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By Patrick Wingrove (Reuters) -Johnson & Johnson said on Tuesday it plans to separate its orthopedics business into a standalone company named DePuy Synthes within the next 18 to 24 months, marking its second major spinoff in two years as it sharpens focus on higher-growth healthcare segments. J&J also outlined expectations for faster growth into 2026, driven by new drug launches and a strengthened medical devices portfolio, and raised its 2025 sales forecast after reporting quarterly earnings that topped Wall Street expectations. The company said it expects total revenue growth to exceed 5% next year, above current analysts' estimates of 4.6%, and adjusted earnings to top Wall Street estimates of $11.39 per share by as much as 5 cents. J&J's orthopedics unit, which makes hip, knee, and shoulder implants, surgical instruments, and other products, generated around $9.2 billion last year, or about 10% of total revenue.  Post spinoff, the business will be led by industry veteran Namal Nawana, the company said. Shares of the New Jersey-based healthcare company were down 1.2% in early trading. They are up 32% so far this year, compared with a 3% rise in the broader S&P Healthcare Index. Guggenheim analysts said the stock's recent rally could limit any further upside. The company tweaked its 2025 product revenue forecast and now expects $93.5 billion to $93.9 billion, about $300 million higher than its prior view and above analysts' expectations of $93.4 billion, according to LSEG data. RESTRUCTURING BECOMES SPINOFF PLAN J&J in 2023 announced a two-year restructuring program for its orthopedics business, saying it planned to exit certain markets and stop selling some products, after having recently spun off its $15 billion consumer unit into Kenvue.  J.P. Morgan analysts said the orthopedics division represents about 30% of J&J's MedTech segment, generating growth below the rest of the portfolio, and the planned spin-off "should create a faster-growing J&J over time". The company said the move aligns with its focus on high-growth, high-margin areas such as oncology, immunology, neuroscience, surgery, vision care and cardiovascular products. J&J Chief Financial Officer Joe Wolk said the company was exploring multiple paths for the separation, with a primary focus on a tax-free spinoff, but remained open to other options. While the orthopedics business was profitable, Wolk said J&J believes the next phase of innovation in orthopedics was "beyond our scope and probably in better hands somewhere else." Wolk, on a call with investors and analysts, said the separation process was already underway, but the company does not expect further material updates on the transaction until mid-2026. Brian Mulberry, portfolio manager at Zacks Investment Management, which owns J&J shares, said there are some valid concerns around spinning off the orthopedics division. "It's roughly 10% of revenue generation and it is a fairly large strategic pivot to make," he said, adding that J&J stock might also be down on revived worries around trade and tariffs with China impacting the market broadly. SLIGHT PROFIT, SALES BEAT Third-quarter sales of $23.99 billion edged past Wall Street expectations of $23.75 billion, according to LSEG data. The drugs and medical device maker posted adjusted earnings of $2.80 per share, topping analysts' expectations by 4 cents. The company's pharmaceuticals sales jumped 6.8% from a year ago to $15.56 billion, slightly outpacing analysts' estimates of $15.42 billion.  Blood cancer treatment Darzalex brought in third-quarter sales of $3.67 billion, about in line with forecasts of $3.62 billion. Its medical device sales also rose 6.8% to $8.43 billion, mainly driven by electrophysiology products.  J.P. Morgan analysts said J&J remains "one of the cleaner stories" among large healthcare companies as it moves past the loss of exclusivity for its blockbuster drug Stelara and benefits from steady growth across its core portfolio. Separately, CEO Joaquin Duato declined to comment on reports that the company was in talks to acquire Protagonist Therapeutics. J&J already "owns the majority of the value" of the biotech's main asset through a 2017 global licensing deal, he told CNBC. "We have a great working relationship with Protagonist, and we are very happy with that arrangement." (Reporting by Patrick Wingrove in New York and Mrinalika Roy in Bengaluru; Editing by Bill Berkrot)

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By Katha Kalia (Reuters) -Rayonier and PotlatchDeltic said on Tuesday they will merge in an all-stock deal worth about $8.2 billion, including debt, to create one of North America's largest publicly traded timber and wood products companies. The merger comes as lumber markets remain volatile, whipsawed by shifting tariffs and a weak construction outlook. Prices have swung sharply this year, pressured by a cooling housing sector but recently lifted by new U.S. tariffs on softwood lumber and production cuts at North American sawmills. The combined company will own about 4.2 million acres of timberland across 11 U.S. states and operate seven wood manufacturing plants, giving it greater scale and reach. Most of the merged firm's acreage will be in the U.S. South, a region with a large softwood capacity. PotlatchDeltic's wood products platform will position the new company to benefit from a ramp-up in U.S. lumber production due to higher duties on Canadian imports and new tariffs, Rayonier CEO Mark McHugh said on a conference call. RBC Capital Markets analyst Matthew McKellar said the deal was "moderately positive," citing its scale, diversification and synergy potential, but noted Rayonier's limited experience in wood products manufacturing. Rayonier provides sustainable forest management, land management, timber products, and real estate services. Under the deal, PotlatchDeltic shareholders will get 1.7339 Rayonier shares per share, valuing PotlatchDeltic at $44.11 each. This values PotlatchDeltic at $3.41 billion, according to Reuters calculation. Rayonier shares slipped 1%, while PotlatchDeltic rose 3.6% in morning trading. The per-share value, also represents a premium of 8.25% to PotlatchDeltic's closing stock price on October 10, the last business day prior to execution of the deal, the companies said. Rayonier shareholders will own about 54% of the combined company and PotlatchDeltic investors 46%. The deal is expected to close by mid-2026. Rayonier CEO Mark McHugh will lead the new firm, with PotlatchDeltic's Eric Cremers serving as executive chair for two years. The headquarters will be in Atlanta, with regional offices in Spokane, Washington, and Wildlight, Florida. (Reporting by Katha Kalia and Arunima Kumar in Bengaluru; Editing by Leroy Leo and Saumyadeb Chakrabarty)

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By Heekyong Yang and Hyunjoo Jin SEOUL (Reuters) -Samsung Electronics on Tuesday said it expects its biggest quarterly profit in over three years, as the global race to boost production of AI chips has tightened supply and driven up prices of conventional memory chips, the tech giant's mainstay. Strong demand for conventional memory chips used in data centre servers helped offset weaker sales of advanced artificial intelligence chips of Samsung, which has been lagging rivals in the race to supply to Nvidia, analysts said. The world's leading memory chipmaker estimated an operating profit of 12.1 trillion won ($8.5 billion) for the July-September period, up 32% from a year earlier and well above a 10.1 trillion won LSEG SmartEstimate. That would mark its best quarterly profit in 13 quarters. Samsung shares slipped 0.5% as of 0302 GMT after rising as much as 2.9% earlier to their highest level since January 2021. Analysts attributed the decline to profit-taking following the rally. The stock has risen about 75% this year. "The third-quarter earnings surprise came from the chip business," said Ryu Young-ho, a senior analyst at NH Investment & Securities. Strong demand for conventional memory to support general-purpose servers, combined with robust HBM demand for AI servers, have together fuelled overall memory demand, he said. Although progress in supplying advanced high bandwidth memory (HBM) chips to major clients such as Nvidia was slower than expected, gains in commodity memory, supported by tight supplies, helped cushion the impact, analysts said. "Samsung is a big beneficiary of growing demand for commodity chips," said Sohn In-joon, an analyst at Heungkuk Securities. Sohn attributed the earnings beat to stronger-than-expected prices of commodity DRAM and NAND chips, stemming from demand for data centre servers, and lower chip inventory by chipmakers that gave them bargaining power in pricing. Analysts said Samsung also benefited from narrower losses at its foundry unit, which makes logic chips, as utilisation rates helped ease fixed-cost pressures. The company said revenue would likely rise 8.7% to a record high of 86 trillion won from a year earlier, also helped by the weaker South Korean currency. Samsung is expected to release detailed results including a breakdown of earnings for each of its businesses on October 30. Expanding on its stock incentives for senior executives, the company has decided to launch a performance-linked stock compensation plan for all employees in South Korea over the next three years, according to an internal memo dated October 14, seen by Reuters. Samsung declined to comment on the plan. SHORTAGE STOKES CONVENTIONAL CHIP PRICES Analysts said memory makers' focus on investing in advanced chips in recent years may have limited the production of conventional chips, which extended a supply shortage and spurred price increases for conventional chips. Prices of some DRAM chips, widely used in servers, smartphones and PCs, jumped 171.8% in the third quarter from a year earlier, according to TrendForce data. Analysts expect the commodity memory supply shortage to continue into 2026, with big tech companies expanding their spending on AI-related investments, including data centres and servers capable of handling the growing workloads from AI services. While recent chip supply deals with major tech companies, such as Tesla and OpenAI, eased investor concerns about Samsung, analysts cautioned that uncertainties remain that could hurt Samsung's consumer products, including potential U.S. tariffs, an intensifying trade war between the U.S. and China, as well as China's tightened export controls on rare earth materials used in advanced chips and manufacturing equipment. Samsung has been the world's biggest memory chipmaker for three decades but it is facing increasing competition in advanced AI chips after losing its No. 1 DRAM market share to SK Hynix in the first quarter of this year. Analysts expect Samsung’s HBM sales to gradually improve after the company made meaningful progress in supplying its latest 12-layer HBM3E chips to Nvidia, though some said shipment volumes remain limited. Samsung is betting on next-generation HBM4 products to narrow the gap with SK Hynix. Morgan Stanley said in a report that Samsung is on track with next-generation HBM4 development, working closely with major U.S. customers. Commercial shipments and sales contributions are expected to begin in 2026. ($1 = 1,427.1000 won) (Reporting by Heekyong Yang, Hyunjoo Jin and Joyce Lee; Editing by Chris Reese and Sonali Paul)

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