Key Moments
- Baxter projected 2026 adjusted earnings of $1.85 to $2.05 per share, trailing the $2.25 per-share consensus estimate from analysts.
- Lingering disruption from flooding at the North Cove facility following Hurricane Helene weighed on operations and contributed to a conservative outlook.
- Fourth-quarter adjusted earnings of $0.44 per share missed expectations, while revenue of $2.97 billion exceeded estimates at $2.82 billion.
Profit Outlook Disappoints, Shares Slide Pre-Market
Baxter International Inc forecast annual profit for 2026 that fell short of Wall Street expectations, citing sustained operational pressure from hurricane-related disruptions at a critical manufacturing site. The guidance pushed the company’s shares down 13% in pre-market trading.
The medical products maker guided for 2026 adjusted earnings in a range of $1.85 to $2.05 per share. That compares with analysts’ average projection of $2.25 per share, based on data from LSEG.
“We fully expected management to take a highly conservative stance on the guide, but the combination of the disappointing EPS performance in the quarter and the softer guide is likely to send shares down today,” J.P.Morgan analyst Robbie Marcus said.
Operational Impact from Hurricane-Related Shutdown
Baxter pointed to ongoing effects from the temporary shutdown of its North Cove facility in North Carolina, which was flooded during Hurricane Helene in 2024. The plant supplies 60% of U.S. intravenous fluids and peritoneal dialysis solutions, making it a key component of the company’s manufacturing network.
The company indicated that these disruptions, along with broader operational challenges, are constraining its near-term financial performance and outlook.
Fourth-Quarter Results: Mixed Performance Across Metrics
CEO Andrew Hider acknowledged that the latest quarter fell short of internal goals. “While we delivered sales growth across all segments, our fourth-quarter results did not meet our expectation,” he said.
Baxter reported adjusted profit from continuing operations of $0.44 per share for the fourth quarter, below the analyst consensus of $0.54 per share. However, revenue for the period reached $2.97 billion, surpassing expectations of $2.82 billion.
Segment Performance and One-Time Charges
Sales in Baxter’s largest business – the medical products and therapies unit, which includes IV solutions – rose 6% from the prior year to $1.39 billion in the fourth quarter.
During the same period, the company recorded significant non-cash and tax-related items. Baxter took $485 million in goodwill impairments and established a $330 million valuation allowance against its U.S. deferred tax assets.
| Metric | Fourth Quarter Result | Analyst Expectation |
|---|---|---|
| Adjusted EPS from continuing operations | $0.44 | $0.54 |
| Total revenue | $2.97 billion | $2.82 billion |
| Medical products and therapies unit sales | $1.39 billion | Not provided |
Muted 2026 Sales Growth and Ongoing Headwinds
Looking ahead, Baxter projected flat-to-1% sales growth for 2026. The company characterized this as a subdued outlook that reflects continuing operational headwinds extending beyond the hurricane-related issues at North Cove.
Boardroom Changes Announced
In addition to its financial update, Baxter reported changes to its board of directors. Two directors resigned, and finance executive Michael McDonnell is set to join the board, effective February 13.
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