GE Healthcare Warns of $500 Million Tariff Hit in 2025, Lowers Profit Outlook

According to an April 30 article from financial services firm Morningstar, GE Healthcare Technologies Inc. expects the global tariff war to cost the company approximately $500 million in 2025, with the bulk of the impact—around $375 million—coming from bilateral tariffs between the U.S. and China. “Bilateral China tariffs account for the majority of the impact, about 75%,” said Chief Financial Officer Jay Saccaro. While the first-quarter tariff effect was “very small,” at just $10 million, the company anticipates a steep rise in costs through the rest of the year, with impacts of nearly $100 million in Q2 and around $200 million each in Q3 and Q4. This translates to an estimated $0.85 per share for the year.

The organization reported better-than-expected earnings for the first quarter—$1.01 per share versus a projected $0.91—GE Healthcare cut its full-year earnings outlook due to these anticipated costs. The company now expects adjusted EPS for 2025 to fall between $3.90 and $4.10, down from its earlier forecast of $4.61 to $4.75. Saccaro noted that while the company is not expecting relief through tariff exemptions, a hypothetical reduction in tariff rates could improve EPS by about $0.40, although he emphasized, “I’m not suggesting that’s a likely scenario.”

Looking ahead, GE Healthcare is planning several mitigation strategies to reduce the financial burden of tariffs in 2026. These include moving more manufacturing closer to where products are sold and diversifying its supplier base. “The mitigations that we're putting in place start to rapidly impact [costs] as it draws down over the course of the rest of the year,” said Saccaro, noting that the first quarter of 2026 will still carry a similar impact to the end of 2025.

The broader healthcare and pharma sectors are also feeling the squeeze. Merck recently projected $200 million in tariff-related costs for 2025, while Johnson & Johnson warned of a $400 million hit. Other GE spin-offs are similarly affected: GE Vernova expects up to $400 million in tariff costs, and GE Aerospace projects $500 million, although both companies' stocks have shown resilience this year.