Johnson & Johnson's stock heads for a record after a profit beat and plans for another spinoff

By Tomi Kilgore

The orthopedics business, which generated 10% of 2024 revenue, will be separated from J&J within two years, after its consumer health business was spun off as Kenvue in 2023

Johnson & Johnson's stock was heading toward a record after a beat-and-raise earnings report and plans to separate its orthopedics business.

Shares of Johnson & Johnson were rising into record territory in early trading Tuesday, after the medicines and medical-technology giant beat quarterly earnings expectations and raised its outlook, while also announcing plans for another spinoff.

The company said it would separate its orthopedics business to operate as DePuy Synthes to strengthen its focus on its core businesses. The separation, which is expected to be completed within 18 to 24 months, comes after J&J (JNJ) completed the spinoff of its consumer-health business into Kenvue Inc. (KVUE) in 2023.

J&J said the separation of orthopedics, which generated $9.2 billion in revenue in 2024, or 10.4% of total revenue, will increase overall revenue growth and improve profitability, given the improved focus.

The stock rose 0.8% in premarket trading, putting it on track to open above the Oct. 9 record closing price of $191.08.

The company also reported third-quarter revenue that rose 6.8% from a year ago to $23.99 billion, above the average analyst estimate compiled by FactSet of $23.76 billion, as both its innovative medicine and MedTech businesses grew revenue by 6.8%.

The company also raised the midpoint of its 2025 revenue guidance range to $93.7 billion from $93.4 billion, marking the third straight quarter in which the outlook improved.

J&J said quarterly net income increased 91.2% to $5.15 billion, while adjusted EPS, which excludes nonrecurring items, of $2.80 was above the FactSet consensus of $2.76.

The company kept the midpoint of its 2025 EPS guidance range unchanged at $10.85.

The stock has run up 32% in 2025 through Monday, while the S&P 500 index SPX has advanced 13.1%.

-Tomi Kilgore

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10-14-25 0744ET