CLAIM #3224 · Abbott Laboratories (ABT) · 2024Q4 earnings call · Jan 22, 2025

“That's a little bit more dependent on commodities and freight and distribution, things like that. But I think the teams have got a really good strategy here of kind of working on cost to serve and even, quite frankly, using some pricing where we felt we had to because of some of the increase in those commodities. So I think the Nutrition gross margin is definitely an opportunity that we've got over the next couple of years.”

Robert Ford · CEO

How to check this claim

Look at: Nutrition segment gross margin, reported quarterly/annually

It came true if: Nutrition gross margin higher than Q4 2024/FY2024 reported level, with continued sequential improvement over the next two years (by mid-2026)

Where: Company segment reporting (10-K/10-Q segment disclosures or earnings call commentary on Nutrition margins)

Knowable after: 2026-07-31

In context

“been able to achieve that through our spending and spending efficiencies. But I think that's the right range to have. I mean I think we've always had this notion. I mean, I talked about being able to offset FX and things like that and not provide any surprises. That's part of the algorithm there, which is we're just constantly having to address gross margin. It's not like this initiative either because of inflation or bits of tariffs or anything like that, it's just we're constantly working to improve gross margins. I'd say, on the nutrition side, those gross margins, given what we encountered over the last two years, those came down. But if you look at them, they have been improving sequentially almost like every quarter. We've got a ways to go to get back to where we were in 2022, Josh. That's a little bit more dependent on commodities and freight and distribution, things like that. But I think the teams have got a really good strategy here of kind of working on cost to serve and even, quite frankly, using some pricing where we felt we had to because of some of the increase in those commodities. So I think the Nutrition gross margin is definitely an opportunity that we've got over the next couple of years. The pharmaceutical teams have done an incredible job at maintaining a gross margin under pretty significant FX. I mean they do a fantastic job at offsetting FX. If you look at the margin profile in that business, it's actually increased several -- couple of hundred basis points over the last couple of years. So they've been able to do that also through gross margin. And I think the other element is just ensuring that we keep on driving the med tech business that have accretive gross margins quite frankly, across all of those different business units. And if we can continue to do that, then that's how you get to that model of maybe 50 to 100 basis points every single year. That's our target. We committed to 70, and we deliver to 70, we're now committing to 80 for 2025. And getting us close”

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SEC filings for ABT ↗ · Quote is verbatim from the 2024Q4 earnings call.