Embecta (Nasdaq:EMBC) stock was down today after news of restructuring and mixed second-quarter results.
Shares of EMBC were down more than 8% to $12.12 apiece near the close of trading today.
While the company continues to work through the discontinuation of its insulin patch pump program — the plan for which it says is substantially completed — Embecta still expanded its product portfolio in the quarter. The company received purchase orders to co-package pen needles with potential generic GLP-1 drugs, according to a news release. Additionally, it continued making progress on expanding the availability of appropriately sized GLP-1 retail packaging for use with weekly injection therapies.
However, while Embecta restructures its setup as a result of the patch pump discontinuation, it has initiated a separate restructuring plan. This aims to streamline the organization and optimize resources. The company didn’t disclose if the restructuring will result in another headcount reduction. Neither the New Jersey (where Embecta is headquartered) or Massachusetts (where its last layoffs took place) WARN programs currently list recent actions taken by the company.
For the quarter, the Parsippany, New Jersey–based diabetes technology developer reported profits of $23.5 million. That equals 40¢ per share on sales of $259 million for the three months ended March 31.
Embecta recorded an 18.7% bottom-line slide on a sales decrease of 9.8%.
Adjusted to exclude one-time items, earnings per share came in at 70¢. That landed 11¢ ahead of expectations on Wall Street. Sales came up shy of forecasts, though, as experts projected $261.8 million in revenue.
“This quarter’s financial results were once again slightly ahead of our prior expectations, as our teams executed well, which included driving an acceleration in our free-cash flow generation, thereby allowing us to continue to repay debt and create additional balance sheet flexibility,” said Devdatt (Dev) Kurdikar, president and CEO of Embecta. “In this challenging operating environment, we are raising key profitability metrics while maintaining our prior adjusted earnings per share guidance despite a lowered fiscal year 2025 adjusted constant current revenue guidance range and the impact of incremental tariffs.
“This reflects favorable projected foreign exchange rates, which are allowing us to keep our as-reported revenue guidance range largely unchanged, as well as disciplined operating expense controls and the benefit of our recently announced restructuring program.”
Embecta now expects revenues between $1.073 billion and $1.09 billion. This would mark a sales dip of between 4.4% and 2.9% year-over-year. It’s also a decrease from previous projections for between $1.075 billion and $1.092 billion. Guidance for adjusted EPS remained the same with a range between $2.70 and $2.90.
