Healthcare product and device company Abbott Laboratories (NYSE: ABT) met Wall Street’s revenue expectations in Q3 2026, with sales up 14.5% year on year to $13.01 billion. Its non-GAAP profit of $1.42 per share was in line with analysts’ consensus estimates.

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"Abbott delivered strong third-quarter results, reflecting balanced growth across our portfolio," said Robert B. Ford, chairman and chief executive officer, Abbott. "With strong performance across multiple businesses and a robust pipeline of innovation, we are well-positioned to deliver sustainable growth in the years ahead."

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

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Regrettably, Abbott Laboratories’s sales grew at a tepid 2.7% compounded annual growth rate over the last five years. This wasn’t a great result, 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 8.2% over the last two years is above its five-year trend, suggesting some bright spots.

This quarter, Abbott Laboratories’s year-on-year revenue growth was 14.5%, and its $13.01 billion of revenue was in line with Wall Street’s estimates.

Looking ahead, sell-side analysts expect revenue to grow 11.5% over the next 12 months, an improvement versus the last two years. This projection is particularly noteworthy for a company of its scale and suggests its newer products and services will spur better top-line performance.

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Adjusted operating margin

Adjusted operating margin is a key measure of profitability. Think of it as net income (the bottom line) excluding the impact of non-recurring expenses, taxes, and interest on debt - metrics less connected to business fundamentals.

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 22.5%.

Analyzing the trend in its profitability, Abbott Laboratories’s adjusted operating margin decreased by 7.1 percentage points over the last five years. The company’s two-year trajectory also shows it failed to get its profitability back to the peak as its margin fell by 2.4 percentage points. This performance was poor no matter how you look at it - it shows its expenses were rising and it couldn’t pass those costs onto its customers.

This quarter, Abbott Laboratories generated an adjusted operating margin profit margin of 10.4%, down 12.5 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 flat EPS over the last five years was below its 2.7% annualized revenue growth. This tells us the company became less profitable on a per-share basis as it expanded due to non-fundamental factors such as interest expenses and taxes.

Diving into the nuances of Abbott Laboratories’s earnings can give us a better understanding of its performance. As we mentioned earlier, Abbott Laboratories’s adjusted operating margin declined by 7.1 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its lower earnings; interest expenses and taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.

In Q3, Abbott Laboratories reported adjusted EPS of $1.42, up from $1.30 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 to grow 10.7% from $5.38 to $5.96.

Key takeaways from Abbott Laboratories’s Q3 results

It was good to see Abbott Laboratories narrowly top analysts’ EPS guidance for next quarter expectations this quarter. Zooming out, we think this was a decent quarter. Investors were likely hoping for more, and shares traded down 4% to $98.60 immediately following the results.

So do we think Abbott Laboratories is an attractive buy at the current price? 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).