Udit Batra
President and Chief Executive Officer at Waters
Thank you, Casper, and good morning, everyone. We delivered an excellent finish to 2024 in the 4th-quarter, achieving high single-digit constant-currency revenue growth and low-teens adjusted EPS growth. In pharma, which is our largest end-market, sales grew low-double-digits.
Before diving into the details, I want to thank my colleagues at Waters for their resilience, innovative spirit and collaboration. This fuels our strong sales performance and operational achievements as we accelerate the benefits of pioneering science.
Throughout the year, our message has remained clear and consistent. We're executing well in an analytical instruments and systems market that is beginning its recovery. The innovation in our revitalized portfolio is well-aligned with customer unmet needs at a time when instruments are ripe for replacement. Our focus and leadership position in downstream, high-volume life science applications has earned us a unique exposure to an exciting mix of fast-growing, high-volume testing opportunities. This includes GLP-1 testing, PFAS testing and the genetics market in India.
Today, I'm pleased to share the latest proof points that demonstrate our favorable position right at a time when a recovery in customer capex spending and instrument replacement is beginning to kick into gear. I expect this strength and momentum to continue into 2025, and we will cover this later in the call.
Turning now to our results. In the 4th-quarter, sales grew 6.4% as-reported and 8% in constant-currency. Sales exceeded the high-end of our guidance range as growth accelerated across all our three reported regions. Instruments grew 8%, outpacing our expectations as LC, mass pack, light scattering and TA system sales each grew high-single-digits or better. Recurring revenues grew 9%, also marking an improvement from the previous quarter with chemistry and Service both up high-single-digits. We continue to build momentum delivering a high-teens quarter-over-quarter revenue ramp while funnel activity remains strong.
We also achieved outstanding results within our P&L. With our sustained focus on operational excellence, our non-GAAP earnings per share was $4.10, reflecting 13% EPS growth. Excluding the impact of FX, our adjusted EPS grew 22%. On a GAAP basis, EPS was $3.88.
Turning now to the full-year, sales were flat as-reported and in organic constant-currency as our quarterly growth performance improved every quarter. Recurring revenue grew 6%, once again underscoring the unique resilience of our recurring portfolio across various market conditions. With a strong EPS result in Q4, our full-year non-GAAP earnings per fully-diluted share was $11.86. This reflects 1% growth and includes a 5% decline due to foreign-exchange headwinds. On a GAAP basis, EPS was $10.71 per share.
Breaking out our results in more detail, we saw strong broad-based growth in the 4th-quarter. Strength was led by our pharma and academic end-markets, both of which grew double-digits. In pharma, sales grew 10%, led by low double-digit growth in Europe and Asia and high-single-digit growth in the Americas. In particular, spending amongst large pharma, contract manufacturing organizations and generics customers continued to recover where our revenue is tied to-high volume regulated QA/QC applications. In our segments, sales grew 6%, led by low double-digit growth in Europe, mid-single-digit growth in Asia and low-single-digit growth in the Americas. We saw strong growth in the A&G segment across Asia, including China, Japan and India as well as in Europe. By geography, Europe grew 11%, Asia 9%, America 6%. In China, overall sales returned -- returned to positive growth in China and was up low-single digits. Although all together, these results reflect excellent momentum into the year end.
I would now like to share more in-depth -- more in-depth commentary on what drove our strong performance. With our commercial focus and disciplined execution, we continue to deliver impressive outcomes driving like-for-like pricing gains. We also capitalized on the success of our new product launches, achieved strong placement of our new flagship products that command a price premium due to their unmatched benefits in solving customer unmet needs.
Within LC, Alliance IS has paved the way for smarter, more capable liquid chromatography separation that minimizes user errors. In the 4th-quarter, sales more than doubled quarter-over-quarter. Alliance IS constituted 20% -- 20% of our HPLC revenue in the 4th-quarter after adoption continued to scale throughout the year. Within mass spec, the TQ Absolute system remained our best-selling mass spectrometer with its market-leading sensitivity and sustainable design. In the 4th-quarter, unit sales grew 40% year-over-year and constituted 50% of our Tandem quad revenue. As a reminder, tandem are the most suitable mass specs for high-volume quantitative measurements in compliant settings. The Zevo TQ Absolute has been a key driver of the strong results we've achieved in PFAS testing and in clinical applications.
Our PFAS revenue grew over 40% in the 4th-quarter and for the year. PFAS testing is a $400 million global market, growing at 20% annually. So this represents growth at approximately twice the market for the second consecutive year. For clinical, total clinical revenue grew low-teens in the quarter, driven in-part by strong sales of the IVD version of the TQ Absolute. Within our chemistry consumables business, our newer column launches aimed at separating larger, more complex molecules like biologics and novel modalities continue to perform ahead of expectations. Max Premier columns sales grew over 30% in the quarter and over 40% for the year. With success of our new column launches, our exposure to higher-growth large molecule applications has risen. Large molecule applications are now approximately 40% of our pharma chemistry revenue and growing.
Our service -- our service team has continued to make strides in increasing plan attachment. For the first time, over 50% of our active installed-base has a service plan in-place. SDI recently recognized our service team for delivering the highest service satisfaction scores among all instrument vendors. At the same time, our Net Promoter scores lead the industry according to technology and Services Industry associations.
During the quarter, our unique exposure to new high-volume testing drivers also contributed to our growth. This includes novel therapeutic areas such as GLP-1 testing, PFAS testing applications in food and environmental testing and the expanding generic drug market -- generic truck market in India. All three represent a compelling growth opportunity for Waters based on our leadership position in downstream high-volume life science applications. In 2024, we performed very well against our growth expectations in each of these areas. In the near to mid-term, we continue to expect 30 basis-points annual average growth accretion from both GLP-1 testing and PFAS testing while India is expected to add 70 to 100 basis-points to the growth.
Now, I will talk more about our operational performance. Our team faced numerous margin challenges throughout the year, including FX, inflation and the normalization of annual incentive compensation. Despite a rapid strengthening of the US dollar during the 4th-quarter, our unwavering focus on operational excellence allowed us to counteract the currency headwinds. We achieved a 60 basis-point increase in adjusted operating margin to 35.5% after absorbing 220 basis-points of FX impact. Offsetting currency and macroeconomic headwinds is something our team has gotten very good at. For the full-year, we achieved year-over-year adjusted operation -- operating margin expansion, closing the year at 31%. This is after absorbing 130 basis-points of FX-related impact.
As we look-ahead, while no two macroeconomic environments are the same, instrument down-cycles have historically been followed by an upcycle as the new instrument replacement cycle emerges. During these uptrends, instrument growth has typically been 2% to 3% higher than the long-term average of 5%. Currently, our instrument growth sits at 2% on a five-year CAGR basis versus 2019. This comes after weak macroeconomic conditions put temporary constraints on customer capex spending for downstream instrumentation in recent years. The growth catch-up opportunity from this deferred instrument replacement is beginning to kick into gear.
Meanwhile, in the longer-term, we expect the average growth rate of instruments to actually trend higher than the historical 5%, driven by higher-volume trends, new application areas like large molecules and better pricing dynamics. Together with the progress we've made in our high-growth adjacencies, Waters is well-positioned for an exciting new era of growth as the analytical instrument market continues to recover. This also coincides with the launch of a new wave of commercial and value-creation initiatives that we look-forward to discussing in detail at our upcoming Investor Day.
I will now cover the 2025 full-year guidance. Customer spending has shown steady signs of recovery in analytical instruments, particularly in the downstream high-volume settings that we serve. We expect these positive trends to continue into 2025. Our team continues to execute well with our revitalized portfolio at a time when instrument replacement is beginning to pick-up. Together, our resilient recurring revenue growth and the ongoing impact of our idiosyncratic growth drivers, we anticipate continuing our strong momentum into 2025. These dynamics support full-year 2025 constant-currency sales growth guidance of 4.5% to 7%.
Within the P&L, the recent strengthening of the US dollar introduced additional foreign-exchange headwinds. Nevertheless, we plan to counterbalance these impacts with robust operational performance, sustaining our margin expansion -- margin expansion trends into 2025. This translates to a full-year 2025 earnings per fully related diluted share guidance of $12.70 to $13. On a non-GAAP basis, this is a 7% to 10 -- this is a 7% to 10% growth versus our 2024 versus 2024 and includes an estimated headwind of approximately 4% due to unfavorable foreign-exchange.
Now, I will pass the call over to Amol to cover our financial results in more detail and provide further details on our guidance. Amol?
