Merck tops Q1 estimates on strong oncology demand; shares rise
📈 Shares of Merck climbed over 4% in premarket trading after Q1 results exceeded analyst expectations.
💰 Revenue reached $16.29 billion, representing a 5% year-over-year increase and beating the consensus forecast of $15.89 billion.
⚠️ The company reported an adjusted loss per share of $1.28, which beat the consensus estimate of a $1.48 loss but included a $3.62 per share charge for the Cidara acquisition.
💊 KEYTRUDA and KEYTRUDA QLEX sales totaled $8.03 billion, rising 12% from a year earlier driven by strong global demand in metastatic treatments.
🚀 WINREVAIR sales jumped 88% to $525 million as the drug saw ongoing uptake in the U.S. and initial international launches.
🐾 Animal Health division delivered strong results with sales increasing 13% to $1.79 billion, supported by demand for vaccines like Gardasil.
💼 CEO Robert M. Davis stated the company is transforming its portfolio with a diversified set of growth drivers across broad therapeutic areas.
📅 For full-year 2026, Merck raised and tightened its revenue outlook to a range of $65.8 billion to $67.0 billion.
💲 Adjusted EPS guidance for 2026 was increased to between $5.04 and $5.16 per share, excluding the upcoming Terns Pharmaceuticals acquisition charge.
📉 Certain specific product lines like Gardasil (-26%), Isentress (-38.5%), and Lagevrio (-72.6%) showed year-over-year declines compared to estimates.
🔬 Oncology sales remained a strong driver, with Reblozyl growing 24.4% and Welireg increasing 45.3% year-over-year.
💊 Virology product Prevymis saw a positive surprise of +30.8% versus analyst estimates despite mixed performance across other viral treatments.
🐂 Cardiovascular drug Winrevair sales reached $525 million, exceeding the consensus estimate and showing double-digit growth from last year.
📉 Merck's stock has underperformed the broader market recently, dropping 8.2% over the past month compared to a 12.2% gain for the S&P 500.
🏦 The Zacks Rank of #3 (Hold) indicates the stock is expected to perform in line with the broader market in the near term.
- Shares of Merck climbed more than 4% in premarket trading after reporting first-quarter results that exceeded analyst expectations for both revenue and EPS.
- Revenue came in at $16.29 billion, beating the consensus forecast of $15.89 billion and marking a 5% year-over-year increase to $16.29 billion compared with $15.53 billion last year.
- Sales of KEYTRUDA and KEYTRUDA QLEX reached $8.03 billion, rising 12% from a year earlier, driven by stronger global demand in metastatic treatments and continued expansion in earlier-stage indications.
- WINREVAIR sales jumped 88% to $525 million, reflecting ongoing uptake in the U.S. and initial international launches.
- The Animal Health division delivered strong results with sales increasing 13% to $1.79 billion, exceeding the analyst average estimate of $1.67 billion.
- Merck raised and tightened its full-year 2026 revenue outlook to a range of $65.8 billion to $67.0 billion, demonstrating management confidence in sustained growth.
- The company increased its adjusted EPS guidance to between $5.04 and $5.16 for 2026, up from the prior range of $5.00 to $5.15.
- Oncology revenue represented a significant upside potential, with Keytruda sales reaching $7.91 billion versus a consensus estimate of $7.73 billion and growing +9.7% year-over-year.
- Several other products beat estimates positively, including Hospital Acute Care- Prevymis at $272 million versus $227.99 million estimated (+30.8% YoY) and Oncology- Reblozyl at $148 million versus $130.56 million estimated (+24.4% YoY).
- Merck's adjusted EPS of -$1.28 beat the consensus estimate of -$1.51 per share, while GAAP revenue grew 4.9% year-over-year to $16.29 billion.
- Merck posted an adjusted quarterly loss of $1.28 per share compared to the prior year's earnings of $2.22 per share, highlighting a significant decline in profitability despite revenue growth.
- The company recorded a $3.62 per share charge related to the acquisition of Cidara Therapeutics included in both adjusted and GAAP results.
- Several key drug sales missed analyst estimates year-over-year, including Gardasil International sales of $585 million versus an average estimate of $619.92 million (-26%), Virology-Isentress at $24 million versus $31.86 million (-38.5%), and Diabetes-Janumet at $139 million versus $129.11 million (missed by analysts despite reported growth).
- Lagevrio sales plummeted to $28 million compared to an average analyst estimate of $61.38 million, representing a severe -72.6% decline year-over-year.
- Shares of Merck have returned -8.2% over the past month while the broader market gained +12.2%, indicating underperformance relative to peers.
- The stock carries a Zacks Rank #3 (Hold), signaling expectations that it could only perform in line with the broader market in the near term.
- Merck raised its full-year 2026 revenue outlook but noted this includes the $3.62 per share Cidara charge and excludes a planned Terns Pharmaceuticals acquisition expected to close in May, which would bring an additional one-time charge of about $2.35 per share.
