On August 6, 2024, Baxter International Inc (BAX, Financial) released its 8-K filing for the second quarter of 2024, showcasing a robust performance that surpassed analyst expectations. The company, known for its diverse portfolio of medical instruments and supplies, reported significant growth across all segments.
Company Overview
Baxter International Inc (BAX, Financial) offers a variety of medical instruments and supplies to caregivers. The company enhanced its portfolio of hospital-focused offerings by acquiring Hillrom in late 2021, which added basic equipment, including hospital beds, to the portfolio. About half of Hillrom's revenue comes from more digitally connected offerings like its smart beds and Voalte medical communications app. From its legacy operations, Baxter offers tools to help patients with acute and chronic kidney failure, which it plans to spin off by mid-2024. It also sells a variety of injectable therapies for use in care settings, such as IV pumps, administrative sets, and solutions; nutritional products; and surgical sealants and hemostatic agents.
Q2 2024 Financial Highlights
For the second quarter of 2024, Baxter International Inc (BAX, Financial) reported worldwide sales from continuing operations totaling $3.81 billion, marking a 3% increase on a reported basis and a 4% increase on a constant currency basis. This performance exceeded the company’s previously issued guidance of approximately 1% on a reported basis and 2% to 3% on a constant currency basis.
| Metric | Q2 2024 | Q2 2023 | Change |
|---|---|---|---|
| Net Sales | $3.81 billion | $3.71 billion | 3% |
| Gross Margin | $1.43 billion | $1.11 billion | 29% |
| Adjusted Diluted EPS | $0.68 | $0.55 | 24% |
Segment Performance
Baxter achieved better-than-expected sales growth across all segments in the second quarter at constant currency rates. Double-digit Pharmaceuticals sales growth was driven by the ongoing impact of new product launches and heightened demand for Drug Compounding services. Mid-single digit sales growth in Medical Products & Therapies reflected the benefit of positive pricing and demand for a wide range of products across the portfolio, including the first U.S. sales of the Novum IQ large volume infusion pump with Dose IQ Safety Software. Sales performance in Healthcare Systems & Technologies (HST) was driven by increased demand for Care & Connectivity Solutions products, particularly Patient Support Systems products.
Income Statement and Key Metrics
For the second quarter, total net income (loss) attributable to Baxter from continuing operations on a U.S. GAAP basis was ($314) million, or ($0.62) per diluted share. These results include special items totaling $659 million, primarily related to the impact of a goodwill impairment charge for the Chronic Therapies business within the company’s Kidney Care segment, separation-related costs, and intangible amortization. On an adjusted basis, excluding the impact of special items, income from continuing operations was $0.68 per diluted share, exceeding the company’s previously issued guidance of $0.65 to $0.67 per diluted share.
Corporate Responsibility and Future Outlook
Baxter published its 2023 Corporate Responsibility Report in July 2024, highlighting its commitment to global healthcare and environmental, social, and governance (ESG) topics. Key accomplishments include investing over $143 million since 2021 to support underserved communities and completing 150 energy conservation projects in 2023, estimated to reduce greenhouse gas emissions by approximately 21,100 metric tons carbon dioxide equivalent per year beginning in 2024.
Looking ahead, Baxter has increased its full-year sales guidance and now expects sales growth of approximately 3% on both a reported and constant currency basis. The company also raised its full-year adjusted diluted EPS guidance to a range of $2.93 to $3.01.
"Baxter’s strategic transformation continues to gain momentum and drive performance benefiting our broad range of stakeholders,” said José (Joe) E. Almeida, chair, president and chief executive officer. “In addition to delivering positive top-line and bottom-line results in Q2 2024, Baxter’s portfolio of medically essential products continues to expand with the launch of leading-edge technologies and differentiated product presentations."
For more detailed information, please refer to Baxter International Inc (BAX, Financial)'s 8-K filing.
Explore the complete 8-K earnings release (here) from Baxter International Inc for further details.
