Danaher Corp. (NYSE:DHR)

The financial data over the periods analyzed reveal several noteworthy trends in sales, cost structure, profitability, and expense management.

Sales Trends

Sales experienced a general upward trajectory from approximately $4.3 billion in early 2020 to over $8.3 billion by the end of 2022, highlighting robust revenue growth. However, from early 2023 onwards, sales showed a noticeable decline, dropping to levels around $5.7 billion to $6.5 billion by mid-2025, indicating a contraction in sales after the peak period.

Cost of Sales and Gross Profit

The cost of sales mirrored the pattern in sales, increasing steadily through 2020 and 2021 and peaking in late 2022. Following the peak, cost of sales declined alongside revenues but maintained a high level relative to sales. Gross profit grew significantly through 2020 and 2021, reaching highs of nearly $5 billion, reflecting strong operational leverage. Nevertheless, gross profit also declined starting in 2023, stabilizing around $3.5 billion in subsequent quarters, marking a weakening in gross margin performance relative to peak periods.

Operating Expenses and Profitability

Selling, general and administrative expenses (SG&A) increased consistently through late 2021, peaking around $2.3 billion, before fluctuating between $1.8 billion and $2.3 billion thereafter. Research and development (R&D) expenses followed a similar pattern, peaking around $495 million in 2020 before stabilizing near $370-$440 million in following periods. Other operating expenses appear only in one quarter in 2020 with a significant cost, suggesting a non-recurring event.

Operating costs, combining various expense categories, rose markedly until late 2021, followed by a decrease and subsequent fluctuation around $2.2 billion to $2.7 billion. Operating profit showed substantial growth from early 2020 to its peak near $2.3 billion in late 2022, indicating improving core profitability. However, a clear decline in operating profit followed from 2023 onward, settling near $760 million to $1.3 billion, reflecting the overall sales decline and margin pressures.

Non-Operating Items and Interest

Other income and expenses demonstrated volatility, with a few periods of positive income amid frequent negative values, indicating some irregular non-operating items. Losses on early extinguishment of borrowings were recorded sporadically, notably in 2020 and 2022, affecting net results. Interest expense remained relatively stable, generally between $40 million and $87 million per quarter, while interest income showed an increasing trend, reaching over $100 million in early 2023 but tapering thereafter.

Income Taxes and Net Earnings

Income tax expenses fluctuated but generally aligned with earnings trends, with occasional quarters showing tax credits or adjustments. Net earnings from continuing operations increased significantly from early 2020 through 2022, peaking at over $2.2 billion, before declining substantially in 2023 and stabilizing thereafter between $550 million and $1.1 billion.

Net earnings, when including discontinued operations, showed similar trends, with discontinued operations contributing in certain quarters notably in 2021 and early 2023. After subtracting mandatory convertible preferred stock dividends, net earnings attributable to common stockholders also reflected the rise and fall pattern consistent with overall earnings.

In summary, the data illustrate a period of strong growth in sales and profitability through 2020 to late 2022, followed by a period of contraction and margin pressure through 2023 to 2025. Operating efficiency and cost control showed variability, possibly contributing to the fluctuating profitability. Non-operating factors and interest impacts were relatively minor though volatile. Net earnings trends closely tracked operational performance, confirming the impact of the sales slowdown on the company’s bottom line during the latter periods examined.