Cochlear shares tumble after lower profit guidance
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More news: Shares in Cochlear dived nearly 11% to $271.09 in early trading on the ASX after the hearing implant maker cut its expectation for full-year profit. The company now expects FY25 underlying net profit to be at the lower end of its $410 million to $430 million guidance range, due to lower contribution from services revenue and higher cloud-related investment.
What they said: "A disappointing miss caused by Nucleus 8 upgrades which sent Services revenue backwards in the seasonally stronger half... The promise of the next generation implant launch plus the Kanso3 launch should provide a much better backdrop for FY26 but we need to digest the downgrade first which will likely weigh on the stock today," Jarden analysts said in a note.
Cochlear trims FY guidance after half-year profit lift
The news: Hearing implant maker Cochlear posted a 7% increase in half-year profit and lifted its dividend, but moderated its expectation for full-year profit due to lower services revenue.
The numbers: Statutory profit for the six months to December rose 7% to $205.1 million, while underlying net profit was also up 7% to $205.5 million. Revenue was up 7% to $1.17 billion and the company lifted its interim dividend to $2.15 a share from $2.0 a share a year ago.
The context: Cochlear reported strong growth in its core business, with implant revenue up 13% from a year ago and acoustics revenue up 22%. However, this was offset by a 12% decline in services revenue. While the company is preparing to release a number of new products from mid-2025, that momentum is likely to continue in the second half.
As a result, it now expects FY25 underlying net profit to be at the lower end of the $410 million to $430 million guidance range, incorporating a lower contribution from services revenue and higher cloud-related investment of around $40 million for the year.
The source: ASX
