Imaging giant Philips eyes exit from $2.5B appliance business to focus on healthcare
Amsterdam-based imaging giant Royal Philips said this week that it’s exploring an exit from the consumer appliance business, which generated more than $2.5 billion in sales last year alone.
Company officials noted that the numbers in this division—offering everything from refrigerators to washing machines, coffee makers and air fryers—have improved measurably. But Philips views this product line as disposable, with plans to explore a sale over the next year and a half.
“We have significantly improved the performance of the domestic appliances business over the years, which has made a very important contribution to Philips, however this business is not a strategic fit for our future as a health technology leader,” CEO Frans van Houten said in a statement issued late Monday night. “We are committed to finding a good home for this business to continue to thrive and grow over time, as we expand and invest in our consumer health and professional healthcare-related businesses.”
Company officials said they plan to spin off the product line into a separate legal entity in the next 12-18 months. They’re committed to “seamless transition” of the company, with “continuity for our employees, partners and customers.”
In addition to imaging, Philips said it will continue to invest in its personal health business line that represents more than $3.8 billion in annual sales, focused on “connected products and solutions to support the health and well-being of people.”
Overall, Philips reported $6.6 billion in sales for the fourth quarter of last year, a 3% uptick when compared to the same period in 2018.
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.