Waters Corporation's Q2 2025: Key Contradictions on Tariffs, Growth Drivers, and Market Outlook

Tariff impact on margins, India as a growth driver, impact of tariffs on margins, growth expectations for LCMS, and China's growth sustainability are the key contradictions discussed in Waters Corporation's latest 2025Q2 earnings call.



Strong Revenue Growth and Sales Performance:
- Waters Corporation reported sales of $771 million for Q2 2025, up 9% as reported and 8% in constant currency.
- Growth was led by Waters Division, with strong performance across Americas, Europe, and Asia, and contributions from Pharma and Industrial segments.

Increased Instrument and Recurring Revenue:
- Instrument sales grew mid-single digits, led by high single-digit growth in the LC and mass spec portfolio.
- Recurring revenue saw a 11% increase, driven by 9% service growth and double-digit chemistry growth, partly influenced by favorable tariff dynamics.

Technological Innovation and Product Launches:
- Recent product launches such as Alliance iS and the Xevo TQ Absolute platforms experienced strong traction, with Alliance iS sales growing 300% year-over-year.
- Customer response to the Xevo TQ Absolute XR was outstanding, with more than double the expected orders in Q2.

Geographical Diversification and China Growth:
- China reported high single-digit growth in Q2, driven by strength across all end markets, including significant growth in the CDMO segment.
- The growth was attributed to localization of the product portfolio and leveraging new product innovations to win stimulus tender opportunities.