Philips stays positive despite pandemic-induced declines

Caught in the midst of the COVID-19 crisis, health technology experts Philips took a pounding in the first quarter of 2020. Compared to Q1 2019, total sales slipped by a modest two percent, to 4.159 billion euros. However, it was in net income that the Amsterdam-based company took one on the chin. In Q1 2020, the company saw a profit of 39 million euros – a drop of more than 75 percent from the 162 million it brought in over the same quarter last year.

Despite the hit, Philips sees some signs of encouragement. While its personal health group is expecting a steep decline into Q2, the company’s connected care and diagnosis & treatment sectors have already realized 23 percent growth. This stems from an increase in orders of diagnostic imaging equipment, hospital ventilators and patient monitors. That’s why CEO Frans van Houten is remaining cautiously optimistic: “Assuming we can convert our existing order book for the diagnosis & treatment and connected care businesses as planned, elective procedures normalize and consumer demand gradually improves, we aim to return to growth and improved profitability in the second half of the year.” However, Van Houten also warned that, “Given the current uncertainty and volatility, we’ll not provide more specific guidance for 2020 at this time.”