GEHC

GE HealthCare Technologies has slipped year to date, yet on broad valuation checks the stock still screens as relatively cheap compared with its fundamentals. Investors are weighing that disconnect against a steady stream of product developments in imaging and cardiology. Year to date, GE HealthCare Technologies is down 14.8%, which may make the current share price more interesting for value focused investors who already follow the company. Progress in advanced imaging such as the Photonova Spectra CT system and connected radiation therapy workflows can support expectations for future revenue, while the risk is that commercial uptake of these newer platforms is slower or more costly than the market currently assumes. On a composite basis the broader checks lean cheap, with the stock scoring 5 out of 6 on value. The issue now is whether GE HealthCare Technologies’ current price already reflects the business outlook or if the high value score suggests more room for long term investors to be compensated for their patience. Spot undervalued medical technology alongside GE HealthCare Technologies by scanning a curated list of 54 high quality undervalued stocks. The P/E ratio is a useful measure for GE HealthCare Technologies because earnings are one of the clearer anchors for valuing a mature medical equipment business. The stock trades on a P/E of 16.1x, which is materially lower than the Medical Equipment industry average of 27.0x and also below the broader peer group on 30.2x. A tailored fair P/E multiple for GE HealthCare Technologies is estimated at 29.2x, which is closer to where peers cluster and significantly above the current 16.1x level. Despite recent product news around imaging and cardiology that could support sentiment, the market still prices GE HealthCare Technologies at a discount to what this model suggests based on its sector, margins and risk profile. On the P/E multiple alone, GE HealthCare Technologies stock appears undervalued compared with both its fair ratio and industry peers. See what the numbers say about this price — find out in our valuation breakdown. Simply Wall St Narratives for GE HealthCare Technologies link the valuation gap to a set of clear scenarios for the company’s future earnings power. These short storylines spell out which combinations of growth, margins and risk would need to occur for GE HealthCare Technologies’ stock to be worth materially more or less than today’s price. Each one also connects its figure to a specific view of how those drivers may change, so you can revisit the logic as new data appears on the Community page. Community views on GE HealthCare Technologies now split between a meaningful upside story and a much more muted, fairly valued setup. Bull case: 14% undervalued Read the full Bull Case to see why GE HealthCare Technologies could be undervalued Bear case: roughly fairly valued Read the full Bear Case to see why GE HealthCare Technologies could be overvalued Do you think there's more to the story for GE HealthCare Technologies? Head over to our Community to see what others are saying! GE HealthCare Technologies screens as undervalued on earnings based multiples, especially against medical equipment peers with higher P/E ratios. That discount lines up with the strong value checks, yet it also reflects real questions about how quickly new imaging and cardiology platforms translate into profitable revenue. For you as an investor, the key question is whether adoption and margins on these systems progress smoothly enough for the market to close that valuation gap, or whether the current discount proves to be the market correctly pricing execution risk. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include GEHC. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

It has been about a month since the last earnings report for GE HealthCare Technologies (GEHC). Shares have added about 3.6% in that time frame, underperforming the S&P 500. But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is GE HealthCare due for a pullback? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for GE HealthCare Technologies Inc. before we dive into how investors and analysts have reacted as of late. GE HealthCare reported second-quarter 2026 adjusted earnings per share of $1.13, which beat the Zacks Consensus Estimate of $1.04 by 8.7%. The bottom line increased 6.6% year over year, aided by commercial execution, pricing and productivity gains. GAAP EPS in the quarter was $1.24, up 16.5% from the year-ago level. Revenues of $5.29 billion increased 5.7% year over year on a reported basis and 3.5% organically. The top line surpassed the Zacks Consensus Estimate by 0.7%. Revenue growth was led by Pharmaceutical Diagnostics (PDx) and Advanced Imaging Solutions (AIS), along with strength in the United States, EMEA and Rest of World markets. However, growth was partially offset by a decline in the Patient Care Solutions (PCS) segment. Total company orders increased 11.1% year over year organically. The book-to-bill ratio was 1.15X, indicating rising orders compared to shipments, with backlog reaching a record $23.9 billion. Management cited order growth across every segment, supported by strong commercial execution and adoption of new products. Pharmaceutical Diagnostics revenues increased 15.6% year over year to $843 million. Growth was supported by higher contrast-media volumes, pricing and U.S. radiopharmaceutical demand. Segment EBIT was $250 million, up 16.9% year over year. Advanced Imaging Solutions revenues increased 7.9% year over year to $3.77 billion. Growth was supported by CardioVascular and Interventional Solutions, computed tomography and Molecular Imaging. Segment EBIT was $525 million, up 15.4% year over year. Patient Care Solutions revenues declined 13.3% year over year to $675 million. Management attributed the decline primarily to operational and fulfillment challenges, despite strong first-half orders that indicated healthy customer demand. Net income margin expanded 90 basis points to 10.6%. However, net income margin was negatively impacted due to PCS weakness and inflation in memory chips, oil and freight costs. Cumulative cash flow from operating activities at the end of the second quarter was $458 million compared with $344 million a year ago. GEHC exited the second quarter with cash, cash equivalents and restricted cash of $2.11 billion compared with $2.28 billion in the previous quarter. Total assets increased to $37.25 billion from $37.12 billion on a sequential basis. GE HealthCare reaffirmed its guidance for 2026. The company still expects organic revenue growth of 3-4% in 2026. It anticipates adjusted earnings per share to be in the range of $4.80-$5.00, implying 4.6%-9.0% year-over-year growth, as expected previously. Management anticipates approximately $250 million of inflation associated with memory chips, oil and freight and other components, but expects pricing and cost actions to offset more than half of that impact. Since the earnings release, investors have witnessed a downward trend in estimates revision. Currently, GE HealthCare has a subpar Growth Score of D, a grade with the same score on the momentum front. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy. Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, GE HealthCare has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months. GE HealthCare is part of the Zacks Medical - Products industry. Over the past month, Abbott (ABT), a stock from the same industry, has gained 5.7%. The company reported its results for the quarter ended June 2026 more than a month ago. Abbott reported revenues of $12.59 billion in the last reported quarter, representing a year-over-year change of +13%. EPS of $1.31 for the same period compares with $1.26 a year ago. Abbott is expected to post earnings of $1.43 per share for the current quarter, representing a year-over-year change of +10%. Over the last 30 days, the Zacks Consensus Estimate has changed +0.2%. The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Abbott. Also, the stock has a VGM Score of B. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report GE HealthCare Technologies Inc. (GEHC) : Free Stock Analysis Report Abbott Laboratories (ABT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Wednesday, July 29, 2026 at 8:30 a.m. ET Chief Investor Relations Officer - Carolynne Borders President and Chief Executive Officer - Peter Arduini Vice President and Chief Financial Officer - Jay Saccaro Controller and Chief Accounting Officer - George Newcomb Operator: Good day, and thank you for standing by. Welcome to the GE Healthcare Second Quarter 2026 Earnings Conference Call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Carolynne Borders, Chief Investor Relations Officer. Ma'am, please go ahead. Carolynne Borders: Thanks, operator. Good morning, and welcome to GE Healthcare's second quarter 2026 earnings call. I'm joined by our President and CEO, Peter Arduini; Vice President and CFO, Jay Saccaro; and our Controller and Chief Accounting Officer, George Newcomb. Our conference call remarks will include both GAAP and non-GAAP financial results. Reconciliations between GAAP and non-GAAP measures can be found in today's press release and in the presentation slides available on our website. During this call, we'll make forward-looking statements about our performance. These statements are based on how we see things today. As described in our SEC filings, actual results may differ materially due to risks and uncertainties. And with that, I'll hand the call over to Peter. Peter Arduini: Thanks, Carolynne. Good morning, and thank you for joining us today. We were pleased with our strong performance in the second quarter. Orders increased 11% with strong backlog, which grew $2.6 billion year-over-year and book-to-bill of 1.15x, all of which were at record levels. We're seeing healthy end market demand in all 3 of our segments and across geographies, reflected in the growth of our differentiated products and solutions that improve clinical outcomes and productivity. This sentiment was once again reflected in our most recent survey of top U.S. customers. We're increasingly becoming a key productivity enabler for our customers as they navigate capacity constraints and workflow challenges. At the same time, the substantial changes that we've made in our commercial organizations and progress on our new innovations, many of which are AI-enabled, strengthen our competitive position and are delivering results. We've launched several new products from our pipeline with more to come, and these products position us well to contribute meaningfully through the balance of the year and beyond. We're also seeing continued traction in our service businesses, strengthening our recurring revenue base and creating additional value for customers. Fundamentally, it's the sum of all of these parts that gives us confidence in the remainder of the year and our medium-term outlook. Revenue growth in the quarter was led by strength in pharmaceutical diagnostics and advanced imaging solutions. Patient Care Solutions performance remained challenged. We're actioning improvement initiatives via our business system Heartbeat with a focus on increasing shipment velocity and backlog conversion of our monitoring and anesthesia product lines to deliver PCS revenue and margin improvement in the second half. A bright spot in the quarter was strong PCS orders growth, particularly in monitoring, driven by our new platforms and recent sales force realignment. As we focus on accelerating recovery in this business, a comprehensive review of the strategic options is underway to determine the best path to maximize long-term growth and value, including continued ownership, a sale and other value-enhancing transactions. This is a business with depth and breadth that touches many areas within health systems. We have a healthy pipeline of new products in anesthesia and monitoring as well as digital offerings expected to be introduced this year and in 2027. Moving to Slide 4. Let's look at how we're delivering on our growth strategy, starting with how we enable precision care. D3 brings together smart devices and drugs, a disease state focus and digital capabilities, particularly AI. Heartbeat helps us align customer needs, product development, sales and service capabilities more effectively. And together, they help us bring innovative products to market faster and strengthen customer relationships while improving the margin profile of the portfolio over time. Our D3 strategy is resonating with customers and their interest in our differentiated solutions is reflected in our strong orders growth in the quarter, including broad-based contributions from ultrasound, MR, CT, patient monitoring, radiopharmaceuticals and interventional labs, among others. This aligns to the global demand backdrop we're seeing for our technologies and underscores how our differentiated innovations and field teams are winning in the market. In the U.S., we're seeing strong interest in Photonova Spectra, our photon-counting CT platform, and we expect CE marking in the second half of 2026, which will expand our opportunity in Europe. We've also received great customer feedback on True Definition DL, our latest deep learning CT software upgrade that enables nearly double the image resolution across the installed base. Like Air Recon DL, this is another good example of how we are using AI to enhance the clinical value of existing systems while giving customers another pathway to enhance performance. We also offer this as a subscription model, which brings recurring revenue. Together, these innovations highlight how we're expanding the value of our CT portfolio through new products and software innovations that appeal to customers. In PDx, we had a strong quarter in contrast media and robust growth in U.S. radiopharmaceuticals. This reflects the growing demand for advanced imaging that requires the breadth of our PDx portfolio. As an example, Vizamyl, our amyloid PET imaging agent, had strong double-digit revenue growth in the quarter, reflecting an increase in therapy adoption and an evolving Alzheimer's [ Eco-Care ] system, which includes broader diagnostic capabilities to identify and evaluate at-risk patients. Additionally, we are on track with our Flyrcado ramp. In the quarter, we delivered 545 doses for the week ending July 24. This is approximately a 40% increase over April levels. We onboarded more customers this quarter, which we expect will lead to increased utilization in the second half of the year. Customer feedback and acceptance remains strong. Looking to the second half, we remain focused on continuing to build momentum and these important indicators of our long-term growth trajectory. We remain confident in our medium-term target of $500 million or more in annual revenues by 2028. Moving to business optimization. We continue to prioritize additional cost and price actions as we navigate a dynamic macro environment. We lead the industry in bringing AI to customers, and we're also equally focused on using AI inside the company to improve productivity, simplify work and strengthen our supply chain so teams can spend more time on activities that create the greatest value for our customers. Since implementing the operational changes to create AIS in Global Markets, we have significantly increased our customer focus with channel changes that were completed in the second quarter. The AIS structure allows us to be a more nimble and agile organization. Before I turn the call over to Jay to review our financial results, I'd like to take a moment to thank him for his partnership and contributions to GE Healthcare over the past 3 years. Jay has helped build a strong financial organization and still greater financial discipline across the company and has been an important partner as we've executed our strategy. We're grateful for his leadership and impact that he's had on the business, and we wish you all the best in your next endeavor. During this transition, I have full confidence in George Newcomb, our incoming interim CFO, who has extensive experience. With that, I'll turn the call over to Jay to review our financial results. Jay? James Saccaro: Thanks, Pete. I really appreciate the partnership, and it's been a privilege to work alongside you in such a talented organization. I'm also proud of all that we've accomplished together, and I have great confidence in the team and the strong foundation we've built to continue executing on the strategy, delivering for patients, customers and shareholders. With that, I'll turn to our second quarter financial performance on Slide 5. We delivered revenue of $5.3 billion, representing 3.5% organic growth year-over-year, in line with our expectations. On a reported basis, we saw revenue growth across all regions. We had solid performance in product and service revenues at 4.7% and 7.7% growth, respectively. Service growth benefited from operational performance as well as contributions from the recent Intelerad acquisition. Organic orders growth was robust, up 11.1% year-over-year, the highest since our spin. We saw orders growth across all of our segments, with particular strength in several of our longer-cycle products in radiology, which represents our former imaging business. These products have longer sales conversion cycles, and we expect these orders to contribute to revenue more meaningfully in 2027. Book-to-bill was 1.15x, also our highest since the spin, and we exited the quarter with a record backlog of $23.9 billion, up $2.6 billion year-over-year and $2.1 billion sequentially. Approximately 1/4 of the sequential increase is in product backlog, while the balance relates to multiyear service agreements that convert to revenue over time. Adjusted EBIT of $750 million included $23 million in recognized refunds from IEEPA tariffs incurred in the first quarter of 2026. Adjusted EBIT margin of 14.2% was down 40 basis points year-over-year. We delivered adjusted EPS of $1.13 in the quarter, up 6.6% year-over-year. Adjusted EPS benefited from $0.04 of tariff refunds and $0.02 due to a lower tax rate year-over-year. Even when adjusting for these contributions, performance exceeded our expectations. Lastly, our free cash flow was $68 million in the quarter, which includes tariff refunds of $107 million. For this quarter, given macro dynamics, we thought it would be helpful to include additional details on our margin performance on Slide 6. Adjusted EBIT margin was 14.2%, down 40 basis points year-over-year. Let's walk through the drivers. First, year-over-year margin was negatively impacted by the challenging quarter in PCS as well as incremental inflationary costs from memory chips, oil and freight and other components. Despite these challenges, strong commercial execution drove volume growth, providing a margin tailwind year-over-year. Heartbeat is helping us better connect our product and commercial teams as we bring our latest innovations to market, supporting both growth and margin expansion. A great example is our Vivid Pioneer ultrasound, which leverages a platform approach to achieve a lower manufactured cost, coupled with differentiated AI capabilities that drive higher pricing. This product is performing better than we expected and has allowed us to deliver a significantly higher gross margin than the prior platform. This development model is replicated across all of our products in our new wave of innovation. Meanwhile, we're focusing on daily management to enable incremental price and cost actions to help offset inflation impacts in 2026. We started to see these improvements take hold in the second quarter and expect this to contribute more meaningfully to margin in the second half of the year and in 2027, even net of investments that we continue to make in the business. Lastly, the year-over-year impact of tariffs was neutral when including the benefit of refunds. Let's move to segment performance, starting with Advanced Imaging Solutions on Slide 7. As a reminder, this is our first quarter reporting the combined business that were formerly known as Imaging and Advanced Visualization Solutions, and we are providing a recast of prior period financials on our website. Organic revenue grew 5% year-over-year, driven by strength in Cardiovascular and Interventional Solutions, CT and Molecular Imaging. EBIT margin increased 90 basis points year-over-year, driven by volume and price, partially offset by inflation. We expect the combination of higher-margin AI-enabled NPIs like those in MR and CT, along with elevated clinical and commercial expertise to continue to drive growth. Moving to Pharmaceutical Diagnostics on Slide 8. We delivered particularly strong organic revenue growth of 14.6%, with strong volume and pricing in contrast media as well as robust growth in our U.S. radiopharmaceutical business. This was driven by increased adoption of disease-specific tracers across the portfolio. EBIT margin of 29.6% grew 30 basis points year-over-year, benefiting from volume and price, partially offset by planned investments in new products and our innovation pipeline. For example, we're making progress in our ongoing Phase II and III clinical trial for a non-gadolinium-based contrast agent, which we believe has the potential to significantly advance the MR contrast landscape. Looking ahead, we continue to expect growth driven by global contrast demand and scaling of our U.S. radiopharmaceutical business. As a reminder, current market demand is close to outpacing total market supply. We're a leader in contrast media where we win through our focus on supply chain resiliency and delivering the diversity of SKUs our customers require. Moving to Patient Care Solutions on Slide 9. Organic revenue declined 13.5% and segment EBIT was negative. We had operational fulfillment challenges in the quarter. As Pete mentioned, we've implemented several changes to strengthen supply and manufacturing capabilities that will address these issues. We expect to see supply improvement, which will benefit both sales and margin in the second half of the year. July has started well in this regard. On a positive note, PCS had strong first half orders growth, driven by monitoring as well as demand for our premium anesthesia product internationally. Backlog is well positioned. And in the second half of the year, we expect to deliver sequential improvement driven by daily focus and weekly execution plans to drive volume and margin recovery. We expect FDA clearance for our premium anesthesia device in the second half of 2026. As we reflect on overall results in the quarter, while PCS continued to be challenged, we're very pleased with the performance in the remainder of our business. Turning to cash on Slide 10. We delivered free cash flow of $68 million. Year-over-year cash flow increased primarily due to tariff refunds, partially offset by working capital investments and CapEx to support growth. We returned capital to shareholders through the repurchase of approximately $200 million worth of shares and continue to pay a dividend. I'll now turn the call back over to Pete to talk more about the full year outlook. Pete? Peter Arduini: Thanks, Jay. As noted throughout the call, we're pleased with the momentum in our business, reflecting healthy end market demand and continued commercial execution, which gives us confidence in our full year outlook. We're maintaining full year guidance, and this reflects 3% to 4% organic sales growth and 10 to 40 basis points adjusted EBIT margin expansion that gets us to a range of 15.4% to 15.7%. We're maintaining our adjusted EPS guidance in the range of $4.80 to $5. Approximately, we expect year-over-year organic revenue growth to be in the range of 3% to 4% as well as low double-digit adjusted EPS growth year-over-year. Now I'll turn to Slide 12, which highlights the strategic value of creating AIS and how our team, our differentiated portfolio and these unique advantages are advancing our growth strategy. We're in the early stages of our new wave of innovation, which is already driving strong results as reflected in our orders growth in the quarter, while also delivering higher gross margins as these products scale. Today, we have stronger commercial alignment with our customers, which includes 3 areas that we hear differentiate GE Healthcare. One, deeper clinical expertise. Our field teams with their business alignment create an agile team of experts able to address clinical and technical challenges. Two, our expanded service capabilities, which includes equipment maintenance and also a growing set of SaaS and software AI-enabled offerings brings a broad toolkit to customers; and three, GE Healthcare brings enterprise problem solving to all levels in the integrated delivery network globally. We hear from customers that our teams are collaborative, creative and relentlessly focused on helping them solve their toughest challenges. These 3 areas allow us to get closer to our customers and help them solve increasingly complex clinical and operational challenges. Lastly, Heartbeat strengthens how we execute. It enables repeatable processes and a culture of accountability and connects our teams more closely with customers. While we're still early in our Heartbeat journey, we're already seeing the benefits a global business system can bring. This focus is helping us win opportunities with leading institutions like the examples you'll see on the next slide. Catholic Health in New York wanted to expand their structural heart and electrophysiology programs and improve productivity and consistency across care settings. Working with their team, we jointly built a road map for technology modernization and services support to address their needs. This includes our latest cardiovascular ultrasound Vivid Pioneer, our interventional platform, Allia and comprehensive digital tools to create a disease state integrated solution, which strengthens Catholic Health's position in the market. Technology was an enabler, not a starting point. The result was an approximately $500 million agreement for equipment, service and process expertise that will result in orders over time. We saw a similar dynamic with the University Hospital Essen in Germany, where the focus was oncology and theranostics. By aligning technology goals and targeted outcomes, we work together to provide a fully integrated nuclear medicine solution that includes cyclotrons for tracer production, our new Total Body PET and SPECT/CT systems and MIM software for AI-enabled imaging analysis and therapy planning. These 2 examples show how we bring together our portfolio around disease states, not just products, underscoring the value of D3 and Heartbeat to deliver for customers. In summary, we've made meaningful progress with our innovation pipeline. New products are gaining traction. Our commercial changes are demonstrating results and our recent customer agreements show how those innovations are being pulled into larger long-term relationships. I'm proud of the AIS and PDx teams for their performance in the quarter. Combined, these 2 businesses grew approximately 6.5% and expanded margin 100 basis points year-over-year. We remain confident in the fundamentals of our business, and I'm proud of our team's commitment to delivering value for patients and customers worldwide. With that, we'll open up the call for Q&A. Carolynne Borders: Operator, we'll go ahead and take questions. Operator, can you please open the line? Operator: Our first question will come from the line of Larry Biegelsen with Wells Fargo. Larry Biegelsen: Jay, it was a pleasure working with you, and I wish you nothing but the best of luck going forward. So for my first question, Pete, I'd love to hear more color on what drove the strength in orders in Q2. Was there anything one-time? And how sustainable is that? And you know there are concerns around capital equipment demand in the U.S. given the ACA subsidy cuts. What are you seeing? Peter Arduini: Yes, Larry, thanks for the question. Look, I mean, we were delighted with our orders performance in the quarter. I would say, look, I mean, 11% is an outstanding number. We've always talked about that being in the mid-single-digit range with orders is quite critical. I think we feel good about that as we go into the second half as well. And that converts that mid-single digit to mid-single-digit revenue, again, which is aligned to our guide. So this is quite good. There really weren't any particular one-timers or any type of business coming in from Q3. It was just really good execution at a street level with our teams with the vast majority of it being our legacy portfolio. That complemented with some of the new products helping to deliver. And then as we've done and I highlighted the addition of enterprise accounts. I think we had about 6 enterprise accounts that contributed to some of the growth. But again, there weren't any items that were significantly big ones that were outliers. It was broad-based, and it was pretty consistent. I think if you look across molecular imaging, ultrasound, MR, CT, our vascular labs, the ultrasound whole portfolio, we talk a lot about cardiac, but point of care, general, women's health, everyone did well. And I would say there's been a lot of focus by our teams on how we execute. So we talk a lot about Heartbeat and the management system, but some of those things get down to how do we improve visibility. And we improve visibility, meaning what deals we see to participate around the world in by a couple of points this quarter. That translated into a couple of points of higher win rate. And those are some of the actions that you can't always execute each quarter on, but it came together quite well. So that's the broader level of it. And again, relative to a beat on the orders, that's the way we'd like to see it. It was broad-based and consistent across the board. The other aspect, I think you mentioned was how the markets are doing. From a procedure standpoint, I know there's been various news in the marketplace. Our best procedures view is really how PDx is doing and then actually how we would see some of the equipment that goes into procedure-based areas like cath labs. Both of those are doing very well. Our contrast agent business is doing extremely well. You heard that Jay mention about the performance of the numbers, both radiopharma as well as in contrast. And so that's a procedure based. And then in our vascular and surgical businesses, both represent vascular procedures, ortho procedures, cardiac, all of those continue to do well. And we haven't really seen any pullback from surveys that we've done out there. I would remind you, though, that we are a type of business that when any type of challenge comes to the hospital, the ability to have an imaging study that can get to a diagnosis very quickly and move a patient on to the right type of therapy and be able to get them out of the system healthy we typically see an uptick. And in many cases, with large deals, that's a big part of the discussion. What can we do to improve their overall productivity. So thanks for the question. Larry Biegelsen: That's very helpful. And just for my follow-up, Pete, we heard the Q3 guidance that you gave. The comps get tougher in the second half. Help bridge the second half implied acceleration on a comp-adjusted basis embedded in the guidance. What are the drivers? James Saccaro: Sure, Larry. Maybe I'll start on this one. I think a lot of this comes down to the robust orders performance that Pete talked to, 11% on a quarter basis. If you look at it on a 2-year stack, over 7% order growth, it really sets us up well heading into the second half. As we think about the first half to second half split over the last few years, we've seen roughly 48% of our revenue in the first half and 52% in the second half. Our 2026 outlook is basically in line with this historic trend. And as we look into the third quarter, one of the areas that we analyze is the thing called secured rate, how secure is the equipment revenue heading into the quarter. And our secured rate on equipment, we're about over 80%, nearly 85% secured entering the quarter, which is up several percentage points versus prior quarters. So we feel very good about that forecast. Also supporting the second half growth will be PCS stabilization. We'll see a bit of that and Flyrcado growth and more broadly, radiopharmaceutical growth as well. So really, those are the contributors to the second half, which we feel very solid about at this point in the quarter. And from a bottom line standpoint, look, our seasonality is such that we have more profit in the second half than the first half, we typically do. Historically, it's 55% roughly in the second half, 45% in the first half. And historically, we see from the first half to second half, about 2.5 percentage points of margin improvement. Now interestingly, we'll do a little bit better than that this year. And what it's going to come down to is really all the price and cost actions that we implemented in the second quarter that will carry us through into the second half, driving us over 300 basis points of expansion from the first half to the second half, with the other notable point being the new products that are coming in that are higher margins really help the mix as we approach the second half. So really, that's the story of the first half versus the second half, Larry. Operator: Our next question is going to come from the line of Vijay Kumar with Evercore ISI. Vijay Kumar: Pete, maybe my first one for you on the Pharma Diagnostics, another solid mid-teens. You gave the Flyrcado numbers. Can you just talk about what's driving it? It looks like the base business ex-Flyrcado is doing really well. What's driving that? And how are we thinking about Flyrcado ramp? Are we still good for the $0.5 billion number? Maybe time lines are moving here? Peter Arduini: Yes, Vijay, thanks for the question. Maybe I'll start at PDx and just kind of flow down through it to that point. So again, we did have a very strong quarter, and it was contrast and it was broad-based in radiopharma. And again, I think this is right on pace to many of the trends that we're seeing out there. We've said in the past, we expect the business to grow high single-digit range. I think that's kind of the expectation. This was obviously a little bit higher performance within the given quarter. But it was a broad-based. I think I mentioned Vizamyl, that was up significantly. And again, it's highly tied to the amyloid beta therapy adoption doing well there. Our product DaTscan for Parkinson's disease was up quite a bit, Cerianna in breast cancer. And then obviously, Flyrcado is kind of our premier product within that area, and we're pleased with the progress. I think this won't obviously be linear. There's going to be bigger spikes at different points in time. But at this point, the 545 doses, which again is about 40% increase -- the other aspect I mentioned on -- in the prepared remarks was the fact that we brought on quite a few new customers as well, pretty much about that same ratio. And they will -- when you bring them on, I think we've talked about this in the past, first 60 days, they're minimally productive. And then past that, they start increasing the amount of doses. And so we're in a really good spot here to ramp this up as we go into Q3 and Q4. The longer-term opportunity of $0.5 billion annually by 2028 is fully intact. I mean, again, remind people, if you think of the perfusion studies that are out there in the pet world, you get about 10% of those studies overall. That's roughly about $500 million in revenue. So we think we -- as we've always talked about, we have much -- a very good chance to do better than that, but we're focused on the $0.5 billion here by 2028. Vijay Kumar: That's very helpful, Pete. Jay, one for you. Look, there's never an ideal time for transition. It seemed a bit abrupt for us. Maybe talk about why now and where are we in the CFO search process? James Saccaro: Vijay, obviously, it's very difficult to leave. We've made such tremendous progress at the company on the innovation pipeline, really setting up processes, establishing the Heartbeat operating system. I feel so good about where the business currently sits and where it's heading. And so makes it very hard to leave. Also, the partnership with Pete and our leadership team has been a remarkable one. I have nothing but respect for that team. And I believe we have a world-class finance function that I've been privileged to work with. So all of that makes it difficult. For me, what this came down to is a very unique opportunity at a great company to expand my role beyond finance. So that's what really this came down to. It's never an opportune time. But what I would say is I really do believe we've put the building blocks in place that have set the company up going forward in the right direction. Pete, maybe you could talk a little bit about the search. Peter Arduini: Yes, I'll take the search. I mean, obviously, Vijay, we just kicked it off. We're going to move quite quickly as we dig into it. I think we're blessed with our market recognition, people understanding what we're doing with AI, how we're in the interesting seat to transform healthcare. So we've got a lot of interest that's out there. And so I would expect we'll be able to talk more about it here in the coming months about how we're making progress against it. In the meantime, George, who's been with us over 38 years in many different roles, deeply involved in all of our operations over the past years, at least since I've been here and beyond, is going to be a great partner here for me. Operator: Our next question comes from the line of Rick Wise with Stifel. Frederick Wise: Pete, a question for you and then a question for Jay. You obviously talked about the new wave of innovation. And stepping back, just are you seeing the impact from that wave of innovation broadly speaking? Is that broadly at a higher level, we're seeing drive orders? Should we expect to see that broad portfolio drive accelerated order growth as you look ahead for the next several years? How are you thinking about it? And most specifically, talk about the impact that having Photonova Spectra now launched is having broadly on the full portfolio pull-through? Peter Arduini: Yes, Rick, thanks for the question. Again, I think particularly if you look at this quarter, we really had all the things kind of come together. I mean we've had some growth here from some of the new products. But again, in the spectrum of all the products that we've talked about, it's still under 20% of the value, meaning it's still a smaller contributor. I'll talk about Photonova in a minute, but Photonova was a minimal contributor to the orders book. That's all still in front of us. What really drove CT was our breadth of our core product line. So you've got really good products that we've been able to raise some level of price, fair amount of price on them and new products that actually have better cost positions and slightly higher price. That's in that book. But I think some of these changes we just talked about, we mentioned Global Markets and AIS, our ability to actually just execute better in front of the customer to be able to describe why us versus someone else, be able to focus on their problem and how to bring our products together to solve their problems. We've been focused on this quite a bit. And so that's a rising impact, and I give a lot of credit to our field teams, both sales and service for that aspect of it. And then the piece relative to enterprise, there are more and more enterprise deals increasing. But I mean, just to get -- put in perspective, I talked about Catholic Health, which is a great partner. Only about 1/5 of those orders are actually a part of what went in the second quarter. So there's still much in front of us. So it was broad-based and consistent. And then I think when you look at MR, MR is an area for us that we have talked about investing in to increase margins. We talked about increasing and changing the profile. The team has done quite well, the Bolt 3T, the new fully integrated user experience, which we updated just a few months ago. It's the first change in probably 25 years in our MR platform, widely viewed as probably the best UI now in the marketplace, making a big difference. The whole portfolio that's playing out in molecular imaging, our PET platform, what's happening there doing well. PCS, as we mentioned, actually on the orders front, actually doing quite well with monitoring for the new platforms that are out there. And then in the AI and specifically in ultrasound and interventional, we're doing very well. And those products, as Phil mentioned as well, have a faster turn. So they will contribute more to a revenue conversion in the second half. The traditional imaging products will be probably more so early in 2027, mainly because they have a room build-out. But we're in very good shape there. And to your Photonova question, things are on track. I had mentioned we need CE marking. That's going to be in the second half of the year. It's a little bit later than we initially communicated, but all in good shape there. We had really very good step-ups in the funnel. I mean this is preorder, but this is prospects that were qualified and ready to step into an order phase. So we're in quite good shape there. And again, that will be a significant growth driver here as we get late to this year and into next year. And so at this point in time, it's not a major driver within the orders book, but will be in the future. Frederick Wise: Got you. And Jay, wishing you all the best in your next job, new role. But you're leaving Pete, you're leaving your successor and you're leaving us with the medium-term '26, '28 outlook goals and targets, the mid-single-digit organic growth, high teens to 20% adjusted EBIT margin, high single-digit to low double-digit EPS growth, 90% free cash flow conversion. Sorry to recite it all, but what's your comfort as you're leaving, or Pete, what's your comfort with the medium-term targets now? Peter Arduini: So Rick, while we're here live, I'll let Jay here as -- make his comment, and then I'll jump in. Jay, maybe you want to hit it quickly. James Saccaro: Yes. Rick, we feel very good about the midterm story. And for us, what we always knew was that the midterm story would be unlocked by 2 things: One, the innovation cycle, and I'm so proud that we've been able to deliver on this. And now it's about executing commercialization that's going to drive that. And two is implementation of an operating system. We call it Heartbeat to drive rigor around commercial and the operational aspects of what we need to do. And so those 2 ingredients are going to be the things that unlock this midterm story. And I have to say both have been put in place and serve as an incredibly solid foundation. Pete? Peter Arduini: Yes. No, look, I think, Rick, we feel quite bullish about where we stand with our midterm targets. Jay hit it. I mean, look, it all starts with do you have the right demand in the marketplace? Which is matched up with the right sales and service teams, but it comes with the right products. We believe we've got the right portfolio coming out. And that portfolio is yet to really deliver the type of results. I just mentioned the Photonova ramp that we expect. All of those products have the opportunity for higher price. There's not been one product that we introduced that hasn't come out at a higher value than its predicate and customers are willing to pay for it. Why? Because it has a lot of embedded features that makes them more productive, whether they're AI or just how they're built into it. And we've leveraged this platform approach where we've been able to come up with, I think, better reliability, but also better cost because of the reuse and leverage of different chassis. So the combination of those is faster growth and better gross margin. So there's a big chunk there. Jay hit on Heartbeat, which, again, I think you're going to hear more and more about what that does for consistency and better execution. And then this point I made on the prepared remarks about AI inside, we see a significant opportunity to increase our own productivity with the use of AI inside so that as we grow, we can grow with a lower G&A based on a higher base. And a lot of that is with the use of agents and tools that can help us be more consistent. So we're locked in. We feel very good about our midterm targets. And honestly, this was a great quarter here to demonstrate that we're well positioned to deliver on it. Operator: Our next question will come from the line of Travis Steed with BofA Securities. Travis Steed: Jay, we'll miss working with you and best of luck in your new role. I wanted to ask about inflation impact on margins. Anything you'd kind of call out or quantify this quarter. If you look at the different buckets you gave last quarter, memory, oil and [ all-in ] freight costs and other inflation buckets, how those are trending versus 3 months ago and how you kind of think about the go-forward there? James Saccaro: So yes, overall, from an inflation standpoint, what I would say is we saw a very volatile macro environment to start the year. We had the memory chip phenomena. We had the war in the Middle East impact logistics and freight in certain other metals. But -- so last quarter, we had to take an approach to adjust the guidance. What I would say is since then, things are broadly speaking, tracking in line with our expectations. Memory chips have continued to increase, but much more modestly. So we're seeing -- we've seen a little bit of increase since the first quarter call, but nothing notable. And oil, while it remains elevated, it is down a bit from the previous peak. And so the $250 million assumption, which included some cushion in it when we put it together is still the appropriate amount for where we sit today. In the second quarter, inflation was about 120 basis point headwind, which was in line with our expectations. And I think for me, the most important aspect is in conjunction with that gross inflation, we put in place a series of mechanisms to offset it, both in terms of cost and price. And we've made really good progress on both of those initiatives, which will support growth into the second half of the year, but then also into 2027. Travis Steed: Great. And then kind of follow-up on the PCS business and the decline this quarter, any more color you'd give on that and when that business starts to stabilize? And then the PCS strategic review, how that's tracking and what you do with extra cash if you got cash from that strategic review? Peter Arduini: Yes, Travis, thanks for the question. Look, I think, again, the first bright spot on PCS was we saw orders growth, particularly in the monitoring world that hasn't performed at that level in quite some months. That's heavily tied to, I think we refocused the sales organization in the quarter that was completed as well as some of the new products. So that's a super important point that needs to be out there. But the reality of it is, look, we had operational fulfillment challenges in the quarter. What do those mean? Short on supply of some critical components, things of that nature. Ultimately, that results in our inability to fulfill. Some of those specific orders, obviously, will move out into the second half. We feel good at this point in time with the new focus that the team has in place that we'll be able to fulfill those and correct those. But ultimately, it's about shoring up our supply chain and our ability to deliver consistency and consistently. And so Jeannette and the team have a daily, weekly focus on this. I'd say we've really got into the details to be able to get the business aligned and feel good about what we can do to be able to address those. As we mentioned as well, I will expect that we will see improvement here within the second half quarter-over-quarter, I think both on top line and bottom line. This is a business that is heavily tied to its volume from its profitability standpoint. So as we move velocity, particularly in monitoring anesthesia through those facilities, you'll see the corresponding profit increase. Look, on the strategic review, Travis, to your question, you would expect us to be taking a look at this business in many different ways to say, how do we have this be a contributor, whether it's a contributor for us or someone else that needs to be addressed. That's job one. And again, I think over the coming quarters, the efforts that we have to improve its profitability, improve its growth profile, we feel quite good about the level of actions that we have in place. That being said, we're looking at multiple alternatives here. And so we have many different products that are in this portfolio. Do all of those fit? That's a fundamental question. The constructs of the geography of where we compete with that business, the construct of what our overall SG&A levels, those are all of the aspects there, obviously, to the full extreme of is this business better parked with someone else. So over the coming quarters, it will be about improvement of the business while simultaneously looking at those options. To your point on if you were to do something, would you do with the cash? I think it's obviously too early to discuss anything like that at this point. But our capital allocation priorities wouldn't change in either case, right? So we've been very clear about that, Jay and I in the past, that won't change going forward. Our focus on our organic investments is some of the highest returns. We've talked about those. You're seeing that play through in our orders growth. We believe that inorganic, the right level of tuck-in deals can make a lot of sense for this business to continue to grow it. And then we have other vehicles to distribute cash back, share buyback and stuff. We've done some in the quarter. Most likely, as in all things, it's not one lever. It's the right combination based on time. Operator: And our next question will come from the line of Robbie Marcus with JPMorgan. Unknown Analyst: This is [ Henry ] on for Robbie. I'll just ask both of them upfront. So first, on the generic Omnipaque, could you just talk a little bit about what you're seeing today in terms of the AB-rated approvals? And a little more importantly, what you expect the impact to be in the second half of '26 and 2027? And then second question on the EPS guide. The prior guide didn't include a rebate. So today, why did you choose not to raise the EPS guidance given the tariff refund and lower taxes that benefited second quarter relative to the prior expectations? Peter Arduini: Jay, do you want to take the first one and then maybe I'll take the guide? James Saccaro: Sure. So on Amneal, we haven't seen any impact at this point at all. What I would say is that the current contrast market demand is very close to outpacing total market supply. So it's a very tight market as we sit here today. And then as we forecast the market going forward, our expectation is based on increased procedure volumes in places like Cath labs, we expect the market to double in size over the next decade. So we're really talking about incredibly robust growth. With this growth, there have been periods of tight supply over the years. So we believe there's room for incremental supply on the market. The other thing I would say is like generic competition is not new in these contrast media markets and we've successfully navigated through multiple market cycles. And the way we do it, it comes down to being a trusted and consistent supplier. It comes down to having the full portfolio of products available and really being there when your customers need them. So listen, we never underestimate competition at all. We haven't seen an impact to date. We think that this market is going to be a tight one going forward. But then also, we do believe that there are aspects that differentiate our offering relative to others. And then, Pete, maybe on the guidance. Peter Arduini: Yes, I'll take the guidance question. So your question was with some of the tariff cash benefit, how come you didn't raise. Look, I think we recognized $0.04 of adjusted EPS related to the '26 tariffs within the P&L. I think others have taken more at a $0.04 level, this being halfway through the year and multiple cost items tied to oil, chips still somewhat in flux. We just thought it made sense to kind of stay where we're at. Obviously, if those stay at lower levels, we'll have upside within our guide. I think we have the appropriate cushion here to meet and potentially exceed. And so it just made sense at this point in time to kind of hold where we're at. Operator: Our next question comes from the line of Joanne Wuensch with Citi. Joanne Wuensch: I want to pause on China and think about what is going on in that region in terms of provincial budgets, VBP, pricing and anything else you can share geographically? Peter Arduini: Joanne, thanks for the question. Yes, look, there's always evolving dynamics in China. I would just say for us that when we look at China, the changes, the evolution are not new or I would say, out of the ordinary of what we're expecting. I mean we have expected that China over time will continue to expand VBP constructs. We've seen over the past couple of years, we've seen in other industries that way. It makes sense. It aligns to their strategy on anticorruption because they tend to be more transparent than non-VBP do. So from that standpoint, we haven't seen anything out of the ordinary. We were pleased with our China performance in Q2, which I would describe as in line with expectations. And we're making good progress in the most recent quarters. I think under Will's leadership, we've strengthened the portfolio. We've focused on clinical value propositions as well as we've stood up a provincial government affairs group that's been very helpful in how we think about properly positioning and strategic alignment on these VBPs, which, again, based on the recent headline news are going to continue to grow. So I think we view it from that standpoint. I also think it's -- our view on the dynamics of the region haven't greatly improved at this point, but we feel it's prudent to continue to assume kind of a year-over-year decline in 2026. That's what we've built into our plan, and there hasn't been any change there. Obviously, if that improves, that would be upside. But fundamentally in line with what our current expectations are. And I'd say we're getting better at making the right configuration decisions getting the right clinical discussions happening to be able to perform at a better level. Operator: Our next question will be from the line of Vik Chopra with BMO. Vikramjeet Chopra: Jay, thanks for all your help over the years. It was a pleasure working with you. So maybe the first question, you've ordered -- you highlighted strong orders and growth and initiatives to ship -- to improve shipment velocity and backlog conversion in PCS. I'm just wondering what level of margin recovery you expect from fixing these challenges alone? And how much would PCS have grown if you didn't have the supply chain issues in the second quarter? Peter Arduini: Vik, we're not -- I'm not going to get into hypotheticals to kind of play that out. But I would say, if you looked at our historical performance, when we had minimal challenges, we would expect to be back to that level. That's how I would frame it up. And again, much of that is specifically tied to velocity. We have a fixed cost structure without that velocity going through it. It has a disproportionate effect on profit. So once we get velocity back, I think you can look at previous year rates, and that's what we'd expect to be getting back to. Vikramjeet Chopra: Okay. Got it. And you referenced this new product cycle, the back half of '26 and into 2027 with new products across all modalities, call it, over the next 6 to 18 months. I'm just curious, Pete, which 2 or 3 NPIs do you view as the highest margin and the highest share gain opportunities? Peter Arduini: Vik, it's tough to choose between all of your children, which ones you like the most. But look, I think the team has done a very good job of many of them having big contributions. Now obviously, there are certain segments that disproportionately are bigger use models within a hospital. So our MR growth will have a disproportionate benefit from a profit and growth standpoint as we roll new products out. Our Photon-counting system, Photonova Spectra all in the same way and ultrasound across the board because what Phil and team have been able to do is leverage that platform approach across all of them. But I would say things such as like our vascular labs are very interesting. And that's a combination of we haven't traditionally performed as well there. We've had other competitors from outside the United States that have done better. And I think as we've talked about, we think we actually have probably the best system out there today that will come in multiple configurations. For us, that opens up competitive account doors that we haven't been able to compete in. So that would be how I would frame that up. But again, even in our mammography platform, we're doing quite well because now we have a very competitive image quality and performance capabilities, our core X-ray platform. Again, this has been just a maniacal focus to make sure that we're in a #1 or #2 position with all of our products and that they're greatly enhanced with artificial intelligence tools that change the productivity paradigm for customers. And that's what we're seeing. So early days yet, but we feel quite good about the receptivity at this point. Operator: Our last question is going to come from the line of Matt Taylor with Jefferies. Matthew Taylor: Jay, good luck in your next role. It's been great working with you for 20 years almost. So I just wanted to ask more about the outlook for costs. You talked about the levels versus your prior guide for this year. Could you talk a little bit about next year and how you're planning for the potential for increases in memory costs and oil is in flux, but if oil goes higher, how would you be able to hedge against that with some of the mitigation actions and the pricing that you've implemented? Peter Arduini: Yes, Matt, it's Pete. Look, I think the short answer is we have to be able to get adequate price to be able to offset those types of changes in the marketplace. All of our new products, we've been heavily focused on, on the cost side. And so there will be a natural lift in gross margins based on all of that. But in particular, the price aspects. And if you recall, we talked about raising prices and taking price actions in the first half. We will see more of an uplift of price here in the second half. And then obviously, that will continue into the beginning of 2027. So I don't know, Jay, if you want to add anything else to it. James Saccaro: Yes. The only thing I would add, Matt, is if you look at -- the story in the quarter really related to a PCS challenge driving down overall margin for the company. Despite very, very high inflation in the quarter, some of the highest that we've seen in years in a specific quarter, we still expanded margin, excluding PCS, by, I think, around 100 basis points, so a really remarkable story. You can expect to see more of that as we go into the future. And with the PCS business stabilizing, that too serves as a catalyst. So I think the playbook that we put in place this year, notably cost management and price to offset inflation, while there is a lag, and we saw that in the second quarter, the lag does benefit Q3, Q4 and all the way into next year. Operator: This concludes the question-and-answer session, and I will hand the call back to Peter for his closing remarks. Peter Arduini: Thanks, operator, and thanks, everyone, for your interest in GE Healthcare. We look forward to connecting with many of you here in upcoming discussions or some of our investor events in the near term. Thank you. Operator: This concludes today's conference call. Thank you for participating, and you may now disconnect. Everyone, have a great day. Before you buy stock in GE HealthCare Technologies, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and GE HealthCare Technologies wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $386,727!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,232,139!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 3, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has positions in and recommends GE HealthCare Technologies. The Motley Fool has a disclosure policy. GE HealthCare (GEHC) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Image source: The Motley Fool. Wednesday, July 29, 2026 at 8:30 a.m. ET Chief Investor Relations Officer - Carolynne Borders President and Chief Executive Officer - Peter Arduini Vice President and Chief Financial Officer - Jay Saccaro Controller and Chief Accounting Officer - George Newcomb Operator: Good day, and thank you for standing by. Welcome to the GE Healthcare Second Quarter 2026 Earnings Conference Call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Carolynne Borders, Chief Investor Relations Officer. Ma'am, please go ahead. Carolynne Borders: Thanks, operator. Good morning, and welcome to GE Healthcare's second quarter 2026 earnings call. I'm joined by our President and CEO, Peter Arduini; Vice President and CFO, Jay Saccaro; and our Controller and Chief Accounting Officer, George Newcomb. Our conference call remarks will include both GAAP and non-GAAP financial results. Reconciliations between GAAP and non-GAAP measures can be found in today's press release and in the presentation slides available on our website. During this call, we'll make forward-looking statements about our performance. These statements are based on how we see things today. As described in our SEC filings, actual results may differ materially due to risks and uncertainties. And with that, I'll hand the call over to Peter. Peter Arduini: Thanks, Carolynne. Good morning, and thank you for joining us today. We were pleased with our strong performance in the second quarter. Orders increased 11% with strong backlog, which grew $2.6 billion year-over-year and book-to-bill of 1.15x, all of which were at record levels. We're seeing healthy end market demand in all 3 of our segments and across geographies, reflected in the growth of our differentiated products and solutions that improve clinical outcomes and productivity. This sentiment was once again reflected in our most recent survey of top U.S. customers. We're increasingly becoming a key productivity enabler for our customers as they navigate capacity constraints and workflow challenges. At the same time, the substantial changes that we've made in our commercial organizations and progress on our new innovations, many of which are AI-enabled, strengthen our competitive position and are delivering results. We've launched several new products from our pipeline with more to come, and these products position us well to contribute meaningfully through the balance of the year and beyond. We're also seeing continued traction in our service businesses, strengthening our recurring revenue base and creating additional value for customers. Fundamentally, it's the sum of all of these parts that gives us confidence in the remainder of the year and our medium-term outlook. Revenue growth in the quarter was led by strength in pharmaceutical diagnostics and advanced imaging solutions. Patient Care Solutions performance remained challenged. We're actioning improvement initiatives via our business system Heartbeat with a focus on increasing shipment velocity and backlog conversion of our monitoring and anesthesia product lines to deliver PCS revenue and margin improvement in the second half. A bright spot in the quarter was strong PCS orders growth, particularly in monitoring, driven by our new platforms and recent sales force realignment. As we focus on accelerating recovery in this business, a comprehensive review of the strategic options is underway to determine the best path to maximize long-term growth and value, including continued ownership, a sale and other value-enhancing transactions. This is a business with depth and breadth that touches many areas within health systems. We have a healthy pipeline of new products in anesthesia and monitoring as well as digital offerings expected to be introduced this year and in 2027. Moving to Slide 4. Let's look at how we're delivering on our growth strategy, starting with how we enable precision care. D3 brings together smart devices and drugs, a disease state focus and digital capabilities, particularly AI. Heartbeat helps us align customer needs, product development, sales and service capabilities more effectively. And together, they help us bring innovative products to market faster and strengthen customer relationships while improving the margin profile of the portfolio over time. Our D3 strategy is resonating with customers and their interest in our differentiated solutions is reflected in our strong orders growth in the quarter, including broad-based contributions from ultrasound, MR, CT, patient monitoring, radiopharmaceuticals and interventional labs, among others. This aligns to the global demand backdrop we're seeing for our technologies and underscores how our differentiated innovations and field teams are winning in the market. In the U.S., we're seeing strong interest in Photonova Spectra, our photon-counting CT platform, and we expect CE marking in the second half of 2026, which will expand our opportunity in Europe. We've also received great customer feedback on True Definition DL, our latest deep learning CT software upgrade that enables nearly double the image resolution across the installed base. Like Air Recon DL, this is another good example of how we are using AI to enhance the clinical value of existing systems while giving customers another pathway to enhance performance. We also offer this as a subscription model, which brings recurring revenue. Together, these innovations highlight how we're expanding the value of our CT portfolio through new products and software innovations that appeal to customers. In PDx, we had a strong quarter in contrast media and robust growth in U.S. radiopharmaceuticals. This reflects the growing demand for advanced imaging that requires the breadth of our PDx portfolio. As an example, Vizamyl, our amyloid PET imaging agent, had strong double-digit revenue growth in the quarter, reflecting an increase in therapy adoption and an evolving Alzheimer's [ Eco-Care ] system, which includes broader diagnostic capabilities to identify and evaluate at-risk patients. Additionally, we are on track with our Flyrcado ramp. In the quarter, we delivered 545 doses for the week ending July 24. This is approximately a 40% increase over April levels. We onboarded more customers this quarter, which we expect will lead to increased utilization in the second half of the year. Customer feedback and acceptance remains strong. Looking to the second half, we remain focused on continuing to build momentum and these important indicators of our long-term growth trajectory. We remain confident in our medium-term target of $500 million or more in annual revenues by 2028. Moving to business optimization. We continue to prioritize additional cost and price actions as we navigate a dynamic macro environment. We lead the industry in bringing AI to customers, and we're also equally focused on using AI inside the company to improve productivity, simplify work and strengthen our supply chain so teams can spend more time on activities that create the greatest value for our customers. Since implementing the operational changes to create AIS in Global Markets, we have significantly increased our customer focus with channel changes that were completed in the second quarter. The AIS structure allows us to be a more nimble and agile organization. Before I turn the call over to Jay to review our financial results, I'd like to take a moment to thank him for his partnership and contributions to GE Healthcare over the past 3 years. Jay has helped build a strong financial organization and still greater financial discipline across the company and has been an important partner as we've executed our strategy. We're grateful for his leadership and impact that he's had on the business, and we wish you all the best in your next endeavor. During this transition, I have full confidence in George Newcomb, our incoming interim CFO, who has extensive experience. With that, I'll turn the call over to Jay to review our financial results. Jay? James Saccaro: Thanks, Pete. I really appreciate the partnership, and it's been a privilege to work alongside you in such a talented organization. I'm also proud of all that we've accomplished together, and I have great confidence in the team and the strong foundation we've built to continue executing on the strategy, delivering for patients, customers and shareholders. With that, I'll turn to our second quarter financial performance on Slide 5. We delivered revenue of $5.3 billion, representing 3.5% organic growth year-over-year, in line with our expectations. On a reported basis, we saw revenue growth across all regions. We had solid performance in product and service revenues at 4.7% and 7.7% growth, respectively. Service growth benefited from operational performance as well as contributions from the recent Intelerad acquisition. Organic orders growth was robust, up 11.1% year-over-year, the highest since our spin. We saw orders growth across all of our segments, with particular strength in several of our longer-cycle products in radiology, which represents our former imaging business. These products have longer sales conversion cycles, and we expect these orders to contribute to revenue more meaningfully in 2027. Book-to-bill was 1.15x, also our highest since the spin, and we exited the quarter with a record backlog of $23.9 billion, up $2.6 billion year-over-year and $2.1 billion sequentially. Approximately 1/4 of the sequential increase is in product backlog, while the balance relates to multiyear service agreements that convert to revenue over time. Adjusted EBIT of $750 million included $23 million in recognized refunds from IEEPA tariffs incurred in the first quarter of 2026. Adjusted EBIT margin of 14.2% was down 40 basis points year-over-year. We delivered adjusted EPS of $1.13 in the quarter, up 6.6% year-over-year. Adjusted EPS benefited from $0.04 of tariff refunds and $0.02 due to a lower tax rate year-over-year. Even when adjusting for these contributions, performance exceeded our expectations. Lastly, our free cash flow was $68 million in the quarter, which includes tariff refunds of $107 million. For this quarter, given macro dynamics, we thought it would be helpful to include additional details on our margin performance on Slide 6. Adjusted EBIT margin was 14.2%, down 40 basis points year-over-year. Let's walk through the drivers. First, year-over-year margin was negatively impacted by the challenging quarter in PCS as well as incremental inflationary costs from memory chips, oil and freight and other components. Despite these challenges, strong commercial execution drove volume growth, providing a margin tailwind year-over-year. Heartbeat is helping us better connect our product and commercial teams as we bring our latest innovations to market, supporting both growth and margin expansion. A great example is our Vivid Pioneer ultrasound, which leverages a platform approach to achieve a lower manufactured cost, coupled with differentiated AI capabilities that drive higher pricing. This product is performing better than we expected and has allowed us to deliver a significantly higher gross margin than the prior platform. This development model is replicated across all of our products in our new wave of innovation. Meanwhile, we're focusing on daily management to enable incremental price and cost actions to help offset inflation impacts in 2026. We started to see these improvements take hold in the second quarter and expect this to contribute more meaningfully to margin in the second half of the year and in 2027, even net of investments that we continue to make in the business. Lastly, the year-over-year impact of tariffs was neutral when including the benefit of refunds. Let's move to segment performance, starting with Advanced Imaging Solutions on Slide 7. As a reminder, this is our first quarter reporting the combined business that were formerly known as Imaging and Advanced Visualization Solutions, and we are providing a recast of prior period financials on our website. Organic revenue grew 5% year-over-year, driven by strength in Cardiovascular and Interventional Solutions, CT and Molecular Imaging. EBIT margin increased 90 basis points year-over-year, driven by volume and price, partially offset by inflation. We expect the combination of higher-margin AI-enabled NPIs like those in MR and CT, along with elevated clinical and commercial expertise to continue to drive growth. Moving to Pharmaceutical Diagnostics on Slide 8. We delivered particularly strong organic revenue growth of 14.6%, with strong volume and pricing in contrast media as well as robust growth in our U.S. radiopharmaceutical business. This was driven by increased adoption of disease-specific tracers across the portfolio. EBIT margin of 29.6% grew 30 basis points year-over-year, benefiting from volume and price, partially offset by planned investments in new products and our innovation pipeline. For example, we're making progress in our ongoing Phase II and III clinical trial for a non-gadolinium-based contrast agent, which we believe has the potential to significantly advance the MR contrast landscape. Looking ahead, we continue to expect growth driven by global contrast demand and scaling of our U.S. radiopharmaceutical business. As a reminder, current market demand is close to outpacing total market supply. We're a leader in contrast media where we win through our focus on supply chain resiliency and delivering the diversity of SKUs our customers require. Moving to Patient Care Solutions on Slide 9. Organic revenue declined 13.5% and segment EBIT was negative. We had operational fulfillment challenges in the quarter. As Pete mentioned, we've implemented several changes to strengthen supply and manufacturing capabilities that will address these issues. We expect to see supply improvement, which will benefit both sales and margin in the second half of the year. July has started well in this regard. On a positive note, PCS had strong first half orders growth, driven by monitoring as well as demand for our premium anesthesia product internationally. Backlog is well positioned. And in the second half of the year, we expect to deliver sequential improvement driven by daily focus and weekly execution plans to drive volume and margin recovery. We expect FDA clearance for our premium anesthesia device in the second half of 2026. As we reflect on overall results in the quarter, while PCS continued to be challenged, we're very pleased with the performance in the remainder of our business. Turning to cash on Slide 10. We delivered free cash flow of $68 million. Year-over-year cash flow increased primarily due to tariff refunds, partially offset by working capital investments and CapEx to support growth. We returned capital to shareholders through the repurchase of approximately $200 million worth of shares and continue to pay a dividend. I'll now turn the call back over to Pete to talk more about the full year outlook. Pete? Peter Arduini: Thanks, Jay. As noted throughout the call, we're pleased with the momentum in our business, reflecting healthy end market demand and continued commercial execution, which gives us confidence in our full year outlook. We're maintaining full year guidance, and this reflects 3% to 4% organic sales growth and 10 to 40 basis points adjusted EBIT margin expansion that gets us to a range of 15.4% to 15.7%. We're maintaining our adjusted EPS guidance in the range of $4.80 to $5. Approximately, we expect year-over-year organic revenue growth to be in the range of 3% to 4% as well as low double-digit adjusted EPS growth year-over-year. Now I'll turn to Slide 12, which highlights the strategic value of creating AIS and how our team, our differentiated portfolio and these unique advantages are advancing our growth strategy. We're in the early stages of our new wave of innovation, which is already driving strong results as reflected in our orders growth in the quarter, while also delivering higher gross margins as these products scale. Today, we have stronger commercial alignment with our customers, which includes 3 areas that we hear differentiate GE Healthcare. One, deeper clinical expertise. Our field teams with their business alignment create an agile team of experts able to address clinical and technical challenges. Two, our expanded service capabilities, which includes equipment maintenance and also a growing set of SaaS and software AI-enabled offerings brings a broad toolkit to customers; and three, GE Healthcare brings enterprise problem solving to all levels in the integrated delivery network globally. We hear from customers that our teams are collaborative, creative and relentlessly focused on helping them solve their toughest challenges. These 3 areas allow us to get closer to our customers and help them solve increasingly complex clinical and operational challenges. Lastly, Heartbeat strengthens how we execute. It enables repeatable processes and a culture of accountability and connects our teams more closely with customers. While we're still early in our Heartbeat journey, we're already seeing the benefits a global business system can bring. This focus is helping us win opportunities with leading institutions like the examples you'll see on the next slide. Catholic Health in New York wanted to expand their structural heart and electrophysiology programs and improve productivity and consistency across care settings. Working with their team, we jointly built a road map for technology modernization and services support to address their needs. This includes our latest cardiovascular ultrasound Vivid Pioneer, our interventional platform, Allia and comprehensive digital tools to create a disease state integrated solution, which strengthens Catholic Health's position in the market. Technology was an enabler, not a starting point. The result was an approximately $500 million agreement for equipment, service and process expertise that will result in orders over time. We saw a similar dynamic with the University Hospital Essen in Germany, where the focus was oncology and theranostics. By aligning technology goals and targeted outcomes, we work together to provide a fully integrated nuclear medicine solution that includes cyclotrons for tracer production, our new Total Body PET and SPECT/CT systems and MIM software for AI-enabled imaging analysis and therapy planning. These 2 examples show how we bring together our portfolio around disease states, not just products, underscoring the value of D3 and Heartbeat to deliver for customers. In summary, we've made meaningful progress with our innovation pipeline. New products are gaining traction. Our commercial changes are demonstrating results and our recent customer agreements show how those innovations are being pulled into larger long-term relationships. I'm proud of the AIS and PDx teams for their performance in the quarter. Combined, these 2 businesses grew approximately 6.5% and expanded margin 100 basis points year-over-year. We remain confident in the fundamentals of our business, and I'm proud of our team's commitment to delivering value for patients and customers worldwide. With that, we'll open up the call for Q&A. Carolynne Borders: Operator, we'll go ahead and take questions. Operator, can you please open the line? Operator: Our first question will come from the line of Larry Biegelsen with Wells Fargo. Larry Biegelsen: Jay, it was a pleasure working with you, and I wish you nothing but the best of luck going forward. So for my first question, Pete, I'd love to hear more color on what drove the strength in orders in Q2. Was there anything one-time? And how sustainable is that? And you know there are concerns around capital equipment demand in the U.S. given the ACA subsidy cuts. What are you seeing? Peter Arduini: Yes, Larry, thanks for the question. Look, I mean, we were delighted with our orders performance in the quarter. I would say, look, I mean, 11% is an outstanding number. We've always talked about that being in the mid-single-digit range with orders is quite critical. I think we feel good about that as we go into the second half as well. And that converts that mid-single digit to mid-single-digit revenue, again, which is aligned to our guide. So this is quite good. There really weren't any particular one-timers or any type of business coming in from Q3. It was just really good execution at a street level with our teams with the vast majority of it being our legacy portfolio. That complemented with some of the new products helping to deliver. And then as we've done and I highlighted the addition of enterprise accounts. I think we had about 6 enterprise accounts that contributed to some of the growth. But again, there weren't any items that were significantly big ones that were outliers. It was broad-based, and it was pretty consistent. I think if you look across molecular imaging, ultrasound, MR, CT, our vascular labs, the ultrasound whole portfolio, we talk a lot about cardiac, but point of care, general, women's health, everyone did well. And I would say there's been a lot of focus by our teams on how we execute. So we talk a lot about Heartbeat and the management system, but some of those things get down to how do we improve visibility. And we improve visibility, meaning what deals we see to participate around the world in by a couple of points this quarter. That translated into a couple of points of higher win rate. And those are some of the actions that you can't always execute each quarter on, but it came together quite well. So that's the broader level of it. And again, relative to a beat on the orders, that's the way we'd like to see it. It was broad-based and consistent across the board. The other aspect, I think you mentioned was how the markets are doing. From a procedure standpoint, I know there's been various news in the marketplace. Our best procedures view is really how PDx is doing and then actually how we would see some of the equipment that goes into procedure-based areas like cath labs. Both of those are doing very well. Our contrast agent business is doing extremely well. You heard that Jay mention about the performance of the numbers, both radiopharma as well as in contrast. And so that's a procedure based. And then in our vascular and surgical businesses, both represent vascular procedures, ortho procedures, cardiac, all of those continue to do well. And we haven't really seen any pullback from surveys that we've done out there. I would remind you, though, that we are a type of business that when any type of challenge comes to the hospital, the ability to have an imaging study that can get to a diagnosis very quickly and move a patient on to the right type of therapy and be able to get them out of the system healthy we typically see an uptick. And in many cases, with large deals, that's a big part of the discussion. What can we do to improve their overall productivity. So thanks for the question. Larry Biegelsen: That's very helpful. And just for my follow-up, Pete, we heard the Q3 guidance that you gave. The comps get tougher in the second half. Help bridge the second half implied acceleration on a comp-adjusted basis embedded in the guidance. What are the drivers? James Saccaro: Sure, Larry. Maybe I'll start on this one. I think a lot of this comes down to the robust orders performance that Pete talked to, 11% on a quarter basis. If you look at it on a 2-year stack, over 7% order growth, it really sets us up well heading into the second half. As we think about the first half to second half split over the last few years, we've seen roughly 48% of our revenue in the first half and 52% in the second half. Our 2026 outlook is basically in line with this historic trend. And as we look into the third quarter, one of the areas that we analyze is the thing called secured rate, how secure is the equipment revenue heading into the quarter. And our secured rate on equipment, we're about over 80%, nearly 85% secured entering the quarter, which is up several percentage points versus prior quarters. So we feel very good about that forecast. Also supporting the second half growth will be PCS stabilization. We'll see a bit of that and Flyrcado growth and more broadly, radiopharmaceutical growth as well. So really, those are the contributors to the second half, which we feel very solid about at this point in the quarter. And from a bottom line standpoint, look, our seasonality is such that we have more profit in the second half than the first half, we typically do. Historically, it's 55% roughly in the second half, 45% in the first half. And historically, we see from the first half to second half, about 2.5 percentage points of margin improvement. Now interestingly, we'll do a little bit better than that this year. And what it's going to come down to is really all the price and cost actions that we implemented in the second quarter that will carry us through into the second half, driving us over 300 basis points of expansion from the first half to the second half, with the other notable point being the new products that are coming in that are higher margins really help the mix as we approach the second half. So really, that's the story of the first half versus the second half, Larry. Operator: Our next question is going to come from the line of Vijay Kumar with Evercore ISI. Vijay Kumar: Pete, maybe my first one for you on the Pharma Diagnostics, another solid mid-teens. You gave the Flyrcado numbers. Can you just talk about what's driving it? It looks like the base business ex-Flyrcado is doing really well. What's driving that? And how are we thinking about Flyrcado ramp? Are we still good for the $0.5 billion number? Maybe time lines are moving here? Peter Arduini: Yes, Vijay, thanks for the question. Maybe I'll start at PDx and just kind of flow down through it to that point. So again, we did have a very strong quarter, and it was contrast and it was broad-based in radiopharma. And again, I think this is right on pace to many of the trends that we're seeing out there. We've said in the past, we expect the business to grow high single-digit range. I think that's kind of the expectation. This was obviously a little bit higher performance within the given quarter. But it was a broad-based. I think I mentioned Vizamyl, that was up significantly. And again, it's highly tied to the amyloid beta therapy adoption doing well there. Our product DaTscan for Parkinson's disease was up quite a bit, Cerianna in breast cancer. And then obviously, Flyrcado is kind of our premier product within that area, and we're pleased with the progress. I think this won't obviously be linear. There's going to be bigger spikes at different points in time. But at this point, the 545 doses, which again is about 40% increase -- the other aspect I mentioned on -- in the prepared remarks was the fact that we brought on quite a few new customers as well, pretty much about that same ratio. And they will -- when you bring them on, I think we've talked about this in the past, first 60 days, they're minimally productive. And then past that, they start increasing the amount of doses. And so we're in a really good spot here to ramp this up as we go into Q3 and Q4. The longer-term opportunity of $0.5 billion annually by 2028 is fully intact. I mean, again, remind people, if you think of the perfusion studies that are out there in the pet world, you get about 10% of those studies overall. That's roughly about $500 million in revenue. So we think we -- as we've always talked about, we have much -- a very good chance to do better than that, but we're focused on the $0.5 billion here by 2028. Vijay Kumar: That's very helpful, Pete. Jay, one for you. Look, there's never an ideal time for transition. It seemed a bit abrupt for us. Maybe talk about why now and where are we in the CFO search process? James Saccaro: Vijay, obviously, it's very difficult to leave. We've made such tremendous progress at the company on the innovation pipeline, really setting up processes, establishing the Heartbeat operating system. I feel so good about where the business currently sits and where it's heading. And so makes it very hard to leave. Also, the partnership with Pete and our leadership team has been a remarkable one. I have nothing but respect for that team. And I believe we have a world-class finance function that I've been privileged to work with. So all of that makes it difficult. For me, what this came down to is a very unique opportunity at a great company to expand my role beyond finance. So that's what really this came down to. It's never an opportune time. But what I would say is I really do believe we've put the building blocks in place that have set the company up going forward in the right direction. Pete, maybe you could talk a little bit about the search. Peter Arduini: Yes, I'll take the search. I mean, obviously, Vijay, we just kicked it off. We're going to move quite quickly as we dig into it. I think we're blessed with our market recognition, people understanding what we're doing with AI, how we're in the interesting seat to transform healthcare. So we've got a lot of interest that's out there. And so I would expect we'll be able to talk more about it here in the coming months about how we're making progress against it. In the meantime, George, who's been with us over 38 years in many different roles, deeply involved in all of our operations over the past years, at least since I've been here and beyond, is going to be a great partner here for me. Operator: Our next question comes from the line of Rick Wise with Stifel. Frederick Wise: Pete, a question for you and then a question for Jay. You obviously talked about the new wave of innovation. And stepping back, just are you seeing the impact from that wave of innovation broadly speaking? Is that broadly at a higher level, we're seeing drive orders? Should we expect to see that broad portfolio drive accelerated order growth as you look ahead for the next several years? How are you thinking about it? And most specifically, talk about the impact that having Photonova Spectra now launched is having broadly on the full portfolio pull-through? Peter Arduini: Yes, Rick, thanks for the question. Again, I think particularly if you look at this quarter, we really had all the things kind of come together. I mean we've had some growth here from some of the new products. But again, in the spectrum of all the products that we've talked about, it's still under 20% of the value, meaning it's still a smaller contributor. I'll talk about Photonova in a minute, but Photonova was a minimal contributor to the orders book. That's all still in front of us. What really drove CT was our breadth of our core product line. So you've got really good products that we've been able to raise some level of price, fair amount of price on them and new products that actually have better cost positions and slightly higher price. That's in that book. But I think some of these changes we just talked about, we mentioned Global Markets and AIS, our ability to actually just execute better in front of the customer to be able to describe why us versus someone else, be able to focus on their problem and how to bring our products together to solve their problems. We've been focused on this quite a bit. And so that's a rising impact, and I give a lot of credit to our field teams, both sales and service for that aspect of it. And then the piece relative to enterprise, there are more and more enterprise deals increasing. But I mean, just to get -- put in perspective, I talked about Catholic Health, which is a great partner. Only about 1/5 of those orders are actually a part of what went in the second quarter. So there's still much in front of us. So it was broad-based and consistent. And then I think when you look at MR, MR is an area for us that we have talked about investing in to increase margins. We talked about increasing and changing the profile. The team has done quite well, the Bolt 3T, the new fully integrated user experience, which we updated just a few months ago. It's the first change in probably 25 years in our MR platform, widely viewed as probably the best UI now in the marketplace, making a big difference. The whole portfolio that's playing out in molecular imaging, our PET platform, what's happening there doing well. PCS, as we mentioned, actually on the orders front, actually doing quite well with monitoring for the new platforms that are out there. And then in the AI and specifically in ultrasound and interventional, we're doing very well. And those products, as Phil mentioned as well, have a faster turn. So they will contribute more to a revenue conversion in the second half. The traditional imaging products will be probably more so early in 2027, mainly because they have a room build-out. But we're in very good shape there. And to your Photonova question, things are on track. I had mentioned we need CE marking. That's going to be in the second half of the year. It's a little bit later than we initially communicated, but all in good shape there. We had really very good step-ups in the funnel. I mean this is preorder, but this is prospects that were qualified and ready to step into an order phase. So we're in quite good shape there. And again, that will be a significant growth driver here as we get late to this year and into next year. And so at this point in time, it's not a major driver within the orders book, but will be in the future. Frederick Wise: Got you. And Jay, wishing you all the best in your next job, new role. But you're leaving Pete, you're leaving your successor and you're leaving us with the medium-term '26, '28 outlook goals and targets, the mid-single-digit organic growth, high teens to 20% adjusted EBIT margin, high single-digit to low double-digit EPS growth, 90% free cash flow conversion. Sorry to recite it all, but what's your comfort as you're leaving, or Pete, what's your comfort with the medium-term targets now? Peter Arduini: So Rick, while we're here live, I'll let Jay here as -- make his comment, and then I'll jump in. Jay, maybe you want to hit it quickly. James Saccaro: Yes. Rick, we feel very good about the midterm story. And for us, what we always knew was that the midterm story would be unlocked by 2 things: One, the innovation cycle, and I'm so proud that we've been able to deliver on this. And now it's about executing commercialization that's going to drive that. And two is implementation of an operating system. We call it Heartbeat to drive rigor around commercial and the operational aspects of what we need to do. And so those 2 ingredients are going to be the things that unlock this midterm story. And I have to say both have been put in place and serve as an incredibly solid foundation. Pete? Peter Arduini: Yes. No, look, I think, Rick, we feel quite bullish about where we stand with our midterm targets. Jay hit it. I mean, look, it all starts with do you have the right demand in the marketplace? Which is matched up with the right sales and service teams, but it comes with the right products. We believe we've got the right portfolio coming out. And that portfolio is yet to really deliver the type of results. I just mentioned the Photonova ramp that we expect. All of those products have the opportunity for higher price. There's not been one product that we introduced that hasn't come out at a higher value than its predicate and customers are willing to pay for it. Why? Because it has a lot of embedded features that makes them more productive, whether they're AI or just how they're built into it. And we've leveraged this platform approach where we've been able to come up with, I think, better reliability, but also better cost because of the reuse and leverage of different chassis. So the combination of those is faster growth and better gross margin. So there's a big chunk there. Jay hit on Heartbeat, which, again, I think you're going to hear more and more about what that does for consistency and better execution. And then this point I made on the prepared remarks about AI inside, we see a significant opportunity to increase our own productivity with the use of AI inside so that as we grow, we can grow with a lower G&A based on a higher base. And a lot of that is with the use of agents and tools that can help us be more consistent. So we're locked in. We feel very good about our midterm targets. And honestly, this was a great quarter here to demonstrate that we're well positioned to deliver on it. Operator: Our next question will come from the line of Travis Steed with BofA Securities. Travis Steed: Jay, we'll miss working with you and best of luck in your new role. I wanted to ask about inflation impact on margins. Anything you'd kind of call out or quantify this quarter. If you look at the different buckets you gave last quarter, memory, oil and [ all-in ] freight costs and other inflation buckets, how those are trending versus 3 months ago and how you kind of think about the go-forward there? James Saccaro: So yes, overall, from an inflation standpoint, what I would say is we saw a very volatile macro environment to start the year. We had the memory chip phenomena. We had the war in the Middle East impact logistics and freight in certain other metals. But -- so last quarter, we had to take an approach to adjust the guidance. What I would say is since then, things are broadly speaking, tracking in line with our expectations. Memory chips have continued to increase, but much more modestly. So we're seeing -- we've seen a little bit of increase since the first quarter call, but nothing notable. And oil, while it remains elevated, it is down a bit from the previous peak. And so the $250 million assumption, which included some cushion in it when we put it together is still the appropriate amount for where we sit today. In the second quarter, inflation was about 120 basis point headwind, which was in line with our expectations. And I think for me, the most important aspect is in conjunction with that gross inflation, we put in place a series of mechanisms to offset it, both in terms of cost and price. And we've made really good progress on both of those initiatives, which will support growth into the second half of the year, but then also into 2027. Travis Steed: Great. And then kind of follow-up on the PCS business and the decline this quarter, any more color you'd give on that and when that business starts to stabilize? And then the PCS strategic review, how that's tracking and what you do with extra cash if you got cash from that strategic review? Peter Arduini: Yes, Travis, thanks for the question. Look, I think, again, the first bright spot on PCS was we saw orders growth, particularly in the monitoring world that hasn't performed at that level in quite some months. That's heavily tied to, I think we refocused the sales organization in the quarter that was completed as well as some of the new products. So that's a super important point that needs to be out there. But the reality of it is, look, we had operational fulfillment challenges in the quarter. What do those mean? Short on supply of some critical components, things of that nature. Ultimately, that results in our inability to fulfill. Some of those specific orders, obviously, will move out into the second half. We feel good at this point in time with the new focus that the team has in place that we'll be able to fulfill those and correct those. But ultimately, it's about shoring up our supply chain and our ability to deliver consistency and consistently. And so Jeannette and the team have a daily, weekly focus on this. I'd say we've really got into the details to be able to get the business aligned and feel good about what we can do to be able to address those. As we mentioned as well, I will expect that we will see improvement here within the second half quarter-over-quarter, I think both on top line and bottom line. This is a business that is heavily tied to its volume from its profitability standpoint. So as we move velocity, particularly in monitoring anesthesia through those facilities, you'll see the corresponding profit increase. Look, on the strategic review, Travis, to your question, you would expect us to be taking a look at this business in many different ways to say, how do we have this be a contributor, whether it's a contributor for us or someone else that needs to be addressed. That's job one. And again, I think over the coming quarters, the efforts that we have to improve its profitability, improve its growth profile, we feel quite good about the level of actions that we have in place. That being said, we're looking at multiple alternatives here. And so we have many different products that are in this portfolio. Do all of those fit? That's a fundamental question. The constructs of the geography of where we compete with that business, the construct of what our overall SG&A levels, those are all of the aspects there, obviously, to the full extreme of is this business better parked with someone else. So over the coming quarters, it will be about improvement of the business while simultaneously looking at those options. To your point on if you were to do something, would you do with the cash? I think it's obviously too early to discuss anything like that at this point. But our capital allocation priorities wouldn't change in either case, right? So we've been very clear about that, Jay and I in the past, that won't change going forward. Our focus on our organic investments is some of the highest returns. We've talked about those. You're seeing that play through in our orders growth. We believe that inorganic, the right level of tuck-in deals can make a lot of sense for this business to continue to grow it. And then we have other vehicles to distribute cash back, share buyback and stuff. We've done some in the quarter. Most likely, as in all things, it's not one lever. It's the right combination based on time. Operator: And our next question will come from the line of Robbie Marcus with JPMorgan. Unknown Analyst: This is [ Henry ] on for Robbie. I'll just ask both of them upfront. So first, on the generic Omnipaque, could you just talk a little bit about what you're seeing today in terms of the AB-rated approvals? And a little more importantly, what you expect the impact to be in the second half of '26 and 2027? And then second question on the EPS guide. The prior guide didn't include a rebate. So today, why did you choose not to raise the EPS guidance given the tariff refund and lower taxes that benefited second quarter relative to the prior expectations? Peter Arduini: Jay, do you want to take the first one and then maybe I'll take the guide? James Saccaro: Sure. So on Amneal, we haven't seen any impact at this point at all. What I would say is that the current contrast market demand is very close to outpacing total market supply. So it's a very tight market as we sit here today. And then as we forecast the market going forward, our expectation is based on increased procedure volumes in places like Cath labs, we expect the market to double in size over the next decade. So we're really talking about incredibly robust growth. With this growth, there have been periods of tight supply over the years. So we believe there's room for incremental supply on the market. The other thing I would say is like generic competition is not new in these contrast media markets and we've successfully navigated through multiple market cycles. And the way we do it, it comes down to being a trusted and consistent supplier. It comes down to having the full portfolio of products available and really being there when your customers need them. So listen, we never underestimate competition at all. We haven't seen an impact to date. We think that this market is going to be a tight one going forward. But then also, we do believe that there are aspects that differentiate our offering relative to others. And then, Pete, maybe on the guidance. Peter Arduini: Yes, I'll take the guidance question. So your question was with some of the tariff cash benefit, how come you didn't raise. Look, I think we recognized $0.04 of adjusted EPS related to the '26 tariffs within the P&L. I think others have taken more at a $0.04 level, this being halfway through the year and multiple cost items tied to oil, chips still somewhat in flux. We just thought it made sense to kind of stay where we're at. Obviously, if those stay at lower levels, we'll have upside within our guide. I think we have the appropriate cushion here to meet and potentially exceed. And so it just made sense at this point in time to kind of hold where we're at. Operator: Our next question comes from the line of Joanne Wuensch with Citi. Joanne Wuensch: I want to pause on China and think about what is going on in that region in terms of provincial budgets, VBP, pricing and anything else you can share geographically? Peter Arduini: Joanne, thanks for the question. Yes, look, there's always evolving dynamics in China. I would just say for us that when we look at China, the changes, the evolution are not new or I would say, out of the ordinary of what we're expecting. I mean we have expected that China over time will continue to expand VBP constructs. We've seen over the past couple of years, we've seen in other industries that way. It makes sense. It aligns to their strategy on anticorruption because they tend to be more transparent than non-VBP do. So from that standpoint, we haven't seen anything out of the ordinary. We were pleased with our China performance in Q2, which I would describe as in line with expectations. And we're making good progress in the most recent quarters. I think under Will's leadership, we've strengthened the portfolio. We've focused on clinical value propositions as well as we've stood up a provincial government affairs group that's been very helpful in how we think about properly positioning and strategic alignment on these VBPs, which, again, based on the recent headline news are going to continue to grow. So I think we view it from that standpoint. I also think it's -- our view on the dynamics of the region haven't greatly improved at this point, but we feel it's prudent to continue to assume kind of a year-over-year decline in 2026. That's what we've built into our plan, and there hasn't been any change there. Obviously, if that improves, that would be upside. But fundamentally in line with what our current expectations are. And I'd say we're getting better at making the right configuration decisions getting the right clinical discussions happening to be able to perform at a better level. Operator: Our next question will be from the line of Vik Chopra with BMO. Vikramjeet Chopra: Jay, thanks for all your help over the years. It was a pleasure working with you. So maybe the first question, you've ordered -- you highlighted strong orders and growth and initiatives to ship -- to improve shipment velocity and backlog conversion in PCS. I'm just wondering what level of margin recovery you expect from fixing these challenges alone? And how much would PCS have grown if you didn't have the supply chain issues in the second quarter? Peter Arduini: Vik, we're not -- I'm not going to get into hypotheticals to kind of play that out. But I would say, if you looked at our historical performance, when we had minimal challenges, we would expect to be back to that level. That's how I would frame it up. And again, much of that is specifically tied to velocity. We have a fixed cost structure without that velocity going through it. It has a disproportionate effect on profit. So once we get velocity back, I think you can look at previous year rates, and that's what we'd expect to be getting back to. Vikramjeet Chopra: Okay. Got it. And you referenced this new product cycle, the back half of '26 and into 2027 with new products across all modalities, call it, over the next 6 to 18 months. I'm just curious, Pete, which 2 or 3 NPIs do you view as the highest margin and the highest share gain opportunities? Peter Arduini: Vik, it's tough to choose between all of your children, which ones you like the most. But look, I think the team has done a very good job of many of them having big contributions. Now obviously, there are certain segments that disproportionately are bigger use models within a hospital. So our MR growth will have a disproportionate benefit from a profit and growth standpoint as we roll new products out. Our Photon-counting system, Photonova Spectra all in the same way and ultrasound across the board because what Phil and team have been able to do is leverage that platform approach across all of them. But I would say things such as like our vascular labs are very interesting. And that's a combination of we haven't traditionally performed as well there. We've had other competitors from outside the United States that have done better. And I think as we've talked about, we think we actually have probably the best system out there today that will come in multiple configurations. For us, that opens up competitive account doors that we haven't been able to compete in. So that would be how I would frame that up. But again, even in our mammography platform, we're doing quite well because now we have a very competitive image quality and performance capabilities, our core X-ray platform. Again, this has been just a maniacal focus to make sure that we're in a #1 or #2 position with all of our products and that they're greatly enhanced with artificial intelligence tools that change the productivity paradigm for customers. And that's what we're seeing. So early days yet, but we feel quite good about the receptivity at this point. Operator: Our last question is going to come from the line of Matt Taylor with Jefferies. Matthew Taylor: Jay, good luck in your next role. It's been great working with you for 20 years almost. So I just wanted to ask more about the outlook for costs. You talked about the levels versus your prior guide for this year. Could you talk a little bit about next year and how you're planning for the potential for increases in memory costs and oil is in flux, but if oil goes higher, how would you be able to hedge against that with some of the mitigation actions and the pricing that you've implemented? Peter Arduini: Yes, Matt, it's Pete. Look, I think the short answer is we have to be able to get adequate price to be able to offset those types of changes in the marketplace. All of our new products, we've been heavily focused on, on the cost side. And so there will be a natural lift in gross margins based on all of that. But in particular, the price aspects. And if you recall, we talked about raising prices and taking price actions in the first half. We will see more of an uplift of price here in the second half. And then obviously, that will continue into the beginning of 2027. So I don't know, Jay, if you want to add anything else to it. James Saccaro: Yes. The only thing I would add, Matt, is if you look at -- the story in the quarter really related to a PCS challenge driving down overall margin for the company. Despite very, very high inflation in the quarter, some of the highest that we've seen in years in a specific quarter, we still expanded margin, excluding PCS, by, I think, around 100 basis points, so a really remarkable story. You can expect to see more of that as we go into the future. And with the PCS business stabilizing, that too serves as a catalyst. So I think the playbook that we put in place this year, notably cost management and price to offset inflation, while there is a lag, and we saw that in the second quarter, the lag does benefit Q3, Q4 and all the way into next year. Operator: This concludes the question-and-answer session, and I will hand the call back to Peter for his closing remarks. Peter Arduini: Thanks, operator, and thanks, everyone, for your interest in GE Healthcare. We look forward to connecting with many of you here in upcoming discussions or some of our investor events in the near term. Thank you. Operator: This concludes today's conference call. Thank you for participating, and you may now disconnect. Everyone, have a great day. Before you buy stock in GE HealthCare Technologies, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and GE HealthCare Technologies wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $397,081!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,166,221!* Now, it’s worth noting Stock Advisor’s total average return is 889% — a market-crushing outperformance compared to 203% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of July 30, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has positions in and recommends GE HealthCare Technologies. The Motley Fool has a disclosure policy. GE HealthCare (GEHC) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Never miss an important update on your stock portfolio and cut through the noise. Over 7 million investors trust Simply Wall St to stay informed where it matters for FREE. GE HealthCare Technologies stock has climbed 17.1% over the past week, yet the latest valuation work still points to a sizeable gap between the current share price and an intrinsic value estimate based on a Discounted Cash Flow (DCF) model. The 17.1% gain over the past week suggests sentiment has turned quickly, even though the longer term share performance has been far more muted. The recently announced long term Care Alliance with Catholic Health can support expectations for recurring revenue and cash flow. At the same time, the ongoing investigation related to a supplier recall may weigh on how investors price in future profitability. GE HealthCare Technologies screens as undervalued on most of Simply Wall St's checks, with the stock passing 5 of 6 valuation tests here. This points to a broader picture that leans cheap rather than fully priced. The issue now is whether that 42.5% discount to the DCF based intrinsic value offers enough upside to compensate for the risks that recent news has brought into focus. GE HealthCare Technologies delivered 0.6% returns over the last year. See how this stacks up to the rest of the Medical Equipment industry. The Discounted Cash Flow (DCF) model values GE HealthCare Technologies on the cash it is expected to generate for shareholders over time. The latest twelve month free cash flow sits at about $1.57b, and the model uses a growing cash flow profile to arrive at an estimated intrinsic value of $125 per share. Against the current share price, that implies the stock screens around 42.5% undervalued based on these cash flow assumptions. The recently announced $500m, 10 year Care Alliance with Catholic Health supports the case for recurring equipment and service cash flows, while the ongoing investigation linked to a supplier recall helps explain why the market is still pricing GE HealthCare Technologies below this intrinsic value estimate. On this DCF view, GE HealthCare Technologies stock currently looks undervalued relative to the cash flows baked into the model. Our Discounted Cash Flow (DCF) analysis suggests GE HealthCare Technologies is undervalued by 42.5%. Track this in your watchlist or portfolio, or discover 49 more high quality undervalued stocks. Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for GE HealthCare Technologies. P/E is often a clean way to compare earnings power across medical equipment stocks, so it is a useful cross-check for GE HealthCare Technologies. The stock currently trades on a P/E of about 17.1x, which sits well below the Medical Equipment industry average of 29.3x and also below the peer group average of 27.2x. The fair P/E that adjusts for GE HealthCare Technologies' size, margins and risk profile is estimated at about 27.4x. That is materially higher than the current 17.1x multiple. On this framework, the difference points to a sizable discount and indicates the market is pricing GE HealthCare Technologies' earnings more cautiously than both sector benchmarks and the tailored fair P/E estimate. On the P/E multiple, GE HealthCare Technologies stock appears undervalued compared with both its industry and the modelled fair ratio. See what the numbers say about this price — find out in our valuation breakdown. Simply Wall St Narratives for GE HealthCare Technologies pick up where the valuation work leaves off and explain which future growth, margin and earnings paths would need to occur for today's share price to appear high or low. Each narrative links its figures to a clear view on how GE HealthCare Technologies' growth, profitability and risks might evolve. You can revisit these views as new information and results are released on the Community page. Community views on GE HealthCare Technologies sit far apart, with one side focusing on product and partnership momentum and the other on execution risk and cost pressure. Bull case: 10% undervalued Read the full Bull Case to see why GE HealthCare Technologies could be undervalued Bear case: 11% overvalued Read the full Bear Case to see why GE HealthCare Technologies could be overvalued Do you think there's more to the story for GE HealthCare Technologies? Head over to our Community to see what others are saying! For GE HealthCare Technologies, both the Discounted Cash Flow (DCF) intrinsic value estimate and the earnings multiple view point to a stock that screens as undervalued rather than fully priced. The key question is whether the current discount reflects temporary caution around the supplier recall investigation or a more persistent concern about future profitability. If cash flows and margins hold closer to what the models assume, the gap to intrinsic value may narrow over time. If legal and execution risks prove more costly than expected, the current pricing could be closer to fair and the apparent discount may turn out to be a value trap. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include GEHC. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

This article first appeared on GuruFocus. Revenue: $5.3 billion, representing 3.5% organic growth year-over-year. Orders Growth: 11% year-over-year, highest since the spin. Backlog: $23.9 billion, up $2.6 billion year-over-year. Adjusted EBIT: $750 million, with a margin of 14.2%, down 40 basis points year-over-year. Adjusted EPS: $1.13, up 6.6% year-over-year. Free Cash Flow: $68 million, including $107 million in tariff refunds. Advanced Imaging Solutions Revenue Growth: 5% year-over-year. Pharmaceutical Diagnostics Revenue Growth: 14.6% organic growth year-over-year. Patient Care Solutions Revenue Decline: 13.5% organic decline year-over-year. Warning! GuruFocus has detected 4 Warning Signs with GEHC. Is GEHC fairly valued? Test your thesis with our free DCF calculator. Release Date: July 29, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. GE HealthCare Technologies Inc (NASDAQ:GEHC) reported a strong performance in Q2 2026 with an 11% increase in orders and a record backlog growth of $2.6 billion year-over-year. The company launched several new AI-enabled products, strengthening its competitive position and contributing to revenue growth. GEHC's pharmaceutical diagnostics and advanced imaging solutions segments led revenue growth, with strong performance in contrast media and US radiopharmaceuticals. The company is seeing strong interest in its Photon Counting CT platform, Photonova Spectra, and expects to expand its opportunity in Europe with CE marking in the second half of 2026. GEHC maintained its full-year guidance, reflecting confidence in achieving 3% to 4% organic sales growth and 10 to 40 basis points adjusted EBIT margin expansion. Patient Care Solutions (PCS) performance remained challenged, with a 13.5% decline in organic revenue due to operational fulfillment challenges. The company faced inflationary pressures, particularly from memory chips, oil, and freight, impacting margins. Despite strong orders growth, the PCS segment's EBIT was negative, highlighting ongoing supply chain and manufacturing issues. GEHC's adjusted EBIT margin of 14.2% was down 40 basis points year-over-year, partly due to inflation and challenges in the PCS segment. The CFO transition was noted as abrupt, raising concerns about continuity in financial leadership during a critical growth phase. Q: Can you provide more color on what drove the strength in orders in Q2, and how sustainable is that growth given concerns around capital equipment demand in the US? A: Peter Arduini, President and CEO, explained that the 11% orders growth was broad-based and consistent across segments like molecular imaging, ultrasound, MR, and CT. There were no significant one-time factors; rather, it was due to strong execution and enterprise accounts. The demand for imaging studies remains robust, and the company is well-positioned to continue this momentum into the second half of the year. Q: Could you help bridge the second half implied acceleration on a comp-adjusted basis embedded in the guidance? A: James Saccaro, CFO, noted that the robust orders performance sets up well for the second half. The company expects PCS stabilization and growth in radiopharmaceuticals to support this. Historically, more profit is generated in the second half, and they anticipate margin improvements due to price and cost actions implemented in Q2. Q: Can you discuss the strong performance in pharmaceutical diagnostics and the outlook for Plakadoramp? A: Peter Arduini highlighted strong growth in contrast media and radiopharmaceuticals, driven by increased adoption of disease-specific tracers. The Plakadoramp is on track, with a 40% increase in doses delivered. The company remains confident in achieving $500 million in annual revenues by 2028. Q: Why did you choose not to raise the EPS guidance despite the tariff refund and lower taxes? A: Peter Arduini explained that while they recognized $0.04 of adjusted EPS related to tariffs, they chose to maintain guidance due to ongoing cost uncertainties, such as oil and chips. The company believes it has the appropriate cushion to meet and potentially exceed expectations. Q: What is the outlook for costs, particularly regarding memory and oil inflation, and how will you hedge against potential increases? A: Peter Arduini stated that the company plans to offset cost increases through adequate pricing. New products are focused on cost efficiency, and price actions taken in the first half will continue to benefit the second half and into 2027. James Saccaro added that despite high inflation, the company expanded margins, excluding PCS, by around 100 basis points. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

GE HealthCare Technologies (GEHC) came out with quarterly earnings of $1.13 per share, beating the Zacks Consensus Estimate of $1.04 per share. This compares to earnings of $1.06 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +8.65%. A quarter ago, it was expected that this medical technology company would post earnings of $1.07 per share when it actually produced earnings of $0.99, delivering a surprise of -7.48%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. GE HealthCare, which belongs to the Zacks Medical - Products industry, posted revenues of $5.3 billion for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 0.41%. This compares to year-ago revenues of $5.01 billion. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. GE HealthCare shares have lost about 21.8% since the beginning of the year versus the S&P 500's gain of 8.5%. While GE HealthCare has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for GE HealthCare was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.25 on $5.4 billion in revenues for the coming quarter and $4.89 on $21.71 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Medical - Products is currently in the bottom 35% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, Insulet (PODD), is yet to report results for the quarter ended June 2026. The results are expected to be released on August 5. This maker of insulin infusion systems is expected to post quarterly earnings of $1.38 per share in its upcoming report, which represents a year-over-year change of +18%. The consensus EPS estimate for the quarter has been revised 0.3% lower over the last 30 days to the current level. Insulet's revenues are expected to be $786.82 million, up 21.2% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report GE HealthCare Technologies Inc. (GEHC) : Free Stock Analysis Report Insulet Corporation (PODD) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved record organic orders growth of 11.1% and a record backlog of $23.9 billion, driven by healthy end-market demand and successful commercial realignment. Performance was led by Pharmaceutical Diagnostics (PDx) and Advanced Imaging Solutions (AIS), which combined for 6.5% growth and 100 basis points of margin expansion. Patient Care Solutions (PCS) remained challenged due to operational fulfillment issues and supply chain constraints, prompting a comprehensive strategic review of the business. The 'D3' strategy (Devices, Drugs, Digital) is gaining traction, with AI-enabled innovations like True Definition DL and Vivid Pioneer driving higher pricing and improved gross margins. Management attributed the strong order book to improved field execution and a higher win rate facilitated by the 'Heartbeat' operational business system. Market demand for contrast media remains robust, with current global demand nearly outpacing total market supply, supporting strong PDx volume and pricing. Maintained full-year 2026 guidance, assuming 3%-4% organic sales growth and 10-40 basis points of adjusted EBIT margin expansion. Expects significant margin improvement in the second half of 2026, driven by price-cost actions and the scaling of higher-margin new product introductions (NPIs). The strategic review of PCS includes options ranging from continued ownership to a potential sale or other value-enhancing transactions to maximize long-term growth. Maintained the medium-term target for the radiopharmaceutical business to reach $500 million or more in annual revenue by 2028, supported by the Flyrcado ramp. Guidance for 2026 assumes a year-over-year decline in China, though management views the expansion of Volume-Based Procurement (VBP) as a manageable, transparent shift. Recognized $23 million in P&L refunds from IEEPA tariffs in Q2, with a total of $107 million impacting free cash flow. CFO Jay Saccaro is departing for a new role; George Newcomb has been appointed interim CFO while a formal search is conducted. Inflationary headwinds from memory chips, oil, and freight impacted margins by 120 basis points in the quarter, largely offset by commercial execution. Completed the commercial restructuring of the Advanced Imaging Solutions (AIS) segment to increase agility and customer focus. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management clarified there were no one-time items or pull-forwards; growth was broad-based across molecular imaging, ultrasound, MR, and CT. Hospital procedure volumes remain strong, particularly in contrast-heavy diagnostic imaging and vascular procedures. Revenue is 85% 'secured' entering Q3, which is several percentage points higher than typical levels. Margin expansion of over 300 basis points is expected from H1 to H2, driven by the lag effect of price increases and lower-cost product platforms. Management has seen no impact to date from generic entrants, noting that the market is currently supply-constrained. GEHC believes its supply chain resiliency and full SKU portfolio provide a competitive moat against generic players. Performance in China was in line with expectations despite macro headwinds; the company is assuming a decline for the full year. Management is proactively aligning with provincial governments to navigate the shift toward more transparent VBP bidding processes.

GE HealthCare Technologies Inc. GEHC reported second-quarter 2026 adjusted earnings per share (EPS) of $1.13, which beat the Zacks Consensus Estimate of $1.04 by 8.7%. The bottom line increased 6.6% year over year, aided by commercial execution, pricing and productivity gains. GAAP EPS in the quarter was $1.24, up 16.5% from the year-ago level. GEHC shares were up 8.3% in pre-market trading. Year to date, shares of the company have lost 21.9% compared with the industry’s 17.1% decline. However, the S&P 500 Index has risen 8.1% in the same period. Image Source: Zacks Investment Research Revenues of $5.29 billion increased 5.7% year over year on a reported basis and 3.5% organically. The top line surpassed the Zacks Consensus Estimate by 0.7%. Revenue growth was led by Pharmaceutical Diagnostics (PDx) and Advanced Imaging Solutions (AIS), along with strength in the United States, EMEA and Rest of World markets. However, growth was partially offset by a decline in the Patient Care Solutions (PCS) segment. Total company orders increased 11.1% year over year organically. The book-to-bill ratio was 1.15X, indicating rising orders compared to shipments, with backlog reaching a record $23.9 billion. Management cited order growth across every segment, supported by strong commercial execution and adoption of new products. Pharmaceutical Diagnostics revenues increased 15.6% year over year to $843 million. Growth was supported by higher contrast-media volumes, pricing and U.S. radiopharmaceutical demand. Segment EBIT was $250 million, up 16.9% year over year. Advanced Imaging Solutions revenues increased 7.9% year over year to $3.77 billion. Growth was supported by CardioVascular and Interventional Solutions, computed tomography and Molecular Imaging. Segment EBIT was $525 million, up 15.4% year over year. Patient Care Solutions revenues declined 13.3% year over year to $675 million. Management attributed the decline primarily to operational and fulfillment challenges, despite strong first-half orders that indicated healthy customer demand. Net income margin expanded 90 basis points to 10.6%. However, net income margin was negatively impacted due to PCS weakness and inflation in memory chips, oil and freight costs. Cumulative cash flow from operating activities at the end of the second quarter was $458 million compared with $344 million a year ago. GEHC exited the second quarter with cash, cash equivalents and restricted cash of $2.11 billion compared with $2.28 billion in the previous quarter. Total assets increased to $37.25 billion from $37.12 billion on a sequential basis. GE HealthCare reaffirmed its guidance for 2026. The company still expects organic revenue growth of 3-4% in 2026. It anticipates adjusted EPS to be in the range of $4.80-$5.00, implying 4.6%-9.0% year-over-year growth, as expected previously. Management anticipates approximately $250 million of inflation associated with memory chips, oil and freight and other components, but expects pricing and cost actions to offset more than half of that impact. The Zacks Consensus Estimate for 2026 revenues and EPS is pegged at $21.71 billion and $4.89, respectively. GE HealthCare Technologies Inc. price-consensus-eps-surprise-chart | GE HealthCare Technologies Inc. Quote GE HealthCare delivered solid second-quarter 2026 results, with both earnings and revenues surpassing the Zacks Consensus Estimate. Growth was driven by strong execution in Pharmaceutical Diagnostics and Advanced Imaging Solutions, supported by healthy demand across the United States, EMEA and Rest of World. However, weakness in Patient Care Solutions, along with inflation in memory chips, oil and freight, weighed on margins. The company is taking focused actions to improve PCS execution and supply performance while reviewing strategic options to maximize its long-term value. Management expects pricing, productivity and cost-control initiatives under its Heartbeat operating model to offset anticipated inflationary impact. The company consolidated Imaging and Advanced Visualization Solutions into the new Advanced Imaging Solutions segment and is integrating its Global Markets organization to create a more connected imaging ecosystem and strengthen commercial capabilities. Its growth strategy remains centered on precision care, innovation-led revenue expansion and business optimization. GEHC formed a $500 million Care Alliance with Catholic Health, expanded theranostics collaborations and installed the first StarGuide GX system at Essen’s Nuclear Medicine Center of Excellence. The company is advancing cloud-enabled enterprise imaging, AI-assisted radiation therapy planning through MIM Contour ProtégéAI+ 2.0 and quantitative PET imaging with MIM KineticID. Robust U.S. radiopharmaceutical demand remains another growth avenue, with Flyrcado positioned to generate more than $500 million annually and Vizamyl targeted to exceed $200 million by 2028. GEHC’s gadolinium-free MRI contrast-agent trial is also progressing, strengthening its focus on precision care and next-generation diagnostic solutions. GE HealthCare has a Zacks Rank #3 (Hold) at present. Some better-ranked stocks from the broader medical space are West Pharmaceutical WST, McKesson MCK and Cardinal Health CAH, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. West Pharmaceutical reported second-quarter 2026 adjusted earnings per share (EPS) of $2.37, which beat the Zacks Consensus Estimate by 13.9%. Revenues of $872.3 million surpassed the Zacks Consensus Estimate by 4.2%. West Pharmaceutical has an estimated long-term earnings growth rate of 14.4%. WST’s earnings surpassed estimates in the trailing four quarters, the average surprise being 17.4%. McKesson reported a fourth-quarter fiscal 2026 adjusted EPS of $11.69, which beat the Zacks Consensus Estimate by 1.1%. Revenues of $96.3 billion missed the Zacks Consensus Estimate by 5.5%. McKesson has an estimated long-term earnings growth rate of 13.7%. MCK’s earnings surpassed estimates in the trailing four quarters, the average surprise being 3.1%. Cardinal Health reported a third-quarter fiscal 2026 adjusted EPS of $3.17, which beat the Zacks Consensus Estimate by 13.2%. Revenues of $60.94 billion missed the Zacks Consensus Estimate by 2.3%. Cardinal Health has an estimated long-term earnings growth rate of 17%. CAH’s earnings surpassed estimates in the trailing four quarters, the average surprise being 10.3%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report GE HealthCare Technologies Inc. (GEHC) : Free Stock Analysis Report Cardinal Health, Inc. (CAH) : Free Stock Analysis Report McKesson Corporation (MCK) : Free Stock Analysis Report West Pharmaceutical Services, Inc. (WST) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research