Abbott Laboratories (ABT) is bracing for the impact of higher tariffs, including a 50% US levy on its Indian imports.
“Our impact between the whole network is just under $200 million,” CEO Robert Ford said on Yahoo Finance’s Opening Bid (video above). “But I think the key thing here, one thing that we have learned, is once tariffs come into place, whether in the United States or in another country, they do not go away.”
Ford added the healthcare company is finding ways to mitigate the tariffs, including making long-term investments in manufacturing and supply chains.
Read more: 5 ways to tariff-proof your finances
The Illinois-based Abbott has about 90 manufacturing sites worldwide, with roughly 40 of those in the US, per Ford. The Trump administration has unleashed a torrent of tariffs, including 50% on India, a major pharmaceutical producer.
“A very large percentage of our US revenue is supported by US manufacturing, and our international revenue is supported by international manufacturing sites,” he said. That strategy helps buffer the company from foreign exchange swings but builds supply chain resilience.
In April, Abbott announced a $500 million investment to boost US manufacturing at two plants in Illinois and Texas. Those sites are expected to be “up and running by the end of the year,” according to Ford.
Earlier this month, the company unveiled plans for a new cardiovascular manufacturing site in Georgia. Prior to that, it said it would build a nutritional products facility in Ohio.
Those expansion plans come as Abbott posted solid second quarter results. It reported revenue of $11.14 billion, topping the $11.07 billion expected, and adjusted earnings per share of $1.26, versus consensus estimates of $1.25, according to Bloomberg data.
Still, tariffs prompted Abbott to adjust its full-year EPS guidance. The company now expects earnings per share of $5.10 to $5.20, a slight revision from the prior estimate of $5.05 to $5.25.
While Abbott’s US investments weren’t driven solely by trade concerns, Ford acknowledged the changing economic backdrop.
“We’ve always had a philosophy to align our demand with our production,” Ford explained. “So it’s really thinking about a much larger context. It’s not necessarily driven by tariffs, but it’s about really aligning our cost structure with our revenue structure.”
Separately, Abbott is trying to address urgent blood shortages in the US, which have fallen to their lowest in decades. The company has partnered with the Big Ten Conference to increase blood donations from students, alumni, and fans.
