Shares of Bausch Health Companies Inc (BHC) tumbled 5.01% in Wednesday's trading session, following the release of disappointing quarterly results from its majority-owned subsidiary, Bausch + Lomb.
Bausch + Lomb, the eye-health company, reported a swing to a loss in its latest quarter, despite a rise in revenue across its business segments. The company recorded a net loss of $28 million, or 8 cents per share, compared to a profit of $4 million, or 1 cent per share, in the same period last year. This unexpected loss appears to have sparked investor concerns about the overall financial health of Bausch Health Companies.
While Bausch + Lomb's revenue increased by 7.1% to $1.28 billion, in line with analyst expectations, the market seems to have focused on the bottom-line performance. The company's vision care revenue was up 7.6% to $736 million, surgical revenue rose 4.4% to $215 million, and pharma revenue increased 7.8% to $330 million. However, these positive revenue trends were overshadowed by the reported loss, likely due to an increase in the company's income tax provision.
The market's negative reaction to Bausch Health Companies' stock suggests that investors are concerned about the potential impact of Bausch + Lomb's performance on the parent company's financials. As Bausch Health continues to work on possible alternatives for spinning off its eye-health subsidiary, this quarterly loss may complicate these efforts and create uncertainty about the company's future structure and profitability.
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