Solventum Reports Second Quarter 2026 Financial Results

- Reported sales increased 2.2%; organic sales increased 9.5%

- Announces intent to separate its Health Information Systems business segment

- Increases full-year 2026 guidance for organic sales growth, adjusted EPS and free cash flow

EAGAN, Minn., Aug. 5, 2026 /PRNewswire/ -- Solventum (NYSE: SOLV) today reported financial results for the second quarter ended June 30, 2026.

Second Quarter 2026 Highlights

- Sales of $2.2 billion, increased 2.2% on a reported basis; an increase of 9.5% on an organic basis

- GAAP diluted earnings per share of $0.53; adjusted diluted earnings per share of $2.55, a 50.9% increase

- Operating cash flow of $227 million; free cash flow of $144 million

"The Solventum team delivered another quarter of strong execution with results ahead of our expectations while continuing to advance our transformation," said Bryan Hanson, chief executive officer of Solventum. "We remain on track to achieve our long-term objectives as we build a more focused, dedicated MedTech company, well-positioned to create long-term shareholder value."

Discussion of Second Quarter Results

All comparisons are to the prior year period unless otherwise noted

- Organic sales growth of +9.5% in the quarter reflects strong performance across all reportable segments, primarily driven by volume and product mix and including the expected benefit of advance orders placed ahead of ERP cutovers.

- GAAP and adjusted gross margin both increased, driven by IEEPA tariff refund.

- GAAP selling, general and administrative expenses increased primarily due to higher costs associated with separation activities and net legal costs. Adjusted SG&A as a percent of sales was 26.0%, a decrease of 130 bps vs. prior year.

- GAAP operating income margin decreased, primarily driven by net legal costs, separation and restructuring costs. Adjusted operating income margin increased primarily due to a combination of IEEPA tariff refund and ERP-timing benefit.

- Operating cash flow for the quarter was $227 million and free cash flow was $144 million, ahead of expectations driven by timing of tax payments and insurance proceeds.

Other Business and Operational Highlights

- Announced the intent to separate its Health Information Systems business segment as part of the portfolio optimization phase of its transformation strategy. The proposed separation is expected to strengthen Solventum's focus as a dedicated MedTech company while enabling both businesses to pursue distinct growth and innovation priorities.

- The Solventum Foundation announced a $350,000 grant to America's ToothFairy to expand access to oral health screenings, dental education and fluoride treatment for more than 100,000 children and caregivers in underserved communities over the next year.

- For the second year in a row, named a Best Company to Work For by U.S. News & World Report in the categories of 'Health Care and Research' and 'Midwest.'

Full-Year 2026 Guidance

Solventum is updating its full year 2026 guidance as follows:

- Increased organic sales growth range to +2.5% to +3.0% (+3.5% to +4.0% excluding ~100 bps of SKU exit impact); from prior range of +2.0% to +3.0%

- Increased adjusted EPS range to $7.10 to $7.20; from the upper end of prior range of $6.40 to $6.60

- Increased free cash flow to be in the range of $200 million to $300 million; from prior estimate of ~$200M

Organic sales, adjusted diluted EPS and free cash flow amounts included in Solventum's full-year guidance are non-GAAP financial measures. Solventum does not provide reconciliations of the forward-looking non-GAAP financial measures to the respective GAAP metrics as it is unable to predict with reasonable certainty and without unreasonable effort certain items, such as the impact of changes in currency exchange rates, impacts associated with business acquisitions or divestitures, and the timing and magnitude of restructuring activities, among other items.

See the "Non-GAAP Financial Measures" section for explanations of our non-GAAP financial measures.

Earnings Conference Call

Solventum will host a conference call today, August 5, at 4:30 p.m. Eastern Time to discuss its second quarter financial results and fiscal year 2026 outlook. The conference call can be accessed via audio webcast at investors.solventum.com or by dialing (800) 715-9871 within the U.S. or +1 (646) 307-1963 for international callers, using the conference ID 6342275.

A replay of the webcast, along with the earnings press release, slides highlighting the results and supplemental financial disclosures, will also be available at the same link on the Investor Relations section of the Company's website.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934 that are subject to risks and uncertainties. Solventum intends the forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in those sections. Forward-looking statements include all statements that are not historical facts, but instead represent only Solventum's beliefs regarding future goals, plans and expectations about its prospects for the future and other events, many of which, by their nature, are inherently uncertain and outside of Solventum's control. Forward-looking statements include those containing such words as "anticipates," "believes," "can," "continue," "could," "estimates," "expects," "forecasts," "goal," "guidance," "intends," "may," "outlook," "plans," "potential," "predicts," "projects," "seeks," "sees," "should," "targets," "will," "would," or other words of similar meaning in connection with any discussion of future operating or financial performance, business plans or prospects, Solventum's review of strategic alternatives for its health information systems business, or the potential benefits of any such strategic alternatives or transaction.

Among the factors that could cause actual results to differ materially from those described in our forward-looking statements are the following: (1) whether Solventum will be able to identify or develop any strategic alternatives for Solventum's health information systems business; (2) Solventum's ability to execute on material aspects of any strategic alternatives that are identified and pursued; (3) whether Solventum can actually achieve the potential benefits of any strategic alternatives; (4) the occurrence of any event, change or other circumstances that could give rise to the abandonment of the review of strategic alternatives or pursuit of a different structure or strategic alternative; (5) uncertainties as to the timing of the review of strategic alternatives; (6) the effects of, and changes in, worldwide economic, political, regulatory, international, trade and geopolitical conditions, natural disasters, war, public health crises and other events beyond Solventum's control; (7) operational execution risks; (8) damage to Solventum's reputation or its brands; (9) risks from acquisitions, strategic alliances, divestitures and other strategic events; (10) Solventum's business dealings involving third-party partners in various markets; (11) Solventum's ability to access the capital and credit markets and changes in Solventum's credit ratings; (12) exposure to interest rate and currency risks; (13) the highly competitive environment in which Solventum operates and consolidation in the healthcare industry; (14) reduction in customers' research budgets or government funding; (15) the timing and market acceptance of Solventum's new product and service offerings; (16) ongoing working relationships with certain key healthcare professionals; (17) changes in reimbursement practices of governments or private payers or other cost containment measures; (18) Solventum's ability to obtain components or raw materials supplied by third parties and other manufacturing and related supply chain difficulties, interruptions and disruptive factors; (19) legal and regulatory proceedings and legal compliance risks (including third-party risks) with regards to antitrust, FCPA and other anti-bribery laws, environmental laws, anti-kickback and false claims laws, privacy laws, product liability claims, tax laws, and other laws and regulations in the United States and other countries in which Solventum operates; (20) potential liabilities related to per-and polyfluoroalkyl substances, collectively known as "PFAS"; (21) risks related to the highly regulated environment in which Solventum operates; (22) risks associated with product liability claims; (23) climate change and measures to address climate change; (24) security breaches and other disruptions to information technology infrastructure; (25) artificial intelligence risks; (26) Solventum's failure to obtain, maintain, protect or effectively enforce its intellectual property rights; (27) pension and postretirement obligation liabilities; (28) Solventum's separation from 3M and performance as a standalone company, including the tax-free nature of the spin and its ability to execute on its short- and long-range plans and capital allocation strategies; and (29) restructuring programs, and other risks and uncertainties described in Solventum's filings with the U.S. Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q.

The above list is not exhaustive or necessarily set forth in the order of importance. Forward-looking statements are based on certain assumptions and expectations of future events and trends, and actual future results and trends may differ materially from historical results or those reflected in any such forward-looking statements depending on a variety of factors.