Abbott Earnings Beat Forecasts. Why the Stock Is Having Its Worst Day Since 2021.

Abbott Laboratories reported second-quarter sales that beat analysts’ expectations. (Bing Guan/Bloomberg)

Abbott Laboratories stock tumbled Thursday after the maker of medical devices and nutrition products narrowed its full-year guidance range.

Adjusted earnings of $1.26 a share narrowly the topped the $1.25 analysts had projected, according to FactSet. Sales of $11.14 billion topped the $11.06 billion Wall Street had anticipated. The figure represented an increase from $10.36 billion sequentially and $10.38 billion last year.

At the time of its first-quarter report in April, the company guided for full-year adjusted earnings in the range of $5.05 to $5.25 a share. Management tightened that range to $5.10 to $5.20 a share. Analysts polled by FactSet were expecting $5.10 a share.

The company said it expects organic sales, excluding those related to Covid-19 testing, to grow 7.5% to 8%. Including testing, it anticipates an increase of between 6% and 7%.

CEO and Chairman Robert Ford lauded the company’s “high single-digit organic sales growth” in the quarter, noting Abbott had expanded its margin profiles and nudged key programs along through its product pipeline. “We see this momentum carrying into 2026,” Ford said.

Shares sank 7.2% to $122.24, heading for the worst same-day percentage decrease since a 9.3% drop in June 2021, according to Dow Jones Market Data. The benchmark S&P 500 was up 0.4%.

“Our goal is to always ensure that every one of our businesses is meeting and beating, right?” Ford said on the earnings call. “The reality is…you’re going to have some businesses that will fall short time to time and others do better.”

In addition to a drop-off in Covid testing sales, the company’s Core Laboratory diagnostics business has faced challenges in the Chinese market. Ford indicated these headwinds had been rolled into the updated guidance.

“We had expected a market volume recovery to start happening in — quite frankly, starting in Q2,” the CEO explained. “We haven’t seen that. So we’ve moved that out into Q4.”

The company is also expected to take a $200 million hit from tariffs, and remains focused on absorbing that impact, Ford said.

“We’ve got a very strong manufacturing network around the world, around 90 manufacturing sites. We’re going to build another cardiovascular manufacturing site here in the U.S.,” the CEO continued. “So, we’re thinking about it once tariffs get set in place — they’re very difficult to walk away from. We have to think medium-term, but also long-term.”

Corrections & Amplifications:

Abbott Laboratories reported second-quarter adjusted earnings of $1.26 a share, beating analysts’ estimates of $1.25. An earlier version of this article incorrectly said Abbott missed expectations of $1.30 a share.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com