CLAIM #3064 · Abbott Laboratories (ABT) · 2023Q2 earnings call · Jul 19, 2023 · due Dec 31, 2024
“Your point on endpoint costs are true. We are seeing certain input costs come down, certain commodities come down. And if we see that continue throughout -- going into next year, I think we'll have a great opportunity there.”
Robert Ford · CEO
In context
“of those investments, haven't had to make the kind of SG&A or R&D investments to be able to drive this 11.5% or low double-digit top line growth rate. So that's one of the big drivers there. Yes, your question on infant formula, that obviously contributes as the product -- as we're recovering the share and the manufacturing is ramping up again. But it's really a combination of all the areas, right? As the device business grows and grows disproportionately, that has a higher gross margin profile, too. So I'd say it's really across the board on all the businesses. And this is an area of focus that we have. To your question on gross margin, this is our biggest opportunity, I would say, maintaining this kind of growth rate and then looking at areas where we can improve our gross margins. Your point on endpoint costs are true. We are seeing certain input costs come down, certain commodities come down. And if we see that continue throughout -- going into next year, I think we'll have a great opportunity there. One of the things that I wanted to make sure we focused on going into this year was that we had the inventory we needed to be able to capitalize on the opportunities we have from a top line perspective. And if you remember, Jayson, second half of last year, supply chain is really challenged, and we had some challenges, right? And that -- those supply chain challenges had an impact on our top line. So going into this year, we told the team, let's make sure we've got all the inventory we need to capitalize on these opportunities. And one of the ways you do that is you've got to lock in your supply, you've got to lock in your volume, you've got to lock in your price. So as commodities come down and we start to look at our contracts for next year, I think that will be a great opportunity”
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SEC filings for ABT ↗ · Claim quote is verbatim from the 2023Q2 earnings call.