Archive photo: Chicago skyline. Bruno Storchi Bergmann/Pexels (cropped)
GE HealthCare raised its full-year earnings outlook Wednesday after third-quarter revenue increased 7.2% and net income rose to $615 million, with growth across its medical-imaging, pharmaceutical-diagnostics and patient-care businesses.
The company now expects 2026 adjusted earnings of $4.95-$5.05 a share, up from $4.80-$5.00. It also raised the bottom of its adjusted operating-margin range and expects organic revenue growth of about 4%, compared with a previous range of 3-4%, according to its third-quarter results release.
Profit grows faster than revenue
Third-quarter revenue was about $5.5 billion, up 7.2%, including 6.2% organic growth. Net income attributable to GE HealthCare increased to $615 million from $446 million a year earlier. Diluted earnings per share rose to $1.36 from $0.98 under U.S. generally accepted accounting principles.
Adjusted earnings per share increased to $1.34 from $1.07. Adjusted earnings before interest and taxes reached $913 million, compared with $761 million, and the adjusted EBIT margin increased to 16.6% from 14.8%.
Adjusted earnings, adjusted EBIT, organic growth and free cash flow are non-GAAP financial measures. The company attributed margin gains to sales volume, pricing, productivity and a favorable year-over-year net tariff effect, partly offset by inflation.
Higher forecast and cash generation
GE HealthCare now expects an adjusted EBIT margin of 15.5-15.7% for the full year, compared with 15.4-15.7% previously. It forecasts free cash flow of more than $1.6 billion, compared with about $1.6 billion previously.
Cash flow from operating activities was $907 million in the quarter, while free cash flow was $793 million. Both figures included a $55 million tariff refund.
The company said its forward-looking non-GAAP measures could not be reconciled to GAAP without unreasonable effort because certain items could not be forecast with reasonable certainty.
Orders and backlog expand
Organic orders increased 4%, and the company reported a backlog of $23.7 billion. Its book-to-bill ratio was 1.03, meaning orders were slightly higher than revenue during the period.
Advanced Imaging Solutions revenue increased 6.1% to $3.873 billion. Pharmaceutical Diagnostics revenue rose 13% to $846 million, while Patient Care Solutions revenue grew 8.5% to $793 million.
Chief Executive Peter Arduini said the company’s commercial execution and customer adoption of new products supported the results. “With our improved performance year-to-date and momentum in the business, we are raising guidance for the year,” he said.
JBizNews Desk | Chicago
© JBizNews.com. All rights reserved. Unauthorized reproduction or redistribution is strictly prohibited.
