second quarter 2026
Filed Jul 29, 2026GE HealthCare reports second quarter 2026 financial results
Revenue, orders, backlog and Pharmaceutical Diagnostics and Advanced Imaging Solutions results grew, while Patient Care Solutions revenue, EBIT and margin declined sharply. Adjusted EBIT margin fell and operating cash flow included a tariff refund, although the company reaffirmed full-year guidance.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenuesGAAP | $5.3 billion | – | up 5.7% |
| Sales of productsGAAP | $3,416 million | – | – |
| Sales of servicesGAAP | $1,878 million | – | – |
| Organic revenue growthnon-GAAP | 3.5% | – | – |
| Total ordersother | 11.1% organically | – | versus 3.4% growth in the year-ago period |
| Book-to-billother | 1.15 times | – | – |
| Backlogother | $23.9 billion | – | – |
| Gross profitGAAP | $2,180 million | – | – |
| Total operating expensesGAAP | $1,441 million | – | – |
| Operating incomeGAAP | $739 million | – | – |
| Net incomeGAAP | $573 million | – | – |
| Net income attributable to GE HealthCareGAAP | $561 million | – | – |
| Net income marginGAAP | 10.6% | – | up 90 basis points (bps) |
| Adjusted EBITnon-GAAP | $750 million | – | – |
| Adjusted EBIT marginnon-GAAP | 14.2% | – | down 40 bps |
| Basic earnings per share attributable to GE HealthCareGAAP | $1.24 | – | – |
| Diluted earnings per share attributable to GE HealthCareGAAP | $1.24 | – | up $0.18 |
| Adjusted EPSnon-GAAP | $1.13 | – | up $0.07 |
| Cash flow from operating activitiesGAAP | $168 million | – | up $74 million |
| Free cash flownon-GAAP | $68 million | – | up $61 million |
| Capital expendituresother | $100 million | – | – |
| Advanced Imaging Solutions Segment EBITother | $525 million | – | 15.4% |
| Advanced Imaging Solutions Segment EBIT Marginother | 13.9% | – | 90 bps |
| Pharmaceutical Diagnostics Segment EBITother | $250 million | – | 16.9% |
| Pharmaceutical Diagnostics Segment EBIT Marginother | 29.6% | – | 30 bps |
| Patient Care Solutions Segment EBITother | $(26) million | – | (143.0)% |
| Patient Care Solutions Segment EBIT Marginother | (3.8)% | – | (1,150) bps |
| Six-month total revenuesGAAP | $10,425 million | – | – |
| Six-month operating incomeGAAP | $1,254 million | – | – |
| Six-month net income attributable to GE HealthCareGAAP | $950 million | – | – |
| Six-month diluted earnings per share attributable to GE HealthCareGAAP | $2.08 | – | – |
| Six-month cash from operating activitiesGAAP | $458 million | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Advanced Imaging SolutionsOrganic revenue growth was 5.0%. | $3,771 million | – | 7.9% |
| Pharmaceutical DiagnosticsOrganic revenue growth was 14.6%. | $843 million | – | 15.6% |
| Patient Care SolutionsOrganic revenue growth was (13.5)% and financial performance continued to be challenged. | $675 million | – | (13.3)% |
full-year 2026 outlook
- RevenueOrganic revenue growth of 3.0% to 4.0% year-over-year
- Tax rateAdjusted effective tax rate (ETR)* in the range of 20.0% to 21.0%
- NoteAdjusted EBIT margin* of 15.4% to 15.7%, reflecting an expansion of 10 bps to 40 bps year-over-year
- NoteContinue to expect approximately $250 million of inflation associated with memory chips, oil and freight and other components
- NoteAdjusted EPS* in the range of $4.80 to $5.00, representing 4.6% to 9.0% growth year-over-year
- NoteFree cash flow* of approximately $1.6 billion
- NoteThe benefits of refunds for tariffs incurred in 2025 are not included in guidance for 2026 Adjusted EBIT margin* ($106 million to date) and Adjusted EPS* ($0.18 to date)
- NoteThe benefits of refunds for tariffs incurred in 2026 are included in guidance for 2026 Adjusted EBIT margin* ($23 million) and Adjusted EPS* ($0.04)
Capital returns
- The Company repurchased 3.3 million shares for total consideration of $200 million.
- $500 million remaining in the share repurchase program authorized by the Board of Directors in April 2025.
- Declared quarterly dividend of $0.035 per share to stockholders of record as of July 24, 2026.
- For the six months ended June 30, 2026, repurchase of common stock was $(300) million, versus $(100) million for the six months ended June 30, 2025.
- For the six months ended June 30, 2026, dividends paid to stockholders were $(32) million, versus $(32) million for the six months ended June 30, 2025.
What drove it
- Revenue growth was driven by Pharmaceutical Diagnostics and Advanced Imaging Solutions.
- The company cited overall strength in the U.S., Europe, the Middle East, and Africa (EMEA), and Rest of World.
- Orders growth occurred across every segment, according to the CEO.
- Current-period net income benefited from International Emergency Economic Powers Act (IEEPA) tariff refunds recognized of $129 million.
- Current-period Adjusted EBIT benefited from IEEPA tariff refunds recognized of $23 million.
- Diluted EPS and Adjusted EPS benefited from tariff refunds and a lower tax rate.
- The company continues to prioritize investment in capacity expansion and innovation.
- GE HealthCare combined its Imaging and Advanced Visualization Solutions businesses into Advanced Imaging Solutions; historical segment financial information was recast to conform to the new structure.
Concerns
- Patient Care Solutions financial performance continued to be challenged.
- Patient Care Solutions reported revenue growth of (13.3)%, Segment EBIT of $(26) million and Segment EBIT Margin of (3.8)%.
- Net income margin and Adjusted EBIT margin were negatively impacted by a decline in Patient Care Solutions and inflation related to memory chips, oil and freight costs.
- Adjusted EBIT margin declined 40 bps from 14.6% to 14.2%.
- The company continues to expect approximately $250 million of inflation associated with memory chips, oil and freight and other components.
- Tariff refunds of $106 million related to 2025 were excluded from Adjusted EBIT results.
What to watch
- The return of Patient Care Solutions to growth and profitability and the company's review of strategic options to maximize its long-term value.
- Whether record backlog of $23.9 billion and book-to-bill of 1.15 times support full-year organic revenue growth guidance of 3.0% to 4.0%.
- Progress toward full-year Adjusted EBIT margin guidance of 15.4% to 15.7% amid expected inflation.
- The effect of additional tariff refunds, for which the company does not expect a material benefit to Adjusted EBIT margin and Adjusted EPS from additional refunds for tariffs incurred in 2026.
- Conversion toward free cash flow guidance of approximately $1.6 billion.
Balance sheet and cash flow
- Cash and cash equivalents of $2.1 billion.
- Access to $3.5 billion of revolving credit facilities.
- Total debt outstanding of $10.1 billion.
- Cash, cash equivalents, and restricted cash were $2,105 million as of June 30, 2026, versus $4,512 million as of December 31, 2025.
- Long-term borrowings were $10,091 million as of June 30, 2026, versus $9,495 million as of December 31, 2025.
- Total assets were $37,246 million as of June 30, 2026, versus $36,906 million as of December 31, 2025.
- Cash flow from operating activities includes a tariff refund of $107 million.
- For the six months ended June 30, 2026, additions to property, plant and equipment and internal-use software were $(278) million, versus $(238) million.
- For the six months ended June 30, 2026, purchases of businesses, net of cash acquired were $(2,293) million, versus $(279) million.
- For the six months ended June 30, 2026, newly issued debt, net of debt issuance costs were $1,152 million, versus $1,493 million.
- For the six months ended June 30, 2026, repayments and other reductions were $(1,012) million, versus $(261) million.
Analysis
GE HealthCare reported second-quarter revenue of $5.3 billion, up 5.7%, with organic revenue growth of 3.5%. Order momentum was stronger than revenue, with total orders up 11.1% organically, book-to-bill of 1.15 times and backlog of $23.9 billion. Management attributed revenue growth to Pharmaceutical Diagnostics and Advanced Imaging Solutions, with strength in the U.S., EMEA and Rest of World.
Segment performance was uneven. Advanced Imaging Solutions generated $3,771 million of revenue, up 7.9%, and Pharmaceutical Diagnostics generated $843 million, up 15.6%. Their Segment EBIT margins were 13.9% and 29.6%, respectively. Patient Care Solutions generated $675 million of revenue, down (13.3)%, posted Segment EBIT of $(26) million and had a Segment EBIT Margin of (3.8)%. The company said it is reviewing strategic options for Patient Care Solutions while working to return that business to growth and profitability.
GAAP profitability improved, with net income attributable to GE HealthCare of $561 million versus $486 million and diluted EPS of $1.24 versus $1.06. Net income margin rose to 10.6% from 9.7%. Adjusted EBIT increased to $750 million from $729 million, but Adjusted EBIT margin decreased to 14.2% from 14.6%. The filing identifies the Patient Care Solutions decline and inflation related to memory chips, oil and freight costs as negative margin factors. Current-period net income and Adjusted EBIT also benefited from IEEPA tariff refunds recognized of $129 million and $23 million, respectively.
Second-quarter cash flow from operating activities was $168 million and included a tariff refund of $107 million, while free cash flow was $68 million. The company deployed $200 million to repurchase 3.3 million shares and declared a quarterly dividend of $0.035 per share. Cash and cash equivalents were $2.1 billion, total debt outstanding was $10.1 billion and the company had access to $3.5 billion of revolving credit facilities.
Management reaffirmed full-year 2026 guidance for organic revenue growth of 3.0% to 4.0%, Adjusted EBIT margin of 15.4% to 15.7%, Adjusted EPS of $4.80 to $5.00 and free cash flow of approximately $1.6 billion. The outlook continues to incorporate approximately $250 million of expected inflation tied to memory chips, oil and freight and other components. It includes benefits from tariffs incurred in 2026 but excludes benefits from refunds for tariffs incurred in 2025.
Management, verbatim
We delivered record orders and backlog in the second quarter, with orders growth across every segment, demonstrating strong commercial execution, including the adoption of new products.
Peter Arduini, GE HealthCare President and CEO
In Patient Care Solutions, while we are focused on returning the business to growth and profitability, we are reviewing strategic options to maximize its long-term value.
Peter Arduini, GE HealthCare President and CEO
Our continued investment in precision innovation is expanding our addressable markets, strengthening our competitive position and supporting durable short- and long-term growth.
Peter Arduini, GE HealthCare President and CEO
Not in the filing
stated, not guessed- Prior-quarter comparisons for reported metrics
- Quarterly gross margin
- Quarterly tax rate
- Prior-year quarterly cash flow from operating activities stated as an absolute amount
- Prior-year quarterly free cash flow stated as an absolute amount
- Prior outlook for comparison
- Adjusted EBIT and Adjusted EPS reconciliation tables beyond the information included in the provided filing text
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.