Note: This story has been updated with comments from a conference call to discuss the firm's financial results.
NEW YORK — Abbott escaped the COVID-19 "sales decline cloud" in 2024 and is prepared to deliver "another year of strong growth," CEO and Chairman Robert Ford said on a conference call to discuss the firm's Q4 financial results Wednesday morning.
That COVID-19 sales overhang, which has affected almost all diagnostic and life science tools companies for several years now, was previously "overshadowing all of these real strong growth drivers," such as a strong product pipeline with a "steady cadence of new growth opportunities." The firm is "seeing acceleration" in several of the markets in which it competes, and its product portfolios are either keeping up with or outperforming competitors in those markets, Ford noted.
"We feel very good about all of the businesses," he added.
For the three months ended Dec. 31, 2024, the Abbott Park, Illinois-based firm reported overall revenues of $10.97 billion, up 7 percent from $10.24 billion a year ago and missing the consensus Wall Street estimate of $11.03 billion. On an organic basis, which excludes the impact of foreign currency exchange, revenues rose 9 percent year over year.
Excluding COVID-19 testing-related sales, revenues rose 10 percent on an organic basis for 2024, Abbott said.
The company said revenues from its diagnostics business fell 1 percent from the prior-year quarter to $2.52 billion from $2.53 billion but rose 1 percent on an organic basis and rose 4 percent when excluding COVID-19 testing-related sales. On an organic basis excluding COVID-19 testing-related sales, diagnostics revenues rose 6 percent. Within diagnostics, core laboratory revenues increased 1 percent year over year to $1.39 billion from $1.37 billion, while molecular revenues declined nearly 11 percent to $137 million from $153 million. Its point-of-care revenues declined 1 percent to $147 million from $149 million, and rapid diagnostics revenues were $849 million, down nearly 2 percent from $862 million in the prior-year quarter.
Global COVID-19 testing-related sales were $176 million in the recently completed quarter, compared to $288 million in Q4 2023. Excluding COVID-19 testing-related sales, core laboratory revenues were up 4 percent, molecular revenues declined 7 percent, point-of-care revenues decreased 1 percent, and rapid diagnostics revenues were up 16 percent, all on an organic basis, Abbott said. Growth in rapid diagnostics was driven by strong demand for Abbott's respiratory disease tests for influenza, strep throat, and respiratory syncytial virus, the company added.
Ford said that growth in the core labs business was driven by "continued strong demand" for immunoassay, clinical chemistry, hematology, and blood screening testing panels.
A large portion of the firm's diagnostics business is hospital-based testing, and the firm is seeing an increase in routine diagnostic test utilization in the high-single digit to low-double digit percent range, Ford said.
While there were "challenging market dynamics" in China, the combined diagnostics growth in all other markets was in the double-digit percent range in Q4, he added.
Evercore ISI analyst Vijay Kumar wrote in a note to investors that Abbott's core labs business continues to be impacted by China's volume-based procurement program implemented last year.
Abbott's nutrition revenues increased nearly 5 percent year over year in Q4 2024 to $2.13 billion from $2.04 billion. Its established pharmaceuticals revenues rose 4 percent to $1.27 billion from $1.22 billion, and medical devices revenues rose 14 percent to $5.05 billion from $4.44 billion.
Abbott reported net earnings of $9.23 billion, or $5.27 per share, in Q4 2024 compared to $1.59 billion, or $.91 per share, in the year-ago period. Adjusted EPS for the recently completed quarter was $1.34, meeting the consensus Wall Street estimate.
For full-year 2024, the firm reported total revenues of $41.95 billion, up 5 percent from $40.11 billion a year ago, slightly missing the average Wall Street estimate of $41.99 billion. On an organic basis, total revenues rose 7 percent, and excluding COVID-19 testing-related sales, the firm's revenues were up 10 percent.
Abbott reported $9.34 billion in diagnostics revenues in 2024, down 7 percent on a reported basis from $9.99 billion in 2023 and down 4 percent on an organic basis. Excluding COVID-19 testing-related sales, the firm's diagnostic revenues rose 5 percent.
Within diagnostics, molecular diagnostics revenues totaled $521 million in 2024, down 9 percent from $574 million in 2023, and core laboratory revenues were $5.24 billion, up nearly 2 percent from $5.16 billion in 2023. Point-of-care revenues were $588 million, a 4 percent increase from $565 million a year ago, and rapid diagnostics revenues were $3.0 billion, down 19 percent from $3.69 billion in 2023.
Global COVID-19 testing sales for the year were $747 million, down from $1.59 billion in 2023. Excluding COVID-19 testing-related sales, molecular revenues declined 3 percent, core laboratory revenues rose 6 percent, point-of-care revenues were up 4 percent, and rapid diagnostics revenues grew 6 percent year over year, all on an organic basis.
Regarding its other business units, 2024 nutrition revenues rose 3 percent year over year to $8.41 billion from $8.15 billion; established pharmaceuticals revenues increased nearly 3 percent to $5.19 billion from $5.07 billion; and medical devices revenues rose 12 percent to $18.99 billion from $16.89 billion.
The company reported a 2024 net income of $13.40 billion, or $7.64 per share, compared to $5.72 billion, or $3.26 per share, in 2023. The firm's 2024 adjusted EPS was $4.67 per share, meeting the consensus Wall Street estimate.
Regarding potential M&A, Ford said that there has been an "uptick of activity" and that there are some "good opportunities out there," but noted that Abbott has a strong organic pipeline that allows it to be selective about any deals. While the company has about $1.5 billion in debt to pay down in 2025, he said that Abbott is "in a great position with our balance sheet to be able to leverage opportunities," particularly in medical devices and diagnostics.
The firm's balance sheet will "provide us a lot of strategic flexibility," he added.
For Q1 2025, Abbott is forecasting adjusted EPS to be between $1.05 and $1.09.
Abbott is projecting full -year organic sales growth of between 7.5 percent and 8.5 percent in 2025. Adjusted EPS growth is expected to be between $5.05 and $5.25.
In morning trading on the New York Stock Exchange, Abbott's stock was up 2 percent at $118.88.