Abbott Laboratories ended the fourth quarter with sales growth below Wall Street’s expectations, driven primarily by ongoing challenges in its nutrition segment. Management attributed this underperformance to price-driven volume declines, particularly following the loss of a major U.S. WIC contract and ongoing consumer price sensitivity. CEO Robert Ford acknowledged the need for a shift, stating, “This path is not sustainable long-term, so we began to make changes in the fourth quarter.” The company also cited higher manufacturing costs in nutrition that have yet to be offset, resulting in a cautious tone around near-term growth in this key division.
Is now the time to buy ABT? Find out in our full research report (it’s free for active Edge members).
Abbott Laboratories (ABT) Q4 CY2025 Highlights:
- Revenue: $11.46 billion vs analyst estimates of $11.8 billion (4.4% year-on-year growth, 2.9% miss)
- Adjusted EPS: $1.50 vs analyst estimates of $1.49 (in line)
- Adjusted EBITDA: $3.32 billion vs analyst estimates of $3.42 billion (29% margin, 3% miss)
- Adjusted EPS guidance for the upcoming financial year 2026 is $5.68 at the midpoint, in line with analyst estimates
- Operating Margin: 19.6%, up from 17.4% in the same quarter last year
- Organic Revenue rose 3% year on year (miss)
- Market Capitalization: $184.4 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Abbott Laboratories’s Q4 Earnings Call
- Larry Biegelsen (Wells Fargo) asked about the lower revenue growth outlook and its connection to nutrition weakness. CEO Robert Ford explained that volume pressures accelerated due to price sensitivity, but early signs from new pricing and promotional activities are encouraging.
- David Roman (Goldman Sachs) inquired about the pipeline for electrophysiology and competitive positioning. Ford described the comprehensive portfolio approach and strong feedback from the Volt PFA catheter launch, expecting growth at least in line with market in 2026.
- Robbie Marcus (JPMorgan) questioned expectations for continued rapid growth in CGM and margin expansion. Ford confirmed ongoing robust demand and highlighted opportunities for further penetration, while CFO Philip Boudreau guided to continued margin improvement through gross margin gains and cost leverage.
- Vijay Kumar (Evercore ISI) pressed for clarity on the Aveir pacemaker’s penetration and capital allocation post-Exact Sciences deal. Ford described Aveir as early in adoption, with significant opportunity remaining, and emphasized that near-term M&A focus will be on integrating Exact Sciences.
- Danielle Antalffy (UBS) sought details on pricing strategy in nutrition and its profitability impact. Ford said pricing tests showed early positive signs but will require ongoing monitoring, and that nutrition profitability should be steady as the business shifts focus to volume growth.
Catalysts in Upcoming Quarters
Looking ahead, the StockStory team will be closely tracking (1) the pace and effectiveness of pricing and promotional changes in nutrition, (2) execution and adoption of new product launches in medical devices and diabetes care, and (3) the timeline and integration progress of the Exact Sciences acquisition. These milestones will be central to assessing Abbott’s ability to deliver on its growth and margin targets for 2026.
Abbott Laboratories currently trades at $106.08, down from $120.73 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free).
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