Abbott Laboratories (ABT.US) Q1 profit slightly exceeds expectations, plans to expand US factory to address tariff challenges.

Abbott Laboratories (ABT.US) announced on Wednesday that its first-quarter sales were $10.4 billion, meeting market expectations. Medical device sales were $4.9 billion, slightly higher than the market expectation of $4.85 billion. Adjusted earnings per share were $1.09, slightly higher than the market expectation of $1.07. Amidst the tariff uncertainties in the healthcare industry, Abbott Laboratories plans to expand its manufacturing operations in the United States. In a statement on Wednesday, Abbott Laboratories stated that it plans to invest $500 million in two factories in Illinois and Texas. A spokesperson said that these investments will be used to expand existing factories and promote research and development in the United States. The company will hire up to 200 people in Illinois and up to 100 people in Texas to support this work. Abbott Laboratories also reiterated its previous annual performance guidance. The company still expects adjusted full-year earnings per share to be between $5.05 and $5.25. Due to the uncertainty surrounding the impact of comprehensive new tariffs, Wall Street has been closely monitoring changes in the company's profit expectations. Multinational healthcare companies like Abbott Laboratories have manufacturing facilities worldwide. While pharmaceutical products are not affected by the tariffs announced earlier this month in the United States, medical devices will still be subject to specific national tariffs, despite President Trump's announcement of a partial postponement of reciprocal tariffs. By 2024, approximately 45% of Abbott Laboratories' revenue will come from medical devices. The company opened a new factory in Ireland last year to produce sensors for glucose monitoring products. At the time, the company stated that the factory would be the "highest-volume manufacturing facility of its kind globally." Abbott Laboratories stated, "Ireland plays a critical role in helping Abbott Laboratories achieve its goals, with 10 factories across four provinces supporting our work in diagnostics, medical devices, and nutrition fields." Industry organizations including AdvaMed are urging U.S. Trade Representative Jamieson Greer to exempt medical devices from tariffs, citing concerns about costs and disruptions in the supply chain. AdvaMed and nine other organizations expressed in a letter to Greer on April 1st, "We are concerned that imposing tariffs on medical and dental equipment could disrupt supply chains and increase costs for these critical products. This will ultimately add further financial pressure to healthcare providers, hospitals, and health systems, especially those in rural and underserved areas." Johnson & Johnson's Chief Financial Officer Joseph Wolk stated on a call with investors on Tuesday that they anticipate tariff expenditures of $400 million by 2025, primarily due to the impact of retaliatory tariffs on their medical device business. Approximately 61% of Abbott Laboratories' sales come from markets outside the United States. As of the time of writing, Abbott Laboratories' stock price increased by 0.75% in pre-market trading.