Abbott cuts profit forecast in wake of cancer-screening deal

[NEW YORK] Abbott Laboratories cut its yearly profit guidance, after the company adjusted for the impact of a US$21 billion deal in 2025 for a cancer-screening company that was meant to boost its weakening diagnostics business.

The device and nutrition company now expects full-year adjusted earnings of US$5.38 to US$5.58 a share, it said on Thursday (Apr 16).

This is lower than its previous forecast of US$5.55 to US$5.80 a share. It still projects full-year 2026 comparable sales growth of 6.5 to 7.5 per cent.

Shares of Abbott fell 3.8 per cent at 7.45 am in New York on Thursday, before the start of regular trading. They have lost 19 per cent of their value in the year to Wednesday. 

The company’s diagnostics business has been suffering in the wake of the Covid-19 pandemic as demand for testing dwindled.

It has looked to deals to revive sales. In November 2025, it agreed to acquire cancer-screening company Exact Sciences in a deal with a total equity value of about US$21 billion. 

The transaction is expected to boost Abbott’s diagnostics business, giving it access to tests such as Cologuard for colorectal cancer – the leading cause of cancer deaths in the US.

Diagnostics sales in the first quarter were US$2.18 billion, against estimates of US$2.11 billion.

Abbott’s overall adjusted earnings for the quarter came in at US$1.15 a share, matching the average analyst estimate. Sales were US$11.2 billion, slightly ahead of Wall Street estimates.

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Nutrition sales were US$2.02 billion against estimates of US$2 billion. The business, which includes baby formula and adult products such as protein drinks, has faced pressure in recent quarters as the company adjusted pricing and promotions to appeal to more cost-conscious consumers.

Abbott has said that it plans to launch six new nutrition products in 2026 to help drive growth. 

Separately, its nutrition unit has been mired in controversy following lawsuits alleging that its baby formula can cause necrotising enterocolitis (NEC), a serious bowel ailment that affects premature babies.

In April, a jury ordered Abbott to pay US$70 million over claims by four mothers that the company hid the fact that its premature formula can cause NEC.

The company said that it disagreed with the verdict and planned to appeal, adding that similar lawsuits have been dismissed in other courts.

Sales of adult products in the nutrition unit, which include protein-focused drinks for people on weight-loss drugs, have been growing in recent quarters.

Medical device sales, Abbott’s largest business unit, totalled US$5.54 billion, slightly above estimates of US$5.49 billion. The division sells tools that help diabetics monitor blood sugar, such as continuous glucose monitors, and has been a key growth driver. BLOOMBERG