Abbott(ABT) ZACKS·2025-02-19 15:45Core Insights - Abbott's diversified business portfolio is positioned for continued momentum in 2025 despite challenges in the international business environment [1] Group 1: Business Performance - Abbott is strategically advancing in biosimilars within its Established Pharmaceuticals Division, with commercialization expected in 2025, targeting emerging markets [2] - The Diagnostics business accounted for 23% of total revenues in Q4 2024, with a 16% year-over-year increase in rapid diagnostics sales, excluding COVID-19 testing [3] - Sales of the FreeStyle Libre continuous glucose monitoring system in the Diabetes Care segment exceeded 6.5 billion for the full year, reflecting a 22% increase from 2023 [4][5] Group 2: Market Trends - Over the past three months, Abbott's shares increased by 11.8%, outperforming the industry growth of 6.2%, driven by expansion in high-growth areas and new product launches [6] - The company faces foreign exchange challenges, with a 1.4% unfavorable impact on sales in Q4 2024 due to a significant portion of revenues coming from international markets [7] Group 3: Cost and Margin Analysis - Abbott experienced an 8.5% increase in the cost of products sold in Q4 2024, leading to a contraction of 55 basis points in gross margin to 55% [9] - Selling, general, and administrative expenses rose by 6.7% year-over-year, resulting in a 43-basis point contraction in adjusted operating margin [9] Group 4: Industry Context - The ongoing complex geopolitical situation is leading to increased raw material and freight costs, impacting Abbott's business and the MedTech industry overall [8]