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Koninklijke Philips N.V. (PHG)
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Koninklijke Philips (PHG) AI Stock Analysis

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PHG

Koninklijke Philips

(NYSE:PHG)

Rating:56Neutral
Price Target:
$29.00
▲(9.60%Upside)
Philips' overall stock score of 56 reflects its current financial struggles, with declining revenues and profitability challenges being significant concerns. The technical analysis suggests a strong momentum, though caution is advised due to overbought indicators. The earnings call provided a balanced view with some positive outlooks, but valuation remains an issue due to negative earnings. The potential for recovery exists if operational improvements and revenue growth continue.

Koninklijke Philips (PHG) vs. SPDR S&P 500 ETF (SPY)

Koninklijke Philips Business Overview & Revenue Model

Company DescriptionKoninklijke Philips N.V. operates as a health technology company in North America and internationally. It operates through Diagnosis & Treatment Businesses, Connected Care Businesses, and Personal Health Businesses segments. The company provides diagnostic imaging solutions, includes magnetic resonance imaging, computed tomography (CT) systems, X-ray systems, and detector-based spectral CT solutions, as well as molecular and hybrid imaging solutions for nuclear medicine; integrated interventional systems; echography solutions focused on diagnosis, treatment planning and guidance for cardiology, general imaging, obstetrics/gynecology, and point-of-care applications; proprietary software to enable diagnostics and intervention; and enterprise diagnostic informatics products and services. It also offers acute patient management solutions; emergency care solutions; sleep and respiratory care solutions; and electronic medical record and care management solutions. In addition, the company provides power toothbrushes, brush heads, and interdental cleaning and teeth whitening products; infant feeding and digital parental solutions; and male grooming and beauty products and solutions. It has a strategic collaboration with Ibex Medical Analytics Ltd. to jointly promote the digital pathology and AI solutions to hospitals, health networks, and pathology laboratories worldwide, as well as a strategic partnership agreement with NICO.LAB. The company was formerly known as Koninklijke Philips Electronics N.V. and changed its name to Koninklijke Philips N.V. in May 2013. Koninklijke Philips N.V. was founded in 1891 and is headquartered in Amsterdam, the Netherlands.
How the Company Makes MoneyPhilips generates revenue through the sale of its health technology products and services. The company's revenue streams include the sale of medical diagnostic imaging equipment, patient monitoring devices, and personal health products, such as sleep and respiratory care devices. Additionally, Philips earns income from providing healthcare consulting, software solutions, and maintenance services to hospitals and healthcare providers. Strategic partnerships with healthcare institutions, governments, and technology companies also contribute to its earnings, as does its focus on expanding its presence in emerging markets. Philips' business model relies heavily on innovation, leveraging its research and development capabilities to sustain growth and adapt to the evolving healthcare landscape.

Koninklijke Philips Earnings Call Summary

Earnings Call Date:Jul 29, 2025
(Q2-2025)
|
% Change Since: 3.12%|
Next Earnings Date:Nov 04, 2025
Earnings Call Sentiment Neutral
Philips' earnings call presented a balanced view, with strong order intake growth and margin expansion offset by declines in certain segments and challenges in China. The company is optimistic about the second half of 2025, with improved outlooks for free cash flow and EBITA margin, despite the ongoing tariff impacts.
Q2-2025 Updates
Positive Updates
Order Intake Growth
Order intake grew by 6% in Q2, building on a 9% growth from the previous year, with strong performance across North America and growth geographies.
Margin Expansion
Comparable sales increased by 1%, and margin expanded by 130 basis points to 12.4%, driven by innovation and productivity measures.
Innovations in Diagnosis & Treatment
Strong demand for recently launched innovations in Image-Guided Therapy and Precision Diagnosis, with double-digit order growth in these areas.
Improvement in Personal Health
All three businesses within the Personal Health segment grew, with strong traction from new innovations and partnerships with high-performing retailers.
Supply Chain and Quality Improvements
Service levels reached an all-time high of 86%, and product updates and field actions were reduced by approximately 20%.
Positive Free Cash Flow Projections
Full-year free cash flow is expected to be between EUR 0.2 billion and EUR 0.4 billion, an increase from the previous outlook.
Negative Updates
Decline in Diagnosis & Treatment Sales
Comparable sales in Diagnosis & Treatment decreased by 1%, attributed to a high comparison base from previous years.
Challenges in China
Performance in China continued to lag due to subdued consumer sentiment and a slow recovery in the medical equipment market.
Tariff Impacts
The dynamic tariff landscape is expected to have a net impact of EUR 150 million to EUR 200 million on 2025 results.
Connected Care Sales Decline
Connected Care sales declined by 1%, primarily due to a low single-digit decline in Monitoring, against a high comparison base.
Company Guidance
During Philips' second quarter and semiannual 2025 results conference call, the company reported significant metrics and provided guidance for the remainder of the year. Order intake grew by 6% compared to the previous year, driven by strong performance in North America and growth geographies. Comparable sales increased by 1%, with Personal Health showing strength, while Diagnosis & Treatment (D&T) and Connected Care experienced varied results. The margin expanded by 130 basis points to 12.4%, reflecting the impact of innovations and productivity measures. Philips maintained its full-year comparable sales growth outlook at 1% to 3% and increased its 2025 adjusted EBITA margin range to 11.3% to 11.8% due to recent tariff developments. Additionally, the company expects full-year free cash flow to be between EUR 0.2 billion and EUR 0.4 billion, dependent on the current tariff levels holding. The company highlighted strong order intake in Diagnosis & Treatment, particularly in Image-Guided Therapy and Precision Diagnosis, and resilient demand in Connected Care. Personal Health achieved growth in all segments, supported by partnerships with major retailers. Philips emphasized ongoing efforts in quality management and supply chain reliability, achieving a service level of 86% in Q2. Looking ahead, the company plans to host a Capital Markets Day in February 2026, focusing on accelerating profitable growth and strategy beyond 2025.

Koninklijke Philips Financial Statement Overview

Summary
Koninklijke Philips faces profitability challenges with declining revenues and net losses, though operational improvements have led to some signs of stabilization. The balance sheet remains stable, but the equity position is under pressure. Positive cash flows indicate resilience, highlighting the need for enhanced earnings quality.
Income Statement
45
Neutral
Koninklijke Philips has experienced a declining revenue trend from its peak in 2020. The gross profit margin has also decreased over the years, indicating challenges in cost management or pricing power. The company has been suffering net losses in recent years, which impacts the net profit margin negatively. The EBIT margin is low, though there has been an improvement in the latest year, suggesting some operational recovery. Overall, the income statement reflects a company facing profitability challenges with some signs of stabilization.
Balance Sheet
50
Neutral
The balance sheet shows a moderate debt-to-equity ratio, which suggests a balanced leverage position but with room for improvement. The equity ratio indicates a relatively stable financial foundation, though the decline in stockholders' equity over recent years could be a concern. Return on equity is negative due to net losses, highlighting the need for improved profitability. Overall, the balance sheet reveals a stable yet potentially vulnerable position due to ongoing losses.
Cash Flow
60
Neutral
Philips has managed to generate positive operating cash flow, with free cash flow remaining positive recently, despite capital expenditures. The free cash flow growth rate has been fluctuating, reflecting challenges in maintaining consistent cash generation. The operating cash flow to net income ratio is healthy, indicating that cash generation is stronger than earnings performance would suggest. Overall, the cash flow statement shows resilience in cash management but underscores the need to enhance earnings quality.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue18.02B18.17B17.83B17.16B19.54B
Gross Profit7.77B7.45B7.19B7.17B8.78B
EBITDA1.92B1.04B115.00M2.00B2.75B
Net Income-702.00M-466.00M-1.61B3.32B1.19B
Balance Sheet
Total Assets28.98B29.41B30.69B30.96B27.71B
Cash, Cash Equivalents and Short-Term Investments2.40B1.87B1.18B2.31B3.23B
Total Debt7.49B7.29B8.20B6.98B6.93B
Total Liabilities16.93B17.34B17.41B16.49B15.81B
Stockholders Equity12.01B12.03B13.25B14.44B11.87B
Cash Flow
Free Cash Flow893.00M1.49B-979.00M866.00M2.15B
Operating Cash Flow1.57B2.14B-173.00M1.63B2.64B
Investing Cash Flow-573.00M-636.00M-1.49B-3.67B-1.27B
Financing Cash Flow-496.00M-848.00M500.00M-2.35B483.00M

Koninklijke Philips Technical Analysis

Technical Analysis Sentiment
Positive
Last Price26.46
Price Trends
50DMA
24.03
Positive
100DMA
24.03
Positive
200DMA
25.08
Positive
Market Momentum
MACD
0.77
Negative
RSI
60.55
Neutral
STOCH
51.16
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PHG, the sentiment is Positive. The current price of 26.46 is above the 20-day moving average (MA) of 25.15, above the 50-day MA of 24.03, and above the 200-day MA of 25.08, indicating a bullish trend. The MACD of 0.77 indicates Negative momentum. The RSI at 60.55 is Neutral, neither overbought nor oversold. The STOCH value of 51.16 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PHG.

Koninklijke Philips Peers Comparison

Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
80
Outperform
$155.95B62.7411.71%21.45%36.19%
73
Outperform
$221.54B15.9231.01%1.82%5.85%152.28%
71
Outperform
$46.53B54.4416.73%-5.23%-40.13%
69
Neutral
$144.38B49.9914.25%0.88%11.36%-15.66%
56
Neutral
$25.26B-7.10%3.35%-0.76%-55.03%
51
Neutral
$7.38B0.34-69.01%2.37%16.35%0.39%
48
Neutral
$8.13M-151.23%3.30%31.84%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
PHG
Koninklijke Philips
26.46
-0.73
-2.68%
ABT
Abbott Laboratories
127.29
20.71
19.43%
BSX
Boston Scientific
105.41
32.45
44.48%
EW
Edwards Lifesciences
79.33
18.63
30.69%
SSKN
Strata Skin Sciences
1.95
-1.21
-38.29%
SYK
Stryker
377.79
64.68
20.66%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 30, 2025