AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 5/6 · 18/10/2026
Moat50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 2/4 · Equipment leases linked to reagent shipments and integrated workflows support a current, bounded switching-cost advantage. They do not establish exclusive consumables, high replacement costs or equivalent protection across the company.
durability · 2/4 · The equipment-reagent model appears in both 2023 and 2025 disclosures. Its persistence supports some durability, but contractual duration and renewal economics are absent, and competitiveness requires continuing research investment.
customer dependency · 2/4 · Reagent shipments over equipment lease lives and complete workflows imply recurring customer reliance. This is indirect evidence of dependency; neither technical lock-in nor customer retention rates are demonstrated.
erosion resilience · 2/4 · Repeated positive pricing contributions and 2026 operating improvement support resilience. The realized 2025 margin decline limits that conclusion. Intense competition and funding exposure are prospective erosion channels, not proof of realized share loss.
Pricing power—
Insufficient evidence for every rubric criterion; no category score is inferred.
realized pricing · 3/4 · Reported targeted price increases benefited gross margin in 2024, 2025 and 2026, providing repeated operating evidence of realized pricing. The contribution is unquantified and does not establish exceptional pricing power or uniform strength across products.
retention · 2/4 · Equipment leases with reagent shipments throughout their lives support repeat demand and inferred switching friction. This assessment uses indirect contractual evidence; customer renewals and retention rates are not disclosed.
margin resilience · 2/4 · Targeted pricing partly offset 2025 cost pressures but did not prevent a two-percentage-point gross margin decline. Margins improved in 2026 with pricing among several contributors, including tariff refunds. Resilience is therefore mixed.
contractual freedom · — · The passages describe cancellation provisions and equipment leases but do not establish repricing rights, price-setting restrictions or the ability to change existing customer terms.
Predictability87
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 50.00
- Revenue growth volatility (pp)
- 5.29
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 2.68
Financial strength87
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 72.69
- netDebtEbitGrade
- 78.84
- interestCoverageGrade
- 100.00
- currentRatioGrade
- 96.59
- Debt / FCF (x)
- 2.91
- Net debt / operating income (x)
- 1.06
- Interest coverage (x)
- 13.21
- Current ratio (x)
- 1.96
Capital allocation99
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 23.66
- 3-year average dilution (%)
- -1.70
- 3-year average SBC / revenue (%)
- 1.82
- cashConversionGrade
- 100.00
Management50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Nine-month 2026 operating cash flow of $1,064 million supported $249 million of capital spending, $295 million of repurchases and $216 million of dividends. Acquisition spending of $950 million coincided with $600 million of debt issuance. Actual cash generation supports discipline, while acquisition returns remain unproven and the earlier Resolution Bioscience impairment is adverse allocation evidence.
incentive alignment · 2/4 · Actual incentive outcomes include a below-target fiscal 2025 company payout matrix, certified relative-TSR awards and forfeited grants following resignation. These support meaningful performance and service conditions. Fiscal 2026 removal of post-vest holding periods and discontinuation of new EPS awards make the overall alignment record mixed; actual ownership levels are unavailable.
execution · 2/4 · Reported 2026 operating income and operating cash flow improved, supporting execution through indirect operating evidence. Fiscal 2025 adjusted operating margin missed its incentive target, and 2026 margin improvement included tariff refunds and other external or accounting contributors. The record supports mixed execution rather than exceptional management performance.
governance · 2/4 · Disclosed board independence, an independent chair, independent committees and an adopted clawback policy support functioning oversight. The February 2026 proxy still described a classified board. A later amended-certificate exhibit indicates subsequent action, but its terms and the declassification vote outcome are not supplied; completed annual elections cannot be assumed.
Evidence
Finally, our biomolecular analysis business provides complete workflow solutions, including instruments, consumables and software, for quality control analysis of nucleic acid samples.
Business: biomolecular analysis workflow offering · Filed 22/12/2025
As a lessor, we have contracts for equipment leased to customers primarily in connection with our diagnostics and advanced manufacturing partnerships business which include both operating-type lease and sales-type finance lease arrangements.
Financial statement notes: equipment leased to customers · Filed 22/12/2025
Diagnostics equipment lease revenue for operating lease agreements is recognized as visualization kits and reagents are shipped over the life of the lease.
Financial statement notes: diagnostics lease revenue and reagent shipments · Filed 22/12/2025
Equipment lease revenue for operating lease agreements is recognized as visualization kits and reagents are shipped over the life of the lease.
Financial statement notes: equipment lease revenue and reagent shipments · Filed 20/12/2023
Our arrangements generally do not include any provisions for cancellation, termination, or refunds that would significantly impact recognized revenue.
Revenue recognition: cancellation, termination and refund provisions · Filed 22/12/2025
Life Sciences and Diagnostics Markets - Competition The analytical product sets in the Life Sciences and Diagnostics Markets in which we compete are characterized by evolving industry standards and intense competition.
Business: Life Sciences and Diagnostics Markets competition · Filed 22/12/2025
Our principal competitors in the Life Sciences and Diagnostics Markets arena include: AB Sciex., a division of Danaher Corporation, Avecia, a division of Nitto Denko, Bruker, Inc., Leica Biosystems, Inc., a division of Danaher Corporation, Roche Ventana Medical Systems, Inc., a member of the Roche Group, Shimadzu Corporation, Thermo Fisher Scientific Inc., Twist Bioscience Corporation and Waters Corporation.
Business: named Life Sciences and Diagnostics Markets competitors · Filed 22/12/2025
In addition, total gross margin was favorably impacted by targeted price increases, lower shipping costs and intangible amortization expense partially offset by lower sales volume, higher share-based compensation expense, higher wages and restructuring charges.
MD&A: fiscal 2024 gross margin drivers, including targeted pricing · Filed 22/12/2025
Total gross margin was unfavorably impacted by higher tariffs and shipping costs, unfavorable business mix (including lower gross margin from our specialty CDMO business), higher wages, restructuring expenses and variable pay partially offset by higher 46 Table of Contents sales volume, targeted pricing increases, lower warranty costs and amortization of intangible assets when compared to 2024.
MD&A: fiscal 2025 gross margin drivers, including targeted pricing · Filed 22/12/2025
3 ppts. Total gross margin for the year ended October 31, 2025 decreased 2 percentage points when compared to 2024.
MD&A: fiscal 2025 gross margin decline · Filed 22/12/2025
Gross margin for the three and nine months ended July 31, 2026 was overall favorably impacted by higher sales volume, a net benefit from tariff refunds, targeted price increases, favorable business mix, lower intangible amortization expense and lower restructuring expense partially offset by wage increases and higher variable pay when compared to the same periods last year.
MD&A: fiscal 2026 gross margin drivers, including pricing and tariff refunds · Filed 01/09/2026
Demand for some of our products and services depends on the capital spending policies of our customers, research and development budgets and on government funding policies.
Risk factors: customer capital spending and funding exposure · Filed 01/09/2026
We anticipate that we will continue to have significant research and development expenditures in order to maintain our competitive position with a continuing flow of innovative, high-quality products and services.
Business: continuing research expenditure needed to maintain competitiveness · Filed 22/12/2025
Operating Results Three Months Ended Nine Months Ended Year over Year Change July 31, July 31, Three Nine 2026 2025 2026 2025 Months Months (in millions, except margin data) Total gross margin 55.5 % 51.1 % 54.0 % 52.2 % 4 ppts 2 ppts Research and development $ 123 $ 111 $ 366 $ 336 10% 9% Selling, general and administrative $ 475 $ 417 $ 1,416 $ 1,281 14% 11% Operating margin 23.6 % 20.7 % 21.7 % 20.4 % 3 ppts 1 ppt Income from operations $ 444 $ 360 $ 1,196 $ 1,036 23% 15% 42 Table of Contents Total gross margin for the three and nine months ended July 31, 2026 increased 4 percentage points and 2 percentage points, respectively, when compared to the same periods last year.
MD&A: fiscal 2026 consolidated operating results · Filed 01/09/2026
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) (Unaudited) Nine Months Ended July 31, 2026 2025 Cash flows from operating activities: Net income $ 1,006 $ 869 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 200 217 Share-based compensation 105 102 Deferred taxes expense (benefit) 77 (35) Excess and obsolete inventory related charges 35 30 Net (gain) loss on equity securities 2 28 Asset impairment charges — 15 Other non-cash (income) expense, net 12 4 Changes in assets and liabilities: Accounts receivable, net 16 (44) Inventory (110) (72) Accounts payable 41 (13) Employee compensation and benefits (25) (26) Other assets and liabilities (295) (61) Net cash provided by operating activities 1,064 1,014 Cash flows from investing activities: Payments to acquire property, plant and equipment (249) (314) Proceeds from sale of equity securities — 5 Proceeds from convertible note — 2 Payments in exchange for convertible note (3) (1) Payments to acquire businesses and intangible assets, net of cash acquired (950) 4 Net cash used in investing activities (1,202) (304) Cash flows from financing activities: Proceeds from issuance of common stock under employee stock plans 63 60 Payments of taxes related to net share settlement of equity awards (31) (28) Payments for repurchase of common stock (295) (340) Payment of excise taxes related to repurchases of common stock (3) (10) Payments of dividends (216) (212) Proceeds from issuance of long-term debt 600 4 Repayments of long-term debt (4) (2) Payments of debt issuance costs (5) — Net proceeds from (repayments of) short-term debt — 13 Payments of finance lease (4) — Net cash provided by (used in) financing activities 105 (515) Effect of exchange rate movements 2 10 Net increase (decrease) in cash, cash equivalents and restricted cash (31) 205 Cash, cash equivalents and restricted cash at beginning of period 1,791 1,332 Cash, cash equivalents and restricted cash at end of period $ 1,760 $ 1,537 Supplemental cash flow information: Income tax paid, net of refunds received $ 376 $ 304 Interest payments, net of capitalized interest $ 47 $ 55 Net change in property, plant and equipment included in accounts payable and accrued liabilities-increase (decrease) $ (9) $ — Excise tax on share repurchases, accrued but not paid $ 2 $ 2 The accompanying notes are an integral part of these condensed consolidated financial statements.
Statements of cash flows: nine months ended July 31, 2026 and 2025 · Filed 01/09/2026
Total gross margin as well as gross margin on products for 2024 improved from the prior year as 2023 had asset impairment charges of $253 million primarily related to the exit of our Resolution Bioscience business.
MD&A: 2023 impairment charges associated primarily with Resolution Bioscience exit · Filed 22/12/2025
The target metrics set for our short-term incentives and their corresponding results were as follows: 31 COMPENSATION DISCUSSION AND ANALYSIS Operating Margin % Revenue $ Threshold Target Max Results Goal Attainment Target (Mil) Max (Mil) Results (Mil) Goal Attainment Payout Percentage (Per Matrix) Agilent 23.5% 27.0% 28.9% 25.7% 95.0% $6,960 $7,308 $6,934 100% 85.8% LDG 17.8% 20.5% 21.9% 19.8% 96.5% $2,738 $2,875 $2,719 99% 90.0% ACG 29.4% 33.8% 36.2% 32.6% 96.5% $2,889 $3,033 $2,902 100% 76.5% AMG 20.9% 24.0% 25.7% 22.9% 95.5% $1,333 $1,399 $1,312 98% 84.7% Note: The adjusted non-GAAP operating margin and adjusted non-GAAP revenue measures used in our executive compensation programs may differ from GAAP and non-GAAP operating margin and GAAP and non-GAAP revenue as reported in our quarterly earnings releases as they exclude the impact of mergers and acquisitions, currency and hedging.
Compensation discussion: fiscal 2025 incentive targets, results and payout matrix · Filed 06/02/2026
35 COMPENSATION DISCUSSION AND ANALYSIS Performance Stock Units Earned in Fiscal Year 2025 – Relative TSR Fifty percent of the FY23-FY25 performance stock units were measured based on relative TSR versus all companies in the S&P 500 Health Care and Materials Indexes for fiscal years 2023 through 2025 with the payout percentages as follows: Peer Group TSR Payout Percentage 75th Percentile 44.9% 200% Median 4.2% 100% 25th Percentile -28.0% 25% Agilent 10.6% 118% In November 2025, the Compensation Committee certified the relative TSR results for the fiscal year 2023 to fiscal year 2025 performance period.
Compensation discussion: certified fiscal 2023–2025 relative TSR performance · Filed 06/02/2026
Effective in fiscal year 2026, we have discontinued granting LTPP-EPS awards.
Stock compensation notes: discontinuation of new LTPP-EPS awards in fiscal 2026 · Filed 01/09/2026
In addition, LTPP-TSR awards granted in fiscal year 2026 are no longer subject to a one-year post-vest holding period.
Stock compensation notes: removal of post-vest holding period for fiscal 2026 TSR awards · Filed 01/09/2026
Effective in fiscal year 2026, all restricted stock units granted to our executives are no longer subject to a one-year post-vest holding period.
Stock compensation notes: removal of post-vest holding period for fiscal 2026 executive RSUs · Filed 01/09/2026
✓ Ten of our eleven directors are independent ✓ Annual Board self-assessment process, including peer evaluations ✓ Independent standing Board committees ✓ Majority voting and director resignation policy in uncontested director elections ✓ Longstanding independent Chairperson ✓ Continued assessment of highly qualified and independent candidates for nomination to the Board ✓ Regular meetings of our independent directors without management present ✓ Strong focus on pay-for-performance ✓ Board with an effective and robust mix of skills, experience and perspectives ✓ Proactive stockholder engagement ✓ Regular Board refreshment, as seen with four new independent directors added during the past five years ✓ Policies prohibiting hedging, short selling and pledging of our common stock ✓ Varied lengths of Board tenure with an average tenure of eight years - importantly maintaining deep understanding of the Company coupled with fresh perspectives ✓ Robust stock ownership guidelines for executive officers and directors ✓ Proxy access for our stockholders ✓ Comprehensive enterprise risk management approach, overseen by the Board through its Audit and Finance Committee ✓ And, if passed by our stockholders (see Proposal 4), annual elections for Board members beginning with Board members elected at our annual meeting in 2027 and applying to all Board members in starting 2029 Stockholder Engagement We have a year-round stockholder engagement program that reaches a wide variety of stockholders, market participants and potential investors.
Proxy: board independence, governance practices and conditional declassification · Filed 06/02/2026
The Board is currently divided into three classes each serving staggered three-year terms.
Proxy: existing classified board structure · Filed 06/02/2026
Effective October 2, 2023, the Committee adopted an additional Clawback Policy (the “Clawback Policy”) covering Section 16 Officers only.
Compensation risk controls: adopted clawback policy · Filed 06/02/2026
Fourth Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 on the Company's Current Report on Form 8-K filed on March 20, 2026)*
Exhibits: amended certificate incorporated from March 20, 2026 filing · Filed 01/06/2026
As a result of Mr. McMahon's resignation from Agilent effective July 31, 2025, all of his fiscal year 2025 stock grants were forfeited.
Compensation discussion: actual forfeiture of fiscal 2025 grants upon resignation · Filed 06/02/2026
