GE HealthCare Blames Tariffs For Lowering 2025 Profit Outlook, Initiates Stock Buyback

On Wednesday, GE HealthCare (NASDAQ:GEHC) reported first-quarter 2025 adjusted EPS of $1.01, which beat the consensus of 91 cents. It was up from 90 cents a year ago.

The company reported sales of $4.78 billion, beating the consensus of $4.66 billion.

Revenues increased 3% on reported and 4% on an organic basis year-over-year. Revenue growth was broad-based across all segments, with overall strength in the U.S.

Total company book-to-bill was 1.09 times. Total company orders increased a record 10% organically year-over-year.

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The net income margin was 11.8% versus 8.0% for the prior year, up 380 basis points (bps). The adjusted EBIT margin was 15.0% versus 14.7%, up 30 bps, as both measures saw benefits from volume and productivity.

Stock Buyback: GE HealthCare authorized the repurchase of up to $1 billion. “Our capital allocation priority remains focused on investing in our business to accelerate growth, but we believe that a share repurchase program allows us to opportunistically return capital to shareholders and is a demonstration of our view of GE HealthCare’s strong long-term business prospects,” said Jay Saccaro, Vice President and Chief Financial Officer.

GE HealthCare President and CEO Peter Arduini said, “Regarding the current global trade environment, we are actively driving mitigation actions. We continue to see strong customer demand in many of the markets we serve and are well-positioned to drive long-term value as we invest in future innovation.”

Guidance: GE HealthCare updated 2025 full-year guidance to include the estimated impact of announced tariffs. It reaffirmed 2025 organic revenue growth of 2% to 3% year over year.

The company expects an adjusted EBIT margin of 14.2%-14.4%, down from prior guidance of 16.7%-16.8%.

It forecasts an adjusted EPS of $3.90 to $4.10 (vs. consensus of $4.69), reflecting a 9% to 13% decline versus 2024 adjusted EPS of $4.49, which includes approximately $0.85 of tariff impact; this compares to the previous guidance of $4.61 to $4.75.

The company forecasts free cash flow of at least $1.2 billion, compared to previous guidance of at least $1.75 billion.

In March, GE HealthCare acquired the remaining 50% stake in Nihon Medi-Physics Co., Ltd (NMP) from Sumitomo Chemical, giving it full ownership.

• NMP’s product portfolio includes GE HealthCare radiopharmaceuticals used to enable molecular imaging across neurology, cardiology and oncology procedures.

• NMP generated revenues of 28.2 billion Japanese yen (~$183 million) in 2023. GE Healthcare acquired Amersham plc in 2004 and subsequently held a 50% stake in NMP.