TLDR
- Abbott Laboratories shares fell 8% after Q4 revenue of $11.5 billion came in below the $11.8 billion analyst estimate
- Nutrition segment sales declined 8.9% as price increases dampened consumer demand and higher commodity costs persisted
- Medical devices grew 12% and established pharmaceuticals rose 9%, while diagnostics dropped 2.5%
- 2026 guidance calls for adjusted EPS of $5.55 to $5.80 with organic sales growth of 6.5% to 7.5%
- The pending $21 billion Exact Sciences acquisition remains on track for Q2 2026 closing
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Abbott Laboratories posted fourth-quarter results Thursday that sent shares down 8% despite meeting earnings expectations. The healthcare company reported adjusted earnings of $1.50 per share, in line with analyst forecasts.
Abbott, $ABT, Q4-25. Results:
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???? Strong margin expansion and double-digit EPS growth; medical devices and electrophysiology drove performance gains. pic.twitter.com/RLzzBJ6P2m— EarningsTime (@Earnings_Time) January 22, 2026
Revenue painted a bleaker picture. Abbott recorded $11.5 billion in sales, falling short of the $11.8 billion Wall Street target. The company achieved 3% organic sales growth compared to the prior year.
The nutrition business continues its downward spiral. Sales in this division tanked 8.9% during the quarter. The segment includes popular brands like Similac baby formula and Ensure nutritional drinks.
Abbott Laboratories, ABT
CEO Robert Ford acknowledged the persistent problems during the earnings call. He pointed to manufacturing costs that have steadily increased over recent years. Commodity prices spiked during the pandemic and haven’t come back down.
Abbott tried raising prices to offset these expenses. But those price hikes are now hurting sales volume as shoppers become more selective with their spending. Ford noted many consumer goods companies face this same challenge.
Device Sales Provide Bright Spot
Not all business lines struggled. The medical devices division delivered strong performance with sales jumping 12%. Established pharmaceuticals rose 9% year-over-year.
Diagnostics sales slipped 2.5% in the quarter. Abbott expected this decline due to reduced COVID testing compared to the previous year.
The stock opened at $120.82 Thursday and continued sliding throughout the trading day. The S&P 500 index climbed 0.6% during the same session. Healthcare peer Johnson & Johnson gained 0.9% after reporting Wednesday.
Company Sets 2026 Targets
Abbott issued guidance for the upcoming year alongside quarterly results. Management expects adjusted earnings ranging from $5.55 to $5.80 per share. The midpoint aligns with the $5.68 analyst consensus.
The company forecasts organic sales growth between 6.5% and 7.5% for 2026. Ford stated Abbott is “well-positioned for accelerating growth in 2026” in a prepared statement.
Abbott is moving ahead with its planned acquisition of Exact Sciences. The $21 billion deal represents Abbott’s biggest purchase since 2017. Exact Sciences produces Cologuard, a popular at-home test for colorectal cancer screening.
The company confirmed Thursday the acquisition should close sometime in the second quarter of 2026.
This marks the second time in recent months Abbott shares have dropped on earnings day despite solid fundamentals. Back in July, the stock tumbled 8.5% when second-quarter earnings met estimates but guidance disappointed investors.
Abbott boosted its quarterly dividend as part of the announcement. The new payout is $0.63 per share, up from $0.59 previously. This equals an annualized dividend of $2.52 with a 2.1% yield. The payment goes to shareholders of record on January 15th and will be distributed February 13th.
