bioMerieux SA Stock

Hello, and welcome to the bioMérieux Half Year 2026 Financial Performance Call. Please note this webcast is being recorded. [Operator Instructions]

I will now hand the conference over to Aymeric Fichet, Head of Investor Relations.

Thank you. Hello, everyone. Good afternoon, and thank you for joining this call. I am with Pierre Boulud, CEO, together with Guillaume Bouhours, CFO. Please note that this conference call will include forward-looking statements that may change or be modified due to uncertainties and risks related to the company's environment. Accordingly, we cannot give any assurance as to whether we will achieve these objectives. I also remind you that today's call is being recorded and that the replay will be available on our website, www.biomerieux-finance.com.

I will now hand the call over to Pierre, and then we will open the call to questions. Pierre?

Hello, everyone. Good afternoon. So a couple of words on the agenda first. I will, first of all, share a few highlights on the business for the first half of the year, I hand over to Guillaume, who will go into more details around the financial performance and 2026 outlook. And I'll finish the call with a few words on ambitions for 2027 and 2028. So you heard the disclaimers from Aymeric. Moving on the H1 highlights. So, as you've seen, we are reporting a sales growth that accelerated in Q2, plus 5%, 7.3% excluding respiratory panel sales. That is compensating a lower Q1 that was at 3.9% of decline, significantly impacted by the low respiratory epidemiology.

Our CEBIT at the end of H1 declined by 5% organically, reflecting especially the modest sales evolution that we had in Q1. We kept a sustained focus on innovation, I'll come back to that, with multiple product launches in H1.

[Audio Gap]

Cash flow generation. Almost EUR 300 million of free cash flow generated in H1, growing 76% versus H1 2025. Guillaume, again, will share more details on this cash flow generation.

To give you a bit more color on the financial performance, I would like to give a bit more qualitative comments on the different pillars of the GO•28 initiatives. I've already mentioned multiple launches. So Q2 was heavy actually in terms of innovation. We have filed in June a revised panel for BIOFIRE gastrointestinal panel that improves its performance and its relevance in the market. With regards to point-of-care, we are accelerating with the filing of vaginitis panel to the FDA and to the European authorities.

And we are very happy to get the approval in June of SPINCHIP, the first test on SPINCHIP, the immunoassays platform that we acquired last year, for high sensitive troponin. Finally, in industry, a couple of launches I would like to highlight. GENE-UP TYPER for Salmonella, a very common contamination that we see in the food industry that allows to better identify the source of the contamination, and Accellix acquisition that is further strengthening our offering in the pharma quality control.

With regards to GO.Simple, making also good progress in Q2. Headcount evolution is very much under control. We actually have 200 headcounts less at the end of June versus end of December, so managing our cost efficiently. And especially, we've implemented a reduction of workforce in China following a difficult 2025 that we have gone through.

And also decided to accelerate the closing of the San Jose site by 1 quarter. We are progressing also on SG&A efficiency and implementing the different operating model that we have engineered.

With regards to COGS improvement, I would like to highlight two elements. Automation for BIOFIRE. We are now at 60% of BIOFIRE pouch intake, 100% automated. And with regards to procurement, additional savings above EUR 10 million. With regards to GO Stronger, we've conducted a voice of employee, and we are for the third year in a row within the top 25% of the healthcare industry in terms of engagement. With regards to our sustainability objective, we are very much on track with CSR ambition. At the end of June, we have reduced by 31% our greenhouse gas absolute emissions.

So moving into business highlights, I would like to highlight Q2 performance. As I said, very strong performance actually in Q2. GO•28 growth drivers have grown 8.5% in Q2. If you allow me to start with BIOFIRE non-respiratory, we've grown 7% in Q2 with a further increase of our install base. We keep increasing the number of instruments that are in the market and leveraging a cross-selling strategy. With regards to SPOTFIRE, very strong performance. If I look at reagent sales only in Q2, we've grown 40% in the context of low epidemiology, and 400 instruments installed in Q2 with no specific one-off, neither in Japan nor in the U.S. So it's actually our strongest Q2 since launch. So first of demonstrating a good commercial uptake. We are now at 7,200 instruments, so our install base is 60% bigger than it was in June 2025.

In microbiology, very much in line with our 2026 guidance.

We've seen improvements in China. We've also seen improvements in instrument sales that you know were slow in Q1, and very solid dynamics in blood culture. Finally, industrial applications, very strong, 9% sales growth with very strong performance for reagents, growing double digits with price increase and strong dynamics in the pharma segment. BIOFIRE respiratory panels have been declining 6%, little bit of price erosion, very similar to what we've experienced in the past, 2 to 3 percentage points. And even though it impacts us less than in Q1, a couple of points, but lower respiratory epidemiology. Immunoassay is almost flat, with good dynamics on VIDAS KUBE.

Now with this, I wanted to highlight Q2, but I'm handing over to Guillaume to share with you performance for H1.

Thank you, Pierre. Hello, everyone. So let's look at the H1 organic growth overall, plus 0.2% organic, thanks to the 5% in Q2 that Pierre just highlighted. So overall in H1, we see the following trends. BIOFIRE non-RP at plus 5.5%. And with, again, low epidemiology impacting pneumonia there in Q1 and a solid percent in Q2. BIOFIRE RP, okay, we discussed it on much lower epidemiology than last

[Audio Gap]

I think it's important to highlight reagents overall in H1 plus 35%, despite, as you all know, a lower -- a much lower epidemiology in H1 '26 than H1 '25.

Microbiology, so overall, plus 4% in H1. And notably, very strong dynamic on BACT/ALERT. So our blood culture reagents. And I think Pierre mentioned the positive price increase that we are able to deliver in microbiology. Immunoassay minus 3%, but actually when we exclude, and we know the trends of China and procalcitonin PCT, when we exclude those two, we are on a slight growth path, positive. And industrial applications continuing to deliver well, as Pierre mentioned, with acceleration even in Q2, plus 7% overall in H1, with reagent sales up double-digit, including also there some price increases between 1% and 2%.

If we turn now to the view of H1 by geography, a few comments there. So North America, overall minus 1%. Of course, it's a region that is most exposed in our portfolio to respiratory with BIOFIRE RP and SPOTFIRE. Yet we saw, in the region, solid growth in industry applications, in non-respiratory panels, and in microbiology. Latin America continued on a super good dynamic, overall plus 11% organic in H1, actually solid on all product lines in LatAm.

EMEA, as you can see, plus 2% organic, notably good growth on BIOFIRE non-RP, industry applications, and microbiology. Asia Pacific delivered minus 3%, but it's actually a very contrasted picture inside Asia Pacific, where China was down 6% overall in H1. And I remind you of the weight of its microbiology for us. We also had a negative trend in Japan that's a bit new, that was mainly due to changes expected in the regulatory coverage population for SPOTFIRE in Japan. On the other hand, in Asia Pacific, we saw very strong growth in India and a very good level of growth in South Korea, balancing China and Japan overall.

With that, let's look to our income statement. So I will comment mainly on the organic. So it's called a change like-for-like on the right column. So as said -- we said up 0.2% organic. We delivered the gross profit slightly down minus 1%, and actually margin on an organic basis, minus 70 basis points. This is due to a slightly unfavorable product mix, of course, with a lower share of BIOFIRE RP, one of our high-profit products. And also an increase in our manufacturing projects spend and the impact of the Middle East events twofold. One that you can expect on the transport cost of our products from the oil prices, but also some raw materials that are plastic-based that also saw some increase.

Important to note, in terms of tariffs. So I'm talking about the U.S. tariffs, they were quite neutral year-on-year from H1 '25 to H1 '26 as we have the new tariffs applied in H1 '26, which were not in place in H1 '25, but these were offset by the fact that we were able to apply for reimbursement of 2025 extra tariffs, the ones that were, let's say, rebuffed by the Supreme Court, and that we received the reimbursements for more or less similar amounts to the tariffs we pay for H1.

Moving to SG&A. So our sales, general, and administrative costs were overall, as you can see, down 2% in H1 due to lower variable compensation for our teams and also the effect of GO•28 efficiency initiatives and additional new cost measures, we'll come back to that, to adapt to the slightly lower -- slower growth. R&D expenses plus 5% in H1, leading to 13% of R&D over sales. So overall, as Pierre said, CEBIT is down 5% on a like-for-like basis with a margin of 15.9%. The margin itself is down 100 basis points on an organic basis. And when we look

[Audio Gap]

impact, negative, minus EUR 35 million, and the effect of change of scope acquisitions of minus EUR 5 million.

With that, we can have a look at the income statement below CEBIT. So first, the line of amortization of acquired intangibles came back to a normalized level at minus EUR 14 million for H1, after a very significant impact last year, which was a partial impairment of SPECIFIC REVEAL technology. Our net financial expense moved to minus EUR 5 million in H1. The slight move compared to last year is due to the evolution of foreign exchange on our cash pooling positions. Income tax on the P&L is, let's say, pretty stable in terms of effective tax rate, 23.4%. Overall, delivering an adjusted EPS that is down minus 4% organic. So pretty similar to the evolution organic of CEBIT, and minus 17% in terms of reported, also similar to the reported CEBIT evolution.

We can move to the cash flow. So bioMérieux delivers a very strong cash flow in H1. So from an EBITDA of EUR 440 million, slightly down, we had actually a cash generation from working capital, thanks to a good management of receivables, with notably a good cash collection from customers in the U.S. Inventory is actually down, that's positive, thanks to raw material optimization in terms of inventory. The other key element in the cash flow is definitely tax payments. So just to remind you that the U.S. tax reform, where it has no specific impact in the P&L but has a cash impact, a timing impact, very favorable for bioMérieux. That's what you see in the downturn of cash payments from EUR 123 million last year H1 to EUR 28 million this year H1.

CapEx at 7% of sales, very slightly down in million euros. Two-thirds of it is manufacturing, mainly for capacity automation, but one-third for placement of new instruments, mainly SPOTFIRE for our customers. So overall, a free cash flow at a very nice level of almost EUR 300 million compared to EUR 170 million last year and puts bioMérieux balance sheet at a strong position of a net cash of EUR 236 million on the balance sheet at the end of June.

With that, a few words on our 2026 outlook that we actually would like to reiterate and confirm. So based on the solid Q2 2026 that Pierre has detailed, and we must highlight a lower comp basis in H2 last year, which was at 3% versus plus 9% in H1 last year. We confirm the 2026 sales guidance for plus 3% to plus 5% organic sales evolution in 2026, and CEBIT guidance of 0% to 10% organic growth of CEBIT. That being said, I would like to maybe preempt, and I'm sure you have the usual question on what's the underlying assumption on the respiratory season. So basically, if Q4 2026 respiratory season is in line with Q4 2025, which itself was 10% below Q4 2024, we would expect full year '26 sales growth to stand more towards the bottom of the annual guidance range.

On the opposite, if there is a strong epidemiology in Q4, this would have a positive impact on respiratory panels, SPOTFIRE sales, and pneumonia panel sales. On CEBIT, it's important to mention that we see a slight improvement in the prospects of foreign exchange impact for the year, but now we revise to minus EUR 40 million to minus EUR 50 million. I remind you that we had an impact of minus EUR 35 million in H1. So we took the bulk of it in H1. And CapEx, we also revised slightly down from initially 9% of sales to more around 8% of sales.

And with that, I would like to hand over back to Pierre for the outlook of 2027 and 2028.

Thank you, Guillaume. So let's move now towards the midterm outlook. So what we wanted to share with you is what we see is that since 2024, the world has changed. We've seen a worsening of geopolitical environment that translates into a higher focus on defense and military spend. That comes in many countries at the expense of the healthcare budget, and that translates into financial pressure on our clients. So these evolutions make a good GO•28 plan even more relevant since we target to be more agile, more customer-focused, more efficient in order to better serve our customers.

Q1, as we shared, was heavily impacted by the epidemiology and the respiratory season. This impact has now faded into Q2. And we have now a clearer understanding of the dynamics into our different businesses. So to reflect this new environment, now that we are seeing better situation following the epidemiology impact of Q1, and we think this environment will stay in the next three years. We have decided to adjust our financial perspectives for 2027 and 2028. So with regards to sales growth, we now aim at 3% to 6% annual sales growth at constant exchange rate and scope for 2027 and 2028, with the very same focus on the growth driver that we are identifying for GO•28, I'll come back to that.

We also continue the implementation of all the initiatives that we had in the GO.Simple plan -- for the plan. And from a profitability perspective, we now aim to grow a bit higher than the organic sales growth that we've just revised for 2027 and 2028 at constant exchange rate and scope. With regards to GO Stronger and GO Responsible, we've actually kept the objectives unchanged. So if we go into the GO for Growth and respective growth drivers, this is a kind of summary slide of what we support this revised objective of 3% to 6% annual organic sales growth in 2027 and 2028.

So with regards to high-plex, actually the assumption that we've made, at the end of 2023, beginning of 2024, with regards to pricing erosion, market share evolution, are very consistent with what we're saying now, and actually they're very much in line with the plan. But we have adjusted to a market growth that is slower than what we expected, especially for non-respiratory, we're expecting a market to grow 10% to 15%, in that very dynamic market to grow 10%. We are seeing the market growing slower than that because of the financial constraints. So in that slower market growth, our new ambition is to grow from 4% to 8%.

SPOTFIRE, we've adjusted to take into account the fact that we are giving an objective in euros, but at 2023 euro exchange rate, and also take into account the fact that with the success of SPOTFIRE, we are now more dependent on the respiratory season, and Guillaume was mentioning it for 2026. So it's actually a very similar objective to the objective that we had, but we give it in terms of percentage of growth in 2027 and 2028. That goes between 25% to 40% growth versus what we've seen in 2026. Microbiology, the adjustment relates to China. When we communicated the plan in early 2024, we did not expect China to decline close to 15% in 2025. Guillaume said it's progressing a bit with a sales decline of 6% in H1.

But still, since China stands for 10% of global microbiology sales, we've kept all the other assumptions unchanged actually, in terms of price evolution, market share evolution, but that translates into a microbiology sales growth evolution of 3% to 5%, even though it stays very similar to what we were sharing until now, and industrial applications is actually the same. So if we go one by one on the different segments. So for non-respiratory panels, we still believe in spite of the competitive announcement that we have the best-in-class solutions, be it in terms of time to result. There is no better solution in the market today, even though they were more recently launched in terms of time to result.

We still have the largest menu in the market. With FIREWORKS, we're actually capable to give epidemiology data to our clients on a very regular basis. By the way, the cyclosporiasis outbreak in the U.S. is a clear demonstration that having cyclosporiasis into the high-plex panel allows to do real-time surveillance of what's happening in the U.S. in terms of outbreak. The fourth element I would like to mention is we're still growing our installer base. Since two [Audio Gap]

base by 3,000 units in two years, between end of 2023 and the end of 2025. So we will increase the install base by close to 12%, that is further supporting the sales growth in terms of reagents. And very high-level customer service that is highly acknowledged by and recognized by the customers.

Together with these best-in-class solutions, we keep bringing up-to-date panels. GI Mid was launched in 2025. We've just communicated that we are updating a GI panel to make it even more competitive. We're planning to launch a new meningitis panel in 2027 to keep up to speed in terms of performance. SPOTFIRE. As I said, very similar ambition versus what we were sharing earlier. We are uniquely positioned with 100% of the assays that were launched here that are CLIA Waived, which really truly allows us to address the point-of-care market.

We have still the fastest time to results and most comprehensive respiratory menu. As I shared, very strong traction and dynamic. 7,200 instruments since launch. 400 additional instruments in Q2 only. It's very exciting. We are starting to expand the SPOTFIRE menu outside of the respiratory infections with the vaginitis panel launch in Q2 '26, as we committed to in 2024. We are also preparing for STI launch in 2028 and meningitis panel launch in 2028. So that will allow to further expand SPOTFIRE success beyond respiratory disease. Microbiology. Maybe a few highlights here. First, blood culture practice is normalizing after the challenges from a major competitor with regards to bottle supply.

So we are seeing very dynamic sales in blood culture in 2026 that will further support the growth in the years to come. We are the only player that is capable to have a fully integrated offer from identification to antibiogram, and the only one that is capable to provide fast identification with BIOFIRE BCID, but also fast antibiogram with VITEK REVEAL. We keep bringing innovation. We've already launched the small VITEK replacement, VITEK COMPACT PRO. We are ramping up VITEK REVEAL. We are going to launch VITEK PRO, which is a big VITEK in 2027, and planning to launch the small VIRTUO, BACT/ALERT 3D in 2028.

And as I said, China is a big deal in microbiology, 10% of the microbiology sales. So as we are not expecting the market to grow as it used to be, we are localizing manufacturing for instruments to make sure that we can tap into the Chinese market evolution in the years to come. Industry. As I said, we've kept the ambition similar to what we said beginning of 2024. We are seeing a strong need for quality control, both in food and in pharma. Strong traction in pharma, especially with regards to cell and gene therapy. We've launched GENE-UP for mycoplasma. We are launching SPOTFIRE for mycoplasma for the pharma quality control.

We've just invested into Accellix. That is an additional cytometry solution for pharma quality control. So we are seeing a strong traction that we are planning to keep in the years to come. The two additional segments that are not growth driver, but obviously have an impact on our total sales evolution are BIOFIRE respiratory panel and immunoassays. So BIOFIRE respiratory panel, what we are seeing, as I said, is this high-plex market to not grow as fast as we expected. It used to be a flat sales for respiratory.

We are now expecting minus 5%, which is a combination of a slow price erosion in the range of what we've been seeing in the last couple of years, 1% to 3%, and a bit of epidemiology—reduction of volumes. Knowing that, of course, what is the main driver for RP sales is epidemiology. We've seen it in Q1 2024, very strong sales growth. We've seen it, unfortunately, in Q1 2026, with very strong decline. So that's the main driver for the evolution of RP panel. Immunoassays, very similar evolution. The only addition here is that we include into immunoassay evolution, the launch of SPINCHIP, and we'll come back to you when we are closer to launch, possibly Q4. Launch is now expected in Europe in September.

So that's for the GO for Growth for the next two years. With regards to GO.Simple, a couple of comments here. First of all, in 2024 and 2025, we've actually over-delivered in terms of CEBIT improvement. So we've demonstrated that the different initiatives were actually translating into actual improvement and operational leverage. Now in the context of a sales growth that we expect to be a bit slower than we initially ambitioned, we are looking into adding, accelerating some initiatives, and adding some new ones to make sure that we are capable to bring our CEBIT to a growth that is higher than organic sales growth. It will take additional effort for the organization that we are working on for 2027 and 2028.

The last two dimensions of the plan, Go Stronger. We are still very active. This is a very important topic for us that relates to deployment of core behaviors, core processes, simplification. We still aim to be in the first quartile. We've been there in the last three years, and we're still working to make sure that we continue to strengthen team members' engagement. The last dimension of the GO•28 plan is the sustainability dimension and CSR roadmap. We've updated this roadmap in -- at the beginning, actually, of 2026. So we've kept it unchanged. What's probably most noticeable is we've added an ambition to decline our Scope 3 emissions by 35% in 2034. So the teams are actively working on this, and so far, we are very much in line with the target.

So now closing the call before we get into the Q&A. Key takeaways to share. As you've heard, we are seeing a solid Q2 2026 performance, posting 5% organic sales growth. That allows us to confirm the 2026 guidance. Sales expected to grow between 3% and 5%. CEBIT expected to grow between 0% and 10%. Slight positive adjustment on FX impact, EUR 40 million to EUR 50 million. Most of it has impacted, unfortunately, H1. We are taking the opportunity of this Q2 communication and the stabilization of our performance to update and adjust 2027 and 2028 financial perspective.

So we now plan an organic sales growth to be between 3% and 6%, and a CEBIT growth to be higher than organic sales growth. While we are doing this, we keep investing into the future. That translates into the hopefully soon approval of SPOTFIRE vaginitis , BIOFIRE GI, a new version of panel, the launch of SPINCHIP, and new instruments in microbiology as well as the update of the industrial application solutions with GENE-UP TYPER.

And with this, I think we go for Q&A.

[Operator Instructions] The next question comes from Odysseas Manesiotis from BNP Paribas.

So firstly, on your new '27, '28 targets, they imply a pretty material deceleration in growth from what the midpoint of your '26 guide implies for H2. So you're essentially going from around 7% to 8% to around 4.5%. Could you touch on areas where you may have been particularly conservative? And are there -- is there anything else other than market-wide factors that you mentioned on spending that are driving this in terms of competition, price pressure, even, let's say, Cepheid's upcoming high-plex launch? So that's the first question.

And the second one, regarding what backs your growth ambitions after '28. So you've touched on a few drivers here with SPOTFIRE STI, SPINCHIP, the smaller VIRTUO instrument. I'm thinking -- should we be thinking about a re-acceleration after '28? Is this a bit of a time where you won't be taking as many product launches as usual? Or should we be viewing that '28 post growth trend similar to what we're seeing to '28?

Yes. Thank you, Odysseas. So let me take your 2 questions in order. So the first one that relates to sales growth ambition for 2027, '28. I think the right way to look at it is if you want to triangulate this ambition, I would triangulate with Q2. I mean, obviously, Q1 was very much, as I said, very much impacted by epidemiology. So we still have a low epidemiology in Q2, but it feels like a more solid basis. And in Q2, our sales growth is 5%. So it's actually very close to the midpoint of our long-term guidance. So that's the way I would look at the next few years. So not in a spirit of deceleration, but more in a spirit of continuing the trajectory that we've seen in Q2. And of course, there are upsides and downside versus Q2, a lot of things will happen. But we -- I think it's a solid guidance in a context where we are capable to generate 5% sales growth in Q2.

Your second question relates to evolution of our sales after 2028. Well, I -- that would be the object probably of a new Capital Market Day. I mean, today, we really want to focus on giving you better perspectives on how we are seeing 2027 and 2028. Of course, the investment that we make in innovation in 2026 to '28 will have an impact hopefully in the years to come. So too early to say how we translate in terms of sales dynamics, but the idea is to continue to grow faster than the market in the years to come.

The next question comes from Aisyah Noor from Morgan Stanley.

I'd love to start with SPOTFIRE. So your new guidance of 25% to 40% using 2026 as the jump-off point would imply something like EUR 400 million to EUR 410 million or so of sales by 2028 versus your prior target of EUR 450 million. Would be great to know what the main drivers of this change are? Is it just flu? Or do you see the need to embed more pricing and competition from newcomers to the market?

And then my second question is on instrument sales. So in the last quarter, you called out multiple headwinds from geopolitical uncertainty, pressure on hospital budgets, delays in capital investment decisions. Do you think that the instrument purchasing this quarter was somewhat of a release of that pent-up or pressured demand last quarter? And we're still kind of in a weak demand environment. If you could give us an update on the instrument outlook embedded in your guide, that would be great?

Maybe I can start with the equipment. Thank you, Aisyah. So equipment sales, actually, we saw a good pickup in Q2 at plus 5% overall on the equipment sales, which still leads to an overall H1 equipment sales of minus 7.5% because, again, as you rightly pointed, Q1 was very much down. So yes, it's improving. It's also one of the elements that helps, among others, of course, as Pierre mentioned, to see clearer things on the base of Q2 for the market trend in the future.

And to come back to your first question on SPOTFIRE. So you're right to say that when you apply the midpoint more or less based on the 2026 target that leads us to a little bit more than EUR 400 million, EUR 410 million -- EUR 400 million in 2028. And the main difference is actually exchange rate impact, which as we kept saying in the last couple of years, the euros has been devaluated. It was the only guidance that we are giving in euros. So it was starting to be a bit misleading to give a euro target based on 2023 exchange rate. So to make it simpler and easier to forecast for you guys, we give a progression in percentage like we're doing for the other product ranges.

Perfect. Understood. And if I could just follow up, could you elaborate a little bit on this change in Japan reimbursement or policy change and whether that's a one-off quarter dynamic? Or do you expect it to continue in the second half?

Yes, I can take it. It's actually very illustrative of the worsening of the market conditions I was talking about. We are very successful with SPOTFIRE and BIOFIRE in Japan, by the way, very limited competition from other high-plex competitors. So it's not a market share challenge. It's actually the Japanese authorities are restricting the use of SPOTFIRE panel have decided to restrict the use of SPOTFIRE respiratory panel to "high-risk patients." So it limits the use of this very valuable tool, of course, well bought, but a very valuable place to a smaller patient population, hence, having an impact.

What's a little bit -- so it's unfortunately structural on the one hand. On the other hand, the authorities together with the clinical associations are still in the process of defining what the high-risk patient means. So there was a preliminary understanding that was, for instance, it's only children under 5 years age. But it's not specified in the guidance. And actually, there are high-risk patients. I mean the pediatric association is actually claiming that there are high-risk patients that are above 5 years that should be taken into account.

So there is a bit of a wait-and-see period that is impacted short-term sales evolution in Japan that will hopefully be clarified in the coming months. But the bad news is still there. There is a more restrictive use and coverage of SPOTFIRE panels in Japan. By the way, why we were seeing this overall SPOTFIRE reagent sales have grown 40%. So it was a negative, but overall, we still have very strong performance on SPOTFIRE, overall.

The next question comes from Anna Ractliffe from Bank of America.

Anna? Anna, we do not hear you. Maybe you are on mute. No -- so operator -- yes.

The next question comes from Kavya Deshpande from UBS.

My first was on the 2026 guidance for respiratory panels. If I heard correct, Guillaume, I think you said the bottom end of the range is likely for the Q4 season this year is in line with last year. From the outpatient data we have, it looks like volumes are still below last year even as the comparators have become a lot weaker in the past few weeks. So is there something that you are seeing in your specific inpatient data that is giving you confidence that the Q4 flu season will be at least in line or grow versus last year?

And then my second question was around the nonrespiratory guidance for this year. It seems to now imply an acceleration from about 5.5% in the first half to over 10% in H2. So obviously, also a lot stronger than your medium-term guidance for this franchise. So just curious to know what is driving that and whether that's the new GI panel or something else giving you that confidence there?

Thank you, Kavya. So maybe coming back on the '26 guidance on RP, just to repeat, because you're right, it's an important point. If the Q4 or the season at the end of the year, so Q4 '26 is at the same level as Q4 '25, we would expect our sales to be at the bottom end of the guidance. It's an important precision overall on the range. I don't think we -- there is always this debate on the data during the summer, especially Southern Hemisphere, et cetera. We don't believe that much can be actually derived from summer data in any way to the winter season. So we more look at it in a, how should I say it, simple way in taking assumptions.

Again, if it's -- and that's why we give you if it's at the same level of last year, which was, by the way, special as well. Last year was actually low October, November, super high December. So overall -- let's talk Q4 overall, and that's the color we can give. And we will see altogether if the epidemiology becomes average or stronger by the end of the year. But at this stage, we don't know. Non-RP does imply, you're right, I think your calculation is correct, maybe a bit lower than 10% for H2. And we've seen this acceleration from Q1 to Q2 and Q2 was pretty solid at 7%. So yes, you're right. It does imply a slight acceleration below 7%. We want to be at this level.

It is worth mentioning on non-RP that the cyclosporiasis outbreak in the U.S. is actually detected with a high-plex panel not with mid-plex panels available in the market. So we are seeing a very significant uptick. So we don't know for how long. But in the U.S., we are seeing very strong evolution of GI panel. So of course, non-RP is also depending upon circulation of parasites, bacteria, and viruses. Just to give you a little bit of color of what we're seeing in July.

Just to everyone knows that cyclosporiasis is a pretty severe gastro syndrome of parasite, which currently, as Pierre mentioned, is an outbreak in the U.S. They are talking about more than 5,000 cases now, 5,000 to 10,000, which is the highest outbreak of this kind for many, many years. And again, as Pierre said, high-plex is helping to diagnose, not low-plex.

The next question comes from Charles Pitman-King from Barclays.

Two, if I may. Firstly, maybe just with respect to the FY '27, '28, thank you very much for the divisional breakdown in the presentation. But I'm just wondering if you could give us a little bit more detail on how you think about the gross margin mix development over the period given these new growth mix and tariff expectations, just how you think about that directionally? And then just on SPOTFIRE, a couple of quick clarifications. Can you just confirm there were no one-offs for SPOTFIRE in 2Q supporting that 400? Can you confirm that the meningitis is coming in '28 versus what I understood was a '27 launch? And just any further comments you can give on the LIAISON NES? Any impact from launch initially given this is a concern of investors after their launch in April?

I can take the SPOTFIRE questions and Guillaume will answer on the gross margin. So SPOTFIRE, so first question, yes, confirmation that there is no one-off in the 400. As you know, we commented a little bit in Q1, we had significant one-offs in Japan and in the U.S. with bigger deals. So in Q2, none of this -- the 400 normalized number. Meningitis a good peak. We are now looking into 2028 versus 2027. To be honest, it's still tentative. Maybe it can be accelerated, maybe it can be a bit delayed. So that's why we give overall years. The main, actually the test is what is generating the uncertainty is the speed of the clinical trial. So a bit early, but the latest plan we have is more launch in 2028.

With regards to the competition of LIAISON NES, I mean, what we said when it was announced is it's actually a pretty crowded market already. There are multiple competitors. We have low market share. So of course, a lot of respect for the launch of this new system. And it doesn't dramatically change the competitive environment. We're still seeing -- and actually Q2 is proving we're still seeing SPOTFIRE as a very competitive solution, and there is definitely room for every solution in the market, hopefully a little bit more for SPOTFIRE. For the gross margin...

For the gross margin, thank you, Charles, for the question. But we -- I don't think we, at this stage, give details on the line by line. But what I can say, I think it's important to restate what Pierre has already mentioned is our commitment to deliver on the cost side to have this new guidelines of organic -- CEBIT growing organically faster than sales growth. For that, we commit to deliver on GO•28 initiatives and to launch new efficiency and cost initiatives. We are looking, as we speak, on different fronts. And as you can understand, some will impact gross margin, some will impact sales and marketing, G&A and even pretty likely some will impact R&D. So it's difficult yet to say at this stage exactly depending on our choices, how gross margin specifically will evolve. But I think the most important is our global commitment.

The next question comes from David Westenberg from Piper Sandler.

So I want to talk maybe on SPOTFIRE. How did it do...

David, your -- the line is super bad. Can you do something on your side?

I'm trying. Better now? No?

No. Maybe closer to the mic or...

All right. My mic's on. Can you -- I want to talk about SPOTFIRE and how it did in Q2. Can you talk about maybe new customer wins versus cannibalization? What characteristics do you think is going to make it better than competitors in the coming quarters? Where is the lowest fruit? And how should we think about instruments in 2026 and the impact on '27 and 2028 guidance, if you can hear me?

SPOTFIRE. So I understand your question is on SPOTFIRE evolution of installed base. So there's no cannibalization, as you know, because we are primarily in the point-of-care segment. So we are not seeing any cannibalization with BIOFIRE product range in the hospital setting. So it's all new customers. It's also all competitive wins because in most, 99% of the cases, those clients were already equipped with a point-of-care solution. So that's for Q2 and H1. We don't give guidance on the evolution number of instruments. And usually, what we see is a stronger -- actually Q3 is really the very end of Q3, it's really September and actually a big quarter for us in terms of installation, but it's a market dynamics. It's more in Q4 preparation for the following respiratory season. So we do expect a very similar trend to what we've seen.

Got it. And just on the follow-up on the 2027, 2028 guide. You mentioned you do expect gross EBITDA higher than revenue. You have been growing R&D, but you've been cutting on the SG&A front in the near term. What levers do you have? Like, let's -- theoretically, if you're coming in at the lower end of the guidance in terms of '27, '28, what kind of levers do you think you would use on the OpEx line to make sure that you still can grow EBITDA above revenue?

Yes. But the lower end of the sales guidance to answer your question, probably will take more time to go into details. But if we are at the lower end of the section, it's still 3% to 4% sales growth. So we believe at 3% to 4% sales growth, we still have operating leverage that we can deploy and that will allow to grow profitability faster than sales. So as we are going to prepare for 2027 budget and 2028, maybe we give a little bit more color into what we are planning to do for 2027. But we believe and that's the reason why we communicated this guidance that even at the low end of the guidance in terms of sales growth, we are able to bring profitability improvements together with lower sales growth.

The next question comes from Jan Koch from Deutsche Bank.

My first one is on microbiology. Could you speak about the improvements you have seen in China? Have hospitals started to use more blood culture bottles again? And what are your expectations for China for H2 here? Secondly, on BIOFIRE, Danaher announced plans to enter the high-plex market with its third-generation system. Given the large installed base, how do you view the competitive risk? And have you included that in your new 2027, 2028 targets? And then finally, one clarification on tariffs. Sorry if I missed that, but does your H1 CEBIT include any positive impact from tariff refunds?

Maybe -- this is Gill. I'll take the last one first on tariffs. So yes, to clarify, we did apply for reimbursement of 2025 tariffs that became, I think, let's say, nonconstitutional in the U.S. We did apply, and we got the reimbursement actually cash-wise. And so P&L-wise as well, we have about EUR 13 million of positive impact in our H1 P&L. Yet, I mentioned it's neutral if you compare to 2025 because in H1 2025, the tariffs were not yet in place. We paid in H1 2026 the 15%, mainly the 15% on imports mainly from Europe into the U.S. So between the H1 '26 paid and H2 '25 reimbursed, it was overall neutral and neutral compared to last year '25. I just remind everyone talking about tariffs that we actually manufacture in the U.S. about 85% of what we sell in the U.S., which, of course, gives a relative exposure, a little bit low exposure of bioMérieux to U.S. tariffs. With that, maybe Pierre, on China you want to...

Maybe China to give a bit of color. So Guillaume highlighted, we had a decline of sales by 6%, which is still negative and yet much better than 2025, as you pointed out. So 2 elements. The first one is a bit of -- and we said it when we commented 2025, it was not so much pricing or market share. It was very much a market deceleration. We've seen a lot of stock reduction at hospital and distributors that have a bit of one-off. So now it's part of the improvement. We are now -- we don't have that additional effect that we had in 2025.

The other element is the localization of instrument is working. We have localized the manufacturing of two BACT/ALERT that are available. We are planning to have VIRTUO very soon approved in terms of localization in 2026. We also have localized VITEK COMPACT PRO in China, and we already manufacture locally blood culture bottles. So all of this together has also helped to recover better and be more dynamic in the market. So we are very much in line with the plan that was mid-single-digit decline in China. That's what we've seen in H1, that's what we expect in H2 2026.

Your second question relates to BIOFIRE, the announcement from Danaher Cepheid on their new system. So first of all, it kind of demonstrates the value of high-plex testing in the eyes of Danaher Cepheid. So we are very happy to see that having high-plex molecular solution is acknowledge and recognized by a big player like Danaher. They've announced a new system actually to be able to launch high-plex solution. So we still need to see beyond the system, what are the panels with which performance and targets they plan to have. They haven't communicated any, as far as I know beyond the system, any new panel launch. So when we know better from them, we'll be able to give you more color on how we plan to be competitive against this new system.

The next question comes from Philip Omnou from JPMorgan.

Just on your '26 guidance for your organic growth for 3% to 5%, that assumes a pretty big step-up in the second half to around 8%. Firstly, are you able to share whether you expect Q3 to be within that 3% to 5% or could it be higher? And therefore, how back-end loaded are you assuming the phasing of the organic growth for the year to be? And then secondly, when it comes to your confidence or your visibility in the rest of the business outside of respiratory, how much confidence or visibility do you have in order to hit the low end if flu was below or at the same level as 2025?

And then just a quick clarification on the tariff refunds, please. Can you confirm that the benefit that you saw in this quarter is the full amount that you paid in 2025, and therefore, we shouldn't expect any more tariff refunds to come through in Q3 or Q4?

Yes. So maybe I'll start with the tariffs. Yes, it's almost a full amount of the reimbursement. There's a very small amount of below EUR 2 million that is left to be reimbursed probably in H2. We hope for that. But the bulk of it, as I mentioned, EUR 13 million was actually reimbursed and paid and recognized in the P&L in H1 for the U.S. tariffs of '25. And then if we move to the '26 sales guidance.

So again, I think the most important is to restate what I said again, we are mainly on the trend of the Q2 solid performance that is what gives us confidence on the way we will deliver in H2 and respiratory, which, of course, is the main uncertainty, if we factor Q4 '26 at the same similar level of epidemiology as Q4 '25, we would be around the bottom of the guidance. And let's see where it gets. It can also be stronger. And again, stronger would be for us an uptick on respiratory panels, but also pneumonia and also SPOTFIRE, obviously.

Okay. I'm going to read the question from Anna from Royal Bank of Scotland because she has an issue with the headset. So she would like to have an update comment on your view on competitive positioning on both BIOFIRE and SPOTFIRE across both technologies. It seems like competition is increasing. Second question, looking beyond 2028, specifically for SPOTFIRE, how do you see the balance of increasing competition versus your non-RP launches driving an acceleration in growth? And the last question is for the midterm, sorry, CEBIT downgrade

[Audio Gap]

from inflation, oil prices that will be at high levels for the midterm.

Okay. So let me start with the first one, competitive positioning. I guess -- then I talk about beyond '28 and Guillaume will take the CEBIT evolution. So competitive positioning, it's a broad question. Let me say it this way. What we are seeing for BIOFIRE, and I said it a little bit when we were sharing the perspective was that we are not seeing a significant degradation of market share in respiratory panels or nonrespiratory panels. We're seeing price erosion. We're seeing market share erosion, but the assumption that we had in 2024 are actually proving to be very correct at the end of June 2026.

So I know it's been a very regular question and challenge raised by -- in the context of competitive launches. We're actually seeing a very decent performance. And actually what drives the evolution of sales is very much related to epidemiology for respiratory more than competitive challenges. So that's what I would say for BIOFIRE. And of course, we've tried to integrate the evolution of the competition in the revised guidance. It's a best estimate of what we're seeing for non-RP, we're still expecting to grow 4% to 8% in the years to come, given this what we believe is a superior system in the market with the broadest menu and a very strong install base. And that, by the way, keeps increasing in H1 2026.

With regards to SPOTFIRE, again, very different picture because in this case, we don't have a high market share to protect. We're actually taking share. As I said, the competitive environment is a little bit less sensitive to us because we are more in a market share uptake. As I said, we are very much in line with the plan. As you pointed out, there are new competitors in the market, but it's a huge market in the region of EUR 3 billion to EUR 4 billion market. We're still a very marginal player in this market. So we believe there is ample room for growth in this market with the caveat of we are getting more and more depending upon the respiratory season because it's mostly respiratory disease, which is a good segue to your second question, post 2028, probably it would be -- if and when we do a new Capital Markets Day, it would be a good topic.

As we said, until 2028, the impact of vaginitis, STI, and meningitis disease is included in the guidance for 2028, but it's not very significant yet. But of course, as we move forward and we believe and we aim to bring very differentiated solutions for vaginitis, for STI, for meningitis. So we hope to take share in this point-of-care market. So that is aiming at taking -- derisking, if you wish, from respiratory season on SPOTFIRE in the years to come. I'm not in a situation to give you now any order of magnitude of number beyond 2028. Midterm CEBIT evolution, Guillaume?

So on the CEBIT evolution, lower than the previous targets of the plan. Top line is definitely a major impact, of course, especially in a high-margin business as we have. So of course, 3% to 6% growth has a major impact on CEBIT compared to [indiscernible] I mean, average 7% CAGR. And also, you're right that as we mentioned, the macro environment is not the same as it was back in 2024. Tariffs, just to mention tariffs in the U.S. of 15% were not present at the time. We base our case on the current, and that's very difficult, the current oil price, which is slightly below $100 per barrel, and it was absolutely not the same environment before that.

We can mention on inflation also the chips, electronics, let's say, we say crisis, which is actually the drag of AI data centers on the whole world of which makes it more difficult to source and much more expensive to source as well for our own equipment, and I can continue like that. So I think our new guidance takes into account this new context as we know it today, of course, we don't factor any new macro environment or new war or anything like that. But at least the environment, as we know it today, that is so different, as I just mentioned on the cost side as well from what we saw and we had back in early 2024.

And just Anna, just one follow-up question for 2026. For the 0% to 10% CEBIT evolution in 2026, are you able to comment on what will drive you closer to the upper or lower end of the range? How much will it be dependent, sorry, on operating leverage mix of respiratory season?

The main dependency as usual at this stage of the year is definitely on the strength of the respiratory season. This is how we explain what drives the top line in the range. And definitely, that's what will drive the bottom line. Q2 the mathematical calculation, which obviously is a bit limited, but still relevant. If H2 equals Q2, i.e., if we grow 5% in H2, we would be at 3% sales growth for the full year. So that kind of builds a bit the bottom of the guidance, if you wish. And to Guillaume's point, then of course, we are very dependent about the respiratory season. But as we said, respiratory season 2026 Q4 equals respiratory season Q4 '25 would give us 3%.

To take one question from -- written questions. So one question from Christophe-Raphael Ganet on the price. The question is on industrial applications, but I'll be a bit broader to recap on pricing effects. So industrial applications, to your question, was able to increase price by slightly less than 2% in H1. We also are able to increase price in microbiology by around 2% which actually makes price increases in about 50% of our overall portfolio and sales, whereas on BIOFIRE, we decreased about 1% prices on nonrespiratory overall and slightly less than 3% -- less than 3% price erosion on respiratory panels on BIOFIRE. So again, 50% with price increases, about 40% of the portfolio with price -- slight price decreases. And by the way, when you look at the whole overall price effect on bioMérieux, it's therefore, pretty neutral in H1.

Okay. Let's go for maybe 3 extra written questions. The first one the question is the 3% to 6% annual growth target or an ambition?

I think it's important to restate what is actually the way we wrote it in the press release is that we are aiming at delivering 3% to 6% organic annual growth. And then you can -- I mean, that's our wording.

Maybe one question from Arnaud Cadart from CIC. As you mentioned with the revised guidance for '27 and '28, the market is less responsive to innovation while maintaining intact the R&D initiatives?

Well, actually, we don't keep them intact. We keep reviewing R&D portfolio to make sure that we adjust the innovation that we launched to the market conditions. So we -- our objective is clearly to reach by the end of 2028, very much in line with the GO•28 plan, 12% sales research and development. Now it's more what is it that we bring in terms of innovation that will resonate best in terms of market acceptance and affordability of the market is obviously a big topic for us. And of course, we are looking at a portfolio of innovation taking into account this new environment.

And maybe just a second question from Arnaud. Could you update us on the launch of SPOTFIRE in France?

Yes. So as you know, in France, there is a point-of-care market that is formally organized. But what we are capable to do is to launch SPOTFIRE in the hospital environment. So it's mostly available to emergency departments. The first -- there are 2 new news. The first one is we've actually got the approval for Europe of the low-plex SPOTFIRE for respiratory that was not available in Europe yet. It was launched in Q2. So we expect it to further expand in Europe and of course, in France.

The second new news that relates to France is there was a decree that allows to do

[Audio Gap]

elderly houses or "maison de sante" in French. I don't know how to say it in English. The decree is out, but there is no funding. So as we speak, we are working together with authorities to see how we can organize for a proper reimbursement for that kind of solutions outside of the hospital setting.

And maybe the very last question from Thibault Lechevallier from All Invest. Should investors expect bioMérieux to play a more active role in industry consolidation in order to strengthen its medium-term growth profile?

Well, our view on M&A stays unchanged. One, we keep looking at what we call bolt-on opportunities to further strengthen our portfolio of solutions in the core segments where we operate. Accellix or SPINCHIP or Neoprospecta are recent illustration of what we do from an M&A perspective. And of course, if and when we see adjacencies, additional segments where we believe we can acquire strong position, this is something that we keep exploring, but they need to be strategically and financially reasonable. So no pressure that relates to this evolution of midterm guidance.

Okay. So thanks a lot. Thanks for your questions and your participation to this call. And our next touch point will be on October 30 for our Q3 sales performance.

Thank you, everyone. Have a good day. And good summer break.

Bye-bye.

Welcome to the bioMérieux 2025 Third Quarter Sales Conference Call. The call will be structured in 2 parts. First, a presentation by bioMérieux Group management team. [Operator Instructions] I will now hand over to Aymeric Fichet, VP, Investor Relations. Please go ahead.

Thank you. Good afternoon, good morning, and thank you for joining us to review the Q1 2026 bioMérieux sales performance. I'm online with Pierre Boulud, CEO; together with Guillaume Bouhours, CFO. Please note that this conference call will include forward-looking statements that may change or be modified due to uncertainties and risks related to the company's environment. Accordingly, we cannot give any assurance as to whether we will achieve this objective. I also remind you that today's call is being recorded and that a replay will be available on our website, www.biomerieux-finance.com.

I will now hand the call over to Pierre and Guillaume, and then we will open the call to discussion and questions. Pierre?

Thank you, Aymeric. Good day to everyone. So let me start with a few general messages before I say a few words about the guidance. We have dealt with a pretty complicated environment in Q1 with a very weak Q1 respiratory epidemiology versus what we already knew was a strong Q1 '25 and a challenging geopolitical environment that has driven softer customer demand, especially for investment decisions.

So it has translated into a 3.9% overall sales decline in the quarter that's in line with the environment I was describing driven by weak respiratory sales, minus 23% in respiratory panel and a general softness in demand, especially for instrument sales that are posting minus 18% in Q1. Despite these challenging market conditions, we have actually continued to deliver in Q1 2026. If we look at GO•28 growth driver reagent sales, we've grown 6.5%. I would like to highlight SPOTFIRE reagent sales growth, plus 31% in Q1 in spite of the very low respiratory season and high single digit, plus 8% for industrial application reagents.

We've also continued to deliver from an innovation perspective with the CE marking of SPOTFIRE, the immunoassay in March that will allow us to launch in Europe in the low-plex molecular respiratory market. Mycoplasma on SPOTFIRE for the pharma quality control. We filed Hs-TnI SpinChip as forecasted in January. And we've also acquired Accellix that will further support and strengthen the portfolio of solutions that we offer to our pharma clients. Finally, we are progressing well with the vaginitis panel and still expect to submit to the FDA by Q2 2026.

So in light of this Q1 performance and this very uncertain geopolitical environment and since the last time we talked, we had the Middle East event that started on 28th of February, we have decided to review downwards our 2026 guidance, which is now, as you could read, 3% to 5% growth of our sales at constant exchange rate and a profitability improvement from 0% to 10% at constant exchange rate again. Maybe 3 qualitative elements that I would like that you consider moving forward. First of all, we have a much lower base effect starting in Q2. And for instance, we had a growth last year of the respiratory panel that was 21% in Q1 and then it declined by 6% from Q2 to Q4. So we have a much easier basis for growth.

The second element is we are seeing very consistent commercial dynamics, complicated to read the market share, but we are looking at win rates across our franchises. We have very strong and consistent win rates. And finally, we are obviously in this challenging sales environment context, we are looking at strengthening our cost control initiatives, and we will continue to deploy and if possible, accelerate the ongoing implementation of the cost-saving initiatives.

So with this, I turn to Guillaume that will give you more color on the Q1 performance.

Thank you, Pierre. Hello, everyone. So let's look at a bit more details on Q1 sales. So overall, Q1 sales at EUR 984 million, organic evolution of minus 4% and a total decline of minus 10%, including a negative FX of EUR 73 million, notably driven on the top line by the weaker U.S. dollar or stronger euro.

Just remind you that last year Q1 dollar was EUR 1.04 against euro against EUR 1.18 in Q1 this year, so quite a change. As said by Pierre, Q1 performance was mainly impacted by the weak respiratory and weak instrument sales on respiratory, so down 23% in Q1 due to epidemiology, which was significantly lower compared to Q1 '25. Q1 '25 was exceptionally high. And when we say lower, there are 2 effects. There is the effect of lower number of cases, which I think everyone can see in the public stats, if you look at the CDC stats or others. But beyond the number, there is also lower epidemiology in terms of intensity. What we mean is that we saw from a medical point of view, more flu B circulating notably, which also means less acute cases and less hospitalization overall.

Weak instrument sales, minus 18% overall on all our ranges together, again, that we believe is also linked to the geopolitical turmoil driving this, let's say, softness in demand, as Pierre mentioned. Overall, our GO•28, 4 growth drivers on reagents were up 6.5% on an organic basis. So if we look at them one by one, BIOFIRE non-RP is up 4%. And if we drill down in some of them, not to go through everything, but it's interesting to note that we have on pneumonia, negative evolution, minus 2% despite the fact that there is absolutely no competition. We are the only high-plex player with this panel. So the evolution is, of course, driven by the epidemiology.

On the other hand, for example, blood culture, which is also an important panel in our menu had a strong dynamic, double digit despite the fact that we have competition on this panel on the high-plex segment. Also to note on the BIOFIRE that we continued to expand, so we don't give quarterly figure, but we can give a trend, continue to expand the installed base on a net basis over the quarter. And finally, just a note on nonrespiratory panels prices that we had a slight erosion, very similar to last year, about 1.5% in Q1.

Now turning to SPOTFIRE. So as Pierre mentioned, I think the key figure is 31% organic growth on the reagents despite a super high comp base, of course, of epidemiology last year. Just to remind you, last year, Q1, SPOTFIRE was 166% growth. We had overall a solid we believe solid instruments installation in the quarter, plus 450. And we say solid because actually, when we take one-offs away, it's pretty much in line with the high comp base of Q1 adjusted. I say adjusted for the one-off in Japan. You remember that last year, there was a government subsidy, especially at the early start of the year in Japan for acquisition of point-of-care or SPOTFIRE. And also, we had one very significant strategic deal in the U.S. in Q1 last year. So taking out those 2, we are pretty much aligned with Q1. Overall, the installed base is now close to 7,000 instruments. And looking at a 12-month rolling basis, the installed base is up 55%.

So overall, SPOTFIRE performance remains driven by the continued expansion, notably in the U.S. and in Japan. Turning to microbiology, which is 1/3 of the GO•28. Overall, 2% growth, which for us is in line with our expectations internal for Q1 for reagents. The range overall was still impacted by China. China microbiology was down 7%, but you remember from our previous discussions on China, it's approximately in line with our mid-single-digit decline expectations for China micro in '26. And also instruments on microbiology instrument sales were down 12%. When we exclude instruments in China, microbiology is up 4% on reagents, with notably a strong dynamic on blood culture bottles.

Industrial Applications, the fourth growth driver of GO•28 at plus 5% organic for the quarter, also impacted by, again, the softness and decline on instruments, but we believe a good performance on reagents, up 8%, as Pierre mentioned, on our pharma and food customers. Finally, so not in the GO•28 drivers, but to mention immunoassays, as you could read a negative performance, but I would say, in line with the guidance. Some elements on the new sales guidance that Pierre mentioned. If we think about it by range, it's interesting to, let's say, highlight for you that we see actually no change on microbiology, 3% to 5%. No change on our prospect for the year on industry applications, 7% to 9%. No change on immunoassays, still in the range that we had given of minus 5% to 0%. Of course, we have a major adjustment, and it's most on what is coming from respiratory that impacts BIOFIRE, which now we see more around minus 8% to minus 3%. Second, of course, respiratory impact is on SPOTFIRE that now we see more around plus 40%, around plus 40%. And we have a slight change on the overall non-RP growth, which we would see around 8% instead of the previously mentioned around 10%.

Before moving to the Q&A, just an update on 2 topics, Middle East events, of course, their impact on bioMérieux and foreign exchange impacts. So on Middle East, bioMérieux has mainly 2 exposures, of course, one on transportation costs and the impact of the oil prices, be it our own transportation, of course, the supplier transportation and the way they factor that in their prices. The impact on the transportation, we estimate is close to EUR 1 million per month at the current level and if it were to be sustained. We have a second impact, which is, let's say, could be significant is on plastics. A lot of our -- so plastics is impacted by oil prices, of course, it's derivatives. And -- but most of our instruments and reagents contain, let's say, plastic raw materials in one way or another. Resin prices are already up, but at this stage, their impact, if any, would be deferred, thanks to the level of inventory that we hold.

On FX, as you've seen, we have confirmed the guidance of about minus EUR 50 million to minus EUR 60 million negative impact. Unfortunately, the euro was, let's say, strong up to February, decreased in March, which was probably better for us, but actually rebounded with a strong position, exactly the same as early in the year in the last few weeks.

And with this, I propose we move to the Q&A session.

[Operator Instructions]

The next question comes from Odysseas Manesiotis from BNP Paribas.

Firstly, on reiterating the microbiology guide of 3% to 5% for the full year. Could you help us understand what will help you accelerate growth so materially from Q1? I understand VIRTUO has launch a competitive instrument for what's quite a material part of your franchise here. Could you also explain whether you have any concern on the back of that launch?

And my second question on the FX. So the others, as in the other currency portion in terms of the headwind seems higher than previous years, and you've had a few favorable moves on the dollar, for example, since the start of the year, as you noted. Could you explain to us what key currencies with others contain that have been particularly a headwind for you this year?

Thank you, Odysseas. I can start with the micro question and Guillaume will follow up on the FX. So microbiology, we are actually very confident with the guidance. And as Guillaume highlighted, we haven't changed it to be transparent with you, actually, reagent sales performance in microbiology is very aligned with what we plan to do in Q1. There was a little bit of impact in China last year. There is a little bit of phasing base effect. So we are -- yes, we are seeing -- we are very confident we can achieve it, and that's the reason why we didn't change.

With regards to the launch of a new system by VIRTUO. As you know, it was announced actually a long time ago. It was -- so it was well embedded into our plan. And we -- no reason for us to change anything with regards to -- we believe we still with VIRTUO have very competitive solutions in terms of time to result, loaded automation for getting the bottle shield. So yes, it's no change with regards to microbiology for us for the rest of the year.

Coming to FX, so definitely worth looking at it together in more details. So first -- on the currencies. First, on the U.S. dollar, it's important to remember, it was very volatile last year that Q1 last year had a strong U.S. dollar before U.S. dollar weakened very significantly from, I think, end of March. So there's first effect when we compare year-on-year in Q1 and for the year.

Then the major impacts on our EBIT year-on-year on currencies like the yen. The yen continued to be super weak compared to euro. The Indian rupee, which is a significant country for us, also a pretty significant change, about 10% from last year. And then we have the high inflation countries, as usual, Turkey and Argentina, who are the next ones in terms of impact.

The next question comes from Kavya Deshpande from UBS.

I have 2, please, both on sort of guidance approach. So I mean, just to start with, not to state the obvious, but you gave us guidance at the end of February, and you've been speaking to the market through March. But just a few weeks later, the new guidance is obviously very, very different and actually much lower than Q1 performance alone would have implied.

So my first question is, and you've already sort of done this, but would you be able to describe, please, in more detail as to the key things that have changed in such a short amount of time that have made you revisit your full year assumptions beyond just the Q1 performance? And then my second question is, if there has been such an extreme change, it might suggest that visibility isn't great right now. So how risk-adjusted is this new guidance in your view? Why is this now the right level?

Thank you, Kavya. Let me start with this. So we have -- I mean, when we shared the guidance for the year, we have now 2 more months. I mean we had 1 month in [ advance ] of sales. Now we have 2 more months of visibility. There are 2 elements that led us to review the guidance downward. The first one is the respiratory season has been -- we were expecting a weak respiratory season. It's been very weak. And unfortunately, you only know it at the end of the respiratory season, right?

So we kind of witnessed that March was not getting any better versus the beginning of the year. The second element is we've seen a very slow market in demand for instruments at the beginning of the year and the recent Middle East event that started on the 28th of Feb have actually further slowed down investment decisions that were made by our clients. So taking that into account and out of sake of transparency, right, for the market, we felt that achieving the guidance, the top end of the guidance now at the end of the previous -- at the low end of the previous guidance, and we feel it's a better recognition of what's happening.

Very recently, in the U.S. the President announced that he wanted to increase the military spend by 50% and reduce health care costs. I mean these kind of things have an impact, of course, on sales, and we wanted to acknowledge that in the context, as you mentioned, of high volatility, right? So we believe that with this new guidance, we actually better integrate the uncertainty that is happening in the market as we speak.

And then on the risk-adjusted and the visibility, definitely, the environment is not simple. That's why we highlighted the external factors. But we believe that we have the right, let's say, range of risk-adjusted -- risk adjustments on the upside or downside, be it on the top line, 3% to 5% or be it on the EBIT, knowing that, of course, on the operating margin, it's also up to us to trigger the different initiatives that Pierre mentioned, the ones that were existing on GO•28 as well as the additional one that we will launch.

Appreciate that. If I could squeeze one more actually. Just on the factoring in of the respiratory season being worse than you expected, so the new BIOFIRE RP guidance, the bottom end has gone to minus 8%, if I heard right, from minus 3% previously. But obviously, Q1 alone wouldn't have justified that and the CDC data hasn't halved dramatically since you did the old guide. So is the right way to understand this is just that you're deciding to have more contingency when you think about the Q4 flu season?

Obviously, it's very hard to model and we don't have any data, but is this basically a more prudent approach than what you've taken a few weeks ago? And then related to that, in terms of how you're looking at China, your China guidance for declining mid-single digits, that was a buffer guidance, as you said earlier, it was sort of a contingency guidance. Are you still happy with the prudence with which you've guided on that business?

Just on RP to rephrase, maybe I was not clear. Inside our new guidance, it's a range of minus 8% to minus 3%. So it's around minus 5%. Of course, if you take just the downside. And of course, as usual, it's an uncertainty on especially Q4 as usual. So that's important to restate on RP. And just you mentioned, I just want to reexplain because you just referred to the stats. Of course, the stats are very key. The stats are on influenza like illness, so the different types of respiratory topics. What we see specifically this year on top of less cases is less acute cases. And you know that our products are really for hospital acute cases mainly.

And again, medically, we understand that it's less flu A, more flu B for that kind of effect. But definitely, less cases and less acute cases in those cases.

And maybe to answer the China question, we actually have -- we haven't changed either our forecast for China. What we're seeing is actually consistent with what we expect mid-single-digit decline. Yes, everything that happened in Q1 is very consistent with that. So we don't -- I mean, there is an element of volatility in China, as you know. But as we speak, what we're seeing is very consistent with our initial guidance for China. No specific buffer or no specific downside.

The next question comes from Aisyah Noor from Morgan Stanley.

My first one is on the instrument weakness, where you called out 18% decline for the quarter. So by my math, your instrument sales is only about 10% of group sales, which means that, that EUR 20 million or so shortfall should have been entirely driven by the SPOTFIRE instrument decline. Can you confirm if my math is right? And actually ex SPOTFIRE, the instrument growth is more like flattish? Or are there other segments where you also saw a decline in instruments?

The second question is on the GI panel, which I noticed you didn't comment on in the press release for nonrespiratory. Can you confirm that GI panels were also growing double digits? Or is it the case you might have seen a slowdown post Cepheid's GI Panel launch this quarter?

So on instrument weakness, just to recap, no, it's not just SPOTFIRE, especially SPOTFIRE on our main market. Of course, U.S., it's about placement. You're right, of course, there's the base effect of the government funding in Japan last year, which were sales of SPOTFIRE in Japan last year. But even when we exclude that, it's still a very significant double-digit decline on instrument sales. And this is what I mentioned on microbiology instrument sales as well as industrial applications instrument sales that are both significantly down.

And with regards to GI panel, the competition with Cepheid is a little bit different because it's a mid-plex panel. So it's more competing with lower kind of plex panel. So it's a perfect example in terms of competition for us. That's the reason why we didn't take it. The Cepheid impact at this stage is not visible to us.

Okay. Okay. And if I may just follow up, I wanted to push a little bit on the guidance approach, and this is more specifically on the midterm guidance approach. I think it's fair to say the market has been very volatile, and we've seen some challenges that are quite unprecedented for you, and you've had to lower your guidance 3 times now in the last 12 months. So I appreciate it's only the first quarter of the year. But I guess what triggers or deterioration would you need to see for you to think the GO•28 targets might need to be revisited given that the lower end of your new guidance could make it a bit harder to achieve?

Yes. Thank you, Richard, for the question. So first of all, what we're seeing, which is very unchanged, is good market share dynamics. We're seeing, be it microbiology, be it with BIOFIRE, be it with SPOTFIRE, win rates, capacity to take share or to protect share in the case of BIOFIRE is still very strong. I think it was confirmed in 2025, and it didn't change overnight between the 31st of December and the 1st of January. So it's still there. We are seeing that very positively.

What we're seeing deteriorating is the market evolution, be it respiratory season, be it a slowdown of the IVD market. It was very striking in 2025. And again, in 2026, it's very striking. So it's -- the challenge for us is in a context where we are seeing a commercial performance that is very strong to adjust to a market evolution where cost of IVD and we're seeing it for other players are actually being challenged by the customers and they are really looking hard at controlling better their costs. So the third element is we are seeing, to your point, the very -- the high range of the guidance, 5% sales growth, 10% EBIT profitability improvement, very much in line with long-term GO•28 target.

So we confirm the guidance for 2028, and this is where we are, even though we acknowledge that 2026 is a tougher year, and we've seen a bit of a slowdown of the market evolution starting in 2025, to be honest, but continued in 2026.

The next question comes from Jan Koch from Deutsche Bank.

Firstly, I would like to better understand the impact of the Middle East conflict on your instrument business, especially for microbiology and industrial applications. So how did instrument sales evolve throughout Q1? Specifically, were January and February significantly better than March? And have you observed any changes or trends in instrument sales in April?

And then secondly, on SPOTFIRE, one of your competitors has partnered with the same distributor. Does this have any implications for your future placement expectations?

So let me start with the second question, SPOTFIRE, McKesson. The short answer to your question is no. McKesson is a main distributor -- only distributor actually for SPOTFIRE in the U.S. is also distributing every other diagnostic solutions from main competitors. So we don't see any change in terms of market conditions. And to be honest, with SPOTFIRE, unlike microbiology or BIOFIRE, we have still a relatively low market share. So the competitive environment is -- and there are already significant competitors in the market with different players. So we are not seeing a significant change in the competitive dynamics, and we've not seen that either in Q1 2026.

With regards to Middle East impact, maybe you can -- in terms of sales. Yes. So again, it's around 2% of the total sales, Guillaume.

It's our view that -- again, just to recap, in our minus 18%, there of instrument sales in Q1. There is a share that was expected actually linked to the one-off of very high SPOTFIRE sales in Japan last year, et cetera. Excluding that, it's still double-digit instrument sales. So that's what we are talking about that we see notably on microbiology and industry applications. And again, it's across the board. We see and we get direct feedback.

So really a wait-and-see mode from customers on -- in this new environment, is it the right time to launch a reorganization of the lab, rethinking of their installed base, which sometimes, by the way, can be positive for us because it means they actually continue with what they have, which, of course, with our high market shares is always nice, but also the renewal are opportunities for equipment sales and sometimes, of course, competitive wins. So that's what we saw. And no, we -- yes, we have not seen any change throughout April at this stage.

And one follow-up, if I may. So did the instrument business also declined in the double digits in January and February prior to the war starting?

We don't give these details. But again, we see that linked to the war and overall the geopolitical environment, which -- because there is a war, but there's also -- and I think Pierre alluded to it, the overall -- and that was before it started between Iran and there is also the global shift on government's focus on defense spend versus health care and in different ways in different countries and said differently, let's say, pressure on health care spend, which means for the hospitals, our key end customers additional pressure.

The next question comes from Natalia Webster from RBC.

I have a couple, please. Firstly, just a follow-up on the instrument weakness across the various segments. Is this something you're assuming will continue for the remainder of the year within your guidance? And are you then assuming this will improve from 2027 to hit your GO•28 guidance?

I appreciate the geopolitical situation and the one-offs with SPOTFIRE, but I would appreciate your comments on that. Secondly, on BIOFIRE Respiratory, you commented on the non-RP erosion. Is your pricing erosion on the RP side still fairly limited here?

And then thirdly, on the EBIT guidance range of 0% to 10%. This is fairly wide, and I appreciate the different levels in revenues. But are you able to comment on the key levers of reaching the lower to high end of this range and where the main cost flexibility sits?

Okay. So maybe I'll start with a comment on the instrument phasing. Guillaume can take BIOFIRE pricing, and I'll take over for EBIT evolution. So, no, we are seeing the slowdown that we are seeing for instruments. I mean we have -- in our guidance, we expect that it will not slow down forever, right, and which would not work. We have a few elements that make us think that it will get better as we move forward. So we are seeing -- in the guidance, we are seeing an opportunity for still coming back to a better level of sales for instruments, which has an impact on total sales, but also an impact for future reagent sales, right? So we have -- we are comfortable with the guidance that we gave with regards to instruments. We've kind of included the hit that we saw for the first few months of the year. On pricing -- on respiratory.

On respiratory pricing, Q1 was -- we are around minus 3%, slightly lower than that, actually, slightly less than that, 3% price erosion, which is a small acceleration compared to last year. We definitely adjust on -- yes, where we need, we feel we need to in a clear direction of customer retention. So nothing dramatic, but the same kind of low single-digit level.

And your final question was on EBIT new guidance that we gave between 0% and 10%. So of course, it's impacted by the level of sales, right, because we have a volume of fixed costs. So when you lose sales when you get to 3%, it's -- we have significantly less gross margin than when you get to 5%. So that explains a significant share of the EBIT. Having said that, as you know, with GO•28 plan and GO Simple, we have actually been able to deliver above targets, both in 2024 and in 2025. So in this more challenging context from a sales perspective, of course, working diligently on executing the [ GO•28 plan that is for 2026 ] and even accelerating them in that complicated context.

And moreover, given the market softness that we are experiencing, we are launching new initiatives, additional initiatives, be it on spend, be it on headcount to be able to control the cost evolution and make sure that we are capable to generate profitable growth even if the sales growth is a little bit slower than what we expected.

Just a quick follow-up on the BIOFIRE RP erosion. Are you assuming this to accelerate into '27 and 2028 within your GO•28 guidance given further competitive pressures?

No, it's a kind of level that we feel is a more, let's say, normal recurring level of, let's say, pressure or said otherwise, of adjustments that we are ready to take. It's been in the same range for the last 2 years. Actually, it's around 2%. So that's the kind of expectation that we have moving forward.

The next question comes from Charles Pitman-King from Barclays.

A couple from me, please, on your kind of regional impact. Just coming back to this conversation around Middle East sensitivity. Thank you very much for kind of clarifying the exposure to transportation and oil costs. But just when we're trying to understand a bit of the sensitivity for plastic price movements, I wondering if you can give us an idea of kind of how many months of inventory you hold, like at what point could this start to become a problem to your underlying costs?

And are you able to give us any indication of the level of COGS that plastics kind of represent so that we can try and run that sensitivity? Then the other kind of regional question I've got is on China. Just noting some of your peers highlighting the potential expansion of VBP programs. I'm wondering if you could just comment on your exposure there. Apologies for any ignorance.

And then just lastly, if you could just speak a little bit around your outlook for instruments this year. I'm just wondering if you are able to guide at all on whether or not you expect SPOTFIRE new installations to decline year-on-year as a result of this new hesitancy of customers.

So on Middle East sensitivities, thank you. So you got it right, definitely, we have resin plastic price impact. Again, we hold several months, actually several quarters of inventory, us and sometimes even sometimes our suppliers hold the raw material of inventory of resin price. So the impact would be delayed. And again, the -- I would say, when we say in the guidance, excluding prolongated Middle East impacts, it's a fact that first, the level of the impact, where will be the oil price in 2 weeks or in 2 months, I mean, we don't know up or down and also the duration.

As we all know, nobody has a clue if it's going to last for 6 months or another 3 weeks, the war. So we kind of let's exclude kind of the second half. But just to still give you an idea of what it means. I mean, if we were to have exactly the same level of oil price and plastic for up to the end of the year impact of transportation and resin, it would be like EUR 5 million, EUR 10 million on top, which again doesn't mean much because it will go up or down, it will stop at some point. But if you just draw the line, it would be EUR 5 million, EUR 10 million impact additional in H2, just to give an idea.

China, so maybe I can share on China. There is indeed a new regulation that is organizing the billing of the hospitals to the health care system for diagnostics, which could translate into potential revision of prices at least for some provinces. I think it's still a draft at this stage. What we've seen on our side, as you know, in China, 90% of our sales are in microbiology. This new draft pricing organization or billing organization for the hospital is actually not unfavorable for microbiology testing.

As you know, microbiology is still relatively not as developed in China as it is in other countries. The billing mechanism actually differentiates in microbiology, culture, identification and AST antibiogram. So we see it as a pretty sophisticated even favorable way to -- for the hospitals to build microbiology tests. So it's definitely not a headwind for us. We obviously are watching the evolution. Again, it's still draft. But for China, not -- we don't see it as a negative for us. And SPOTFIRE installations or installation in general, we usually don't give guidance on installations. And on top of that, you have a seasonality effect.

As you know, usually, Q2 is lower and it gets bigger in Q3 and Q4. We have also the impact that Guillaume was describing. Sometimes even for SPOTFIRE point of care, we signed big deals like IDNs who want to harmonize their point-of-care testing, and that's what we did in Q1 last year. So this kind of deal can happen. So it really makes the phasing of new instruments, installations very complicated to give to the market.

The next question comes from Anna Ractliffe from BofA.

I wanted to ask a follow-up on what I was kind of getting at on the GO•28 targets, but more specifically on the SPOTFIRE EUR 450 million target. I guess what is underpinning your confidence there that that's sufficiently risk-adjusted? And if instrument placements remain a bit slower at this pace, how much of that is a risk to the target? And then on the 2026 0% to 10% CEBIT growth guidance, can you just walk us through a little bit more details on what gets us to the high end versus the low end for this year?

Okay. So I can give it a start Star. So GO•28 target, especially for SPOTFIRE, EUR 450 million. We are -- we are very comfortable with where we are, be it as Guillaume was saying, we're already at 7,000 units installed now for SPOTFIRE. We are growing our reagent sales by 30% in a context where with the weaker respiratory season has declined sales for respiratory by 20%. So there is a huge impact of the respiratory season that makes extrapolation of Q1 really impossible for EUR 450 million. And as I said, we are working diligently and doing a lot of good progress on preparing the launch for new panels on SPOTFIRE.

So all of this together really makes us as confident as we were with the EUR 450 million target for 2028, no change in that regard. With regards to 0% to 10% EBIT, I tried to give a little bit of perspective before it's driven by sales and the gross margin. And that's the biggest impact. And what we are working on is to make sure that we are launching, as we speak, additional productivity measures to be able to compensate the sales decline and still be able to generate profitable sales growth in a market that has proven to be very slow in Q1. So -- and it goes across the bar. So I don't think there is -- not too early, but not the right forum to discuss the details of the productivity measures we are taking, but we are definitely active to adjust the cost base to this new sales and top line.

Okay. So we have some online questions. The first one from Christophe Ganet from ODDO. So 3 questions. The first one is on BIOFIRE RP looks a bit low compared to your guidance. Is there an issue of commercial execution or any loss of sales reps?

Any issue about competition, an issue about real commercial potential assessment, price postponement in order where is the miss?

Second question is on BIOFIRE, which looks below expectations, I think, in terms of -- can we have the level of consumption per machine SPOTFIRE or any reason explaining those 450 systems?

And the third question is, in [ IMU, ] what is the proportion of commodities and non-commodities test now, your view on the evolution plus any update on the TB test?

I'll start with non RP or I'll start with first question. So I mean, the short answer is we -- honestly, we don't see, especially in this market, right, which is not shifting that much. We have very strong commercial execution in Q4 2025, growing above 10% actually in Q4. As Guillaume highlighted, pneumonia panel where we have no competition, 0 competition, we declined by 2%. It was one of the high growth drivers that we have.

So yes, of course, we are very vigilant, and we are looking carefully by country on cross-selling, win rate and so on and so forth. Honestly, we are not seeing any disruption with regards to the competition. So we are disappointed with the number, of course, and we see it as mostly explained by epidemiology and the very slow market conditions.

The second question that relates to SPOTFIRE. So we don't give the level of consumption per instrument for a variety of reasons. It depends very much on the setting, if they're in a point-of-care setting, if they're in hospital triage setting. It also depends on consumption, of course, with respiratory season.

And just to reexplain that we are not disappointed. I understand the consensus was above the 450, but actually, there might be kind of, I don't know, a special perception effect because our Q1 '25 was very strong. Q1 '25 included, again, Japan, again, very strong additional SPOTFIRE based on government. It also included a one-off pretty significant U.S. deal, and there's not that kind of large-sized deals every quarter. When we look ourselves at Q1 '24, Q1 '25 adjusted and actually Q1 '26 is very much aligned. And Q1 is not a very strong quarter by itself. It could be if epidemiology is strong, some customers actually add capacity during the quarter, which, of course, did not happen this year, obviously. So yes, I think that's our analysis or view of the dynamic.

For us, and I understand the read of the market, but for us, not a disappointment. It's -- we know Q4 is actually the highest month in terms of installations. It goes on in Q1, it goes on in Q2. And what we're seeing is dynamics beyond those volumes that are very similar. For immunoassays,what I can share is we are still seeing a continued decline of PCT. And the other element on TB test is we are finalizing actually the clinical trial for the U.S. on latent TB, and we are expecting a filing very soon now. So to be able to launch somewhere in 2027.

Okay. One question from Philip, JPMorgan. You pulled out instrument sales down 18% in Q1. Can you remind us of how instrument sales were trending prior to the start of the Middle East conflict?

I think you answered about it. But just coming back to the 2025 performance in instruments. The full year was plus 9%, excluding SPOTFIRE instruments. So we had a pretty strong dynamic in 2025 that we've not seen in Q1 '26 and especially since the start of the Middle East conflict. What do we have, that's pretty much it. Yes, I have a question why the 5% decline in immunoassay, I think you answered it. Pierre.

Yeah.

We are pretty -- yeah, we are done.

I think we have covered most of the questions.

Yes, we have covered most of the questions. Any other live questions?

No. So thanks a lot. And the next communication on our side will be on July 28 for the H1 2026 performance. It's a bit new. We used to report after the summer break. Now it's going to be before the summer break.

Thank you, everyone.

Bye-bye. Have a good day.

The host has ended this call. Goodbye.

[ Welcome to the bioMerieux 2025 Third ] Quarter Sales Conference Call. The call will be structured in 2 parts. First, a presentation by bioMerieux Group management team. Afterwards, there will be a Q&A session. [Operator Instructions]

I will now hand over to Aymeric Fichet, VP, Investor Relations. Please go ahead.

Thanks. Hello, everyone. Good afternoon, good morning, and thank you for joining this call. I'm with Pierre Boulud, CEO; together with Guillaume Bouhours, CFO.

Please note that this conference call will include forward-looking statements that may change or be modified due to uncertainties and risks related to the company's environment. Accordingly, we cannot give any assurance as to whether we will achieve these objectives. I also remind you that today's call is being recorded and that the replay will be available on our website, www.biomerieux-finance.com.

I will now hand the call over to Pierre, and then we will open the call to questions. Pierre?

Hello, everyone. Good morning, good afternoon. So I'll start with giving you the highlights for the year 2025. So I'll start with the sales numbers. We've reached a very important milestone, EUR 4 billion company now, bioMerieux growing 6.2% organically, significantly outpacing a market that we're seeing way around 1% when we look at the diagnostics results from most of the competitors. This growth would have been 7.8% excluding China. What is very positive we see in our performance for 2025 is we've made a very profitable growth, reaching 17.9% of our sales contributed EBIT and growing 16% organically. And finally, on the numbers side, very strong cash flow generation, reaching EUR 460 million, growing 40% versus 2024.

So now if we go into the commercial dynamics and the 4 growth drivers that we selected in the context of GO.28. So if you put them together, they've actually been growing 9.4%. So let me start with non-respiratory BIOFIRE. What I'd like to highlight here is an increase of the net unit installations. As you know, this is an indicator that we follow very closely. We've managed to install an additional 1,800 units of BIOFIRE in 2025, to be compared with 1,350 in 2024. So we have successfully grown installed base by 7% in 2025 only, which is very consistent with the growth perspective that we project for the years to come. And we've done that. We'll come back to that with very limited price erosion.

The second growth driver, as you know, is SPOTFIRE, point-of-care system. So what I'd like to highlight here is a very significant improvement of the installed base, 110%. We've installed 6,400 instruments in 2025 with the successful launch of the nasal swab in the U.S. in the summer.

The third growth driver is Microbiology, where we have a very strong leadership position. As you know, we've been impacted by the decline in China. Excluding China, we've managed to grow 6.3% We are very satisfied actually with the instruments growth in the region of 14% in 2025, growing 14% in 2025 versus 2024. So demonstrating very strong momentum for our Microbiology solutions moving forward. And an additional 2 percentage point price increase in Microbiology, which is also a very positive factor.

Finally, Industrial Applications. What I'd like to highlight is a very strong performance on the Pharma segment, where our launches are demonstrating a very strong impact in the market and the pharma sales growing at mid-teens again, very strong level of [indiscernible] for the future, together with 2 percentage point of price increase.

Now the 2 additional areas of sales that are not a growth driver, but we still obviously monitor very carefully. Respiratory panels, we've actually managed to grow 1%, building on very strong performance already in 2024. The epidemiology was broadly in line, distributed differently between quarters but broadly in line for the full year between 2025 and 2024. What is making us very positive on this one is, again, very limited price erosion, below 2%. And of course, the installed base increase that I was mentioning will also benefit the respiratory panels for the future.

In immunoassays, we've been struggling with immunoassays franchise, as you know, in the last couple of years, minus 6% in 2025. A positive factor that I wanted to highlight here is the VIDAS KUBE, a new system for VIDAS that we have launched now a couple of years ago, is growing very nicely. There are replacements obviously there, but mid-teens sales growth in instruments in 2025, demonstrating that we are actively managing the replacement of the old VIDAS in the market.

So what are the comments on the top line? If we look at the bottom line, 16%, as I was commented -- commenting an improvement of CEBIT. Together with the 6% of sales, so definitely a significant operating leverage. We are deploying our GO.28 initiatives. We are progressing on the automation with regards to manufacturing costs, reaching 40% of the pouches fully manufactured now on the automated lines, which is good news, bad news. I mean, good news is we keep improving. And we still have an opportunity to grow this in the next few years and further improve our costs with regards to BIOFIRE and SPOTFIRE pouches.

We are also progressing in R&D following the decision to close the San Jose site, we are moving forward with adding 1 unified team for Microbiology. And we are progressing also with the transformation of our global customer service that will translate into a better service to our clients and efficiency improvement. Overall, we've increased our headcount around 2% in 2025. So to be compared with a 6% sales growth that we are posting.

Finally, on 2025, I wanted to give you an update on very significant progress on our CSR agenda. We are actually, for nearly all KPIs, either at or above target. I'd like to highlight especially the CO2 greenhouse gas emission that has been reducing close to 30% since 2019, while our sales have been growing 50% since 2019. So a very significant improvement, and we're talking absolute emissions, which, by the way, I'll come back to that, will lead us to review and upgrade our CSR ambition for the years to come.

So before handing over to Guillaume, who will give more granularity on the information on the financial performance. It's been 2 years now that we've communicated GO.28 plans. So we have -- it's a good opportunity to step back after 2 years. So if we look at the different dimensions of the GO.28 ambition, after 2 years, we've been growing sales 8% on average in the last 2 years. So significantly very much in line with the plan. We've grown the EBIT by 20% in 2024, 16% in 2025. So overall, an improvement of 260 basis points versus 2023, very much in line.

In terms of team engagement, we wanted to be in the top quartile of the industry. At the end of 2025, our engagement ratios within the top 5% of the industry. And as I said, I will come back to that, 29% reduction of greenhouse gas emissions versus 2019, very much in line with the ambition to reduce by 50% by 2030.

So with this, I hand over to Guillaume, who will share with you more insights on 2025.

Thank you, Pierre, everyone. So let's look at our financial performance. Pierre already explained very well the commercial dynamics of our different ranges. So you see actually a wrap up on this page. The only thing I can highlight is that BIOFIRE overall without SPOTFIRE, which represents 37% of our total sales as our first product range. And we take everything together, grew 5% in 2025. And of course, our second range is Microbiology, which represents 33% of group sales.

Now looking at maybe some kind of by geography on the next page. So North America grew an organic plus 8%. Of course, it's our first region for SPOTFIRE, so fueled by SPOTFIRE super high growth. Also a very good performance of industrial applications in North America as well as non-respiratory panels. Latin America, as you can see, is super dynamic, quite a stunning plus 18% organic, and it's actually very solid on all product lines in this region. EMEA delivered a 5% organic growth in 2025. We can see notably double-digit growth of BIOFIRE non-respiratory. And I remember, we always have questions on the internalization, meaning outside of the U.S., the push outside of the U.S. for BIOFIRE. So I think this is also pretty visible here in the figures. In EMEA, we should mention a solid performance of Industry Applications as well as Microbiology being mid-single digit.

Asia Pacific, maybe let's stand there, had a contrasted overall 1.5% organic. Really contrasted because, of course, we discussed China all over the year. Just to remind everyone, China declined, so for us, minus 40% is a market downturn with a lot of pressure from authorities to decrease the spend of hospitals, which actually translated in our field, which is mainly Microbiology in China in a volume decline in 2025, so down 14% in China. But very dynamic actually in Asia Pacific outside of China, plus 11% overall. We can mention India with plus -- which is 12%, so above double digit. And of course, Japan, which has now delivered about 30% -- above 30% organic growth in 2025 with a great success of BIOFIRE and SPOTFIRE. Noting that there was the exceptional instrument sales of SPOTFIRE in Q1, but yet a great dynamic in this country.

With that, let's turn to the P&L. So with 6% organic on the top line, we have delivered a solid improvement in gross margin. You can see 8% like-for-like growth of gross margin, which is actually a 90 bps improvement in the margin itself on a like-for-like basis. How do we explain that? We have a product mix effect. As you saw, we had a higher share of BIOFIRE, SPOTFIRE, which I remind everyone is a slightly higher margins than the rest of the group. And we also have in gross margin, a number of GO.28 efficiency that Pierre illustrated earlier that improved our cost of goods sold. We had notably, really nice procurement savings in 2025 and supply chain, international transport savings. And this is all despite the impact of tariffs which we had in H2, of course, in this gross margin part.

Below, we have the SG&A in, let's say, contained increase, I should say, at plus 4%. That also includes some of our GO.28 efficiency initiative, and then you had examples earlier from Pierre. R&D is up 3% on a like-for-like basis. So we continue to invest strongly in R&D at 12.5% of total sales and we deliver innovation. And yet, we have Innovation Powerhouse initiatives to make R&D more efficient overall.

So CEBIT, our main indicator is, so contributive EBIT is up 16% like-for-like, as Pierre said. CEBIT margin, as you can see, improved to 17.9% on a reported basis, which you can break down as 160 basis point improvement on the like-for-like FX and scope compare constant, which -- plus impact of foreign exchange, which was actually a negative EUR 33 million due to the strength of the euro currency against many other currencies. And we can -- we'll come back to FX later on this presentation. And also a second effect, which is the effect of acquisitions, maybe mainly the impact of SpinChip, in which we invest a lot of about EUR 20 million. So altogether, we publish 100 basis points of margin improvement on a reported basis.

With that, turning to the rest of the P&L. So the operating income, the reported one was impacted by VITEK REVEAL impairment that we had already reported and explained in first half this year. Just to remind, it's a lower-than-expected commercial start of this fast AST product. Yet, we still believe in this product. We believe there are high unmet medical needs on this product, and we continue to invest.

But we also decided in H2 to close the site of San Jose of SPECIFIC REVEAL and to combine the teams under our Microbiology franchise in St. Louis in the U.S. We took the associated charges, let's say, impairment and restructuring charges that you see in the nonrecurring line for EUR 40 million. Our net financial results improved from minus EUR 9 million to plus EUR 4 million. This was -- it's mainly linked to the positive impact of euro increase on our internal cash flow, so more technical topics. Income tax is at 24.5% effective tax rate, down from 26% last year, but very stable when you look at the recurring part of effective income tax rate.

And so overall, our net income group share reported is down 8% due to the REVEAL impairment and associated charges. We have decided with the Board to publish for the first time, an adjusted net income and therefore, an adjusted EPS. We decided that to align with market practice. And actually, some of the -- our investors were asking for that. So basically, the adjusted net income excludes the amortization of acquired intangibles and nonrecurring, but we are very tight on nonrecurring. So with that, adjusted net income and adjusted EPS is up 9% in 2025. By the way, the decision of the Board is to propose a dividend to be voted at the AGM of 0.98% -- sorry, EUR 0.98 per share, which is exactly a 9% increase, in line with the increase of the adjusted EPS.

Turning to free cash flow. And Pierre said it earlier, we had a really strong free cash flow generation in 2025, up 40% at EUR 462 million, driven first by an increase in EBITDA, pretty close to EUR 1 billion of EBITDA for bioMerieux now, EUR 960 million, up 5%. Working capital was a negative consumption of EUR 66 million, linked to mainly activity, actually, a small increase of inventory. Almost EUR 30 million increase of receivables. So we collected better when we look at days or overdue, we collect it better from our customers. But of course, we had the higher activity at the very end of the year, so ended up the year with this higher receivables. And in other working capital, we had more payments of social debt, means mainly variable compensation in 2025.

Tax. So I commented on the P&L tax with no major change on the tax rate. On the cash tax, there is a major positive impact of the changes of U.S. tax regulation. It's a bit technical, but basically a more acceleration of R&D expense deduction, which drives a significantly lower tax payment in the U.S. in '25 and probably more of the same in '26, and then it will come back to more normal in 2027. In terms of CapEx, we will zoom on it in the next page, but EUR 328 million and 8% of sales. So overall, EUR 462 million, again, free cash flow that you saw. You see we invested about EUR 155 million in business development and financing activities. So business development was SpinChip, Neoprospecta and Day Zero Diagnostics acquisition. And overall, bioMerieux turned now officially into a net cash positive situation on the balance sheet at EUR 108 million net cash.

With that, we wanted to give you a zoom on CapEx. So this EUR 328 million is split, just to remind everyone between about 2/3 in what is the usual manufacturing CapEx, as you can see, which supports capacity increase for future growth. Automation, that Pierre mentioned, for especially the manufacturing automation in Salt Lake City, and also internalization. You see here, I have a photo of our ongoing work of a new building in Marcy-l’Etoile, for enzyme manufacturing that were previously built outside. 1/3 of our CapEx is actually instrument placement. So it means it's our investment to put instruments, let's say, for free, more or less, at our customers. Of course, with a slightly higher reagents price, that was total EUR 110 million in 2025.

M&A. So we have announced earlier, and its opportunity to discuss a bit more, the acquisition in January of Accellix, a company which strengthens our offering in the Pharma Quality Control segment for the cell and gene therapy market. And we believe it will address new applications and unmet needs in this market. It's basically a point of need. So it's not like clinical. Where we say point-of-care here, we say point of need instruments, which delivers an automated results in less than 30 minutes with lab like quality. It will be used in cell and gene therapy, both upstream when the -- to send the patient blood into production and downstream to verify the success of the operation and thus release the batches.

It's a company that we knew. We've been working with them since 2021. We had a minority investment and a targeted distribution of their product. We believe this product range will serve as an accelerator for the Pharma Quality Control franchise inside our GO.28 plan and even beyond. You see the price that we paid, about EUR 45 million for 100% value of the company. And it should be basically around 2029, around EUR 20 million sales and breakeven by that year.

And with that, I hand over back to Pierre.

Thank you, Guillaume. So it's now a moment to talk a little bit about 2026 outlook. And of course, key product launches to start with. So beyond Accellix, that we are excited to launch the pharma customers, we are finalizing following the acquisition of SpinChip, the CE filing to be CE marked. We expect by the end of the year that we can do a commercial launch end of the year, Q4 '26, maybe Q1 '27. We also wanted to update you on the fact that we have initiated already the clinical study in the U.S. so that we are -- the objective, as we said at the time of the acquisition of SpinChip, to be ready for a commercial launch in 2028 for hs-cTnI with SpinChip in the U.S.

The second big launch that we expect in 2026 relates to SPOTFIRE. It's a bit of a strategic launch for us because it will be the first time we go into women's health with vaginitis. It will also be an opportunity to expand the use of the SPOTFIRE platform beyond respiratory and sore throat. The plan is to file during the summer, so that we -- again, depending on the length of the regulatory review, we can launch at the end of 2026, early 2027.

Last piece of launch, we had SPOTFIRE available in Europe with what we call the high-plex panel for respiratory and sore throat. We are expecting to have in H1 2026, the CE marking for the low-plex panel, 5 targets, nasal swab, that will allow for European customers to address new opportunities and to use this point-of-care solution with a lower plex panel. And for instance, in France, we had in February, a new decree that allows to do point-of-care testing under certain conditions for certain diseases and the financing still needs to be refined, but it's now regulatory approved to have those panels used outside of the hospital and the labs.

So guidance for 2026. We plan to grow between 5% and 7%, so around 6% with an improvement of the EBIT of at least 10%. And if we go to the details of the performance, we expect non-RP to grow around 10%, building on the cross-selling and out of U.S. expansion, knowing that we are, at the end of 2025, we've been growing the non-RP panels 13%. So very much since 2023, so very much in line with the guidance.

For SPOTFIRE, we expect to grow our sales by between 40% and 60%, which is very much in line with the trajectory that we have to reach EUR 450 million by 2028. Microbiology, we expect to grow between 3% and 5% with China still declining, but softer than what we experienced in 2025. We are expecting mid-single-digit China decline. That will also come together with a high comparison basis in terms of new instruments, as I said, in Microbiology, we grew instrument sales by 14% in 2025. Industrial Applications, very much in line with the plan between 7% and 9% sales growth.

Moving on to respiratory panels. We are actually expecting between minus 3% and 2% and plus 3% evolution, knowing that we had a very strong Q1 2025. So we have a very high comp basis. We were -- just to remind you, we were growing 21% respiratory sales in Q1 2025. So to be -- to keep in mind, for those of you who look at quarterly evolutions, Q1 '26 is expected to be very much impacted by this. In immunoassays, minus 5% to 0% and still a little bit of the same story of PCT in China decline. And finally, last but not least, we expect currency effects to have an impact on the CEBIT. Our estimate at this stage, and we update on a regular basis during the quarter earnings calls, is EUR 50 million to EUR 60 million negative impact. So I leave Guillaume to give you a bit more color on this one.

Thank you, Pierre. So we tried to update you on our FX exposure. And we know it's a complex topic. So as you all have in mind, we have a very high exposure to U.S. dollar on revenues. But much smaller net of cost on the CEBIT because we have a high cost base in the U.S. We try to give -- and again, its estimates, of course, the impact of a 5% variation versus the euro on the CEBIT. And it's, for example, on U.S. dollar, you can see that if you compare U.S. to India exposure, it's 12x more U.S. than India on the revenues, but it's only 3x more on the CEBIT. So keep in mind that we are much more sensitive to the rest of the world than the U.S.

And now beyond this, let's say, theoretical variation, we try to give you a bit of a view on the right on where the current rates and some -- depending on the currency, these are the current rates for the spot ones or the forward rates for the more volatile currencies versus the '25 average. So you see the changes, and therefore, how it translates into a forecasted FX impact. Again, bear with me, they are estimates. So the total today is actually pretty negative, very negative, due to the really, really high euro currency strength against most of the world. And so a guidance which we estimate today between minus EUR 50 million and minus EUR 60 million. And as Pierre said, we will do our best to update regularly these figures during the year.

Thank you, Guillaume. And as we have -- we have now, as I was sharing earlier, we have 2 years into the plan. We felt good opportunity to give you an update on our GO.28 ambition. So first of all, I mentioned the CSR new conditions and milestones. We are very much in line, in some cases, above the plans that we articulated before. So we decided, especially on 2 pillars of our CSR ambitions to review towards the ambition. So on the planet side, what we want to do is to expand beyond Scope 1 and 2, which is, as you know, very much the control zone of the companies wanted to add a target with regards to Scope 3, which is the CO2 emissions of our suppliers and our clients. So we'll work on helping them to reach minus 35% by 2034. And we've added, it was approved by the Board, a CO2 net zero objective by 2050, including Scopes 1, 2 and 3.

On the health side, we wanted to strengthen the dimension of accessibility in our CSR ambition. So we wanted to make sure that for antimicrobial resistance impacts, we're capable to improve for low-end middle-income countries the results that we provide. As you know, in those countries, there are significant challenges with antibiotics resistance. We want to make sure that bioMerieux solutions are well available there. As well as we've increased the coverage of antibiotics from 80% to 90% because it's very relevant, again, in the spirit of making sure that antibiotic resistance is well managed everywhere in the world. So that's for the CSR ambition.

With regards to the more financial ambition, by building on the performance '24-'25 and the guidance that we gave for '26, we are very comfortable to confirm the ambition in terms of sales growth, 7% on average between 2023 and 2028. For the EBIT improvement, we said we would grow at least 10% every year. So for the years to come, we -- based on what we've already initiated in the context of the efficiency program that we have, we are also very comfortable to confirm at least 10% every year.

Now with regards to the margin improvement, as you can see, when you put together 2024, 2025 and 2026, we are almost after 3 years, at the level of 340 basis points improvement versus 2023. So we have upgraded it to around 500 basis points to be reached by 2028. I'll remind you, at constant exchange rates at constant scope.

And this is pretty much what I wanted to share with you before we go into the Q&A session.

[Operator Instructions] The next question comes from Kavya Deshpande from UBS.

I've just got 2, please. So first, just looking at your group organic revenue growth guidance and comparing it to the flu headwind you've estimated in a very weak respiratory scenario. Is it fair to say that the bottom end of your 5% to 7% range is driven mostly by the flu? And in that case, you would expect no sort of underlying slowdown in the rest of the business?

And then just also on your EBIT guidance, so you're guiding in line with your GO.28 plan for at least 10% organic EBIT growth even though the floor of the top line guidance is a bit lower at 5%. So would you be able to share the levers that you have that give you confidence you can sustain that level of profitability, especially if we do end up at sort of the lower end of the revenue guide because of weaker flu and lower contribution from high-margin RP sales?

Yes. So on the top line, definitely respiratory season that, let's say, decreased, and it's visible in the stats in January. And again, as Pierre said, we are comparing to Q1 2025, which was a high comp basis for respiratory. So yes, when we look at our guidance and the range between 5% and 7%, the main element that could change between the lower or higher performance in this range is definitely the strength of the respiratory season, which we have to remember is actually throughout the year, yes.

We see January and February, let's say, lower than last year, but I mean it varies quite a lot. 2 years ago, we were surprised by strength in Q2, Q3. Last year, October, November were pretty low and then December super, super high. So yes, let's see throughout the year overall, and that's what we, let's say, try to take in our assumptions, as you could see on RP between minus 3% and plus 3% depending on the full year.

On EBIT guidance, thank you for the question. Yes, definitely, we commit to -- we want to confirm we commit to the at least 10% organic CEBIT growth with sales that can be between plus 5% and plus 7%. So even with plus 5%, it's more difficult. But even with plus 5%, we would commit to plus 10%. Why do we feel confident? Because of our GO.28 plans. As said and as illustrated by Pierre, we have quite a lot of initiatives ongoing, efficiency improvements that we believe we can push, and that will continue to deliver in our third year of GO.28 in 2026.

The next question comes from Aisyah Noor from Morgan Stanley.

My first one is on BIOFIRE, specifically the 1,800 placements you made in 2025. This number was strongly ahead of your 2024 number of 1,350. We know that your European competitor also launched a multiplex system in the U.S. in mid-2024. So could there be a dynamic here where you lost some customers to this competitor last year, and they've now come back because those 1-year contracts have run out? I'm just trying to understand if the 450 run rate per quarter for BIOFIRE is sustainable for 2026 or if there were any one-off dynamics here?

My second question is on the flu season. So your U.S. competitor has called out a 20% decline in respiratory sales for the first quarter. Does that sound realistic to you? I understand you don't guide on quarters, but given the flu volatility, it would be great to get your insights here.

And then my third question is on China. You are guiding to a mid-single-digit decline in 2026. How does this compare between the Immunology and Microbiology business? And what gives you confidence that the decline is due to a weak market and not market share loss to local competitors? I asked this because some of your Chinese -- or some of the Chinese IVD companies are forecasting positive growth in 2026?

Thank you. So I can start with the first 2 ones, and maybe we can together with Guillaume and so on the third one. So the 1,800 installation that we've seen, and I remind you, it's a net on, so it's between the tenders we lose and the tenders we win. Very strong performance, but we are not seeing what you are suggesting, i.e., customers would have left in 2024 and come back in 2025. What we're seeing is it's either new customers or customers who increase capacity in terms of testing units in their labs.

So it's primarily a signal of competitiveness, I would say, of our solutions in the context of competition that you're describing. So for us, now we don't project, you know, It also depends on the market dynamics. We don't give estimate, as you know, in terms of installations from 1 year to another. But it's definitely a positive. As I shared earlier positive signal on our capacity to grow sales on BIOFIRE in general in the next few years.

Flu season, yes, it's complicated to comment the impact of the flu season in the middle of the flu season. But for sure, as Guillaume was alluding to, we are seeing, especially in the U.S., a level of flu season which is below what we've seen in 2025, and I think we should account for that. And by the way, very similar when you look at the data from the CDC website, very similar to the '23, '24 respiratory season, probably mimics this one. So this is what we're looking at. But of course, when we publish the results for Q1, we'll be in a position to share more perspective on what the flu season looks like for Q1.

And finally, on China. What we -- maybe 2 words. As you know, it's mostly Microbiology, I would say, in China. We are not seeing a significant shift in market share, to be honest. It's really a market decline. By the way, we've also seen, if you look at the Q4 results, China declining around 5%, mid-single digits. So very much in line with the projections for 2026. So we're seeing the stabilization of the market. So -- but unfortunately, still declining mid single digits. So as we speak, this is what we plan for 2026. I don't know, Guillaume, if...

Just on the majority of sales, as Pierre mentioned, it's actually 90%, 9-0, Microbiology. So it's really a vast majority, Microbiology versus Immunoassay in China.

The next question comes from [ Rashid Anwar from Infi ].

Let's move to the next.

The next question comes from Hugo Solvet from BNP Paribas.

Just on pricing, please, to get a bit more details, what does the FY '26 guide imply for respiratory and non-respiratory, and Microbiology pricing? Have you seen also reagent pricing getting worse, probably sequentially in Q4, Q1, given replacement cycle competitions, and competitors launching products? And second on immunoassays, when do you think would be a realistic timeline for the business to go back to growth again?

Thank you, Hugo. So the first question is easier than the second one. The first question, pricing erosion. Basically, for respiratory panel, which is the most competitive panel, we have a price erosion, which is below 2% in 2025. For non-respiratory, it's below 1%. It's been -- I mean, as you follow us, it's been very stable actually in the last couple of years, so we don't expect a significant degradation on these front. And beyond BIOFIRE on Microbiology or Industry Applications, we are working on pricing improvement in the same order of magnitude as what we've seen in 2025. So that's for the pricing questions.

With regards to immunoassays coming back to flat, but actually Q4 was better. It's only 1 quarter. It's also -- we are still suffering the -- even though it's, we are still suffering the PCT decline, even though it's 17% of immunoassay sales, it's still impacting us significantly less than in the past, but it's still there. And it's still impacting us in China. So we have those 2 headwinds. So as I said, the guidance is minus 5% to 0%. So there is still -- we are still seeing a realistic option to stabilize sales for immunoassays in 2026. But a midpoint, if you wish, for immunoassays is minus 2.5%.

The next question comes from Jan Koch from Deutsche Bank.

I would like to try my luck with the flu season again. Could you help us with the phasing of your sales guidance in 2026? So is it fair to assume that sales growth in H1 and especially in Q1 is below the lower end of your sales guidance, given the tough comps? And then secondly, on the planned launch of the vaginitis panel and the point-of-care market, could you speak a bit about the size and the dynamics of this market? And how does your test compete with existing solutions? And if I remember correctly, your midterm targets for SPOTFIRE only include RP sales. So should we assume that sales from vaginitis come on top of your targeted number?

And then lastly, on syndromic testing, one of your competitors has recently received FDA clearance for a GI panel, which detects 11 different pathogens. Since your panel is able to do test for 22 targets, I'm wondering how important are these additional 11 targets you have which your competitors does not have?

On the flu season, you want to give a try?

Yes. On the phasing of sales guidance, so definitely not balanced. It was not in -- because it was not on the -- the comparative basis is not balanced. We had a very strong Q1 last year, so a very high comp basis in Q1. So obviously, yes, Q1 should be lower than the full year guidance, of course. And then Q2, Q3, Q4 should -- we will see in these quarters, but should be higher than the average overall. That's very clear. Point-of-care, maybe the prospects, Pierre?

Yes, vaginitis and, high-sensitivity troponin. So what we have said is when we get very close to the launch, at the time of the launch, we'll probably update the market on the expectations in terms of sales, in terms of market share, and giving a sense of how our products compare with the competition. Obviously, it's also depending upon the label that we get from the regulatory authorities. So as soon as we are ready to launch, we'll share with the market perspective. We don't expect a significant impact of vaginitis in our sales forecast for SPOTFIRE.

GI panel, I was not sure I was fully getting the question because there are a number of GI panels in the market actually. What we've done last year, actually, what we did in 2025 was we launched a midplex, so 11 targets panel on GI, and we had a 22 panel for higher plex, when we need to have -- when the doctors want to have a more comprehensive review of the potential pathogens. So we believe we have the portfolio for GI that allows to compete and to address the competition. Yes, that's basically what I can share on the GI panel.

The next question comes from the Natalia Webster from RBC.

The first one on microbiology. You reported double-digit growth in blood culture, reagent sales and mid-teens sales growth in instruments. How much of these are coming from competitive wins? And are you able to provide more detail on the wider market environment for blood culture? And if there's been a change to the lower utilization that you reported previously?

And then the second question, just on that 3% to 5% Microbiology guidance. Do you see this as conservative given the 8% growth that we saw in Q4? And sort of how much of that range is dependent on China performance specifically? And then finally, on SPOTFIRE, on your 900 placements in Q4. Have these predominantly been driven by McKesson versus those in hospital settings? And are you able to provide an update in terms of what you're seeing in the uptake of 5 versus 15 plex panels?

Let me start with the Microbiology questions. So yes, we're very pleased with the good dynamics in terms of instruments, which we believe confirm the leadership that we have taken in Microbiology. There is within those numbers, competitive wins, but to be transparent, especially since we have a leadership position, a number of those installations are also replacement of all the instruments. So we don't communicate or share exactly what's the split, but it's definitely good dynamics in terms of future reagent growth.

The 3% to 5% guidance, you're right, we did actually a very strong performance in Q4 with 8% growth. But there was a little bit of a rebalance with China, which was declining less. And also, as I said, very strong instrument sales that we don't expect to happen again. So we are very comfortable with the 3% to 5% guidance for Microbiology. That's what we believe should -- we should see in 2026.

Finally, SPOTFIRE placements, 900 installations, Guillaume?

So overall in the U.S., for the U.S. part, yes, the majority, about 2/3 were actually driven by McKesson. You've seen we put on the slides that in terms of installation, we put on the slide that in terms of sales, the indirect channel is now 60%. It grew very nicely. It's a successful partnership. It grew very nicely, this part in 2025.

And I think the second part of your question, if I heard correctly, was about the mix effect inside SPOTFIRE. We have now a balanced sales, 50-50 between the 15-plex -- with therefore a growth of the share of 5 plex in '25.

Okay. Yes, please.

Sorry, just to follow up on the Microbiology blood culture as well, whether you're seeing an improvement in utilization there?

Sorry, your question is, do we see a degradation? Improvement? Yes, it's too early to say. As you know, I think you probably referred to the Waters closing the acquisition of BD. You know, we are obviously, we're watching it, and it's a bit early because it just closed. We'll see what's the impact in terms from a commercial perspective with regards to new deals. But as we speak, what we're seeing is very much the continuity of very strong performance. Just to highlight, our 8% growth in Microbiology, I mean, I don't think we have the details for BD, but I think they've communicated a decline of diagnostics business by 10% in Q4. So we see the performance, even though we are disappointed with the overall performance in 2025 in Microbiology, which as you know, it's below initial guidance. We're seeing it as actually a very positive competitive evolution in the market.

Okay, moving to some online questions. So we have 4 questions from Christophe Ganet of ODDO. Inflation of personnel cost, what should be the most likely pace of evolution for 2026 and 2027? What is the installed base of BIOFIRE FILMARRAY full year? What is the level of price effect on FILMARRAY in Q4 and full year? And the last one, can we have an update on savings efficiency plans in terms of million euros? And what is the rest of the journey up to 2028?

So I can take some of those. Thank you, Christophe Raphael. So inflation of personnel cost. So basically, with our global footprint and of course, more weight of U.S. and France, we see kind of average, we call it merit increase or I think inflation of personnel cost around 3.5%, to give you an idea.

To come back to the other question, the level of price effect on FILMARRAY. So as we said earlier and just to repeat on the respiratory panels, we see a price erosion below 2%, and that's been -- there's no significant acceleration on the quarter. It's a regular and consistent trend. And on non-respiratory, the price erosion is actually very minimal. It's below 1%.

Savings and efficiency plans due linked to GO.28. So actually, we have never reported in million euros. As we said from the start, we measure it through our CEBIT margin increase. You saw that, as Pierre said, after 2 years and when we had our target of '26, we will have likely, let's say, delivered the 340 basis point of organic margin improvement that we were targeting in 3 years instead of 5. So as Pierre stated, we have actually logically increased the 5-year target to 500 basis points organic improvement versus 340.

So we still have -- it's also to be very clear. It's not the end of the journey after very well delivering in '24, '25 and likely, '26. It's not the end of the journey. We still have a lot of topics ongoing. Some of our initiatives have delivered earlier than expected. I'd like to mention in '25, the procurement savings. We gave the numbers, it's quite a number of millions delivered in 2025. Some of those were ahead of our plans. There are other topics that are more, let's say, going to produce their effects in '26, even some in '27, and we have plans even, I can tell you, for initiatives that are in the making that have preparation steps in '26 that will actually deliver full year '28. So with that, I would say, rest assured that we still have a number of positive effects from GO.28 plants that are to come in this 500 basis points improvement.

And the installed base of BIOFIRE is 28,500, right? End of '25.

One question from Arnaud Cadart, CIC. What about the recent decree authorizing the point-of-care testing in France? What are the business opportunities for bioMerieux and what could be the update?

Yes. So it's a very recent development, very French, but very recent development where we are seeing that's good news, good news for the patients, good news for the business. That is now in France a decree that allows to do point-of-care testing. So it's organized, and it depends on the disease. It also depends on the settings. It's not -- yes, it's a very regulated and organized way, but still allows to do testing outside of the lab. There are 2. Obviously, SPOTFIRE is impacted, but also SpinChip for myocardial infection could be authorized, but also the respiratory test, especially for elderly patients in the -- we call them EHPAD, in the houses for elderly patients. So there are -- those opportunities are opening.

The decree was published actually 2 weeks ago. So we still need to work together with our clients on what it means. And as it sometimes happens in France, it's authorized, but it's not funded. So there is a funding mechanism to also organize and refine. So we are working on it, but it's very positive news that the market is opening outside of the U.S. and Japan to point-of-care testing. So we see how it goes.

Another question from Arnaud. What loss to expect in 2026 at the CEBIT level from the recently acquired company? It was around minus EUR 20 million in 2025.

So basically, the company is acquired in '25 and especially SpinChip, which is a major one, was in January 2025. So it's now embedded as an organic contribution in 2026. So it's fully embedded in our figure and in the target of plus 10% organic in 2026. The one that will be on the scope change is actually Accellix, which will be a loss for the first year, probably a few million euros of losses contribution in 2026. I remind you, we have said that we will target a breakeven in 2029 for this group..

Okay. One question -- 2 questions from Charles Pitman-King from Barclays. The first 1 is on the BIOFIRE non-respiratory panels. With the increase in competition in the U.S., will the recent launches of the GI Mid and WATCHFIRE panels be sufficient to maintain double-digit growth as the installed base matures? So this is the first question.

The second one is on tariffs and pricing. So we are projecting for 2026, a negative currency impact of minus EUR 50 million to minus EUR 60 million on CEBIT. We assume the 15% U.S. tariff rate, and we mentioned the procurement savings in full year 2025. So the question is, could you elaborate on the mitigating actions being explored to protect margins? And to what extent price increase could be further leveraged in a more cautious hospital spending environment?

I'll take the first one, Guillaume, you take the second one. For non-respiratory panels. So basically, the -- you're right to say that the recent launches of GI Mid and WATCHFIRE are not going to be sufficient to maintain high -- to maintain double-digit growth. And I mentioned, we've actually grown the installed base by 7% in '25 only. So the main driver for growth, actually not market share, it's market growth. We expect the market on non-respiratory panels to keep growing, be it meningitis, be it blood-culture infections, be it GI, pneumonia. So all those markets are growing actually faster than regulatory panel. We are the only ones with such a broad menu of panels. Best competitors have 3 to 4 panels. We have 7. So we keep working on cost savings, expanding the market and the growth of the installed base, which is, again, 7% in 2026 versus 2025.

So that's tariffs pricing. Actually, there are a lot of sub-questions in this question. So I think FX impact, we give visibility. Tariffs, we have not discussed. So thank you. It's a good opportunity. The impact in 2025 was approximately EUR 10 million, EUR 11 million exactly in our P&L of additional U.S. tariffs that we had to pay, mainly in H2. What we see for 2026 and that we have embedded in our guidance is about a bit more than double that, EUR 20 million, EUR 24 million. This impact is after the negotiation with our suppliers who take, let's say, their own share and we take out.

But it's before, let's say, the effects of price increases, which are not specific to tariffs, of course. On price increases, just to mention that we have, as Pierre said earlier, you know that where we can push on price is in Microbiology and Industry Applications. It's not easy, but we are disciplined to do that. Around 2% in Microbiology and Industry Applications in '25, and we should be ballpark in the same target in 2026.

And then there are many other, let's say, actions on the margin improvement, we call them efficiency improvements, as part of our GO.Simple pillar of GO.28. And as I mentioned earlier also, they are part of the margin improvement that we have that we have in our guidance, and that we have even improved for the 2028 target to 500 basis points over the 5 years.

Okay. Moving to the live question. That should be a question.

The next question comes from Philip Omnou from JPMorgan.

Can I just ask, given your net cash position, can you share an update on your capital allocation priorities? And then how are you thinking about opportunities for larger scale M&A? And then my second question, maybe going back to your comments on the margin. But if we just think about the bridge for '26, how should we think about that balance of margin improvement coming from operating leverage or mix and cost efficiencies?

So I can start with the capital allocation and M&A. Basically, our strategy is very much to continue what we've been doing, i.e., we call them bolt-on acquisitions. We have strong balance sheet. So we are looking at companies that bring differentiated solutions that support our core business. And that's very much the continuity of it. We are very much in that spirit. And Guillaume mentioned it, we are going to increase our dividends by 9%, which is also a way to give cash back to the shareholders. So it's the other element I would mention on capital allocation. With regards to 2026 margins improvement?

So it's actually mainly a cost efficiency initiative on top of, of course, of volume growth and, let's say, the scale effect that comes with it. We'll see on the mix. But when you look at it overall, especially with the RP, that could be, again, around neutral. It's not the mix effect that drives the margin improvement. It's mainly our own initiatives. And let's say, yes, proper cost management and cost control.

Okay. One question from Maja Pataki. On the vaginitis panel, can you share how it compares to what is in the market now? And how should we see about the pace of uptake? What's the biggest difficulty with the rollout?

So it's too early to share the details of the vaginitis panel, and we'll -- when we get closer to first of all, the filing and then the approval, we'll share more details. But what I can share is we're excited actually with the vaginitis panel because it will be an opportunity to leverage the very unique features of SPOTFIRE outside of respiratory and sore throat. So we expect time to results to be very competitive, and we expect the plexing capacity of SPOTFIRE to bring an additional differentiation to what exists in the market.

So time to result, point-of-care, plexing capacity, as you know, we like to launch products at bioMerieux that are differentiated. So we'll come back to that, but we expect to launch a differentiated solution in the field of vaginitis.

Okay. And with that, we can close the call. So we'll be on the [ road ] next week, so we will have the opportunity to meet with some of you. And our next call will be on April 23 to comment on Q1 sales performance.

Thank you, everyone.

Thank you. Bye-bye.

Welcome to the bioMérieux 2025 Third Quarter Sales Conference Call. The call will be structured in two parts. First, a presentation by bioMérieux Group management team. Afterwards, there will be a Q&A session. [Operator Instructions]

I will now hand over to Aymeric Fichet, VP, Investor Relations. Please go ahead.

Hello, everyone. Good afternoon, and thank you for joining us to review the Q3 2025 bioMérieux sales performance. I'm online with Pierre Boulud, CEO together with Guillaume Bouhours, CFO.

Please note that this conference call will include forward-looking statements that may change or be modified due to uncertainties and risks related to the company's environment. Accordingly, we cannot give any assurance as to whether we will achieve these objectives. I also remind you that today's call is being recorded and that a replay will be available on our website, www.biomerieux-finance.com.

I will now hand the call over to Pierre and Guillaume, and then we will open the call to discussion and questions. Pierre?

Thank you, Aymeric. Hello, everyone. So I'll start the call with a few comments first on our top line, then I'll share a few qualitative comments on the bottom line, and I'll say a few words on the guidance before I hand over to Guillaume.

So on the top line, as you could see, we have a robust sales performance in Q3 2025 with sales up 7.6%, excluding China and respiratory panel. So total sales were close to EUR 950 million in Q3 with 3% organic growth, including China and the late start of the respiratory season. I'll come back to that. There are several positives in the Q3 performance that I would like to highlight.

First of all, SPOTFIRE, the strong expansion of the installed base, 900 additional instruments were installed in Q3. It compares with 650 in Q3 '24, so a similar period last year. It also compares with 200 new installations in Q2, which was a bit of a question mark when we did the Q2 call on the dynamics of the installation. So we are very happy with the attractiveness of the solution, and we keep building a solid installed base to generate future sales growth together with the expansion I told you.

The second highlight on the top line that I would like to share is the BIOFIRE non-RP. We've grown in Q3 a 9% on a high comp basis; year-to-date, 10%. We had a bit of a negative dip with the pneumonia panel, especially in the U.S. and in Asia Pacific. As you know in the other panels, we have also the pneumonia panel for lower respiratory tract infection. And we've seen a bit of the impact of the low epidemiology that we've seen on RP also on pneumonia panel. But we have very sustained growth in all panels, including pneumonia and very strong installed base expansion, largely above our 2024 year-to-date installations number. So good dynamics from a competitive perspective.

And finally, the third highlight for me of the Q3 sales report is our Industrial Applications. We've been growing 9%, very much in line with the annual guidance and very much driven by our pharma business growing 15% and illustrating the relevance of the offering. So that's some highlights I wanted to share on the top line.

With regards to the bottom line and the profitability, we continue to implement and deliver on numerous good simple initiatives: BIOFIRE automation, headcount strict management, purchasing efforts, supply chain optimization. So even though we don't disclose the numbers for Q3, we had Q3 performance driving a solid profitability over 9 months.

So moving now to the guidance. We've seen we've slightly adjusted it. We had a late respiratory season, September, October also. We now have the October number for the respiratory season, and they are relatively low. It has an impact on the respiratory panel, of course. You've already seen the minus 8% in Q3. It has also an impact on SPOTFIRE performance that we expect to grow around 90% organically, so reaching EUR 170 million in 2025. We then slightly adjust the sales guidance, 5.5% to 6.5% for the year. With regards to the CEBIT, based on the solid 9-month performance I was commenting and the benefit of the good simple initiatives, we do confirm, in spite of that slightly revised sales guidance, 12% to 18% CEBIT growth at constant exchange rate.

And with this, I hand over to Guillaume, who will share with you more details on the Q3 sales performance.

Thank you, Pierre. And now let me provide you a bit more color on Q3. So overall, EUR 950 million, plus 3% on an organic basis, but minus 2% decline on a reported basis. As you saw, we have about EUR 51 million negative FX impact on the top line on sales, mainly driven by the weaker U.S. dollar versus euro. So our GO•28 four growth drivers were up 7% in the quarter, excluding China. If we go through them one by one, BIOFIRE non-respiratory, as Pierre mentioned, has a robust performance, plus 9% in Q3 organic and plus 10% year-to-date; exactly in line with our full year 2025 guidance and actually GO•28 guidance.

Interesting to note that we had really a strong dynamic of organic growth in EMEA, plus 17%; and in Latin America, plus 23% despite, as you know, competition that is well established in these regions. U.S. and Asia Pacific were impacted by stable pneumonia, as Pierre already explained through epidemiology. So stable pneumonia in these two regions because of the low respi activity. And as already said, the number of BIOFIRE installations, net BIOFIRE installations in the quarter was largely above the same period in 2024. On nonrespiratory, in terms of price, we only see a slight price erosion below 1% over 9 months.

Now turning to SPOTFIRE, EUR 32 million sales in Q3, up 66% organic in Q3 and overall more than doubling at 114% year-to-date sales for SPOTFIRE. Plus 900 instruments on the installed base, as Pierre mentioned, which actually drives now to a total 5,500 instruments, up 160% over the last 12 months, September to September. The performance was driven by continued expansion in the U.S. and in Japan.

Turning to Microbiology now, overall 2% in the quarter. Obviously, this performance was mainly impacted by China. China microbiology was down 9% organic with -- as we already explained, but we can come back to that, if you wish, a strong pressure overall in the China market, not specific to bioMérieux, a strong pressure on health care spend. Excluding China, Microbiology is up 4%. But we have to note on a high comp basis, as Microbiology was up 10% in Q3 2024 and still impacted by the effect of some softness in the bottle use, so bacti bottle use in the market.

Fourth, GO•28 growth driver, Industrial Applications, very satisfactory plus 9% organic growth in the quarter, fully aligned with our 2025 guidance. Reagents were up high single-digit, especially driven by the pharma segment, as Pierre mentioned already. Instruments sales were up double-digit, driven by innovation, notably in our molecular range, in our 3P ENTERPRISE new product and a strong positioning on some dynamic segments such as cell and gene therapy.

On BIOFIRE respiratory panel, which is not part of our official GO•28 growth drivers, we had in the quarter a minus 8% decline driven by clearly epidemiology. So lower respiratory activity in Q3 2025 versus a pretty high intensity in Q3 2024. Q3 2024 was up 14% in the quarter last year.

And finally, in Immunoassays, our negative performance is driven by, first, a continued decrease in procalcitonin sales, minus 70%. Now this part of the range represents actually 17% of the overall Immunoassay sales. And second element, the decline in sales in China, both on our virus range as well as Hybiome sales. And before we move to the Q&A, maybe the last point to mention is on the foreign exchange. We slightly adjusted our estimate for the full year impact on CEBIT based on the latest foreign exchange rates to around minus EUR 30 million impact on CEBIT.

And with this, I propose that we move to the Q&A session.

Yes. Thanks a lot, Guillaume. So we are going to open the Q&A session, and we'll start with Odysseas Manesiotis from BNP Paribas.

The next question comes from Odysseas Manesiotis from BNP Paribas.

Firstly, on SPOTFIRE. You delivered quite a strong quarter of placements here. I just wanted to know whether there was any one-off effect similar to Q1? And given your lower expectations for the full year here, how should we think of them in terms of pull-through? Is it around the average of your existing franchise placements or perhaps a bit lower given a higher share of McKesson placements here?

And secondly, on the BIOFIRE installed base. I asked you this a bit earlier in the year, but wanted to confirm now that we're nearing at the end of it. Have you seen any increased price pressure on your negotiations for renewing rental reentered contracts for placements done over 2020 and '21? Should we think this may weigh on your growth profile more than usual for the franchising in full year '26 versus your midterm? Or is it still not a concern?

So I'll take the first two questions. The first one is on SPOTFIRE, right? Okay. That was my understanding. So on SPOTFIRE, we don't have one-off effects in Q3. You're right, there was a bit of a one-off in Q1 this year because of the placement in Japan and the specific subsidy that was expiring at the end of March, and we see a little bit of pull-through in Q1. For Q3, we don't have actually any subsidy in Japan anymore. It may come back at some point, but not for the moment. So we don't have that kind of effect. And with regards to McKesson or U.S. installations, no specific pull-through either. So for us, a very regular decent 900 number. We would highlight it if it was the case that we did it for Q1 and Q2, not in this case. So that's the answer to your first question, I guess.

To your second question on BIOFIRE. And yes, you actually raised it impact on price pressure with more intense competition. Guillaume has mentioned the price pressure already on RP and non-RP. So we have a bit of price erosion on RP, which has been relatively consistent actually in the last few quarters, minus 1%, minus 2%. It's less than 1% on non-RP. So what we see is, of course, we are working on being competitive when there is competition, but we are successful so far into maintaining a good level of pricing for both RP and non-RP on the BIOFIRE franchise. I hope it answers your question.

The next question comes from Anchal Verma from JPMorgan.

Just two questions from my side. Firstly, just trying to understand the dynamics around H2 margins. Given the top line guidance has been lowered, can we expect CEBIT growth to potentially be in the bottom half of the 12% to 18% guidance or more like the upper end of the guide is more difficult to achieve now? Or are there any offsets that we haven't thought about?

And then the second question is, and I appreciate it's early, but as we start to look into FY '26, can you talk through the drivers for the top line and the various moves that we should be aware of? And how should we be thinking for the bridge into next year on margins given a relatively tough comp base coming from FY '25?

Okay. Thank you very much. So dynamics on CEBIT, what we can say is, as Pierre mentioned, we see on a 9-month basis, a strong profitability that we don't report, but we can confirm that. That makes us confident for the year-end. That's why we -- despite the slightly lower sales guidance, we are confident to confirm the 12% to 18%. So at this stage, we say the right range. We are not looking at the bottom or the high end, we are looking at this range. So the midpoint will make sense. Let's see. So I think that's it for 2025.

Now turning to 2026, what I would like to remind you is actually the framework that we have committed to, which is the GO•28 financial targets. On the top line, we have committed to a compounded annual growth rate over the 2023-2028 of 7% organic, and we are fully aligned and actually even slightly above even with this slightly lower 2025 organic growth. So fully aligned with the 7% compound. And on the bottom line, the CEBIT. We have committed to improve by 340 basis points on an organic basis to reach 20% margin in 2028 at the scope and exchange rates of 2023. And on top, we have also committed to improve every year by at least 10% the CEBIT on an organic basis. So we are still -- absolutely still on these commitments of GO•28. We are, of course, as we speak, building on our 2026, let's say, budget and on this basis.

The next question comes from Aisyah Noor from Morgan Stanley.

My first one is a bigger picture question on flu, for Pierre. So we've had about 3 years now where the respiratory season was better than the, let's say, flat growth or market growth that you had forecasted. Is there a risk going forward where instead of a late flu season, we could be seeing a more persistent volume contraction in respiratory testing? Just would love your thoughts on the midterm outlook there. And if what you've seen this quarter has changed your view on the midterm respiratory testing demand environment?

Second question is on nonrespiratory growth for BIOFIRE. Between your various panels, so GI, blood culture, are you beginning to see any pricing pressure from new competitors? And is there any reason for us to believe why the nonrespiratory growth for 2026 shouldn't decelerate further to a kind of 5% to 7% range?

Thank you, Aisyah. So let me start with your first question, which is a bit of a general broader question on the impact of respiratory season moving forward. Honestly, to your point, we benefited in a way from high -- relatively high respiratory season, most notably in '24 that was a bit bigger than '23. Our reference is 2023. 2025, the beginning was high. We don't know yet what's going to happen in November, December. But as I said, it's starting late. I'm not sure I can give you a relevant perspective on what's going to happen in the next few years.

What we are seeing, especially in the U.S. is a lower level of vaccination rate that may actually have an impact on the number of hospitalizations in the same flu conditions that may be a headwind, but -- sorry, a tailwind. But honestly, I'm not aware of any reason why the flu season would be significantly different after COVID than before COVID or in the next few years. So unfortunately, it's part of the uncertainty we kind of live through. And some years are a bit stronger, some years are a bit less strong. That's one of the reasons why back to Guillaume's comment earlier, we guided on 7% year-on-year on average because there will be some years that will be stronger and some years that will be softer because of the respiratory season uncertainty.

That's beyond -- at least what I can say on your first question. I'm not sure it fully answers your doubts. But the second question relates to non-RP. Yes, it's a good question. We've seen a deceleration of the nonrespiratory panel 10%, but 10% is still very much in line with our guidance. In the GO•28 target, we said the market will grow actually above 10%, and we would actually lose a bit of share that would allow us to grow in the region of 10%. What we are seeing, which is very reassuring in my mind is we keep growing the installed base, which in this business is the consumption of reagents tomorrow. We are still seeing segments, and I'm thinking meningitis, pneumonia, BCID, GI, where the use of syndromic molecular panels is still underused and there is opportunity for growth, which translates into the increased installed base.

So we are confident, based on what we see on our capacity to deal with the competition. We talked about very low price erosion, and keep a strong market share in a growing business. So 10% growth rate seems to us a very reasonable target after 2 years in GO•28 implementation plan.

The next question comes from Dylan van Haaften from Stifel.

So just two questions from my side. So firstly, just on the RP trends you guys are seeing. So if we kind of recap what we saw last year, which you kind of explained as part of the comp reason you were seeing in the epidemiology. I think last year, we had a slow COVID wave, and this had a knock-on effect on 3Q. But we were broadly aware of that as well in the 2Q when you guys updated the guide as well. I was just wanted to understand like what kind of things are you guys seeing that are making you guys more, let's say, conservative relative to what I think were relatively conservative comp-based expectations going in?

And then just my second question would just be on, could you just remind us what the residual headwind is for Micro and Immuno in China for the 4Q and maybe the 1Q, if we should be thinking of a similar sort of headwind? And if there's any incremental things you want to flag there?

Thank you, Dylan. I can get started on your two questions. The first one, the RP seasonality. So just to remind all of us, in 2024, we had a very strong -- the respiratory season '24-'25 was actually pretty strong. So we had a high Q4 and a high Q1. So we benefited in 2025 from Q1. To your point, we've repeatedly said in -- at the end of Q1, at the end of Q2, be careful because we have a high comp basis in Q3, but most importantly in Q4. So that led us to the guidance we were talking about. At this stage, not much difficult to predict what's going to happen in November or December. To be honest, especially in the U.S., a lot around Thanksgiving is that basically where you start seeing things. But this year, we are seeing a late start, as I said, September, October. So that's what we can say on the respiratory season and the impact for our business.

And as I said, what we're starting to see is that SPOTFIRE consumption rate is also impacted by the level of epidemiology. So when we have a low respiratory season, it has also an impact on the burn rate of the SPOTFIRE installations. So even though we have very solid and very dynamic new installations in terms of SPOTFIRE, we are seeing the burn rate in Q3 much lower. So that led us to reduce slightly the objective from 100% to 90% growth at EUR 170 million.

With regards to the risk in China, what we assume in the guidance is kind of continuation of what we see in the first half. Q3 is still bad, but slightly better. Too early to talk about Q1 '26, to be honest. But what we are seeing is, yes, for the year 2025 is fully embedded into our guidance. We are seeing China being very soft for the full year.

Okay. We have as well some online questions that we'll go through. The first one is from Charles Pitman-King from Barclays.

What dynamics have you seen over October, November with respect to respiratory demand? And what level of growth in demand is assumed in your reduced full year '25 guidance? This is the first question. The second question is how impacted is your visibility of customer demand, customer visibility of their own needs by the suspension of federally funded CDC function as a result of the government shutdown? Has this increased uncertainty led you to provide more conservative guidance?

So on the respiratory, as we mentioned earlier, we saw a lower level in September, October in terms of respiratory activity, epidemiology that is included in this revised sales guidance. We don't know what's going to be the level, of course, of November, December. We take an assumption of medium but late season, and that will make the difference between the bottom and the top of our range of 5.5% to 6.5%. On the federal funded CDC, yes.

Yes. I'm not sure it -- network has a huge impact for the hospitals. They basically manage a little bit of stock at the hospital level to be able to cope with the demand. And when they see the demand increasing, they increase their level of orders. So it's definitely not improving our level of visibility because it's good to have that kind of a holistic perspective on what's happening in the U.S., but not significant impact for the clients.

We have a question on SPOTFIRE revenues for 2025. Just to recap what Pierre already said. So the guidance now includes the target revised at EUR 170 million. It's still plus -- around plus 90% organic growth, so quite close to doubling, but a bit below our earlier guidance.

Okay. Some questions from Christophe-Raphael Ganet from ODDO. The first one is on SPOTFIRE, is it possible to have more granularity on the type of client among the 900 clients or the 900 new instruments that have been installed over the quarter? How long do you see the remaining pressure on the Chinese market, another year of decline or base effect should be positive as of Q2 2026. And the last one is what can you do to improve the usage of noncore panels, meningitis, BCID, et cetera, in the future? So this one is for BIOFIRE non-RP.

So I can start with the first part of the first question, which is the 900 -- it's not clients, it's 900 installations. So some clients require more than 1 unit. It's actually -- it was a good performance -- I mean, the good way to answer the question where it goes is where it comes from. It's either McKesson or it's owned by the bioMérieux team. And we're seeing good dynamics in Q3 on both sides, which makes installations both in hospitals and in what I would call a pure point-of-care settings. So that's relatively well distributed as we speak with good dynamics.

The second question relates to the remaining pressure on the Chinese market. So too early to say for '26. But as I said, 2025 kind of a similar picture for the 2 months to come or the quarter to come. And finally, what can we do to improve the usage of noncore panels? It's very much a strategy for cross-selling when we have the installed base, the instrument installed in the lab, it's medical education, it is cross-setting. And one of those areas where actually having a bit of competition is not necessarily bad. We believe we have a very competitive offering and the best panels and the best menu in the market. So more client education helps to grow the business. So this is -- these are the major drivers for non-RP growth.

Okay. Coming back to live questions.

The next question comes from Jan Koch from Deutsche Bank.

The first one, could you discuss the revenue per box utilization differences for SPOTFIRE between Japan and the U.S. that you have seen in recent quarters and give us a quantitative ballpark of the difference? And then secondly, regarding currency headwinds on earnings. Some of your peers are using the U.S. dollar or the euro as a contract currency in hyperinflationary countries. Have you explored similar strategies to mitigate some of the currency impacts?

Okay. So I'll take the first one and Guillaume take the second one. On the first one, basically it's -- we don't give the details on the burn rate of the instruments. And actually, you've seen the variation in Q3, very much related to epidemiology. So it varies by country, it varies also within the country where the instrument sits. Is it in a large traffic kind of setting or is it a lower traffic kind of setting? It also varies between 5 [ plates ] and 15 plates for RP.

So honestly, for us, the business drive, if you wish, is to make sure that we grow the installed base and we are working on this and to also expand the menu that is available on SPOTFIRE, which is, as you know, our strategy to have vaginitis in '26, meningitis in '27, GI and SDI in '28. So we are really building the installed base to be able to increase and leverage it, to increase the burn rate and leverage the installed base in the years to come. So that's basically it for your first question. And the second question?

Second question, if I understand, was on inflation countries and currency impact. So just to -- we are exposed to two high inflation countries, Argentina and Turkey. And we can confirm that in those countries, we are able to increase prices to basically offset the very negative effect of devaluation of these two currencies. So we offset with higher price increase, so higher organic growth, the negative impact on CEBIT. That's for those two countries. Then, of course, all the rest, especially in the past 6 months with the euro strengthening against many, many currencies, especially Asia currencies, LatAm currencies, dollar, of course, where we try to pass through some of it. But of course, it's a bit more of a challenge depending country by country.

The next question comes from Natalia Webster from RBC.

My first one is on Microbiology. You mentioned you're comfortable with the group GO•28 targets, but checking if you're still comfortable with the 6% to 8% range for Microbiology given sort of weaker China, slightly slow uptake of VITEK REVEAL and then a bit of a lower demand for blood culture as well. So curious to hear your thoughts into 2026 and what could drive that level back up to that range? My second question is on Immunoassays, but a similar question in that your GO•28 target is for flat sales for this segment, but you're now down about 9% for the 9 months in '25. So are there any drivers you can point to that can help to offset some of those continued declines in that segment?

Okay. So I'll take this one, Natalia. So the first question on Microbiology. I mean it's fair to say that 2025 is a bit below our long-term expectations. We have, to be honest, a bit of a perfect storm with China, with the blood culture crisis, long-lasting impact and also VITEK REVEAL that, as you said, is a bit below expectations in terms of launch. And as you know, we are the worldwide leader in microbiology. There is an underlying market growth perspective that we see at around 5%. And in this market, we keep increasing price and we keep taking share. At the end of H1, a major competitor in the U.S., we were actually taking share from them, even though we were disappointed with the Microbiology sales perspective.

And we don't talk much about new installations in Microbiology, but we're actually also successful with new installations and competitive wins in Microbiology, even though it's a slower market than molecular. So a bit of a lower performance. But as Guillaume said earlier, when we look at the 6% to 8% growth in Microbiology, we are looking at the growth of 5 years. We are above the target in '24; '25 will be a bit lower. We are doing everything we believe is necessary to achieve that 6% to 8% in the years to come.

With regards to Immunoassays, to your point, we've been below on this one. We've been below the target now for the second year in a row. We are working on trying to increase sales into emerging countries with routine barriers. We are still suffering heavily from PCT, but we're also launching new reagents that have not yet compensated the decrease in PCT. We are, for instance, working actively as we speak on getting TB-IGRA approved in the U.S. in the context of the plan. So there are opportunities for growth with VIDAS that we are exploring and working on as we speak. But it's fair to say, unlike Microbiology, the beginning of the plan is more challenging.

And if I could just follow up on SPOTFIRE as well. Could I just confirm if those EUR 190 million for the full year and EUR 450 million for the 2028, those targets still stand?

So what we just said today is actually in the context of the revision of our sales guidance, 5.5% to 6.5% overall in the late respiratory season and the lower consumption of SPOTFIRE in Q3. Revised guidance for '25 on SPOTFIRE at EUR 170 million, 1-7-0, going 90% versus 2024, around 90% organic. And honestly, at this stage, given the base of new installations that we have, we confirm the EUR 450 million that we have for 2028. But it's fair to say that 400 -- I mean, I don't know the respiratory season in 2028, right? I'm still struggling to know what happened this year. So there is an element of flexibility or uncertainty with regards to respiratory season '28, but very comfortable to confirm the EUR 450 million that we communicated in the context of GO•28 for SPOTFIRE in the plan.

The next question comes from Kavya Deshpande from UBS.

It's around customer demand for SPOTFIRE instruments, given you had a very strong acceleration in installations this quarter versus Q3 2024, even though the respiratory season maybe looks to be off to a weaker start versus last year. So in your view, is the acceleration in installations because customers on the ground expect the flu season to become stronger later? Or is it because customers tend to onboard SPOTFIREs with longer-term considerations in mind beyond just the current flu season? And if the answer is that this demand is longer term, then should we expect that SPOTFIRE installations continue to accelerate year-on-year over the coming quarters even if the flu season turns out to be a bit less severe than last year?

Kavya, good question. So I mean, your two assumptions are good assumptions. The first one is usually, we're seeing very slow installations in Q2 because this is the end of the respiratory season and the doctors, the point of care, the hospitals don't bother with changing their systems or instruments as they are ending the respiratory season. Q3, July, August, September, they usually -- it's a good time to think about what's going to happen. They don't know yet what's going to be the respiratory season, but they kind of decide to take SPOTFIRE or another solution without knowing what's going to be the intensity of the respiratory season. So that's the first part of the assumption.

The second element is whenever they do that, anyway, it's their contracts of 3 to 5 years. So it's always with a longer-term perspective beyond the intensity of the respiratory season. So the number of installations that we are seeing in Q3 in both -- according to both assumptions is anyway a little bit independent of the intensity of the respiratory season.

Okay. Some extra online questions. One other question from Christophe-Raphael Ganet, ODDO. Is it possible to have your updated view of tariffs impact? Maybe for you, Guillaume.

Yes. So tariffs, we confirm what we already said in H1 that we expect a growth impact on a full year basis in 2026 of about EUR 35 million that we are working on the mitigation actions and the way we will integrate that in our 2026 plans. Which means also for about half a year in 2020 -- a bit less than half actually in '25, about EUR 5 million to EUR 10 million of net impact in '25 that, of course, is included in our guidance of plus 12% to plus 18% CEBIT for this year.

Okay. Two questions from Arnaud Cadart, CIC. First one, are you able to extract cost efficiencies a bit ahead of what you were expecting in April 2024 when you communicated on the GO•28 strategic plan? And second question, what about the catch-up of prices in Industrial Application? Is it satisfactory?

Maybe I can start and Guillaume, you don't hesitate to jump in. Yes, we're a bit ahead on the profitability perspective. I mean we did 20% profitability improvement in '24, 24% in H1. And as we said, Q3 is still strong. So we are seeing maybe an accelerated improvement of what we are expecting. We are expecting it to come a little bit slower. So that's definitely good news, and we are ahead of the plan.

Catch-up of prices, I mean, Guillaume was talking about the tariff. Definitely, one of the way to mitigate the tariff impact is to increase prices. So it's something that we are working on as we speak. Obviously, it takes to be a bit targeted because we don't want to lose competitiveness, but we also want to share some of the pain from the tariffs with our customers. And this is the plan as we move into 2026.

Okay. And with this, I think we've covered most of the question. Yes, one last question from [indiscernible], an investor. Some of your competitors in the screening sector in the U.S. have reported that their customers started purchasing earlier than usual in anticipation of the upcoming respiratory season. Have you observed the same trend?

Not at all. Q3 numbers have 0 stocking impact from customers.

Okay. And with it, if there are no further questions, we will stop there the call. Our next call will be next year on February 27, where we will present the 2025 full year results and the outlook for 2026.

Thank you, everyone. Have a good afternoon.

Thanks. Bye-bye.

Welcome to the bioMérieux H1 2025 Financial Performance Call. Please note this webcast is being recorded. [Operator Instructions] I will now hand the conference over to Aymeric Fichet, Head of Investor Relations.

Hello, everyone. Good afternoon, and thank you for joining this call. I'm in line with Pierre Boulud, CEO; together with Guillaume Bouhours, CFO. Please note that this conference call will include forward-looking statements that may change or be modified due to uncertainties and risks related to the company's environment.

Accordingly, we cannot give any assurance as to whether we will achieve this objective. I also remind you that today's call is being recorded and that a replay will be available on our website, www.biomerieux-finance.com. I will now hand the call over to Pierre, and then we will open the call to discussions and questions. Pierre?

Hello, everyone. Good morning, good afternoon. So I'm going to share with you, first of all, key highlights for this first half of the year, and then I'll follow up with business highlights. Then I will hand over to Guillaume, who will share with you an extensive update on the financial performance. And then I will-- he will hand over to me to discuss about the guidance that we've issued for the full year 2025, and we'll open for Q&A.

So key highlights. If we look at the key numbers for the first half of 2025, a very strong 9.4% sales growth, which we see as a very solid performance in the market, mostly driven by double-digit growth in both in all of the GO·28 growth drivers, together with strong performance for respiratory panels. What we believe remarkable in the first half of the year is that together with this 9.4% sales growth, we've managed to achieve close to 24% like-for-like increase in profitability.

So we are now moving from profitability that was 16.4% at the end of '23 to 18.2% at the end of June 2025. So very solid performance. And finally, and you know it was a topic that we were working on in the context of our GO·28 plan, generation of cash flow. We have tripled -- more than tripled free cash flow generation to EUR 170 million in the first half of 2025 versus the first half of 2024. Now if we go into the different levers and dimensions of our GO•28 plan that we shared with you at the beginning of 2024. Go for Growth, I'll come back in detail on the sales growth drivers.

But beyond those growth drivers, it's worth mentioning that the first half was very busy with new launches that are obviously instrumental for future success and sales growth. We've also strengthened our R&D portfolio with two acquisitions in the first half ,Point-of-Care immunoassays solutions with the acquisition of SpinChip and the acquisition of next-generation sequencing with a U.S. company based in Boston, Day Zero assets. And all of that is embedded into a 12% of sales invested into R&D for now and for the years to come.

Going simple, we'll come back to that in detail, and Guillaume will also share with you very, very glad with very strong success. You've seen the 24% improvement of EBIT. Obviously, the result of those efforts on many dimensions, be it procurement, be it manufacturing, be it G&A improvements, very satisfactory and definitely a little bit faster than our expectations.

GO stronger relates to the engagement of the employees, and we are also ahead of the plan. Last year, the voice of employee showed we were on the top 25 companies now we're in top 5% in terms of engagement from the employees of bioMérieux. And finally, going responsible, we are very much on track with the CSR ambition. I just would like to highlight a 27% reduction in greenhouse gas absolute reductions, while as you can see, we are growing very strongly. So moving on to the business performance, and I'll start as usual with the four growth drivers that we identified with GO•28. So first of all, BIOFIRE non-respiratory panel, we continue the expansion.

We have launched two new panels in the first half of 2025. MIDPLEX GI Panel that is targeting 11 pathogens associated with gastroenteritis and that allows to address a segment of the market where the reimbursement and coverage, especially in the U.S. goes from 5 to 11 parameters. So that allows to maximize the level of coverage while maximizing the diagnostics efficiency. And we are continuing the deployment of commercial levers, cross-selling strategy.

I would like to highlight a very satisfactory performance on now we have a majority of customers that are using at least three panels. And as we are broadening the menu of panels, obviously, it will help and support three additional percentage points since H1. And the other element, which is also more for the future years and quarters relates to installed base. You already know we have the largest installed base in the market with more than 27,000 units.

We don't give any more because the market is mature, so quite early installations for BIOFIRE. However, very happy to share with you that when we look at H1, the number of net new installations, so between the losses and the gains, the new installations are actually stronger in H1 '25 than in '24. So we are not only increasing installed base, we are accelerating the increase of the installed base. Growth driver among the two is SPOTFIRE. So SPOTFIRE, I won't come back to the very competitive features of the solution.

Maybe mentioning the very recent FDA approval of Nasal Swab for RP mini. So until now, we needed a nasopharyngeal swab that we have all experienced in the context of COVID. Now with the Nasal Swab, we have a less invasive, especially very relevant for pediatric patients that will hopefully help and support continued growth of our SPOTFIRE solution. We have a number of installation in Q2 that is a bit slower because it's a very low respiratory season.

We'll come back to that. But overall, very strong increase in H1 of our installed base, 1,600 additional instruments and very much in line with our plan. We are growing 143%, so very much in line with our target for the end of the year to double our sales. Growth driver number three, is probably a problem child for this first half. We are below our expectations, to be honest, and it's mostly related to China. So 3.3% sales growth with a very strong impact of Chinese decline and the market decline in China that has continued in Q1 and Q2.

We'll come back to that when we come back to the guidance. Excluding China, it's interesting to see that we are still growing very nicely, 6% and taking share more or less [ duopoly ] in this market, and we are seeing the competition actually with negative sales. So we have a very strong dynamics in instruments. We believe the competitive position is strong, but obviously, because of China, below our expectations.

It's worthwhile saying to the credit of the commercial team that even though the inflation is now very low, we've managed to increase prices by 2 points in H1 versus H1 '24. The fourth growth driver, very, very positive at 10%, very on industrial applications, actually a little bit above ambition. We are seeing very strong dynamics very much driven by pharma quality control with reagent sales up 15%. And what is very nice in this growth and very satisfying is that it's very much driven by the innovation that we've launched in the last few years. So I will mention three. The first one is BIOFIRE Mycoplasma. We have an industrial application using BIOFIRE platform for pharma customers, very strong growth of sales in H1 and very, very strong dynamics. GENE-UP is also a molecular solution, mostly used for food, but we're seeing very strong dynamics also on this new system. And finally, we have environment monitoring a new solution called 3P ENTERPRISE that is showing very, very good promise and also a very strong driver not only for H1 but for the future.

And still, even though the market is obviously more complicated with inflation, we managed to increase pricing by 2 points. Now to give you the full perspective on the product portfolio, I need to mention BIOFIRE respiratory panel. So we've been growing actually 12%. Q2 was lower, plus 1%, very much driven by a very low epidemiology. And also worth saying Q1 last year, we are growing 17%, so very strong basis. So we've managed to actually not reduce the sales in spite of the lower epidemiology.

We're seeing limited price erosion. So overall, a strong performance in H1. Immunoassays, again, this one is the other problem that we have with a bit of more disappointing performance in H1 very much driven by China. The positive note on immunoassays is the new system that we launched on VIDAS. VIDAS KUBE is actually we now have 2,600 instruments installed and 700 only in H1 2025. So we're starting to see a good ramp-up of new installations for VIDAS KUBE, which is also a good factor for the future. And with this, I hand over to Guillaume, who will go through more details on our financial performance.

Thank you, Pierre. Hello, everyone. So this is a wrap-up of what Pierre presented. You see the full sales of the group by product range. And the different overall drivers of our 9.4% organic growth. Obviously, molecular as a whole with BIOFIRE, RP, non-RP and SPOTFIRE is a very strong driver. Taken altogether, it's actually plus 18% organic growth on molecular. And Industry Applications, as already mentioned, is also a very nice growth driver.

Overall, it's important to state that with 9.4% organic, such a strong performance is probably one of the best in the overall diagnostics market, if you look at other players. Looking at the same, but by geography, -- you see that the main source of growth this H1 was coming from North America at 15% organic and Latin America at 17% organic. Notably, molecular in the U.S. was very strong from BIOFIRE and SPOTFIRE.

EMEA was softer at plus 4% despite a solid growth in BIOFIRE non-RP and blood culture reagents. The Asia Pacific performance was very contrasted with China, we mentioned already, overall down 17%, while actually Japan was -- had a very strong growth, boosted by the success of SPOTFIRE in Japan. And India continues to grow double digit, notably on VIDAS immunoassay. So overall, 2% in Asia Pacific, more than offsetting China in the region. Now if we move to the overall P&L view, and I will comment on the right column on a like-for-like basis.

You see that with 9.4% growth of sales, we generated 11% organic growth of gross profit, so an improvement of 80 basis points of the gross margin, thanks to a favorable product mix on the equipment reagents, but also the BIOFIRE share, which, as you know, is high margin in the overall mix of reagents as well as part of our GO•28, GO.Simple pillar with a contained rise in manufacturing costs and lower transportation costs in H1.

SG&A costs were up 7.7% in H1 with, let's say, a significant one-off to mention in this line, which is the MyShare program, this employee shareholder plan with favorable conditions for employees to buy shares, which costed accounting-wise, EUR 8 million in this line in H1. So excluding MyShare, we are even growing, let's say, only 6% on SG&A, which reflects the -- as well the GO.28 initiatives on simplification and efficiency. I will come back to it in a minute.

R&D, up 3% at 12.2%. And as Pierre mentioned, this includes on the 12.2%, the SpinChip running costs that are mostly in this R&D line. So overall, thanks to GO•28, we -- you can see an improved operating leverage with 24% organic growth on CEBIT, while we grow sales by 9.4%. Last comment on this page is FX, foreign exchange, which was neutral on CEBIT in H1 despite the euro appreciation over Q2 and thanks to our hedging policy in place.

Let's zoom together on GO.Simple. Pierre already mentioned the progress. As a reminder, GO.Simple is not a few landmark big initiative, but quite the opposite. It's actually more than 50 different actions being rolled out and delivering on efficiency. So here, we want to give some examples -- in the COGS category, cost of goods sold, we can mention that we successfully internalized the manufacturing of our mass spectrometry instrument by VITEK MS PRIME in the U.S. and in Italy with a significant reduction in the cost of the instrument from purchased last year to actually now internally manufactured.

On automation, we are making -- continuing to make progress on the automation of the BIOFIRE reagent manufacturing now at 30% of the volume on fully automated lines. Third example on COGS, major progress on purchasing or procurement with successful negotiation and also sometimes resourcing, delivering savings on sometimes direct materials among these figures, but also on indirect services. I mentioned earlier in the P&L, lower transportation cost. This is partly due to purchasing efforts.

In support functions, we are working on the new HR operating model that has been finalized in terms of design, and we also implemented actually a simplified budget and performance monitoring in finance for the company. In commercial operations, I want to mention the ongoing transformation of global customer service department, as well as the finalization of design for the new marketing operating model. As you can hear, when it's about finalizing design, it means that we will deploy in the future these initiatives.

So we're also preparing for additional efficiency in the next three years of GO.28. Overall, these examples and other initiatives translate into notably limited headcount evolution. We are at about 2% increase in headcount to be compared to the 9% top line increase. And as you saw in the P&L, contained controlled SG&A increase. Now turning to the P&L, profit and loss below contributed EBIT. There is this slide about amortization of acquired intangibles, which this H1 has a very significant one-off with the impairment of the Reveal technology.

As a reminder, Reveal is a fast AST Anti Susceptibility Testing technology that we acquired in 2022, the company specific Diagnostics. We obtained FDA approval in mid-2024, and we launched commercial in the U.S. in H2 2024. We see today that this market segment, the market segment itself of Fast AST is developing slower, much slower than our expectations. And therefore, our own commercial ramp-up on Reveal is below expectations and below our plans.

As a consequence, we have revised our plans and we recognized in H1 a partial impairment of EUR 146 million of these assets. It's about 2/3 of the value that is being tested, so about EUR 80 million roughly is still in the books. We still believe actually strongly in this technology and in the strong medical -- the high medical value that it brings for the most critical sepsis patients. Below in the profit and loss, you see that net financial income improved versus last year, thanks to exchange gains on mainly cash positions and hedging.

Tax is relatively stable at 24.7% effective tax rate, actually 24.1% on a recurring basis. And overall, net income is down 25% due to this one-off reveal impairment, but is actually up 45% year-on-year, excluding this one-off Reveal impact. Now moving to free cash flow, a very strong free cash flow overall compared to last year, more than triple at EUR 170 million. You can see that the first explanation is that our improvement in EBITDA, which is pretty nice. Working capital requirement was also less negative than last year.

We have inventories up EUR 25 million in H1. One of the key elements was the -- as part of what I explained earlier, internalizing the manufacturing of our VITEK MS Prime instrument. We took over all the inventory from our external supplier that was part of H1 effort and also replenished our BACT/ALERT raw material. You remember the story of BACT bottles last year. Also to mention in working capital, a really nice, let's say, improvement on the receivables with an efficient cash collection, notably in the U.S. in H1.

CapEx are pretty stable in amount at 7.5% with investment, especially on the U.S. manufacturing side, capacity automation as well in CapEx as the investment in our installed base with placement in some markets such as SPOTFIRE in the U.S. The EUR 170 million free cash flow were notably spent on business development with SpinChip and Day Zero that Pierre already mentioned. And overall, the group's balance sheet is very strong with a net debt of, let's say, only EUR 126 million, 0.1x 12 months EBITDA.

We can now turn to the outlook for 2025, and I will start by giving you some, let's say, updated tariffs exposure from, of course, what the tariffs have been announced today. So we have basically a threefold exposure to tariffs. The main ones are on the U.S. side. We manufacture 85% roughly of what we sell in the U.S. is manufactured in the U.S. So we have an exposure on the 15% of finished products that we import into the U.S. from mainly Europe and for a small part of Australia. Second exposure are the imports for U.S. plant of raw materials and components from outside of the U.S., mainly Europe, sometimes China or Mexico.

And then the third one is the import into China of microbiology instruments and VITEK reagents. Overall, taking all that together, trying to update our calculation, we believe we should have an impact, but that you will see embedded in the guidance of about EUR 5 million to EUR 10 million on CEBIT in 2025. So it's mainly an H2 impact, not much in H1. And our first estimate it's complex for 2026 would be a growth impact of about EUR 35 million.

When I say growth, it means it's before mitigation actions such as procurement, negotiating with the supplier or resourcing, supply chain or commercial, of course. And with that, I hand over to Pierre.

Yes. So it's the final slide on the revised guidance. So as you can see, we have -- in fact, again, because of China, the major impact of the sales review of sales guidance is China. It shows on two lines, actually microbiology, we have a significant share of our sales in China and immunoassays, where we don't believe it's relevant to maintain the guidance that we had before.

The rest of the guidance actually is very similar and very much in line with what we shared. BIOFIRE non RP at plus 10%, SPOTFIRE doubling sales, industrial applications around 9% and BIOFIRE respiratory panels flat, assuming a medium flu season. And I just want to highlight here that we've given the VITEK 6% to 7.5% to reflect the uncertainty of the respiratory season. Of course, as you know, Q4 '24 -- actually the end of Q4 '24 was stronger from a respiratory season perspective. So for respiratory panels, even though we show today a sales growth, we kind of expect an impact based on the epidemiology. That's for sales.

With regards to CEBIT, based on a very strong performance of H1 at 24%, we are now in a position to review guidance upwards between 12% to 18% of organic EBIT improvement. We've also revised a little bit of FX impact. Guillaume was sharing a neutral impact in H1. We still expect to see, unfortunately, an impact in H2.

But for the full year, that would be EUR 25 million, where we actually guided on EUR 35 million to EUR 40 million initially. And the last slide update to the guidance is CapEx, which we now see coming up to 9% of consolidated sales versus 10%, 11% that we mentioned at the beginning of the year. And that's pretty much it for us. So Aymeric, I think you will handle the Q&A.

Yes. We can now open the Q&A session. We will have our first question from Anchal Verma from JPMorgan.

The next question comes from Anchal Verma from JPMorgan.

Two questions from me, please. Firstly, can you elaborate a bit more on what you're seeing on the ground in microbiology in China? And given that you've upgraded guidance for the full year, but when do you expect any improvement in the market? And what sort of visibility do you have?

And then the second one is, can you help us understand the drivers of H2 margins a bit better? Can we expect gross margins to improve year-over-year in H2, perhaps at a similar magnitude to H1? And how sustainable do you think the H1 margin momentum is? Essentially trying to understand what gives you confidence in the upgraded EBIT growth guidance?

Okay. So I'll start with the first question on the dynamics in China and Guillaume will try to give a bit of color on H2 financial performance. So with regards to microbiology in China, what we are seeing -- we have to be -- what we are seeing is a very strong cost containment plan in the Chinese health care system is, that is impacting microbiology among other categories. And in microbiology, it's really reduction of stock, reduction of use of bottles.

It's a massive and drastic effort to reduce the cost in the health care system that impacts microbiology. We are not seeing volume-based pricing happening in microbiology. We are not seeing a spectacular competition move. It's really driven by the market decline. I hope that answers your question. And honestly, I mean, for the rest of the year, we are kind of assuming that it will stay like this. We are not seeing the light at the end of the tunnel for the rest of the year, hence, a revised guidance with a target 6% to 7.5% sales growth. Guillaume, do you want to give...

Yes, profitability going forward, so we -- again, as Pierre said, we factor the very strong H1 as well the prospects for H2, including, as Pierre mentioned, respiratory panel, which should be lower, especially in our assumption of a medium season means lower in Q4 than in Q4 2024. So that will have an impact on gross margin and profitability overall.

But overall, on the trends of OpEx, we expect to pursue, of course, the GO.28 efficiency trend that we are seeing and delivering with continued operating leverage as we deliver. So we factor all this into this, let's say, 12% to 18% range for the year. And again, I would say, like the top line, the main variability on the bottom line is linked to actually top line RP season effect.

The next question comes from Kavya Deshpande from UBS.

I just had a couple on SPOTFIRE, please. So the first one was just around placements. I completely understand Q2 is the seasonally weakest quarter. And maybe this time, there was a bit of additional pull forward from Japan. But considering all of this sort of maybe phasing effect, would it be reasonable to expect in Q3 that you can do a bit better than last year's Q3, so maybe like 650 placements?

And then just a follow-up. So I saw that the SPOTFIRE 15plex panel had obtained a new PLA code in the U.S. as of the 1st of July. Do you think this provides a reimbursement tailwind for that particular panel in the U.S. in H2?

So on SPOTFIRE, first question, we don't -- I mean I don't want to give specific projections on Q3, Q4. What we know by experience now is that Q4 and Q1 are the big quarters in terms of placement because that's when the respiratory season happens. Q2 is usually lower. We don't give a specific guidance for placement in Q3 or Q4 or even the full year. But what we're saying, which we feel very healthy is that we keep doubling our sales every quarter. So very much in line even if there is less epidemiology, we are saying that we are getting the traction that we need to get based on the installed base that we have.

And remember that we had a Q1 that was I think we said it, Q1 was extremely high. It was related to the one-off in Japan. So definitely difficult to compare Q1 with Q2. With regards to your next question on PLA change or market access reimbursement, it's -- the short answer to your question is the coverage of Point-of-Care respiratory panels in the U.S. is very dependent also by state.

So they are depending on the states, some states reimburse very well 15plex, some much lower depends on the conditions. The same for the 5plex. So we are not seeing -- the way I would answer your question is we are definitely not seeing any headwind with regards to reimbursement as we speak, but no specific tailwind either related to the PLA that you're mentioning that is phasing out on the 1st of July.

The next question comes from [indiscernible] from Miz.

I have two as well. My first one is on the BIOFIRE placements, which I understand you no longer provide, but could you comment on whether your U.S. installed base for BIOFIRE grew year-on-year? And what trends are you observing in the U.S. given your #2 competitor has been talking about winning a lot of U.S. business in the first half?

And then my second question is for Guillaume on the CEBIT development. Your new guidance implies around 18% margin, which is a big step-up versus 2024. If I understand correctly, this is driven by your GO.Simple program, which is ahead of schedule. But also positive mix from molecular being stronger and then micro and immuno being weaker.

So if you look into at the 2026, could you -- is there a potential that you see a reversal of this dynamic? So your GO.Simple benefits are weaker than this year and your mix normalizes to more micro and immuno. So is there a chance here where your margin also takes a step down? Not asking for guidance for '26, but just want your thoughts on the potential for a slower CEBIT growth in 2026.

Okay. That's a good question. That's a long question for Guillaume, but I'll start with the first one on BIOFIRE placement. So maybe to remind you and the whole team, but I'm sure you have it in mind, when we communicated the guidance for GO.28 plan, we actually knew the competition, and we embedded into flat sales for RP and 10% sales growth for non-RP, the fact that will be a little bit more intense competition.

So market share erosion and a bit of price erosion. So it's fully embedded into our guidance for our plan, GO.28 and obviously also for '25. So what we're seeing is very much in line with the plan that we have. And we strongly believe that actually, it's a big market, especially non-RP is a market that will keep growing. So there is room for all players. And in this big market, we still expect to grow 10%. So -- that's what I can say on the competitive dynamics.

And as I mentioned earlier, we had placements actually in H1 that were better than in H1 '24. And in the U.S., we are also seeing a positive improvement in terms of installed base. So at this stage, we -- I mean, don't take me wrong, I would love to have less competition. But at this stage, we are seeing the competition performance very compatible with what we are seeing for our own brands. CEBIT wise?

Yes, going to CEBIT and going -- first, thank you very much to recognize that you see in the figures what we had, let's say, promised and put forward with GO.Simple efficiency, which definitely is visible and probably ahead. So the initiatives as well as the mix, you're very right.

Reversal, I don't see how we could have a reversal. I mean, the mix, again, it's quite relatively obvious that molecular is growing faster than microbiology and immunoassay, even going forward in the guidance that we have given already on GO•28 trends overall, average trends. So I don't see this as any way reversal or would reverse.

And then the GO.Simple initiatives, as we mentioned, we have initiatives that are already delivering that you see in the figures that we tried to explain to give you some examples. We already also have some that are in the making, when I said design, operating model, et cetera, that will deliver over the coming, let's say, quarters and years. So more to come as well. So I don't see a way that it would reverse actually.

Okay. That's very helpful. Yes, that's very helpful. And if I can just follow up quickly with Guillaume as well on the tariffs. Can we annualize the EUR 5 million to EUR 10 million number you're expecting this year to about EUR 10 million to EUR 20 million for next year? Or do you expect some mitigation factors to come into play?

Yes. Thank you for your question on tariffs. So actually, what I mentioned is that the annualization, we did the calculation, we see EUR 35 million growth impact in 2026. We already have some actions that we have been working on to mitigate some of it. We need to continue to work and it's still very recent. And -- but we believe it's manageable in our GO•28 plan, this EUR 35 million impact. It's significant but manageable.

The next question comes from Maja Stephanie Pataki from Kepler.

I have a couple of questions, and I'll take them one by one. First of all, can we circle back to China, please? Can you remind us how big China is as a total of group and what it represents of micro and immuno at this point in time?

And then also, how big do you -- how big is the risk that China might just not return to growth? We've seen a couple of companies that have talked about softness in China before you and those companies continue to struggle. So China going ex growth, what would that do to your GO.28 guidance? And then I have another one after that.

Okay. So I'll speak on [indiscernible] and Guillaume and Aymeric can talk on the share of sales. So it's -- I think it's 5% as we speak, 6% of the group sales are in China in H1 '25. Microbiology, I would say 10-ish of sales in microbiology. So that's where it's having an impact. Now to your -- I mean, we're seeing -- again, I mean, what we're seeing is beyond the decline, it's actually -- yes, very strong decline. It's not even flat.

So what we are seeing is for the rest of the year and that led to the revised guidance, we don't see the situation improving. We are kind of assuming it will keep declining at the same pace. I think Guillaume mentioned minus 17% in H1. So we are projecting something of that nature between -- it's mostly microbiology, but microbiology and immunoassays.

And of course, we need to work on 2026 impact. It's -- at some point, it will not reduce by 20% every year -- the challenge in '25 is that we are going from a very solid growth to a very solid decline. So it's a very brutal change of dynamics. I'm not sure it's sustainable for the Chinese health care market after decline by 20% every year, but definitely something that we need to refine and work on with the teams as we prepare for 2026.

Got it. And then my second question, congrats on the strong RP sales for H1 despite the fact that you had a very tough comparison base. And if we compare the non-RP versus the RP performance of BIOFIRE, it might be a bit surprising that the RP continues to do better than the non-RP. I was trying to understand what the dynamics are there because obviously, there's probably lower penetration in the non-RP patient population. Is it just that it takes longer until those panels are being used? Or is it because competition has increased that now everyone is eating part of the cake?

Yes, it's a very good question, Maja. Maybe three answers. The first one is when you compare RP with non-RP and their relative performance in H1 2025, first of all, we had a very strong H1 -- very strong epidemiology in Q1, very, very strong, probably the strongest we've seen in many years. So we have very strong dynamics on RP, which to your point, we love and we enjoy. But we don't benefit that kind of a epidemiology boost on non-RP. Non-RP, it's more growing and educating the market. And to your point, it takes a bit of time.

So you don't have the ups and downs of the RP seasons on non-RP, which, by the way, is for the team, the manufacturing team, the supply chain teams and for our results, good news. But it's -- when you compare the two, you have to take into account that Q1 was super strong. Especially BIOFIRE. The second element that you need to have in mind is I talked about the base effect of Q1 and H1 '24. Non-RP was extremely strong in '24. It was growing 19%, way above the expectation.

So we had a very, very high basis on which to grow. So what we are seeing is it is very much in line with our plan and the 10% sales growth. Finally, to your point, it's a market that takes a little bit of time to grow. And actually, having that's probably the only area where having competition is not necessarily bad because there are more companies making noise.

And I strongly believe that be it meningitis, be it BCID be it GI, actually, there is a benefit in growing the market and having more players in the market makes more noise and is growing the market. So it takes a bit of time, and we are working on it, but progressing as we planned.

Okay. And then quickly, last question, maybe it's a bit of a philosophical question, something that you can't answer at that point in time. But what do you make out of the developments in the U.S., the debates about vaccinations, the changes at the CDC, the uncertainty that is rising, how are you -- what are the internal discussions? Are you popping something already? Or are you expecting this to be rather neutral for the group?

So I mean, from -- I have a general comment and a more specific comment from bioMérieux and the general comment is obviously, having a lower vaccination rate is not positive for fighting against the threat of infectious disease outside. It's unfortunately a scientific data. So it's -- I think it's bad news for the U.S. as we speak.

If I take a very selfish bioMérieux perspective, the challenge is if there is a big spread of pathogen and the population is very poorly vaccinated, it will generate more people in hospital. So it's -- unfortunately, it's very short term, that will be good news, but I genuinely believe that will not be a positive development for the country.

Okay. We have some online questions. The first one from Marcus Ambani, what potential midterm outside U.S., so Europe, Middle East, et cetera, for BIOFIRE and SPOTFIRE?

Okay. Thank you, Marcus. Probably takes two answers. BIOFIRE, what we've kept saying since Capital Market Day is that overall, a good 50% of the IVD market is outside of the U.S. So we should see I don't know when, but at some point, sales of BIOFIRE being split between the U.S. and ex U.S. And today, I think we're at 72%. So the room for growth outside of the U.S. is immense for BIOFIRE.

And we keep working on it. And by the way, that's still where we grow faster our installed base even if we keep growing installed base in the U.S. On SPOTFIRE, very different story because on SPOTFIRE, our plan to be transparent with you is U.S. and Japan, mostly. That's where we expect core of the immense majority of the sales to confirm.

There may be evolutions for SPOTFIRE as point-of-care testing is being developed by the health care market in the world. But as you know, in Europe, it's still very patchy. We are working on it, and these are topics of discussions that we have with public authorities on a regular basis. The development of the point-of-care market in Europe is still very nascent, and it's not assumed to develop in a good [indiscernible] plan.

Okay. Another question from Arnaud Cadart, CIC. Congrats for the H1. One question on M&A. What are your thoughts on large players like Becton Dickinson and Thermo Fisher selling or looking for selling some IVD assets? Would you be interested in some of them? Or are you purely looking at acquisition in emerging technologies like you did in the past?

Okay. So of course, we've -- I mean, Thermo Fisher is still in the process. But for BD, we've obviously witnessed in the transaction with Waters, it's a significant change for BD. So we expect a little bit of disruption between selling, closing, but we are watching.

Waters is not expensively present into the segments where we are. So we are not seeing obvious synergies on the topics that we are looking at, mostly microbiology. But of course, we'll be looking at the development of the situation as we see. And as I said, until now, H1, we had a very competitive position.

Okay. We'll come back to live question.

The next question comes from Jan Koch from Deutsche Bank.

I would also like to start with BIOFIRE. With a competitor launching a high-throughput multiplex instrument, I'm interested in your assessment of the market size for such a solution. Could you elaborate on the current utilization levels of your BIOFIRE instruments within large reference laboratories in the U.S.?

And then secondly, regarding VITEK Reveal, could you provide an update on your 2028 sales targets? And given that this business segment is probably still quite loss-making, are you planning to implement any kind of cost management measures? And then finally, on industrial applications, given that reagent assets grew by 9%, while the overall industrial segment grew by 11%, that implies about 20% growth in instruments. Could you provide further comments or color on the dynamics contributing to this strong growth?

Okay. Thank you for your good questions, and so let's start with BIOFIRE high-throughput system launched by the competition. It actually already exists in Europe. It's just been recently approved in the U.S. So we know it. It's a level of automation, actually, especially for the loading of the reagents. We see it as an interesting development, but very targeted for very few clients. I mean to go into that level of automation, you need to be a very high level user of the solutions.

It's just been recently launched. So we'll be looking at the impact on the market. And of course, we will play with what is coming. The second element -- second question on VITEK Reveal. And so you had two sub-questions actually, 2028 target. So what we've actually decided to do is to -- the 2028 target for Reveal was already embedded into a microbiology sales. It was not on top of. So the way instead of giving you a target and reviewing, we don't do it for any other microbiology product is we'll keep a 6% to 8% target for microbiology in the GO•28 plan, which we believe is very relevant target, including a lower number for VITEK Reveal.

It will work. It doesn't have a massive impact to the total sales of VITEK Reveal on the total sales for the group. So we think it's still manageable. And maybe two comments on your third question because -- sorry, on your sub questions on cost management. On the top line, I want to highlight the fact that beyond -- when you do the impairment test and I speak under the control of Guillaume's overlook the impairment test process, we look at the assets in isolation.

But the improvement that it brings to the overall offering of bioMérieux in microbiology and capacity to show that we are leader, that we bring innovation, even if VITEK Reveal doesn't bring as much as we expected initially is still very valuable. And it shows in the discussion that we have with the microbiology labs every day. So as Guillaume said, we'll keep working on developing it. We see it as a very strategic offering that brings significant medical value.

So we are working very diligently to make it a success. And it has already a positive impact on the perspective of bioMérieux offering in microbiology. Now you're rightly raising the point of managing cost in a context where the sales are not at the level we expect. We've already made the decision to accelerate the integration of the specific diagnostics company that was the origin of VITEK Reveal into bioMérieux and the R&D organization of VITEK Reveal is now reporting into the microbiology team of bioMérieux so that we fully leverage the expertise, the capabilities and we generate some efficiencies on working together.

So that's the very first step to better manage the cost in the context of a top line, which is not where we wanted it to be. Finally, industrial applications, a very fair point. We are actually growing faster on instruments than on reagents. It actually echo the comment I was making that what's very positive in the growth of industrial applications is that our new solutions are very successful.

So it comes together with successful new installations, new systems that will pave the way for future growth in reagents. So very healthy sales growth that, to your point, is not only coming from reagents, also from a very nice increase of our installed base of [indiscernible].

The next question comes from Natalia Webster from RBC.

Just a couple of follow-ups on the microbiology outlook, please. Firstly, just outside of China, you previously talked around some issues around the demand for blood culture also in other regions, including the U.S. in Q1. Just curious to see if this has improved in Q2 and if you'd say that this market has now normalized ex China.

Secondly, just following up on that question around the GO.28 target. You seem to still be happy with the 6% to 8% for microbiology as a whole despite the downgrade to 3% this year. So are you just able to comment a bit more about how your other launches are going and what you really expect to drive this in '26 to '28 given the lower expectations for VITEK Reveal?

And then finally, just a confirmation around the CEBIT guidance. Just wanted to check that the tariff impact will be included within the underlying CEBIT guidance for the full year and also for the midterm.

I am going to take the easiest one. You can start with the last one. Guillaume?

Yes. So yes, on the last one, CEBIT guidance, so yes, we confirm that we include in the 2025 upward revised guidance, the tariff impact that we estimate EUR 5 million to EUR 10 million, so that's included. And again, our message on the long midterm is that we believe that the EUR 35 million growth is significant but manageable with mitigations actions and inside the overall targets of GO•28.

So on your questions for microbiology, so as you said very rightly, outside of China, microbiology is growing 6%, which is a very decent sales growth. It's at the bottom end of our 6% to 8% GO•28 target. So it's very reasonable. You have to remember that 2024 was actually very strong. We are actually above the top, above 8%. So I mean, unfortunately, I would love to be in control of the market evolution, but there will be stronger year and lower years. So really in terms of -- for us, it's very much in the spirit of the GO•28 target.

And this year will be a little bit slower because of China. The other element is you are coming back to the blood culture kind of crisis. I would not say the market is fully normalized yet. We are -- what we are seeing is it's very much depending on the geographies because a competitor got into back order, not in every country at once. So some countries were more impacted than others. And in the countries that were impacted, even though the supply is now normalized from the competitor, as you know, there was no back order on our side.

There are still a bit of restrictive use of bottles, I would call it this way. We are seeing clients being a little bit careful, making sure that they use the minimum level of bottles to not put themselves into danger. So I think it will take probably a few quarters to get back to a full normal use. And again, we were building on actually a very dynamic 2024. So there is also a point of comparison for '25, which was a bit higher. Your question on VITEK Reveal, no, no specific questions [indiscernible].

Some more question online, some question from Christophe Rafael from ODDO. On the headcount for how long do we expect to limit the increase in FTEs or in headcount? India, can we get an update on the market share percentage of sales, level of profitability? I think we don't disclose those details on a country basis. And BIOFIRE, can we have the split between RP and non-RP for H1?

So I can start with the headcount evolution because as you know, we actually -- when we published 2024, we communicated [ zero percentage ] additional headcount in 2024. This first half, we are at around 2%. There is no plan actually to limit it. It's not ask that is made to the teams. What we are doing and Guillaume alluded to that in the simple description is we are working on improving efficiency.

So when we get more efficient, by then we don't need to recruit more people because you manage to actually absorb the workload of the additional work with the people that you have. So when we need to recruit, when we want -- when and where we want to increase the capabilities, we do. And there are some areas where we actually invest and have more people, but some other areas that we're reducing an obvious one is Guillaume alluded to automation of BIOFIRE, where when you automate the manufacturing of BIOFIRE reagents, you reduce quite significantly actually the number of people that are employed on the right.

So it has an impact also on the total evolution of headcount. So it's not an objective, but it's definitely an indicator of efficiency in my mind that shows into the improvement of the profitability.

And now-- so RP is actually 60% --6-0, 60% of our RP non-RP BIOFIRE panels sales overall in H1.

We have one question from Ed on -- so you have now impaired specific diagnostic, but not fully. Is there an idea we could see further impairment down the line? And what are the criteria here? So maybe for you Guillaume.

Yes. So to remind everyone, it's a partial impairment, about 2/3 of the value that is tested. The goodwill is not tested. The goodwill is part of the overall microbiology goodwill. So the value that is left remaining on the books is about EUR 80 million. And of course, the criteria for further impairment would be to have another, let's say, slower or lower than planned performance in the coming years.

And another question from Ed was margin progress was quite stellar. Can you break down the 200 bps improvement? How much was pricing? How much was mix and how much is efficiency from operating leverage from SG&A?

Thank you very much for the recognition of the stellar margin improvement. In terms of mix, we try to give you the different elements on not exactly as the split of the 200, but yet on the price, we mentioned about 2% price improvement on microbiology and on the industry applications and a slight small erosion of price on the respiratory panels, flat for the rest. And on the mix, we mentioned that it has -- it's a significant part of the 80 bps of gross margin improvement in H1.

And that's it. So maybe one last question from Edward. Do you expect to benefit from the One Big Beautiful Bill in the U.S. on the R&D and CapEx side? Do you expect, sorry, any temporary tailwind to P&L tax rate, cash tax outflow?

Thank you for the question. Indeed, we don't expect much on the R&D CapEx side, except there is some cut on the R&D tax credit in the U.S., but not very significant for bioMérieux. Overall, it's manageable.

What is very positive is more the cash side of tax, which not to make it too complex, but drives for an expense in tax -- an expense of the R&D year-on-year, whereas the U.S. administration previously was on a capitalization, depreciation of R&D expense, which will basically with the transition, have possibly a very positive impact in terms of cash outflow, tax outflow, very positive impact in 2025 and 2026. So we'll come back to that in the full year, but we should expect a very positive inflow there.

Okay. Thank you, Guillaume. And with that, if there is no more question, we can close the call. Talk to you soon and most probably for all of you on November 3 for the presentation of the Q3 financial performance.

Thank you very much. Have a good day and good afternoon. Bye-bye.