GE HealthCare Technologies (GEHC) Jefferies Global Healthcare Conference summary

Post-spin progress and operational independence

• Retired 330 of 500 transition service agreements, advancing operational independence.

• Optimization opportunities expected as remaining TSAs are retired, improving efficiency.

• Emphasis on innovation with a rigorous product planning process and robust R&D funding.

• R&D growth rate in the teens, with Q1 showing around 20% growth.

• Six new ultrasound products launched, expected to drive growth in the second half.

Margin expansion and financial discipline

• Gross margin expanded by 120 basis points in Q1, driven by lean initiatives and pricing.

• EBIT margins targeted to rise from mid-15% to high teens/20% over the next few years.

• Margin drivers include pricing discipline, innovation, and optimization of SG&A and G&A.

• Sustained 1%-2% annual price increases expected, supported by a cultural focus on pricing.

• Cost controls, such as updated travel policies, contribute to incremental savings.

Market outlook and growth drivers

• Addressable market estimated at $87 billion, with favorable demographic and chronic disease trends.

• Imaging and ultrasound growth driven by efficiency and workflow improvements for hospitals.

• PCS segment benefits from post-COVID backlog and robust procedure volumes.

• New and emerging markets in theranostics and imaging agents offer additional growth opportunities.

• U.S. market remains robust; China expected to normalize and resume growth in the second half.