Gilead Sciences, Inc. (NASDAQ:GILD) and Abbott Laboratories (NYSE:ABT) both return cash to shareholders through dividends, but the businesses supporting those payouts look very different.
Gilead is currently growing faster, powered by an HIV franchise that continues to gain momentum, while Abbott is offering considerably more diversification across medical devices, diagnostics, nutrition and established pharmaceuticals, as well as a much longer record of consistent dividend increases.
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For income-oriented investors, that creates an interesting trade-off between Gilead’s stronger current growth and Abbott’s broader business mix.
Bull Case
Gilead’s (NASDAQ:GILD) underlying business had a strong second quarter, where it saw product sales excluding Veklury increase 10% to $7.6 billion, while HIV sales grew 12% to $5.7 billion. Biktarvy sales increased 7% to $3.8 billion, Descovy jumped 48% to $967 million, and Yeztugo, Gilead’s twice-yearly injectable HIV prevention medicine, generated $232 million compared with $15 million a year earlier.
There was growth outside HIV as well, with liver-disease sales increasing 10% to $877 million. Livdelzi revenue more than doubled from $78 million to $167 million, and Trodelvy sales increased 26% to $457 million. Gilead subsequently raised its 2026 product-sales guidance to $30.1 billion-$30.4 billion and increased its outlook for product sales excluding Veklury to $29.8 billion-$30.1 billion. The company is also returning cash to shareholders and increased its quarterly dividend by 3.8% to $0.82 per share beginning in 2026.
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Abbott’s business exhibits a different strength. Second-quarter sales increased 13% on a reported basis and 4.8% on a comparable basis to $12.59 billion, while adjusted EPS increased 4% to $1.31. Medical Devices remained its largest business, generating $5.85 billion of sales. The segment grew 8.4% on a comparable basis, with double-digit comparable growth in areas including Electrophysiology and Rhythm Management.
Abbott’s (NYSE:ABT) acquisition of Exact Sciences has also given it a new growth business in cancer diagnostics. Total Diagnostics sales reached $3.09 billion, increasing 42.3% on a reported basis and 2.9% on a comparable basis. Within the segment, Cancer Diagnostics grew 13.3% on a comparable basis, driven by growth in both new and repeat Cologuard users. The company also raised its full-year adjusted EPS guidance to $5.45-$5.60 from $5.38-$5.58 while maintaining its 6.5%-7.5% comparable sales-growth outlook.
Another distinction for dividend investors is that Abbott raised its quarterly dividend 6.8% to $0.63 per share for 2026, marking its 54th consecutive year of dividend growth.
Bear Case
Gilead’s (NASDAQ:GILD) HIV business generated $5.69 billion of its $7.63 billion in fiscal Q2 product sales, meaning roughly three-quarters of product revenue came from one therapeutic area, which creates concentration risk alongside faster growth for the company. The company’s push to diversify has also been expensive, as Gilead recorded $11.2 billion in acquired in-process R&D expenses during Q2, primarily associated with its acquisitions of Arcellx, Tubulis, and Ouro Medicines. Those transactions contributed to GAAP and non-GAAP quarterly losses per share of $8.45 and $6.75, respectively.
Results outside HIV also remain uneven. Trodelvy grew 26%, but Cell Therapy sales declined 14% to $417 million amid competitive headwinds, while Yescarta fell 12%, and Tecartus declined 24%.
Abbott has a different problem for investors, which is that its broad portfolio isn’t growing evenly. Nutrition sales declined 3.6% on a comparable basis during fiscal Q2, while Rapid and Molecular Diagnostics fell 8.0%, partly reflecting lower respiratory-virus testing sales. There is also a gap between Abbott’s current companywide growth and its full-year target. Comparable sales increased 4.8% in Q2, while management maintained its full-year expectation of 6.5%-7.5%. Abbott says it expects sales and earnings growth to accelerate in the second half, making that acceleration an important part of the 2026 investment case.
The Exact Sciences acquisition has also increased certain expenses. Abbott reported $658 million of intangible amortization in fiscal Q2, up from $420 million a year earlier, while specified items included acquisition-related expenses among other charges. GAAP EPS consequently fell to $0.53 from $1.01, even as adjusted EPS increased 4% to $1.31.
Conclusion
For dividend investors, Gilead and Abbott offer very different kinds of risk. Gilead currently has the stronger underlying growth. Its base business grew 10%, HIV sales increased 12%, management raised its sales outlook, and the quarterly dividend increased 3.8%. The trade-off is heavy dependence on HIV and significant spending to build businesses beyond it.
Abbott isn’t growing as quickly on a comparable basis, but its risk is spread across a much broader portfolio. Medical Devices continues to grow strongly, Exact Sciences adds a new cancer-diagnostics business, and the company has increased its dividend for 54 consecutive years.
That makes Abbott the more diversified dividend story, while Gilead offers stronger current operating momentum. Investors prioritizing a long record of dividend growth and business diversification may find Abbott’s profile easier to underwrite, while those willing to accept greater therapeutic concentration in exchange for faster current growth may find more to like in Gilead.
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This article is originally published at Insider Monkey.
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