Imaging giant Philips sees sales decline amid ongoing ‘headwinds’ in the industry
Imaging giant Philips saw its comparable sales decline 7.6% in the third quarter amid ongoing “headwinds” in the industry, leaders reported Monday.
Those included continued uncertainty related to the COVID-19 pandemic as supply chain “volatility” intensified globally including a shortage of electronic components. These challenges have led to longer lead times for filling orders. Philips anticipates this will continue in the fourth quarter, forcing the Amsterdam-based company to lower its sales and profit outlook for the rest of 2021.
“Based on our strong customer demand and growing order book, we expect to resume our growth and margin expansion trajectory in 2022 as we work through the headwinds,” CEO Frans van Houten said in a statement.
Philips also navigated a large-scale recall of respiratory devices in Q4. However, its diagnosis and treatment business served as a bright spot, recording 10% comparable sales growth. Image-guided therapy recorded a double-digit increase while diagnostic imaging and ultrasound notched high single-digit improvement. Comparable order intake rose about 15%, Philips said, and the segment’s adjusted margin increased by more than 14%, driven by sales and productivity measures.
Altogether, the company’s adjusted earnings before interest, taxes and amortization dropped 25% in Q3 to $592.7 million (USD).
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.