What caused STE's earnings to outperform in Q3 2025?

Steris' (STE) Q3 2025 earnings outperformance can be attributed to several key factors: 1. **Revenue Growth**: The company reported a 6% increase in total revenue from continuing operations, reaching $1.37 billion. This growth was driven by volume and price increases, with strong contributions from its Healthcare and AST segments. 2. **Segment Performance**: The Healthcare segment saw a 7% growth in constant currency organic revenue, driven by robust service and consumable revenue streams. The AST segment reported a 10% increase in revenue, reflecting growth in service revenues despite a decline in capital equipment revenues. 3. **Gross Margin Improvement**: Gross margin improved by 90 basis points to 44.6%, indicating effective management of costs and pricing strategies. This improvement contributed to the overall financial performance. 4. **Operating Cash Flow**: Steris reported a robust operating cash flow of $887.3 million for the first nine months of the fiscal year, on track to meet the full-year guidance of $700 million. This strong cash flow reflects the company's operational efficiency and financial health. 5. **Market Share Gains**: The company's focus on infection prevention products and services, coupled with successful market adoption of its comprehensive offerings, has led to market share gains and sustained demand for its products. In summary, Steris' Q3 2025 earnings outperformance can be attributed to revenue growth, strong segment performance, gross margin improvement, operating cash flow, and market share gains. These factors collectively contributed to the company's solid financial performance and investor confidence.