Philips delivers solid comparable sales growth and margin in Q2; reiterates full year comparable sales growth outlook; Adjusted EBITA and free cash flow outlook increased to reflect US tariff refund

Philips delivers solid comparable sales growth and margin in Q2; reiterates full year comparable sales growth outlook; Adjusted EBITA and free cash flow outlook increased to reflect US tariff refund

Q2 2026 Group performance Comparable order intake declined 1%, due to timing of certain large orders Group sales of EUR 4.4 billion, reflecting 4% comparable sales growth Income from operations of EUR 609 million, including US tariff refund benefit of EUR 186 million Adjusted EBITA margin increased to 16.4%, including US tariff refund benefit of effectively 4.2% Operating cash flow of EUR 376 million, with free cash flow of EUR 222 million including receipt of US tariff refund 2026 comparable sales growth outlook reiterated; Adjusted EBITA and free cash flow outlook updated to reflect US tariff refund

Roy Jakobs, CEO of Royal Philips: “We delivered another solid quarter with comparable sales growth of 4%, driven by all business segments, and strong disciplined execution within an uncertain macro environment. Customer demand for our innovations remains healthy, with certain large orders in North America shifting into the third quarter, while Europe delivered strong double-digit order growth. Our plan continues to gain traction, creating value through focused segment strategies, differentiated platform innovations, commercial excellence and disciplined execution. We launched SmartIQ for our Azurion image-guided therapy platform and received several new regulatory clearances for our AI-powered innovations. Our teams around the world are focused on delivering better care for more people. We largely completed the US tariff refund process during the quarter and continue to actively manage the broader macro environment, including inflation. Our productivity program is on track, helping to largely offset these pressures. We are strengthening our supply chain resilience as we continue to put quality at the heart of our operations.”

Group and segment performance Comparable order intake declined 1%, with growth in Diagnosis & Treatment offset by the timing of certain large Connected Care orders shifting into the third quarter. Comparable sales increased by 4% in the quarter, driven by growth across all segments. Adjusted EBITA margin increased to 16.4%, including a US tariff refund benefit of effectively 4.2%. Excluding the US tariff refund benefit, Adjusted EBITA slightly decreased mainly due to cost inflation and higher tariffs, partly offset by higher sales and productivity measures. Net cash flows from operating activities remained broadly flat, with higher working capital outflows offset by the US tariff refund. Diagnosis & Treatment comparable sales increased by 2%. Adjusted EBITA margin increased to 13.9%, including a US tariff refund benefit of approximately 4.6%. Excluding the US tariff refund benefit, Adjusted EBITA decreased mainly due to cost inflation, higher tariffs and unfavorable mix effects, partly offset by productivity measures. Connected Care comparable sales increased by 2%. Adjusted EBITA margin increased to 17.8%, including a US tariff refund benefit of approximately 6.1%. Excluding the US tariff refund benefit, Adjusted EBITA increased mainly driven by operational improvements and productivity measures, partly offset by cost inflation and higher tariffs. Personal Health comparable sales increased by 8%. Adjusted EBITA margin increased to 23.0%, including a US tariff refund benefit of approximately 5.0%. Excluding the US tariff refund benefit, Adjusted EBITA increased mainly driven by higher sales and productivity measures, partly offset by cost inflation.

Innovation highlights Philips launched SmartIQ for its Azurion image-guided therapy platform, addressing the trade-off between image quality and radiation dose in coronary procedures. The technology enables...