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NEW BRUNSWICK, N.J. (

TheStreet

) --

Johnson & Johnson

(JNJ) - Get Johnson & Johnson Report

beat profit expectations in its third quarter, but sales missed expectations, sending shares slipping in morning trading.

While the maker of Band-Aids decided to up its forecast on the better-than-expected results, it achieved this growth predominantly through cost cuts and lower taxes.

During the quarter, the company earned $3.35 billion, or $1.20 a share, compared with $3.31 billion, or $1.17, in the year-ago period. Analysts expected earnings of $1.13 a share.

While Johnson & Johnson did see some strength with its Aveeno skin care products, Splenda sweetener, Listerine mouthwash and the acquisition of Vania Expansion, sales still slipped 5% to $15.1 billion from $15.92 billion, missing analysts' outlook of revenue of $15.19.

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Johnson & Johnson said generic competition slashed sales of several of its top drugs and the recession hurt consumer product sales. Prescription sales tumbled 14% as a result.

But it did see sales in its biggest division, medical devices and diagnostics, rise by 2.3% to $5.84 billion.

Looking ahead, the company now expects to earn between $4.54 and $4.59 a share, up from a prior forecast of $4.45 to $4.55 per share.

Shares of the are slipping 2.7% to $60.87 in early trading.

-- Reported by Jeanine Poggi in New York

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