Abbott Laboratories (ABT) 17 Jul 192019 Q2 Earnings call transcript

Company Profile

Participants

Scott Leinenweber	VP, IR, Licensing and Acquisitions
Miles White	Chairman and CEO
Robert Ford	President and COO
Brian Yoor	EVP, Finance and CFO
David Lewis	Morgan Stanley
Robbie Marcus	JP Morgan
Bob Hopkins	Bank of America
Kristen Stewart	Barclays
Joanne Wuensch	BMO Capital Markets
Matthew Taylor	UBS

Call transcript

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Operator

Good morning and thank you for standing by. Welcome to Abbott’s Second Quarter 2019 Earnings Conference Call. All participants will be able to listen only until the question-and-answer portion of this call. [Operator Instructions] This call is being recorded by Abbott.

With the exception of any participant’s questions asked during the question-and-answer session, the entire call including the question-and-answer session is material copyrighted by Abbott. or Abbott’s recorded written be cannot rebroadcast express without permission. It

Mr. now Acquisitions. Vice like would Scott to and I Licensing introduce Leinenweber, Relations, President, Investor

Scott Leinenweber

performance morning will Brian Executive Officer. opening Officer; outlook me detail. Ford, us. Chief and President Chairman for Financial Operating thank Miles discuss Vice Robert the are remarks Officer; President, Chief and and of Chief Miles provide White, Executive more and Good With and Board our and and Yoor, Brian you will in today joining Finance

their questions. Following comments, we’ll take your

subject be those we for Litigation that uncertainties some Before indicated including for forward-looking from started, statements actual to get cause of may statements. are cautions Act of made the to in Securities the today Private risks Abbott differ may financial forward-looking materially results these XXXX. forward-looking and the expected the results XXXX, purposes that Reform statements

other are annual XA, may the as governmental, law. that affect obligation except statements XX, technological competitive, year on ended Securities operations of any report result Factors events developments, and Risk subsequent Form and publicly undertakes to Exchange revisions December Abbott’s XX-K Economic, to no Abbott Commission a forward-looking required Item for factors to as in XXXX. or discussed release our by

conference understand items These organic regulatory on non-GAAP from today’s earnings issued to growth, help comparable Please our note which defined release at On used GAAP Unless our our today, on P&L otherwise and refers news line business financial with in is which reconciled Abbott’s financial release measures financial are to news available growth the of in sales for for today. and operations measures quarter ongoing measures commentary performance. earnings abbott.com. guidance earlier results sales noted, only. website the are provided our that in filings and today be will second as EPS on the investors the non-GAAP will sales, call continuing call, be past, financial

that, With over call turn now will I the to Miles.

Miles White

you, Good Thank morning. Scott.

quarter of results earnings Sales of in reflecting pleased I'm businesses achieve these our reported an share double-digit ongoing types all with previous another with per on with our Today, expectations. quarter X.X% four above basis we organic increased strong particularly ability to exceeding the guidance range strong growth. and of $X.XX, results. consistently

the has averaged than forward. X%. Over of organic going positioned growth importantly, pipeline our type growth this our And product we're years, past two and portfolio strong sales quarterly with new well for more

half the our exchange. even the Based at on faster impact a share adjusted our first of nearly reflecting we the reported growth foreign basis, the raising on full-year midpoint year, outlook to we're now performance forecast of of growth and and XX% excluding in momentum per $X.XX $X.XX, when and earnings

to areas several just well. areas across growth broad-based a I'd portfolio, achieved we perform like exceptionally we where few While highlight our of continue to

the I'll devices by business of in quarter. base, of where $XXX with and we achieved user to medical organic start continued global as significantly more than add million Libre, to reflected growth our our sales FreeStyle XX% sales

where continued insurance. progress pharmacy now excellent the in also for We reimbursed reimbursement to XX% private benefit people U.S. Libre make access with and of expanding approximately is

benefits reimbursement cost pocket that value unique by coverage recognize are It Payers and lower to of value out design. even provides priced providing patients. for further helps clinical a offers which proposition for Libre it affordability. Libre, that’s great we ensure and and increasingly

to been meet significantly demand. As expand capacity I’ve to manufacturing mentioned for before, we’ve Libre investing our

needs a diabetes Libre will expansion incremental all massive in of accessible that of managing broadly make the months of next wave population their is our them. to that. come to first online help that intent after capacity followed of by and couple There’s The cadence

MitraClip, by we the quarter. where business was in where more indication. of mitral led the device for XX% new market the regurgitation, than our which we XX% U.S. And Heart Structural our grew growth global treatment to expanded more had mid-teens recently received This sales leading MitraClip Turning of the achieved than growth. in

week, MitraClip this device, generation Earlier U.S. options we new builds with disease. of approval the our features sizes, platform announced providing leading clip this treating fourth on when physicians enhanced further and which

reduce stroke left of to of replace first device We’ve Cephea, a leaky technologies heart Tendyne valves. been with faulty have for more a which tricuspid appendage Structural risk devices Amulet, pipeline Heart repair than are its including and heart a atrial patients kind of deep in of of Amplatzer building minimally the our our and TriClip, development the for device position and in fibrillation. valve, and decade invasive atrial a to mitral

years With years, our Structural the Heart growth a targeting that well to pipeline in underpenetrated as technologies as for positioned growth of several over highly steady market of areas come. launch rapid MitraClip a adoption is the for we’ll new next strong, well business

rollout remain global our instruments where which for the diagnostics area of of we diagnostics, suite on Next compete. every focused in of Alinity we

immunoassay helping growth making chemistry progress drive the Europe our international in launch Core to where with our testing systems double-digit of in clinical We’re and great Laboratory for business. Alinity is

in in now also of We’re for instruments launching hematology stages early and testing Alinity Europe. the molecular

undertaking amount our an be sustainable, while is going forward. smaller for that faster Alinity strong blood highest blood FDA we’re menu approvals S system global And more approval world’s of business U.S., the steady core space announced a broad regulatory and the growth Alinity plasma for maintaining majority Abbott last tests. supply. this efficient within our week, to levels diagnostics just we is The And of the designed positions making of screens of and the accuracy. for of screening. In laboratory of achieving ambitious progress, rollout

summary, So, the of in in expectations exceeded all our four businesses quarter.

was it’s outlook by Our a the and what ourselves already growth forecast our to growth attractive in most year. it’s is healthcare, and are positioned results. of key sustainable. areas impressive today, of And strong, we’re strategically for adding delivering We’ve some growth strong our the platforms accelerating raising

call turn our discuss to for I’ll detail. outlook results over year the the more to in Brian now Brian? and

Brian Yoor

Thanks, Miles.

otherwise rates consistent unless are with As that to organic please earlier, guidance. growth is an noted Scott references mentioned previous our which sales on note basis, all

results. our Heart Medical X.X%. Diabetes Electrophysiology, the grew with second Structural Devices growth to Sales Heart XX.X% Failure, Sales quarter in in Turning Care. double-digit and for increased

In Diagnostics. growth our Point nutrition, diagnostics, Diagnostics increased increased high X.X% in X.X%, And in sales and grew sales Established led growth emerging Nutrition. Sales sequential Core by in in improvements strong markets. by Laboratory and Rapid of X.X% X% led single-digit in Care Pharmaceuticals growth in Adult with key

total of in our X.X%, the unfavorable April. expectations time earnings at impact of our Exchange on which X.X% more unfavorable call had Abbott sales an was to approximately

adjusted Regarding aspects was expense X.X% sales, adjusted adjusted XX.X% the R&D the of other P&L, gross of was sales ratio and investment of sales. XX.X% was SG&A margin of

to The implementation tax entirely adjusted adaptation of due and XX.X%, reform to XX%, U.S. second rate regulations. lower was than quarter around continued previous tax of our guidance the full-year

rate Our with first revised second of rate reflects tax our full-year quarter forecast XXXX our the rate of effective tax for aggregate the align to half tax adjustment XX.X%.

as forecast XX.X% our we for year. negative line modestly on X%. in well adjusted forecast Turning is our outlook margin full-year. little less ratio support the is Based to diagnostic the than to systems impact at exchange we market investments impact now reflects for full-year This Libre have our capacity expect the of rates, with and full-year. of X% of of our Alinity X% than a of the sales growth of of a on as current approximately lower expected organic sales, had to unprecedented ramp-up prior would reported temporary investments the sales gross the and an which We effects expansion. to We forecast the adoption in beginning

full-year expense and around as of XX.X% forecast less I of We rate sales. previously, of than an SG&A around adjusted for forecast of adjusted of XX.X% adjusted XXXX. investment R&D mentioned somewhat tax we X.X% sales the And

around our quarter, Turning X% of on would we reported to the third at of impact reflects X.X% strong quarter rates, forecast and have current adjusted a to We outlook EPS X% organic our of growth $X.XX, which negative to third expect forecast double-digit to sales growth. we $X.XX sales. exchange for

adjusted expense XX% and We of forecast of margin adjusted of less around a X.X% gross of investment sales. SG&A around sales, than sales, R&D XX.X% an adjusted of ratio little of

the I'll quarter growth Before overview a of sales our by provide for open organic third quick now we call questions, outlook business.

For mid Rapid single-digit areas in we Diagnostics, continued we and is which in to mid Medical of high Nutrition, Established low in growth; growth. in which forecast Diagnostics, forecast in digits Care high forecast single-digit businesses, Molecular Devices, we And forecast several high growth forecast double-digit we to growth; to Pharmaceuticals, Core we mid single-digit reflects finally Point single-digit grow business. growth, of Laboratory, this legacy single diagnostics comprised Abbott’s of and

for call the open now will we that, With questions.

Operator

And from from Stanley. [Operator Morgan Lewis instructions] first question comes our David

open. is Your line

David Lewis

the on the you, Good questions guide. second Miles, morning. have outlook the year. the and Congrats on for two I the diabetes, first quarter on for

So, starting adoption? investors the in diabetes. confidence tell your the with Libre in some the approval? designation. [ph] BGM anything ADA, Miles, this particular And what in Should concerns And about read what's [ushered] iCGM of around does lack level X approval? us Libre just into quarter iCGM trend

Miles White

I'm of couple a answers. give going to

shouldn't what approval the we we going have applied what concern. that no, for. one, and confident have to We're So expect we we're

little ask, we’re So, questions uncertainty comes day know that until I let the you actually, a background that our and on bit detail of to and more that. me always give there's COO investors know from And confident.

Robert Ford

relates Yes. those and shutoffs, short accuracy our iCGM, comment the standards earnings. have if I felt we last very And iCGM. that clear, an mean, special to we controls they're iCGM. and We of as it in cetera. The filed going special we thresholds, sensor fall they’re wouldn't to we’re as made very for filed And filed as transparent that controls. we alarms, et iCGM, an an this

an were by file we iCGM. fact, to agency X as In encouraged Libre the

to kind We're behind to people So, timelines. the exact it I want know, not of date. speculate our tie and

exact not relatively we're speculate So, here, soon. on it to but we going date expect expect

David Lewis

for you And is then, thing Miles the second the year. just guidance for

obviously range? the of half that I'm factors part year better the gets range what the to back top the second so the half success in into of end see much. versus XXXX guidance of gets range acceleration just part of the middle curious, ‘XX. the the key really the are think suggests, upper that Thanks And as the about a if year? what of So, you you you over range,

Miles White

guidance. say of I'd all of couple things, about first Well, the

business, drivers. A so of sort been to chronically forth MitraClip up all We're our in to We in of have the all diagnostics happy are improvement, cardiac seeing is capacity new We've quite be planned, opening care Alere which strength of But, the the up successfully and launches business, systems are out; what momentum. obviously manufacturing going sales sequential with diagnostics et we with stent the satisfied showing lot growth that is primarily time-to-time, lot of acquisition, sequential dissatisfied board. picking which got business, is and I've for, I'm businesses also growth on the that. Alinity rapid management I'm segments pharmaceutical the what business, never they're improvement, to Libre; the across business, worked a rolling supplement which in see. cetera. the point going the we've from rhythm the neuromodulation,

we going this, quarter, challenged temporary about So, feel the that do the all for the that range. we growth this in is the comfortable thing team, top-line frankly, And that, we we about the I strength or to see sustainable sort forward, fairly X% on of X% the feel rate said, based sustainable feel of it. and board half year across on I our

second for step rate. And earnings in it’s I a There’s then, I good, at as half least beginning that’s of always here That’s mean, at record and no with the next different going an kind year year. always the growth. the target So, into aggressive earnings in target, just growth double-digit the ourselves you quarter. unusual up know set earnings. now. all or We think, we of ambitious

remain our half, earnings second the strong. in So,

fall never -- of good do pretty I that know kind I we we numbers say and -- the short. I’m we don’t feel

bottom-line now. right it’s on XX% So, the

get of end range? high enough. good So, we It’s you’re thinking, I’m what asking that do about rate. the to pretty me a do healthy geez, the isn’t growth

obviously the a that groups compared well think peer peer in on rollouts, teens double-digit way, with that’s And and somewhere X different bottom the breadth the investment. challenges but some products several think group the And class and of all seem to in launching high in there’s is compared to. good pretty we across board be to I probably here doing always quite the we’re in in X on and I best frankly, we’re that the So, to world areas. pretty top

David Lewis

again. much. said. Thanks so Well Great. Congrats

Operator

you. Thank

question next Morgan. Robbie from Marcus JP comes Our from

is open. line Your

Robbie Marcus

good quarter. hindered could forward us want to approval? and of MitraClip. the congrats product your get and of for seem give MitraClip Alinity. growth there, just questions once some in have and on update Maybe you reimbursement two the hit considerations Great then I a you. Maybe trend CMS maybe to It at on all doesn’t on some status timelines But in uptake going maybe on quarter. line the for do you the comment

Miles White

I'm going Robert Alinity. and you, Okay. question answer to to that come have for back I’ll

Robert Ford

existing so, XX%. U.S. majority Robbie, global we saw, accounts. be by U.S. through really a that the driven sales in will over in great productivity growth over had quarter So, MitraClip coming XX%, in you increased The of

majority market increased growth constantly we’re obviously, of but -- we utilization. that accounts development, opening through new coming So, doing

we do and they have quarter. impact in clinical the expansion. direct invest in and to also when International double-digits was this, So, in utilization account field sales continue this you up And productivity.

You’ve believe in got we rebound versus significant Japan were in we there for in saw QX. where we’re us building capabilities Europe there QX our long-term and a opportunity Japan where a where is

the think, of putting and in teams some trials year. the second teams clinical medical context framing really the at job out the and conflicting a came that done have there, I of half those good into

still in think here here, our not opportunity single-digit. we mean, lot So, U.S., kind a of terms of rates sustainability I of the there’s low only are in penetration the

got a runway of here. we’ve lot So,

mean, a lot between going societies. obviously physician I and on coordination CMS, there’s of on the question been your that’s Regarding CMS

expect NCD part coordination. soon as very the be We to up opened of that

anticipate process around to early through say, we the I’m getting I As not forecast going timeline exact year-end year. the But, next here.

As impeded kind really you said, our the growth. process of hasn’t

their insurance is the to their a companies the to have Medicare include decision or segment. coverage indication. it’s there But in larger reflect updates of that to dozen to private Obviously, flight the the commercial new We kind see of seen so good already -- segment traction segment.

see in looking of continue reimbursement. to CMS So, the we towards quarter, the this very the of end and year, half good at expansion year achieving the second

Robbie Marcus

it lines this one, hits following product And on Great. up of Alinity, diagnostics. then, is all and your different

So, to the a out points of your U.S. competitors And could both the are line hard struggling, systems. pick progress give margin competitive some in it’s launch in the really Anything could the us maybe side Europe and us, seeing useful? update But, you top could appreciate data we the starting on just you see the market and competitive as it. just to in any be that it of status out. the launch you give on relates I maybe

Miles White

furthest chemistry true. the that Europe. laboratories they would you are is there market, molecular. clinical comment of point rollout. that along immunoassay our approvals course United And We're immunoassay expanding process stages of of The is dedicated in all the one that of chemistry and the it are systems for smaller rollout the the screening then every system core menu also in and these in of systems, Alinity different care States and Asia, and six hematology customers a they are China various system to And of Well, systems. conversion made as the have these they from and blood touches new that’s and the of diagnostics, plasma the at critical to mass using system, Southeast clinical of so certain a make part whatever menu obviously first, a want where system, be

test, well. generating we we're running going can, et now, in revenue, and think say, Europe, test pretty We generating systems of cetera. I the up deal, not fast results, over placed the as is we what and cetera, is There point deal we close record account the running X,XXX cetera. measure that’s just So, do measure as this the I’d et tests at call of when et generating running,

going with to as we're we closely build States is process in that same more well. going as of all We're of more tracking the I’d China, and tests. up say, we're menu getting talking United more those pick pretty the that hundreds so, That’s And momentum begin menus. breadth,

for We labs XX% is the is. think about product and important an blood we it and get find screening we plasma it’s will recently more supply longstanding from closed more This Alinity, Today, a I approval et of But efficient, cetera. plus. as Japanese and that Cross, the that took as screen economic blood the world’s with the largest did system. transition that’s -- started blood We up a is Red Japanese which competitor. organization, Japanese screening

win for big us. a was that So,

got is lot and very out that’s I of this a success call rolling as sort out, installed And in We've tell the there said run competitive price that momentum the our a it, over contracting do moving experience of occasional system you is on and our of think a is just instruments, duty have a and very-disciplined we is and time; accounts, volume. look far have lot XX% guess share is which rolling in quoted I growth So, remains system completely existing of be Hematology we’ve rates of new in stages where so of before the winning where so the base an add to will in and why pricing XX% of got heavy business, there of and do the rates the and we're early true, stage molecular a accounts. the launch of winning share, gains over entrenched it very cutting. now and win I and into, We way. about what accounts slower the we to seven of forth that in system. an to -- in already about we earlier competitor over Those got accounts replace not us business ours, years time. X,XXX in end, the five and we're next, we’ve that years penetration new

had have to We do that. not

that instrument to superiority think assay of the speaks offering. the I and

across is like many uniquely offering It's the our launch in matter we're all competitive. So, out type unprecedented feeling board account. what borne It’s systems no to this of by rates, areas. win the

analyzers. think with picks assay and and expands up some the So, as momentum this menu the in the I gets as there's only experience better field

Operator

Bank next Our from Bob comes Hopkins question from America. of

Your line is open.

Bob Hopkins

Just you Miles question, Congrats to on devices. then Robert back Miles, financial a if okay. big recently. question that announced a as questions, quick run and in for keep devices. okay, the guess, if two Lisa Robert picture on ask was year, want team Abbott is, COO, and question one hiring quick October of last additions I would one I to that promoted said when my management

wondering with time? just the kind could of if always change. his So, What investors do curious your about Robert all you reasons comment are the newfound plans. long-term will for on free And

hire. So, it's a question on the recent

Miles White

say Okay. Well, can couple not you, I tell golf. things. of a I'd playing he’s

we device all, medical top on wanted being, because business stay of anticipated Jude. the time him for responsible directly of that to the on-board for bringing we First he's been St.

business, the -- the has as also general St. people, that run to the one meaning have R&D, to align went a Abbott. acquired customers, at We et business, that business integral et would was integrated functions to through commercial I technical like describe As reporting of And to with We a commercial we that of sales, reorganization of service, with those cetera. commercial cetera, he Jude, the responsibility we fully but GM. like we I like for manager president that guess, that, business manufacturing way all integration. support, entire to a business

took same Alere realigned St. the did So, we when Jude. with quite we them frankly, over. We

Jude the Robert replaced and St. of as managers, full so, responsibility, we general some us And who and left in It's has led integrated each the or that And number that. a was forth. a we all That of part that had of so general earlier meant business management experienced acquisitions added transition. place.

So, transition. a we went through management

management Quite little of awful certainly, a the time, management going that same lot team the now lot change is we're we've there forward of growth the have structure been are making general long our new also the that always as let’s my to of bit I been management Abbott sure of our managers and there's got, been team been growth. regional of be look the and decade But thinking and a and have groomed call robust new time, just a of at happening And about teams. what we for organization that products, term we've grown an part a that long here. a with it, experience new the the all toward, pretty talent looking think organization, people at of

and replace needed and we held brought Chief the company. terrific experience and and sourced level the We for energy previous into We think role. So, EVP for we Lisa, in have that. role course to fresh has to did perspective Operating Officer that outside the great a had to of experience background went great We're that, Robert pleased very that that. who

So, time, very slightly what I his little more between cases smoothly up are into focus et who’s into read and these Obviously, and us went be a around units, the lines. growth, that kind we’ve read into pretty in done that. mid-XXs through in the him I’d perhaps further, break some had it, very COO And give Company that expect including gone to for plant to we’re a leadership like we some feel in that’s number the role adjusting. we a big building aggressive role smaller key because at long well. we businesses of We Robert some pleased moving diagnostics. cetera change, capital unwieldy organization very gotten with say managing up to of in of improvement, a

that when is one comes, after for of Company, legacy a this every preparation transition to its momentum And prospects the think that there’s on. leading going can I best we good this, do sure the are bit so, the is things to most And and its nobody growth leave long forward I so knows think of of as process going make of Company the now. down right from all is smooth just transition key I or important. sort think which I my it’s management And give the company perspective, legacies track through like of are upper not probably the all. the literally that they a can way record, all me, feel leadership is And this important I that as a the and is ranks important most of and transition

into I you no a I what can bumps. leadership, No. So, preparing is give be for No. well. Do with read you I it of call I that would it? think continuity about should nervous Will it going And actually timeframe? think speed we’re we that exceptionally

I experienced think poised in in perform in the across I I the companies people other a to team very and and got you that here we people perspective, come a that XX we’ve continuity look for got plus his the of he years. Company job him I’ve every leader, with experience, a I of think and mix well now from XX right the is from been years. this COO for confidence And company. Robert’s years tremendous got And we brings of over is trained exceptional. think outside great those that bit would everything mix Abbott known Lisa. Company management the to that in nice team board to brought the because like

and nothing just good think perspective, my keeps from this getting is So, but I better.

Bob Hopkins

That’s helpful. Brian. very seems so it quickly just little Very, for And have like an on Miles. tax do you great Thank rate, perspective. a I much, odd question but transition, just the

could kind the process seeing the steadily job you picture, sustainable tax down last that in of you you the today bigger here you. of made You in know guys talk -- here are rates that great kind of just where teens? and is doing I Thank lowish down. bringing the current couple a are rate and if we’re And been maybe, year. years But, have the slowly on of over comments

Brian Yoor

the Bob, rate it bounced tax want Yes. be be We we we think it where we set the it’s assess to we they out. as like always come And to don’t sustainable. to steady. around; rates

a we series the that the that digested as look and say always to as have come XX.X% here. but future just another forward. to I can’t situation sustainable where as I adapting to and we rates be those, is will rate and of predict adapting right We call efficient series we recently the can we’re now there’s out of come QX. clarity accordingly today, that here And our when as around you or bumping on and we we will us. for it well. rates around in efficiency with tax the we to happy just to And it happens, that we’re as don’t sustainability. of will adapt and sit digest But out rate continue see want manage

Bob Hopkins

you. Thank

Operator

next Our question comes from Kristen Barclays. from Stewart

open. line now is Your

Kristen Stewart

going you wondering allocation the let capital other through Thanks. maybe level devices? And just to great thinking dynamics on could then lackluster the of bit little Miles, was business growth talk just your just Company, much if just have a could impressive forward you maybe you about the you that with think you investments given through. flow the this growth the in are question. some and/or Company how a for really from lines you medical the strengthen of just how just I see of quarter prospective, just of on that more also thanks how Congrats about the Hi. and and thinking top-line opportunities offer

Miles White

couple a you of perspective. give I’ll Well,

debt, invest lot got thing said down We dying comfortable on pay all, is, obviously, But, before, as of And of we’ve the to we’ve mean, a us amount, did. great in it. point. a doesn’t at paid position that this flexibility. go we capital significant to of use to going things First in. standpoint, it a billion From a strategic $XX was down we're we're for important

products. was we’ve plant Libre for expansion need point. obviously we Diagnostics investing into at put into other got amount plant MitraClip this and to next And We're the and manufacturing both some So, and capital fair in a of expansion. put

that in doing plant got and support more, forth, fashion an we’ve appropriate and given got and the lot and that. growth from potential obviously, so capital growth to standpoint we're So, we’ve and happening for quality that timely of a awful a

this so, capital will. And it’s makes debt, right the making prudent all down right and it use sense, et We’ll we time careful there. be We cetera pay sure stuff. continue that Will debt? about and good to

maintain strong it dividend. last will to we end the our continue We increased dividend. substantially We a will year; at healthy, grow of

told rate, the by PE been a of that a difficult, have. happy to problem as where upward get yield I’ve is dividend funds but Given now, trying to number that’s are nice that shareholders

been We it’s grow it to the continue Company of will decades, and to will be. our the for hallmark continue dividend,

to away the return it’s grow an it cetera. different it option? -- not then, shares, get ways cash won't to of prudent buy we're and timing the matters is. our to And Yes, to Probably return Is because et carried and only too a shareholders shareholders. number that return able back return good matters, frankly

we we got a as can it’s an lot So, itself, option do. always just presents it

a much thing automation might terms small in for nutrition currency we’re that’s potential the of growth so be opportunities while we don’t foresee that’s are in ignore front don’t us. that to that that I businesses, and so to it now, have diagnostics, hard that diagnostics things our quite right and through think we a business something, we tell M&A front and feel to our opportunities asking We just that I to in. we so about and worth of runner growth like many now. tracking I in. we now always we not right our Germany nor But, real right think got things, real we -- sufficient don’t a even things can't you nor see And you're do it, forth, do that that try and M&A in that add on something adjunctive interested for monitor that we’ve valuable like did other all nice on while. opportunity value to, to organic If We we acquisition and invest make maintain can it pharma continue we we being need we're devices, outcut in just

So, capital side. that’s the

trying of the wouldn't the growing of doubt On I the Abbott with efficiently we them or And they could spend the earnings money, faster. to business. it products voracious balance that growth business that manager investing a side, and more claim gave our grow always if at appetite there's for we're to investors expense that effectively general in

to right return of our the with the the the find growth balance much the trying of healthy always gas that’s products fire returning to in we're of investors. how of a thrown expectations So,

because there's balance, issue, thinks is think quarter. always an in somebody some investor I penny penny. very morning speaking always there that must this about there the a who I who be another asked -- extra to that's was And

and rate particularly for our the top-line commensurate strong, growth, years, much So, sales it's richness got to coming We've sector, issue quarter. year. This tremendous that's so it’s our the products, we’re and bottom-line not here coming is is be growth coming a the new unusual This much penny. rate growth size sustain our penny than accelerating to unusual a healthy pretty companies a healthy in rate for a isn't healthy about quarter, on is with bigger able and about it's sustainable. in growth such of given

in and by to growth. right the right the keep rates expenses drive how spending trying enough the and higher. marketing balance putting growth question And that even drive fuel raise sales you to do to is that we're and to fire So, we investing find as the well here R&D

Kristen Stewart

Okay. device Devices was of reporting really cities flattish the with questions. businesses you businesses a two so you think that of how strong -- growth much around term about growth? a longer of obvious the lagging has think taking a dynamics Medical you about How It How but Then, nice quarter. kind business on several of do medical seems to of do still tale the level just phenomenal bit ability the just view sustain do that one kind question growth. double-digit this the of Thanks growth, there? couple for

Miles White

Yes.

You've got businesses a mix of here.

new more or what different are In And that mature devices maturity innovation at are than growth. is are some that some different either general the have new time, case. over got drives And that's of that in stages little businesses innovation. You've brand the terrific a others, products medical innovations.

device that own was X% we cetera. St. their it negotiating that opportunity underappreciated growth didn't The Jude, acquisition St. right. yet, that of Jude with We the at Dan in see was I products new we performing we've at that believe rate either was and replacing there's products pipeline simply et single-digits. of because at from strongly high lot level with seen been the were Dan in internal models agree that the in altogether. performance to brand out there medical my the in a sort market, time, St. that think the street when new older business it still products Starks pretty or felt because a of the there. the acquired discussions And it's over remember XX% didn't But to have gone the Jude, just as of I Dan

medical of innovating people MitraClip’s got keep Failure so It's benefit would niches It that massive. diabetes about and unlike So, most approaches medical spaces, device a Xs, devices and and type in I'd Libre say, seen million market, the therapy. new first a that. is businesses. forth. or new new technologies, are But anything market, niche diagnostic cetera. affects not type than new thing HeartMate the mass is more in is Xs unique. in and Libre is space, that around you devices something of from XX-XX address a before spaces, XX a These Libre and about to is et Heart world

opportunity scale. that enormous, having honest, medical just at with used device be there. of deal to aren't kind And traditional so, there's an To to companies enormous

by the heavily And mass so investing addressing we so, that we’re can manufacturing after that go a in expansion niche. very not market,

markets More and be And there not products growth much have more access, after people and driven of only the think the level. as sustainability affordable innovation will so, more by more ability to affordable. a growth much but at will the I bigger more technologies go the is we make

growing aren’t like I about we’d businesses finally, I'm you then, But, as the disappointed fast say well, asked that some not as am fast. I’d to. them they’re And always that growing that And of in seen seen and neuromod, in in CRM, quarter-to-quarter improvement even all and seen that forth. in it almost in it we’ve sequential of stems We’ve that we’ve pleased so we’ve in them. EPD seen

We’re seeing incremental improvement.

businesses there’s pretty of see Some to single-digit to low be big business upside. to negative growth a or lot in area double-digit going think we of from bump take is If or businesses not If from still it. X%, growth, as that’s XX growth. what we’d they’re mid of these strong, XX, mature CRM about capable excited may flat, the single-digit was strong X% still and or high pretty slightly but in a -- all I it more

growth it’s same the lower the So, just incremental level. think improvement I possible, is

overall that think be is to always time or lot sustain new Libre period for kind the going growth. the to or disproportionately singularly I that So, there There’s like of a a growth we’re a of drive seeing. products here MitraClip HeartMate

arena many businesses somewhere of benefits going in future. there’s other to we’re be the in that’s the device where having is the of places that for One innovating way growing always

Operator

next Capital Wuensch our from comes And BMO you. Joanne Markets. from question Thank

open. line Your is

Joanne Wuensch

spend can question. international an anything of quarter. and little nutrition update give thank morning, a you taking to like Is franchise? you the of that the on there piece particularly really us for that bit on everybody, Good well particular and adult did nutrition, the I’d time in

Robert Ford

Yes.

business. you sequential had, as in we improvement nutrition So, our noticed,

performance. We’re very with pleased the

to see execution well. the and see sustainable, to our We’ve executing that above in market We the in products X% it a that. in we lot growth see We people X% new we of to and the We are kind of over range. competitiveness changes get made several think of continue years, enhance do is countries. kind enhancements to market strategies and of

So, kind we’re that that X% of coming in a always good business specifically driving saw and again above you execution quarter and in our for growth out Asia. with this something of adult

Miles White

up business, but strong a adult in got lot markets little business, expansion holds OUS pretty Joanne, in given places The new opportunity the -- Vietnam that formats, lot and of is was also and new for we’ve growth. product other a XX% OUS where innovation, further over of like adult

a like, more U.S. say, on in of where Robert all And put some and I’d the particularly lot there’s there’s of get China attention a India So, this the and lot attention of in said, Southeast a and always as others but the opportunity. business, those. the markets adult growth, we’ve and lot historically, Asian segment.

Joanne Wuensch

us “problem that? one Can medical pathway through is in second recovery the And in Thanks. question, to devices you. as walk children” you my of the Thank in neuromodulation. the

Miles White

sure. Yes,

you increased occurs We So, completed in an want -- the cetera. talking is obviously be, that et to QX. territories when not Obviously, force the an but Joanne, sales that We sales about. cutting been in we’ve where and through that, there we landing terms about the spot, by improvement saw force of improvement like trading the not our XX%. we that’s And expansion we’re something there. disruption go some

that And that second and team. in sales of improving completed we we’ve quarter. So, productivity obviously saw now the focus the that is the

some also I’d improve as rates, to we KPIs, saw year. and life at to improvement product versus trials of second trial it's into QX, whether this or cycle. look you if that we conversion A is, at permanent look half of portion the definitely of If sequential you say, innovation go expect big we this implant

of You’ve space. and where really couple driver now kind key seen execution. this competitors so hasn’t from been of sales a also, That’s in quarters a force there any launch productivity

the of last of in the will We see years. innovation couple We over made that our double to investment R&D business start some output.

year, work half in I’d provide this that beginning in the output terms We kind will see year start products of second to with. more for sales new of of of that to say will next some team of the

Scott Leinenweber

more take one will we Operator, Thanks. question.

Operator

from Matthew Thank Taylor UBS. you. comes final And our from question

open. Your line is

Matthew Taylor

you question. on points. Hi. two I for back Libre Thank on the taking circle to wanted

you're first and that times. the said capacity was that an that to capacity. by article three Reuters the yesterday mentioned So, five you increasing working that is expanding There you're on

in be it it’s Does ultimately you $X more billion, product use? $XX So, if expand think as $X the Libre Libre additional on consensus. that that mass market? billion could X you on And capacity billion with go mean can and approval we how of second talk step you you that of to to think about approaching rapidly can the year, the about type year based maybe this gas the

Miles White

I But be gosh, And $X I quarter, your to are there. of call same XX. can’t kind one ambitions, this honest. I’ve how and question, the aggressive thought soon. was last to guy. got Matt, it’s get of remember is this I wouldn't you answer billion whether just I XX we or three if later, that the later. it potential think you expected question we months days on could -- got recall have

the all number it’s do $X hard we the awfully get I think, product. to things growth, time, think design we big. reasonable very product. kind which I scale-up of and do for speculate about price that I products will we And it’s and billion a it’s our different in will affordability utility, will market as a in we're think But, a of but only the -- profitable do I unprecedented times, and $X a and very Yes, size large that, this over? do. the billion space. for the market of utility sales that, reflective here And mass for now going that growth affordability the I through of rate where its it’s those the the its scale, is niche I and make a many the of -- not is And just the access, of product, it’s I think think, market said need addressing

potential it got can but think level? products to jinx and over I potential, analytes say trying I as that won't enormous and some glucose. sort It's anything a other other by got I potential think that $XX time. prognostication billion it's and wearable So, got I it's to do beyond in make about would of grow

of not categories repeated other underway, so the diabetes the for analytes programs R&D in only have enhancement also but other improvement, We forth. and beyond expansion Libre, and

validity. your hard with to enormous. think numbers coming honest, aspirational we glucose will which that much going is We're the as aren't years around even that beyond it. people can I that to lot things at I But more a consideration, over that think, there's that just any I'm not so be the contemplating opportunity, of put there's has today ready least as the here evolve So, product. at

Matthew Taylor

of follow-up, get And from to was Libre that last get people's when bubbles perception feedback on Libre investors Street’s that think to one great then, you really But answer. think your you the view do wanted maybe that what internal feedback you is a perception? today, differs just or about Where misunderstood you? from up the

Miles White

to been living COO. ask me is within the it long He Let a time.

Robert Ford

Yes.

challenge went with that get we all Matt, that. XXXX, I wasn't very of challenge reading think, able systems interstitial and to accurate the The about way about cost years the in back of that in and get accurate and It it for we that. when several effective is to accurate health were how and -- this we the for for consumers we to ago, was for reading. Libre here, an went when fluid. is to glucose do up had from an Navigator, a able that we launched do were

community cost technology cover the insurance core to after we we're at the payer accurate most a health Navigator of you chemistry, was is accurate to that could systems and readings. and the at what makes that reading In was that a the able at reliable the time leverage of how that sense position you the get is that is it. really Navigator, core So, time at position for accurate went the And remember But now might which do core cost for Libre. the provides considered sensor. the of

sensor-based went whether in were mass can were sense about outcomes Miles just, me scale. years enough. about wasn't that's a it a question on whether a glucose were what core. the now convinced was outcomes at It of do that I right, And were talked ago. or It has it makes scale. That's way after we XX mass And this the for the the They to outcomes there do monitoring. that for

we do. a to just misunderstood, that's of I this different can the imply that accuracy important. that’s maybe without And and having massively a it's of accuracy discussion accuracy a what at priced missing fact and And it sacrifice our that this at of the well, necessarily different different because to here say we we obviously that I price strategy available focused reality level But, on view at is somehow this is level. make goal think wouldn't point accuracy. something, had lot

Miles White

there cost to United out niche that The and Street at the aimed in expensive is been it States. the has and to able only compare product high

we not the is But expensive, clinical pretty sophisticated so it's cost. not or a like. It's pretty not for to does is product. automated, performance, any product. able cost accuracy, what achieve of are is sophisticated manufacturing and Ours and high a highly and low lack It because a profitable

compromised been haven't and that it’s design has that cost. it It on scale of successful in all. structure, completely And that’s it different heavy before, so produce we is rising. and So, the volume can investment, And broadly actually told at product for seen XX%, capital a approach that’s relies the margin. gross is terms that over is kind profit; improving of is a it not and with we’ve the gross comprised cost that available. We we margin

do and geez, designed I money. whatever, got I you lower the healthcare be do days And there, affordable insurers, community, congress, money? be to when market I to make there say, cost, how got think out I always misunderstandings make the So, be healthcare’s patients product accessible. the we think say, just Thank well are is more We we think payers, people affordable. guess, some if it’s fine. you. Oh, among to

and massively so. Here’s example, it’s is, it your

broadly with means that so, unprecedented. broadly at to worldwide it approach gone XX this that’s available, we’ve case in And people make it million

another the so. increment, capacity. has also keep understood totally because capacity we’re every literally incremental sure XX adding it saying line, it’s significant And So, on capacity I'm I that so days the new different. not device the we as staged think comes community that But we’ve so now

that lot some of be is put and constrained. open to and will of market not freedom We kind even a haven’t capacity product up release markets And yet. forward we opened

So, earlier, too more we’re see market technologies I make the opportunity very I then here. there’s think number this, of wearables like what’s like different I affordable lot I And is. there’s mentioned opportunity this of a think called in think market, and going the for a accessible a expansion. to things products

Scott Leinenweber

now your Abbott Investors Thank you, all for of am today operator, you Time will today. for of thank available Central on concludes Abbott’s questions. Thank us call. This website abbottinvestor.com. A joining Relations you after this and at conference replay webcast XX call be

Operator

Ladies for and the you does and today’s have in you thank gentlemen, disconnect. may day. conclude program a all Everyone, This participating conference. wonderful

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