LAKEWOOD, Colo., Aug. 05, 2025 (GLOBE NEWSWIRE) — Mesa Laboratories, Inc. (NASDAQ:MLAB), a global leader in the design and manufacture of life science tools and critical quality control solutions, today announced results for its first fiscal quarter (“1Q26”) ended June 30, 2025 (amounts in thousands).
First quarter FY26 compared to first quarter FY25:
- Revenues increased 2.4%
- Non-GAAP core organic revenues1 growth was 0.4%
- Operating income decreased 45.1% to $3,064 primarily due to the impacts of FX and non-cash stock-based compensation expense
- Non-GAAP adjusted operating income (“AOI”) excluding unusual items2 decreased 15.9% and was 21.7% as a percentage of revenues
We operate our business in four divisions: Sterilization and Disinfection Control (“SDC”), Clinical Genomics (“CG”), Biopharmaceutical Development (“BPD”), and Calibration Solutions (“CS”).
Executive Commentary (amounts in thousands)
“Against a highly volatile macroeconomic environment, the team’s leverage of the Mesa Way operating model delivered quarterly revenues of $59,543 or 2.4% organic (0.4% core organic) revenues growth. Negotiating final tariff surcharges in BPD resulted in approximately $1.5M of expected 1Q26 revenues shifting into 2Q26. Strong growth in SDC and CG growth of 7.9% excluding China overcame a continued contraction of CG China revenues of approximately $1.8M or 69% as compared to the same quarter in the prior year. In consideration of BPD timing delays and overall bookings strength, we expect to meet our revenue goals for the first half of the fiscal year” said Gary Owens, Chief Executive Officer of Mesa.
“Profitability for the quarter, using our preferred metric of AOI excluding unusual items as a percentage of revenues, was 21.7% as compared to 26.4% in the same quarter of the prior year and 23.5% for FY25. Gross profit percentage contracted by 200 bps versus the first quarter of the prior year (which included $778 of non-cash inventory step up amortization), of which 40 bps were associated with tariff-related charges. The remaining contraction was primarily due to FX and the impact of strategically prioritized BPD shipments of low margin hardware to China. Operating expenses were within our expected range but did increase 250 bps versus the same quarter prior year due to investments in commercial resources during the back half of FY25 and the significant impact of FX. In total we paid approximately 1% of revenues in tariffs with a significant portion either passed onto customers or capitalized into inventory. We will continue to work diligently to counter the impact of tariffs on the bottom line through a combination of price increases or surcharges while prioritizing customer retention and topline growth. With the expected additional revenue in 2Q26, we expect to see AOI excluding unusual items as a percentage of revenues to meaningfully improve in the second quarter” added Mr. Owens.
“Continuously improving our internal processes is the best way to counter macroeconomic storms. The Mesa Way was in action this May in Breakthrough 7, where we began deploying this year’s Clinical Genomics division’s strategic plan. In Breakthrough 7 we focused on accelerating New Product Development, excellence in Product Launches, spreading best practices and tools for Customer Prospecting, and Manufacturing Scrap Reduction. Each team had stretch goals, diagnosed opportunities for process improvement, try stormed solutions, and implemented improvements. In the coming quarters through rigorous follow through we expect to sustain material improvements as well as learn more about new areas where process innovation can drive new customer adoption and reduce waste” added Mr. Owens.
“While 1Q26 was challenging in the face of a difficult macroeconomic environment, we are encouraged by our continuing commercial success, traction with key initiatives, and the resilience of our operating model” concluded Mr. Owens.
Financial Results (unaudited, amounts in thousands, except per share data)
Total revenues were $59,543, an increase of 2.4% compared to 1Q25. Operating income decreased 45.1% to $3,064. Net income was $4,742, an increase of 40.0%, or $0.85 per diluted share of common stock. On a non-GAAP basis, core organic revenues growth was 0.4% and AOI decreased 7.7% to $12,902 or $2.32 per diluted share of common stock, compared to 1Q25. As detailed in the Unusual Items table below, AOI for 1Q25 was negatively impacted by unusual items totaling $1,368. Excluding the unusual items for 1Q25, AOI decreased 15.9% to $12,902. A reconciliation of non-GAAP measures is provided in the tables below. Total Net Leverage Ratio3 was 3.16 as of June 30, 2025.
Division Performance
| Revenues | Organic Revenues Growth1 | Core Organic Revenues Growth | ||
| (Amounts in thousands) | Three Months Ended June 30, 2025 |
Three Months Ended June 30, 2025 |
Three Months Ended June 30, 2025 |
|
| SDC | $ | 25,410 | 10.7% | 7.5% |
| BPD | 11,486 | (4.3)% | (7.0)% | |
| CS | 12,350 | 4.7% | 4.8% | |
| CG | 10,297 | (9.7)% | (10.7)% | |
| Total | $ | 59,543 | 2.4% | 0.4% |
Sterilization and Disinfection Control (43% of revenues in 1Q26) revenues were $25,410 for the quarter, which delivered core organic revenues growth of 7.5%. This growth was driven by strong commercial execution which resulted in orders growth greater than revenues growth. Revenues growth was also enhanced by a reduction in past-due backlog as our manufacturing productivity increased. We expect to continue to reduce our past due backlog over the remainder of fiscal year 2026. Gross profit percentage for the quarter increased by 370 bps versus the same quarter in the prior year primarily due to a 340 bps benefit from non-cash inventory step-up charges in 1Q25.
Biopharmaceutical Development (19% of revenues in 1Q26) revenues were $11,486 for the quarter, a core organic revenues decline of 7.0%. As described above, the decline in revenues was driven by the timing of order placements and shipping delays, absent of which we would have shown positive revenues growth of approximately 8.0%. Gross profit percentage contracted 1,140 bps for the quarter due primarily to unfavorable product mix, delayed volumes, and FX, a significant amount of which is denominated in SEK which has appreciated 12.4% vs the USD in the past year. For the full year FY26, we expect mix to normalize and therefore gross profit percentage to improve over the course of the year.
Calibration Solutions (21% of revenues in 1Q26) revenues were $12,350 for the quarter, which delivered core organic revenues growth of 4.8%. Revenues growth was driven primarily by strong commercial execution, particularly in our renal care line, and to a lesser extent, price increases. Gross profit percentage decreased by 440 bps for the quarter, primarily due to raw material price headwinds driven by tariffs, increased labor costs, and to a lesser extent product mix.
Clinical Genomics (17% of revenues in 1Q26) revenues were $10,297 for the quarter, which resulted in a core organic revenues decline of 10.7%. A contraction in China revenues of approximately $1.8M, or 69% versus the same quarter prior year, were partially offset by 7.9% growth outside of China. China represented approximately 8% of total division revenues for 1Q26 versus approximately 19% for FY25. The China contraction was driven by macroeconomic and tariff uncertainty as well as ongoing regulatory headwinds. Growth outside of China, was primarily from consumables as we execute against our new product development and commercial strategy which should continue to deliver over the remainder of the fiscal year. Gross profit percentage decreased by 420 bps for the quarter, primarily due to decreased volumes.
Use of Non-GAAP Financial Measures
Adjusted operating income, adjusted operating income excluding unusual items, organic revenues growth and core organic revenues growth are non-GAAP measures that exclude or adjust for certain items, as detailed within the tables in “Supplemental Information Regarding Non-GAAP Financial Measures.”
1 Organic revenues growth is defined as reported revenues growth excluding the impact of acquisitions and core organic revenues growth is defined as organic revenues growth excluding currency translation. A reconciliation of these non-GAAP measures to their GAAP counterpart is set forth below.
2 Adjusted operating income and adjusted operating income per share are defined to exclude the non-cash impact of amortization of intangible assets acquired in a business combination, stock-based compensation, depreciation and impairment of goodwill and long-lived assets. These measures are also presented excluding unusual items. A reconciliation of these non-GAAP measures to their GAAP counterparts is set forth below, along with additional information regarding their use.
3 Total Net Leverage Ratio under our Credit Facility is defined as the ratio of total debt minus unrestricted cash in excess of $10 million as compared to 12 months trailing EBITDA. EBITDA, a non-GAAP metric, for purposes of this calculation, is defined as net income plus the sum of interest expense, income tax expense, depreciation, amortization, unusual or non-recurring non-cash charges and stock compensation expense.
About Mesa Laboratories, Inc.
Mesa is a global leader in the design and manufacture of life science tools and critical quality control solutions for regulated applications in the pharmaceutical, healthcare and medical device industries. Mesa offers products and services to help our customers ensure product integrity, increase patient and worker safety, and improve the quality of life throughout the world.
For more information about Mesa, please visit its website at