July 27, 2026
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 an ultra-low dose protocol using over 50% less X-ray radiation than current low-dose settings, supported by the first published clinical evidence.
- Philips unveiled the AI-powered Titanion MR, a next-generation ultra-high-gradient 3.0T MRI system, and a first-of-its-kind 4D MR solution for radiation therapy planning, enabling more precise imaging, improved visualization of moving tumors and enhanced clinical decision-making.
- Philips partnered with healthcare providers across Poland to modernize more than 200 hospitals through over 300 healthcare technology projects under the country’s National Recovery and Resilience Plan. The large-scale deployment of imaging, image-guided therapy and patient monitoring solutions expands access to high-quality care nationwide.
- Philips was selected through a tender led by Karolinska University Hospital to support Region Stockholm’s hospital-at-home initiative, delivering more care at home, remote patient monitoring and AI-enabled clinical services for up to 15,000 patients annually.
- Philips signed long-term enterprise imaging partnerships with a premier health system customer in the US and Imperial College Healthcare NHS Trust in the UK. The cloud-based imaging collaborations will connect care teams, streamline workflows and improve access to critical patient information.
- Philips strengthened its Personal Health innovation leadership with recognition from the Good Housekeeping 2026 Beauty Awards for the Lumea IPL 9000 and Sonicare 6400, and launched the new Philips S800 Compact Shaver in China.
Productivity
Disciplined cost management and productivity initiatives delivered EUR 132 million in savings in the quarter. Philips is on track to deliver EUR 1.5 billion in savings under its 2026-2028 productivity program.
Outlook
Philips reiterates its full-year 2026 outlook, updated to reflect the US tariff refund benefit:
- Comparable sales growth: 3%-4.5%
- Adjusted EBITA margin: 13.5%-14.0%, including a US tariff refund benefit of approximately 1%, compared to 12.5%-13.0% previously
- Free cash flow: EUR 1.5-1.7 billion, updated to reflect the US tariff refund, compared to EUR 1.3-1.5 billion previously
Within the context of an uncertain macro-environment, Philips' 2026 outlook includes currently known tariffs. It excludes ongoing Philips Respironics-related proceedings, including the investigation by the US Department of Justice and the State Attorneys General.
Capital allocation
Philips completed its dividend distribution for 2025 in the second quarter of 2026. As approved by the Annual General Meeting of Shareholders on May 8, 2026, a dividend of EUR 0.85 per common share was paid in cash or shares at the election of the shareholder, with 43.8% paid in cash.
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 08:00 am CET on July 28, 2026, to discuss the results. A live webcast of the conference call will be available on the Philips Investor Relations webpage and can be accessed here. A replay and related materials, which include additional information, including forward-looking statements and further information on our outlook, will be available on the Philips Investor Relations webpage.
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 63,700 employees with sales and services in more than 100 countries. News about Philips can be found at www.philips.com/newscenter.