Baxter Shares Tank As 2026 Profit Guidance Falls Below Expectations

Baxter International Inc. (NYSE:BAX) is trading closer to the lower end of its 52-week range of $17.4-$37.74.

Baxter reported a fourth-quarter adjusted EPS of 44 cents, below the management guidance of 52-57 cents and the Wall Street estimate of 54 cents. The decrease was driven primarily by an unfavorable product mix.

The medical device maker reported sales of $2.974 billion, up 8% year over year on a reported basis and 3% on an operational basis, beating the consensus of $2.824 billion.

Management expected fourth-quarter sales growth of approximately 2% on a reported basis and a decline of approximately 2% on an operational basis.

Segment Breakup

Medical Products & Therapies sales were approximately $1.39 billion, increasing 6% on a reported and 4% on an operational basis.

The increase reflected higher sales from the Infusion Therapies & Technologies division, driven by strength in IV solutions.

Continued strong global demand for Advanced Surgery products also positively contributed to performance. 

Healthcare Systems & Technologies sales were $827 million, an increase of 5% on a reported basis and 4% on an operational basis, reflecting demand for Care & Connectivity Solutions products and growth in the Front Line Care division.

Pharmaceutical sales totaled approximately $668 million, an increase of 4% on a reported basis and 2% on an operational basis. Performance in the quarter reflected continued strength in Drug Compounding, partially offset by reduced sales in Injectables & Anesthesia.

“While we delivered sales growth across all segments, our fourth-quarter results did not meet our expectations, underscoring the importance of our focus on driving continuous improvement across the enterprise,” said Andrew Hider, president and CEO. “We recently introduced a new operating model that is designed to simplify our organization, accelerate innovation, and improve performance.

Guidance

Baxter expects fiscal 2026 adjusted earnings between $1.85-$2.05 per share, compared to the consensus of $2.25.

Adjusted operating margin is expected to be between 13%-14%

The hospital product maker forecasts 2026 sales of $11.24 billion-$11.36 billion, compared to the consensus of $11.31 billion. Baxter expects 2026 sales growth of flat to increase by 1%.

BAX Price Action: Baxter shares were down 15.6% at $18.79 at the time of publication on Thursday. The stock is trading near its 52-week low of $17.4.

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