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Abbott Diagnostics Q1 Revenues Down 18 Percent, Total Revenues up 2 Percent

Note: This story has been updated with comments from the conference call discussing the firm's financial results.

NEW YORK — Abbott on Wednesday announced that its Q1 2024 Diagnostics revenues declined 18 percent year over year as a result of declining COVID-19 testing sales. 

For the three months ended March 31, Abbott reported overall Q1 revenues of $9.96 billion, up 2 percent from $9.75 billion in Q1 2023 and beating analysts' average estimate of $9.88 billion. 

On an organic basis excluding COVID-19 testing, revenues rose 11 percent year over year, the Abbott Park, Illinois-based firm said. 

Abbott Chairman and CEO Robert Ford said on a conference call to discuss the firm's financial results that the firm is "off to a very good start to the year" and that it is seeing "strong returns from the investments we're making across our growth platforms." The company's pipeline is "highly productive," and Abbott is "very well-positioned to continue to deliver strong results for the remainder of the year," he added. 

The firm reported its Diagnostics segment revenues fell 18 percent to $2.21 billion from $2.69 billion a year ago. Within Diagnostics, core laboratory revenues were up 2 percent year over year to $1.21 billion from $1.18 billion. Meanwhile, its molecular diagnostics revenues fell 12 percent to $129 million from $147 million in Q1 2023. Point-of-care revenues were up 4 percent to $139 million from $134 million, and rapid diagnostic revenues fell 40 percent to $741 million from $1.23 billion. 

COVID-19 testing sales were $204 million for the quarter, down from $730 million in Q1 2023. 

Excluding COVID-19 testing-related sales, Abbott's Diagnostics segment posted year -over-year revenue growth of 3 percent on a reported basis and organic revenue growth of 5 percent. Organically, core laboratory revenues increased 6 percent year over year, molecular diagnostics revenues fell 1 percent, point-of-care revenues increased 4 percent, and rapid diagnostics revenues rose 6 percent. 

Ford said that the diagnostics business "continues to have a great track record here of outperforming the market" and that it has seen "large account wins" in both the US and internationally. 

Excluding the COVID testing business, growth in the business has been led "by the adoption of our market-leading systems and demand for testing that takes place in a variety of settings, including hospitals, laboratories, urgent care centers, physician offices, retail pharmacies, and blood screening facilities," Ford said. The company is also focused on developing new diagnostic systems and creating new tests that "play an important role in making healthcare decisions, expand the accessibility of testing, and deliver a result as fast as possible," he added. 

Ford specifically touted the launch of Abbott's test for traumatic brain injuries that received FDA 510(k) clearance earlier this month. That test will allow concussion testing to move into urgent care centers, physicians' offices, and other settings closer to the patient, and also has the "potential to transform the standard of care for concussion testing," he said. 

He also teased a new platform in development by the firm — a molecular Alinity system that "will target a segment of the market that we currently don't participate in." 

Among its other business segments, Abbott's Q1 Nutrition revenues rose 5 percent to $2.07 billion from $1.97 billion; Established Pharmaceuticals revenues increased 3 percent to $1.23 billion from $1.19 billion; and Medical Devices revenues rose 14 percent to $4.45 billion from $3.90 billion. 

All four segments of the business are "super well aligned to the global demographics and trends in healthcare," Ford said, though there are "always opportunities to add" to the business. 

"We've shown that if there are areas that we feel that we can bring value in a combination, then we've got a strong balance sheet and strategic flexibility to do that." 

Abbott reported net earnings of $1.23 billion, or $.70 per share, in Q1 compared to $1.32 billion, or $.75 per share, in the year-ago period. Adjusted EPS was $.98, beating the analysts' consensus estimate of $.95. 

Abbott narrowed its full-year 2024 EPS guidance range and projecting full-year 2024 EPS from continuing operations of between $3.25 and $3.40. Adjusted EPS from continuing operations for the year is anticipated to be between $4.55 and $4.70. Q2 2024 EPS is expected to be between $.69 and $.73, with adjusted EPS between $1.08 and $1.12. 

In January, the company forecast 2024 EPS of $3.20 to $3.40 and adjusted EPS of $4.50 to $4.70. 

On the call, Ford equated narrowing the EPS range with raising its guidance from the earlier projection. He noted that the last time the company raised its full-year guidance in the first quarter of the year was in 2016 and said the firm "felt comfortable" doing it now even though it's "something that we don't usually do" because the performance of the business "continues to be very, very strong" and a lot of the company's businesses are "accelerating in performance." The firm continues to "believe going into the second quarter … that there's probably more opportunities than risks." 

The firm also narrowed its full-year 2024 organic sales growth guidance range to between 8.5 percent and 10 percent, representing an increase at the midpoint of the range. 

In Wednesday afternoon trading on the New York Stock Exchange, shares of Abbott were down 3 percent to $106.11.