GE HealthCare Q4 Revenue Up 7.1% with EPS Beat, 2026 Forecast $4.95–$5.15
GE HealthCare reported Q4 adjusted EPS of $1.44, beating the $1.40 consensus, on revenues of $5.69 billion, up 7.1% year-over-year including 4.8% organic growth. Net income margin fell 320 basis points to 10.3%, and the company forecasts 2026 adjusted EPS of $4.95–$5.15 with lower tariff impacts.
1. Q4 2025 Results Exceed Street Expectations
In the fourth quarter of 2025, GE HealthCare delivered revenue of $5.70 billion, up 7.1% year-over-year and surpassing consensus forecasts by $90 million. Adjusted earnings per share were $1.44, outperforming analyst estimates by $0.04. Organic revenue growth stood at 4.8%, driven by robust capital investment trends in key markets including the U.S. and EMEA. Total orders climbed 2.0% organically, and the company achieved a book-to-bill ratio of 1.06, reflecting strong demand across its portfolio of diagnostic and imaging solutions.
2. Segment Performance and Growth Drivers
GE HealthCare’s Pharmaceutical Diagnostics unit led all segments, with sales rising 22.3% to $790 million and organic growth of 12.7%, fueled by new immunoassay product launches. Imaging revenues increased 6.6% to $2.55 billion (5.3% organically) on sustained hospital upgrade cycles, while Advanced Visualization Solutions grew 5.9% to $1.53 billion (4.2% organically) as cloud-first analytics deployments gained traction. Patient Care Solutions remained stable at $825 million, reflecting continued demand for monitoring equipment despite a challenging competitive landscape.
3. Margin Headwinds from Tariffs and Mix
Net income margin declined by 320 basis points to 10.3%, and adjusted EBIT margin contracted by 200 basis points to 16.7%. Management attributed the margin compression to $75 million of incremental tariff costs on imported components and an unfavorable product mix shift toward lower-margin service contracts. These impacts were partially offset by volume growth and disciplined pricing actions. Free cash flow for the quarter reached $916 million, up $105 million year-over-year, supporting ongoing reinvestment and shareholder returns.
4. 2026 Outlook and Valuation Appeal
GE HealthCare forecasts adjusted earnings per share in the range of $4.95 to $5.15 for fiscal 2026, implying 7.9% to 12.3% growth year-over-year. The company expects tariff headwinds to ease relative to 2025 and aims for 3.0%–4.0% organic revenue growth. With a record backlog and planned acquisitions such as Intelerad enhancing its cloud-enabled imaging platform, management remains confident in delivering mid-teens EBIT margins. At current valuation multiples, shares trade below peer averages on an enterprise value-to-EBITDA basis, supporting a 'buy' recommendation while upside catalysts include service-attach rate expansion and accelerated digital adoption.