ended March 28, 2026 was $26.7 million, a decrease of $1.1 million, or 4.1%, compared to $27.9 million in the corresponding period in 2025 due primarily to lower average interest rates on our debt balances within our revolving credit facility.
Previous wording
Other expense, net for the nine months ended September 27, 2025 was $34.7 million compared to Other income, net of $6.2 million for the corresponding period in 2024 due primarily to venture capital investment losses and impairments of $10.3 million as compared to gains of $8.4 million coupled with strategic equity investment losses and impairments of $23.7 million as compared to $9.4 million of net losses and impairments in the corresponding period in 2024.
Current wording
Other expense, net for the three months ended March 28, 2026 was $124.1 million compared to $12.2 million for the corresponding period in 2025 due principally to the loss on assets held for sale of $118.0 million in connection with the CDMO and Cell Solutions Divestiture and venture capital and strategic equity investment losses and impairments of $1.1 million as compared to $10.4 million in 2025.
Previous wording
Income tax expense for the three months ended September 27, 2025 was $31.6 million, an increase of $10.7 million compared to $20.9 million for the corresponding period in 2024. Our effective tax rate was 36.3% for the three months ended September 27, 2025 compared to 23.0% for the corresponding period in 2024. The increase in our effective tax rate in the three months ended September 27, 2025 compared to the corresponding period in 2024 was primarily attributable to an increase in net U.S. taxation of foreign operations, as well as the current and deferred impact of tax legislation enacted in the third quarter of fiscal 2025 in a foreign jurisdiction.
Current wording
Income tax benefit for the three months ended March 28, 2026 was $15.1 million, compared to income tax expense of $10.1 million for the corresponding period in 2025. Our effective tax rate was 50.6% for the three months ended March 28, 2026 compared to 28.1% for the corresponding period in 2025. The difference in our effective tax rate in the three months ended March 28, 2026 compared to the corresponding period in 2025 was primarily attributable to the tax effects of the $118.0 million loss on assets held for sale in connection with the CDMO and Cell Solutions Divestiture, as well accrued interest relating to acquired uncertain tax positions during the three months ended March 28, 2026.
Previous wording
Net cash provided by cash flows from operating activities represents the cash receipts and disbursements related to all of our activities other than investing and financing activities. Operating cash flow is derived by adjusting our net income for (1) non-cash operating items such as depreciation and amortization, stock-based compensation, goodwill impairment, debt financing costs, deferred income taxes, write downs of inventories, provisions of credit losses, long-lived asset impairment changes, gains and/or losses on venture capital and strategic equity investments, gains and/or losses on divestitures, changes in fair value of contingent consideration, as well as (2) changes in operating assets and liabilities, which reflect timing differences between the receipt and payment of cash associated with transactions and when they are recognized in our results of operations.
Current wording
Net cash provided by operating activities represents the cash receipts and disbursements related to all of our activities other than investing and financing activities. Operating cash flow is derived by adjusting our net income for (1) non-cash operating items such as depreciation and amortization, stock-based compensation, goodwill impairment, debt financing costs, deferred income taxes, write downs of inventories, provisions of credit losses, long-lived asset impairment changes, gains and/or losses on venture capital and strategic equity investments, gains and/or losses on divestitures, changes in fair value of contingent consideration, as well as (2) changes in operating assets and liabilities, which reflect timing differences between the receipt and payment of cash associated with transactions and when they are recognized in our results of operations.
Previous wording
For the nine months ended September 27, 2025, cash used in investing activities was primarily driven by capital expenditures partially offset by proceeds from divestitures of certain site and business assets. Capital expenditures decreased for the nine months ended September 27, 2025 as compared to the same period in 2024, as a result of disciplined spend management in light of the global economic environment.
Current wording
For the three months ended March 29, 2025, cash used in investing activities was primarily driven by capital expenditures partially offset by proceeds from divestitures of certain site and business assets.
Previous wording
For the nine months ended September 28, 2024, net cash used in financing activities was primarily driven by the following activity:
Current wording
For the three months ended March 28, 2026, net cash provided by financing activities was primarily driven by the following activity:
Previous wording
•Net repayments of $60.5 million from our Credit Facility
Current wording
•Net proceeds of $557.7 million from our Credit Facility
Previous wording
•Treasury stock purchases of $100.7 million associated with our stock repurchase program and $18.4 million due to the netting of common stock upon vesting of stock-based awards in order to satisfy individual statutory tax withholding requirements
Current wording
•Treasury stock purchases of $200.0 million associated with our stock repurchase program and $8.3 million due to the netting of common stock upon vesting of stock-based awards in order to satisfy individual statutory tax withholding requirements
Previous wording
For the nine months ended September 27, 2025, net cash used in financing activities was primarily driven by the following activity:
Current wording
For the three months ended March 29, 2025, net cash used in financing activities was primarily driven by the following activity:
Previous wording
•Net repayments of $346.2 million from our Credit Facility
Current wording
•Net proceeds of $267.5 million from our Credit Facility
Previous wording
•Treasury stock purchases of $350.0 million associated with our stock repurchase program and $9.9 million due to the netting of common stock upon vesting of stock-based awards in order to satisfy individual statutory tax withholding requirements
Current wording
•Treasury stock purchases of $350.0 million associated with our stock repurchase program and $3.1 million due to the netting of common stock upon vesting of stock-based awards in order to satisfy individual statutory tax withholding requirements
Previous wording
•Payment of $12.0 million for the remaining 10% equity interest in an other redeemable noncontrolling interest
Current wording
•Payment of $19.1 million for the remaining 8% equity interest in an other redeemable noncontrolling interest
Previous wording
Our off-balance sheet commitments related to our outstanding letters of credit as of September 27, 2025 and December 28, 2024 were $22.0 million and $22.4 million, respectively.
Current wording
Our off-balance sheet commitments related to our outstanding letters of credit as of March 28, 2026 and December 27, 2025 were $22.0 million.
Previous wording
While the financial results of our global activities are reported in U.S. dollars, our foreign subsidiaries typically conduct their operations in their respective local currency. The principal functional currencies of our foreign subsidiaries are the Euro, British Pound, Canadian Dollar, Chinese Yuan Renminbi, and Mauritian Rupee. During the nine months ended September 27, 2025, the most significant drivers of foreign currency translation adjustment we recorded as part of Other comprehensive income (loss) were the Euro, British Pound, Canadian Dollar, Hungarian Forint, and Mauritian Rupee.
Current wording
While the financial results of our global activities are reported in U.S. dollars, our foreign subsidiaries typically conduct their operations in their respective local currency. The principal functional currencies of our foreign subsidiaries are the Euro, British Pound, and Canadian Dollar. During the three months ended March 28, 2026, the most significant drivers of foreign currency translation adjustment we recorded as part of Other comprehensive income (loss) were the British Pound, Canadian Dollar, Mauritian Rupee, Euro, Chinese Yuan, and Hungarian Forint.
Previous wording
Fluctuations in the foreign currency exchange rates of the countries in which we do business will affect our financial position, results of operations, and cash flows. As the U.S. dollar strengthens against other currencies, the value of our non-U.S. revenue, expenses, assets, liabilities, and cash flows will generally decline when reported in U.S. dollars. The impact to net income as a result of a U.S. dollar strengthening will be partially mitigated by the value of non-U.S. expenses, which will decline when reported in U.S. dollars. As the U.S. dollar weakens versus other currencies, the value of the non-U.S. revenue, expenses, assets, liabilities, and cash flows will generally increase when reported in U.S. dollars. For the nine months ended September 27, 2025, our revenue would have decreased by $99.8 million, and our operating income would have decreased by $3.9 million, if the U.S. dollar exchange rate had strengthened by 10%, with all other variables held constant.
Current wording
Fluctuations in the foreign currency exchange rates of the countries in which we do business will affect our financial position, results of operations, and cash flows. As the U.S. dollar strengthens against other currencies, the value of our non-U.S. revenue, expenses, assets, liabilities, and cash flows will generally decline when reported in U.S. dollars. The impact to net income (loss) as a result of a U.S. dollar strengthening will be partially mitigated by the value of non-U.S. expenses, which will decline when reported in U.S. dollars. As the U.S. dollar weakens versus other currencies, the value of the non-U.S. revenue, expenses, assets, liabilities, and cash flows will generally increase when reported in U.S. dollars. For the three months ended March 28, 2026, our revenue would have decreased by $45.2 million, and our operating income would have decreased by $12.0 million, if the U.S. dollar exchange rate had strengthened by 10%, with all other variables held constant.
Previous wording
During the nine months ended September 27, 2025, we repurchased 2.1 million shares of common stock for $350.0 million under the stock repurchase program. As of September 27, 2025, we had $549.3 million remaining on the authorized $1.0 billion stock repurchase program. On October 29, 2025, our Board of Directors approved a new stock repurchase authorization of $1.0 billion. This new authorization replaces the prior stock repurchase authorization of $1.0 billion that had $549.3 million remaining on the plan when it was terminated.
Current wording
On October 29, 2025, our Board of Directors approved a stock repurchase program of $1.0 billion. During the three months ended March 28, 2026, we repurchased 1.1 million shares of common stock for $200.0 million under the stock repurchase program. As of March 28, 2026, we had $800.0 million remaining on the authorized $1.0 billion stock repurchase program.
Previous wording
Additionally, our stock-based compensation plans permit the netting of common stock upon vesting of restricted stock, restricted stock units, and performance share units in order to satisfy individual statutory tax withholding requirements. During the nine months ended September 27, 2025, we acquired 0.1 million shares for $9.9 million through such netting.
Current wording
Additionally, our stock-based compensation plans permit the netting of common stock upon vesting of restricted stock, restricted stock units, and performance share units in order to satisfy individual statutory tax withholding requirements. During the three months ended March 28, 2026, we acquired less than 0.1 million shares for $8.3 million through such netting.
Previous wording
We believe that the application of our accounting policies, each of which require significant judgments and estimates on the part of management, are the most critical to aid in fully understanding and evaluating our reported financial results. Our significant accounting policies are more fully described in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for fiscal year 2024 as filed with the SEC on February 19, 2025. There have been no changes in the Company’s critical accounting policies during the nine months ended September 27, 2025.
Current wording
We believe that the application of our accounting policies, each of which require significant judgments and estimates on the part of management, are the most critical to aid in fully understanding and evaluating our reported financial results. Our significant accounting policies are more fully described in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for fiscal year 2025 as filed with the SEC on February 18, 2026. There have been no changes in the Company’s critical accounting policies during the three months ended March 28, 2026.
Previous wording
For a discussion of recent accounting pronouncements please refer to Note 1, “Basis of Presentation,” in this Quarterly Report on Form 10-Q. Other than as discussed in Note 1, “Basis of Presentation,” we did not adopt any other new accounting pronouncements during the nine months ended September 27, 2025 that had a significant effect on our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.
Current wording
For a discussion of recent accounting pronouncements please refer to Note 1, “Basis of Presentation,” in this Quarterly Report on Form 10-Q. Other than as discussed in Note 1, “Basis of Presentation,” we did not adopt any other new accounting pronouncements during the three months ended March 28, 2026 that had a significant effect on our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.
Rearranged previous paragraphs (6)
Previous report — wording carried elsewhere
U.S. Government Investigations into the Non-Human Primate Supply Chain
Previous report — wording carried elsewhere
The following tables present consolidated revenue by type and by reportable segment:
Previous report — wording carried elsewhere
The following table presents operating income by reportable segment:
Previous report — wording carried elsewhere
The following presents and discusses our consolidated financial results by each of our reportable segments:
Previous report — wording carried elsewhere
The following table presents our net cash used in financing activities:
Previous report — wording carried elsewhere
•Payment of $19.1 million for the remaining 8% equity interest in Vital River