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Sep 30, 2024
Merck Q3 2024 Earnings Report
Merck's third-quarter results were strong, driven by KEYTRUDA, new launches, and Animal Health business, but partially offset by lower sales of JANUVIA, JANUMET, GARDASIL/GARDASIL 9, and LAGEVRIO.
Key Takeaways
Merck reported a 4% increase in worldwide sales, reaching $16.7 billion in Q3 2024. GAAP EPS was $1.24, and non-GAAP EPS was $1.57. The results were driven by KEYTRUDA, new product launches like WINREVAIR, and strong growth in Animal Health, offset by declines in other products.
Total worldwide sales reached $16.7 billion, a 4% increase compared to Q3 2023.
GAAP EPS was $1.24, while non-GAAP EPS was $1.57.
Sales growth was driven by KEYTRUDA, new launches including WINREVAIR, and Merck’s Animal Health business.
Growth was partially offset by lower sales of JANUVIA and JANUMET, lower combined sales of GARDASIL/GARDASIL 9 and lower sales of LAGEVRIO.
Merck
Merck
Forward Guidance
Merck narrowed the range of its full-year sales outlook. Merck now expects its full-year sales to be between $63.6 billion and $64.1 billion, including a negative impact of foreign exchange of approximately 3 percentage points, at mid-October 2024 exchange rates. Merck now expects its full-year non-GAAP effective income tax rate to be between 16.0% and 17.0%, which includes an unfavorable impact related to the one-time charge associated with the acquisition of CN201 (MK-1045) from Curon. Merck now expects its full-year non-GAAP EPS to be between $7.72 and $7.77.
Positive Outlook
- Full-year sales expected to be between $63.6 billion and $64.1 billion.
- Strong growth, including from KEYTRUDA, new product launches and Animal Health is expected
- Approximately 2 percentage points of the negative impact of foreign exchange is due to the devaluation of the Argentine peso, which is being largely offset by inflation-related price increases, consistent with practice in that market.
- Full-year non-GAAP effective income tax rate to be between 16.0% and 17.0%.
- Full-year non-GAAP EPS to be between $7.72 and $7.77.
Challenges Ahead
- Includes a negative impact of foreign exchange of approximately 3 percentage points.
- Includes an unfavorable impact related to the one-time charge associated with the acquisition of CN201 (MK-1045) from Curon.
- The outlook includes a negative impact of foreign exchange of approximately $0.30 per share.
- Non-GAAP EPS excludes acquisition- and divestiture-related costs, costs related to restructuring programs, income and losses from investments in equity securities, as well as a tax benefit in 2024 due to a reduction in reserves for unrecognized income tax benefits, resulting from the expiration of the statute of limitations for assessments related to the 2019 federal tax return year.
- Financial outlook does not assume additional significant potential business development transactions.