GE HealthCare beat Wall Street estimates for its second-quarter profit, driven by robust demand for diagnostic and imaging devices and refunds of tariffs imposed under US President Donald Trump. The company reported quarterly adjusted earnings per share of $1.13, surpassing the analysts' average estimate of $1.04, according to LSEG data.
GE HealthCare quarterly net income, up from $486 million last year.
Revenue for the three months ending June 30 reached $5.30 billion, exceeding an estimated $5.26 billion. Within its segments, sales grew 7.9% in imaging devices and 15.6% in pharmaceutical diagnostics. The net income increase was supported by $129 million in tariff refunds. These refunds follow court rulings finding that duties imposed by Trump last year were collected illegally and must be repaid, prompting companies to seek recovery of paid tariffs.
GE HealthCare shares rose 12% in premarket trading. The company previously maintained its annual profit forecast and provided preliminary second-quarter results earlier this month.
Margin pressures and geopolitical impact
Despite the profit beat, GE HealthCare stated its adjusted core margin was 40 basis points lower than a year ago. The company attributed this to inflation in freight, oil, and memory chip costs.
Global geopolitical instability, including the conflict in the Middle East, adversely impacted our costs, supply
Sector performance contrasts
The results occurred alongside mixed signals in the healthcare sector. While Abbott and Intuitive Surgical also beat second-quarter estimates and Johnson & Johnson did not flag weakness in procedure volumes, HCA Healthcare warned earlier this month about rising numbers of uninsured patients and softer demand for surgical procedures. This follows the expiration of pandemic-era subsidies, which many Americans report has led to people dropping off Affordable Care Act plans.