Philips delivers on Q1 results, with ongoing order intake growth
Philips (PHG) reported Q1 2025 results with mixed performance. Group sales reached EUR 4.1 billion, showing a 2% decline in comparable sales growth, primarily due to challenges in China. Despite this, comparable order intake increased by 2%, driven by strong performance in North America. The company's income from operations increased to EUR 154 million, while Adjusted EBITA margin declined 80 bps to 8.6%.
Notable developments include a EUR 1,091 million free cash outflow, largely due to a EUR 1,025 million payment for Philips Respironics recall-related settlements. The company updated its full-year 2025 outlook, maintaining sales growth guidance at 1-3% but reducing Adjusted EBITA margin to 10.8-11.3%, factoring in an estimated EUR 250-300 million tariff impact. Free cash flow is expected to be slightly positive for the full year.
Philips (PHG) ha comunicato i risultati del primo trimestre 2025 con performance contrastanti. Le vendite del gruppo hanno raggiunto 4,1 miliardi di EUR, registrando un calo del 2% nelle vendite comparabili, principalmente a causa delle difficoltà in Cina. Nonostante ciò, l'ordine comparabile è aumentato del 2%, trainato da una solida performance in Nord America. Il reddito operativo è salito a 154 milioni di EUR, mentre il margine Adjusted EBITA è diminuito di 80 punti base, attestandosi all'8,6%.
Tra gli sviluppi rilevanti si segnala un esborso di cassa libero di 1.091 milioni di EUR, dovuto in gran parte a un pagamento di 1.025 milioni di EUR per accordi legati al richiamo Philips Respironics. L'azienda ha aggiornato le previsioni per l'intero 2025, mantenendo la crescita delle vendite prevista tra l'1% e il 3%, ma riducendo il margine Adjusted EBITA al 10,8-11,3%, considerando un impatto stimato tra 250 e 300 milioni di EUR dovuto ai dazi. Il flusso di cassa libero per l'intero anno è previsto leggermente positivo.
Philips (PHG) informó resultados del primer trimestre de 2025 con un desempeño mixto. Las ventas del grupo alcanzaron los 4.100 millones de EUR, mostrando una caída del 2% en ventas comparables, principalmente debido a desafíos en China. A pesar de esto, la entrada de pedidos comparables aumentó un 2%, impulsada por un fuerte desempeño en América del Norte. Los ingresos operativos de la compañía aumentaron a 154 millones de EUR, mientras que el margen Adjusted EBITA disminuyó 80 puntos básicos hasta el 8,6%.
Entre los desarrollos destacados se incluye una salida de efectivo libre de 1.091 millones de EUR, en gran parte debido a un pago de 1.025 millones de EUR relacionado con acuerdos por el retiro de Philips Respironics. La empresa actualizó su perspectiva para todo el año 2025, manteniendo la guía de crecimiento de ventas entre 1-3%, pero reduciendo el margen Adjusted EBITA a 10,8-11,3%, considerando un impacto estimado de tarifas de entre 250 y 300 millones de EUR. Se espera que el flujo de caja libre sea ligeramente positivo para todo el año.
필립스 (PHG)는 2025년 1분기 실적을 발표했으며, 성과는 엇갈렸습니다. 그룹 매출은 41억 유로에 달했으며, 주로 중국에서의 어려움으로 인해 비교 가능한 매출 성장률이 2% 감소했습니다. 그럼에도 불구하고, 북미 지역의 강력한 실적으로 인해 비교 가능한 주문 수주는 2% 증가했습니다. 회사의 영업이익은 1억 5,400만 유로로 증가했으나, 조정 EBITA 마진은 80bp 하락하여 8.6%를 기록했습니다.
주요 사항으로는 10억 9,100만 유로의 자유 현금 유출이 있었으며, 이는 주로 필립스 레스피로닉스 리콜 관련 합의금으로 10억 2,500만 유로를 지불한 데 기인합니다. 회사는 2025년 전체 연간 전망을 업데이트하여 매출 성장률 가이던스는 1-3%로 유지했으나, 조정 EBITA 마진은 관세 영향 추정치 2억 5,000만~3억 유로를 반영하여 10.8-11.3%로 하향 조정했습니다. 연간 자유 현금 흐름은 약간 긍정적일 것으로 예상됩니다.
Philips (PHG) a publié des résultats du premier trimestre 2025 mitigés. Le chiffre d'affaires du groupe a atteint 4,1 milliards d'euros, affichant une baisse de 2 % de la croissance des ventes comparables, principalement en raison de difficultés en Chine. Malgré cela, la prise de commandes comparable a augmenté de 2 %, portée par une solide performance en Amérique du Nord. Le résultat d'exploitation de l'entreprise est passé à 154 millions d'euros, tandis que la marge EBITA ajustée a diminué de 80 points de base pour s'établir à 8,6 %.
Parmi les faits marquants, on note une sortie de trésorerie libre de 1 091 millions d'euros, principalement liée à un paiement de 1 025 millions d'euros pour des règlements liés au rappel Philips Respironics. L'entreprise a mis à jour ses prévisions pour l'ensemble de l'année 2025, maintenant ses objectifs de croissance des ventes entre 1 et 3 %, mais réduisant la marge EBITA ajustée à 10,8-11,3 %, en tenant compte d'un impact estimé des droits de 250 à 300 millions d'euros. Le flux de trésorerie libre devrait être légèrement positif sur l'année complète.
Philips (PHG) meldete gemischte Ergebnisse für das erste Quartal 2025. Der Konzernumsatz erreichte 4,1 Milliarden EUR und verzeichnete einen Rückgang des vergleichbaren Umsatzwachstums um 2 %, hauptsächlich bedingt durch Herausforderungen in China. Trotz dessen stieg der vergleichbare Auftragseingang um 2 %, angetrieben durch eine starke Leistung in Nordamerika. Das operative Ergebnis des Unternehmens stieg auf 154 Millionen EUR, während die bereinigte EBITA-Marge um 80 Basispunkte auf 8,6 % sank.
Bemerkenswerte Entwicklungen umfassen einen freien Cashflow-Abfluss von 1.091 Millionen EUR, der hauptsächlich auf eine Zahlung von 1.025 Millionen EUR im Zusammenhang mit Rückrufvereinbarungen von Philips Respironics zurückzuführen ist. Das Unternehmen aktualisierte seine Prognose für das Gesamtjahr 2025, behält das Umsatzwachstumsziel von 1-3 % bei, senkt jedoch die bereinigte EBITA-Marge auf 10,8-11,3 %, wobei ein geschätzter Tarif-Einfluss von 250-300 Millionen EUR berücksichtigt wird. Der freie Cashflow wird für das Gesamtjahr voraussichtlich leicht positiv sein.
- Comparable order intake increased 2%, driven by strong North American performance
- Personal Health segment showed 1% comparable sales growth
- Productivity initiatives delivered EUR 147 million in Q1 savings
- Strong performance in Image-Guided Therapy business
- Leading applicant in medical technology patents at European Patent Office
- 2% decline in comparable sales growth, mainly due to China performance
- Adjusted EBITA margin declined 80 bps to 8.6%
- EUR 1,091 million free cash outflow, including EUR 1,025 million recall-related settlement
- Reduced full-year Adjusted EBITA margin outlook due to tariff impact
- Double-digit sales declines across all segments in China
Insights
Philips delivered mixed Q1 with continued order growth despite sales decline, but reduced margin guidance due to tariff impacts.
Philips reported EUR 4.1 billion in Q1 sales with a 2% decline in comparable sales growth, primarily due to double-digit declines across all segments in China. Despite these headwinds, the company maintained positive momentum with 2% comparable order intake growth, driven by strong performance in North America offsetting Chinese market weakness.
Profitability shows increasing pressure, with Adjusted EBITA margin declining 80 basis points to 8.6% of sales. While income from operations increased to EUR 154 million, a significant concern is the EUR 1,091 million free cash outflow, largely from a EUR 1,025 million payment for Respironics recall-related settlements.
Performance varied across segments: Diagnosis & Treatment saw a 4% sales decrease, though Image-Guided Therapy maintained strong performance; Connected Care sales remained flat with a modest 3.5% EBITA margin; and Personal Health achieved 1% comparable sales growth despite China's decline.
The company's productivity initiatives delivered EUR 147 million in Q1 savings, on track for EUR 800 million in 2025 savings, showing management's focus on cost control amid challenges.
In response to trade tensions, Philips updated its 2025 outlook: while maintaining 1-3% comparable sales growth, the company reduced its Adjusted EBITA margin range to 10.8-11.3% (a 100 basis point reduction) due to an estimated EUR 250-300 million net tariff impact. Free cash flow is now expected to be only slightly positive after the recall-related payment, with performance weighted toward the second half of 2025.
Philips advances AI-powered imaging and cloud solutions while expanding partnerships, despite ongoing recall challenges affecting financials.
Philips maintains its innovation leadership position, recognized as the top medical technology patent applicant at the European Patent Office and ranked first among medical technology companies in Clarivate's Top 100 Global Innovators 2025.
The company is advancing AI capabilities across its diagnostic portfolio. Its MRI systems now integrate advanced AI algorithms through SmartSpeed Precise with Dual-AI engines. In ultrasound, the EPIQ Elite and Affiniti systems feature AI-driven Elevate software, while the Compact Ultrasound 5500CV uses AI to reduce cardiac imaging time by 50%, improving clinical workflow efficiency.
Clinical evidence supports these innovations' efficacy. Trial results for the Dynamic Coronary Roadmap showed a 28.8% reduction in contrast media use during percutaneous coronary interventions, addressing an important clinical need by potentially reducing contrast-induced complications.
The company is expanding hospital partnerships in Belgium, Sweden, and Brazil to improve patient monitoring and modernize clinical workflows, demonstrating continued focus on healthcare digitalization.
Philips' cloud strategy advances with the European launch of HealthSuite cloud services hosted on AWS. In the US, new partnerships include Rochester Regional Health's migration of 12 million medical imaging studies to the cloud and Mass General Brigham's integration of device data through the Capsule platform.
Despite innovation momentum, the EUR 1,025 million Respironics recall-related settlement payment and ongoing US Department of Justice investigation remain significant concerns. The company notes its outlook excludes potential impacts from ongoing Respironics-related proceedings, indicating continued uncertainty in this area.
May 6, 2025
Q1 2025 Group performance
- Group sales EUR 4.1 billion, reflecting a
2% decline in comparable sales growth mainly due to China; slightly ahead of company outlook due to Personal Health growth and royalty phasing - Comparable order intake increased
2% despite China decline - Income from operations increased to EUR 154 million
- Adjusted EBITA margin declined 80 bps to
8.6% of sales, driven by sales phasing - Free cash outflow of EUR 1,091 million included EUR 1,025 million payment for Philips Respironics recall-related medical monitoring and personal injury settlements in US
- Updated full year 2025 outlook for Adjusted EBITA margin and free cash flow; sales outlook remains unchanged
Roy Jakobs, CEO of Royal Philips:
“We remain dedicated to serving our customers, driving profitable growth and delivering better care for more people. Our order intake growth continued with strong momentum particularly in the US, coupled with positive growth in personal health, providing an encouraging start to the year.
In an uncertain macro environment that has intensified due to the potential impact of tariffs, we are focused on what we can control. We are improving our supply chain agility, taking decisive cost actions to mitigate financial impact where possible, and ensuring we can continue to serve our customers and consumers.
Patients around the world rely on our medical technology and innovations every day. We are committed to ensuring access to care as we focus on execution, with patient safety and quality as our number one priority.”
Group and segment performance
Comparable order intake increased
Group comparable sales decreased
Adjusted EBITA margin decreased 80 basis points to
Diagnosis & Treatment comparable sales decreased by
Connected Care comparable sales were broadly flat across businesses and Adjusted EBITA margin was
Personal Health comparable sales increased
Innovation highlights
- Philips was the leading applicant in medical technology at the European Patent Office (EPO) in 2024, and Clarivate recognized Philips as the top-ranked medical technology company in the Top 100 Global Innovators 2025.
- Philips introduced new AI technologies to accelerate precise imaging and enhance patient outcomes. In MRI systems, advanced AI algorithms are integrated through SmartSpeed Precise powered by Dual-AI engines. In ultrasound, innovative Elevate software in EPIQ Elite and Affiniti ultrasound systems is enhanced by AI, and AI-driven measurement capabilities for the Compact Ultrasound 5500CV is proven to reduce cardiac imaging time by
50% . - Philips signed partnerships to improve patient monitoring and modernize workflows with Citadelle Hopital in Belgium, the region of Norrbotten in Sweden, and Hospital Israelita Albert Einstein in Brazil.
- Philips’ Dynamic Coronary Roadmap reduces contrast media use by
28.8% during an Image-Guided Therapy procedure to open blocked coronary arteries, called percutaneous coronary intervention (PCI), according to findings from the DCR4Contrast trial. A secondary analysis highlighted further benefits for complex conditions. - HealthSuite’s innovative cloud services launched in Europe, managed by Philips and hosted on AWS. In the US, approximately 12 million medical imaging studies will be migrated to the cloud for Rochester Regional Health in New York, and in Massachusetts, a partnership with Mass General Brigham will integrate device data via the vendor-agnostic Capsule Medical Device Information Platform.
Productivity
Productivity initiatives delivered savings of EUR 147 million in Q1: operating model savings of EUR 42 million, procurement savings of EUR 46 million, and other programs savings of EUR 59 million; Philips is on track to deliver savings of EUR 800 million in 2025. Since 2023, productivity initiatives have delivered savings of more than EUR 1.9 billion.
Outlook
In an uncertain macro environment, Philips’ outlook for full year 2025 is updated to include the assumed impact of currently announced tariffs. This includes current bilateral US-China and rest of world tariffs, the resumption of the paused US tariffs on July 9 and excludes potential wider economic impact.
- Philips’ outlook for comparable sales growth remains unchanged at
1% -3% - Adjusted EBITA margin range to be
10.8% -11.3% , including an estimated net tariff impact of EUR 250-300 million after substantial tariff mitigations, a 100 bps reduction versus previous outlook, based on the above-referenced assumptions - As a result, free cash flow to be slightly positive for the full year, after the payout of EUR 1,025 million Philips Respironics recall-related medical monitoring and personal injury settlements in the US
- The company continues to anticipate 2025 performance will be skewed toward the latter part of the year, with Q2 showing modest improvement from Q1.
This outlook excludes ongoing Philips Respironics-related proceedings, including the investigation by the US Department of Justice.
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For further information, please contact:
Michael Fuchs
Philips Global External Relations
Tel.: +31 6 1486 9261
E-mail: michael.fuchs@philips.com
Dorin Danu
Philips Investor Relations
Tel.: +31 20 59 77055
E-mail: dorin.danu@philips.com
About Royal Philips
Royal Philips (NYSE: PHG, AEX: PHIA) is a leading health technology company focused on improving people’s health and well-being through meaningful innovation. Philips’ patient- and people-centric innovation leverages advanced technology and deep clinical and consumer insights to deliver personal health solutions for consumers and professional health solutions for healthcare providers and their patients in the hospital and the home.
Headquartered in the Netherlands, the company is a leader in diagnostic imaging, ultrasound, image-guided therapy, monitoring and enterprise informatics, as well as in personal health. Philips generated 2024 sales of EUR 18 billion and employs approximately 67,200 employees with sales and services in more than 100 countries. News about Philips can be found at www.philips.com/newscenter.
Forward-looking statements and other important information
Forward-looking statements
This document and the related oral presentation, including responses to questions following the presentation, contain certain forward-looking statements with respect to the financial condition, results of operations and business of Philips and certain of the plans and objectives of Philips with respect to these items. Examples of forward-looking statements include statements made about our strategy, estimates of sales growth, future Adjusted EBITA*), future restructuring and acquisition-related charges and other costs, future developments in Philips’ organic business and the completion of acquisitions and divestments. Forward-looking statements can be identified generally as those containing words such as “anticipates”, “assumes”, “believes”, “estimates”, “expects”, “should”, “will”, “will likely result”, “forecast”, “outlook”, “projects”, “may” or similar expressions. By their nature, these statements involve risk and uncertainty because they relate to future events and circumstances and there are many factors that could cause actual results and developments to differ materially from those expressed or implied by these statements.
These factors include, but are not limited to, macro-economic and geopolitical changes – including the war in Ukraine and ongoing conflicts in Israel and the Middle East – as well as measures such as announced and proposed tariffs and trade actions introduced in response to rising global tensions; Philips’ ability to keep pace with the changing health technology environment; Philips’ ability to gain leadership in health informatics and artificial intelligence in response to developments in the health technology industry; integration of acquisitions and their delivery on business plans and value creation expectations; ability to meet expectations with respect to ESG-related matters; securing and maintaining Philips’ intellectual property rights, and unauthorized use of third-party intellectual property rights; failure of products and services to meet quality or security standards, adversely affecting patient safety and customer operations; the resilience of our supply chain; challenges in simplifying our organization and our ways of working; attracting and retaining personnel; breach of cybersecurity; challenges in driving operational excellence and speed in bringing innovations to market; treasury and financing risks; tax risks; reliability of internal controls; compliance with regulations and standards involving quality, product safety, (cyber) security and artificial intelligence; and compliance with business conduct rules and regulations including privacy, existing and upcoming ESG disclosure and due diligence requirements. As a result, Philips’ actual future results may differ materially from the plans, goals and expectations set forth in such forward-looking statements. For a discussion of factors that could cause future results to differ from such forward-looking statements, see also the Risk management chapter included in the Annual Report 2024.
Third-party market share data
Statements regarding market share contained in this document, including those regarding Philips’ competitive position, are based on outside sources such as specialized research institutes, as well as industry and dealer panels, in combination with management estimates. Where information is not yet available to Philips, market share statements may also be based on estimates and projections prepared by management and/or based on outside sources of information. Management’s estimates of rankings are based on order intake or sales, depending on the business.
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This press release contains inside information within the meaning of Article 7(1) of the EU Market Abuse Regulation.
Use of non-IFRS information
In presenting and discussing the Philips Group’s financial position, operating results and cash flows, management uses certain non-IFRS financial measures. These non-IFRS financial measures should not be viewed in isolation as alternatives to the equivalent IFRS measure and should be used in conjunction with the most directly comparable IFRS measures. Non-IFRS financial measures do not have standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. A reconciliation of these non-IFRS measures to the most directly comparable IFRS measures is contained in this document. Further information on non-IFRS measures can be found in the Annual Report 2024.
Presentation
All amounts are in millions of euros unless otherwise stated. Due to rounding, amounts may not add up precisely to totals provided. All reported data is unaudited. Financial reporting is in accordance with the accounting policies as stated in the Annual Report 2024. Per share calculations have been adjusted retrospectively for all periods presented to reflect the issuance of shares in the second quarter of 2024 in connection with the 2023 share dividend.
*) Non-IFRS financial measure. Refer to Reconciliation of non-IFRS information.
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