Our diverse and innovative portfolio has been driving growth this quarter with companion animal products up 20% operationally and livestock product sales up 9% operationally.
Our newest parasiticides, including Simparica Trio, REVOLUTION PLUS and ProHeart 12 led the way again along with vaccines, key dermatology products and our diagnostics portfolio, including reference labs.
As a result of the sales growth and target investments, we delivered adjusted net income growth of 20% operationally for the third quarter.
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In the third quarter, we generated revenue of $1.8 billion, growing 13% on a reported basis and 15% operationally.
Adjusted net income of $524 million was an increase of 15% on a reported basis and 20% operationally.
Foreign exchange negatively impacted revenue in the quarter by 2%, driven primarily by the strengthening of the U.S. dollar.
Operational revenue growth was 15% with contributions of 2% from price and 13% from volume.
Volume growth of 13% includes 5% from other in-line products, 4% from new products, 3% from key dermatology products and 1% from acquisitions.
Companion animal products led the way in terms of species growth, growing 20% operationally with livestock growing 9% operationally in the quarter.
The positive momentum for Simparica Trio continued in the third quarter, and we expect full year incremental revenue of between $125 million to $150 million.
We're also extremely pleased with the performance of our broader parasiticide portfolio, which, in the U.S., gained an additional 6% market share in the fleet, tick and heartworm segment for the third quarter versus the same period in the prior year.
Global sales of our key dermatology portfolio were $251 million in the quarter, growing 16% operationally and contributing 3% to overall revenue growth.
New products contributed 4% growth in the quarter, driven by companion animal parasiticides, Simparica Trio, REVOLUTION PLUS and ProHeart 12.
Recent acquisitions contributed 1% of growth this quarter, including our expansion to reference labs and the Platinum Performance nutritionals business.
U.S. revenue grew 18% with companion animal products growing 21% and livestock sales increasing by 13%.
For companion animal, we continued to be encouraged by vet clinic trends with revenue per clinic up 12% in the quarter and demand for our products remaining robust.
Simparica Trio continued to perform well in the U.S. with sales of $44 million despite difficult market conditions for a new product launch.
Key dermatology sales were $180 million for the quarter, growing 17%, with significant growth for CYTOPOINT and APOQUEL, resulting from additional patient share and an expanding addressable market.
Diagnostic sales increased 28% in the quarter as a result of our reference lab acquisitions and increased point-of-care consumable usage.
U.S. livestock grew 13% in the quarter, driven primarily by cattle.
Revenue in our International segment grew 11% operationally in the quarter with growth across all species with the exception of poultry, which was flat in the quarter.
Companion animal revenue grew 20% operationally and livestock revenue grew 6% operationally.
Companion animal diagnostics grew 17% in the quarter led by an increase in point-of-care consumable usage.
Swine delivered another strong quarter with 16% operational revenue growth, primarily driven by China, which grew 159%.
Our fish portfolio delivered another strong quarter, growing 10% operationally, driven by an increase in market share in vaccines and the acquisition of Fish Vet Group.
Adjusted gross margin of 69.6% fell 50 basis points on a reported basis compared to the prior year as a result of negative FX, the manufacturing costs and recent acquisitions.
Adjusted operating expenses increased 9% operationally, resulting from increased advertising and promotion expense for Simparica Trio and APOQUEL.
The adjusted effective tax rate for the quarter was 20%, a decrease of 50 basis points, driven by the impact of net discrete tax benefits.
Adjusted net income for the quarter grew 20% operationally primarily driven by revenue growth, and adjusted diluted earnings per share grew 21% operationally.
For revenue, we are raising and narrowing our guidance range with projected revenue now between $6.55 billion and $6.625 billion and operational revenue growth of between 7% and 8% for the full year versus the 3% to 6% in our August guidance.
Adjusted net income is now expected to be in the range of $1.79 billion to $1.825 billion representing operational growth of 6% to 8% compared to our prior guidance of 1% to 5%.
Adjusted diluted earnings per share is now expected to be in the range of $3.76 to $3.81 and reported diluted earnings per share to be in the range of $3.38 to $3.45.

Summary:
In the third quarter, we generated revenue of $1.8 billion, growing 13% on a reported basis and 15% operationally.
For revenue, we are raising and narrowing our guidance range with projected revenue now between $6.55 billion and $6.625 billion and operational revenue growth of between 7% and 8% for the full year versus the 3% to 6% in our August guidance.
Adjusted diluted earnings per share is now expected to be in the range of $3.76 to $3.81 and reported diluted earnings per share to be in the range of $3.38 to $3.45.