Eli Lilly and Company has recently made headlines by exceeding expectations with its quarterly earnings, revealing a robust outlook bolstered by skyrocketing sales of its weight loss medication Zepbound and diabetes treatment Mounjaro.
On Wednesday, the pharmaceutical powerhouse disclosed its fourth-quarter earnings and revenue figures, along with projections for 2026 that surpassed analysts' predictions. The company is forecasting that its revenue for 2026 will fall within the range of $80 billion to $83 billion, a significant leap compared to the anticipated $77.62 billion according to estimates from LSEG.
In addition, Lilly expects its adjusted earnings to be in the ballpark of $33.50 to $35 per share for the coming year, which is slightly above the analysts' average estimate of $33.23 per share, as reported by LSEG.
This positive news comes on the heels of a warning from competitor Novo Nordisk, which indicated on Tuesday that it anticipates declines in both sales and profit this year due to falling prices in the United States and the expiration of exclusivity for its leading obesity and diabetes medications in markets such as China, Brazil, and Canada.
Eli Lilly aims to solidify its standing in the rapidly expanding GLP-1 drug market at a time when Novo Nordisk is gearing up for a major launch of its Wegovy pill for obesity in the U.S. Moreover, Lilly is looking forward to gaining approval for its own oral weight loss treatment, orforglipron, later this year.
Here’s a breakdown of the fourth-quarter results as compared to Wall Street expectations, based on an analyst survey conducted by LSEG:
- Earnings per share: $7.54 adjusted vs. $6.67 expected
- Revenue: $19.29 billion vs. $17.96 billion expected
Eli Lilly's fourth-quarter revenue reached an impressive $19.29 billion, reflecting a remarkable 43% increase from the same quarter last year.
In the United States alone, revenue surged to $12.9 billion, largely attributed to a 50% rise in volume—essentially the number of prescriptions or units sold—primarily driven by Mounjaro and Zepbound. However, this growth was somewhat tempered by lower effective prices for these medications.
For the fourth quarter, the company reported a net income of $6.64 billion, translating to $7.39 per share, in contrast to the previous year's net income of $4.41 billion, or $4.88 per share.
When excluding unusual items related to intangible asset valuations and other adjustments, Eli Lilly achieved earnings of $7.54 per share for the fourth quarter.
In a significant development last November, both Novo and Lilly entered into groundbreaking agreements with President Donald Trump to reduce the prices of their leading obesity and diabetes medications. While these price cuts are expected to eventually lead to an increase in prescriptions, they may also impact total sales negatively.
Under these arrangements, Lilly and Novo have pledged to lower the costs of these treatments for Medicare and Medicaid beneficiaries starting in 2026 and to provide them directly to consumers at discounted rates through the soon-to-launch direct-to-consumer initiative, TrumpRx. Additionally, both companies will benefit from a three-year tariff exemption.
In an exclusive conversation with CNBC last Friday, Lilly CEO Dave Ricks acknowledged that the new drug pricing agreement would result in "a step down in pricing" early this year. However, he expressed optimism that the volume growth of the company’s products will accelerate in the latter half of the year.
