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Philips

Profitable growth to 2028, 2026 to 2028

Our teams around the world are focused on delivering better care for more people
Roy Jakobs, Philips’ CEO, on the second quarter of 2026

Profitable growth to 2028

Philips makes medical technology for hospitals, from scanners to patient monitors, and personal health products for the home, from toothbrushes to shavers. After three years spent on quality, supply chains, and costs, its plan for 2026 to 2028 is aimed at profitable growth.

Segment-specific strategies

  1. 01Where to compete

    Run each segment to the distinct needs of its customers, markets, and technologies: Diagnosis & Treatment, Connected Care, and Personal Health.

  2. 02How to win

    Make deliberate choices on where to compete and how to win in each.

  3. 03Capital

    Allocate capital segment by segment, to get the most from each while delivering consistent value across the portfolio.

Comparable sales rose 4% in each of the first two quarters of 2026, and every segment grew.,

Personal Health grew 9% and 8%, and sales in growth geographies grew by double digits in the second quarter.,

Personal Health is growing fastest, with the highest margin

Each segment has its own strategy. In the second quarter of 2026 every segment’s margin was lifted by a US tariff refund, which is left out here.

  1. +2%sales growth9.3%margin

    Diagnosis & Treatment

    Diagnostic imaging, image-guided therapy, and ultrasound, in hospitals

  2. +2%sales growth11.7%margin

    Connected Care

    Patient monitoring and enterprise informatics

  3. +8%sales growth18.0%margin

    Personal Health

    Personal health products at home, such as toothbrushes and shavers

Comparable sales growth and Adjusted EBITA margin. Second-quarter margins leave out the US tariff refund: 4.6, 6.1, and 5.0 points respectively.

EUR 1.5 billion of savings from 2026 to 2028

Philips delivered its EUR 2.5 billion productivity programme for 2023 to 2025 in full, and has started a EUR 1.5 billion one for 2026 to 2028. Over the same three years it aims for EUR 4.5 to 5.0 billion of free cash flow.

Productivity, 2023 to 2025

EUR 0.00bn

EUR 2.5 billion, delivered

Productivity, 2026 to 2028

EUR 0.00bn

EUR 258 million in the first half of 2026, of EUR 1.5 billion

Free cash flow, 2026 to 2028

EUR 0.00bn

EUR 250 million in the first half of 2026; EUR 1.5 to 1.7 billion guided for the year,,

The cash gauge is marked at the EUR 4.5 billion low end of the target, with 2026’s outlook outlined. First-half cash includes the US tariff refund.

A mid-teens margin by 2028

The Adjusted EBITA margin rose 80 basis points to 12.3% in 2025. The 2026 outlook was 12.5% to 13.0% in February, raised to 13.5% to 14.0% in July with about a point from the US tariff refund. The target for 2028 is a mid-teens margin, alongside mid-single-digit comparable sales growth a year; the outlook for 2026 is 3% to 4.5%.

13.5–14%

2026 outlook, July

10%11%12%13%14%15%16%17%20252026 outlook, February2026 outlook, July2028 target

  1. Finish one plan before starting the next.

    Philips announced its 2026-2028 plan on the day it reported the end of the last one: the EUR 2.5 billion productivity programme for 2023 to 2025 delivered in full. We recommend closing a plan in public, against its own targets, before setting new ones, so the new targets inherit its credibility.

  2. Separate a one-off from the trend.

    In the second quarter the Adjusted EBITA margin was 16.4%, but 4.2 points of that was a US tariff refund, and Philips reports both. We recommend showing results with and without an exceptional item, so no one plans on the one-off.

  3. Give each part of the business its own strategy.

    Philips’ first pillar is segment-specific strategies: hospital imaging, patient monitoring, and toothbrushes need different choices. We recommend letting each part of an organisation set out where it will compete and how it will win, inside one plan.

Sources

  1. 1. Koninklijke Philips N.V. (2026). Philips delivers full year 2025 with growth acceleration; announces 2026-2028 targets at Capital Markets Day. Form 6-K, 10 February 2026. sec.gov
  2. 2. Koninklijke Philips N.V. (2026). Philips delivers strong order intake, comparable sales growth and margin expansion in Q1. Form 6-K, 6 May 2026. sec.gov
  3. 3. Koninklijke Philips N.V. (2026). Philips delivers solid comparable sales growth and margin in Q2. Form 6-K, 28 July 2026. sec.gov

Headwater is not connected with Philips. Philips, Azurion, Sonicare, and OneBlade are trade marks of Koninklijke Philips N.V. Updated 29 September 2026.

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