DHR · 10-Q · 2026Q2 · Full report

Gross Margin Drivers

DANAHER CORP /DE/ · 2026-07-21 · Importance 49 · Surprise 32 · In source text

Second-quarter gross profit increased to $3.611 billion from $3.523 billion, but gross margin declined 170 basis points to 57.6%. Six-month gross profit increased to $7.202 billion from $7.034 billion, while gross margin declined 120 basis points to 59.0%. Cost of sales increased to $2.654 billion in the second quarter and $5.014 billion for the first six months, primarily due to higher sales volumes, acquired businesses and a $46 million Masimo-related inventory fair-value charge. Product mix and the Masimo inventory adjustment reduced gross margin, while the prior-year $15 million Biotechnology facility impairment partially offset the six-month comparison.

Key facts

• Gross profit for the three-month period ended June 26, 2026 was $3,611 million and cost of sales was $2,654 million, yielding a gross profit margin of 57.6%. source
• Gross profit for the six-month period ended June 26, 2026 was $7,202 million, cost of sales was $5,014 million, yielding a gross profit margin of 59.0%. source
• The increase in cost of sales was primarily due to higher year-over-year sales volumes, the impact of recently acquired businesses and a $46 million acquisition-related charge associated with the fair value adjustment to inventory recorded in connection with the Masimo Acquisition in the second quarter of 2026. source
• In the six-month period ended June 26, 2026, increases in cost of sales were partially offset by a $15 million impairment charge related to a facility in the Biotechnology segment recorded in 2025. source
• Year-over-year gross profit margin decreased during both the three and six-month periods ended June 26, 2026 primarily due to the impact of product mix and the fair value adjustment to inventory in 2026, partially offset by the facility impairment recorded in 2025. source

Impact estimates