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• Revenue: First-quarter 2025 global sales from continuing operations totaled $2.63 billion, increasing 5% on both a reported and operational basis.

• Adjusted Earnings Per Share (EPS): $0.55, exceeding prior guidance of $0.47 to $0.50.

• Gross Margin: Adjusted gross margin from continuing operations was 41.8%, a decrease of 160 basis points compared to the prior year.

• Operating Margin: Adjusted operating margin of 14.9%, improving 260 basis points compared to the prior-year period.

• SG&A Expenses: $608 million or 23.2% of sales, a decrease of 310 basis points from the prior-year period.

• R&D Spending: $138 million, representing 5.3% of sales, an increase of 50 basis points compared to the prior-year period.

• Interest Expense: Net interest expense from continuing operations totaled $64 million, a decrease of $14 million versus the prior-year period.

• Tax Rate: Adjusted tax rate for the quarter was 17.4%.

• Medical Products and Therapies (MPT) Sales: $1.3 billion, increasing 6% in the quarter.

• Healthcare Systems & Technologies (HST) Sales: $704 million, increasing 6%.

• Pharmaceuticals Sales: $581 million, increasing 3%.

• Full-Year 2025 Sales Growth Guidance: 7% to 8% on a reported basis.

• Second-Quarter 2025 Sales Growth Guidance: 4% to 5% on a reported basis.

• Second-Quarter 2025 EPS Guidance: $0.59 to $0.63.

• Warning! GuruFocus has detected 7 Warning Signs with BAX.

Release Date: May 01, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Baxter International Inc (NYSE:BAX) exceeded its first-quarter guidance on both the top and bottom lines, showcasing strong financial performance.

• Sales from continuing operations grew by 5% on both a reported and operational basis, driven by strong performance across all segments.

• The company reported adjusted earnings per share from continuing operations of $0.55, surpassing prior guidance.

• Baxter International Inc (NYSE:BAX) is leveraging its verticalized operating model to enhance agility, focus, and innovation, contributing to profitable growth.

• The Healthcare Systems & Technologies (HST) segment showed significant strength, with a 6% increase in sales, driven by strong order growth and competitive wins.

Negative Points

• The global macroeconomic environment remains volatile, creating uncertainty in the marketplace, which could impact future performance.

• Newly enacted global tariffs and potential future tariffs pose a risk to Baxter International Inc (NYSE:BAX)'s operations and financial results.

• The company faces challenges in mitigating the impact of tariffs, with an estimated net impact of $60 million to $70 million in 2025.

• Adjusted gross margin from continuing operations decreased by 160 basis points compared to the prior year, reflecting higher expenses and other factors.

• The search for a permanent CEO is ongoing, creating potential uncertainty in leadership and strategic direction.