Abbott Laboratories reported quarterly revenue of $10.7 billion, falling short of the consensus estimate of $11.8 billion. The underperformance was driven by a 28% year-over-year decline in its diagnostics business, which had benefited from elevated COVID-19 testing volumes in prior periods. With COVID-19 testing demand plunging more than 70% sequentially in North America and the U.S. government freezing foreign aid for pandemic testing, Abbott’s diagnostics sales contracted by approximately $1.5 billion versus the year-ago quarter. Management noted that non-COVID diagnostic lines, including its hematology and immunoassay portfolios, grew mid-single digits but were insufficient to offset the sharp drop in pandemic-related testing revenue.

In the fourth quarter, Abbott reported adjusted EPS of $1.49, up from $1.34 in the same period last year, driven by strong performance in its diabetes care and structural heart segments. FreeStyle Libre continuous glucose monitoring systems saw global unit growth of 32%, while structural heart sales rose 14% on continued uptake of MitraClip procedures. The company’s board approved a 5% dividend increase, extending its dividend growth streak to 50 consecutive years. With a current dividend yield of 2.0% and a payout ratio of roughly 35% of adjusted earnings, Abbott maintains a solid cash flow profile, supported by $4.2 billion in operating cash flow during the quarter and $12.8 billion in cash and marketable securities on the balance sheet.

Abbott received CE Mark clearance in Europe for its TactiFlex™ Duo Ablation Catheter, a dual-energy device that delivers both radiofrequency and pulsed field ablation (PFA) for the treatment of atrial fibrillation. The approval follows the company’s Volt PFA System clearances last year and is supported by data from the global FOCALFLEX clinical trial, which demonstrated a 94% acute success rate and a 1.8% serious adverse event rate in paroxysmal AFib patients. Management expects the new catheter to contribute to mid-teens electrophysiology revenue growth in 2026, as Abbott continues enrollment in its U.S. FLEXPULSE IDE pivotal study and pursues FDA approval for ventricular tachycardia applications.