Solid Results Undermined by Unchanged 2025 Forecast
Abbott Laboratories saw its shares fall by 8.1% in Thursday’s afternoon session after the healthcare device and product giant reported second-quarter earnings that slightly beat expectations but failed to raise its full-year guidance. Investors appeared disappointed that the company maintained its adjusted EPS forecast for 2025 between $5.10 and $5.20 despite delivering a solid quarter.
For Q2, Abbott posted adjusted earnings of $1.26 per share on revenue of $11.14 billion, surpassing analysts’ estimates of $1.25 EPS and $11.07 billion in revenue. The Medical Devices segment was the standout performer, reporting 13.4% growth, particularly driven by strong sales of the FreeStyle Libre glucose monitoring system within its Diabetes Care division.
Market Reacts to Guidance, Not Results
While Abbott’s 7.5% organic sales growth across its base business was impressive, the company’s decision to keep full-year projections flat led to the market’s sharp reaction. Analysts noted that investors had been hoping for a more bullish outlook following the strong Q2 performance, making the lack of guidance upgrade a potential signal of caution.
The company has a track record of stability, with only one prior stock move exceeding 5% over the past year. Thursday’s drop therefore reflects a shift in sentiment, even though the underlying fundamentals remain strong. Abbott’s ability to drive consistent organic growth while navigating post-COVID diagnostic challenges supports its long-term positioning.
Previous Gains and Broader Context
Earlier in the year, Abbott shares gained 5.4% after Q1 earnings modestly exceeded expectations, with flat guidance helping to reassure investors amid macroeconomic uncertainty. During that quarter, the Medical Devices segment saw 12.6% organic growth, bolstered by demand for diabetes and cardiovascular technologies. However, the Diagnostics division dragged on performance due to a continued decline in COVID-19 test sales.
Overall, Abbott’s steady earnings, strong performance in key growth areas, and consistency in guidance reflect a cautious but stable approach in an unpredictable environment. For long-term investors, these short-term dips could present attractive entry points, particularly as the company continues to focus on innovation and market leadership in medical devices.
Valuation and Stock Performance
Abbott shares are up 6.2% year-to-date but remain 14.1% below their 52-week high of $140.22 reached in March 2025. As of now, the stock is trading at $120.48 per share. Investors who purchased $1,000 in Abbott shares five years ago would currently hold approximately $1,214 in value, underlining its reputation as a stable, long-term growth stock.
With solid fundamentals, improving demand in core segments, and a reliable track record, Abbott may still appeal to value investors — even if short-term sentiment remains cautious.