Sales of imaging equipment and other healthcare technology products may be sluggish in the United States, but emerging markets are driving profits, according to the CEOs of two big-name companies.
The Dutch Royal Philips Electronics (PHIA) saw growing demand for its healthcare products in the second quarter--in stark contrast to this time last year.
The company posted net profit of 167 million euros ($202 million) for Q2 amid increasing demands for its healthcare products. In the same quarter last year, it reported a EUR1.34 billion loss after massive write-downs that were due, in part, to sluggish U.S. healthcare sales, according to The Wall Street Journal.
"In Healthcare, order intake grew 4% year-on-year and, very importantly, orders were up 13% in growth geographies," Philips CEO François Adrianus van Houten said in an earnings call. "As we noted last quarter, we do see headwinds in Europe, where order intake actually declined by 6%. North America order intake declined by 3% in the quarter, as we saw a decrease in order intake for our government business."
Although the healthcare markets are "kind of flat" in the United States and "very tough" in Europe, "the emerging markets in healthcare are pretty dynamic," Inmelt said. He expects healthcare to "go positive" in Q3 and have a solid second half of the year, as well.