Abbott Stock Falls to 52-Week Low on Revenue Miss, Nutrition Woes
A sharp 9% decline in the company's nutrition division and weak near-term guidance overshadows strong growth in medical devices, prompting a sell-off.
Shares of Abbott Laboratories (NYSE: ABT) fell sharply in Wednesday trading, plunging more than 7% to a new 52-week low after the company reported fourth-quarter revenue that fell short of analyst expectations and issued a disappointing near-term forecast.
The diversified healthcare giant’s stock traded at $111.88, a decline of 7.33%, as investors reacted to a pronounced slump in its nutrition segment. The division, responsible for products like Similac baby formula and Ensure nutrition shakes, saw sales plummet 8.9% to $1.94 billion, significantly missing consensus estimates of $2.2 billion.
Overall, Abbott reported quarterly revenue of $11.46 billion, missing the average analyst forecast of $11.8 billion. While the company’s adjusted earnings of $1.50 per share met expectations, the top-line miss and a cautious outlook for the current quarter weighed heavily on sentiment.
Abbott guided for first-quarter 2026 adjusted earnings between $1.12 and $1.18 per share, below the $1.20 consensus. This near-term caution appeared to eclipse a more optimistic forecast for the full year, sparking concerns about the growth trajectory of key business units.
The weakness was not confined to nutrition. The company’s Diagnostics division also posted a 2.5% decline in revenue to $2.46 billion, partly reflecting a continued drop in demand for COVID-19 tests.
The results highlight a growing divergence in Abbott's portfolio. Its largest business, Medical Devices, continues to be a bastion of strength. The unit posted a 12.3% increase in fourth-quarter sales to $5.68 billion, fueled by strong demand for its market-leading products, including the Freestyle Libre glucose monitoring system and various cardiovascular devices. The Established Pharmaceuticals division also delivered solid 9% revenue growth.
However, the robust performance in medical technology was not enough to offset the persistent challenges in the nutrition arm. The segment has struggled to fully recover from the damage to its brand and market share following the 2022 voluntary recall and shutdown of its Sturgis, Michigan, infant formula plant, which created a nationwide shortage. The latest figures suggest that regaining consumer trust and competing effectively remains an uphill battle.
Despite the market's reaction, Abbott's leadership projected confidence. "In 2025, we expanded margins and achieved double-digit earnings per share growth, our new product pipeline was highly productive, and we took important strategic steps to shape the company for the future," said Robert B. Ford, chairman and chief executive officer, in the company's earnings release. "We're well positioned for accelerating growth in 2026."
Abbott is forecasting full-year 2026 adjusted earnings to grow approximately 10% at the midpoint. However, as noted by analysts at Investing.com, the immediate focus for investors remains on the revenue miss and the softer-than-expected guidance for the coming months.
The sell-off pushed Abbott's market capitalization down to approximately $211 billion. Investors will now be closely watching for signs of a turnaround in the nutrition business and continued momentum in medical devices to determine if the company can meet its ambitious full-year targets.