(Reuters) - Abbott Laboratories beat analysts’ estimates for quarterly profit and lifted its full-year earnings forecast on Wednesday, boosted by a near 64% jump in sales of its blood sugar monitoring device.
Shares rose 4% to a record high of $86.59, adding to the about 15% gain since the start of the year.
Abbott is betting on the device, FreeStyle Libre, and is working on newer versions to cushion slowing growth in some of its older products.
The continuous glucose monitor, which helps diabetics track blood sugar levels without having to prick their fingers, is used by more than 1.5 million people worldwide.
FreeStyle Libre 2, the next-generation device, which is already approved in Europe, is now under U.S. regulatory review.
To expand its reach, Abbott plans to ramp up manufacturing capacity for FreeStyle Libre by three to five times in the next few years, Reuters reported on Tuesday.
When asked on the conference call what that increased capacity could mean, Chief Executive Miles White said he sees potential for Libre to bring in annual sales of $5 billion “in a reasonable time”.
Libre’s sales are expected to reach $1.5 billion this year, the company has said.
Abbott is also focusing on another growth driver, MitraClip. Sales of the device used for heart valve repair jumped 26.7% to $169 million in the quarter.
Momentum continues for Abbott’s key growth drivers and “we don’t believe it is slowing down any time soon”, BMO Capital Markets analyst Joanne Wuensch wrote in a client note.
Sales of FreeStyle Libre rose 63.9% on a reported basis to $433 million in the second quarter.
Total sales at the diabetes unit jumped 28.2% and helped Abbott’s medical devices division report a 6.4% rise in revenue to $3.08 billion.
(For an interactive graphic on diabetes unit sales, click here: tmsnrt.rs/32yCqje)
Abbott raised its 2019 forecast for adjusted earnings from continuing operations to $3.21 to $3.27 per share, from its prior forecast of $3.15 to $3.25 per share.
The company’s net earnings rose 37% to $1 billion in the second quarter ended June 30.
Excluding items, Abbott earned 82 cents per share, ahead of the average analyst estimate of 80 cents, according to IBES data from Refinitiv.
Net sales rose 2.7% to $7.98 billion, but missed estimates of $8 billion.
Reporting by Saumya Sibi Joseph and Manas Mishra in Bengaluru; Editing by Sriraj Kalluvila