Today, Theranostics is primarily used in thyroid, neuroendocrine and prostate cancer. However, a growing pipeline of drugs across the industry for future applications include breast, ovarian, pancreatic and lung cancers show even more promise to potentially extend the length and quality of life for more patients. We expect to play an important role in the delivery of these new therapies. In the next 3 years, we plan to significantly increase our current Theranostics franchise through a combination of organic and inorganic expansions. And we’re excited about the opportunity to be a trusted partner, helping our customers navigate this important and growing field of medical imaging. This mission to improve outcomes across care pathways will be enabled by our announced intention to acquire MIM.
After close, we plan to integrate these new capabilities into GE HealthCare’s devices to enhance imaging fusion, multimodal inputs for diagnostics, therapy planning and monitoring. And by leveraging these new tools across various care areas, we can differentiate our solutions for the benefit of patients and healthcare systems worldwide, particularly around Theranostics. In closing, we’re excited about the growth potential of molecular imaging and Theranostics as well as our pipeline pharmaceuticals and the collective opportunity for these innovations to enable precision care. To summarize on Slide 16, I’m extremely proud of our team’s execution in 2023 and our focus on patients and customers as well as the progress we’ve made as a standalone company.
We achieved or exceeded our financial and operational objectives we laid out at the beginning of the year. And we’re making significant progress on the innovation front, including digital and artificial intelligence launches. We have a strong balance sheet that allows us to invest in new capabilities organically and inorganically. And we’re excited about our momentum as we enter 2024. We remain on track to deliver on our medium-term targets. With that, I’d like to open up the call for questions.
Carolynne Borders: Thank you, Peter. [Operator Instructions] Operator, can you please open the line?
Operator: Thank you. [Operator Instructions] And that will come from the line of Craig Bijou with Bank of America. Your line is open.
Peter Arduini: Good morning, Craig.
Craig Bijou: Good morning, guys. Thanks for taking the questions. So Jay, appreciate the comments on Q1. And I did want to dive a little bit deeper there. Can you guys still grow revenues in Q1, given that you do have a pretty strong year-over-year comp? And then on the margin side, should we still expect margin expansion in Q1, but maybe it’s at a rate a little bit lower than what you’re expecting for the full year?
Jay Saccaro: Craig, that’s right. Overall, as I said in my prepared remarks, the first half will be lower than the second half. And the first quarter will be lower than the second quarter. And really what this comes down to is the challenging comp that we saw in Q1 of last year. I believe we had 12% revenue growth, which was really a great performance in that quarter. Having said that, we still expect revenue growth in the first quarter and some level of margin expansion, albeit both of those lower than the full year rates.
Craig Bijou: Got it. That’s helpful. And as a follow-up, I did want to touch on China and the Anti-Corruption Act. And basically, I want to get your sense for what’s going on there? And did you grow sales and orders in China in Q4? And how should we think about that in the early parts of ‘24?
Peter Arduini: Hey, Craig, it’s Pete. Well, look, as you know, there is a lot of moving parts within China. We’ve talked a lot about this in the past. I think there is three things. I mean there is clearly a focus by the government to expand capabilities in medical coverage. And a lot of that comes down to our equipment, ultrasound CT as a first part. The second thing is there was a stimulus funding from last year, which was in Q4 and affected in Q1, where we did actually very, very well from a share and a growth standpoint. And then we have anti-corruption. What we’ve seen on the ground is it’s not that consistent in many different ways, meaning that certain provinces, there may be less. In fact, other provinces there may be more.
I think that’s going to play out and throughout the coming year. We believe overall that the approach to drive better compliance in a very large country is a good thing and that there isn’t necessarily an end date as much as it’s a new policy approach about how you do business. And for a company like us, it’s kind of how we do business every country around the world. I think that lays it out that way. That being said, last year for us in China in the first half, we had a very strong first half. We grew over 20% organic in the first half of 2023. So we’re actually expecting our growth to be negative year-over-year. That’s contemplated in our guidance in the first half and then in the second half, resuming to growth. And so that’s kind of how we profiled it, and that’s part of our 4% guidance that we’ve laid out.
Longer-term, we believe China, again, with 1.4 billion people, 400 million getting quality services today and 1 billion that need it is going to continue to be a growth market out into the future. But we’ve taken, I think, a prudent approach on how we take a look at no growth in the first half and then growth resuming in the second half.
Craig Bijou: Thanks, guys.
Peter Arduini: Thank you.
Operator: Thank you. [Operator Instructions] And that will come from the line of Vijay Kumar with Evercore ISI. Your line is open.
Peter Arduini: Hi, Vijay.
Vijay Kumar: Hi, Pete. Congrats on a nice [indiscernible]. Very good morning to you. My first, high level on the guidance here, Pete. 4% organic seems reasonable, given the tougher comps. Curious what is the guide assuming for pricing? And the book-to-bill in Q4, 1.06, it kind of implies that capital book for bill was perhaps 1.08, 1.09. What is the relationship between – when I look at those optical numbers of 1.08, 1.09 capital versus revenues, right? Is there a timing element? Could perhaps 4% – just looking at the book-to-bill, the 4% seems, it looks like it has some cushion.
Jay Saccaro: So maybe I’ll talk first about the sales growth for the year and then talk a little bit about pricing because I think both of those were embedded in the question. Listen, we were very pleased with the performance to close out 2023. On a full year basis, we delivered 8% at the high end of the range, in fact, a little bit in excess of our expectations for the fourth quarter. And a lot of that came down to execution in terms of translating backlog into sales, which was a testament to all the work in many of our teams. And so as we look at 2024, we think roughly 4% is a solid number. If we think about it, we feel really good about 2023. We think the setup is solid. We think the business has proven it’s pretty durable amidst a lot of macroeconomic volatility in 2023.
Our business performed pretty well. And so as a result, we did put on some incremental orders in the fourth quarter in the last couple of months of 2023, which was ahead of our expectations. So as I said. And so it’s early in the year. There is a lot of macro dynamics in play. Pete talked about one, but frankly, it’s a volatile world that we’re living in. And we set the 4% up. It’s a really challenging comp, but it’s set out with a very solid backlog, a solid book-to-bill ratio. And so hopefully, things cooperate and we move through the year nicely. Pete, why don’t you add to that and then we can talk about price?
Peter Arduini: Yes. No, I would just – I think you covered it, Jay, other than the fact to say that, look, we were super pleased with the order book performance. There is been obviously a reasonable amount of questions over this year about order and the translation to revenue, putting up strong orders growth in the fourth quarter, both service and equipment. And again, when you think about our orders book now being over $19 billion, that obviously sets us up for more gas in the tank in – later in Q – in the second half of 2024. But it’s also a business that we have for multiyear deals that gives us visibility into ‘25 as well. And I think that’s an important aspect here. I mentioned $2.5 billion of multiyear enterprise deals, which we’ve been really ramping up our capability on.
