Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
BAX (Baxter International) reported a deeply challenging FY2025, with revenue growing 5.7% to $11.24B but gross margin collapsing 740 basis points to 30.1%, driving an operating loss of $308M and a net loss of $957M as cost pressures overwhelmed top-line gains.
Revenue
$11.24B
+5.72% YoY
EPS (Diluted)
-$1.87
-47.24% YoY
Gross Margin
30.1%
-7.4 pts YoY
Operating Income
-$308M
-2300.00% YoY
Source: SEC XBRL
Baxter International (BAX) reported FY2025 revenue of $11.24B, up 5.7% year over year. Operating margin was -2.7%, against 0.1% a year earlier. Operating cash flow was $845M, down 17.1% year over year.
Last 4 quarters: 3 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026 | 0.56 | 0.37 | Beat +51.5% |
| Mar 2026 | 0.36 | 0.31 | Beat +15.9% |
| Dec 2025This filing | 0.44 | 0.54 | Miss -18.7% |
| Sep 2025 | 0.69 | 0.60 | Beat +14.2% |
Reported EPS of $0.44 versus the $0.54 analyst consensus — a -18.7% miss for Dec 2025.
Compiled by AI from this SEC filing
Revenue increased 5.7% YoY to $11.24B, but Cost of Revenue surged 18.2% to $7.87B, causing Gross Profit to fall 15.2% to $3.38B. This dramatic divergence between revenue growth and cost growth signals significant margin compression that management must address.
Source: 10-K Income Statement
Operating Income swung from a slim $14M profit in the prior year to a loss of $308M in FY2025, a deterioration of over 2,300%. Despite SG&A declining 2.6% to $2.89B and R&D falling 12.2% to $518M, cost cuts were insufficient to offset the gross profit decline.
Source: 10-K Income Statement
Total Assets declined 22.2% to $20.06B and Long-Term Debt fell 28.4% to $9.44B, while Financing Cash Flow showed a large outflow of $4.22B. Investing Cash Flow turned sharply positive at $2.84B (vs. -$626M prior year), suggesting significant asset disposals or divestitures funding debt repayment.
Source: 10-K Balance Sheet & Cash Flow Statement
Current Ratio stands at a healthy 2.31x, with Current Assets of $6.87B well exceeding Current Liabilities of $2.97B (which fell 54.4% YoY). Cash & Equivalents grew 11.5% to $1.97B, providing near-term liquidity buffer despite ongoing net losses.
Source: 10-K Balance Sheet
Operating Cash Flow declined 17.1% YoY to $845M, still positive due to non-cash D&A of $981M offsetting the net loss of $957M. Free Cash Flow generation remains constrained as the business works through its profitability challenges.
Source: 10-K Cash Flow Statement
Compiled by AI from this SEC filing · 3 high, 2 medium, 0 low
Gross margin collapsed from 37.5% to 30.1% YoY, a 740 basis point decline, as Cost of Revenue grew at more than three times the rate of revenue (18.2% vs. 5.7%). If cost pressures persist — whether from supply chain, manufacturing, or input costs — the company risks sustained operating losses and further erosion of shareholder value.
Source: 10-K Income Statement
Despite significant debt reduction, Long-Term Debt remains elevated at $9.44B against Stockholders' Equity of $6.13B, yielding a Debt-to-Equity ratio of 2.28x. With the company generating net losses of $957M, servicing this debt load while investing in the business presents a meaningful financial risk.
Source: 10-K Balance Sheet
BAX reported a net loss of $957M in FY2025 (vs. -$649M prior year), with ROE of -15.6% and ROA of -4.8%. Continued losses erode the equity base ($6.13B, down 12% YoY) and may limit the company's ability to invest in growth or attract capital on favorable terms.
Source: 10-K Income Statement & Balance Sheet
The dramatic swing in Investing Cash Flow to +$2.84B (from -$626M) and the sharp decline in Total Assets (-22.2%) strongly suggest significant asset sales or divestitures. While this supports deleveraging, it may reduce the company's revenue-generating capacity and competitive positioning over time.
Source: 10-K Cash Flow Statement & Balance Sheet
R&D spending fell 12.2% to $518M in FY2025, which may reflect cost-cutting measures but could impair long-term product innovation and pipeline development in the competitive medical products industry. Sustained underinvestment in R&D risks weakening BAX's competitive moat.
Source: 10-K Income Statement
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 11.24 $B | 10.64 $B | +5.72% |
Cost of Revenue $B | 7.87 $B | 6.65 $B | +18.24% |
Gross Profit $B | 3.38 $B | 3.98 $B | -15.19% |
Operating Income $M | -308.00 $M | 14.00 $M | -2300.00% |
Net Income $M | -957.00 $M | -649.00 $M | -47.46% |
EPS (Basic) $ | -1.87 $ | -1.27 $ | -47.24% |
EPS (Diluted) $ | -1.87 $ | -1.27 $ | -47.24% |
R&D Expense $M | 518.00 $M | 590.00 $M | -12.20% |
SG&A Expense $B | 2.89 $B | 2.97 $B | -2.60% |
Answers draw on this SEC filing and the data on this page
In Q2 FY2026, Baxter International reported a 5.3% YoY revenue increase to $2.96B and a 38.5% surge in net income to $126M, supported by segment realignments and $75M in tariff refund credits.
BAX posted Q1 FY2026 revenue of $2.70B (+2.9% YoY) with improving operating income, but swung to a net loss of -$15M versus net income of $126M a year ago, driven by below-the-line charges that masked otherwise steady operational progress.
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