GE Healthcare Lowers 2025 Earnings Outlook as Tariffs Bite, Despite Strong Q1 Performance

GE Healthcare has revised its 2025 adjusted earnings guidance downward, citing an expected 85-cent-per-share hit from global tariffs—primarily those tied to U.S.-China trade tensions, executives said during an earnings call. 

CEO Peter Arduini noted that tariffs between the U.S. and China account for about 75% of the projected impact. As a result, GE Healthcare now forecasts full-year adjusted earnings between \$3.90 and \$4.10 per share, down from the earlier range of $4.61 to $4.75. 

The outlook reflects the assumption that current elevated tariff levels will persist, including the U.S.’s reciprocal tariffs on countries outside North America, which are expected to revert to pre-pause levels by July 9. Tariffs on imports from Mexico and Canada are also assumed to stay, with U.S.-Mexico-Canada Agreement (USMCA) exemptions still in effect. 

To mitigate the impact, the company is optimizing supply chains, improving USMCA compliance, and exploring logistics adjustments. Without these actions, the gross tariff burden would have been about \$1.75 per share, Arduini said. CFO Jay Saccaro added that GE Healthcare is also evaluating dual sourcing and localized manufacturing strategies to further reduce tariff risk. 

Despite the drag from trade policy, GE Healthcare posted stronger-than-expected first-quarter revenue and profit, fueled by robust demand in the U.S. Arduini highlighted double-digit order growth, particularly in imaging equipment for cardiology and oncology, with the company gaining market share in several regions. 

Stifel analyst Rick Wise praised the company’s Q1 results, calling them “truly positive” and noting resilience in its China operations. Saccaro, meanwhile, emphasized that hospital capital spending remains stable, with GE Healthcare’s backlog reaching record levels and no notable cancellations so far linked to the evolving trade environment.