Fisher & Paykel Healthcare warns of cost pressures from Donald Trump’s Mexico trade tariffs
The medical device manufacturer is the first ASX-listed company to warn of a hit to earnings from Donald Trump’s decision to place tariffs on Mexican and Canadian imports.
Fisher & Paykel Healthcare has become the first ASX-listed company to warn of a hit to earnings from US President Donald Trump’s decision to place tariffs on Mexican and Canadian imports.
The medical device manufacturer on Monday said the tariffs would increase the company’s costs and delay plans to achieve a 65 per cent gross margin by up to three years.
It doesn’t currently expect a material impact on its profit for the current fiscal year.
Fisher & Paykel currently manufactures about 45 per cent of its volume in Mexico, with facilities in the country accounting for 60 per cent of volume supplied to the US. The world’s largest economy accounts for 43 per cent of the group’s revenue. The other 55 per cent of manufacturing comes from New Zealand.
Chief executive Lewis Gradon said the company would work with global suppliers and US customers to provide solutions to mitigate the impact of the tariffs on all parties.
“Fundamentally, our products and therapies are designed to improve care and outcomes for patients and to reduce the overall costs of providing healthcare,” he said.
“Across the business, we are continuing to make improvements that reduce costs or improve efficiencies. This proven combination is how we navigate all the various cost challenges that come our way over time.”
On February 1, the US introduced a 25 per cent tariff on products imported from Mexico and Canada, and a 10 per cent tariff will be imposed on products imported from China.
White House press secretary Karoline Leavitt said the duties were in response to “the illegal fentanyl that they have sourced and allowed to distribute into our country”.
The company, which is listed on both the NZX and ASX, continues to expect to reach its gross margin target of 65 per cent through longstanding improvement activities across the entire business, coupled with efficient growth.
Mr Gradon said the US tariffs announced on the weekend might have added two to three years to that expectation.
“The company is currently working through the complexities associated with the imposition of the tariffs and will provide an update on outlook for the 2026 financial year as well as an updated estimate of the timeframe to return to the gross margin target, at its full-year results at the end of May,” he said.
Fisher & Paykel is a designer, manufacturer and marketer of products and systems for use in acute and chronic respiratory care, surgery and the treatment of obstructive sleep apnea. The company’s products are sold in over 120 countries worldwide.
Shares in Fisher & Paykel were down 5.4 per cent to $32.50 on the ASX early Monday morning.
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