Reported results
- Revenue of $1.066 billion, up 1% year-over-year on a reported basis, up 1% in constant currency, and up 1% organically.
- GAAP diluted EPS of $2.24, compared with $0.49 in last year’s third quarter, primarily driven by a $307.2 million discrete tax benefit from favorable completion of a U.K. tax examination.
- Non-GAAP diluted EPS of $1.15, up 4% from last year’s third quarter.
- Free cash flow of $273.0 million, up 66% from last year’s third quarter (cash provided by operations of $341.7 million less capital expenditures of $68.7 million).
- GAAP gross margin of 67% compared with 65% in last year’s third quarter; non-GAAP gross margin of 67%, down 60 basis points year-over-year.
- GAAP operating margin of 21% compared with 17% in last year’s third quarter; non-GAAP operating margin of 26%, up 30 basis points year-over-year.
Guidance
- Fiscal Q4 2026 total revenue of $1.057 - $1.080 billion (organic growth of 0% to 2%)
- Fiscal Q4 2026 non-GAAP diluted EPS of $1.05 - $1.09
- Fiscal 2026 total revenue of $4.229 - $4.252 billion (organic growth of 2% to 3%)
- Fiscal 2026 non-GAAP diluted EPS of $4.51 - $4.55
- Long-term free cash flow objective exceeding $2.2 billion for fiscal years 2026 through 2028 (reaffirmed)
Notes
The company recognized a $307.2 million discrete tax benefit in Q3 2026 following the favorable completion of a U.K. tax authority (HMRC) examination of the company’s fiscal 2021 transfer of intellectual property and related assets to the United Kingdom, with no proposed adjustments. This was the primary driver of the lower GAAP effective tax rate for the quarter. The company completed its strategic review process and announced actions to enhance shareholder value in a separate press release. Channel inventory reduction at CooperVision in Q3 weighed on results and is expected to continue impacting Q4.
Price and volatility reaction
The stock moved -14.7% on the print. No front-expiry chain was on file, so there is no straddle expected move. 30-day ATM implied volatility moved +4.4 vol points across the event (constant-maturity series — not the front-week crush).
| Measure | Value | Basis |
|---|---|---|
| Close before release | 63.48 | 2026-09-09 |
| Close after release | 54.17 | 2026-09-10 |
| Realised move | -14.7% | close to close |
| 30d ATM IV change | +4.4 vol pts | constant-maturity series, not the front expiry |
Source
The figures above come from the earnings release the company filed with the SEC on 2026-09-09 (8-K, Item 2.02). Read the original filing on sec.gov.