In the company’s third-quarter earnings report released today, Abbott — one of the largest medtech companies in the world — fell shy of Wall Street’s sales expectations, but still reported more than 15% sales growth in Medical Devices.
The company singled out Diabetes Care and its 20.5% growth in the quarter as a significant driver behind the Medical Device business’ success, with CGM sales totaling more than $2 billion.
On the company’s third-quarter earnings call (transcribed by Investing.com), CEO Robert B. Ford noted significant demand for the latest-generation FreeStyle Libre 3 system. Demand last year came in higher than expected with a new planned manufacturing facility in Ireland not yet up and running.
With the site now running, Ford and Abbott expected a more linear recovery, but instead saw another boost for the CGMs.
“Demand is still very, very strong and we’re seeing that,” Ford said. “Next year, I expect to see another strong year of growth in the U.S.”
New dual sensor should spur even more growth for Abbott
Abbott announced that it had a new diabetes-related biowearable under development in June 2023. The dual sensor would be the first to continuously monitor glucose and ketone levels in one device.
While the sensor has yet to hit the market, it began to make waves again three years on from that initial announcement. Abbott recently agreed to implement integrations with automated insulin delivery systems offered by Sequel Med Tech, Tandem Diabetes Care, Beta Bionics, then Ypsomed and CamDiab.
Earlier this year, Abbott EVP of Diabetes Care Chris Scoggins, spoke to Drug Delivery Business News to share the company’s excitement for the latest addition to its portfolio of CGMs and biowearable sensors.
Ford echoed that on the company’s earnings call today.
“With additional demand coming from the new dual analyte sensor, I think that’s going to help drive increasing penetration in that intensive insulin user segment,” Ford said.
Ford expects new product launches to deliver growth for Abbott next year and included the sensor on his list of expected rollouts for 2026.
What about the other user segments?
Ford said that, because of attention on the upcoming dual sensor, Abbott gets a lot of attention on the intensive insulin user segment. But, he remains bullish on the underpenetrated basal insulin segment, as well as type 2 non-insulin dependent users.
He expects CMS coverage for the latter as well, with “positive signs of that developing.” Proposed coverage could come “sometime next year.”
“We’ve got a lot of growth opportunities between patient segments, between the technology being launched, across geographies. I think we’ve got a great portfolio and great lineup as we go into the U.S. next year. But, I also think there’s just tremendous opportunity internationally. That’s an area of particular strength for use where we built the scale, the technology and the cost positions there. I feel good about Libre, our U.S. position and the momentum we’re going to have internationally.
On the basal market, Ford says there’s about 20% market penetration domestically and only 5% abroad. He said the market is difficult to generalize and typically moving at different speeds, but the goal remains to bring CGM to that patient population.
“What’s important for us is that we’re continuing to see an increased sustained penetration,” Ford said. “If I were to sum it up, it’s probably more dependent on us than it is about concerns about whether there’s value or not. I think the clinical data is pretty resounding in terms of the benefits that it has.
“This, for me, is more about us doing better, investing more, covering more physicians and that’s what we’re doing.”
The analysts’ take
BTIG analysts Marie Thibault, Sam Eiber and Alexandra Pang reiterated their “Buy” rating for Abbott, citing Diabetes as a significant reason why.
“We also see opportunities for [Abbott] to outperform through new product introductions in two of its largest markets—Electrophysiology and Diabetes,” the analysts wrote.
The analysts say the dual sensor should support growth in the intensive insulin populations while potential CMS expansion for type 2 non-insulin could be “a catalyst in the outyears” while not assumed in Abbott’s outlook.
“[Abbott] anticipates the strong momentum to continue in 2026, supported by the launch of its dual-analyte sensor next year, which could drive share gains and increased penetration across different patient populations,” the analysts said. “Potential CMS coverage for CGMs for type 2 patients who do not use insulin next year could also help; currently, [Abbott] does not build in any contribution from this potential tailwind in 2026.”
