AMSTERDAM (Reuters) – Dutch health technology company Philips raised its full-year outlook on Monday, surpassing analysts’ expectations for third-quarter core profit and comparable sales.
With core profit more than doubling to 457 million euros ($483.3 million) and comparable sales increasing by 11% to 4.5 billion euros, the company experienced a surge in demand for its medical scanners, patient monitoring equipment, and personal health devices.
However, new orders witnessed a 9% decline compared to the previous year, primarily due to a cooling demand from China following a pre-pandemic boom and ongoing supply chain challenges.
During an interview with Reuters last week, CEO Roy Jakobs emphasized Philips’ plan to localize production for the Chinese market and procure chips from multiple suppliers as strategies to address escalating trade tensions.
Despite the decrease in orders, Philips now anticipates a 6% to 7% growth in comparable sales by 2023, with an adjusted EBITA profit margin of 10%-11%.
The company’s earlier guidance projected mid-single digit sales growth with a high single-digit profit margin.
In a poll conducted by the company, analysts predicted that adjusted July-September earnings before interest, taxes, and amortization would rise to 389 million euros, up from 209 million euros the previous year, accompanied by an 8% increase in comparable sales.
($1 = 0.9456 euros)
(Reporting by Bart Meijer; Editing by Jacqueline Wong and Varun H K)
