Shares of Baxter International Inc. (BAX) climbed approximately 4% to $17.60 in midday trading Thursday, recovering some ground after the medical technology company reported first-quarter earnings and revenue that surpassed Wall Street estimates. The stock’s advance came as a relief to investors who had been bracing for more negative news following a turbulent 2025 marked by profit shortfalls and guidance revisions.
For the quarter ended March 31, Baxter posted adjusted earnings of $0.36 per share on revenue of $2.70 billion, comfortably above the LSEG consensus of $0.31 per share and $2.62 billion in sales. On a GAAP basis, however, the company recorded a loss of $0.03 per share from continuing operations. Reported sales from continuing operations rose 3% year-over-year to $2.7 billion, while organic sales—which exclude currency fluctuations and certain deal-related impacts—declined 1%.
Baxter’s management maintained its full-year 2026 adjusted earnings forecast of $1.85 to $2.05 per share, with reported sales growth expected to range from flat to 1% and organic sales growth essentially flat. The unchanged guidance underscores persistent headwinds that continue to pressure margins, including tariffs, elevated manufacturing costs, and ongoing disruptions related to the Novum IQ large-volume pump (LVP) system.
The Novum IQ LVP pump remains a central concern for investors. Baxter halted shipments and installations of the device earlier this year, and the company’s outlook assumes that pause will continue through the remainder of 2026. Interim CFO Anita Zielinski noted that returns and exchanges during the first quarter were not material, but those costs have been incorporated into the forecast. If regulatory scrutiny intensifies, the resolution process drags on, or customer reactions become more pronounced, both revenue and margins could face renewed pressure.
Baxter’s largest business segment, Medical Products & Therapies, continued to be a drag on results. Reported sales in this division edged up 2%, but organic sales fell 2%, primarily due to weak demand for infusion pumps. In contrast, the Pharmaceuticals segment posted stronger performance, with reported sales rising 7% on gains in drug compounding. Healthcare Systems & Technologies revenue was flat during the quarter.
CEO Andrew Hider described the quarter as meeting the company’s internal expectations and emphasized efforts to “stabilize the business.” He acknowledged that “more work remains” to restore investor confidence after recent turbulence. During the earnings call, Hider also addressed macroeconomic risks, noting that Middle East revenue represents less than 2% of total sales and that Baxter’s exposure to oil prices has diminished following the sale of its kidney-care division. He told analysts that current oil prices appear manageable for the year.
Analysts viewed the results as a modest reprieve rather than a catalyst for a significant turnaround. Evercore ISI’s Vijay Kumar said the stable numbers and reaffirmed outlook should alleviate some concerns about inflation and geopolitical exposure. Citi’s Joanne Wuensch added that investors are likely relieved by the delivery after last year’s series of “misses and guide-downs.”
Baxter’s board approved a quarterly cash dividend of just $0.01 per share, payable July 1 to shareholders of record as of May 29. The minimal payout underscores management’s priority of conserving cash, reducing debt, and stabilizing operations before considering any increase in shareholder returns.
Despite Thursday’s gains, Baxter’s stock remains well below its 2025 highs. The company continues to navigate a challenging environment where margin recovery hinges on resolving the Novum IQ LVP issues and managing external cost pressures. Investors will be watching closely for any developments on the pump front as the year progresses.