Revvity Sees High-Content Screening Demand Inflect on New $1 Million Instrument, Builds Its Strongest Backlog in 3 to 5 Years While Guiding Conservatively
Investor Relations head outlines H2 setup at the 2026 Global Healthcare Conference, September 15, 2026
Revvity (RVTY) used its appearance at the 2026 Global Healthcare Conference to make the case that the company is entering the second half with better demand visibility than its guidance implies. Stephen Willoughby, Senior VP of Investor Relations, told the audience that the company exited the second quarter with "the strongest backlog we've seen in the last 3, 4, probably even 5 years" in Life Sciences instruments. Management declined to quantify backlog or book-to-bill, saying only that orders outpaced revenue and that the ratio is "definitely above 1." The shares closed at roughly $153 last week, giving the company a market capitalization of about $17.0 billion and a forward P/E of 27.1x.
High-Content Screening Is the Demand Inflection, and It Is Narrow
The backlog is concentrated in one category. Revvity leads the high-content screening market, selling high-end systems at around $1 million and mid-range systems at several hundred thousand dollars. The company launched a new high-end instrument in late February, and Willoughby described "an inflection in demand, not just a pickup" starting in mid- to late May. Because the instrument is brand new and takes several months to build, it generated little second-quarter revenue. Deliveries begin in the third quarter and continue into the fourth.
Guidance reflects this. Management assumes Life Sciences instruments growth accelerates from low single digits in the second quarter to mid-single digits in both the third and fourth quarters. Willoughby was explicit that this step-up is "really being driven by that High-Content Screening," and that the company is assuming no improvement in its other instrument categories. Investors should read this as a single-product-cycle story rather than a broad instrument recovery, although the concentration also means the guide has limited dependence on the wider market.
AI Is Changing How the Instruments Are Used
Willoughby tied the screening demand to AI, arguing that Revvity is "one of, if not the best positioned company to benefit from how AI is changing science." The logic is that AI generates more drug hypotheses, but those candidates must still be validated in the wet lab. High-content screening systems produce "terabytes of data per instrument per day" which previously could not be fully processed. With AI, that data can now be used, and the company believes this is changing the instruments' value proposition and contributing to the order inflection.
He said demand is improving from both traditional and nontraditional customers, including those building AI discovery platforms. He declined to size the nontraditional cohort, and noted the inflection is driven more by traditional customers. He characterized the nontraditional piece as "not insignificant and it's new." The lack of figures means this remains a qualitative claim.
Software: A 20% Decline That Management Attributes to Accounting, With a Heavy Product Cycle Ahead
Signals software revenue fell 20% organically in the second quarter against a 35% positive comparison. Willoughby, calling software revenue recognition his "favorite topic," attributed the drop to GAAP mechanics. Software is 9% to 10% of company revenue, and a little over one-third of it is SaaS recognized evenly. About two-thirds remains legacy on-premise licenses, where a large portion of revenue is recognized when a contract is signed or renewed. Annualized portfolio value, which smooths this, is growing about 12%, and he said it represents what organic growth would average without new wins. Management assumes software grows in the high teens in the third quarter and mid- to high teens in the fourth, and Willoughby said this is the business where Revvity has the most visibility because of contract renewal timing.
The product cadence is dense. Beyond BioDesign in April, Signals AI in June, and the Anthropic connector and Signals for Startups in July, Willoughby pointed to the Xynthetica AI model marketplace launched with Eli Lilly earlier this year, and a further AI-native product called LabGistics due before year-end. He called 2026 "easily the most important new product launch year in probably the history of our software business," and noted that several offerings "weren't even on the drawing board 12 or 18 months ago."
The financial contribution this year is described as "fairly nominal," with revenue expected to build in 2027 and 2028 after RFPs and contracting. A notable change is the revenue model. Historically software was seat- or license-based, but new products add a consumption element tied to compute and token usage, and potentially data storage. That could alter the shape and predictability of software revenue over time, although none of it is in the numbers yet.
Diagnostics Is Running Well Ahead of Plan
Diagnostics organic growth accelerated from 9% in the first quarter to 11% in the second, above plan, and the full-year outlook was raised to high single digits. Reproductive health is the standout. The long-range plan assumed 2% to 4% growth, the business historically grew 5% to 6%, and it is now growing in double digits. A U.K. Genomics England newborn sequencing contract added about 500 basis points in the second quarter, but excluding it the business still grew about 10%, "which is phenomenal, especially considering that births globally are declining 1% to 2%." Willoughby credited instrument placements, test demand, geographic expansion and new products.
The Genomics England contract began in mid-2025 and currently runs through mid-2026's anniversary, i.e. the middle of next year. Revvity is in active talks to extend it, and Willoughby noted positive BBC coverage of clinical outcomes in identified babies, which he said bodes well for continuation. The company is not assuming an extension, which leaves a visible revenue cliff risk in the second half of 2027 if talks fail.
Immunodiagnostics, mostly rare autoimmune testing, is guided to high single digits for the year despite roughly 200 basis points of headwind from latent TB pressure that should ease in 2027. Excluding China, Willoughby said, the business has grown high single digits to low double digits across every look-back period, supported by 6% to 7% plus market growth for esoteric autoimmune, new products and continued U.S. underpenetration. The pending divestiture of most of the China diagnostics business is already excluded from pro forma results, and he argued China had been masking the underlying performance.
Reagents and End Markets: Guidance Assumes No Market Help
Reagents grew at the low end of low single digits in the second quarter. Revvity built some backlog in consumables from larger bulk orders that slipped, which should shift into the third quarter and push growth to the upper end of the low-single-digit range. The fourth-quarter step-up to mid-single digits comes from easier comparisons, not market improvement. Willoughby emphasized that "we're not assuming any further market recovery."
On end markets, academic and government, about 12% of total revenue, is "stably soft," with no expected change in the back half. He said what is needed is policy stability so that researchers feel confident spending awarded funds, not just headline NIH numbers. Pharma and biotech has been recovering since mid- to late February, with the improvement continuing through June and July. More than 85% of pharma and biotech revenue comes from medium and large companies, and he linked the normalization to clarity following Pfizer's White House agreement 6 to 9 months ago.
China Life Sciences Outperforms; Competitive Position Intact
China Life Sciences is about 7% of total revenue, or about 8.5% of the company including the portion of diagnostics being divested. It remains the fastest-growing region, with reagents growing double digits in the second quarter. Willoughby said Revvity is outperforming peers there because Chinese pharma has shifted toward innovative medicines, and Revvity products are used for new science. "We don't sell liquid chromatography. We're not doing the same thing over and over and over again."
On competition, he saw no meaningful share change, noting peers also grew low single digits against easier comparisons. He cited innovation, next-day delivery on more than 95% of antibody orders, in-house manufacturing of nearly everything it sells, and value positioning with strong margins. He took an implicit swipe at peers that have "come into some controversies."
Tuck-In Deal and Capital Position
Last week Revvity agreed to acquire Human Cell Design, which has human-relevant cell lines, including a pancreatic line used in metabolomic research tied to diabetes and GLP-1 drugs. Willoughby called it a small tuck-in that complements the company's high-content and high-throughput screening franchise. No financial terms were discussed.
Willoughby closed by framing the balance sheet and cash flow as largely fixed. Revvity repurchased 15% of its shares across 2024 and 2025, paid off a large bond in July, and is running free cash flow conversion above 100% year to date. What is missing is organic growth. "We just need a little bit better organic growth to actually demonstrate that sales leverage," he said, adding that Revvity has "some of, if not the highest incremental margins in the entire life science tools industry." That claim remains unproven until growth moves beyond the low single digits in the core Life Sciences business.