Abbott Laboratories’ third quarter results met Wall Street’s expectations for both revenue and non-GAAP profit, but the market reacted negatively, with shares declining over 4%. Management pointed to double-digit growth in medical devices, led by diabetes care and electrophysiology, as key drivers for the quarter. CEO Robert Ford commented that “recently launched new products generated nearly $5 billion in sales this quarter,” highlighting the contribution of new offerings. However, ongoing headwinds in the diagnostics segment—especially in China—continued to weigh on results, and the company acknowledged competitive challenges in U.S. pediatric nutrition.
Is now the time to buy ABT? Find out in our full research report (it’s free for active Edge members).
Abbott Laboratories (ABT) Q3 CY2025 Highlights:
- Revenue: $11.37 billion vs analyst estimates of $11.4 billion (6.9% year-on-year growth, in line)
- Adjusted EPS: $1.30 vs analyst estimates of $1.30 (in line)
- Adjusted EBITDA: $2.93 billion vs analyst estimates of $3.04 billion (25.8% margin, 3.4% miss)
- Management reiterated its full-year Adjusted EPS guidance of $5.15 at the midpoint
- Operating Margin: 18.1%, in line with the same quarter last year
- Organic Revenue rose 5.5% year on year vs analyst estimates of 5.3% growth (23.9 basis point beat)
- Market Capitalization: $222 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Abbott Laboratories’s Q3 Earnings Call
- Larry Biegelsen (Wells Fargo) asked if management remains comfortable with consensus growth targets for next year. CEO Robert Ford affirmed, highlighting momentum in key segments and the launch cadence for new products.
- Robbie Marcus (JPMorgan) sought more detail on U.S. diabetes growth and the impact of new sensors. Ford explained that earlier-than-expected restocking influenced quarterly trends but emphasized sustained demand and new product opportunities.
- David Roman (Goldman Sachs) questioned the impact of China headwinds on diagnostics and gross margin outlook. Ford pointed to stabilization in China and strength outside the region, while CFO Philip Boudreau described ongoing gross margin initiatives.
- Vijay Kumar (Evercore ISI) asked about normalized growth in China and the outlook for the cardiac rhythm management business. Ford projected mid-single-digit growth in China (excluding diagnostics) and noted ample runway for dual chamber leadless pacemaker adoption.
- Danielle Antalffy (UBS) inquired about competitive dynamics in left atrial appendage closure and barriers to broader diabetes device adoption. Ford acknowledged share losses in certain cardiac segments and cited physician engagement and awareness as key for expanding basal insulin device use.
Catalysts in Upcoming Quarters
In upcoming quarters, our analyst team will monitor (1) the adoption pace and feedback from new product launches like the Volt catheter and dual analyte sensors, (2) progress on mitigating diagnostic headwinds in China and sustaining share gains in diagnostics outside China, and (3) the recovery of U.S. pediatric nutrition market share following recent contract wins and product launches. Ongoing margin improvement efforts and regulatory milestones in biosimilars and structural heart devices will also be critical indicators.
Abbott Laboratories currently trades at $127.56, down from $133.26 just before the earnings. Is there an opportunity in the stock?Find out in our full research report (it’s free for active Edge members).
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