Charles River Laboratories (CRL) official guidance

Through its recently introduced Create the Future™ program, Charles River expects to generate over $300 million in cumulative savings from 2027 through 2030 by simplifying processes and increasing automation and digital enablement.

Non-GAAP EPS estimate (4) Upper end of $11.15 – $11.45 Low-double-digit 2027-2030 CAGR

Non-GAAP operating margin (4) 21.0% – 21.3% ~24%

Revenue growth, organic (3) Upper end of 0% – 1% growth 5% – 7% 2027-2030 CAGR

Charles River expects its bioanalysis revenue to grow organically at a high-single-digit CAGR to approximately $450 million in 2030.

Based upon our second quarter results and updated forecast, which also encompasses higher performance-based compensation, we now expect unallocated corporate costs of approximately 6.0% of revenue for the full year, compared to our prior outlook of approximately 5.5%.

Our updated guidance assumes an average diluted share count of approximately 48.5 million shares for the full year 2026.

For the full year, we now anticipate our non-GAAP tax rate will be in the range of 23%-24%, an increase of approximately 100 basis points from our prior outlook, primarily as a result of the unfavorable second quarter rate and a higher tax rate due to proposed tax legislation changes in a foreign tax jurisdiction.

For the third quarter, we expect non-GAAP earnings per share in the range of $2.90-$3, representing an approximate 20% year-over-year increase.

For the full year, we're raising our free cash flow projections to be in the range of $400 million-$420 million, compared to our prior outlook of $375 million-$400 million, largely driven by higher earnings.

For the full year, our net interest expense outlook remains unchanged at $103 million-$108 million on a non-GAAP basis.

We continue to expect operating margin expansion of approximately 120-150 basis points in 2026, with the manufacturing and DSA segments driving the year-over-year increase.

In addition, operating margin is projected to improve approximately 200 basis points sequentially versus the second quarter, due largely to lower corporate costs and a full quarter benefit from the divestitures.

As a result of these collective trends, we have raised our DSA outlook to low single-digit organic revenue growth in 2026.

We're also adjusting our manufacturing revenue outlook higher to a low to mid single digit growth rate.

The manufacturing organic growth rate is expected to improve to mid to high single-digit rates in the second half of the year when the biologic testing growth rate rebounds after we anniversary a client-specific challenge that has been a headwind since the middle of last year.

For the year, we continue to expect a low to mid-single digit organic revenue decline in the RMS segment, with much of this decline driven by lower volumes for research models in North America.

We expect organic revenue growth of approximately 1%-3% year-over-year, reflecting improving demand trends in the DSA segment and an expected rebound in biologics testing growth rate, which will drive higher manufacturing revenue growth.

We now expect reported revenue to decline in the range of 2.5%-3.5%, driven by the impact of completed divestitures.

For the third quarter, revenue is expected to decline approximately 4%-6% on a reported basis, primarily driven by the impact of the completed divestitures.