GE醫療 2026 年第三季財報電話會議：利潤率擴張與上調財測指引

重點摘要

• GE醫療公佈 2026 年第三季營收達 55 億美元，有機成長 6.2%，各事業群均實現成長。
• 調整後息稅前利潤率 (EBIT margin) 擴增 180 個基點至 16.6%，調整後每股盈餘 (EPS) 則成長 25.1% 至 1.34 美元。
• 有機訂單成長 4%，接單出貨比 (book-to-bill) 為 1.03 倍，在手訂單達 237 億美元，年增 25 億美元或 12%。
• 自由現金流年增 3.1 億美元至 7.93 億美元，受惠於營運獲利能力、應收帳款回收時程以及淨關稅影響減少。
• 藥用診斷事業群以 13.8% 的有機營收成長領跑各部門。患者照護解決方案事業群大幅改善，有機營收成長 8.8%，EBIT 利潤率擴增 480 個基點。
• 管理層上調 2026 全年展望，有機營收成長率約為 4%，調整後 EPS 為 4.95 至 5.05 美元，自由現金流超過 16 億美元。

核心財務數據

利潤率擴增反映出出貨量增加、價格提升、成本減緩措施以及關稅費用下降。這些優勢被記憶體晶片通膨與石油相關供應鏈成本上升部分抵銷。

業務與營運表現

先進影像解決方案

有機營收成長 4.5%，主要由電腦斷層掃描 (CT)、心血管介入解決方案與外科創新產品所帶動。由於出貨量增加、關稅費用降低及價格改善，該部門 EBIT 利潤率擴增 130 個基點，但部分被通膨抵銷。

管理層亦指出對具備 AI 功能的 CT 系統、磁振造影 (MR) 升級與心血管超音波的需求增加。GE醫療的 Photo Nova Spectrum 光子計數 CT 平台已獲得歐盟 CE 認證，而 Starguide GX 則在等待美國 FDA 批准。

藥用診斷事業群

藥用診斷事業群實現 13.8% 的有機營收成長，受惠於顯影劑與放射性藥品。部門 EBIT 利潤率上升 50 個基點至 29.9%，主因出貨量與價格增幅超過對新產品與創新管道的計畫性投資。

管理層表示該業務已連續五個季度實現至少高個位數的成長。目前產品組合中約有四分之三為顯影劑，可帶來與檢查量相關的常態性營收。放射性藥品仍是該公司成長最快的市場之一。

GE醫療計劃收購 Sofie Biosciences，以擴展其美國放射性藥品最後一哩路供應網絡並強化其研發管道。管理層預期 Sofie 將為公司年化營收貢獻約 1%。在併購後的第一個完整年份，預計該被收購業務將實現雙位數低段的營收成長，並有助於提升調整後 EBIT 利潤率與調整後 EPS。

患者照護解決方案事業群

患者照護解決方案事業群錄得 8.8% 的有機營收成長，反映出監測解決方案與母嬰照護產品的出貨履行情況有所改善。部門 EBIT 利潤率擴增 480 個基點，主要歸因於出貨量增加與成本效益提升。

管理層將此改善歸功於精細化的日常管理、更佳的供應商執行力，以及在 Heartbeat 營運系統下的更強工廠表現。公司預期營運將進一步改善，儘管第四季的基期比較將受到 2025 年第四季產品暫停出貨解除所帶來的約 4,500 萬美元營收挹注所影響。

在 Jeanette Banks 離職後，Neil Sandy 將接任患者照護解決方案事業群的執行長。管理層表示，領導層轉型不會影響對該業務策略選項的評估。

中國市場與供應鏈

GE醫療在本季於中國市場實現 7% 成長，但管理層指出大部分增幅來自匯率效應。底層表現仍屬正面，公司觀察到市場活動與招標執行有所改善，但也提醒仍需做更多工作以恢復持續性成長。

該公司亦與科技供應商簽訂多年期協議，以確保記憶體晶片供應。管理層預期資料中心與 AI 基礎設施的強勁需求將影響組件供應長達數年，因此取得供應與價格管理成為重要優先事項。

管理層財務預測

GE醫療上調了 2026 全年的多項目標：

管理層指出，推算的第四季營收成長 3%-4% 主要反映了患者照護解決方案事業群高基期的比較挑戰，而非更廣泛的市場放緩。先進影像解決方案與藥用診斷事業群預計將驅動第四季成長。

該公司並未提供正式的 2027 年指引。然而管理層表示，目前的訂單管道、在手訂單轉換以及高毛利新產品支撐了邁入 2027 年的信心，同時強調關稅與其他總體經濟變數仍具不確定性。

風險與關注焦點

• 記憶體晶片通膨與油價上漲增加了第三季的供應鏈成本。
• 關稅稅率仍具不確定性，特別是 232 條款下的潛在變動。管理層正在針對可能的稅率上升進行規劃，並採取定價、採購與製造方面的行動以減緩影響。
• 第三季包含約 400 萬美元與 2026 年相關的 IEEPA 關稅退款。公司調整扣除了約 900 萬美元與 2025 年相關的退款。
• 患者照護解決方案事業群因前一年產品暫停出貨解除的高基期，面臨嚴峻的第四季比較挑戰。
• 管理層指出單季訂單可能具有波動性，因為大型合約金額可能超過 1 億美元，且可能在不同申報期間之間推移。
• 中國市場出現改善跡象，但管理層尚未宣告全面復甦。
• 顯影劑市場已進入學名化階段，可能面臨額外競爭。管理層表示目前產業產能利用率極高，並對 GE醫療的市場地位充滿信心。

分析師問答重點

資本支出與需求：管理層表示，醫療影像仍是客戶資本支出的優先事項。尚未觀察到掃描數據或顯影劑使用量的直接放緩，並形容設備商機管道強勁。許多影像項目的安裝交期為 12 至 24 個月。

訂單與在手訂單：1.03 倍的接單出貨比部分歸因於大型合約正常的時程波動。管理層表示第四季訂單狀況看起來比第三季更為強勁，並強調在手訂單仍處於歷史新高水準。

2027 年利潤率佈局：管理層預期關稅與通膨仍將持續，但相信價格策略、供應鏈行動、產品組合以及 Heartbeat 驅動的生產力提升能減緩壓力。正式的 2027 年指引預計將於 2 月發布。

定價策略：GE醫療正選擇性地提高價格，並重點推廣能提供可量化生產力或臨床效益的產品。管理層指出，全公司正向的定價成果普遍落在 1%-2% 的範圍內。

單季營收可見度：管理層表示，第四季絕大部分的營收需求已有訂單及經過驗證的客戶安裝時程所支持。在手訂單的交付日期已延伸至 2027 年與 2028 年。

Sofie Biosciences 收購案：管理層將此收購案定位為超越單一放射性藥品之支持。掌控部分製造與分銷網路預期將改善供應鏈控制，並擴大 GE醫療在診斷、治療及診療合一 (theranostics) 領域的參與度。

法說會逐字稿全文

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完整財報電話會議逐字稿

管理層陳述

Operator

Good day, and thank you for standing by. Welcome to the GE Healthcare Third Quarter 2026 Earnings Conference Call. [Operator Instructions] please be advised today's conference is being recorded. I would now like to hand the conference over to your speaker today, Carolynne Borders, Head of Relations. Please go ahead.

Carolynne Borders

Thanks, operator. Good morning, and welcome to GE Healthcare's Third Quarter 2026 Earnings Call. I'm joined by our President and CEO, Peter Arduini, CFO, Bill Grogan; and Controller and Chief Accounting Officer, George Nukem. Our conference call remarks will include both GAAP and non-GAAP financial results. Reconciliations between GAAP and non-GAAP measures can be found in today's press release and in the presentation slides available on our website. During this call, we'll make forward-looking statements about our performance. These statements are based on how we see things today. As described in our SEC filings, actual results may differ materially due to risks and uncertainties.

With that, I'll hand the call over to Peter.

Peter Arduini

Thanks, Carolynne. Good morning, and thank you for joining us today. Before I review highlights from the quarter, I want to take a moment to welcome Bill. He brings tremendous experience and a strong track record, and I'm looking forward to partnering with him as we execute against our strategy and deliver on our priorities. Looking at our third quarter results on Slide 3. We delivered strong top line growth and margin expansion across all segments. Broad-based demand in advanced imaging solutions and pharmaceutical diagnostics supported healthy orders, book-to-bill and backlog.

Heartbeat is strengthening how we run the company and helping our teams deliver on commercial and operational simplification. Great example of performance driven by Heartbeat this quarter is patient care solutions. The team identified root causes of prior supply challenges and implemented standard work and early management to drive ongoing improvements. This drove backlog conversion and stronger operational performance.

Taken together, momentum in our business has enabled us to raise our full year 2026 guidance, which Bill will cover later in the call. Turning to Slide 4. Let's look at how we're advancing our growth strategy. We reached key regulatory milestones in the quarter on 2 imaging platforms with market differentiating features. We received CE marking for Photo Nova Spectrum, our Photon Counting CT system and Starguide GX, our spec CT system is pending FDA clearance. This broadens our ability to commercialize in more markets.

We also expanded our ultrasound platforms in cardiovascular, women's health and general imaging. With the launch of several new products to meet the growing demand for noninvasive imaging. We continue to see general imaging ultrasound as an attractive market where we're investing for the long term. With growing demand, staffing constraints and more distributed care, Ultrasounds versatility across a broad range of exams is increasingly valuable. PDx delivered another excellent quarter with growth in contrast media and radiopharmaceuticals, including proprietary tracers aligned to disease states.

This was supported by momentum in precision and growing demand for targeted diagnostics in oncology, cardiology, and neuro. Earlier this month, we announced our plans to acquire Sofie Biosciences. Upon close, this will establish a final mile footprint of U.S. radiopharmaceutical supply, it will also strengthen our pipeline through FAPI74, a Phase III PET tracer with the potential to help diagnose and treat a range of cancers and other diseases.

Part B is driving improvement in execution across the company, keeping our teams focused on SQDCI, safety, quality, delivery, cost and innovation in that order and services, standardized digital support is helping our field engineers resolve more issues on the first visit. We expect this to save approximately 10,000 hours of field time across CT/MR and X-ray in the U.S. and get customers back up faster. In AIS, stronger standard work and operating rigor around variable cost productivity delivered incremental cost reductions, helping partially offset inflation.

We recently entered multiyear strategic agreements with several leading technology partners to secure memory chips to strengthen the resiliency and predictability of our supply chain amid growing cross-industry demand for advanced computing components. We continue to pursue agreements to position us in the future. Lastly, before I hand the call over to Bill, Today, we announced that Jeanette Banks, who leads our PCS business will be leaving a CEO role at a noncompetitive publicly company. We thank her for her contributions and wish her the best.

Leveraging our strong succession pipeline, I'm excited to announce that Neil Sandy, currently Head of Product Strategy and Management for PCS will become the CEO of the business. I have tremendous confidence in Neil's capabilities given his current role and more than 30 years of experience in the industry. We remain focused on building on the progress the team achieved in the quarter and we also are evaluating strategic options for this business.

With that, Bill will walk through the financials and guide. Bill?

William Grogan

Thanks, Pete. Let me start by saying how excited I am to have joined GE Healthcare. I've been impressed by the talent and commitment of the team and I look forward to helping to build on the existing foundation as we execute on the significant opportunities ahead. Now let's turn to our third quarter financial results on Slide 5. We're pleased with our strong performance on both the top and bottom line and with growth ahead of expectations. Revenue of $5.5 billion increased 6.2% organically, with growth across all segments.

On a reported basis, we had strong performance in both product and service revenues at 6.7% and 8.1% growth, respectively. Organic orders grew 4% as a reminder, orders growth in the third quarter of last year was 5.7%, so we're growing mid-single digits on a strong baseline. On a trailing 12-month basis, organic orders growth was 4.6%. Book-to-bill was 1.03x, and we exited the quarter with a backlog of $23.7 billion, up $2.5 billion or 12% year-over-year.

We made progress on margin expansion this quarter, delivering adjusted EBIT margin of 16.6%, up 180 basis points. I'll discuss the operational drivers in more detail on the next slide. With our strong execution in the quarter, we delivered adjusted EPS of $1.34, up 25.1%. Lastly, our free cash flow was $793 million, up $310 million versus the prior year. On Slide 6, we'll look at the drivers of margin expansion in the quarter. Our commercial execution helps us grow profitably as volume provided a healthy tailwind to margin.

Additionally, the price and cost mitigation actions we've been taking across the business are starting to deliver a more meaningful benefit. Tariff expense was also lower than the prior year. Margin was negatively impacted by inflationary costs for memory chips as well as the impact of higher oil prices across our supply chain. As we think about our margin expansion framework, it is built around 2 key areas underpinned by Heartbeat, commercial execution and operational simplification. Starting with commercial execution.

Our focus is on driving high-quality, profitable growth. This includes capturing strategic pricing opportunities, standardizing our product launch playbook and bringing new products to market at higher gross margins. As I've been coming up to speed on our business, a strong example is our Vivid cardiovascular platform, where differentiated AI-enabled capabilities supported premium pricing, while a simplified design reduced manufacturing costs. On the operational side, we are simplifying how we run the business and reducing complexity across the organization.

This includes advancing product platforming, optimizing our structural cost base, streamlining internal processes to eliminate rework and the VCP examples Pete mentioned earlier together these actions are helping us improving efficiency and create a more scalable operating model, while supporting margin expansion. Let's move to our consolidated segment performance on Slide 7. Starting with Advanced Imaging Solutions. Organic revenue grew 4.5%, driven by strength in CT, cardiovascular Interventional Solutions and Surgical Innovations.

EBIT margin expanded 130 basis points year-over-year, driven by volume, reduced tariff expense and price. This was partially offset by inflation. Demand for our cardiology solutions also increased, which was reflected in demand for our AI-enabled CT solutions, MR upgrades and cardiovascular ultrasound. Moving to Pharmaceutical Diagnostics. We delivered robust organic revenue growth of 13.8% with contributions from contrast media and radiopharmaceutical products. Segment EBIT margin expanded 50 basis points to 29.9%, driven by volume and price, partially offset by planned investments in new products and our innovation pipeline.

As mentioned, we also announced the planned acquisition of Sofie Biosciences. Sophie's revenue will add approximately 1% of total company revenue on an annualized basis. In the full year of ownership, revenue is expected to grow in low double digits with accretive adjusted EBIT margin and adjusted EPS. Patient Care Solutions delivered significant sequential improvement in the quarter and year-over-year organic revenue grew 8.8% driven by improved operational performance, including better product fulfillment and monitoring solutions and maternal infant care.

Backlog continues to grow alongside revenue. Segment EBIT margin expanded 480 basis points year-over-year, primarily driven by higher volume and cost productivity. Third quarter performance was better than expected with strong product fulfillment driven by daily management and improved supplier and factory execution. We expect this to benefit us in the future.

However, keep in mind that the fourth quarter of 2025 had an approximate $45 million revenue benefit from the release of a product hold. Turning to cash performance on Slide 8. We delivered free cash flow of $793 million in the third quarter, the year-over-year increase was supported by a reduction in net tariff impact, including lower payments as well as refunds in the quarter. Additionally, operational profitability and timing of collections helped drive year-over-year improvements. We also increased our cash dividend by 14%, further enhancing returns to shareholders.

Now let's turn to our outlook on Slide 9. Our continued execution gives us increased confidence in our outlook, as a result, we are raising several of our full year 2026 metrics. We now expect organic revenue growth of approximately 4%, adjusted EBIT margin in the range of 15.5% to 15.7%, adjusted EPS in the range of $4.95 to $5.05 per share and free cash flow in excess of $1.6 billion. We expect our adjusted effective tax rate to be in the range of 20% to 21% for the full year and foreign exchange tailwind to revenue of approximately 75 basis points.

With that, I'll turn the call back to Pete.

Peter Arduini

Thanks, Bill. I'd like to spend a few minutes highlighting PDx a great example of how we're executing our D3 strategy, which brings together smart devices and drugs with a disease state-focused and AI, enabling more precision care. PDx has delivered at least high single digits growth for 5 straight quarters. We're investing in strengthening our supply chain and manufacturing capabilities and expand where we can create value. As populations age and chronic disease rises, clinicians need imaging that answers sharper questions, which treatment for which patient and when Managing the diseases often requires imaging at several points along the patient journey from diagnosis to treatment to monitoring.

Our agents are used in many of those imaging scans because each scan uses a dose PDx revenue is recurrent and grows with patient volume. About 3/4 of the portfolio today is contrast media, where volumes grow with global procedure demand. We're also investing in what comes next with our MR manganese-based contrast agent. It has the potential to address a nearly $1.2 billion market we're making good progress on our combined Phase II and Phase III international trial. The remaining balance of revenue contribution is from radiopharmaceuticals, one of our fastest-growing markets. Here, PDx drugs and our AI-enabled devices complement each other.

Each new agent helps clinicians detect and monitor disease, which drives demand for imaging and our pet systems. We're seeing that in our molecular imaging business, which grew strongly again this quarter. That combination is a differentiator for us as the only company with proprietary molecules in a large imaging portfolio. We continue to see increased demand for our radiopharmaceutical portfolio, including Visma and Sarana and we're also seeing strong performance from established products like DaTscan, our spec imaging agent for patients with suspected Parkinson's disease types.

Meanwhile, Forcado is on track we delivered approximately 680 doses for the week ending October 23, and we're seeing growing adoption across a broad-based range of customer types. Those include the existing Cardiac PET CT programs that have been partially or fully converted to Picado as well as others that are converting from spec to pet. This adoption reflects Vicado's diagnostic capabilities, longer half-life and flexible infrastructure. To help expand the final mile distribution of these radiopharmaceuticals, we plan to acquire Sofie Biosciences.

Pairing Soffe's network with our manufacturing scale, will expand access and strengthen supply reliability, enabling us to directly manage a portion of our radiopharmaceutical manufacturer. It will also position us to advance the next generation of precision care, including PSMA, app and theranostics. Were the same molecules that diagnose the disease help guide targeted treatment. Simply put, PDx pay resilient recurring revenue today with a pipeline and footprint to extend that growth.

In summary, we're pleased with third quarter results and importantly, the strong contributions from our team. Heartbeat is helping us strengthen commercial execution and operational performance. Our focus on standard work and daily management has been critical in driving more consistent performance. We continue to advance our new wave of innovation, achieving key regulatory milestones in the quarter, and we're executing on our priorities and our performance year-to-date gives us confidence in delivering on our commitments for patients, customers and shareholders.

With that, we'll open up the call to questions.

Carolynne Borders

Thank you, Peter. I'd like to ask participants to please limit yourself to 1 question and 1 follow-up. Operator, can you please open the line?

Operator

[Operator Instructions] Our first question comes from the line of Travis Steed with Bank of America Securities.

分析師問答

Travis Steed

Bill, looking forward to working with you, congrats on the new job at GE. I'd start with the first question. I start with the first question on the CapEx environment. Just a lot of questions on 340B and the macro and kind of what you're seeing on the CapEx environment. And I did have 1 follow-up.

William Grogan

Travis, thanks. Look, I mean, as you saw and you heard our comments, we're pleased with the quarter results, the strong execution. I think you're starting to see some of the product differentiation coming through. But relative to the capital budget market, particular technologies like what we do in imaging from all of our survey data and discussion with ranks at the top of the list. I think you know we do a survey of kind of same-store sales with customers -- and fundamentally, I would say the energy and positive focus on that survey stayed the same.

I mean it positions us well, I think, as we go into Q4 into next year. I know there's been some commentary around procedures pull back here and there in different areas. We haven't seen that directly either in scan data or actually contrast use data at this point and indicators that would demonstrate slowdown or changes like that have to be multiple, multiple quarters. So I think we start seeing it coming through in our equipment. One of the things about the imaging world is or other capital equipment. A lot of these are programs that are planned.

You make a decision now for an installation that might be 12, 18, 24 months out. And I would say our funnel is as strong as it's ever been at this time. So we feel good about the trajectory as we come at the end of the year and as that converts into the beginning of '27.

Travis Steed

And the follow-up question is more on backlog this quarter was down a little bit, book-to-bill, 1.03, it was the lowest since first quarter '24. Is that just lumpiness you're seeing quarter-to-quarter volatility? And I guess part of it is probably fulfilling last quarter's strong orders as well.

Peter Arduini

Yes. No. I think that's it, Travis. I mean I think, as you know, and many of the follows from an order standpoint, with big deals that we do that can be $100 million plus, you have some land in a given quarter, they slide out by a week. It obviously creates a significant lumpiness. But we feel quite good about the orders. Bill had mentioned, coming off a strong year last year, both PDx and AIS did well. I would comment that our pipeline of opportunities remain strong, is up which is an underpinning of the resiliency that we see out in the marketplace.

So all of that, we feel quite good about it. I think from a standpoint of where we are with our capital equipment cycles and stuff, things are looking pretty good on the conversion. As I look out into Q4, our orders book looks a little bit better than we actually had in Q3.

Operator

Our next question comes from the line of Vijay Kumar with Evercore ISI.

Vijay Kumar

Bill, congrats on role. I guess my first question, Pete, is on Facade. Your you gave the weekly dose assumption and the revenue run rate. How are you thinking about the PAT to 500 run rate exiting '28 how does Sofie help? I think it makes the last mile connectivity. But how should we think about the ramp when you think Sofia's part of GE healthcare -- does it improve your visibility to that $0.5 billion exit rate in fiscal '28?

Peter Arduini

Yes, Vijay, look, I think with Picato, short answer is we feel very good about the $0.5 billion exiting 2028. kind of -- as I mentioned on the call, we're progressing as we expected. Feel good about the momentum and the weekly build. I think we're seeing broad-based growth and interest I think 1 of the interesting areas is, as I think we know this started out as much as with heavy interest in pet users that were already in cardiovascular, and that continues. We're starting to also see now the broadening of spec users that are saying it's time to kind of start considering moving into the pet world.

And that's important because if you remember, the long-term opportunity is over 80% spec that. So both of those are growing. I think our funnels at this point in time are up significantly, which is what we look at on a forward metric about opportunities and what our conversion rate would be -- one of the other key mix I mentioned last quarter was the amount of customers that we converted. We converted about the same percentage of customers this quarter as we did last -- and again, those will begin to build. It's a 60-day cycle of only a case or 2 until they get reimbursement, and then that can ramp up into double digits.

So things look good. I think, again, the positivity that we see from customers you hear from customers on all the attributes discussed, image quality, dose management with larger patients, all those things are still playing out. And then just notably, I think I mentioned in the comments, the larger portfolio in radiopharma, meaning breast cancer imaging, imaging relative to other cancers and stuff continues to grow. And that's important because it also means that department within an institution gets more focused. So there tends to be more dollars allocated in that area as well, which we're beginning to see.

Vijay Kumar

And maybe my second 1 on China. In the region got back to growth. Has this -- has China bottomed up? Is it back to growth -- what is the normalized outlook, Pete? And there are some questions coming on maybe imaging BP in China, if there is one, could you elaborate on what the impact is?

Peter Arduini

Yes, BJ, I don't know if I would give a full prediction as everything completely changed, but I can give you the play-by-play as we see it. And obviously, our quarter -- we've seen quarterly improvement within China. I think you'll see we had 7% in the growth in the quarter, albeit the majority of that was still driven by FX. It was positive within the quarter. And the market is definitely recovering. We're seeing activity improvement, which transit into consistency and tenders that are planned, tenders that are executed. We are actually seeing more VBP.

But I would say we've been changing our tactics, what configurations we offer how we go to market that way, how we think about educating and interacting with a province or a smaller community and so I think our team there led by Will has done a really nice job of evolving the channel. That being said, I think there's still lots of wood to chop, so to speak, here on advancing growth within China. But we're pleased with the results that the team put up here for the quarter.

Operator

Our next question comes from the line of Matt Taylor with Jefferies.

Matthew Taylor

This is Matthew on for Matt Taylor. I wanted to ask about these multiyear agreements you have with technology partners and particularly on securing our memory trip supply. Could you possibly expand on how this helps you manage your costs going forward?

Peter Arduini

Yes, Matthew, I think we mentioned on the call that we've recently aligned at, I think, look, pull the lens big picture, -- it's no secret that the growth of data centers in AI has a big vortex effect on certain components around the industry. We think that's going to most likely exist for multiple years as this ramp-up goes. So we've taken an ecosystem approach to take a look at all of those things that could affect our business positively or negatively and reached out to the suppliers in the industry with what we believe is adequate lead time to secure first supply and obviously manage pricing the best that we can.

At the end of the day, getting locked in pricing agreements on some of these things isn't probably realistic, but being in a favored nation status that we're first in line to be able to take advantage of both supply and price is what we've been able to do. So we feel quite good about where we are relative to some of the critical components like memory chips and stuff. But I think as others have talked about, over time, this will evolve into other components and stuff, and we're already focused on that.

So feel quite good about the work that Will and the team have done broadly to be able to secure what we need to obviously deliver to our customers here, not only in the rest of the year, but into '27.

Operator

Our next question comes from the line of Robert Marcus with JPMorgan.

Robert Marcus

Congrats on the quarter. Two for me. First, -- can you talk to the guidance? It looks like it's factoring in a somewhat lower fourth quarter than -- the Street was expecting. And -- any early thoughts on '27, both top and bottom line. You do have some tariff refunds to overcome strong order growth trailing 12 months, can that translate into accelerating sales growth for next year? And then I have a follow-up.

Peter Arduini

Robbie, thanks for the question. I'll start maybe just on the '27 piece and then toss over to Bill to talk about implied Q4 on the rest of the year. I mean, obviously, we'll give guide for '27 as we normally do out in February. But I would say, look, there's a lot of moving parts. The momentum you can see this year on top line, we believe, will continue. Both what you're seeing from an order funnel, the translation of the backlog, how that's translating into revenue. So we feel good about the setup that we have moving into '27.

And on the bottom line, it's a similar story. I think the majority of this year hasn't been heavily impacted by our new products that actually have higher gross margins. We'll see a higher percentage of that -- we do have some scenarios on tariffs and stuff, which we're in a little bit better position, but I would caution the fact to say that there's no static tariff rates these days. We have to see how some of that plays out.

But in the world that we see today, we're in pretty good shape -- and then on variable cost productivity and price, we've been able to offset some of the major costs, not all of them with the combination of the 2.

And I would expect all that obviously going to play through into '27. Maybe Bill, you can talk a little bit more about how we're thinking about the guide here for this year.

William Grogan

Yes. No, thanks, Pete. Exiting the third quarter, I think we feel good about the momentum right? We're building across the business and heading into the fourth quarter, our backlog is up 12% versus the prior year. We had another solid quarter of top line growth from an expectations perspective with healthy margin and EPS expansion, right, with margins coming in sequentially higher versus the third quarter.

On the top line, though AIS and PDx will drive growth for us in Q4. As I said in the prepared remarks, PCS' growth will be muted a bit due to the product hold catch-up that we experienced last year, but they will grow sequentially and have healthy year-on-year margin expansion. So the implied Q4 growth range of that 3% to 4% is really more around the PCS product hold versus any deceleration we see in the market. So I think the guide appropriately reflects the strength we've seen while remaining mindful about the dynamic macro environment.

Robert Marcus

Great. Maybe a quick follow-up here. PCS had been trending pretty negatively year-to-date, had a really strong quarter here. How do we think about the underlying versus any onetime items? And if it is all underlying strength, what's driving that to shift so positively.

Peter Arduini

Yes, Robbie. Look, I think on PCS, and I'd mentioned this in some previous calls, we actually had some installations that had timing-wise, moved out more to the second half on monitoring projects. that's playing out as we had thought. And so again, those aren't onetime things. We're going to see that continue to play out through into the beginning and on through into the beginning in '27, but 1 of the bigger challenges we had in Q1, Q2 is just some of the supplier issues. And the team has really doubled down using our management system, our beat again, to really focus on getting out with our suppliers, where we've had supply constraints, how that ties out to demand capacity planning, both in our plants as well as with our customer sites.

And I mentioned this focus on standard work and daily management. Think about it this way. I mean, this team has moved really from kind of a monthly, weekly cadence to weekly daily cadence and making sure that were there any gaps relative to product capabilities, if there's any take issues relative to parts and components that they're addressed. And I think they've got the right rhythm in place. And so we would expect that you're going to see continued improvements here from this point forward on PCS.

Operator

Our next question comes from the line of Joanne Wuensch with Citi.

Joanne Wuensch

Good morning. Bill, welcome to the GE Healthcare team. I'm curious what your first impressions are. How you're thinking about what you may implement or view differently for guidance -- and anything you feel like sharing with us now that you're here?

William Grogan

Yes. No, I appreciate the question. So maybe if I started out with just one of the things that attracted me to GE Healthcare, along with what I'm seeing because I think they're fairly consistent. And there was a few things that I think we're at the top of mind as one, I made the decision and to my observations through the first 6 weeks. And first off, it starts with the purpose and culture, right? The purpose of creating a world where health care has no limits, is deeply embedded and help people make decisions here right? And there's a clear connection between our innovation and the impact we have for patients and customers. That was really important to be part of an organization that was mission focused right? I see a lot of opportunities to improve patient outcomes and expand access to care at a global scale.

And that's incredibly compelling and I think a huge opportunity for us. And I think the second thing is really around the growth opportunity. We've highlighted some things within our prepared remarks and some comments Pete has made, but I think we're at the forefront of health care innovation, right? We've got a strong technology portfolio and product pipeline. We've got this new phase of innovation that I think will be extremely impactful, leveraging our growing capabilities in AI and digital. We have this huge installed installed base and really deep relationships with our customers. So I think bringing all those things together creates a compelling opportunity for long-term growth.

And then lastly, I think it's really around a meaningful opportunity for me to help partner with the teams on driving operating performance through Heartbeat. I've seen strong business systems really have a big impact on results within organizations. -- where they have a desire to continuously improve and a willingness to try and things to continue to deliver for their customers, right, that philosophically, but we've also seen it in practice. So right the heartbeat methodology and the program that we have is increasingly embedded in how the teams operate here, and I think it's a further opportunity to continue to drive rigor and productivity and just general consistency along a lot of things we do across the organization.

And then maybe last thing I'd say is just the quality of the leadership team. Obviously, there's a significant appreciation to partner with folks like Pete and the balance of the management team that's really committed to executing for our customers and this great opportunity to drive long-term shareholder value.

Operator

Our next question comes from the line of Lawrence Biegelsen with Wells Fargo.

Larry Biegelsen

Two for me. One on OmniPage, it's an important product for you. You know a competitor is guiding to $50 million plus in generic OmniPig sales for next year. What share that do you think comes from GE Healthcare? And how does generic OmniPay impact your ability to grow PDx at high single-digit rate, which is your midterm goals? And I had one follow-up.

Peter Arduini

Yes, Larry. Look, thanks for the question. I'm not going to comment on maybe the entry just what their proposal of what they may do or not do. But again, just to remind you and others is that this is a generic market already. It's been for over 15-plus years. There's been a half dozen plus players that have been come in and come out of the marketplace. And so Again, it's not as a first proprietary product with its first generic change coming in. That's not the dynamic we're dealing with here. We'll see how it ultimately plays out. This is a business that you need to actually have multiple SKUs. You need to have integration with injectors all of those things that play out in the marketplace.

But I do think one of the most important parts, is this market right now today capacity is maxed out. So if you take a look at demand, demand in many cases with supply is right at an equilibrium where in some quarters, some months or almost minimizing that out. So I think an entrance that comes in that has some level of supply, it will be worked within the industry. We're expecting this whole market to grow we've mentioned this in previous sessions, almost 2x over the next 7 to 10 years.

So and a product like this because it's changeable, not only with us, but with anybody else in the marketplace. It's going to fill the gap of the opportunities that exist. So we believe they'll take a little bit of business, I think it will be from the broader marketplace, not just from GE Healthcare, but we feel quite good about our positioning. And again, this isn't the first time that we faced a generic player coming into the marketplace.

Larry Biegelsen

Yes. Just wanted to confirm PDx is still a high single-digit grower. And my -- for my second question, new CFO here, by built nice to me, too. Are the midterm targets still intact? And how should we think about the past your 2028 goals in '27? Just asking Robbie's question a little bit, differently.

Unknown Executive

Yes. Sure, Larry. I mean, look, on PDx, we feel quite good about its growth. It's been growing double digits. The radiopharmaceutical side is growing significantly faster. That's going to continue based on all my previous comments, but we feel good about that. And look, on medium term, I'll comment and then maybe have Bill make a few comments -- we continue to feel good about the medium-term targets, full stop. I think on top line, we're seeing strong progress here. We've talked about being a mid-single-digit grower.

I think if you look at our trailing 12 months, we're roughly at 5%. That's mid-single digit saw this quarter, Larry. And then on margin, while the macroeconomic environment has created some headwinds for us, I think we found space and oxygen and what we've been able to do with platforms cost productivity and also price. So we feel good about both top and bottom line metrics in the midterm, which, again, we've defined by the '28 numbers. So Bill, I don't know if maybe you want to add some comments.

William Grogan

I appreciate the question, Larry. So so relatively early in my tenure what I've seen so far gives me confidence in the direction we're headed. To Pete's point, on the growth side, I think the fundamental drivers of the market are strong, and we have this wave of new product introductions that are differentiated and customers are really excited about. Then on the margin side, right, I think there is the foundational elements of progress on the margin aspirations that we have. I think is a big part of just leveraging the strong top line growth with better product mix with these new product introductions we have and then building the productivity engine through Heartbeat and the benefits that a strong operating system has.

And I'm looking forward to partnering with the teams on that, bringing some of the things that out of my tool set to help kind of enhance the capabilities. So I know that will be a huge driver of our gross margin improvements going forward.

Operator

Our next question comes from the line of Ryan Zimmerman with U.S. Bancorp. BTIG.

Ryan Zimmerman

Bill, congrats. Good to have you in Chicago or it be all brewers talk, I think, on this call. So it that. So just a couple of questions for me. First, there's been some dynamics in in the general imaging ultrasound market. Siemens pulling back a little bit, Philips having some recalls.

Pete, you made some comments about ultrasound your commitment to it. Remind us what the opportunity is for GE Healthcare. And do you see maybe some near-term benefit from the disruptions that are occurring in that segment of the market?

Peter Arduini

Look, to your point, I mentioned this on the call, general ultrasound imaging ultrasound is a super important market for us. It's an important market in the U.S. but it's actually a growing market around the world, multipurpose capabilities, Southeast Asia, Latin America. We see this in Eastern Europe as well. It's an entree into multiple use that then moves into specialization. And actually having those products that way is critical -- for us, this is a big business.

In many cases, I understand while some people made decisions where they are, we're actually quite formidable in the space. It's a critical platform for us globally. And so -- as a result of that, we've continued to invest. When you hear the brand name Logic, which is the most well-known brand in general imaging around the world, it has been a significant winner, I'd say, in the space. As we talk to customers, obviously, when you have a fleet of products, you want to be able to grow on it and build it over years. we think there will be some opportunities that will play out for us ultimately.

But this, again, has been one of our strong suits for many, many years and the platforming work that Phil and the team have done in ultrasound that leverages cost but productivity. This also will benefit across this platform. So we think it's a great business, and you're going to see us continue to invest and take advantage of what market opportunities arise.

Ryan Zimmerman

Understood. And maybe turning to tariffs and margins. I appreciate your comments. As I think about next year's numbers, and again, I appreciate that we're not going to get guidance. But -- the Street is not assuming really a whole lot of margin on the gross margin line for next year. In fact, it's roughly flat. And so Bill, this isn't water filtration, but it still has the same impact on -- there is still tariffs to deal with. And so I'm wondering if you can kind of elaborate on kind of what the dynamics are from a tariff standpoint. -- how you think about that impact for next year? I know Robbie called out the tariff refund headwind.

But certainly, there's still a tariff component to consider as we think about next year. And frankly, can we see margins expand in '27.

Peter Arduini

Maybe I'll start and then maybe I have George here just kind of reconcile what we said for this year. And then Bill, if you want to jump in, just commentary for next year, I think that would make sense. But look, obviously, on the whole tariff piece on guide, as I mentioned, we'll talk more about that as we get into our '27 guide window. But we're regarding the biggest uncertain thing on tariffs out there is what happens with Section 232.

That's the -- probably the biggest swing item out there. I'm assuming we'll probably hear more this year about how that played out. We've been planning as though those will be increased rates at some level. And so what does that mean? We're preparing for cost productivity -- we've actually moved components. We've talked about, we've moved certain system scenarios to countries to be able to offset some of that. So our focus is how things play out we want to make the right actions and take the right actions to still be able to have an accretive model. I mean that's part of our plan that we're going in there.

George, you may want to comment just on what we stated here in the quarter and how to think about it.

Unknown Executive

Yes, sure. So in the third quarter, our tariffs are down year-over-year. That's a result of a couple of things. One is the mitigation actions that the team has been driving. Secondly, is just the lower overall rates that we're seeing. And then there was about $4 million of IEEPA tariff refunds related to 2026 that we recognized in the quarter. consistent with how we treated this in 2Q '26, we did adjust out about $9 million of refunds related to 2025. And Bill, do you want to comment on...

William Grogan

Yes. I mean, to your point about next year, obviously, between tariffs and inflation, I think both are going to be persistent. So assuming kind of a steady state to where we're at, at current levels. I think we feel good about our ability to mitigate those actions through the team's ability to get increased pricing continue to build our capabilities there and then a significant amount of supply chain actions, where we've done things internally and then partnered with key suppliers to minimize some of the volatility and reduce our exposure. So obviously, we'll give you more context when we come out in 2027. But overall, I understand it's an issue, but confident in the team's ability to mitigate it.

Operator

Our next question comes from the line of Jason Bednar with Piper Sandler.

Jason Bednar

Pete, you and the team have been talking about realizing price to a greater degree. That's been a clear part of the strategy. Can you talk about where you're adding this journey of capturing price? And are you finding even more headroom here real time on pricing as a result of passing through inflationary pressures that you're experiencing?

Peter Arduini

Yes, Jason, look, I mean pricing is always tough in this business, mainly because obviously, our customers run at very low margins. We're sensitive to that. We try to make sure we look at all of the things around the edges first. And so obviously, there's been some cases here where we've had to take actual list price or price increases on certain products. We do that selectively. I think an important aspect of our whole NPA process does the product bring really differentiated productivity and outcomes for a customer.

And when those match up paying more for price that you're going to see threefold in productivity changes in a world where you have employee shortages and in a world where you're really looking for productivity that's really the match up that we go for. And we've got quite a few new products coming out that hit that mark. And so that's probably the top piece. We focused our incentives with our sales force to make sure that we obviously get volume, but we get volume with the right level of margins in price, and we've leaned in more to that most recently.

I would also say just thinking about configuration management is a big deal here. And I think you appreciate in capital equipment when you have many different options and stuff getting the right configs and the right place in there. All of those things are playing out. But again, pricing in general in our world is a good pricing outcome is a 1% to 2% window. And I think those are a lot of the efforts that have been in place across the board.

Jason Bednar

All right. And then just a follow-up. Historically, Peter, I think you've usually had a portion of the current and future quarter already spoken for with equipment installed and install schedules. Just can you help with where you're at relative to historical averages, both for the current fourth quarter and as you look at that install schedule as we line up for 2027.

Peter Arduini

Yes. I mean it starts with Jason, having a record backlog. We obviously aid in a little bit this quarter, but I think year-to-date, we're up over a couple of billion dollars. So I mean that's a tremendous asset for us. And so as you look out into '27, even into '28, we have delivery dates that match up into that. If I were to say Q4 versus Q3, we're right in the same normal range that we would be, which is a high secured rate, meaning how much new business do you actually have to sell within the quarter to make your numbers. The vast, vast majority of it is already on orders that we've taken. We validated that the site is ready. We're working with the customer because they want the equipment. So it's very much in line to what we had spoken about in Q3.

Operator

Our next question is from the line of Vik Chopra with BMO Capital Markets.

Vikramjeet Chopra

Bill, welcome, looking forward to working with you. And maybe just the first question on PCS. -- does that leadership change that you called out in the press release this morning, does that impact the time line of the strategic review? And could it delay a decision? And then I had a quick follow-up, please.

Peter Arduini

Yes. Thanks for the question. The short answer is no, it does not. Look, we're very happy actually for Jeannette public company CEO jobs don't come around that often. We're happy for it because it's not competitive with us that makes us even more happy. But as I mentioned, the critical #2 leader who's stepping into the role, Neil knows this business extremely well, has been heavily involved in actually leading much of the work around the strategic segment. So there's no impact relative to how we're thinking about things or the impact of the recovery work. I mean, Neil has been deep into that as well.

Vikramjeet Chopra

Okay. Great. And then 1 on Sofie for me. I think they already manufacture for Cato, I'm just curious if owning Soffe speeds up the ramp. And can you disclose what percent of Forcare doses it supplies today?

Peter Arduini

Yes. I won't disclose competitive reasons, the percentage, but I think you can appreciate we're pretty well distributed and spread out across multiple players is based on how this works. But -- it's a good question. I mean, look, I would just say part of the really exciting part about radiopharmaceuticals, there's many ways to play across the ecosystem and participate in revenue that's accretive and margins that are accretive to GE Healthcare. And so I would think less about Sofie as terms of the Flacado ramp, although it has the potential to benefit us and more of the terms of this broader opportunity that we see across the board.

And again, having, owning some of your manufacturing base in most scenarios is obviously a positive thing, particularly in radiopharmaceuticals, we believe it's a very important aspect. Think about the pipeline of the future of therapeutics as well as diagnostics. I believe there's over 500 molecules in development as we speak. So that's an exciting opportunity. And Radiopharma is different than traditional pharmaceuticals because these tracers have short half-life, meaning by the end of the day, they're gone.

And so you can't simply manufacture them centrally and hold inventory for extended periods. You need to make it every day. So now we're deeper into that process, which clearly helps us control more of our supply chain, but it also allows us to participate. We're going to be dependent in working with other CMOs for a very long period of time. This just gives us more ownership and integration to play a significant role within that channel. So we're excited about it. Obviously, we need to get the deal closed, but that's part of the strategy of why we were so interested in Soffe.

Operator

Thank you. That concludes the question-and-answer session. Please proceed with any closing remarks.

Peter Arduini

Yes. Thank you, operator, and I thank all of our investors for your interest in GE Healthcare. We're looking forward to seeing many of you at the radiological side in North America and Chicago, known as RSNA. I think you're going to see lots of our new products in phase. So we're hoping that many of you can join us. Also, we're going to be showcasing significant amounts of new AI-enabled products integrated at a departmental level, integrated at a hospital level. Many of the things that we've talked about, D3 and actually are going to see live actually on the floor. So we're super excited about it. This RSNA is a really pivotal window for us for many of those new products that will impact our growth profile and profit profile in '27 and '28. So with that, we'll conclude our call. Thank you very much.

Operator

This concludes today's conference. Thank you for your participation. You may now disconnect.