Abbott Laboratories (ABT) shares surged nearly 4% in premarket trading on Thursday following the company’s announcement of better-than-expected Q2 earnings and an optimistic reassessment of its full-year profit outlook.

For the second quarter of 2026, Abbott reported an adjusted earnings per share (EPS) of $1.31, exceeding the analyst prediction of $1.28. Total revenue reached $12.59 billion, marking a 13% increase year-over-year and surpassing the consensus estimate of $12.52 billion.

Diagnostics Drive Revenue Growth

A significant contributor to this quarter's success was the diagnostics segment, which saw sales soar by 42% to $3.09 billion, outperforming estimates of $3.02 billion. This marked Abbott's first diagnostics beat in six quarters, largely due to the acquisition of Exact Sciences, which includes cancer screening tests like Cologuard.

Cologuard experienced mid-teens growth, benefiting from an expanding customer base. This performance helped to offset declining revenues from COVID-19 testing, a sector that had previously bolstered sales.

Performance Across Other Segments

In the medical devices category, sales increased by 9% to $5.85 billion, slightly above the anticipated $5.82 billion. Abbott's offerings in electrophysiology and structural heart devices have demonstrated resilience amid industry challenges.

Sales in Diabetes Care, featuring FreeStyle Libre and Lingo CGM products, rose by 10.5% to $2.19 billion. J.P. Morgan analyst Robbie Marcus indicated that the continuous glucose monitoring (CGM) market is stabilizing with growth expected between 8% and 12% moving forward.

On the downside, the nutrition segment faced a 3.1% revenue decline attributed to lower volumes and recent pricing strategies.

Revised Financial Outlook

Abbott has raised its full-year adjusted EPS guidance to between $5.45 and $5.60, up from the previous forecast of $5.38 to $5.58. The company reaffirmed its sales growth guidance of 6.5% to 7.5% for the year.

For the upcoming third quarter, Abbott anticipates an adjusted EPS of $1.38 to $1.46, aligning closely with the analyst estimate of $1.42.

On a generally accepted accounting principles (GAAP) basis, net profit fell to $928 million, or $0.53 per share, compared to $1.78 billion, or $1.01 per share, from the previous year, primarily reflecting acquisition-related costs.

This material is for informational purposes only and is not financial advice.