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Philips CEO Throws Cold Water on 2026 Growth Hopes as Tariffs Loom Larger

MarketDash Editorial Team
3 days ago
CEO Roy Jakobs told investors to pump the brakes on 2026 expectations, warning that tariff pressures are nearly doubling and the company's growth trajectory won't hit Wall Street's ambitious targets.

Sometimes the market just wants good news, and Koninklijke Philips (PHG) CEO Roy Jakobs wasn't delivering it. Speaking at Citi's Global Healthcare Conference, Jakobs essentially told investors to lower their expectations for 2026, triggering the stock's steepest drop since February.

Here's the issue: Philips is growing, but not nearly fast enough to satisfy Wall Street's optimism. The company expects organic sales growth to climb from about 2% this year toward mid-single digits by 2026. That sounds fine until you realize analysts were modeling 4.5% growth. Jakobs made it clear that number is "unlikely" to happen.

Tariffs Are About to Get Real

Adding to the headache, Philips warned that tariff pressures next year are expected to nearly double compared to current levels. According to Citi analysts summarizing the conference remarks, the company still aims to expand margins in 2026, but those tariff costs are going to make that journey considerably harder.

The global backdrop isn't helping much either. Philips expects hospital capital spending patterns in 2026 to look pretty similar to 2025: strong demand in the United States, solid performance in Europe and international markets, but continued weakness in China. Nothing terrible, nothing spectacular.

No Early Guidance, Despite the Questions

Investors hoping for more clarity will have to wait. In a statement issued Thursday, Philips reaffirmed that its official 2026 outlook will be released on February 10, 2026, exactly as scheduled. No early peek, no preview, no handholding.

The company did reiterate its expectations for continued performance improvement: sequential comparable sales growth, expanding margins despite those tariff pressures, and strong cash flow generation. Philips emphasized that its path toward mid-single-digit growth will be sequential and gradual, clarifying that this trajectory doesn't mean doubling growth every single year.

At the conference, Jakobs confirmed the company expects to accelerate toward mid-single-digit growth sequentially, but stressed that this is a multi-year journey with realistic, measured steps rather than dramatic leaps.

Recent Performance Was Actually Pretty Good

Ironically, Philips' most recent quarterly results were solid. The company reported third-quarter 2025 adjusted earnings of 42 cents per share (or 0.36 euros), beating the consensus estimate of 37 cents. Quarterly sales came in at $5.03 billion (4.302 billion euros), right in line with expectations.

But in the stock market, past performance matters less than future expectations. And right now, those expectations are being reset lower.

PHG Price Action: Koninklijke Philips shares closed down 5.33% at $26.54 on Thursday.

Back to News

Philips CEO Throws Cold Water on 2026 Growth Hopes as Tariffs Loom Larger

MarketDash Editorial Team
3 days ago
CEO Roy Jakobs told investors to pump the brakes on 2026 expectations, warning that tariff pressures are nearly doubling and the company's growth trajectory won't hit Wall Street's ambitious targets.

Sometimes the market just wants good news, and Koninklijke Philips (PHG) CEO Roy Jakobs wasn't delivering it. Speaking at Citi's Global Healthcare Conference, Jakobs essentially told investors to lower their expectations for 2026, triggering the stock's steepest drop since February.

Here's the issue: Philips is growing, but not nearly fast enough to satisfy Wall Street's optimism. The company expects organic sales growth to climb from about 2% this year toward mid-single digits by 2026. That sounds fine until you realize analysts were modeling 4.5% growth. Jakobs made it clear that number is "unlikely" to happen.

Tariffs Are About to Get Real

Adding to the headache, Philips warned that tariff pressures next year are expected to nearly double compared to current levels. According to Citi analysts summarizing the conference remarks, the company still aims to expand margins in 2026, but those tariff costs are going to make that journey considerably harder.

The global backdrop isn't helping much either. Philips expects hospital capital spending patterns in 2026 to look pretty similar to 2025: strong demand in the United States, solid performance in Europe and international markets, but continued weakness in China. Nothing terrible, nothing spectacular.

No Early Guidance, Despite the Questions

Investors hoping for more clarity will have to wait. In a statement issued Thursday, Philips reaffirmed that its official 2026 outlook will be released on February 10, 2026, exactly as scheduled. No early peek, no preview, no handholding.

The company did reiterate its expectations for continued performance improvement: sequential comparable sales growth, expanding margins despite those tariff pressures, and strong cash flow generation. Philips emphasized that its path toward mid-single-digit growth will be sequential and gradual, clarifying that this trajectory doesn't mean doubling growth every single year.

At the conference, Jakobs confirmed the company expects to accelerate toward mid-single-digit growth sequentially, but stressed that this is a multi-year journey with realistic, measured steps rather than dramatic leaps.

Recent Performance Was Actually Pretty Good

Ironically, Philips' most recent quarterly results were solid. The company reported third-quarter 2025 adjusted earnings of 42 cents per share (or 0.36 euros), beating the consensus estimate of 37 cents. Quarterly sales came in at $5.03 billion (4.302 billion euros), right in line with expectations.

But in the stock market, past performance matters less than future expectations. And right now, those expectations are being reset lower.

PHG Price Action: Koninklijke Philips shares closed down 5.33% at $26.54 on Thursday.