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Baxter is a medical-products company in the middle of a difficult restructuring, and the FY2025 financials show the strain. Revenue grew 5.7% to $11.2B, but profitability went the wrong way: gross margin fell to 30.1% (gross profit down 15.2%) as cost of sales rose faster than sales, and operating income swung to -$308M from a barely-positive prior year, dragged down by a $485M goodwill impairment. The net loss widened to -$957M (EPS -$1.87), the company's second consecutive loss and part of a wildly volatile earnings record (-$2.43B, +$2.66B, -$649M, -$957M over FY2022-2025). ROE is -15.6% and net margin -8.5%.

The capital structure is a concern. Long-term debt remains heavy at $9.44B even after a 28.4% reduction (the decline largely reflects deconsolidation of discontinued operations rather than organic deleveraging), against just $6.13B of equity (2.28x liabilities/equity). Operating cash flow fell 17.1% to $845M while capex rose 15.0% to $513M, squeezing free cash flow. Most tellingly, management cut the dividend 41% to $348M — a clear signal that the board is prioritizing balance-sheet repair over shareholder returns, and a red flag for income holders.