Water analytics and treatment company Veralto (NYSE:VLTO) reported Q1 CY2025 results topping the market’s revenue expectations , with sales up 6.9% year on year to $1.33 billion. On the other hand, next quarter’s revenue guidance of $1.32 billion was less impressive, coming in 1.3% below analysts’ estimates. Its non-GAAP profit of $0.95 per share was 9.4% above analysts’ consensus estimates.
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Veralto (VLTO) Q1 CY2025 Highlights:
StockStory’s Take
Veralto’s first quarter results were propelled by strong execution across its core water analytics and product quality infrastructure (PQI) segments. Management attributed the growth to disciplined commercial strategies, successful new customer wins, and a broad-based increase in demand across geographies and end markets. CEO Jennifer Honeycutt highlighted that both recurring revenue streams and equipment sales contributed significantly, with the marking and coding business delivering its fourth consecutive quarter of year-over-year growth in both consumables and equipment. The company also benefited from operational improvements and recent acquisitions, including TraceGains, which is tracking in line with expectations.
Looking forward, Veralto maintained its full-year adjusted EPS outlook, but next quarter’s revenue guidance was described as cautious in light of shifting global trade and tariff dynamics. Management emphasized ongoing countermeasures to offset tariff risks, including strategic pricing, supply chain adjustments, and a new U.S. manufacturing facility to increase flexibility. CFO Sameer Ralhan acknowledged that while demand trends remain steady, the company is modeling a range of scenarios to address potential headwinds from tariffs and global market uncertainties.
Key Insights from Management’s Remarks
Veralto’s management credited the quarter’s performance to both strategic actions and favorable market conditions. The company’s approach to mitigating external risks and driving organic growth was a key theme throughout the call.
Drivers of Future Performance
Management’s outlook for the coming quarters is shaped by global trade uncertainties, tariff impacts, and the resilience of core end markets like water treatment and consumer goods.
Top Analyst Questions
Catalysts in Upcoming Quarters
Over the next few quarters, the StockStory team will be monitoring (1) the effectiveness of Veralto’s tariff mitigation strategies and how quickly margin stability is restored, (2) continued demand trends in core water treatment and PQI markets as macroeconomic conditions evolve, and (3) the pace and impact of new product introductions and acquisition integrations, particularly with AQUAFIDES. We will also watch for any changes in recurring revenue trends and updates on capital deployment priorities.
Veralto currently trades at a forward P/E ratio of 27×. In the wake of earnings, is it a buy or sell? The answer lies in our free research report .
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