Abbott Falls Short of Q4 Sales Expectations, But Medical Devices Shine

Summary

Abbott’s Q4 2024 earnings show a mixed bag: sales missed Wall Street’s projections, but medical devices experienced robust growth, and adjusted EPS met expectations. The company’s overall performance and future outlook remain positive, driven by innovative products and strategic investments. Abbott anticipates continued growth in 2025, fueled by advancements in medical technology.

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Main Story

Okay, so Abbott Labs just dropped their Q4 2024 financials, and it’s… well, it’s a bit of a mixed bag, honestly. You know, the kind where some parts shine and others, not so much. On the one hand, they didn’t quite hit the sales numbers Wall Street was expecting. But, on the other, their medical devices division absolutely crushed it, and their adjusted earnings per share? Right on target.

Let’s break it down, shall we?

First off, their sales came in at $10.97 billion. Now, that’s a solid 7.2% jump from the same time last year, which is great! But, and this is a key “but”, analysts had predicted $11.03 billion. It’s not a huge miss, but it’s a miss nonetheless. However, the good news is their adjusted EPS hit $1.34, exactly what was expected, and that’s a nice improvement over last year’s $1.19. This is partly down to solid performance from some key business areas and, of course, managing costs—which, let’s face it, is always a big deal.

Now, for the real star of the show: medical devices. This division saw a huge 13.7% sales increase, clocking in at $5.05 billion, wow! It’s like, they’re on a roll. This growth wasn’t thanks to just one thing either, it was a whole team of rockstars, including the FreeStyle Libre continuous glucose monitor, the Navitor heart valve, the TriClip valve repair device, and the Amplatzer Amulet appendage occluder. For instance, the FreeStyle Libre system alone made $1.8 billion, a 22.7% growth, mind-blowing stuff! This just screams demand for innovative medical solutions, don’t you think?

Taking a step back, looking at the whole year, 2024, Abbott pulled in $42 billion in sales. That’s a 4.6% jump on the reported numbers, but here’s the kicker – when you strip out all the COVID-related testing sales, it’s a hefty 9.6% growth. Full-year adjusted EPS came in at $4.67, also pretty solid. As a result, despite the slight sales dip in the fourth quarter, they’re still in a pretty good spot.

Looking ahead, Abbott is feeling pretty confident about 2025. They’re forecasting organic sales growth of 7.5% to 8.5% for the year. Plus, they reckon adjusted EPS will be somewhere between $5.05 and $5.25, which suggests they’re not slowing down. Their investments in research and development (R&D) are paying off with a solid pipeline of new products and technologies. In other words, they’re playing the long game, which I like.

Medical technology, in general, is really booming at the moment. We’re seeing so many innovations, spurred by factors like increased chronic disease, a desire for less invasive treatments, and a move towards digital health. And it’s obvious why: people want better care, more convenient care. Abbott, with its focus on cutting-edge medical tech and R&D, is well placed to benefit. For instance, they recently announced some improvements in their cardiac monitoring tech, which are huge strides for people with heart conditions. As of January 24, 2025, they seem well set up for ongoing success. That said, we all know that market conditions and things out of their control can impact what happens. So, keep an eye on them, and it’ll be interesting to see what 2025 holds. In conclusion, while it wasn’t a perfect quarter, Abbott certainly seems to be navigating the evolving healthcare landscape with some strategic acumen.