Abbott Reports Strong Third-Quarter Performance with a 4.9% Increase in Worldwide Sales
Abbott Laboratories (NYSE: ABT) reported a robust performance for the third quarter of 2024, with total worldwide sales reaching $10.635 billion, marking a 4.9% increase from the previous year.
This growth was primarily driven by strong performances in the Medical Devices segment, which saw an 11.7% increase in sales on a reported basis and 13.3% on an organic basis. Key contributors to this growth included the FreeStyle Libre in Diabetes Care and the Amplatzer Amulet in Structural Heart.
The company reported a GAAP diluted earnings per share (EPS) of $0.94, while the adjusted diluted EPS, which excludes specified items, was $1.21. This reflects a 6.1% increase compared to the adjusted EPS of $1.14 in the third quarter of 2023. Abbott’s diversified business model continues to be a significant strength, with the Medical Devices segment leading the way with double-digit growth in the U.S. and internationally.
Abbott’s Diagnostics segment, however, faced challenges due to a decline in COVID-19 testing-related sales, which fell to $265 million from $305 million in the prior year. Excluding these sales, the segment still managed to achieve a 3.3% organic growth, driven by the continued adoption of the Alinity diagnostics systems. This performance underscores Abbott’s ability to adapt and thrive despite the waning demand for COVID-19 testing.
Abbott Reports Better than Expected Third Quarter
Abbott’s third-quarter performance exceeded market expectations, particularly in terms of adjusted EPS. The consensus expectation for the quarter was an EPS of $1.20 and revenue of $10.56 billion. With an adjusted EPS of $1.21 and revenue of $10.635 billion, Abbott surpassed both benchmarks, showcasing its operational efficiency and strategic growth in key segments.
The Medical Devices segment was a standout performer, with an 11.7% increase in reported sales, significantly contributing to the company’s ability to surpass revenue expectations. The growth in this segment was primarily driven by innovative products like FreeStyle Libre and Amplatzer Amulet, which saw increased adoption and market penetration.
Despite the decline in COVID-19 testing sales in the Diagnostics segment, Abbott’s overall performance was bolstered by strong organic growth in its core laboratory diagnostics. This highlights the company’s successful transition from pandemic-related sales to focusing on its core business areas, which continue to show resilience and growth.
Abbott Raises Midpoint of Full Year EPS Guidance, Expecting Adj. Diluted EPS of $4.64 to $4.70
Abbott has raised the midpoint of its full-year EPS guidance range, now projecting a GAAP diluted EPS of $3.34 to $3.40 and an adjusted diluted EPS of $4.64 to $4.70.
This upward revision reflects the company’s confidence in its continued growth trajectory and the strength of its diversified portfolio. Abbott’s commitment to innovation and strategic partnerships, such as the collaboration with Medtronic on continuous glucose monitoring, positions it well for sustained future growth.
Abbott’s full-year organic sales growth guidance remains at 9.5% to 10.0%, excluding COVID-19 testing-related sales. This guidance underscores the company’s expectation of continued strong performance in its core business areas, particularly in Medical Devices and Diagnostics. The company’s recent product launches and partnerships are expected to contribute positively to its growth outlook.
In addition to its financial guidance, Abbott’s board of directors has authorized a new share repurchase program of up to $7 billion. This move reflects the company’s strong cash flow generation and commitment to returning value to shareholders.
Disclaimer: The author does not hold or have a position in any securities discussed in the article.
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