Powered by its Freestyle Libre glucose monitor and other medical devices, Abbott Laboratories posted a 2% increase in sales for its first quarter this year, topping $7.5 billion worldwide and ahead of expectations.
But its stock price still took a dent—dropping about 4.5% the day of the news, down to $72.86—following no change in its forecasts and uncertainty on how far a large devicemaker like Abbott will be able to grow in the future. It has since crept back up to nearly $74.
Still, that increase in sales reaches 7.1% when you exclude the impact of foreign exchange rates, as well as 2018 revenue from an adult nutrition business that the company discontinued in the third quarter of last year. Abbott’s projected full-year earnings per share held unchanged at $3.15 to $3.25.
Its first-quarter rise was fueled mostly by three products: the Libre continuous glucose monitor system, the minimally invasive MitraClip heart valve repair device and its Alinity core laboratory diagnostic hardware. Together, those three accounted for 62% of Abbott’s growth while only making up 26% of its revenue, according to analysts at Jefferies.
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During the quarter, Abbott received an FDA approval expanding the use of MitraClip to secondary mitral valve regurgitation resulting from advanced heart failure. The company also obtained a CE Mark for its Alinity molecular diagnostics system and assays for infectious disease testing, which is not yet available in the U.S.
Elsewhere, the FDA approved the TactiCath sensor-enabled force ablation catheter for treating atrial fibrillation, as well as a pea-sized implant for newborns—the Amplatzer Piccolo Occluder—to treat life-threatening openings in the heart.
"We're right on track with our expectations to start the year," Abbott Chairman and CEO Miles White said in a statement. "All of our key long-term growth drivers are performing well and we're targeting another year of strong sales and earnings growth."
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All told, the medtech giant’s worldwide device sales swelled 5.5% to $2.9 billion, the company’s fastest-growing division—helped along by $379 million for its Libre monitor alone, an increase of 70.2% compared to 2018’s first quarter, which also helped drive a 34.4% increase in its diabetes care segment.
Abbott's diagnostics business, meanwhile, posted $1.8 billion in international sales, with its 3.3% growth in the U.S. stymied by a drop of 1.7% overseas for an overall growth of 0.2%.
While Jefferies analysts described the numbers as a “strike down the middle” to start off the year, they expressed broader concerns over the market and political pressures faced by the healthcare industry, including whether pricing scrutiny will carry over from hospitals, payers and others into the medtech sector. Still, they described Abbott as a good place to “ride out the current storm.”