Abbott
(NYSE: ABT)
today announced second-quarter results that beat the consensus of Wall Street analysts — boosting its full-year organic sales growth forecast.
The company has now seen two quarters in a row of double-digit organic sales growth in its underlying business. Even as COVID-19 test sales continue to decline and hammer overall revenue, Abbott officials are betting on a productive, innovative pipeline to build momentum — especially in its Medical Device business. CEO Robert Ford said underlying demand trends continue to improve. “Healthcare systems around the world have improved the supply of healthcare services,” Ford told analysts today.
Ford concluded: “Momentum is building. We’re well-positioned heading into the second half of this year and heading into next year.”
Investors reacted by sending ABT shares up more than 4% to $112.17 apiece in morning trading. MassDevice‘s MedTech 100 Index, which includes stocks of the world’s largest medical device companies, was up slightly.
The life sciences tech giant earned $1.38 billion, or 78¢ per share, off of $9.98 billion for the quarter ended June 30, 2023. The results represented a bottom-line slide of 32% and a top-line decline of 11.4% compared with Q2 2022.
Adjusted to exclude one-time items, Abbott had second-quarter earnings per share of $1.08 per share. That’s 3¢ ahead of The Street, where analysts predicted EPS of $1.05 and sales of $9.7 billion.
“We’re achieving strong growth in our underlying base business,” Abbott CEO Robert B. Ford said in a news release. “We expect our highly productive pipeline to sustain the momentum we’re building this year and position us well for growth in the future.”
Medical devices are a bright spot for Abbott
Abbott’s Medical Device business saw organic sales grow more than 14% organically year-over-year to $4.30 billion in Q2. That’s compared to a 45% decline in Diagnostics, 9.9% gain in Nutrition, and 12.6% gain in Established Pharmaceuticals.
Ford noted that the Medical Device business saw double-digit growth in both the U.S. and internationally. The company’s FreeStyle Libre CGMs remain an especially strong growth driver.
Market opportunities for FreeStyle Libre continue to expand, too. Last month, French authorities expanded FreeStyle Libre 2 coverage to all people who use basal insulin as part of their diabetes management; Japan and the U.S. Medicare program have made similar coverage expansions.
In the second half of the year, Ford expects Abbott to achieve integration of FreeStyle Libre with Tandem Diabetes Care insulin delivery systems in the U.S. The company will also launch a 15-day sensor in the U.S.
Just over the past weekend, Abbott successfully achieved its first successful conversion of Libre 2s from scanning to real-time conversion. By July 17, the company had converted 90% of U.K. users to scanning.
Abbott has also just launched its Lingo biosensor in the U.K., Ford said. The goal is to provide a consumer version of CGM tech that can enable people without diabetes to still gain insights about their metabolism and glucose spikes, Ford said. Abbott plans to file by the end of the year to sell Lingo in the U.S. Ford described it as a significant growth driver over time.
Abbott also achieved other medical device wins in Q2
In May, Abbott received FDA approval of its TactiFlex Ablation Catheter, Sensor Enabled. The company describes it as the world’s first ablation catheter with a unique flexible electrode tip and contact force sensing technology to treat patients with atrial fibrillation.
The next month, the FDA approved Abbott’s Aveir dual chamber leadless pacemaker system, which the company says is another first. It’s a dual-chamber leadless pacing system that treats people with abnormal heart rhythms.
Abbott stuck with its projected full-year adjusted EPS of $4.30 to $4.50. The range is unchanged but reflects an increased outlook for the underlying base business offset by a lower forecasted earnings contribution from COVID-19 testing-related sales, according to the company.
Abbott now projects full-year 2023 organic sales growth, excluding COVID-19 testing-related sales, to be in the low double digits versus a previous prediction of at least in the high single digits. It predicts COVID-19 testing-related sales of approximately $1.3 billion, down from $1.5 billion.
