Philips set about to redefine itself in 2016 even as it celebrated its 125th year, spun out its legacy lighting business as a separately traded concern, and dealt away its combined Lumileds and automotive lighting businesses.
Last year also marked Philips’s successful integration of its Volcano acquisition, the Dutch company told us. Philips made another big buy, closing its $2 billion play for Spectranetics in August 2017. The company also made a raft of smaller buys in personal health, diagnosis & treatment and innovation, including Electrical Geodesics, TomTec, RespirTech, Wellcentive, PathXL and the VersaVue and DynaCAD assets from iCad. And Philips sold another business, the Sonalleve MR-HIFU operation, to Profound Medical.
Looking ahead, the company said it plans to increase its productivity by lowering the cost of goods, non-manufacturing costs and “the cost of non-quality,” all while “embedding the digital transformation in every aspect of its operations.” Philips said it’s also eying its core businesses for growth, “by executing more effectively on customer partnerships, further transforming the business model from ‘transactional’ to one of ‘long-term partnerships’, with shared business goals and recurring revenue streams.”
“Philips is driving future growth and profit expansion with its shift to solutions. The company is investing strongly in research and development for value-added, integrated solutions along the health continuum, most notably in the areas of precision diagnostics, cardiology, oncology, respiratory and population health,” the company told us.