STERIS plc
For the period ended Jun 30, 2025. Filed Aug 7, 2025.
View on SEC.govAbout this filing
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.
Jun 30, 2025 · Filed Aug 7, 2025
STE$252.30-0.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-12-31; filed 2025-02-07.
0001757898-25-000002
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-07.
0001757898-25-000008
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 163 previous paragraphs and 155 current paragraphs.
72 unchanged; 72 reworded; 8 added; 18 removed; 1 previous and 3 current paragraphs rearranged.
Tables are not compared: 19 previous and 13 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 (8)
Current report
U.S. Tax Reform. On July 4, 2025, the U.S. enacted the One Big Beautiful Bill Act ("OBBBA") which contains substantial changes to its tax policies. Business provisions in the OBBBA, some of which were extensions of those established in the Tax Cuts and Jobs Act, include favorable cost recovery allowances, changes to U.S. international tax rules, and changes to energy and environmental related incentives. The law has multiple effective dates, with certain provisions applicable to years beginning after fiscal 2026. We are currently assessing its impact on our consolidated financial statements.
Current report
Highlights. Revenues increased 8.7% to $1,391.1 million for the three months ended June 30, 2025, as compared to $1,279.5 million for the same period in the prior year. The increase reflects the benefits of higher volume and pricing, with all three segments contributing to growth.
Current report
Revenues increased 8.7% to $1,391.1 million for the three months ended June 30, 2025, as compared to $1,279.5 million for the same period in the prior year. The increase reflects the benefits of higher volume and pricing, with all three segments contributing to growth.
Current report
Ireland revenues increased 1.4% to $22.5 million for the three months ended June 30, 2025, as compared to $22.2 million for the same period in the prior year, reflecting growth in service revenues, which was partially offset by a decline in consumable and capital equipment revenues.
Current report
Interest and miscellaneous income increased $0.5 million during the first three months of fiscal 2026 when compared to the same prior year period.
Current report
AST revenues increased 12.6% to $281.2 million for the three months ended June 30, 2025, as compared to $249.8 million for the same prior year period. The constant currency organic growth of 10.2% is primarily due to increased pricing and volume, each impacting revenues by a mid-single digit percentage.
Current report
Life Sciences revenues increased 5.2% to $135.2 million for the three months ended June 30, 2025, as compared to $128.5 million for the same prior year period. This increase reflects growth in consumable, service, and capital equipment revenues of 7.8%, 3.3%, and 0.5%, respectively. The constant currency organic growth of 4.2% is primarily due to increased volume and pricing, each impacting revenues by a low-single digit percentage.
Current report
The AST segment's operating income increased 16.1% to $136.7 million for the three months ended June 30, 2025, as compared to $117.7 million during the same prior year period. The segment's operating margins were 48.6% and 47.1% for the first three months of fiscal 2026 and 2025, respectively. The increase in operating income and margin for the three month period ended June 30, 2025 is primarily due to increased pricing and volume which were partially offset by increased energy and labor inflation costs.
Removed paragraphs (18)
Previous report
On August 2, 2023, we purchased the surgical instrumentation, laparoscopic instrumentation and sterilization container assets from Becton, Dickinson and Company (NYSE: BDX) ("BD"). The acquired assets from BD were integrated into our Healthcare segment.
Previous report
The purchase price of the BD acquisition was $539.8 million. The acquisition also qualified for a tax benefit related to tax deductible goodwill, with a present value of approximately$60.0 million. The purchase price of the acquisition was financed with borrowings from our Previous Revolving Credit Facility. For more information, refer to Note 7 titled, "Debt."
Previous report
Highlights. Revenues increased 5.6% to $1,370.6 million for the three months ended December 31, 2024, as compared to $1,297.7 million for the same period in the prior year. Revenues increased 7.0% to $3,979.0 million for the nine months ended December 31, 2024, as compared to $3,719.3 million for the same period in the prior year. The increases reflect higher volume and pricing.
Previous report
Revenues increased 5.6% to $1,370.6 million for the three months ended December 31, 2024, as compared to $1,297.7 million for the same period in the prior year. The increase reflects organic growth in the Healthcare and AST segments, due to the benefits of higher volume and pricing.
Previous report
Ireland revenues increased 23.0% to $24.1 million for the three months ended December 31, 2024, as compared to $19.6 million for the same period in the prior year, reflecting growth in capital equipment, service, and consumable revenues.
Previous report
Revenues increased 7.0% to $3,979.0 million for the nine months ended December 31, 2024, as compared to $3,719.3 million for the same period in the prior year. The increase reflects the benefits of higher volume, primarily in our Healthcare segment due to organic growth as well as the added volume from the acquisition of assets from BD, and pricing.
Previous report
Service revenues increased 9.6% for the nine months ended December 31, 2024, as compared to the same period in the prior year, reflecting growth in the Healthcare and AST segments, which was partially offset by a decline in the Life Sciences segment, due to the divestiture of the CECS business. Consumable revenues increased by 14.3% for the nine months ended December 31, 2024, as compared to the same period in the prior year, reflecting growth in the Healthcare and Life Sciences segments. Capital equipment revenues decreased 7.3% for the nine months ended December 31, 2024, as compared to the same period in the prior year, reflecting declines in the Healthcare and Life Sciences segments.
Previous report
Ireland revenues increased 15.1% to $69.1 million for the nine months ended December 31, 2024, as compared to $60.0 million for the same period in the prior year, reflecting growth in consumable, service, and capital equipment revenues.
Previous report
United States revenues increased 7.9% to $2,929.0 million for the nine months ended December 31, 2024, as compared to $2,715.4 million for the same period in the prior year, reflecting growth in consumable and service revenues, partially offset by a decline in capital equipment revenues.
Previous report
Revenues from other foreign locations increased 3.9% to $980.9 million for the nine months ended December 31, 2024, as compared to $943.9 million for the same period in the prior year. The increase reflects growth within the EMEA, Latin America, and Asia Pacific regions, which was partially offset by declines in Canada.
Previous report
Gross profit percentage for thethird quarter of fiscal 2025 was 44.5% compared to the gross profit percentage for thethird quarter of fiscal 2024 of 43.2%. Favorable impacts from pricing (130 basis points), mix (80 basis points), productivity (70 basis points), divestitures (20 basis points), and acquisitions (10 basis points), were partially offset by unfavorable impacts from labor and overhead costs (140 basis points), adjustments and other charges (30 basis points), and material costs (10 basis points).
Previous report
Interest and miscellaneous income increased $0.4 million and $0.2 million during the third quarter and first nine months of fiscal 2025, respectively.
Previous report
Healthcare revenues increased 6.5% to $976.0 million for the three months ended December 31, 2024, as compared to $916.2 million for the same prior year period. This increase reflects growth in service and consumable revenues of 13.5% and 8.7%, respectively, which was partially offset by a decline in capital equipment revenues of 4.5%. The constant currency organic growth of 6.5% is primarily due to increased volume, impacting revenues by a mid-single digit percentage, as well as increased pricing. Healthcare revenues increased 8.3% to $2,821.5 million for the nine months ended December 31, 2024, as compared to $2,605.2 million for the same prior year period. This increase reflects growth in both service and consumable revenues of 13.9%, which was partially offset by a decline in capital equipment revenues of 5.4%. The constant currency organic growth of 6.3% is primarily due to increased volume, impacting revenues by a mid-single digit percentage, as well as increased pricing.
Previous report
Life Sciences revenues decreased 6.9% to $136.4 million for the three months ended December 31, 2024, as compared to $146.6 million for the same prior year period. This decrease is partially due to the sale of the CECS business, which more than offset other services growth, resulting in a decline of 12.0% in service revenues. This decrease also reflects declines in capital equipment revenues of 30.7%, which was partially offset by growth in consumable revenues of 14.3%. The constant currency organic loss of 1.5% is primarily due to decreased volume, impacting revenues by a low single digit percentage. Life Sciences revenues decreased 4.4% to $392.8 million for the nine months ended December 31, 2024, as compared to $411.1 million for the same prior year period. This decrease is partially due to the sale of the CECS business, which more than offset other services growth, resulting in a decline of 14.3% in service revenues. This decrease also reflects declines in capital equipment revenues of 27.6% which was partially offset by growth in consumable revenues of 16.2%. The constant currency organic growth of 1.8% is primarily due to increased pricing, impacting revenues by a low single digit percentage.
Previous report
The AST segment's operating income increased 10.1% to $115.8 million for the three months ended December 31, 2024, as compared to $105.2 million during the same prior year period. The segment's operating margins were 44.8% for each of the third quarters of fiscal 2025 and 2024. The increase in operating income for the three month period ended December 31, 2024 was primarily due to increased pricing and volume which was partially offset by increased labor and energy costs. Operating margin was favorably impacted by pricing and volume for the three month period ended December 31, 2024 which was offset by increased labor and energy costs. The AST segment's operating income increased 5.5% to $343.4 million for the nine months ended December 31, 2024, as compared to $325.5 million during the same prior year period. The segment's operating margins were 44.9% and 46.3% for the first nine months of fiscal 2025 and 2024, respectively. The increase in operating income for the nine month period ended December 31, 2024 was primarily due to increased pricing, which was partially offset by unfavorable productivity and increased labor and energy costs. The decrease in operating margin for the nine month period ended December 31, 2024 was primarily due to unfavorable productivity and increased labor and energy costs.
Previous report
•Proceeds from the sale of property, plant, and equipment - During the first nine months of fiscal 2024, we received proceeds from the sale of property, plant, and equipment of $7.4 million. The fiscal 2024 proceeds were primarily from the sale of a facility previously used by the AST segment.
Previous report
•Deferred financing fees and debt issuance costs– During the first nine months of fiscal 2025 we paid $2.3 million for financing fees and debt issuance costs primarily related to our Revolving Credit Facility. For more information on our debt, refer to Note 7 to our consolidated financial statements titled, "Debt" and to our Annual Report on Form 10-K for the year ended March 31, 2024, which was filed with the SEC on May 29, 2024.
Previous report
•Acquisition related deferred or contingent consideration – During the first nine months of fiscal 2025 and 2024, we paid $0.3 million and $6.2 million in deferred and contingent consideration, respectively. The fiscal 2024 payment primarily related to the payout of contingent considerations from a prior acquisition totaling $5.0 million.
Reworded paragraphs (72)
Previous wording
In Management’s Discussion and Analysis of Financial Condition and Results of Operations (the “MD&A”), we explain the general financial condition and the results of operations for STERIS including:
Current wording
In Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”), we explain the general financial condition and the results of operations for STERIS and its subsidiaries including:
Previous wording
•where cash will come from to fund future debt principal repayments, growth outside of core operations, repurchases of shares, cash dividends and future working capital needs.
Current wording
•where cash is expected to come from to fund future debt principal repayments, growth outside of core operations, repurchases of shares, cash dividends and future working capital needs.
Previous wording
As you read the MD&A, it may be helpful to refer to information in our consolidated financial statements contained herein, which present the results of our operations for the third quarter and first nine months of fiscal 2025 and fiscal 2024. It may also be helpful to refer to our Annual Report on Form 10-K for the year ended March 31, 2024, which was filed with the Securities and Exchange Commission ("SEC") on May 29, 2024, including information in Item 1, "Business," Part I, Item 1A, "Risk Factors," and Note 12 to our consolidated financial statements titled, "Commitments and Contingencies," and Part II, Item 1A, "Risk Factors" of this Quarterly Report, for a discussion of some of the matters that can adversely affect our business and results of operations.
Current wording
As you read the MD&A, it may be helpful to refer to information in our consolidated financial statements contained herein, which present the results of our operations for the first three months of fiscal 2026 and fiscal 2025. It may also be helpful to refer to our Annual Report on Form 10-K for the year ended March 31, 2025, which was filed with the Securities and Exchange Commission ("SEC") on May 29, 2025, including information in Item 1, "Business," Part I, Item 1A, "Risk Factors," and Note 12 to our consolidated financial statements titled, "Commitments and Contingencies," and Part II, Item 1A, "Risk Factors" of this Quarterly Report, for a discussion of some of the matters that can adversely affect our business and results of operations.
Previous wording
•Capital Equipment Revenues – We define capital equipment revenues as revenues generated from sales of capital equipment, which includes steam and gas sterilizers, low temperature liquid chemical sterilant processing systems, pure steam/water systems, surgical lights and tables, and integrated operating rooms ("OR").
Current wording
•Capital Equipment Revenues – We define capital equipment revenues as revenues generated from sales of capital equipment, which includes steam and gas sterilizers, low temperature liquid chemical sterilant processing systems, automated endoscope reprocessors, pure steam/water systems, surgical lights and tables, and integrated operating rooms ("OR").
Previous wording
•Consumable Revenues– We define consumable revenues as revenues generated from sales of the consumable family of products, which includes dedicated consumables used in our V-PRO sterilizers and automated endoscope reprocessors, SYSTEM 1 and 1E consumables, gastrointestinal endoscopy accessories, instruments and tools, sterility assurance products, barrier protection solutions, and cleaning consumables.
Current wording
•Consumable Revenues– We define consumable revenues as revenues generated from sales of the consumable family of products, which includes dedicated consumables used in our capital equipment, gastrointestinal endoscopy accessories, instruments and tools, sterility assurance products, barrier protection solutions, and cleaning consumables.
Previous wording
Acquisitions and Divestitures. During the first nine months of fiscal 2025, we completed several tuck-in acquisitions which continued to expand our product and service offerings in the Healthcare and AST segments. Total aggregate consideration was approximately$53.7 million.
Current wording
During the first three months of fiscal 2025, we completed several tuck-in acquisitions, which continued to expand our product and service offerings in the Healthcare and AST segments. Total aggregate consideration was approximately$13.7 million.
Previous wording
Acquisition and integration expenses totaled$3.8 million and$9.2 million for the three and nine months ended December 31, 2024, respectively. Acquisition and integration expenses totaled$6.3 million and$24.3 million for the three and nine months ended December 31, 2023, respectively. The decrease in acquisition and integration expenses for the three and nine months ended December 31, 2024 is primarily due to charges related to the acquisition of assets from BD and a fair value adjustment related to a building held for sale from a previous acquisition during fiscal 2024. Acquisition and integration expenses are reported in the Selling, general and administrative expenses line of our Consolidated Statements of Income and include, but are not limited to, investment banker, advisory, legal and other professional fees, and certain employee-related expenses.
Current wording
Acquisition and integration expenses totaled$0.5 million and$2.3 million for the three months ended June 30, 2025 and 2024, respectively. Acquisition and integration expenses are reported in the Selling, general and administrative expenses line of our Consolidated Statements of Income and include, but are not limited to, investment banker, advisory, legal and other professional fees, and certain employee-related expenses.
Previous wording
On April 1, 2024, we completed the sale of the Controlled Environment Certification Services ("CECS") business. We recorded net proceeds of$41.9 million and recognized a pre-tax gain on the sale of$19.3 million in fiscal 2025. The business generated approximately$35.0 million in revenues in fiscal 2024.
Current wording
On April 1, 2024, we completed the sale of the Controlled Environment Certification Services ("CECS") business. We recorded net proceeds of$41.5 million and recognized a pre-tax gain on the sale of$18.8 millionin the first three months of fiscal 2025.
Previous wording
Discontinued Operations. On April 11, 2024, the Company announced its plan to sell substantially all of the net assets of its Dental segment for total cash consideration of$787.5 million, subject to customary adjustments, and up to an additional$12.5 million in contingent payment should the Dental business achieve certain revenue targets in fiscal 2025. The transaction was structured as an equity sale and closed on May 31, 2024. A component of an entity is reported in discontinued operations after meeting the criteria for held for sale classification if the disposition represents a strategic shift that has (or will have) a major effect on the entity's operations and financial results. We analyzed the quantitative and qualitative factors relevant to the divestiture of our Dental segment and determined that those conditions for discontinued operations presentation had been met prior to March 31, 2024. The Dental segment results of operations were reclassified to income (loss) from discontinued operations in the Consolidated Statements of Income for all periods presented, and we classified the Dental segment's assets and liabilities as held for sale as of March 31, 2024 in the accompanying Consolidated Balance Sheets. Due to the transaction closing in the first quarter of fiscal 2025, the held for sale assets and liabilities were classified as current as of March 31, 2024. Our Consolidated Statements of Cash Flows include the financial results of the Dental segment through the date of sale on May 31, 2024. A majority of the proceeds received from the sale were utilized to pay off existing debt.
Current wording
Discontinued Operations. On April 11, 2024, the Company announced its plan to sell substantially all of the net assets of its Dental segment for total cash consideration of$787.5 million, subject to customary adjustments, and up to an additional$12.5 million in contingent payment should the Dental business achieve certain revenue targets in fiscal 2025. The transaction was structured as an equity sale and closed on May 31, 2024. A component of an entity is reported in discontinued operations after meeting the criteria for held for sale classification if the disposition represents a strategic shift that has (or will have) a major effect on the entity's operations and financial results. We analyzed the quantitative and qualitative factors relevant to the divestiture of our Dental segment and determined that those conditions for discontinued operations presentation had been met prior to March 31, 2024. The Dental segment results of operations have been reclassified as income (loss) from discontinued operations in the Consolidated Statements of Income for all periods presented. Our Consolidated Statements of Cash Flows include the financial results of the Dental segment through the date of sale on May 31, 2024. A majority of the proceeds received from the sale were utilized to pay off existing debt.
Previous wording
Gross profit percentage for the third quarter of fiscal 2025 was 44.5% compared to the gross profit percentage for the third quarter of fiscal 2024 of 43.2%. The increase in gross profit percentage for the three month period reflects favorable impacts from pricing, mix, and productivity that were partially offset by unfavorable impacts from labor and overhead costs. Gross profit percentage for the first nine months of fiscal 2025 was 44.3% compared to the gross profit percentage for the first nine months of fiscal 2024 of 44.0%. The increase in gross profit percentage for the nine month period reflects favorable impacts from pricing, mix, and material costs that were partially offset by unfavorable impacts from labor and overhead costs.
Current wording
Gross profit percentage for the first three months of fiscal 2026 was 45.1% compared to the gross profit percentage for the first three months of fiscal 2025 of 44.7%. The increase in gross profit percentage for the three month period reflects favorable impacts from pricing, productivity, and other cost reductions that were partially offset by unfavorable impacts from inflation, tariff costs, mix, and material costs.
Previous wording
Income from operations for the third quarter of fiscal 2025 was $245.3 million, compared to income from operations of $226.5 million for the third quarter of fiscal 2024. Income from operations for the first nine months of fiscal 2025 was $650.5 million, compared to income from operations of $615.8 million for the first nine months of fiscal 2024. The increase in income from operations for the three and nine month periods is primarily due to increased volume and pricing, which was partially offset by increased labor costs and higher restructuring expenses.
Current wording
Income from operations for the first three months of fiscal 2026 was $246.0 million, compared to income from operations of $185.5 million for the first three months of fiscal 2025. The increase in income from operations for the three month period is primarily due to increased volume and pricing and lower restructuring expenses, which was partially offset by increased labor costs.
Previous wording
Cash flows from operations were $887.3 million and free cash flow was $588.1 million for the first nine months of fiscal 2025 compared to cash flows from operations of $718.5 million and free cash flow of $457.0 million for the first nine months of fiscal 2024 (see the subsection below titled "Non-GAAP Financial Measures" for additional information and related reconciliation of cash flows from operations to free cash flow). The fiscal 2025 increase in cash flows from operations and free cash flow resulted from the increase in cash provided by working capital, primarily driven by higher collections on accounts receivable and improved inventory management when compared to the same prior year period.
Current wording
Cash flows from operations were $420.0 million and free cash flow was $326.5 million for the first three months of fiscal 2026 compared to cash flows from operations of $303.7 million and free cash flow of $195.7 million for the first three months of fiscal 2025 (see the subsection below titled "Non-GAAP Financial Measures" for additional information and related reconciliation of cash flows from operations to free cash flow). The fiscal 2026 increase in cash flows from operations and free cash flow resulted from an increase in earnings and from the increase in cash provided by working capital, primarily driven by a higher accounts payable balance due to timing of disbursements when compared to the same prior year period. Free cash flow was also impacted by a decrease in capital expenditures when compared to the same prior year period.
Previous wording
Our debt-to-total capital ratio was 25.2% at December 31, 2024 and 33.7% at March 31, 2024. During the first nine months of fiscal 2025, we declared and paid cash dividends totaling $1.66 per ordinary share.
Current wording
Our debt-to-total capital ratio was 21.5% at June 30, 2025 and 23.6% at March 31, 2025. During the first three months of fiscal 2026, we declared and paid cash dividends totaling $0.57 per ordinary share.
Previous wording
Additional information regarding our financial performance during the third quarter of fiscal 2025 is included in the subsection below titled “Results of Operations.”
Current wording
Additional information regarding our financial performance during the first quarter of fiscal 2026 is included in the subsection below titled “Results of Operations.”
Previous wording
Organic revenue growth and constant currency organic revenue growth are non-GAAP financial measures of revenue performance. Organic revenue growth is calculated by removing the impact of acquisitions and divestitures for one year following the respective transaction from the GAAP revenue growth. Constant currency organic revenue growth is subject to a further adjustment to eliminate the impact of foreign currency movements.
Current wording
Organic revenue growth and constant currency organic revenue growth are non-GAAP financial measures of revenue performance. Organic revenue growth is calculated by removing the impact of acquisitions and divestitures for one year following the respective transaction from the GAAP revenue growth. Constant currency organic revenue growth is subject to a further adjustment to eliminate the impact of foreign currency movements. See the section below "Business Segment Results of Operations" for a reconciliation of organic revenue growth and constant currency organic revenue growth to U.S. GAAP revenue.
Previous wording
The following table summarizes the calculation of our free cash flow for the nine months ended December 31, 2024 and 2023:
Current wording
The following table summarizes the calculation of our free cash flow for the three months ended June 30, 2025 and 2024:
Previous wording
In the following subsections, we discuss our earnings and the factors affecting earnings for the third quarter and first nine months of fiscal 2025 compared to the same fiscal 2024 periods. We begin with a general overview of our operating results and then separately discuss earnings for our operating segments.
Current wording
In the following subsections, we discuss our earnings and the factors affecting earnings for the first three months of fiscal 2026 compared to the same fiscal 2025 periods. We begin with a general overview of our operating results and then separately discuss earnings for our operating segments.
Previous wording
Revenues. The following tables compare our revenues for the three and nine months ended December 31, 2024 to the revenues for the three and nine months ended December 31, 2023:
Current wording
Revenues. The following table compares our revenues for the three months ended June 30, 2025 to the revenues for the three months ended June 30, 2024:
Previous wording
Service revenues increased 10.4% for the three months ended December 31, 2024, as compared to the same period in the prior year, reflecting growth in the Healthcare and AST segments, which was partially offset by a decline in the Life Sciences segment, due to the divestiture of the CECS business. Consumable revenues increased by 9.6% for the three months ended December 31, 2024, as compared to the same period in the prior year, reflecting growth in the Healthcare and Life Sciences segments. Capital equipment revenues decreased 8.2% for the three months ended December 31, 2024, as compared to the same period in the prior year, reflecting declines in the Life Sciences and Healthcare segments.
Current wording
Service revenues increased 12.4% for the three months ended June 30, 2025, as compared to the same period in the prior year, reflecting growth in all three segments. Consumable revenues increased by 5.0% for the three months ended June 30, 2025, as compared to the same period in the prior year, reflecting growth in the Healthcare and Life Sciences segments. Capital equipment revenues increased 5.5% for the three months ended June 30, 2025, as compared to the same period in the prior year, driven primarily by growth in the Healthcare segment.
Previous wording
United States revenues increased 5.5% to $1,002.6 million for the three months ended December 31, 2024, as compared to $950.0 million for the same period in the prior year, reflecting growth in service and consumable revenues, partially offset by a decline in capital equipment revenues.
Current wording
United States revenues increased 8.3% to $1,025.6 million for the three months ended June 30, 2025, as compared to $946.9 million for the same period in the prior year, reflecting growth in service, consumable, and capital equipment revenues.
Previous wording
Revenues from other foreign locations increased 4.8% to $343.9 million for the three months ended December 31, 2024, as compared to $328.2 million for the same period in the prior year, reflecting growth in the Europe, Middle East & Africa ("EMEA"), Asia Pacific, and Latin American regions, partially offset by a decline in Canada.
Current wording
Revenues from other foreign locations increased 10.5% to $342.9 million for the three months ended June 30, 2025, as compared to $310.4 million for the same period in the prior year. The increase reflects growth within Europe, Middle East & Africa, Asia Pacific, Latin America, and Canada.
Previous wording
Gross Profit. Our gross profit is affected by the volume, pricing, and mix of sales of our products and services, as well as the costs associated with the products and services that are sold. The following tables compare our gross profit for the three and nine months ended December 31, 2024 to the three and nine months ended December 31, 2023:
Current wording
Gross Profit. Our gross profit is affected by the volume, pricing, and mix of sales of our products and services, as well as the costs associated with the products and services that are sold. The following table compares our gross profit for the three months ended June 30, 2025 to the three months ended June 30, 2024:
Previous wording
Gross profit percentage for the first nine months of fiscal 2025 was 44.3% compared to gross profit percentage for the first nine months of fiscal of 2024 of 44.0%. Favorable impacts from pricing (140 basis points), mix (30 basis points), material costs (30 basis points), and divestitures (20 basis points), were partially offset by unfavorable impacts from labor and overhead costs (140 basis points) and adjustments and other charges (50 basis points).
Current wording
Gross profit percentage for the first three months of fiscal 2026 was 45.1% compared to gross profit percentage for the first three months of fiscal of 2025 of 44.7%. Favorable impacts from pricing (130 basis points), productivity (70 basis points), and other cost reductions (40 basis points) were partially offset by unfavorable impacts from inflation (80 basis points), tariff costs (70 basis points), mix (30 basis points), and material costs (20 basis points).
Previous wording
Operating Expenses. The following table compares our operating expenses for the three and nine months ended December 31, 2024 to the three and nine months ended December 31, 2023:
Current wording
Operating Expenses. The following table compares our operating expenses for the three months ended June 30, 2025 to the three months ended June 30, 2024:
Previous wording
Selling, General, and Administrative Expenses. Significant components of total selling, general, and administrative expenses (“SG&A”) are compensation and benefit costs, fees for professional services, travel and entertainment expenses, facility costs, and other general and administrative expenses. SG&A increased 8.8% and 6.1% in the three and nine month periods ended December 31, 2024, respectively, compared to the same prior year periods. The fiscal 2025 increase is primarily attributable to increased benefit costs, as well as legal costs associated with our ethylene oxide litigation. For more information regarding our ongoing litigation, refer to Note 10 to our consolidated financial statements titled, "Commitments and Contingencies."
Current wording
Selling, General, and Administrative Expenses. Significant components of total selling, general, and administrative expenses (“SG&A”) are compensation and benefit costs, fees for professional services, travel and entertainment expenses, facility costs, and other general and administrative expenses. SG&A increased 5.4% in the three month period ended June 30, 2025 compared to the same prior year period. The fiscal 2026 increase is primarily attributable to increased compensation and benefit costs, as well as unfavorable foreign currency movements and increased bad debt expense.
Previous wording
Research and Development. Research and development expenses increased 8.3% and 4.9% in the three and nine month periods ended December 31, 2024, respectively, compared to the same prior year periods. Research and development expenses are influenced by the number and timing of in-process projects and labor hours and other costs associated with these projects. Our research and development initiatives continue to emphasize new product development, product improvements, and the development of new technological platform innovations. During fiscal 2025, our investments in research and development have continued to be focused on, but were not limited to, enhancing capabilities of sterile processing combination technologies, procedural products and accessories, and devices and support accessories used in gastrointestinal endoscopy procedures.
Current wording
Research and Development. Research and development expenses increased 3.1% in the three month period ended June 30, 2025 compared to the same prior year period. Research and development expenses are influenced by the number and timing of in-process projects and labor hours and other costs associated with these projects. Our research and development initiatives continue to emphasize new product development, product improvements, and the development of new technological platform innovations. During fiscal 2026, our investments in research and development have continued to be focused on, but were not limited to, enhancing capabilities of sterile processing technologies, procedural products and accessories, and devices and support accessories used in gastrointestinal endoscopy procedures.
Previous wording
Restructuring Expenses. In May 2024, we adopted and announced a targeted restructuring plan (the "Restructuring Plan"). This plan includes a strategic shift in our approach to the Healthcare surgical business in Europe, as well as other actions including the impairment of an internally developed X-ray accelerator, product rationalizations and facility consolidations. Fewer than 300 positions are being eliminated. These restructuring actions are designed to enhance profitability and improve efficiency, and we expect these actions to be substantially complete by the end of fiscal 2025. We anticipate improvements in income from operations of approximately $25.0 million per year, with the majority of the benefit being in fiscal 2026 and beyond due to timing of actions.
Current wording
Restructuring Expenses. In May 2024, we adopted and announced a targeted restructuring plan (the "Restructuring Plan"). This plan includes a strategic shift in our approach to the Healthcare surgical business in Europe, as well as other actions including the impairment of an internally developed X-ray accelerator, product rationalizations and facility consolidations. Approximately 300 positions have been eliminated. These restructuring actions were designed to enhance profitability and improve efficiency, and are expected to improve income from operations by approximately $25.0 million per year in fiscal 2026 and beyond.
Previous wording
The following tables summarize our total pre-tax restructuring expenses recorded in fiscal 2025 related to the Restructuring Plan:
Current wording
The following table summarizes our total pre-tax restructuring expenses recorded during the first three months ended June 30, 2025 and 2024 related to the Restructuring Plan:
Previous wording
The Restructuring Plan expenses incurred during the three and nine months ended December 31, 2024 primarily related to actions taken within our Healthcare segment. Total pre-tax restructuring expense of $77.5 million has been recorded relating to the Restructuring Plan since inception, of which $20.7 million has been recorded in Cost of revenues. We expect to incur additional costs, primarily for lease and other contract termination and other costs, of approximately $20.0 million, predominantly through the remainder of fiscal 2025.
Current wording
The Restructuring Plan expenses incurred during the first three months ended June 30, 2025 and 2024 primarily related to actions taken within our Healthcare segment. Total pre-tax restructuring expense of $108.4 million has been recorded relating to the Restructuring Plan since inception, of which $34.6 million has been recorded in Cost of revenues. Additional costs with respect to our Restructuring Plan are not expected to be significant during fiscal 2026.
Previous wording
Non-Operating Expenses, Net. The following tables compare our net non-operating expenses for the three and nine months ended December 31, 2024 and 2023:
Current wording
Non-Operating Expenses, Net. The following table compares our net non-operating expenses for the three months ended June 30, 2025 and 2024:
Previous wording
Non-operating expenses, net, consists of interest expense on debt, offset by interest earned on cash, cash equivalents, and short-term investment balances, and other miscellaneous income.
Current wording
Non-operating expenses, net consists of interest expense on debt, offset by interest earned on cash, cash equivalents, short-term investment balances, and other miscellaneous (income) expense.
Previous wording
Interest expense decreased $19.9 million and $39.1 million during the third quarter and first nine months of fiscal 2025, respectively, as compared to the prior year periods, primarily due to the lower principal amount of debt outstanding as well as lower interest rates on floating rate debt. For more information, refer to Note 7 to our consolidated financial statements titled, "Debt."
Current wording
Interest expense decreased $14.5 million during the first three months of fiscal 2026 when compared to the same prior year period, primarily due to the lower principal amount of debt outstanding. For more information, refer to Note 7 to our consolidated financial statements titled, "Debt."
Previous wording
Gain on sale of business and equity investment was $0.1 million during the third quarter of fiscal 2025. Gain on sale of business and equity investment was $12.7 million for the first nine months of fiscal 2025 and primarily relates to the sale of our CECS business, which was partially offset by a loss recorded on an equity investment. For more information on our equity investments, refer to Note 17 to our consolidated financial statements titled, "Fair Value Measurements." For more information on our divestiture activity, refer to Note 3 to our consolidated financial statements titled, "Business Acquisitions and Divestitures."
Current wording
Gain on sale of business was $18.8 million during the first three months of fiscal 2025 and relates to the sale of our CECS business during fiscal 2025. For more information on our divestiture activity, refer to Note 3 to our consolidated financial statements titled, "Business Acquisitions and Divestitures."
Previous wording
Income Taxes. The following tables compare our tax expense and effective income tax rates for the three and nine months ended December 31, 2024 and 2023:
Current wording
Income Taxes. The following table compares our tax expense and effective income tax rates for the three months ended June 30, 2025 and 2024:
Previous wording
The effective income tax rates from continuing operations for the three month periods ended December 31, 2024 and 2023 were 24.2% and 21.6%, respectively. The effective income tax rates from continuing operations for the nine month periods ended December 31, 2024 and 2023 were 22.4% and 21.9%, respectively. The fiscal 2025 effective tax rates increased when compared to fiscal 2024, primarily due to unfavorable discrete items recorded in fiscal 2025 and changes in geographic mix of projected profits.
Current wording
The effective income tax rates from continuing operations for the three month periods ended June 30, 2025 and 2024 were 23.3% and 20.1%, respectively. The fiscal 2026 effective tax rates increased when compared to fiscal 2025, primarily due to changes in geographic mix of projected profits and unfavorable changes in discrete items.
Previous wording
Our Healthcare segment provides a comprehensive offering for healthcare providers worldwide, focused on sterile processing departments and procedural centers, such as operating rooms and endoscopy suites. Our products and services range from infection prevention consumables and capital equipment, as well as services to maintain that equipment; to the repair of re-usable procedural instruments; to outsourced instrument reprocessing services. In addition, our procedural solutions also include endoscopy accessories, instruments, and capital equipment infrastructure used primarily in operating rooms, ambulatory surgery centers, endoscopy suites, and other procedural areas.
Current wording
Our Healthcare segment provides a comprehensive offering for healthcare providers worldwide, focused on sterile processing departments and procedural centers, such as operating rooms and endoscopy suites. Our products and services range from infection prevention consumables and capital equipment, as well as services to maintain that equipment; to the repair of re-usable procedural instruments; to outsourced instrument reprocessing services. In addition, our procedural products also include endoscopy accessories, instruments, and capital equipment infrastructure used primarily in operating rooms, ambulatory surgery centers, endoscopy suites, and other procedural areas.
Previous wording
Our Life Sciences segment provides a comprehensive offering of products and services designed to support biopharmaceutical and medical device research and manufacturing facilities, in particular those focused on aseptic manufacturing. Our portfolio includes a full suite of consumable products, equipment maintenance, specialty services, and capital equipment.
Current wording
Our Life Sciences segment provides a comprehensive offering of products and services designed to support biopharmaceutical and medical device research and manufacturing facilities, in particular those focused on aseptic manufacturing. Our portfolio includes a full suite of capital equipment, consumable products, equipment maintenance and specialty services.
Previous wording
For the three and nine months ended December 31, 2024 and 2023, revenues from a single Customer did not represent ten percent or more of the Healthcare, AST or Life Sciences segment revenues.
Current wording
For the three months ended June 30, 2025 and 2024, revenues from a single Customer did not represent ten percent or more of the Healthcare, AST or Life Sciences segment revenues.
Previous wording
The following tables compare business segment revenues as well as impacts from acquisitions, divestitures, and foreign currency movements for the three and nine months ended December 31, 2024 and 2023.
Current wording
The following table compares business segment revenues as well as impacts from acquisitions, divestitures, and foreign currency movements for the three months ended June 30, 2025 and 2024.
Previous wording
AST revenues increased 9.9% to $258.1 million for the three months ended December 31, 2024, as compared to $234.9 million for the same prior year period. The constant currency organic growth of 9.5% is primarily due to increased pricing and volume, both impacting revenues by a mid-single digit percentage. AST revenues increased 8.8% to $764.7 million for the nine months ended December 31, 2024, as compared to $703.1 million for the same prior year period. The constant currency organic growth of 8.6% is primarily due to increased pricing, impacting revenues by a mid-single digit percentage, as well as increased volume.
Current wording
Healthcare revenues increased 8.2% to $974.7 million for the three months ended June 30, 2025, as compared to $901.2 million for the same prior year period. This increase reflects growth in service, consumable, and capital equipment revenues of 13.2%, 4.5%, and 5.9%, respectively. The constant currency organic growth of 7.6% is primarily due to increased volume, impacting revenues by a mid-single digit percentage, as well as increased pricing, impacting revenues by a low-single digit percentage.
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Current report — wording carried from elsewhere
Acquisitions and Divestitures. During the first three months of fiscal 2026, we completed a tuck-in acquisition which continued to expand our product and service offerings in the Healthcare segment. Total aggregate consideration was approximately$15.0 million.
Current report — wording carried from elsewhere
Organic revenue growth and constant currency organic revenue growth are non-GAAP financial measures of revenue performance. See "Non-GAAP Financial Measures" for more information.
Current report — wording carried from elsewhere
Unless legally required, STERIS does not undertake to update or revise any forward-looking statements even if events make clear that any projected results, express or implied, will not be realized.
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Previous report — wording carried elsewhere
Refer to Note 9 of our consolidated financial statements titled, "Income Taxes" for more information.