The Cochlear Ltd (ASX: COH) share price fell to a 52-week low last week, dropping to $261.38 after the company reported its FY25 half-year result.

The ASX healthcare company's half-year result clearly didn't impress the market, as it declined 14% on the day. Ouch.

The business didn't exactly report a terrible set of numbers. The company's HY25 revenue rose by 5% to $1.17 billion, underlying net profit increased 7% to $205.5 million, and statutory net profit increased 7% to $205.1 million. This allowed an 8% hike of the interim dividend per share to $2.15.

However, a number of unfavourable results were reported by the ASX healthcare share.

Negatives from Cochlear's HY25 result

After providing the main numbers the company then made a number of disappointing comments.

The company said it expects its underlying net profit to be between $410 million and $430 million, at the lower end of the guidance range provided in August 2024.

Services growth has slowed since launching the Nucleus 8 sound processor in FY23. It had expected modest service growth in FY25, but it now expects a single-digit decline.

In addition, the company's gross profit margin is expected to be around 74.5%, half a percentage point below its longer-term target of 75% due to lower overhead recoveries at the new facility in Chengdu.

Cochlear also noted that it has been investing in an operating model redesign and core business system upgrades over the past four years to improve efficiency and agility. It expects to invest around $250 million overall, an increase of $100 million from its previous estimate.

Is the Cochlear share price a buy?

After seeing the result, the broker UBS suggested the result was less bad than it looked.

The broker noted that the Cochlear implant unit growth was 6% year over year with stable pricing. The company continues to expect growth of around 10% for FY25, implying an uplift in the second half. It also sees this as a "sustainable forward run rate".

While near-term profit is not expected to be as good, the broker increased its net profit forecasts in the mid-single digits in the long term based on the Cochlear implant sales forecasts.

This helped improve the price target on the Cochlear share price to A$285. A price target is what the broker sees the share price being in 12 months.

However, UBS noted that Cochlear "still faces the prospect of a vaccine against CMV, a major cause of neonatal deafness, developed by Moderna. There is no phase III trial data yet, but it's a risk for the second half. UBS estimates at least 30% of Cochlear's implants in the US are for children at the moment.

Commenting further on the risk of a vaccine, UBS said:

…the case for this to be problematic for Cochlear is weaker than it was because a) the best case scenario efficacy-wise has not materialised for Moderna – the trial could still work but was not stopped early at an interim look and b) the appointment of a new HHS secretary in the US who is notable for his past stance on vaccines. Our prior mid single digit impact to mid term forecasts is tempered in our new forecasts. We still think there is room for downside surprise but a scenario where Moderna's trial fails or efficacy is weak would imply valuation +c.AUD10 all else equal.

UBS currently forecasts that in FY25, Cochlear could generate $2.43 billion of revenue and $415 million of net profit.

It is predicted to make $3 billion in revenue and $549 million in net profit by FY29.