Baxter International Q2 2025 Earnings Call Transcript: Key Highlights and Financial Outlook

Baxter International reported Q2 2025 earnings, with Chair and Interim CEO Brent Shafer, EVP and CFO Joel Grade, and EVP and COO Heather Knight participating in the conference call. The company discussed its financial outlook for Q3 and FY25, as well as the impact of strategic actions and potential risks. The call was recorded and copyrighted material, and cannot be recorded or rebroadcast without Baxter's permission.

Baxter International Inc. (BAX) reported its Q2 2025 earnings on July 2, 2025, with Chair and Interim CEO Brent Shafer, Executive Vice President and CFO Joel Grade, and Executive Vice President and COO Heather Knight participating in the conference call. The company provided updates on its financial outlook for Q3 and FY25, as well as the impact of strategic actions and potential risks [1].

During the call, Shafer reported that second quarter sales from continuing operations grew 4% on a reported basis and 1% on an operational basis, with growth coming from all three segments. However, he noted that the results were at the low end of the guidance ranges, reflecting softness in demand for certain products within the Medical Products and Therapies and Pharmaceutical segments [1].

The company also announced the appointment of Andrew Hider as the next CEO, emphasizing his track record of value creation, innovation, and transformation [1]. Additionally, Grade provided updated guidance for 2025, stating that Baxter now expects operational sales growth of 3% to 4% for 2025, a reduction from the prior expectations of 4% to 5%. The guidance incorporates risks from the Novum infusion pump pause and ongoing fluid conservation [1].

For the third quarter of 2025, the company expects continuing operations sales growth of approximately 6% to 7% on a reported basis and 3% to 4% on an operational basis. Adjusted earnings per share are projected at $0.58 to $0.62 per share [1].

The company's financial results for the quarter included global sales from continuing operations of $2.8 billion, adjusted earnings per share from continuing operations of $0.59, and adjusted gross margins of 14.7% [1]. The adjusted tax rate was 16.7%, with adjusted SG&A totaling $639 million and adjusted R&D spending at $134 million [1].

During the Q&A session, analysts pressed for clarity on the Novum pause, fluid conservation, and the ability to meet long-term growth targets. Management maintained a cautiously optimistic tone, emphasizing transparency and active risk mitigation [1].

References:
[1] https://investor.baxter.com/investors/events-and-news/default.aspx
[2] https://seekingalpha.com/news/4475749-baxter-lowers-operational-sales-growth-outlook-to-3-percentminus-4-percent-for-2025-amid
[3] https://www.nasdaq.com/articles/baxter-international-trims-fy25-outlook-update