Q3 2024 Earnings Summary
Reported on Jan 4, 2025 (Before Market Open)
Pre-Earnings Price$241.06Last close (Jul 31, 2024)
Post-Earnings Price$227.55Open (Aug 1, 2024)
Price Change
$-13.51(-5.60%)
- BD projects exceeding a 25% adjusted operating margin in FY2025, with the significant majority of improvement coming from gross margin enhancements driven by their BD Excellence initiatives, including manufacturing consolidation and smart factories.
- The company sees strong momentum with the Alaris infusion system, which has returned to market ahead of schedule, achieving historical run rates of over $100 million per quarter, with opportunities to exceed this in FY2025.
- BD is advancing multiple growth drivers beyond Alaris, including the upcoming launch of the next-generation Pyxis medication dispensing system and over 10 new releases in their connected medication management portfolio. Additionally, they are capitalizing on significant opportunities in pharmacy automation, positioning themselves as the largest pharmacy automation robotics company globally, with strong customer interest and double-digit growth prospects.
- Macroeconomic challenges and transitory market dynamics, particularly in China, are impacting BD's revenue growth projections. The company has acknowledged lower revenue guidance due to ongoing issues in China, biosciences, and Pharm Systems, and is taking a conservative stance on the recovery of these markets.
- Ongoing destocking in the Pharmaceutical Systems segment is affecting growth, with uncertainties around the timing of market recovery. Despite strong performance in biologics, the destocking in anticoagulant and vaccine segments is expected to continue impacting revenues into fiscal year 2025.
- Pressure from volume-based procurement (VBP) and anticorruption measures in China may continue to affect BD's performance in that region. The company does not expect China to return to high growth in the near term and is facing price pressures despite increased volumes in certain categories.