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⚠ The Libre 3 RecallModerate threat

Abbott Laboratories (ABT) — threat to the moat

A Class I recall of FreeStyle Libre 3 sensors came with 860 serious injuries and seven deaths reported, in the product Abbott's growth depends on most.

The sensor's moat is trust, and in early 2026 the trust was tested. The FDA identified "a Class I recall of certain FreeStyle Libre 3 and FreeStyle Libre 3 Plus Sensors" because of glucose readings lower than actual levels1. Abbott reported 860 serious injuries and seven deaths associated with the problem2.

Abbott CGM sales growth by quarter, organic or comparable (%)19.6Q2 202517.2Q3 202512.2Q4 20257.6Q1 20269.5Q2 2026Abbott Q2 2025-Q2 2026 earnings releases; 2026 comparable basis
Growth fell by half around the recall.

A Class I recall is the FDA's most serious category. For a product whose only job is to give a number the patient acts on, a reading that is wrong in the low direction can lead someone to eat or to skip insulin when they should not. Patients with affected sensors were told to stop using them and throw them away3.

The commercial damage so far is hard to separate from slowing growth. Sensor growth was 12.2% on an organic basis in the fourth quarter of 20254 and 7.6% on a comparable basis in the first quarter of 20265, and an analyst asked on the fourth-quarter call whether Libre had been hit by the recall6.

The financial cost of a recall at this scale is borne by Abbott itself. A product that sold $7.6 billion in 20257 is large enough that even a small loss of patients to a rival costs more than the recall's direct charges.

Abbott does not insure itself against this. Its filings say product liability losses are "self-insured"8. The test is in the next recall notice. A second Class I recall on a Libre sensor within two years would turn one manufacturing failure into a pattern, and comparable sensor growth below 5% would show patients leaving.

References
  1. ReportedThe FDA identified "a Class I recall of certain FreeStyle Libre 3 and FreeStyle Libre 3 Plus Sensors" because of glucose readings lower than actual levels.
    AHA News, 4 February 2026 - FDA identifies a Class I recall of certain FreeStyle Libre 3 and FreeStyle Libre 3 Plus sensors for glucose readings lower than actual; Abbott reported 860 serious injuries and seven deaths. — February 2026 · publ. 4 February 2026 · source ↗
  2. ReportedAbbott reported 860 serious injuries and seven deaths associated with the problem.
    AHA News, 4 February 2026 - FDA identifies a Class I recall of certain FreeStyle Libre 3 and FreeStyle Libre 3 Plus sensors for glucose readings lower than actual; Abbott reported 860 serious injuries and seven deaths. — February 2026 · publ. 4 February 2026 · source ↗
  3. ReportedPatients with affected sensors were told to stop using them and throw them away.
    AHA News, 4 February 2026 - FDA identifies a Class I recall of certain FreeStyle Libre 3 and FreeStyle Libre 3 Plus sensors for glucose readings lower than actual; Abbott reported 860 serious injuries and seven deaths. — February 2026 · publ. 4 February 2026 · source ↗
  4. ReportedSensor growth was 12.2% on an organic basis in the fourth quarter of 2025 and 7.6% on a comparable basis in the first quarter of 2026, and an analyst asked on the fourth-quarter call whether Libre had been hit by the recall.
    Abbott Laboratories fourth-quarter and full-year 2025 earnings release, Form 8-K exhibit 99.1 - fourth-quarter sales by segment, the Nutrition decline and strategic price actions, continuous glucose monitor sales growth, adjusted EPS of $5.15, the Volt PFA approval and 2026 guidance. — FY2025 · publ. 22 January 2026 · source ↗
  5. ReportedSensor growth was 12.2% on an organic basis in the fourth quarter of 2025 and 7.6% on a comparable basis in the first quarter of 2026, and an analyst asked on the fourth-quarter call whether Libre had been hit by the recall.
    Abbott Laboratories first-quarter 2026 earnings release, Form 8-K exhibit 99.1 - continuous glucose monitor sales growth and full-year 2026 guidance including $0.20 of Exact Sciences dilution. — Q1 2026 · publ. 16 April 2026 · source ↗
  6. ReportedSensor growth was 12.2% on an organic basis in the fourth quarter of 2025 and 7.6% on a comparable basis in the first quarter of 2026, and an analyst asked on the fourth-quarter call whether Libre had been hit by the recall.
    Fierce Biotech, 23 January 2026 - Abbott shares down 10% on 22 January 2026 after fourth-quarter 2025 diagnostics and nutrition sales fell. — January 2026 · publ. 23 January 2026 · source ↗
  7. ReportedA product that sold $7.6 billion in 2025 is large enough that even a small loss of patients to a rival costs more than the recall's direct charges.
    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 ↗
  8. ReportedIts filings say product liability losses are "self-insured".
    Abbott Laboratories Form 10-K for 2022 - the February 2022 Sturgis infant formula recall, the 16 May 2022 consent decree, recalled-brand US sales of $479 million against $1.2 billion, $176 million of recall charges, COVID-19 testing sales of $3.9bn, $7.7bn and $8.4bn in 2020-2022, net earnings and EPS for 2020-2022, and the statement that product liability losses are self-insured. — FY2022 · publ. February 2023 · source ↗
Sources
Generated October 6, 2026