BDX · 10-Q · 2026Q2 · Full report

Gross Margin Drivers

BECTON DICKINSON & CO · 2026-08-06 · Importance 45 · Surprise 50 · No source text

Third-quarter gross margin declined to 46.4% from 47.3% a year earlier, a 90-basis-point decrease. Operating performance reduced the quarterly margin by 0.8 percentage points, primarily because of tariffs, higher labor costs and costs required to respond to the El Paso Warning Letter. Lower manufacturing costs from BD Excellence continuous-improvement projects partially offset those pressures, while foreign currency reduced margin by another 0.2 percentage points. Nine-month gross margin increased to 46.0% from 43.5%, primarily because the prior-year period included a $336 million Advanced Patient Monitoring inventory fair-value step-up charge.

Key facts

• Gross profit margin for the three months ended June 30, 2025 was 47.3% and for the three months ended June 30, 2026 was 46.4%; for the nine-month period June 30, 2025 gross profit margin was 43.5% and for June 30, 2026 was 46.0%. source
• Operating performance impacts to gross margin in 2026 primarily reflected tariffs, higher labor costs, and charges recorded in the Interventional segment to recognize costs associated with certain actions required to respond to the El Paso Warning Letter. source
• BD's amortization expense related to purchase accounting is recorded in Cost of products sold. source

Impact estimates