Johnson & Johnson's (JNJ) chief financial officer on Tuesday said the company is considering alternatives to its planned acquisition of troubled heart device maker Guidant Corp. as the health care company posted a 12 percent jump in third-quarter profit amid strong overseas sales.

The acquisition, originally set to close in September, has been in question because of Guidant's repeated recalls of pacemakers and defibrillators.

The comments by J&J CFO Robert J. Daretta were the first public indication that the $25.4 billion deal may be in trouble, rather than just delayed. Shares of Indianapolis-based Guidant (GDT) plunged $7.63, or 10.5 percent, to $64.75 on the New York Stock Exchange (search), while J&J shares rose 60 cents to $63.60.

"As it relates to the previously announced product recalls at Guidant and the related regulatory investigations and other developments, we believe that these are serious matters," Daretta told analysts during a morning conference call. "In light of these matters and their impact, we are continuing to consider the alternatives under our merger agreement."

Daretta said J&J still expects a key regulatory approval, by the Federal Trade Commission (search), later this month, but he declined to answer any questions on the deal.

Guidant officials didn't immediately respond to a call seeking comment.

Since June, Guidant has recalled or issued warnings about 88,000 heart defibrillators (search) — including its top seller, the Contak Renewal 3 (search) — and almost 200,000 pacemakers because of reported malfunctions. The company is under fire for waiting years to alert doctors and patients about possible flaws in some products.

Meanwhile, J&J reported its third-quarter net income grew to $2.63 billion, or 87 cents per share, for the July-September period from $2.34 billion, or 78 cents per share, a year ago. The maker of contraceptives, contact lenses, prescription drugs and baby- and skin-care products said revenue rose 7 percent, to $12.31 billion from $11.55 billion last year.

Analysts surveyed by Thomson Financial expected earnings per share of 86 cents on revenue of $12.51 billion.

Daretta raised the company's earnings target for the full year to $3.48 to $3.50 per share, from a prior forecast of $3.44 to $3.47.

Results were buoyed by the growth in the company's medical devices segment, which posted a 14.3 percent rise in revenue to $4.6 billion on strong sales of its Cypher drug-coated heart stent, the market leader. Stents are tiny wire mesh tubes that are expanded inside plaque-congested arteries to prop them open. The drug coating helps prevent reclogging by keeping tissue from growing through the mesh.

Nearly all J&J's revenue growth came from foreign sales, which jumped 12.2 percent to $5.34 billion, versus a 2.6 percent increase in U.S. sales, to $6.97 billion.

The consumer products segment posted a 10.2 increase in total revenues, to $2.23 billion, driven by sales of artificial sweetener Splenda and skin care lines RoC and Neutrogena.

Prescription drug sales were flat at $5.46 billion as U.S. sales dipped 4.5 percent. Reasons included continued loss of market share for anemia drug Procrit, which has fallen to J&J's No. 2 seller amid intense competition, and lower sales of hormonal contraceptives. The segment also saw big drops in sales of three drugs with recent generic competition — chronic pain patch Duragesic, painkiller Ultracet and antifungal drug Sporanox.

Investor relations head Helen Short noted "a significant decline" in sales of heart failure drug Natrecor amid media reports the costly drug, primarily for critical care hospital patients, is being used too much on outpatients; she said 95 percent of sales are to hospitals.

For the first nine months, J&J reported net income rose 13 percent, to $8.23 billion, or $2.73 per share, on revenues of $37.9 billion.