Abbott's Earnings: A Dose of Optimism and Growth

By your favorite finance writer, channeling Matt Levine

July 17, 2025

Breaking Down the Numbers

Abbott Laboratories (NYSE: ABT) has just released its second-quarter earnings report, and the numbers are more than just a shot in the arm for investors. The company reported a 7.4% growth in sales, with organic growth coming in at 6.9%. If you exclude the COVID-19 testing-related sales, that growth bumps up to 7.5%. Not too shabby for a company that has been riding the pandemic wave for a while now.

In terms of earnings, Abbott's GAAP diluted EPS stood at $1.01, while the adjusted diluted EPS came in at $1.26. If you’re keeping score at home, that’s a solid earnings surprise compared to the EPS consensus expectations. Double-digit growth is always a crowd-pleaser, especially when it feels like every other company is just trying to keep the lights on.

Margins and Forecasts: A Healthier Outlook

Abbott's reported gross margin was 52.7% of sales, with the adjusted figure at 57.0%, reflecting a 100 basis point increase. This is the kind of margin expansion that can make even the most jaded investor crack a smile. The operating margin followed suit, coming in at 18.4% reported and 22.9% adjusted, again showing a 100 basis point improvement. If margins are the lifeblood of a company, Abbott is pumping iron.

Looking ahead, Abbott has projected full-year 2025 organic sales growth to be between 7.5% and 8.0%, or 6.0% to 7.0% when including those pesky COVID-related sales. The company also forecasts an adjusted diluted EPS between $5.10 and $5.20. This optimism is not just a shot in the dark; it’s based on solid performance and strategic growth initiatives.

What This Means for Abbott and Its Peers

Abbott's strong performance has implications beyond its own balance sheet. As a major player in the healthcare sector, Abbott's success could signal a broader recovery for companies in this space. With competitors likely feeling the pressure to keep up, we might see some interesting maneuvers in the coming quarters as they attempt to match Abbott’s growth trajectory.

Additionally, Abbott’s enrollment completion in its FlexPulse U.S. IDE trial and the positive data from the AVEIR Conduction System Pacing study suggest that the company is not just resting on its laurels. They are actively investing in innovation, which is a crucial element in maintaining a competitive edge. It’s a reminder that in the world of healthcare, staying ahead often means staying active.