Quick Summary
- Total Revenue: $4.02 billion (down 0.9% YoY).
- Organic Revenue Decline: 1.6%.
- Non-GAAP EPS: $10.28 (essentially flat vs. $10.32 in 2024).
- GAAP Net Loss: $144.3 million (vs. net income of $10.3M in 2024).
- Non-GAAP Operating Margin: 19.8% (slight decline from 19.9%)
Charles River Laboratories International, Inc. (NYSE: CRL) announced its fourth-quarter and full-year 2025 results on February 18, 2026, providing investors with a comprehensive view of the company’s financial performance and outlook for the coming year. The company reported full-year revenue of $4.02 billion, reflecting a slight decline of 0.9% from the prior year, while delivering non-GAAP earnings per share of $10.28.
Charles River Laboratories Earnings Performance: Fourth Quarter Delivers Mixed Results
In the fourth quarter of 2025, Charles River Laboratories earnings reflected the company’s ongoing navigation through a challenging biopharmaceutical market. The company reported fourth-quarter revenue of $994.2 million, down 0.8% from $1,002.5 million in the fourth quarter of 2024. On an organic basis, which excludes the impact of foreign currency translation and divestitures, revenue declined 2.6%, driven primarily by weakness in the Discovery and Safety Assessment (DSA) and Manufacturing Solutions segments.
The company’s Charles River Laboratories earnings results were significantly impacted by non-cash impairments totaling $376 million. Specifically, the company recorded intangible asset impairments of $211.0 million related to the Biologics Solutions reporting unit and Cell Solutions business, along with goodwill impairments of $165.0 million in the Biologics Solutions unit. These charges resulted in a GAAP net loss of $(276.6) million, or $(5.62) per diluted share, in the fourth quarter.
On a non-GAAP basis, however, Charles River Laboratories earnings performance was more positive. Non-GAAP net income totaled $118.8 million for the quarter, with non-GAAP diluted earnings per share reaching $2.39, down 10.2% from $2.66 in the prior year quarter. The decline was primarily attributed to lower revenue and operating margins, as well as a higher tax rate.
Full-Year 2025 Charles River Laboratories Earnings: Slight Decline Masks Strategic Progress
For the full year 2025, Charles River Laboratories earnings totaled $512.3 million on a non-GAAP basis, representing a 3.9% decrease from $532.9 million in 2024. Non-GAAP diluted earnings per share were $10.28, essentially flat compared to $10.32 in 2024, demonstrating remarkable stability despite revenue headwinds.
We were pleased with our 2025 financial results, including substantial improvement in DSA net bookings in the fourth quarter that demonstrates the stabilization of the biopharmaceutical demand environment,
We are making significant progress on several strategic initiatives that will enable the Company to better capitalize on future growth opportunities.
James C. Foster
Read More: IQVIA Posts Strong Q3 2025 Results, Lifts Free Cash Flow
The company’s full-year revenue decline of 0.9% was driven by organic revenue decreases of 1.6%, partially offset by the positive impact of foreign currency translation. The GAAP operating margin declined to 0.6% from 5.6% in 2024, primarily due to the significant impairment charges. However, the non-GAAP operating margin remained relatively stable at 19.8%, compared to 19.9% in the prior year.
Charles River Laboratories Earnings by Segment: Mixed Performance Across Business Units
The RMS segment, which generates revenue from research models and related services, posted full-year revenue of $846.1 million, up 2.0% from $829.4 million in 2024. This represents organic revenue growth of 1.2%, demonstrating resilience in what has been a challenging period for the company’s other segments. On a non-GAAP basis, the RMS segment’s operating margin expanded to 24.8% in 2025 from 23.7% in 2024.
However, in the fourth quarter, RMS revenue growth slowed to just 1.0% on a reported basis, with organic revenue actually declining 0.9%. The segment faced headwinds from lower revenue for large research models and small research models in North America, though these declines were partially offset by strength in research model services, particularly in the Insourcing Solutions business.
Discovery and Safety Assessment Segment Stabilizing After Demand Weakness
The DSA segment, which represents the largest portion of Charles River Laboratories earnings and accounts for approximately 60% of total revenue, generated full-year revenue of $2.40 billion, down 2.0% from $2.45 billion in 2024. Organic revenue declined 2.6%, reflecting weakness in discovery services and regulated safety assessment services throughout much of the year.
The critical development in the DSA segment came in the fourth quarter, where the company reported substantial improvement in net bookings. While revenue still declined 2.0% in the quarter, the improvement in booking trends suggests a meaningful inflection point. On a non-GAAP basis, the DSA segment’s operating margin decreased to 20.1% in the fourth quarter from 24.7% in the prior year, primarily driven by lower revenue and higher study-related direct costs associated with large-model sourcing and staffing.
For the full year, the DSA segment’s non-GAAP operating margin declined to 24.2% from 25.7% in 2024, reflecting the revenue pressure experienced throughout most of 2025.
Read More: Abbott Signals Accelerating Growth for 2026 Following Strong Q4 and 2025 Performance
2026 Guidance: Charles River Laboratories Earnings Outlook Reflects Cautious Optimism
Charles River Laboratories management provided guidance for 2026 that reflects cautious optimism regarding the recovery in the biopharmaceutical market. The company projects non-GAAP earnings per share growth of approximately 4% to 9% in 2026, suggesting non-GAAP EPS in the range of $10.70 to $11.20.
For reported revenue, the company expects growth of at least flat to +1.5% in 2026, though this guidance includes the impact of planned divestitures representing approximately 7% of 2025 revenue. On an organic basis, excluding the impact of divestitures, acquisitions, and foreign currency translation, the company expects organic revenue to decline 1.0% to be at least flat in 2026. Management expects a return to organic revenue growth in the second half of 2026 for both the consolidated company and the DSA segment.
The company also anticipates organic revenue growth in the Manufacturing segment, driven by the anniversary of a large CDMO customer loss in 2025 and continued strength in Microbial Solutions. However, the company expects lower revenue in the RMS segment due to anticipated declines in large model revenue and lower revenue from CRADL operations.
Non-GAAP earnings per share growth in 2026 is expected to be driven by incremental cost savings from restructuring and efficiency initiatives, as well as earnings accretion from the recently completed acquisition of K.F. (Cambodia) Ltd. Additionally, a lower tax rate is anticipated to contribute to earnings per share growth.
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Investment Implications: Charles River Laboratories Earnings Position the Company for Recovery
Charles River Laboratories’ 2025 Charles River Laboratories earnings results and 2026 guidance suggest that the company has successfully navigated a challenging period in the biopharmaceutical market. While revenue growth remains constrained, the stabilization of DSA bookings in the fourth quarter, combined with expectations for improved demand trends in 2026, provides a positive outlook for investors.
The company’s emphasis on cost management and operational efficiency, as evidenced by non-GAAP margin stability despite revenue headwinds, demonstrates disciplined execution. Looking ahead, Charles River Laboratories appears well-positioned to capitalize on anticipated improvements in biopharmaceutical spending, with management’s cautious optimism regarding 2026 reflecting confidence in the company’s strategic direction.
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