Carl Zeiss Meditec Stock: Q1 Profits Slump Despite Revenue Growth

Carl Zeiss Meditec, the medical technology company based in Jena, reported mixed first-quarter results for fiscal year 2024/25, with revenues exceeding market expectations but profitability showing significant weakness. The company achieved a 3.2% revenue increase to €490.5 million, surpassing analyst forecasts of €480 million. However, this growth was primarily driven by the DORC integration, while organic growth declined by 7.3%. Operational performance deteriorated notably, with EBITA dropping from €46 million to €35.2 million, and the EBITA margin falling from 9.7% to 7.2%. Earnings per share more than halved to €0.18, down from €0.42 in the previous year. Regional performance varied significantly, with EMEA and Americas posting strong growth of 11.2% and 19.3% respectively, while the Asia-Pacific region declined by 11.5%, mainly due to weakness in the Chinese market.

Market Response and Outlook

The stock market reacted negatively to these results, with shares dropping more than 5% to €55.65. Despite the challenging quarter, management maintains its full-year guidance, projecting moderate revenue growth while acknowledging ongoing challenges from the global economic environment and cautious investment climate. The company plans to leverage new product launches throughout the year to generate additional growth potential, while implementing cost containment measures to stabilize EBITA and margins.