Abbott (ABT) Q2 Earnings Surpass Estimates, Margins Expand

Earnings and Revenue Performance - Abbott Laboratories reported Q2 2024 adjusted EPS of $1.14, beating the Zacks Consensus Estimate by 3.6% and increasing 5.6% YoY [1] - GAAP EPS was 74 cents, down 5.1% YoY [1] - Worldwide sales reached $10.38 billion, up 4% YoY on a reported basis and exceeding the Zacks Consensus Estimate by 0.3% [1] - Organic sales grew 7.4% YoY, with a 9.3% increase excluding COVID-19 testing sales [1] Segment Performance - Established Pharmaceuticals sales increased 0.6% on a reported basis (8.1% organic) to $1.29 billion, with 8.8% organic growth in emerging markets [2] - Medical Devices sales rose 10.2% on a reported basis (12.1% organic) to $4.73 billion, driven by double-digit growth in Diabetes Care, Electrophysiology, and Structural Heart [2] - Diabetes Care organic sales grew 18.2% YoY, with FreeStyle Libre contributing $1.6 billion in revenue [3] - Structural Heart sales increased 15.6%, while Heart Failure sales grew 8.9% organically [3] - Nutrition sales rose 3.5% on a reported basis (7.5% organic) to $2.15 billion, with Adult Nutrition sales up 9.9% organically [5] - Diagnostics sales declined 5.3% on a reported basis (1.5% organic) to $2.20 billion, with Core Laboratory Diagnostics up 8.6% organically but Rapid Diagnostics down 19.8% [5] Margins and Expenses - Gross profit increased 5.1% YoY to $5.77 billion, with gross margin expanding 57 bps to 55.6% [6] - Selling, general, and administration expenses rose 7.2% YoY to $2.94 billion, while R&D expenses fell 2.4% to $698 million [6] - Adjusted operating profit grew 4.9% YoY to $2.14 billion, with the adjusted operating margin expanding 18 bps to 20.6% [6] 2024 Guidance - Full-year adjusted EPS guidance updated to $4.61-$4.71 (previously $4.55-$4.70), with the Zacks Consensus Estimate at $4.62 [7] - Full-year organic sales growth, excluding COVID-19 testing, expected at 9.5%-10% (previously 8.5%-10%), with the Zacks Consensus Estimate for sales at $41.66 billion [7] R&D and Product Developments - Abbott announced 10 new growth opportunities from its R&D pipeline in H1 2024, including new product approvals and treatment indications [8] - Notable developments include CE Mark approval for the AVEIR dual chamber leadless pacemaker system, FDA clearance for two new over-the-counter continuous glucose monitoring systems, and FDA approval of the Esprit below-the-knee system [8] Industry Comparison - Globus Medical reported Q1 2024 EPS of 72 cents, beating estimates by 30.9%, with revenues of $606.7 million topping estimates by 3.4% [10] - Insulet reported Q1 2024 earnings of 73 cents, surpassing estimates by 87.2%, with revenues of $441.7 million exceeding estimates by 4.3% [11] - Haemonetics reported fiscal 2024 Q4 adjusted EPS of 90 cents, beating estimates by 2.3%, with revenues of $343.3 million exceeding estimates by 5% [11]