Philips’ receives financial boost from $212M tariff refund
Philips saw its profit outlook boosted in the second quarter with the receipt of a $212 million (USD) tariff refund from the United States.
The Amsterdam-based medical imaging manufacturer on Monday reported its financial results for the three months ending June 30. Philips said it notched income from operations of about $694 million, which included the nine-figure refund from the States.
America’s government started issuing the first wave of these rebates in May following the Supreme Court’s February ruling invalidating such taxes on imported goods. Philips previously estimated a year ago that U.S. tariffs could have a $340 million net impact on its bottom line in 2025, with the company later investing in U.S. manufacturing partially in response.
“We largely completed the U.S. tariff refund process during the quarter and continue to actively manage the broader macro environment, including inflation,” Royal Philips CEO Roy Jakobs said in a statement July 27. “Our productivity program is on track, helping to largely offset these pressures. We are strengthening our supply chain resilience as we continue to put quality at the heart of our operations.”
In Philips’ Diagnosis & Treatment segment, which includes radiology devices, comparable sales for the quarter increased by about 2%. Adjusted earnings (before interest, taxes and amortization) margin increased to 14%, including a U.S. tariff refund benefit of about 5%. When excluding the payout, adjusted earnings decreased due to cost inflation, higher tariffs and “unfavorable mix effects, partly offset by productivity measures.”
Philips also highlighted the benefits of “disciplined cost management” and “productivity initiatives” that helped deliver the manufacturer over $150 million in savings for Q2. The company on Monday reiterated its full-year outlook for 2026 but expressed continued uncertainty around the greater macro-environment. It boosted cash flow projections for the year slightly, in response to receipt of the refund.
You can read more about its Q2 results here.
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.