Abbott (NYSE: ABT) published its Q3 2023 financial results this week, reporting a 8.7% year-on-year (YOY) decline in global sales on an organic basis to USD 29.9 billion over the first three quarters. The decrease was primarily attributed to significantly reduced demand for SARS-CoV-2 tests, which led to a 42.1% YOY drop in the diagnostics business to USD 7.5 billion.
Performance Across Segments
Despite the downturn in diagnostics, other segments of Abbott’s business showed robust growth. The areas of established pharmaceuticals, nutrition, and medical devices reported expansions of 11.6%, 12.7%, and 13.8% respectively, reaching USD 3.8 billion, USD 6.1 billion, and USD 12.4 billion in sales.
Geographic Sales Analysis
Geographically, sales in the US fell 17.4% YOY to USD 11.5 billion, while international markets experienced a 6.5% decline to USD 18.4 billion. During the earnings call, CEO Robert Ford highlighted that annual sales in the China market are approximately USD 1 billion, with the medical devices business growing 20% during Q3.
Impact of China’s Policies
Ford also addressed China’s recent anti-corruption initiatives, stating they are not expected to significantly impact the company. He acknowledged that China’s volume-based procurement (VBP) process has affected pricing but noted that it has had a net positive effect on Abbott’s established pharmaceuticals sector due to increased market share and sales volume.-Fineline Info & Tech
