FMS Stock Rises as Q2 Earnings Beat Estimates, Revenues Gain Y/Y

Fresenius Medical Care AG & Co. FMS reported second-quarter 2025 adjusted earnings per share (EPS) of 52 cents, which surpassed the Zacks Consensus Estimate by 4%. The bottom line improved 36.8% year over year.

FMS’ Revenue Details

Revenues of $5.44 billion (EUR 4,792 million) beat the Zacks Consensus Estimate by 1.6%. The top line increased 1% year over year and 5% at constant currency (cc). Also, revenues were up 7% organically.

Per management, during the second quarter, divestitures realized as part of the portfolio optimization plan hurt revenue development by EUR 6 million. The full-year top-line numbers are anticipated to reflect 100 basis points of negative impact due to the portfolio optimization plan in 2024.

Shares of FMS gained nearly 2.2% in yesterday’s after-market trading. The stock has risen 7.9% year to date against the industry’s decline of 8.8%. The S&P 500 Index has increased 7.4% in the same period.

Segmental Details

Fresenius Medical implemented a new operating model in 2024 and started reporting under two new segments, Care Delivery and Care Enablement.

Care Delivery

The segment’s revenues were down 3% on a year-over-year basis but up 1% at cc. However, revenues gained 4% on an organic basis.

Revenues in the U.S. markets declined 2% reportedly but gained 3% on an organic basis. The top line also improved 3% year over year at cc. Per management, unfavorable exchange rates along with increased mortality due to the severe flu season in the United States in the first months of the year hurt sales in the country. However, this was partially offset by an accelerated number of patient new starts, reimbursement rate increases and a favorable payor mix.

Per management, during the first quarter of 2025, U.S. same-market treatment growth remained flat year over year.

International sales declined 8% reportedly as well as at cc but gained 5% on an organic basis. The decline was due to divestments realized as part of the portfolio optimization plan, which was partially offset by organic growth. The organic growth was supported by accelerated same-market treatment growth of 1.7%.

Care Enablement

The segment’s revenues decreased 1% year over year reportedly but gained 3% at cc as well as organically. Volume growth and continued positive pricing momentum were offset by unfavorable exchange rate effects.

Margin Analysis

In the quarter under review, Fresenius Medical’s gross profit improved 4.2% year over year. The gross margin expanded 90 basis points (bps) to 25.4%.

Selling, general & administrative expenses increased 2.7% on a reported basis. Research and development expenses decreased 17.4% year over year.

Adjusted operating income improved 9.2% from the prior-year quarter’s level. The adjusted operating margin in the second quarter expanded 80 bps to 9.9%.

2025 Guidance

For 2025, Fresenius Medical continues to expect revenue growth to be positive, with a low-single-digit percent rate compared to the prior year. The company also expects operating income to grow by a high-teens to high-twenties percent rate compared to the prior year.

Fresenius Medical Care AG & Co. KGaA Price, Consensus and EPS Surprise

Fresenius Medical Care AG & Co. KGaA price-consensus-eps-surprise-chart | Fresenius Medical Care AG & Co. KGaA Quote

Our Take

FMS exited the second quarter on a strong note, with its earnings and revenues surpassing their respective consensus estimate. Overall pricing momentum also supported growth in the Care Enablement segment. However, the effects of elevated mortality will likely continue to have a negative impact on sales.

Per management, during the first quarter, the FME25 transformation program continued its positive momentum, delivering EUR 58 million additional sustainable savings while related one-time costs, treated as special items, amounted to EUR 53 million. The company confirmed its full-year target of around EUR 180 million in additional annual savings, totaling EUR 1050 million by 2027-end.

FMS’ continued divestment of its non-core and dilutive assets appears promising, as it will help focus on its core and growing categories, while also boosting its cash resources.

FMS’ Zacks Rank & Other Stocks to Consider

Fresenius Medical currently sports a Zacks Rank #1 (Strong Buy).

Some other top-ranked stocks in the broader medical space that have announced quarterly results are Medpace Holdings, Inc. MEDP, West Pharmaceutical Services, Inc. WST and Boston Scientific Corporation BSX.

Medpace Holdings, sporting a Zacks Rank of 1 at present, reported second-quarter 2025 EPS of $3.10, which beat the Zacks Consensus Estimate by 3.3%.  You can see the complete list of today’s Zacks #1 Rank stocks here.

Revenues of $603.3 million outpaced the consensus mark by 11.5%. Medpace Holdings has a long-term estimated growth rate of 11.4%. MEDP’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 13.9%.

West Pharmaceutical reported second-quarter 2025 adjusted EPS of $1.84, which beat the Zacks Consensus Estimate by 21.9%. Revenues of $766.5 million surpassed the Zacks Consensus Estimate by 5.4%. It currently flaunts a Zacks Rank #1.

West Pharmaceutical has a long-term estimated growth rate of 8.5%. WST’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 16.8%.

Boston Scientific reported second-quarter 2025 adjusted EPS of 75 cents, which beat the Zacks Consensus Estimate by 4.2%. Revenues of $5.06 billion surpassed the Zacks Consensus Estimate by 3.5%. It currently carries a Zacks Rank #2 (Buy).

Boston Scientific has a long-term estimated growth rate of 14%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.1%.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research