Philips adjusts expectations following impact of EU-US deal
Philips reports a 6% increase in orders, with operating profit and free cash flow also rising sharply in Q2.
Published on July 29, 2025
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Philips reports a 6% increase in orders, while operating profit and free cash flow also rise strongly. The company is raising its expectations for profit margin and free cash flow for the full year 2025, as announced today with the publication of its second quarter results. The CEO emphasizes that Philips is leveraging innovation and improved fundamentals to deliver profitable growth and better care for more people.
Order growth and revenue
Philips' order intake grew by 6% in the second quarter of 2025, a sign of strong demand for the company's products and services. Total revenue for the group amounted to €4.3 billion. This growth is attributable to innovations and an improved market position. Roy Jakobs, CEO of Royal Philips, emphasizes that the focus is on profitable growth and delivering better care. The recently launched AI-driven innovations support this growth. Philips' revenue in the past quarter was comparable to that in the same period last year, but profit and margin did increase.
Impact of trade agreements
Philips expects lower costs as a result of the new trade agreements between the EU and the US. Initially, it was thought that Philips would lose more than €250 million due to the US tariffs. This has now been adjusted to €150 to 200 million. The deal between the EU and the US has a positive impact on Philips, as do the new trade agreements between China and the US. Philips also manufactures devices in China for sale in the US. Until May 14, there was a 145% import tax on products from China, but this was reduced to 30% for the next 90 days thanks to an interim agreement. Philips is raising its profit forecast for the coming year to around 11.5%.
Cooperation with Indonesia
Philips has signed a long-term cooperation agreement with the Indonesian Ministry of Health.
The goal is to provide nationwide coverage for Philips' advanced Azurion image-guided therapy systems. This will expand access to heart, stroke, and cancer care for more than 280 million people in all 38 provinces of Indonesia. This collaboration is an example of Philips' commitment to improving healthcare worldwide. The agreement includes the implementation of Philips' advanced technologies to improve the diagnosis and treatment of various diseases, contributing to public health in Indonesia. The collaboration with Indonesia is a strategic step for Philips to strengthen its position in emerging markets and contribute to better healthcare outcomes.
