GE HealthCare's shares took a hit on Tuesday after the company posted a decline in revenue during the first quarter.
The medical device company blamed the declines on weaker demand from the Chinese market and fulfillment delays for some of its patient care solutions products. As it deals with these challenges, the company is looking for additional opportunities in servicing the U.S. health system market.
“Our expectation is that we will continue to ramp our revenue growth throughout the year,” said CEO Peter Arduini during the company’s first-quarter earnings call Tuesday. “[With] China, this tends to be a larger portion of our business, so some of the effect that we felt here in the first quarter was directly correlated to that.”
GE HealthCare posted a net income of $374 million or 81 cents per share for the first three months of 2024, which was up from $189 million of 41 cents per share during the same period last year. However, the company reported a 1% decline in revenue.
“China revenue declined low double digits,” said GE HealthCare chief financial officer Jay Saccaro. “Sales in the U.S. and rest of world were flat with prior year results.”
GE Healthcare's shares were trading at $79.43 on Tuesday morning, down 11% from its Monday close of $89.50.
GE HealthCare reported a decline in revenue in three of its four largest product segments. Imaging, the company’s largest segment by share of revenue, was down 1% year-over-year while its second and third largest segments—ultrasound and patient care solutions—each saw revenue declines of 4%.
The medical device company, which was spun off from parent company General Electric in January 2023, reiterated to investors its desire to sell more services to U.S. health system customers as a way to manage the challenges abroad.
GE HealthCare is developing and sells a software subscription service that it said helps providers manage imaging software from different technology vendors. It comes as the radiology sector at large embraces AI and a growing number of established health tech companies are outlining a strategy to connect startups to health systems.
Send us a letter
Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.
