CooperCompanies reported fiscal third-quarter 2026 revenue of $1.066 billion, up 1% year over year, while record free cash flow and a significant tax benefit helped drive substantially higher GAAP earnings.
GAAP diluted EPS increased to $2.24 from $0.49, primarily because of a $307.2 million discrete tax benefit resulting from the favorable completion of a UK tax examination. Non-GAAP diluted EPS increased 4% to $1.15.
Free cash flow increased 66% to $273 million, reflecting $341.7 million of operating cash flow less $68.7 million of capital expenditures.
GAAP operating margin increased to 21% from 17%, while non-GAAP operating margin expanded 30 basis points to 26%. Gross margin was 67%, compared with 65% in the prior-year period.
CooperVision generated $717 million of revenue, approximately flat year over year. Toric and multifocal revenue increased 1% to $363.8 million, while sphere and other revenue declined 2% to $353.2 million.
CooperSurgical revenue increased 2% to $349.2 million, or 3% organically. Fertility revenue rose 3% on a reported basis and 5% organically to $141.2 million.
CooperCompanies repurchased approximately $339.1 million of common stock during the quarter, representing roughly 4.9 million shares. Its board subsequently expanded the total repurchase authorization from $2 billion to $3 billion, leaving approximately $1.5 billion available.
For fiscal 2026, CooperCompanies now expects total revenue of $4.229 billion to $4.252 billion, representing organic growth of 2% to 3%. CooperVision revenue is projected at $2.828 billion to $2.842 billion, while CooperSurgical revenue is expected at $1.401 billion to $1.410 billion.
Full-year non-GAAP diluted EPS is expected at $4.51 to $4.55, and the company reaffirmed its objective to generate more than $2.2 billion of cumulative free cash flow during fiscal 2026 through fiscal 2028.
KEY QUOTE:
“This quarter included a number of notable developments including earnings exceeding expectations, record free cash flow, solid fertility growth at CooperSurgical, and a favorable completion of a significant tax matter. At CooperVision, however, we reduced U.S. channel inventory that weighed on our results and will continue to impact Q4,” said Al White, President and CEO of CooperCompanies. “Following the completion of the strategic review, we are focused on profitable growth, strong cash flow generation, disciplined capital allocation, and maximizing long-term shareholder value.”
Al White, President and CEO of CooperCompanies
