Key Highlights
- Abbott shares climbed approximately 4% in premarket hours following second-quarter results that exceeded expectations
- The company reported adjusted earnings per share of $1.31, surpassing the consensus forecast of $1.28
- Second-quarter revenue increased 13% year-over-year to $12.59 billion, propelled by a remarkable 42% surge in diagnostics
- Management increased its full-year adjusted EPS outlook to a range of $5.45–$5.60 from the previous $5.38–$5.58
- The diagnostics division exceeded projections for the first time in a year and a half, with Exact Sciences assets providing substantial momentum
Abbott Laboratories delivered second-quarter performance that exceeded Wall Street projections and enhanced its annual earnings forecast, propelling ABT shares nearly 4% higher during Thursday’s premarket session.
The healthcare giant posted adjusted earnings of $1.31 per share, comfortably beating the analyst consensus of $1.28. Quarterly revenue climbed 13% from the prior year to reach $12.59 billion, slightly exceeding the $12.52 billion Wall Street had anticipated.
The standout performer this quarter was undoubtedly the diagnostics business. This division generated $3.09 billion in sales—a remarkable 42% increase—outpacing projections of $3.02 billion. This represented the first time in six consecutive quarters that diagnostics delivered an upside surprise.
A significant portion of this impressive performance stemmed from the recently completed Exact Sciences asset acquisition, which brought key products including Cologuard, a colorectal cancer screening solution, and Oncotype DX, a breast cancer diagnostic test, into Abbott’s portfolio. Cologuard delivered growth in the mid-teens percentage range, supported by expansion among both first-time and repeat users.
These strong diagnostics numbers are helping the company compensate for the ongoing decline in COVID-19 testing revenue, which had served as a substantial revenue contributor in previous fiscal periods.
Medical Devices Segment Maintains Momentum
Abbott’s medical devices business generated $5.85 billion in sales, representing 9% growth and marginally exceeding the $5.82 billion consensus estimate. The company’s electrophysiology and structural heart portfolios continue demonstrating resilience compared to competitors facing headwinds from reduced surgical procedure volumes and increasing rates of uninsured patients.
The Diabetes Care division, featuring the FreeStyle Libre and Lingo continuous glucose monitoring systems, recorded revenue growth of 10.5% to reach $2.19 billion. J.P. Morgan analyst Robbie Marcus observed that the worldwide CGM market has stabilized into an 8%–12% growth trajectory, with Abbott positioned within the 8%–10% portion of that spectrum moving forward.
Nutrition represented the quarter’s underperformer—this segment experienced a 3.1% revenue decline attributable to reduced product volumes and recent pricing adjustments.
Enhanced Financial Projections
Abbott elevated its annual adjusted earnings per share projection to $5.45–$5.60, representing an increase from the previous guidance range of $5.38–$5.58. The organization maintained its comparable sales growth forecast of 6.5%–7.5% for the full year.
Looking to the third quarter, Abbott projected adjusted EPS between $1.38 and $1.46, compared with the Street estimate of $1.42—positioning the guidance midpoint essentially aligned with analyst expectations.
On a generally accepted accounting principles basis, net income declined to $928 million, equivalent to $0.53 per share, compared to $1.78 billion, or $1.01 per share, in the same quarter last year. This reduction reflects expenses associated with recent acquisitions and various non-recurring charges.
The established pharmaceuticals business contributed to the overall revenue outperformance with sales growth exceeding 8%.
The diagnostics outperformance—breaking a streak of five consecutive misses—came directly from the completed Exact Sciences acquisition, providing Abbott with a fresh growth catalyst as its traditional testing operations continue contracting.
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