By Dania Nadeem
(Reuters) - Abbott Laboratories (NYSE:ABT) on Tuesday cut its full-year 2021 profit forecast as it expects a sharp decline in revenue from its COVID-19 tests as more Americans get vaccinated, sending the medical device maker's shares down more than 6%.
"This has been driven by several factors, including significant reductions in (COVID-19) cases in the U.S. and other major developed countries, accelerated roll-out of vaccines globally and, most recently, U.S. health authority guidance on testing for fully vaccinated individuals," the company said.
The new guidance from the Centers for Disease Control and Prevention issued in May allows people who have been vaccinated to travel in the U.S. without getting tested before or after travel. (https://
Abbott got more than $3 billion from sales of its COVID-19 tests last year, but analysts have cautioned that demand is likely to fall this year.
Rivals Quest Diagnostics (NYSE:DGX) Inc and Becton, Dickinson and Co said over the last couple of months that demand for COVID-19 tests has started to decelerate and expect lower sales in the coming quarters.
Abbott, which generated half of its total COVID-19 testing sales in the first quarter from overseas markets, said it expects a similar drop in testing demand in international markets.
"We'll start to see that (drop in testing demand) first with the developed markets as the vaccination rates in those increase and accelerate," Chief Executive Officer Robert Ford said.
The company forecast 2021 sales related to COVID-19 testing between $4.0 billion and $4.5 billion, compared with its prior outlook of $6.5 billion to $7.0 billion.
The company now expects full-year adjusted profit from continuing operations of $4.30 to $4.50 per share, compared with its prior forecast at least $5 per share in January. Analysts expect the company to earn $5.04 per share, according to Refinitiv IBES data.