Philips Revises Profit Outlook Amid Tariff Concerns

Published 6 hours agoPHG

Philips Revises Profit Outlook Amid Tariff Concerns

Philips has announced that it expects a net impact ranging from €250 to €300 million from tariffs due in 2025, even after employing significant measures to lessen the impact. This projection has prompted the Dutch health technology company to adjust its full-year core profit outlook downward, indicating potential financial pressures ahead.

Despite these challenges, Philips reported that its first-quarter sales slightly beat market expectations, a positive note in an otherwise cautious forecast. According to Reuters, the company is estimating a modest growth in comparable sales by 1% to 3% for 2025, while also navigating declining sales in China and the effects of U.S.-China tariffs.

In response to these conditions, Philips has raised its productivity savings target for the 2023-2025 period from €2 billion to €2.5 billion, aiming for €800 million in savings by 2025. Additionally, the company has proposed to maintain its annual dividend at €0.85 per share, aligning with figures from the previous year. This strategy reflects Philips' commitment to balancing growth initiatives with financial sustainability.

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