Abbott Labs Q3 2025 presentation: organic growth solid despite market challenges

Introduction & Market Context

Abbott Laboratories (NYSE:ABT) presented its third-quarter 2025 results on October 15, highlighting solid organic sales growth despite facing headwinds in certain markets. The healthcare giant reported adjusted earnings per share of $1.30, meeting analyst expectations, while posting worldwide sales of $11.37 billion, slightly below the forecasted $11.4 billion.

Despite the in-line earnings performance, Abbott’s stock fell 4.03% to $127.90 in trading following the announcement, reflecting investor concerns about the minor revenue miss and challenges in international markets, particularly China. The stock remains well within its 52-week range of $110.86 to $141.23, with a year-to-date return of 19.52% prior to this announcement.

Quarterly Performance Highlights

Abbott reported organic sales growth of 7.5% for its underlying base business, excluding COVID-19 testing-related sales. The company achieved an adjusted diluted EPS of $1.30, demonstrating high single-digit growth year-over-year. Abbott’s adjusted gross margin reached 55.8% of sales, while its adjusted operating margin improved to 23%, representing a 40-basis-point increase.

The company’s performance was driven by strength in its diversified portfolio, with medical devices leading the way at $5.4 billion in quarterly sales. The continuous glucose monitoring segment was particularly strong, though the earnings call revealed some penetration challenges in this area that management is addressing through strategic initiatives.

Business Unit Performance

Abbott’s business units showed varied performance in the third quarter. Medical Devices generated $5.4 billion in sales, representing nearly half of the company’s total revenue. Diagnostics contributed $2.3 billion, while Nutrition and Established Pharmaceuticals delivered $2.2 billion and $1.5 billion, respectively.

During the earnings call, management acknowledged challenges in the Chinese diagnostics market that impacted overall growth. Despite these headwinds, Abbott maintained its competitive position in key sectors, particularly in medical devices and diabetes care, which continue to drive the company’s organic growth.

CEO Robert Ford emphasized the strength of Abbott’s innovation pipeline during the earnings call, stating, "Our organic R&D engine continues to be highly, highly productive." This focus on research and development supports the company’s long-term growth strategy across all business segments.

Strategic Initiatives & Product Approvals

Abbott highlighted several significant regulatory achievements that expand its global reach in structural heart treatments. The company received CE Mark approval for an expanded indication for its Navitor® transcatheter aortic valve implantation system, allowing treatment of people with symptomatic, severe aortic stenosis who are at low or intermediate risk for open-heart surgery. This approval broadens the potential patient population that can benefit from this minimally invasive alternative to open-heart surgery.

In Japan, Abbott secured regulatory approval for TriClip®, a first-of-its-kind, minimally invasive treatment option for patients with a leaky tricuspid heart valve. This approval extends the company’s structural heart innovations to a key Asian market and addresses an important unmet medical need.

The company also launched a nationwide blood donation initiative in partnership with the Big Ten Conference, leveraging Abbott’s position as a screener of more than 50% of the world’s blood supply. The campaign aims to address critical blood shortages in the United States, where blood is needed every two seconds and some centers have less than a day’s supply.

Forward-Looking Statements

Abbott reaffirmed and narrowed its full-year 2025 guidance, projecting adjusted diluted EPS of $5.12 to $5.18, which reflects double-digit growth at the midpoint compared to the previous year. The company also maintained its organic sales growth forecast of 7.5% to 8.0%, excluding COVID-19 testing-related sales.

Looking ahead to 2026, management indicated expectations for continued high single-digit organic sales growth and double-digit EPS growth. The company remains committed to its dividend program, having maintained dividend payments for 55 consecutive years and raised dividends for 12 straight years.

Despite current challenges in China, Abbott targets mid-single-digit growth in that market moving forward. The company’s strong cash flows and financial position enable continued investment in its product pipeline while delivering shareholder returns, positioning Abbott to navigate market uncertainties while pursuing long-term growth opportunities.

Full presentation:

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.