GE HealthCare reported a strong Q2 with record orders (11% growth) and backlog, driven by strong demand across imaging and PDX segments, though PCS remained challenged. Management maintained full-year guidance despite inflationary pressures and PCS issues, citing a robust product pipeline and improving operational execution. A strategic review of PCS is underway, and the board reaffirmed its medium-term targets. Order growth was 11% YoY, the highest since the spin, with book-to-bill of 1.15x and record backlog of $23.9B.
GE HealthCare reported a strong Q2 with record orders (11% growth) and backlog, driven by strong demand across imaging and PDX segments, though PCS remained challenged. Management maintained full-year guidance despite inflationary pressures and PCS issues, citing a robust product pipeline and improving operational execution. A strategic review of PCS is underway, and the board reaffirmed its medium-term targets. Order growth was 11% YoY, the highest since the spin, with book-to-bill of 1.15x and record backlog of $23.9B.
Management expressed confidence in strong order growth, new product pipeline, and reaffirmed full-year and medium-term targets despite PCS challenges and inflation.
Reported gross margin was 41.17%, reinforcing the quarter's better-than-guided profitability.
Management emphasized AI-enabled products as a key driver of growth and margin expansion, citing examples like the Vivid Pioneer ultrasound and deep learning CT software upgrades offered as subscriptions. They also highlighted using AI internally to improve productivity and…
Record orders and backlog signal strong demand. Management expressed confidence in strong order growth, new product pipeline, and reaffirmed full-year and medium-term targets despite PCS challenges and inflation.
Management emphasized AI-enabled products as a key driver of growth and margin expansion, citing examples like the Vivid Pioneer ultrasound and deep learning CT software upgrades offered as subscriptions. They also highlighted using AI internally to improve productivity and strengthen the supply chain.
Record orders and backlog signal strong demand. Management expressed confidence in strong order growth, new product pipeline, and reaffirmed full-year and medium-term targets despite PCS challenges and inflation.
Free cash flow decreased due to working capital investments and CapEx to support growth, but management reaffirmed its medium-term target of 90% free cash flow conversion.
Management expressed confidence in strong order growth, new product pipeline, and reaffirmed full-year and medium-term targets despite PCS challenges and inflation.
“current contrast market demand is very close to outpacing total market supply.”
“We had operational fulfillment challenges in the quarter. Short on supply of some critical components, things of that nature.”
| Metric | Period | Range | Midpoint | Status |
|---|---|---|---|---|
| EPS | FY2026 | $4.5–$4.7 | $4.6 | MAINTAINED |
| Op margin | FY2026 | 15.4%–15.7% | 15.55% | MAINTAINED |
| Revenue | FY2026 | 3%–4% | 3.5% | MAINTAINED |
| Revenue | FY2026 Q3 | 3%–4% | 3.5% | GUIDED |