Abbott Laboratories to spin off nutrition division

Abbott Laboratories has announced plans to spin off its nutrition business into a separate, publicly traded company, a process expected to be completed by the end of 2027. The nutrition arm, which includes brands such as Similac, Ensure, and Pedialyte, generates approximately $8.5 billion in annual sales.

The decision follows a period of challenges for the division, including a 2022 baby formula recall and the temporary shutdown of a manufacturing plant in Sturgis, Michigan, which contributed to a nationwide shortage. The unit has also faced significant legal liabilities and litigation related to infant formula products.

By separating the units, Abbott aims to become a leaner entity focused on medical devices, diagnostics, and medicines. CEO Robert Ford stated that the nutrition business will be better positioned as an independent company to meet rising demand for healthy nutrition, while Abbott’s core portfolio pursues its own growth opportunities.

Following the announcement, Abbott lowered its 2026 sales growth forecast to approximately 6%, down from a previous range of 6.5% to 7.5%. The company also tightened its full-year adjusted profit per share forecast.