TLDR
- Abbott Laboratories reported Q4 sales of $11.5 billion, missing analyst estimates of $11.8 billion, while adjusted EPS of $1.50 met expectations
- Nutrition segment sales dropped 8.9% and diagnostics fell 2.5%, with medical devices rising 12% and established pharmaceuticals up 9%
- The company forecasts 2026 adjusted earnings of $5.55 to $5.80 per share with organic sales growth between 6.5% and 7.5%
- Abbott’s $21 billion acquisition of Exact Sciences remains on track to close in Q2 2026
- Shares plunged 8% following the earnings report, continuing a pattern of market disappointment despite meeting earnings estimates
Abbott Laboratories reported mixed fourth-quarter results Thursday, with shares tumbling 8% as revenue missed Wall Street estimates. The healthcare company posted adjusted earnings of $1.50 per share, meeting analyst expectations tracked by FactSet.
However, total sales came in at $11.5 billion, falling short of the $11.8 billion consensus forecast. Sales grew 3% from the prior year on an organic basis.
The earnings miss comes as Abbott continues to struggle with weakness in its nutrition division. Nutrition sales plummeted 8.9% in the quarter, marking several consecutive quarters of decline.
CEO Robert Ford acknowledged the persistent challenges during the earnings call. He said nutrition manufacturing costs have climbed steadily over recent years, partly due to post-pandemic commodity cost increases that remain in the company’s cost structure today.
Abbott has attempted to raise prices to offset these higher costs. But Ford admitted those price hikes have constrained volume growth in the current economic environment. Many consumer goods companies face this same dynamic, he noted.
Mixed Performance Across Business Segments
The company’s other divisions showed varying results. Medical devices sales jumped 12%, while established pharmaceuticals rose 9%.
Diagnostics sales declined 2.5% during the quarter. Abbott attributed this drop to an expected year-over-year decrease in COVID testing sales.
The nutrition segment includes well-known brands like Similac infant formula and Ensure nutrition supplements. This division has been a consistent weak spot in recent quarters.
Back in July, Abbott shares fell 8.5% despite second-quarter earnings meeting estimates. Investors reacted negatively to softer-than-expected guidance, creating a pattern of market disappointment.
Company Issues 2026 Guidance
Looking ahead, Abbott provided full-year 2026 guidance. The company expects adjusted earnings between $5.55 and $5.80 per share. Analysts had been looking for $5.68 per share at the midpoint of that range.
Abbott is targeting organic sales growth of 6.5% to 7.5% for the full year. Ford stated the company is “well-positioned for accelerating growth in 2026” in a statement.
The healthcare giant is moving forward with its largest acquisition since 2017. Abbott agreed last year to purchase Exact Sciences for roughly $21 billion.
The deal would give Abbott control of Cologuard, an at-home colorectal cancer screening test. Abbott confirmed Thursday the transaction remains on track to close during the second quarter of 2026.
Shares opened at $120.82 on Thursday and continued to decline throughout the trading session. The benchmark S&P 500 index gained 0.6% on the same day. Healthcare competitor Johnson & Johnson, which reported earnings Wednesday, traded 0.9% higher.
Abbott also announced a dividend increase. The company will pay a quarterly dividend of $0.63 per share on February 13th to shareholders of record as of January 15th. This represents an annualized dividend of $2.52 and a yield of 2.1%, up from the previous quarterly dividend of $0.59.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
