Philips delivers strong order intake growth, comparable sales growth and strong margin expansion in Q3; 2026 outlook reiterated

The reiterated annual outlook includes tariff refund benefits of approximately 1% in adjusted EBITA margin and EUR 200 million in free cash flow.

Rhea-AI Summary

Philips (PHG) reported third-quarter 2026 sales of EUR 4.4 billion, with comparable growth and higher adjusted margins across all business segments.

Comparable sales rose 3% and comparable order intake grew 8%. Income from operations was EUR 165 million. Adjusted EBITA margin increased 70 basis points to 13.0%. Operating cash flow increased to EUR 544 million, and free cash flow increased to EUR 384 million.

Diagnosis & Treatment comparable sales were flat; Connected Care grew 5% and Personal Health grew 8%. Productivity initiatives delivered EUR 170 million in quarterly net savings. Philips reiterated its 2026 outlook for comparable sales growth of 3%-4.5%, adjusted EBITA margin of 13.5%-14.0% and free cash flow of EUR 1.5-1.7 billion. The company also issued EUR 650 million in fixed-rate notes due 2034.

23 points · 0 major

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0 major · 4 points

Hollow bars mark forward-looking points. How the balance works

Positive

• Moderate pointComparable order intake rose 8% in Q3 2026, driven by Diagnosis & Treatment.
• Moderate pointComparable sales increased 3% to group sales of EUR 4.4 billion in Q3 2026.
• Moderate pointAdjusted EBITA margin increased 70 basis points to 13.0% in Q3 2026.
• Moderate pointOperating cash flow increased to EUR 544 million, supported by higher cash earnings and lower working-capital outflows.
• Moderate pointFree cash flow increased to EUR 384 million in Q3 2026.
• Moderate pointNet productivity savings reached EUR 170 million in Q3 and EUR 427 million year-to-date.
• Moderate pointEUR 650 million note issuance raised financing; demand was 2.7 times the offering.
• Moderate pointUS monitoring partnership extended through 2034, covering equipment and services and expanding Capsule platform use.
• Moderate pointOntario Health selected Philips’ imaging archive to modernize province-wide imaging infrastructure.
• Moderate point. Forward-looking: it has not happened yet and may not happen.Latin American healthcare projects include modernizing 50 Venezuelan public hospitals and an expanded partnership with Mexico’s IMSS.

13 minor points

• Minor pointIncome from operations was EUR 165 million in Q3 2026.
• Minor pointConnected Care comparable sales increased 5% in Q3 2026, with growth across all businesses.
• Minor pointConnected Care adjusted EBITA margin increased 190 basis points to 13.3% in Q3 2026.
• Minor pointPersonal Health comparable sales increased 8% in Q3 2026.
• Minor pointPersonal Health adjusted EBITA margin increased 60 basis points to 17.7% in Q3 2026.
• Minor pointDiagnosis & Treatment adjusted EBITA margin increased 50 basis points to 12.3% in Q3 2026.
• Minor point. Forward-looking: it has not happened yet and may not happen.2026-2028 productivity savings target of EUR 1.5 billion remains on track, Philips said.
• Minor point. Forward-looking: it has not happened yet and may not happen.2026 outlook reiterated: comparable sales growth of 3%-4.5%, adjusted EBITA margin of 13.5%-14.0%, free cash flow of EUR 1.5-1.7 billion.
• Minor point. Forward-looking: it has not happened yet and may not happen.EUR 50 million investment is being made in AI, robotics and advanced imaging in the Netherlands.
• Minor point. Forward-looking: it has not happened yet and may not happen.ARPA-H award of up to USD 34 million will support AI-enabled robotic stroke care on Azurion.
• Minor point. Forward-looking: it has not happened yet and may not happen.COMBINE-CT advanced into clinical validation, launching five studies evaluating an integrated care pathway.
• Minor pointAsia Medical Group partnership signed to advance integrated cardiovascular care in China.
• Minor pointAmsterdam Court of Appeal’s Enterprise Chamber denied investor requests for an investigation connected with the Respironics recall.

Negative

• Moderate pointEUR 650 million fixed-rate notes due 2034 add debt obligations.
• Minor pointDiagnosis & Treatment comparable sales were flat; Precision Diagnosis declined amid Ultrasound sales phasing and lower China sales.
• Minor pointCost inflation partly offset adjusted EBITA margin gains in Diagnosis & Treatment and Connected Care.
• Minor pointAdvertising and promotion spending partly offset Personal Health’s adjusted EBITA margin improvement.

News Explained

Philips recorded a EUR 288 million Respironics provision; its 2026 outlook assumes the Q1 2027 DOJ payment but excludes other ongoing proceedings.

Philips Respironics reached an agreement in principle with the US Department of Justice to resolve the previously disclosed criminal and civil investigations, and Philips recorded a EUR 288 million provision in Q3. The agreement still requires final documentation; payment is expected in Q1 2027.

The 2026 outlook assumes payment of the DOJ settlement in Q1 2027 and excludes other ongoing Respironics-related proceedings, including the US State Attorneys General investigation.

For its EUR 650 million notes due 2034, Philips says an amount equivalent to the gross proceeds will finance taxonomy-aligned economic activities described in its European Green Bond Factsheet.

Key Figures

Comparable order intake growth: 8% Comparable sales growth: 3% Adjusted EBITA margin: 13.0%; increased 70 basis points +5 more

Comparable order intake growth

8%

Q3 2026

Comparable sales growth

3%

Q3 2026; Group sales of EUR 4.4 billion

Adjusted EBITA margin

13.0%; increased 70 basis points

Q3 2026

Net cash flows from operating activities

EUR 544 million

Q3 2026

Respironics provision

EUR 288 million

Recorded in Q3 2026 in connection with the DOJ agreement in principle

2026 comparable sales growth outlook

3%-4.5%

Full-year 2026 outlook reiterated

2026 adjusted EBITA margin outlook

13.5%-14.0%

Full-year 2026 outlook reiterated; includes a US tariff refund benefit of approximately 1%

2026 free cash flow outlook

EUR 1.5-1.7 billion

Full-year 2026 outlook reiterated; includes a net US tariff refund benefit of approximately EUR 200 million

Key Terms

adjusted ebita margin, free cash flow, european green bond standard

3 terms

adjusted ebita margin financial

"Adjusted EBITA margin increased 70 basis points to 13.0%"

Adjusted EBITA margin measures a company’s operating profit (earnings before interest, taxes and amortization) after removing one-time or unusual items, expressed as a percentage of sales. It tells investors how much core profit the business generates from each dollar of revenue, making performance easier to compare across periods and peers—think of it like a car’s miles-per-gallon rating that shows true fuel efficiency after ignoring rare detours.

free cash flow financial

"free cash flow of EUR 384 million"

Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.

View in glossary

european green bond standard regulatory

"the new European Green Bond Standard"

A regulatory standard created by the European Union that sets rules for issuing a labelled “European green bond.” It requires that the bond’s proceeds finance activities aligned with the EU Taxonomy for environmentally sustainable economic activities, that issuers disclose how proceeds are used and report environmental impact, and that alignment is checked by an independent verifier; participation is voluntary but gives a harmonized label and mandatory minimum safeguards under the EU framework.

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November 3, 2026


Q3 2026 Group performance

• Comparable order intake increased by 8%, driven by strong Diagnosis & Treatment
• Group sales of EUR 4.4 billion, reflecting 3% comparable sales growth
• Income from operations of EUR 165 million
• Adjusted EBITA margin increased 70 basis points to 13.0%, with expansion across all business segments
• Operating cash flow of EUR 544 million; free cash flow of EUR 384 million
• Respironics reached agreement in principle with the US Department of Justice
• Philips reiterates its full-year 2026 outlook

Roy Jakobs, CEO of Royal Philips:
“We delivered an excellent 8% comparable order intake, led by broad-based order momentum in Diagnosis & Treatment, and 3% comparable sales growth in the third quarter, led by Personal Health and Connected Care. Our innovations and productivity measures drove continued margin expansion across all business segments.

We are executing our plan to accelerate profitable growth, with strong customer demand for our latest AI-enabled innovations, including our new CT platforms Verida and Rembra, our latest ultrasound system Alturion, and our HealthSuite Imaging cloud solution. These innovations demonstrate how our platforms bring together hardware, software, data and AI to create greater value for customers. We look forward to showcasing our next innovations at RSNA later this month.

We continue to make progress in resolving the consequences of the Sleep & Respiratory Care recall. The Respironics agreement in principle with the US Department of Justice marks an important step in this process.

Our year-to-date results, together with our strong order book, give us confidence in delivering our full-year outlook and achieving our medium-term ambitions. As we move forward in collaboration with customers, our hardworking teams around the world are focused on putting quality at the heart of our operations as we deliver better care for more people.”

Group and segment performance

Comparable order intake grew 8%, driven by strong growth in Diagnosis & Treatment. Comparable sales increased by 3%, driven by Personal Health and Connected Care.

Adjusted EBITA margin increased 70 basis points to 13.0%, mainly driven by higher sales, higher gross margin and productivity measures, partly offset by cost inflation. Net cash flows from operating activities increased to EUR 544 million, mainly driven by higher cash earnings and lower working capital outflows. Free cash flow increased to EUR 384 million.

Diagnosis & Treatment comparable sales growth was flat. Growth in Image Guided Therapy was offset by a decline in Precision Diagnosis, mainly due to phasing of Ultrasound sales and lower sales in China as previously communicated at Q2. Adjusted EBITA margin increased 50 basis points to 12.3%, mainly driven by gross margin from innovation and productivity measures, partly offset by cost inflation.

Connected Care comparable sales increased by 5%, driven by growth in all businesses. Adjusted EBITA margin increased 190 basis points to 13.3%, mainly driven by higher sales, higher gross margin, and productivity measures, partly offset by cost inflation.

Personal Health comparable sales increased by 8%. Adjusted EBITA margin increased 60 basis points to 17.7%, mainly driven by higher sales and productivity measures, partly offset by advertising and promotion spend.

Innovation highlights

• Philips is accelerating innovation in image-guided therapy. In the Netherlands, Philips is investing EUR 50 million in AI, robotics and advanced imaging, alongside over EUR 100 million from the Dutch government and a further EUR 150 million in private financing by Invest-NL and institutional investors, including pension funds. In the US, an ARPA-H award of up to USD 34 million will support AI-enabled robotic stroke care on the Azurion platform.
• The Philips-coordinated European COMBINE-CT project advanced into clinical validation, launching five clinical studies to evaluate an integrated care pathway enabled by AI-powered CT and Spectral CT imaging solutions.
• Philips extended its monitoring partnership with one of the largest US health systems through 2034. The national agreement covers equipment and services, expands the use of Philips’ Capsule platform, and supports future technology needs.
• Ontario Health in Canada selected the Philips Enterprise Imaging Vendor Neutral Archive to modernize province-wide imaging infrastructure and connect patient information across care settings. This Vendor Neutral Archive will support the sharing of more than 20 million imaging studies annually across more than 150 hospitals and 50 imaging clinics, helping enable a holistic patient view and more timely access to care.
• Philips is supporting major healthcare programs in Latin America, including the modernization of 50 public hospitals in Venezuela, and an expanded partnership with Mexico’s largest public healthcare institution, IMSS. The projects bring advanced imaging, image-guided therapy and monitoring technologies to more patients, expanding access to diagnostic, cardiac, neurological and stroke care.
• Philips signed a long-term strategic partnership with Asia Medical Group to advance integrated cardiovascular care in China. The partnership will focus on clinical care, training, research and international collaboration, combining Philips’ diagnostic imaging and image-guided therapy capabilities with Asia Medical Group’s cardiovascular expertise.
• Personal Health launched innovations across oral care, beauty and mother and child care. These include the AI-powered Sonicare DiamondClean 9900 Prestige, the first at-home IPL with real-time guidance Lumea 9900 Pro, and Philips Avent’s first fully wearable Natural Care breast pump, bringing more personalized and premium solutions to consumers.

Productivity

Disciplined cost management and productivity initiatives delivered EUR 170 million in net savings in the quarter and EUR 427 million year-to-date. The company remains on track to deliver EUR 1.5 billion in savings under its 2026-2028 productivity program.

Progress on Respironics-related legal proceedings

Philips Respironics reached an agreement in principle with the US Department of Justice (DOJ) to resolve the previously disclosed criminal and civil investigations related to the Respironics recall. As a result, Philips recorded a provision of EUR 288 million in the third quarter of 2026. The settlement is subject to finalization of the relevant documentation; payment is expected in the first quarter of 2027.

Also in the third quarter, the Enterprise Chamber of the Amsterdam Court of Appeal denied requests from certain investors for an investigation into the affairs of Philips in connection with the Respironics recall.

Outlook

Philips reiterates its full-year 2026 outlook:

• Comparable sales growth: 3%-4.5%
• Adjusted EBITA margin: 13.5%-14.0%, including a US tariff refund benefit of approximately 1%
• Free cash flow: EUR 1.5-1.7 billion, including a net US tariff refund benefit of approximately EUR 200 million
  
  

Within the context of an uncertain macro-environment, Philips' 2026 outlook includes currently known tariffs and assumes payment of the US Department of Justice settlement in the first quarter of 2027. The outlook excludes other ongoing Philips Respironics-related proceedings, including the investigation by the US State Attorneys General.


Capital allocation

In the third quarter, Philips issued EUR 650 million fixed rate notes due 2034 (the “Notes”) under its European Medium Term Note program. The Notes are the healthcare industry's first EU Green Bond under the new European Green Bond Standard and were 2.7 times oversubscribed, reflecting strong investor demand. An amount equivalent to the gross proceeds will be used to finance taxonomy-aligned economic activities as referred to in the Philips European Green Bond Factsheet, supporting Philips in delivering on its 2030 Impact Ambitions. See here for more information on Philips' current debt structure.

Further information: conference call, video webcast and website

Roy Jakobs, CEO, and Charlotte Hanneman, CFO, will host a conference call for investors and analysts at 10:00 am CET on November 3, 2026, to discuss the results. A live webcast will be available on the Philips Investor Relations webpage and can be accessed here. A replay and related materials, including additional information on the outlook and forward-looking statements, will be available on the Philips Investor Relations webpage.

Click here to view the release online

For further information, please contact:


Michael Fuchs
Philips Global External Relations
Tel.: +31 6 1486 9261
E-mail: michael.fuchs@philips.com

Dorin Danu
Philips Investor Relations
Tel.: +31 20 59 77055
E-mail: dorin.danu@philips.com


About Royal Philips
Royal Philips (NYSE: PHG, AEX: PHIA) is a leading health technology company focused on improving people’s health and well-being through meaningful innovation. Philips’ patient- and people-centric innovation leverages advanced technology and deep clinical and consumer insights to deliver personal health solutions for consumers and professional health solutions for healthcare providers and their patients in the hospital and the home.

Headquartered in the Netherlands, the company is a leader in image-guided therapy, diagnostic imaging, ultrasound, monitoring, enterprise informatics and personal health. Philips generated 2025 sales of approximately EUR 18 billion and employs approximately 63,900 employees with sales and services in more than 100 countries. News about Philips can be found at www.philips.com/newscenter.

Forward-looking statements and other information

Forward-looking statements

This document and the related oral presentation, including responses to questions following the presentation, contain certain forward-looking statements with respect to the financial condition, results of operations and business of Philips and certain of the plans and objectives of Philips with respect to these items. Examples of forward-looking statements include statements made about our strategy, estimates of sales growth, future Adjusted EBITA*, future restructuring and acquisition-related charges and other costs, future developments in Philips’ organic business and the completion of acquisitions and divestments. Forward looking statements can be identified generally as those containing words such as “anticipates”, “assumes”, “believes”, “estimates”, “expects”, “should”, “will”, “will likely result”, “forecast”, “outlook”, “projects”, “may” or similar expressions. By their nature, these statements involve risk and uncertainty because they relate to future events and circumstances and there are many factors that could cause actual results and developments to differ materially from those expressed or implied by these statements.

These factors include, but are not limited to, macro-economic and geopolitical changes – including the war in Ukraine and ongoing tensions in the Middle East – as well as measures such as enacted and proposed tariffs and trade actions introduced in response to rising global tensions; Philips’ ability to keep pace with the changing health technology environment; Philips’ ability to gain leadership in artificial intelligence and health informatics in response to developments in the health technology industry; integration of acquisitions and their delivery on business plans and value creation expectations; ability to meet expectations with respect to ESG-related matters; securing and maintaining Philips’ intellectual property rights, and unauthorized use of third-party intellectual property rights; failure of products and services to meet quality or security standards, adversely affecting patient safety and customer operations; the resilience of our supply chain; challenges in simplifying our organization and our ways of working; attracting and retaining personnel; breach of cybersecurity; challenges in driving operational excellence and speed in bringing innovations to market; treasury and financing risks; tax risks; reliability of internal controls; compliance with regulations and standards involving quality, product safety, (cyber) security and artificial intelligence; and compliance with business conduct rules and regulations including privacy, existing and upcoming ESG disclosure and due diligence requirements. As a result, Philips’ actual future results may differ materially from the plans, goals and expectations set forth in such forward-looking statements. For a discussion of factors that could cause future results to differ from such forward-looking statements, see also the Further information chapter included in the Annual Report 2025.

Third-party market share data

Statements regarding market share contained in this document, including those regarding Philips’ competitive position, are based on outside sources such as specialized research institutes, as well as industry and dealer panels, in combination with management estimates. Where information is not yet available to Philips, market share statements may also be based on estimates and projections prepared by management and/or based on outside sources of information. Management’s estimates of rankings are based on order intake or sales, depending on the business.

Market Abuse Regulation

This press release contains inside information within the meaning of Article 7(1) of the EU Market Abuse Regulation.

Use of non-IFRS information

In presenting and discussing the Philips Group’s financial position, operating results and cash flows, management uses certain non-IFRS financial measures. These non-IFRS financial measures should not be viewed in isolation as alternatives to the equivalent IFRS measure and should be used in conjunction with the most directly comparable IFRS measures. Non-IFRS financial measures do not have standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. A reconciliation of these non-IFRS measures to the most directly comparable IFRS measures is contained in this document. Further information on non-IFRS measures can be found in the Annual Report 2025.

Presentation

All amounts are in millions of euros unless otherwise stated. Due to rounding, amounts may not add up precisely to totals provided. All reported data is unaudited. Financial reporting is in accordance with the accounting policies as stated in the Annual Report 2025. Certain prior year balances have been reclassified to conform to the current period presentation.


* Non-IFRS financial measure. Refer to the Reconciliation of non-IFRS information

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What were Philips PHG’s main Q3 2026 financial results?

Philips reported EUR 4.4 billion in sales, 3% comparable sales growth and an adjusted EBITA margin of 13.0% for Q3 2026. Comparable order intake grew 8%. Income from operations was EUR 165 million, while operating cash flow and free cash flow were EUR 544 million and EUR 384 million, respectively.

What is Philips PHG’s full-year 2026 outlook?

Philips reiterated its outlook for 3%-4.5% comparable sales growth, a 13.5%-14.0% adjusted EBITA margin and EUR 1.5-1.7 billion in free cash flow. The margin outlook includes a US tariff refund benefit of approximately 1%; the free cash flow outlook includes a net US tariff refund benefit of approximately EUR 200 million.

How will Philips use the proceeds from its EUR 650 million green bond issuance?

An amount equivalent to the gross proceeds will finance taxonomy-aligned economic activities identified in Philips’ European Green Bond Factsheet. The fixed-rate notes mature in 2034 and were issued under its European Medium Term Note program.