Abbott reports fourth-quarter sales that miss analysts' estimates. ...

Earnings Per Share (EPS) - Fourth-quarter GAAP diluted EPS was $1.01, and adjusted diluted EPS was $1.50, reflecting a growth of 12%[3] - Full-year 2025 GAAP diluted EPS was $3.72, and adjusted diluted EPS was $5.15, reflecting a growth of 10%[3] - Abbott expects full-year 2026 adjusted diluted EPS to be between $5.55 and $5.80, indicating a 10% growth at the midpoint[3] - In Q4 2025, Abbott reported a net earnings of $1.776 billion, which adjusted to $2.630 billion after specified items, resulting in a diluted earnings per share of $1.01 and $1.50 respectively[37] Sales Performance - Full-year 2025 sales reached $44.3 billion, an increase of 5.7% on a reported basis and 5.5% on an organic basis[3] - Fourth-quarter sales increased by 4.4% on a reported basis and 3.0% on an organic basis, or 3.8% when excluding COVID-19 testing-related sales[3] - In Q4 2025, total worldwide sales reached $11.459 billion, a 4.4% increase from $10.974 billion in Q4 2024[27] - For the full year 2025, total worldwide sales were $44.328 billion, up 5.7% from $41.950 billion in 2024[32] - In Q4 2025, U.S. sales were $2.605 billion, reflecting a 10.7% increase compared to Q4 2024[17] - International sales in Q4 2025 totaled $3.070 billion, marking a 13.7% increase year-over-year[17] - The Diabetes Care segment reported sales of $2.0 billion in Q4 2025, growing 15.0% on a reported basis[18] - Abbott's international revenue for 2025 was $27.202 billion, up 6.1% from $25.627 billion in 2024[49] Future Projections - Abbott projects full-year 2026 organic sales growth to be in the range of 6.5% to 7.5%[3] - The company plans to continue focusing on market expansion and new product development as part of its growth strategy[52] Expenses and Margins - Abbott's R&D expenses for 2025 were $2.942 billion, adjusted to $2.830 billion, showing a slight increase from $2.844 billion in 2024[41] - The company's SG&A expenses for 2025 were reported at $12.332 billion, adjusted to $12.020 billion, compared to $11.697 billion in 2024[41] - The gross margin for Q4 2025 was $6.115 billion, adjusted to $6.543 billion after accounting for specified items, reflecting an increase from Q4 2024's adjusted gross margin of $6.240 billion[37][38] - Gross margin for the twelve months ended December 31, 2025, was $1,824 million, with a contribution of $1,682 million from intangible amortization[57] Net Earnings - Net earnings for Q4 2025 were $1.776 billion, compared to $9.229 billion in Q4 2024, with significant adjustments impacting the figures[29] - For the full year 2025, Abbott's net earnings were reported at $6.524 billion, adjusted to $9.040 billion, with diluted earnings per share increasing from $3.72 to $5.15[41] - Net earnings for the same period were $2,516 million, resulting in diluted earnings per share of $1.43[57] - For the twelve months ended December 31, 2024, net earnings were reported as a loss of $5,202 million, leading to diluted earnings per share of $(2.97)[60] Acquisitions and Approvals - Abbott announced an agreement to acquire Exact Sciences to enter the cancer diagnostics market, with the transaction expected to close in Q2 2026[3] - Abbott received FDA approval for its Volt™ PFA System and CE Mark for its TactiFlex™ Duo Ablation Catheter, enhancing its Electrophysiology leadership[3] Tax and Other Items - In Q4 2025, the effective tax rate excluding specified items was 14.8%, compared to 15.0% in Q4 2024[44] - The specified items in Q4 2025 included $422 million in intangible amortization and $306 million in other net expenses related to restructuring and acquisitions[37][50] - The company recognized a tax benefit of approximately $610 million due to the resolution of various tax positions related to prior years[58] - Acquisition-related expenses included integration costs directly related to integrating acquired businesses[55]

Core Insights - Abbott missed Wall Street estimates for quarterly revenue, primarily due to weakness in its diagnostic business, which has been affected by a significant decline in COVID-19 testing demand [1] Group 1: Financial Performance - The company's quarterly revenue fell short of expectations, indicating challenges in maintaining growth in its diagnostic segment [1] - The decline in COVID-19 testing demand has led to volatility in Abbott's diagnostic business, impacting overall revenue performance [1] Group 2: Market Conditions - The current market conditions reflect a sharp decrease in demand for COVID-19 testing, which has been a critical factor in Abbott's recent financial results [1] - The freeze on certain diagnostic services has further contributed to the challenges faced by the company in this segment [1]

Core Insights - Abbott reported strong financial results for Q4 2025, with total worldwide sales reaching $11.459 billion, a 4.4% increase from Q4 2024 [28] - The company achieved double-digit earnings per share growth, with adjusted diluted EPS of $1.50, reflecting a 12% increase [5] - Abbott's full-year 2025 sales totaled $44.328 billion, marking a 5.7% increase compared to 2024 [28] Financial Performance - Q4 2025 sales increased 4.4% on a reported basis and 3.0% on an organic basis, with a 3.8% increase when excluding COVID-19 testing-related sales [5][28] - Full-year 2025 GAAP diluted EPS was $3.72, while adjusted diluted EPS was $5.15, reflecting a 10% growth [5][28] - Abbott projects full-year 2026 organic sales growth to be in the range of 6.5% to 7.5% and adjusted diluted EPS of $5.55 to $5.80 [5][22] Segment Performance - In Q4 2025, Nutrition sales decreased by 8.9% on a reported basis and 9.1% on an organic basis, primarily due to lower sales volumes [9][10] - Diagnostics sales in Q4 2025 were $2.457 billion, a decrease of 2.5% on a reported basis and 3.6% on an organic basis [12][28] - Medical Devices sales increased by 12.3% on a reported basis and 10.4% on an organic basis, driven by strong growth in Electrophysiology and Diabetes Care [19][20] Strategic Developments - Abbott announced an agreement to acquire Exact Sciences, positioning the company to enter the cancer diagnostics market [5] - The company received FDA approval for its Volt™ PFA System and CE Mark for its TactiFlex™ Duo Ablation Catheter, enhancing its Electrophysiology portfolio [5][10] Dividend Information - Abbott declared a quarterly dividend of $0.63 per share, marking the 408th consecutive quarterly dividend and reflecting a commitment to returning value to shareholders [24]

Earnings Report - Abbott Laboratories is set to release its fourth-quarter earnings on January 22, with expected earnings of $1.49 per share, an increase from $1.34 per share in the same period last year [1] - The consensus estimate for Abbott's quarterly revenue is $11.8 billion, up from $10.97 billion reported last year [1] Recent Developments - On January 20, Abbott received CE Mark approval for the TactiFlex™ Duo Ablation Catheter, aimed at treating patients with abnormal heart rhythms [2] - Following this news, Abbott's shares fell by 0.3%, closing at $120.73 [2] Analyst Ratings - Bernstein analyst Lee Hambright maintained an Outperform rating and raised the price target from $150 to $154 [3] - Barclays analyst Matt Miksic maintained an Overweight rating and increased the price target from $162 to $169 [3] - BTIG analyst Marie Thibault maintained a Buy rating with a price target of $145 [3] - Raymond James analyst Jayson Bedford maintained an Outperform rating and raised the price target from $141 to $146 [3] - Evercore ISI Group analyst Vijay Kumar maintained an Outperform rating but reduced the price target from $144 to $142 [3]

Market Sentiment - The CNN Money Fear and Greed index showed an improvement in overall market sentiment, remaining in the "Neutral" zone with a current reading of 50.4, up from 46.4 [4][5] - U.S. stocks settled higher, with the S&P 500 gaining more than 1% during the session as President Trump withdrew his latest round of tariff threats [1][2] Company Earnings - Johnson & Johnson reported better-than-expected fourth-quarter earnings [2] - Netflix shares fell around 2% after reporting fourth-quarter financial results and issuing first-quarter guidance below estimates [2] Economic Data - U.S. pending home sales dipped by 9.3% month-over-month in December, following a 3.3% gain in November, and compared to market estimates of a 0.3% decline [3] - U.S. construction spending increased by 0.5% month-over-month in October, compared to a 0.6% gain in September and versus market expectations of a 0.1% gain [3] Stock Market Performance - The Dow Jones closed higher by around 589 points to 49,077.23, while the S&P 500 rose 1.16% to 6,875.62, and the Nasdaq Composite gained 1.18% to 23,224.82 during the session [4]

Core Viewpoint - U.S. stock futures are trading higher, with several companies expected to report earnings that may attract investor attention today [1] Group 1: Company Earnings Reports - Abbott Laboratories (NYSE:ABT) is expected to report quarterly earnings of $1.50 per share on revenue of $11.81 billion, with shares rising 0.2% to $121.01 in after-hours trading [1] - Kinder Morgan Inc. (NYSE:KMI) reported positive financial results for Q4 and lowered its full-year 2026 adjusted earnings guidance, with a cash dividend of $0.2925 per share for Q4, up 2% year-over-year; shares gained 0.4% to $28.68 [1] - Procter & Gamble Co. (NYSE:PG) is anticipated to post quarterly earnings of $1.86 per share on revenue of $22.28 billion, with shares falling 0.4% to $145.50 in after-hours trading [1] - CACI International Inc. (NYSE:CACI) exceeded earnings expectations for Q2 and raised its FY2026 guidance, with shares increasing 0.8% to $637.71 in after-hours trading [1] - Intel Corp. (NASDAQ:INTC) is expected to report quarterly earnings of 8 cents per share on revenue of $13.38 billion, with shares rising 1.2% to $54.92 in after-hours trading [1]

Group 1 - The fourth quarter earnings season is gaining momentum, with major financial institutions like Charles Schwab and regional banks such as Fifth Third set to report results, alongside Netflix and Intel, which are expected to be focal points [1][5] - An optimistic consensus is emerging, with 7% of S&P 500 companies having reported fourth quarter results as of January 16, and analysts projecting an 8.2% increase in earnings per share for the quarter, marking the 10th consecutive quarter of annual earnings growth for the index [2] - Analysts had initially anticipated an 8.3% increase in earnings per share heading into the reporting period, a decrease from the previous quarter's 13.6% growth rate, but expectations have been raised recently, particularly for technology companies [3] Group 2 - The current earnings season is expected to test the improved stock market breadth observed at the beginning of 2026, with ongoing themes from 2025, such as artificial intelligence and economic policies, continuing to influence market dynamics [4] - This week's earnings releases will also include reports from notable companies such as United Airlines, 3M Company, D.R. Horton, Johnson & Johnson, GE Aerospace, Procter & Gamble, Abbott Laboratories, and Capital One [5]

Group 1 - The fourth quarter earnings season is gaining momentum, with major financial institutions like Charles Schwab and regional banks such as Fifth Third set to report results, alongside Netflix and Intel, which are expected to be focal points of the earnings calendar [1][5] - An optimistic consensus is emerging, with 7% of S&P 500 companies having reported fourth quarter results as of January 16, and analysts projecting an 8.2% increase in earnings per share for the quarter, marking the potential for the 10th consecutive quarter of annual earnings growth for the index [2] - Analysts had initially anticipated an 8.3% increase in earnings per share heading into the reporting period, a decrease from the previous quarter's 13.6% growth rate, but expectations have been raised recently, particularly for technology companies that have been key drivers of earnings growth [3] Group 2 - The current earnings season is expected to test the improved stock market breadth observed at the beginning of 2026, with ongoing themes from 2025, such as artificial intelligence and economic policies, continuing to influence market dynamics [4] - This week's earnings releases will also include reports from notable companies such as United Airlines, 3M Company, D.R. Horton, Johnson & Johnson, GE Aerospace, Procter & Gamble, Abbott Laboratories, and Capital One [5]

Core Viewpoint - India's largest drugmaker Sun Pharma is reportedly bidding for American pharmaceutical company Organon in a deal potentially worth $10 billion, which would mark the largest overseas acquisition by an Indian pharma company [1][2] Group 1: Acquisition Details - Sun Pharma has secured $10–14 billion in temporary 'bridge loans' to fund the acquisition of Organon [1] - The deal would allow Sun Pharma to expand beyond generics into higher-margin specialty and innovative branded markets, aligning with the company's long-term goals [2] - Organon, spun off from Merck in 2021, has a revenue of about $6.4 billion and an EBITDA of $1.96 billion for FY24, but comes with a significant debt of $8.9 billion [5] Group 2: Market Reactions - The potential acquisition has divided market opinions, with some investors supporting the move due to Sun Pharma's strong management and track record, while others express concerns over Organon's debt and governance issues [2][4] - Sun Pharma's stock price saw a decline of 3.23% on the NSE, reflecting investor apprehension regarding the deal valuation and Organon's financial health [4] Group 3: Strategic Implications - The acquisition could enhance Sun Pharma's US sales, increasing its earnings from over $1.6 billion in North America to potentially over $3 billion [7] - Analysts suggest that while Organon is not a growth asset, it has elements that could contribute to earnings growth through cost rationalizations [6] - The deal represents a significant shift for Sun Pharma, indicating a willingness to pursue large acquisitions again, contrasting with its recent strategy of smaller deals [17]