THERMO FISHER SCIENTIFIC INC. (TMO) · Material Event (8-K) SEC Filing

EX-99.1 2 q22026earnings8kex99_1.htm EX-99.1 DocumentExhibit 99.1 News Media Contact Information Sandy PoundThermo Fisher Scientific Investor Contact Information Rafael Tejada Thermo Fisher Scientific Phone 781-622-1223 Phone 781-622-1356 E-mail sandy.pound thermofisher.com E-mail rafael.tejada thermofisher.com Thermo Fisher Scientific Reports Second Quarter 2026 ResultsRevenue Grew 10% Including 5% Organic Revenue GrowthGrew GAAP Diluted EPS 9% and Adjusted EPS 13%Customer Activity Across Our End Markets Continued to StrengthenWALTHAM, Mass. (July 23, 2026) Thermo Fisher Scientific Inc. (NYSE TMO), the world leader in serving science, today reported its financial results for the second quarter ended June 27, 2026.Second Quarter Highlights Second quarter revenue grew 10% to $11.99 billion Second quarter GAAP diluted earnings per share (EPS) grew 9% to $4.68 Second quarter adjusted EPS grew 13% to $6.03 We delivered outstanding performance in the second quarter, reflecting the strength of our proven growth strategy, our team s excellent execution and the power of our PPI Business System, said Marc N. Casper, chairman and chief executive officer of Thermo Fisher Scientific. Our end markets continue to strengthen and we're making great progress enhancing our capabilities, and further advancing our trusted partner status with customers, leading to continued share gain. Casper added, At the halfway point of the year, we are well positioned to deliver a great 2026 and build an even brighter future for our company. Growth Strategy and Capital Deployment Advanced our proven growth strategy, launching a range of high-impact, innovative new products during the quarter. At the American Society for Mass Spectrometry conference, we introduced next-generation Orbitrap platforms with AI-driven analytics. Highlights include the Thermo Scientific Orbitrap Tribrid Apex Mass Spectrometer, which enables researchers to study complex biology across multiomics, structural biology, biopharma characterization and small-molecule analysis on a single system, and the Thermo Scientific Orbitrap Excedion Mass Spectrometer, which enables scientists to identify hard-to-detect molecules in drug development, reducing risk and accelerating time to market. We also introduced the Applied Biosystems PowerFlex Thermal Cycler, a next-generation PCR system designed to improve workflow flexibility, speed and reproducibility for molecular biology laboratories. Strengthened our industry-leading commercial engine and deepened our trusted partner status with customers. During the quarter, we opened our flagship U.S. Bioprocess Design Center in Plainville, Massachusetts, expanding our global network of collaborative innovation hubs enabling pharma and biotech customers to accelerate drug development and optimize manufacturing. We also announced a strategic collaboration with Precision Health Research, Singapore to support the PRECISE-SG100K population health study, leveraging our integrated proteomics capabilities, including Olink technology and the Thermo Scientific Orbitrap Astral mass spectrometry system, to advance precision medicine. Continued to successfully execute our capital deployment strategy. During the quarter, we announced the divestiture of our microbiology business and repurchased $1.0 billion of stock.Financial ResultsRevenue for the second quarter of 2026 grew 10% to $11.99 billion, versus $10.85 billion in the same quarter of 2025. Organic revenue growth was 5%.GAAP Earnings ResultsGAAP diluted EPS in the second quarter of 2026 was $4.68, 9% growth versus the second quarter of 2025. GAAP operating income for the second quarter of 2026 was $2.09 billion, 14% higher than the year-ago quarter. GAAP operating margin was 17.4%, compared with 16.9% in the second quarter of 2025.Non-GAAP Earnings ResultsAdjusted EPS for the second quarter of 2026 was $6.03, 13% growth versus the second quarter of 2025. Adjusted operating income for the second quarter of 2026 was $2.73 billion, 15% higher than the year-ago quarter. Adjusted operating margin was 22.8%, compared with 21.9% in the second quarter of 2025.Annual Guidance for 2026The company will provide updated 2026 financial guidance during its earnings conference call this morning at 8 30 a.m. Eastern Time.Use of Non-GAAP Financial MeasuresAdjusted EPS, adjusted net income, adjusted operating income, adjusted operating margin, free cash flow, and organic revenue growth are non-GAAP measures that exclude certain items detailed after the tables that accompany this press release, under the heading Supplemental Information Regarding Non-GAAP Financial Measures. The reconciliations of GAAP to non-GAAP financial measures are provided in the tables that accompany this press release. Note on PresentationCertain amounts and percentages reported within this press release are presented and calculated based on underlying unrounded amounts. As a result, the sum of components may not equal corresponding totals due to rounding.Conference Call Thermo Fisher Scientific will hold its earnings conference call today, July 23, 2026, at 8 30 a.m. Eastern Time. During the call, the company will discuss its financial performance, as well as future expectations. The call will be webcast live on the Investors section of our website, www.thermofisher.com. You can access the conference call by dialing (833) 461-5787 within the U.S. or +1 (585) 542-9983 outside the U.S. The access code is 835035800. The earnings press release and related information can also be found on the Investor Relations section of our website, under the heading Financials . A replay of the call will be available under News, Events Presentations through Tuesday, October 20, 2026. About Thermo Fisher ScientificThermo Fisher Scientific Inc. is the world leader in serving science, with annual revenue over $45 billion. Our Mission is to enable our customers to make the world healthier, cleaner and safer. Whether our customers are accelerating life sciences research, solving complex analytical challenges, increasing productivity in their laboratories, improving patient health through diagnostics or the development and manufacture of life-changing therapies, we are here to support them. Our global team delivers an unrivaled combination of innovative technologies, purchasing convenience and pharmaceutical services through our industry-leading brands, including Thermo Scientific, Applied Biosystems, Invitrogen, Gibco, Fisher Scientific, Unity Lab Services, Patheon and PPD. For more information, please visit www.thermofisher.com.Safe Harbor StatementThe following constitutes a Safe Harbor statement under the Private Securities Litigation Reform Act of 1995 This press release contains forward-looking statements that involve a number of risks and uncertainties. Important factors that could cause actual results to differ materially from those indicated by forward-looking statements include risks and uncertainties relating to the need to develop new products and adapt to significant technological change implementation of strategies for improving growth general economic conditions and related uncertainties dependence on customers' capital spending policies and government funding policies the effect of economic and political conditions and exchange rate fluctuations on international operations use and protection of intellectual property the effect of changes in governmental regulations any natural disaster, public health crisis or other catastrophic event and the effect of laws and regulations governing government contracts, as well as the possibility that expected benefits related to recent or pending acquisitions, may not materialize as expected. Additional important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are set forth in our most recent reports on Form 10-K and Form 10-Q under the heading Risk Factors. These filings are on file with the SEC and available in the Investors section of our website under the heading SEC Filings. These forward-looking statements are based on our current expectations and speak only as of the date of this press release. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, in the event of new information, future developments or otherwise.### Condensed Consolidated Statements of Income (unaudited) Three months ended June 27, % of June 28, % of (Dollars in millions except per share amounts) 2026 Revenues 2025 Revenues Revenues $ 11,994 $ 10,855 Costs and operating expenses Cost of revenues (a) 7,051 58.8 % 6,378 58.8 % Selling, general and administrative expenses (b) 1,909 15.9 % 1,779 16.4 % Amortization of acquisition-related intangible assets 485 4.0 % 429 4.0 % Research and development expenses 364 3.0 % 352 3.2 % Restructuring and other costs (c) 98 0.8 % 82 0.8 % Total costs and operating expenses 9,907 82.6 % 9,021 83.1 % Operating income 2,087 17.4 % 1,834 16.9 % Interest income 207 297 Interest expense (401) (404) Other income (expense) (d) 31 (19) Income before income taxes 1,924 1,709 Benefit from (provision for) income taxes (e) (167) (92) Equity in earnings (losses) of unconsolidated entities (15) 2 Net income 1,741 1,618 Less net income (loss) attributable to noncontrolling interests and redeemable noncontrolling interest (f) 5 2 Net income attributable to Thermo Fisher Scientific Inc. $ 1,736 14.5 % $ 1,617 14.9 % Earnings per share attributable to Thermo Fisher Scientific Inc. Basic $ 4.68 $ 4.28 Diluted $ 4.68 $ 4.28 Weighted average shares Basic 371 378 Diluted 371 378 Reconciliation of adjusted operating income and adjusted operating margin GAAP operating income $ 2,087 17.4 % $ 1,834 16.9 % Cost of revenues adjustments (a) 28 0.2 % 10 0.1 % Selling, general and administrative expenses adjustments (b) 36 0.3 % 20 0.2 % Restructuring and other costs (c) 98 0.8 % 82 0.8 % Amortization of acquisition-related intangible assets 485 4.0 % 429 4.0 % Adjusted operating income (non-GAAP measure) $ 2,735 22.8 % $ 2,375 21.9 % Reconciliation of adjusted net income GAAP net income attributable to Thermo Fisher Scientific Inc. $ 1,736 $ 1,617 Cost of revenues adjustments (a) 28 10 Selling, general and administrative expenses adjustments (b) 36 20 Restructuring and other costs (c) 98 82 Amortization of acquisition-related intangible assets 485 429 Other income expense adjustments (d) (31) 5 Income taxes adjustments (e) (127) (133) Equity in earnings losses of unconsolidated entities 15 (2) Noncontrolling interests adjustments (f) (1) Adjusted net income (non-GAAP measure) $ 2,241 $ 2,026 Reconciliation of adjusted earnings per share GAAP diluted EPS attributable to Thermo Fisher Scientific Inc. $ 4.68 $ 4.28 Cost of revenues adjustments (a) 0.07 0.03 Selling, general and administrative expenses adjustments (b) 0.10 0.05 Restructuring and other costs (c) 0.27 0.22 Amortization of acquisition-related intangible assets 1.31 1.14 Other income expense adjustments (d) (0.08) 0.01 Income taxes adjustments (e) (0.34) (0.35) Equity in earnings losses of unconsolidated entities 0.04 (0.01) Noncontrolling interests adjustments (f) 0.00 Adjusted EPS (non-GAAP measure) $ 6.03 $ 5.36 Reconciliation of free cash flow GAAP net cash provided by operating activities $ 2,125 $ 1,399 Purchases of property, plant and equipment (450) (294) Proceeds from sale of property, plant and equipment 3 1 Free cash flow (non-GAAP measure) $ 1,678 $ 1,105 Business Segment Information Three months ended June 27, % of June 28, % of (Dollars in millions) 2026 Revenues 2025 Revenues Revenues Life Sciences Solutions $ 2,815 23.5 % $ 2,499 23.0 % Analytical Instruments 1,847 15.4 % 1,728 15.9 % Specialty Diagnostics 1,205 10.0 % 1,134 10.4 % Laboratory Products and Biopharma Services 6,693 55.8 % 5,995 55.2 % Eliminations (565) -4.7 % (501) -4.6 % Consolidated revenues $ 11,994 100.0 % $ 10,855 100.0 % Segment income and segment income margin Life Sciences Solutions $ 1,041 37.0 % $ 919 36.8 % Analytical Instruments 424 23.0 % 325 18.8 % Specialty Diagnostics 334 27.7 % 306 27.0 % Laboratory Products and Biopharma Services 936 14.0 % 825 13.8 % Subtotal reportable segments 2,735 22.8 % 2,375 21.9 % Cost of revenues adjustments (a) (28) -0.2 % (10) -0.1 % Selling, general and administrative expenses adjustments (b) (36) -0.3 % (20) -0.2 % Restructuring and other costs (c) (98) -0.8 % (82) -0.8 % Amortization of acquisition-related intangible assets (485) -4.0 % (429) -4.0 % Consolidated GAAP operating income $ 2,087 17.4 % $ 1,834 16.9 % (a) Adjusted results exclude accelerated depreciation on manufacturing assets to be abandoned due to facility consolidations. Adjusted results in 2026 also exclude $6 of transaction-related costs. Adjusted results in 2025 also exclude $5 of charges for the sale of inventory revalued at the date of acquisition. (b) Adjusted results exclude certain third-party expenses, principally transaction integration costs, charges credits for changes in estimates of contingent acquisition consideration, and accelerated depreciation on fixed assets to be abandoned due to facility consolidations.(c) Adjusted results exclude restructuring and other costs consisting principally of severance, impairments of long-lived assets, net charges credits for pre-acquisition litigation and other matters, net gains losses on the sale of real estate, and abandoned facility and other expenses of headcount reductions and real estate consolidations.(d) Adjusted results exclude net gains losses on investments. Adjusted results in 2026 and 2025 also exclude $6 of business interruption recoveries and $5 for settlement charges for pension plans, respectively.(e) Adjusted results exclude incremental tax impacts for the reconciling items between GAAP and adjusted net income, incremental tax impacts as a result of tax rate law changes and the tax impacts from audit settlements.(f) Adjusted results in 2025 exclude the incremental impacts for the reconciling items between GAAP and adjusted net income attributable to noncontrolling interests.Note Consolidated depreciation expense is $331 and $256 in 2026 and 2025, respectively. Organic revenue growth Three months ended June 27, 2026 Revenue growth 10 % Acquisitions 5 % Currency translation 1 % Organic revenue growth (non-GAAP measure) 5 % Note For more information related to non-GAAP financial measures, refer to the section titled Supplemental Information Regarding Non-GAAP Financial Measures of this release. Condensed Consolidated Statements of Income (unaudited) Six months ended June 27, % of June 28, % of (Dollars in millions except per share amounts) 2026 Revenues 2025 Revenues Revenues $ 22,999 $ 21,219 Costs and operating expenses Cost of revenues (a) 13,580 59.0 % 12,435 58.6 % Selling, general and administrative expenses (b) 3,707 16.1 % 3,500 16.5 % Amortization of acquisition-related intangible assets 915 4.0 % 859 4.0 % Research and development expenses 700 3.0 % 695 3.3 % Restructuring and other costs (c) 147 0.6 % 180 0.9 % Total costs and operating expenses 19,049 82.8 % 17,668 83.3 % Operating income 3,950 17.2 % 3,551 16.7 % Interest income 440 501 Interest expense (755) (707) Other income (expense) (d) 22 (16) Income before income taxes 3,658 3,329 Benefit from (provision for) income taxes (e) (238) (187) Equity in earnings (losses) of unconsolidated entities (23) (12) Net income 3,397 3,130 Less net income (loss) attributable to noncontrolling interests and redeemable noncontrolling interest (f) 10 6 Net income attributable to Thermo Fisher Scientific Inc. $ 3,387 14.7 % $ 3,124 14.7 % Earnings per share attributable to Thermo Fisher Scientific Inc. Basic $ 9.11 $ 8.27 Diluted $ 9.10 $ 8.26 Weighted average shares Basic 372 378 Diluted 372 378 Reconciliation of adjusted operating income and adjusted operating margin GAAP operating income $ 3,950 17.2 % $ 3,551 16.7 % Cost of revenues adjustments (a) 42 0.2 % 21 0.1 % Selling, general and administrative expenses adjustments (b) 79 0.3 % 34 0.2 % Restructuring and other costs (c) 147 0.6 % 180 0.9 % Amortization of acquisition-related intangible assets 915 4.0 % 859 4.0 % Adjusted operating income (non-GAAP measure) $ 5,133 22.3 % $ 4,644 21.9 % Reconciliation of adjusted net income GAAP net income attributable to Thermo Fisher Scientific Inc. $ 3,387 $ 3,124 Cost of revenues adjustments (a) 42 21 Selling, general and administrative expenses adjustments (b) 79 34 Restructuring and other costs (c) 147 180 Amortization of acquisition-related intangible assets 915 859 Other income expense adjustments (d) (29) 4 Income taxes adjustments (e) (296) (256) Equity in earnings losses of unconsolidated entities 23 12 Noncontrolling interests adjustments (f) (1) Adjusted net income (non-GAAP measure) $ 4,269 $ 3,976 Reconciliation of adjusted earnings per share GAAP diluted EPS attributable to Thermo Fisher Scientific Inc. $ 9.10 $ 8.26 Cost of revenues adjustments (a) 0.11 0.06 Selling, general and administrative expenses adjustments (b) 0.21 0.09 Restructuring and other costs (c) 0.40 0.48 Amortization of acquisition-related intangible assets 2.46 2.27 Other income expense adjustments (d) (0.08) 0.01 Income taxes adjustments (e) (0.79) (0.68) Equity in earnings losses of unconsolidated entities 0.06 0.03 Noncontrolling interests adjustments (f) 0.00 Adjusted EPS (non-GAAP measure) $ 11.47 $ 10.51 Reconciliation of free cash flow GAAP net cash provided by operating activities $ 3,317 $ 2,122 Purchases of property, plant and equipment (826) (656) Proceeds from sale of property, plant and equipment 13 13 Free cash flow (non-GAAP measure) $ 2,503 $ 1,479 Business Segment Information Six months ended June 27, % of June 28, % of (Dollars in millions) 2026 Revenues 2025 Revenues Revenues Life Sciences Solutions $ 5,450 23.7 % $ 4,840 22.8 % Analytical Instruments 3,563 15.5 % 3,446 16.2 % Specialty Diagnostics 2,346 10.2 % 2,282 10.8 % Laboratory Products and Biopharma Services 12,729 55.3 % 11,635 54.8 % Eliminations (1,089) -4.7 % (983) -4.6 % Consolidated revenues $ 22,999 100.0 % $ 21,219 100.0 % Segment income and segment income margin Life Sciences Solutions $ 1,994 36.6 % $ 1,753 36.2 % Analytical Instruments 779 21.9 % 724 21.0 % Specialty Diagnostics 646 27.6 % 610 26.7 % Laboratory Products and Biopharma Services 1,714 13.5 % 1,557 13.4 % Subtotal reportable segments 5,133 22.3 % 4,644 21.9 % Cost of revenues adjustments (a) (42) -0.2 % (21) -0.1 % Selling, general and administrative expenses adjustments (b) (79) -0.3 % (34) -0.2 % Restructuring and other costs (c) (147) -0.6 % (180) -0.9 % Amortization of acquisition-related intangible assets (915) -4.0 % (859) -4.0 % Consolidated GAAP operating income $ 3,950 17.2 % $ 3,551 16.7 % (a) Adjusted results exclude accelerated depreciation on manufacturing assets to be abandoned due to facility consolidations and charges (credits) for the sale of inventory revalued at the date of acquisition. Adjusted results in 2026 also exclude $9 of transaction-related costs.(b) Adjusted results exclude certain third-party expenses, principally transaction integration costs, charges credits for changes in estimates of contingent acquisition consideration, and accelerated depreciation on fixed assets to be abandoned due to facility consolidations. (c) Adjusted results exclude restructuring and other costs consisting principally of severance, impairments of long-lived assets, net charges credits for pre-acquisition litigation and other matters, net gains losses on the sale of real estate, and abandoned facility and other expenses of headcount reductions and real estate consolidations.(d) Adjusted results exclude net gains losses on investments. Adjusted results in 2026 and 2025 also exclude $6 of business interruption recoveries and $5 for settlement charges for pension plans, respectively.(e) Adjusted results exclude incremental tax impacts for the reconciling items between GAAP and adjusted net income, incremental tax impacts as a result of tax rate law changes and the tax impacts from audit settlements.(f) Adjusted results in 2025 exclude the incremental impacts for the reconciling items between GAAP and adjusted net income attributable to noncontrolling interests.Note Consolidated depreciation expense is $638 and $532 in 2026 and 2025, respectively. Organic revenue growth Six months ended June 27, 2026 Revenue growth 8 % Acquisitions 4 % Currency translation 2 % Organic revenue growth (non-GAAP measure) 3 % Note For more information related to non-GAAP financial measures, refer to the section titled Supplemental Information Regarding Non-GAAP Financial Measures of this release. Condensed Consolidated Balance Sheets (unaudited) June 27, December 31, (In millions) 2026 2025 Assets Current assets Cash and cash equivalents $ 4,064 $ 9,852 Short-term investments 253 Accounts receivable, net 9,451 8,900 Inventories 5,627 5,425 Other current assets 4,224 4,278 Total current assets 23,365 28,707 Property, plant and equipment, net 10,755 10,565 Acquisition-related intangible assets, net 18,606 15,838 Other assets 5,616 5,871 Goodwill 54,832 49,362 Total assets $ 113,174 $ 110,343 Liabilities, redeemable noncontrolling interest and equity Current liabilities Short-term obligations and current maturities of long-term obligations $ 3,368 $ 3,533 Other current liabilities 11,701 11,656 Total current liabilities 15,069 15,189 Other long-term liabilities 6,116 5,766 Long-term obligations 39,181 35,852 Redeemable noncontrolling interest 121 122 Total equity 52,686 53,415 Total liabilities, redeemable noncontrolling interest and equity $ 113,174 $ 110,343 Condensed Consolidated Statements of Cash Flows (unaudited) Six months ended June 27, June 28, (In millions) 2026 2025 Operating activities Net income $ 3,397 $ 3,130 Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization 1,552 1,391 Change in deferred income taxes (466) (601) Other net non-cash expenses 370 354 Changes in assets and liabilities, excluding the effects of acquisitions (1,537) (2,151) Net cash provided by operating activities 3,317 2,122 Investing activities Purchases of property, plant and equipment (826) (656) Proceeds from sale of property, plant and equipment 13 13 Proceeds from cross-currency interest rate swap interest settlements 187 134 Acquisitions, net of cash acquired (8,872) Purchases of investments (35) (311) Proceeds from sales and maturities of investments 253 6 Net proceeds from terminations of cross-currency interest rate swaps 481 Other investing activities, net 1 Net cash used in investing activities (8,797) (815) Financing activities Net proceeds from issuance of debt 5,238 2,840 Repayment of debt (1,412) (1,625) Proceeds from issuance of commercial paper 389 Repayment of commercial paper (389) Purchases of company common stock (4,000) (2,000) Dividends paid (337) (311) Other financing activities, net 33 3 Net cash used in financing activities (478) (1,093) Exchange rate effect on cash 176 348 Increase (decrease) in cash, cash equivalents and restricted cash (5,782) 563 Cash, cash equivalents and restricted cash at beginning of period 9,879 4,040 Cash, cash equivalents and restricted cash at end of period $ 4,096 $ 4,603 Free cash flow (non-GAAP measure) $ 2,503 $ 1,479 Note For more information related to non-GAAP financial measures, refer to the section titled Supplemental Information Regarding Non-GAAP Financial Measures of this release. Supplemental Information Regarding Non-GAAP Financial MeasuresIn addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), we use certain non-GAAP financial measures such as organic revenue growth, which is reported revenue growth, excluding the impacts of acquisitions divestitures and the effects of currency translation. We report these measures because Thermo Fisher management believes that in order to understand the company s short-term and long-term financial trends, investors may wish to consider the impact of acquisitions divestitures, and or foreign currency translation on revenues. Thermo Fisher management uses these measures to forecast and evaluate the operational performance of the company as well as to compare revenues of current periods to prior periods.We report adjusted operating income, adjusted operating margin, adjusted net income, and adjusted EPS. We believe that the use of these non-GAAP financial measures, in addition to GAAP financial measures, helps investors to gain a better understanding of our core operating results and future prospects, consistent with how management measures and forecasts the company s core operating performance, especially when comparing such results to previous periods, forecasts, and to the performance of our competitors. Such measures are also used by management in their financial and operating decision-making and for compensation purposes. To calculate these measures we exclude, as applicable Certain transaction-related costs, including charges for the sale of inventories revalued at the date of acquisition, significant transaction-related third-party costs, changes in estimates of contingent acquisition-related consideration, and other costs associated with obtaining short-term financing commitments for pending recent acquisitions. We exclude these costs because we do not believe they are indicative of our normal operating costs. Costs income associated with restructuring activities and large-scale abandonments of product lines, such as reducing overhead and consolidating facilities. We exclude these costs because we believe that the costs related to restructuring activities are not indicative of our normal operating costs. Equity in earnings losses of unconsolidated entities impairments of long-lived assets and certain other gains and losses that are either isolated or cannot be expected to occur again with any predictability, including gains losses on investments, the sale of businesses, product lines, and real estate, significant litigation-related matters, curtailments settlements of pension plans, and the early retirement of debt. We exclude these items because they are outside of our normal operations and or, in certain cases, are difficult to forecast accurately for future periods. The expense associated with the amortization of acquisition-related intangible assets because a significant portion of the purchase price for acquisitions may be allocated to intangible assets that have lives of up to 20 years. Exclusion of the amortization expense allows comparisons of operating results that are consistent over time for both our newly acquired and long-held businesses and with both acquisitive and non-acquisitive peer companies. The noncontrolling interest and tax impacts of the above items and the impact of significant tax audits or events (such as changes in deferred taxes from enacted tax rate law changes), the latter of which we exclude because they are outside of our normal operations and difficult to forecast accurately for future periods.We report free cash flow, which is operating cash flow less net capital expenditures, to provide a view of the continuing operations ability to generate cash for use in acquisitions and other investing and financing activities. The company also uses this measure as an indication of the strength of the company. Free cash flow is not a measure of cash available for discretionary expenditures since we have certain non-discretionary obligations such as debt service that are not deducted from the measure.Thermo Fisher Scientific does not provide GAAP financial measures on a forward-looking basis because we are unable to predict with reasonable certainty and without unreasonable effort items such as the timing and amount of future restructuring actions, transaction-related charges as well as gains or losses from sales of real estate and businesses, the early retirement of debt and the outcome of legal proceedings. The timing and amount of these items are uncertain and could be material to Thermo Fisher Scientific s results computed in accordance with GAAP.The non-GAAP financial measures of Thermo Fisher Scientific s results of operations and cash flows included in this press release are not meant to be considered superior to or a substitute for Thermo Fisher Scientific s results of operations prepared in accordance with GAAP. Reconciliations of such non-GAAP financial measures to the most directly comparable GAAP financial measures are set forth in the tables above.