Abbott Tightens Annual Sales Forecast As Q3 Sales Miss Expectations

Abbott Laboratories (NYSE:ABT) stock fell after the company reported muted sales in the third quarter and narrowed fiscal 2025 guidance.

The company reported third-quarter sales of $11.37 billion, slightly missing the consensus of $11.40 billion.

Sales increased 6.9% on a reported basis, 5.5% on an organic basis, or 7.5% when excluding COVID-19 testing-related sales.

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The U.S. MedTech giant reported adjusted earnings of $1.30, in line with Wall Street estimates and within the management guidance of $1.28-$1.32.

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Segments

Medical Devices sales increased 14.8% on a reported basis and 12.5% on an organic basis to $5.45 billion.

Sales growth in the quarter was led by double-digit growth in diabetes care, electrophysiology, rhythm management, heart failure, and structural heart.

In diabetes care, sales of continuous glucose monitors were $2.0 billion and grew 20.5% on a reported basis and 17.2% on an organic basis. 

Worldwide Nutrition sales increased 4.2% (+4% on an organic basis) to $2.15 billion.

Growth in the quarter was led by Adult Nutrition, where sales increased 5.8% on a reported basis and 5.4% on an organic basis, led by strong growth of Ensure and Glucerna.

Global Diagnostics sales decreased 6.6% (-7.8% on an organic basis) and increased 0.4% when excluding COVID-19 testing-related sales to $2.25 billion.

COVID-19 testing-related sales were $69 million in the quarter, compared to $265 million a year ago.

Global Core Laboratory Diagnostics sales increased 3.8% on a reported basis and increased 2.2% on an organic basis. Growth in the quarter was impacted by challenging market conditions in China, including the impact of volume-based procurement programs. 

Established Pharmaceuticals sales increased 7.5% (+7.1% on an organic basis) to $1.51 billion. Sales in key emerging markets increased 10.3% on a reported basis and 11.1% on an organic basis, led by double-digit growth in several countries across Asia, Latin America, and the Middle East.

Abbott reported a third-quarter operating margin of 18.1 percent of sales and an adjusted operating margin of 23 percent, which reflects a 40 basis point year-over-year increase.

Guidance

Abbott Laboratories narrowed its fiscal 2025 adjusted earnings guidance from $5.10 to $5.20 per share to $5.12 to $5.18 per share, compared to the consensus of $5.15 per share.

In the second quarter, Abbott narrowed its full-year 2025 adjusted earnings guidance from $5.05 to $5.25 per share to $5.10 to $5.20 per share.

The company reaffirms its organic sales growth forecast of 7.5%-8.0%, or 6.0% to 7.0% when including sales related to COVID-19 testing.

Price Action: ABT stock is trading lower by 3.20% at $129 during the premarket session at the last check on Wednesday.

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