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⚠ Currency: Sales Up, Earnings DownLow threat

Abbott Laboratories (ABT) — threat to the moat

Foreign exchange raised Abbott's 2025 sales and lowered its operating earnings, the mismatch of a company that sells 61% abroad.

A company that sells 61% abroad1 carries currency risk in both directions. In 2025, Abbott says, foreign exchange "favorably impacted net sales and unfavorably impacted operating earnings"2. That is the uncomfortable kind of exposure: costs incurred in one set of currencies and revenues earned in another.

Abbott sales growth, Q2 2026 (%)13.0Reported12.2Excluding currency4.8ComparableAbbott Q2 2026 earnings release; comparable also includes Exact Sciences in both years
Currency added under a point; Exact added most.

The effect shows in the 2026 numbers too. In the second quarter, total sales rose 13.0% reported and 12.2% excluding foreign exchange3. The adjusted figures Abbott guides to exclude the swings, but shareholders are paid in dollars.

Emerging markets add to it. They were 37% of sales in 20254, and their currencies move further and faster than the euro or yen.

Abbott's employees are spread even more widely than its sales: 69% work outside the United States5, so a large part of the cost base is in local currencies.

The first half of 2026 shows the size of the swing. Total sales rose 10.5% reported and 8.2% excluding currency6; Medical Devices rose 11.0% reported and 8.0% excluding currency7. Three points of growth from exchange rates can disappear as easily as they came. Established Pharmaceuticals, sold only abroad, grew 10.7% reported and 8.9% excluding currency in the same half8.

The test is the gap between reported and constant-currency earnings. One bad currency year is weather. Two years of currency cutting operating earnings by more than 3% while lifting sales is a cost base built in the wrong places.

References
  1. ReportedA company that sells 61% abroad carries currency risk in both directions.
    Abbott Laboratories Form 10-K for 2025 (year ended 31 December 2025) - Item 1A risk factors, competition, regulation and legal proceedings. — FY2025 · publ. 20 February 2026 · source ↗
  2. ReportedIn 2025, Abbott says, foreign exchange "favorably impacted net sales and unfavorably impacted operating earnings".
    Abbott Laboratories Form 10-K for 2025 (year ended 31 December 2025) - consolidated financial statements: income, taxes, cash flow, dividends, repurchases, debt, goodwill and the critical accounting policy on rebates. — FY2025 · publ. 20 February 2026 · source ↗
  3. ReportedIn the second quarter, total sales rose 13.0% reported and 12.2% excluding foreign exchange.
    Abbott Laboratories second-quarter 2026 earnings release, Form 8-K exhibit 99.1 - sales by segment and business, comparable growth, income statement, specified items, guidance and the 410th consecutive quarterly dividend - total sales, income statement, specified items, tax rate, guidance and the dividend. — Q2 2026 · publ. 16 July 2026 · source ↗
  4. ReportedThey were 37% of sales in 2025, and their currencies move further and faster than the euro or yen.
    Abbott Laboratories Form 10-K for 2025 (year ended 31 December 2025) - Item 1 business and the segment note: the four segments, sales and operating earnings, employees, manufacturing sites, customers and geography. — FY2025 · publ. 20 February 2026 · source ↗
  5. ReportedAbbott's employees are spread even more widely than its sales: 69% work outside the United States, so a large part of the cost base is in local currencies.
    Abbott Laboratories Form 10-K for 2025 (year ended 31 December 2025) - Item 1 business and the segment note: the four segments, sales and operating earnings, employees, manufacturing sites, customers and geography. — FY2025 · publ. 20 February 2026 · source ↗
  6. ReportedTotal sales rose 10.5% reported and 8.2% excluding currency; Medical Devices rose 11.0% reported and 8.0% excluding currency.
    Abbott Laboratories second-quarter 2026 earnings release, Form 8-K exhibit 99.1 - sales by segment and business, comparable growth, income statement, specified items, guidance and the 410th consecutive quarterly dividend - Medical Devices sales by business, continuous glucose monitors, Amulet and TECTONIC. — Q2 2026 · publ. 16 July 2026 · source ↗
  7. ReportedTotal sales rose 10.5% reported and 8.2% excluding currency; Medical Devices rose 11.0% reported and 8.0% excluding currency.
    Abbott Laboratories second-quarter 2026 earnings release, Form 8-K exhibit 99.1 - sales by segment and business, comparable growth, income statement, specified items, guidance and the 410th consecutive quarterly dividend - Medical Devices sales by business, continuous glucose monitors, Amulet and TECTONIC. — Q2 2026 · publ. 16 July 2026 · source ↗
  8. ReportedEstablished Pharmaceuticals, sold only abroad, grew 10.7% reported and 8.9% excluding currency in the same half.
    Abbott Laboratories second-quarter 2026 earnings release, Form 8-K exhibit 99.1 - sales by segment and business, comparable growth, income statement, specified items, guidance and the 410th consecutive quarterly dividend - Established Pharmaceuticals sales and Key Emerging Markets. — Q2 2026 · publ. 16 July 2026 · source ↗
Sources
Generated October 6, 2026