Bausch + Lomb NYSE: BLCO reported first-quarter 2026 results that management said show improving earnings quality and operating leverage alongside steady revenue growth, driven by strength in pharmaceuticals and continued momentum in vision care.
Management emphasizes “quality of growth” and operating leverage
Chairman and CEO Brent Saunders opened the call by addressing what he said is the key investor question: “when will our earnings consistently reflect the strength of this business?” Saunders described Bausch + Lomb as a “durable growth company” supported by long-term tailwinds such as aging populations, rising myopia rates, and a shift toward premium products and cataract surgery.
He said the company’s focus over the past several years has been on structural changes—simplifying the organization, driving cost discipline, and improving execution—that began translating into margin expansion in the second half of 2025. Saunders highlighted first-quarter results of 6% year-over-year constant-currency revenue growth and 59% adjusted EBITDA growth, with adjusted EBITDA margin of 16.1%.
Saunders also said the company is incorporating artificial intelligence into operations, including sales effectiveness, customer engagement, streamlining operations, reducing reliance on external vendors, and drug discovery. He added that the company is investing in employee upskilling to increase practical adoption of these tools.
Q1 revenue grows 6% to $1.244 billion; margin expands
CFO Sam Eldessouky said the quarter reflected “robust top line growth and margin expansion,” citing operating model simplification and productivity initiatives across manufacturing and supply chain. Total revenue was $1.244 billion, up 6% year over year, with foreign exchange providing a tailwind of about $42 million.
On profitability, Eldessouky reported:
- Adjusted gross margin: 61.2%, up 170 basis points year over year.
- Adjusted R&D: $101 million, up 15% year over year.
- Adjusted SG&A margin improvement: about 340 basis points.
- Adjusted EBITDA: $200 million, up 59% year over year (reported), with adjusted EBITDA margin of 16.1% (up 500 basis points).
- Adjusted EPS: $0.08, compared with a loss of $0.07 a year earlier (excluding acquired IPR&D).
Eldessouky also reported adjusted cash flow from operations of $45 million and capital expenditures of $100 million, including $7 million of capitalized interest. Net interest expense was $93 million for the quarter. He said the company remains focused on reaching a 3.5x net leverage target by the end of 2028, noting leverage improved in the quarter.
Segment performance led by Pharma; Surgical impacted by temporary factors
Vision Care revenue was $711 million, up 5% constant currency, driven by growth in both consumer and contact lenses. Eldessouky said consumer revenue increased 5%, with LUMIFY revenue of $55 million (up 15%). The consumer dry eye portfolio delivered $114 million (up 16%), led by Artelac (up 25%) and Blink (up 5%). Eye vitamins (PreserVision and Ocuvite) grew 2%.
In contact lenses, revenue increased 5%, led by daily silicone hydrogel (SiHy) and ULTRA. Daily SiHy was up 23% and ULTRA was up 3%. The U.S. contact lens business was up 6% and international up 4%.
Surgical revenue was $228 million, up 1% constant currency, following 11% growth in the prior-year quarter. Saunders said results were below expectations due to temporary factors including weather-related disruption to cataract procedures and reimbursement pressures in select markets, as well as the company’s rebuild of its U.S. surgical field force. Eldessouky said implantables were up 3%, premium IOLs grew 27%, consumables were up 2%, and equipment revenue declined 4% due to a greater mix of system placements.
Saunders pointed to a mix shift toward premium products, saying premium products represented 26% of U.S. surgical sales in the quarter, up from 19% a year earlier, while global premium mix increased to 13% from 10%. He said enVista U.S. sales grew 16% and Envy increased 88% year over year, and that U.S. system placements were nearly three times higher than the prior year.
Pharma revenue was $305 million, up 12% constant currency. Eldessouky said U.S. pharma was up 14% with “strong execution” across MIEBO and Xiidra. MIEBO delivered $76 million (up 33%), and Xiidra delivered $87 million (up 30%). International pharma grew 7%.
Commercial and pipeline updates: new launches and regulatory milestones
Saunders said the company filed an NDA for LUMIFY NXT (formerly LUMIFY Lux) and completed a CE mark submission for Silara during the quarter. He also said PreserVision AREDS 3 and Blink Triple Care Preservative-Free shipped in the first quarter.
Consumer President John Ferris described early indicators for PreserVision AREDS 3, saying it is now available nationwide and online and is intended to expand the addressable market for AREDS-formula vitamins by reaching early-stage AMD patients. Ferris said initial retailer orders in the first 60 days exceeded expectations and that Amazon sales velocity was tracking well, with a 4.7-star user rating. He also said the company had begun detailing and sampling more than 8,000 targets earlier in the month and noted that 12% of U.S. eye care professionals reported recommending PreserVision AREDS 3 early in the launch.
Ferris said LUMIFY grew 15% and gained 6% share in the quarter, adding that the brand holds “close to 70%” of the U.S. redness relief market. He said LUMIFY NXT is expected to launch in the first half of 2027.
In surgical, Saunders said enVista Envy launched in Europe in early April, calling it the company’s first diffractive premium IOL in that region, designed to complement LuxLife.
Guidance raised; Xiidra dynamics tied to CVS contract change
Eldessouky raised full-year 2026 guidance. The company increased revenue guidance by $45 million to a range of $5.42 billion to $5.52 billion, reflecting constant-currency growth of about 5.3% to 7.2%. Adjusted EBITDA guidance was raised by $10 million to a range of $1.01 billion to $1.06 billion, implying about 19% margin at the midpoint and roughly 16% year-over-year adjusted EBITDA growth.
Other guidance assumptions included currency tailwinds of about $50 million to revenue, adjusted gross margin around 62%, R&D investment of 7.5% to 8% of revenue, interest expense of about $365 million, an adjusted tax rate around 19%, and full-year CapEx of about $285 million, weighted to the first half.
During Q&A, Saunders attributed Xiidra’s revenue performance to the company’s decision to exit a CVS contract, saying Bausch + Lomb had previously communicated that total prescriptions would decline while revenue rose. He said the contract was inherited and lasted until this year, and while the company attempted to renegotiate, it “couldn’t get to an acceptable rate.” He said coverage for both Xiidra and MIEBO remains “industry-leading in the mid-70% coverage.” Saunders added he would not expect Xiidra’s 30% growth rate to persist all year, but said “low double-digit growth should be the new norm for the rest of the year.” Eldessouky said gross-to-net is expected to be in the low 70% range after moving from high 70% when the CVS contract ended.
Saunders also discussed seasonality in dry eye prescriptions, describing lower January and February volumes as “the new normal” tied to insurance dynamics, with improvement as the year progresses.
On contact lenses, Saunders said he expects the market to modestly improve and that the company aims to outperform it, citing the importance of offering a full set of modalities in each geography as the company expands its daily SiHy lineup internationally.
About Bausch + Lomb NYSE: BLCO
Bausch + Lomb Corporation operates as an eye health company in the United States, Puerto Rico, China, France, Japan, Germany, the United Kingdom, Canada, Russia, Spain, Italy, Mexico, Poland, South Korea, and internationally. It operates in three segments: Vision Care, Pharmaceuticals, and Surgical. The Vision Care segment provides contact lens that covers the spectrum of wearing modalities, including daily disposable and frequently replaced contact lenses; and contact lens care products comprising over-the-counter eye drops, eye vitamins, and mineral supplements that address various conditions, such as eye allergies, conjunctivitis, dry eye, and redness relief.
Further Reading
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
Before you consider Bausch + Lomb, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Bausch + Lomb wasn't on the list.
While Bausch + Lomb currently has a Hold rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
With the proliferation of data centers and electric vehicles, the electric grid will only get more strained. Download this report to learn how energy stocks can play a role in your portfolio as the global demand for energy continues to grow.
Get This Free Report
