Blow to Philips earnings as U.S. cancels ventilator order

Philips (NYSE:PHG) has cut its 2020 earnings outlook after the U.S. government scrapped the bulk of an order for 43,000 ventilators.

It will now deliver just 12,300 hospital ventilators by the end of the year, though a spokesman said he expected Philips will find other buyers for the 30,700 excess devices.

The termination follows a July report by the U.S. Congress House Subcommittee on Economic and Consumer Policy that found the White House had overpaid Philips by at least $500M. The firm denied any profiteering.

Back in July, Philips said that a surge in orders for medical equipment would enable it to achieve an “adjusted EBITA margin improvement” in 2020, but it now expects “to deliver modest comparable sales growth with an adjusted EBITA margin of around the level of last year.”

https://seekingalpha.com/news/3610042-blow-to-philips-earnings-u-s-cancels-ventilator-order