Healthcare product and device company Abbott Laboratories (NYSE: ABT) announced better-than-expected revenue in Q1 CY2026, with sales up 7.8% year on year to $11.16 billion. Its non-GAAP profit of $1.15 per share was in line with analysts’ consensus estimates.

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"Our first-quarter results were aligned with our expectations to start the year," said Robert B. Ford, chairman and chief executive officer, Abbott.

Company Overview

With roots dating back to 1888 when founder Dr. Wallace Abbott began producing precise, dosage-form medications, Abbott Laboratories (NYSE: ABT) develops and sells a diverse range of healthcare products including medical devices, diagnostics, nutrition products, and branded generic pharmaceuticals.

Revenue Growth

Examining a company’s long-term performance can provide clues about its quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Regrettably, Abbott Laboratories’s sales grew at a tepid 3.9% compounded annual growth rate over the last five years. This wasn’t a great result compared to the rest of the healthcare sector, but there are still things to like about Abbott Laboratories.

We at StockStory place the most emphasis on long-term growth, but within healthcare, a half-decade historical view may miss recent innovations or disruptive industry trends. Abbott Laboratories’s annualized revenue growth of 5.8% over the last two years is above its five-year trend, which is encouraging.

This quarter, Abbott Laboratories reported year-on-year revenue growth of 7.8%, and its $11.16 billion of revenue exceeded Wall Street’s estimates by 1.3%.

Looking ahead, sell-side analysts expect revenue to grow 11.1% over the next 12 months, an improvement versus the last two years. This projection is particularly healthy for a company of its scale and suggests its newer products and services will fuel better top-line performance.

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Adjusted Operating Margin

Abbott Laboratories has been an efficient company over the last five years. It was one of the more profitable businesses in the healthcare sector, boasting an average adjusted operating margin of 23.2%.

Looking at the trend in its profitability, Abbott Laboratories’s adjusted operating margin decreased by 6.2 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.

In Q1, Abbott Laboratories generated an adjusted operating margin profit margin of 12%, down 9 percentage points year on year. This contraction shows it was less efficient because its expenses grew faster than its revenue.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Abbott Laboratories’s unimpressive 3.8% annual EPS growth over the last five years aligns with its revenue performance. This tells us it maintained its per-share profitability as it expanded.

In Q1, Abbott Laboratories reported adjusted EPS of $1.15, up from $1.09 in the same quarter last year. This print was close to analysts’ estimates. Over the next 12 months, Wall Street expects Abbott Laboratories’s full-year EPS of $5.21 to grow 8.5%.

Key Takeaways from Abbott Laboratories’s Q1 Results

It was good to see Abbott Laboratories narrowly top analysts’ revenue expectations this quarter. On the other hand, the company lowered full-year EPS guidance. Overall, this print could have been better, and the stock traded down 2.5% to $98.98 immediately after reporting.

So should you invest in Abbott Laboratories right now? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).