Abbott Laboratories ABT-N cut its full-year profit forecast on Thursday due to a 20 U.S. cent-per-share hit from its recent US$23-billion acquisition of cancer test maker Exact Sciences, sending its shares down more than 4 per cent premarket.
The medical device maker now expects adjusted profit per share between US$5.38 and US$5.58 for 2026, compared with its previous forecast of US$5.55 to US$5.80 per share.
Despite the hit, CEO Robert Ford said the acquisition adds another high-growth business to the company’s portfolio.
That contribution was evident in first-quarter results, where growth in cancer diagnostics and continued strength in medical device demand helped Abbott post a modest beat on both earnings and revenue.
The deal, one of Abbott’s largest acquisitions, is a major push into the fast-growing cancer diagnostics market. It gives the company access to Exact’s flagship colorectal cancer test Cologuard and early-stage breast cancer test Oncotype DX, helping offset revenue declines from its COVID-19 testing kits.
The company said the first-quarter results “aligned with our expectations to start the year.”
On an adjusted basis, the company reported profit per share of US$1.15, compared with analysts’ estimate of US$1.14, according to data compiled by LSEG. Total revenue was US$11.16-billion, compared with expectations of US$11-billion.
Abbott and rival continuous glucose monitor (CGM) makers such as Dexcom and Medtronic are riding a surge in demand as diabetes awareness rises, insurance coverage expands, and patients embrace finger-prick-free technology.
Quarterly sales in Abbott’s medical devices segment grew 13.2 per cent to US$5.54 billion, beating estimates of US$5.29-billion, driven by demand for diabetes devices. Sales of its continuous glucose monitors grew 14.2 per cent.
Sales in its diagnostics segment grew 6.1 per cent to US$2.18 billion, slightly beating the estimate of US$2.1 billion.
Abbott expects second-quarter adjusted earnings per share of US$1.25 to US$1.31, compared with estimates of US$1.37 per share.