Abbott Labs Q3 2025 Earnings: Medical Devices Surge, Diagnostics Dip

Global healthcare giant Abbott Laboratories has just released its financial results for the third quarter of 2025, and the numbers reveal a company successfully navigating a shifting healthcare landscape. In this post, we'll dive into the key details from their latest 10-Q filing with the SEC to understand the story behind the figures.

For the third quarter ending September 30, 2025, Abbott reported net sales of $11.4 billion, a healthy 6.9% increase from the same period last year. Interestingly, net earnings remained remarkably stable at $1.64 billion, nearly identical to the prior year's quarter. For the first nine months of the year, the story is even stronger, with sales climbing 6.1% to $32.9 billion and net earnings rising to $4.7 billion from $4.2 billion in 2024.

To better understand how Abbott generates its revenue and manages its costs, the following flow diagram visualizes the company's income statement for the most recent quarter.

The Powerhouse: Medical Devices

The standout performer this quarter was undoubtedly Abbott's Medical Devices segment, which is its largest division. This segment, which includes everything from pacemakers and vascular stents to the popular FreeStyle Libre continuous glucose monitoring systems, saw its sales surge by a remarkable 14.8% to $5.4 billion.

This impressive growth wasn't isolated to one product. Key drivers included:

• Diabetes Care: Grew to $2.1 billion, up from $1.7 billion in the prior-year quarter.
• Structural Heart: Sales jumped from $558 million to $635 million.
• Electrophysiology: Increased from $610 million to $705 million.

This powerful performance boosted the segment's operating earnings to $1.8 billion for the quarter, up from $1.5 billion last year, cementing its role as Abbott's primary growth engine.

The Challenge: A Post-Pandemic Diagnostics Market

On the other side of the spectrum, the Diagnostic Products segment faced headwinds, with sales declining 6.6% to $2.3 billion. This division, which covers a range of tests from core lab instruments to molecular and point-of-care diagnostics, has been adjusting to a post-pandemic world.

The main factor behind the decline was a drop in Rapid Diagnostics sales, which fell to $600 million from $824 million in the same quarter of 2024. This reflects the tapering demand for COVID-19 related testing, a trend affecting the entire industry. As a result, the segment's operating earnings fell to $400 million from $558 million.

Steady Eddies and Shareholder Returns

Abbott's other two segments delivered solid, steady growth.

• Established Pharmaceuticals, which sells branded generic medicines internationally, grew sales by 7.5% to $1.5 billion.
• Nutritional Products, home to well-known brands like Ensure and Similac, saw sales increase by 4.2% to $2.2 billion.

Abbott also continued its commitment to returning capital to shareholders. The company paid out over $1 billion in dividends during the quarter and repurchased $303 million worth of its own shares in July. The company still has a hefty $7.0 billion authorized for future buybacks.

Final Thoughts

Abbott's third-quarter results paint a picture of a well-diversified company in transition. The explosive growth in Medical Devices, led by its diabetes care franchise, is more than compensating for the predictable decline in its diagnostics business. This ability to pivot and lean on different parts of its portfolio highlights the company's resilience. The key challenge moving forward will be to sustain this momentum in its growth engines while finding a stable footing for its diagnostics segment in a new market reality.