Roy Jacobs reports Philips order intakes declined 1% as the company navigates tariff impacts and cost inflation
Philips CEO Roy Jacobs reported on Tuesday that order intakes for the Dutch health tech giant declined by 1% due to the timing of large orders. While group sales grew by 4.4% to 4.4 billion euros, the company faced challenges from cost inflation and higher tariffs. Jacobs noted that the decline was a result of 'lumpiness' and 'volatility' in order growth following six consecutive quarters of strong performance. To address these challenges, Philips is implementing cost-cutting and productivity initiatives aimed at the 2026 to 2028 program. The company also reported that its free cash flow for the remainder of the year is projected to be between 1.5 and 1.7 billion euros, bolstered by a tariff refund. Jacobs expressed a cautious but realistic view on the U.S. tariffs, stating that while they hit patient care innovation, they are a business reality that the company must manage. The company's adjusted EBITA grew by 16.4%, partially supported by a 186 million euro tariff refund.