We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
MRK Q4 Earnings & Sales Beat Estimates, Stock Down on Weak '26 View
Read MoreHide Full Article
Key Takeaways
MRK posted Q4 adjusted EPS of $2.04 and revenues of $16.40B, beating estimates for both metrics.
MRK's Q4 revenues grew 5% to $16.40B, led by oncology, new drugs and Animal Health segment.
MRK's 2026 outlook falls short of investors' expectations in terms of revenues and earnings.
Merck (MRK - Free Report) reported fourth-quarter 2025 adjusted earnings per share (EPS) of $2.04, which beat the Zacks Consensus Estimate of $2.03. Earnings increased 19% year over year, both on a reported basis and excluding foreign exchange (Fx).
Revenues in the fourth quarter increased 5% year over year on a reported basis and 4% excluding Fx to $16.40 billion. Sales beat the Zacks Consensus Estimate of $16.19 billion.
All sales growth numbers discussed below are on a year-over-year basis and exclude Fx impact.
Keytruda & Other Oncology Drugs Drive MRK’s Q4 Sales
Merck’s flagship product, Keytruda, generated sales of $8.37 billion in the quarter, up 5%. Sales of the drug benefited from rapid uptake across earlier-stage indications and continued strong momentum in metastatic indications. Keytruda sales in the fourth quarter included $35 million in sales of Keytruda Qlex, the subcutaneous formulation of Keytruda.
Keytruda sales beat the Zacks Consensus Estimate of $8.31 billion.
Alliance revenues from Lynparza and Lenvima also aided oncology sales in the fourth quarter. Merck has a deal with British pharma giant AstraZeneca (AZN - Free Report) to co-develop and commercialize PARP inhibitor Lynparza and a similar one with Japan’s Eisai for its tyrosine kinase inhibitor, Lenvima.
Alliance revenues from AZN-partnered Lynparza increased 4% to $389 million in the quarter, driven by higher demand globally. Lenvima alliance revenues totaled $272 million, up 6%.
Welireg recorded sales of $220 million, up 37%. The drug’s sales benefited from higher demand in the United States as well as continued launch uptake in certain European markets.
Sales Performance of MRK's Other Key Products
In vaccines, sales of HPV vaccines — Gardasil and Gardasil 9 — plunged 35% to $1.03 billion due to lower demand in China as well as lower sales in Japan. Gardasil/Gardasil 9 sales narrowly missed the Zacks Consensus Estimate of $1.04 billion.
Proquad, M-M-R II and Varivax vaccines recorded combined sales of $619 million, up 3%.
Merck’s newly launched pneumococcal 21-valent conjugate vaccine, Capvaxive, generated sales worth $279 million compared with $244 million reported in the previous quarter.
In the hospital specialty portfolio, neuromuscular blockade medicine, Bridion injection, generated sales of $499 million in the quarter, up 11%. While the drug’s sales benefited from higher demand in the United States, the gains were offset by generic competition in certain international markets.
In Diabetes, Januvia/Janumet franchise sales rose 3% year over year to $501 million. Sales of the drug were driven by higher net pricing in the United States, offset by lower demand in China and generic competition in most international markets.
New PAH drug Winrevair generated sales of $467 million, up 133% on a year-over-year basis and 29.7% on a sequential basis, reflecting continued strong uptake in the United States.
MRK's Animal Health Segment
The segment generated revenues of $1.51 billion, up 8% year over year on a reported basis and 6% excluding Fx. This growth was driven by higher demand for livestock products. Sales from this segment beat the Zacks Consensus Estimate of $1.48 billion.
Full-Year 2025 Results
Full-year 2025 sales rose 1% (2% ex Fx) to $65.01 billion, surpassing the Zacks Consensus Estimate of $64.80 billion. Pharmaceutical sales grew 1% (1% excluding Fx) to $58.10 billion.
Adjusted earnings for 2025 were $8.98 per share, increasing 17% year over year on a reported basis and 19% excluding Fx. Full-year adjusted earnings beat the Zacks Consensus Estimate of $8.95 per share.
MRK’s 2026 Guidance Fails to Impress Investors
Merck issued a fresh earnings and sales outlook for 2026.
Merck expects revenues to be in the range of $65.5-$67.0 billion in 2026. The forecasted range fell short of the Zacks Consensus Estimate of $67.36 billion.
Adjusted earnings per share are expected to be between $5.00 and $5.15. The Zacks Consensus Estimate for 2026 earnings is currently pegged at $6.20 per share. The guided range also includes a one-time charge of $9 billion or $3.65 per share related to the acquisition of San Diego-based biotech Cidara Therapeutics, which closed last month.
The guidance includes a positive impact from Fx of approximately 1% on sales and around 10 cents on EPS.
The adjusted gross margin is expected to be around 82%.
Adjusted operating expenses are expected to be in the range of $35.9 billion to $36.9 billion. The adjusted tax rate is expected to be approximately 23.5% to 24.5%.
Our Take on MRK’s Results
Merck delivered stronger-than-expected fourth-quarter results, beating estimates for both earnings and sales. The performance was driven by higher sales of oncology drugs such as Keytruda, strong demand in the Animal Health segment, and added contributions from recently launched products like Winrevair.
Despite the encouraging results, investors were left disappointed by the weak 2026 guidance that fell below expectations, resulting in the stock declining in pre-market trading hours on Feb. 3.
In the past six months, shares of Merck have rallied 42.4% compared with the industry’s increase 26.4%.
Image Source: Zacks Investment Research
Keytruda sales were better than expected in the fourth quarter and drove the majority of Merck’s Pharmaceutical revenues. However, the drug is set to lose exclusivity in 2028, which is likely to keep investors worried, given the company’s heavy reliance on it. Declining sales of Gardasil also remain an overhang.
Merck’s late-stage pipeline has almost tripled over the past three years, positioning it to launch several new vaccines and drugs over the next five years, with many having blockbuster potential. To build its long-term portfolio and diversify its product lineup, management is also tapping external sources, including mergers and acquisitions.
Merck & Co., Inc. Price, Consensus and EPS Surprise
Over the past 60 days, estimates for Alkermes’ 2026 earnings per share have increased from $1.54 to $1.91. Shares of ALKS have gained 30.6% over the past six months.
Alkermes’ earnings beat estimates in three of the trailing four quarters, while missing the same on the remaining occasion, with the average surprise being 4.58%.
Over the past 60 days, Castle Biosciences’ loss per share estimates for 2026 have decreased from $1.06 to 50 cents. Shares of CSTL have surged 157.8% over the past six months.
Castle Biosciences’ earnings beat estimates in three of the trailing four quarters, while missing the same on the remaining occasion, with the average surprise being 66.11%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
MRK Q4 Earnings & Sales Beat Estimates, Stock Down on Weak '26 View
Key Takeaways
Merck (MRK - Free Report) reported fourth-quarter 2025 adjusted earnings per share (EPS) of $2.04, which beat the Zacks Consensus Estimate of $2.03. Earnings increased 19% year over year, both on a reported basis and excluding foreign exchange (Fx).
Revenues in the fourth quarter increased 5% year over year on a reported basis and 4% excluding Fx to $16.40 billion. Sales beat the Zacks Consensus Estimate of $16.19 billion.
All sales growth numbers discussed below are on a year-over-year basis and exclude Fx impact.
Keytruda & Other Oncology Drugs Drive MRK’s Q4 Sales
Merck’s flagship product, Keytruda, generated sales of $8.37 billion in the quarter, up 5%. Sales of the drug benefited from rapid uptake across earlier-stage indications and continued strong momentum in metastatic indications. Keytruda sales in the fourth quarter included $35 million in sales of Keytruda Qlex, the subcutaneous formulation of Keytruda.
Keytruda sales beat the Zacks Consensus Estimate of $8.31 billion.
Alliance revenues from Lynparza and Lenvima also aided oncology sales in the fourth quarter. Merck has a deal with British pharma giant AstraZeneca (AZN - Free Report) to co-develop and commercialize PARP inhibitor Lynparza and a similar one with Japan’s Eisai for its tyrosine kinase inhibitor, Lenvima.
Alliance revenues from AZN-partnered Lynparza increased 4% to $389 million in the quarter, driven by higher demand globally. Lenvima alliance revenues totaled $272 million, up 6%.
Welireg recorded sales of $220 million, up 37%. The drug’s sales benefited from higher demand in the United States as well as continued launch uptake in certain European markets.
Sales Performance of MRK's Other Key Products
In vaccines, sales of HPV vaccines — Gardasil and Gardasil 9 — plunged 35% to $1.03 billion due to lower demand in China as well as lower sales in Japan. Gardasil/Gardasil 9 sales narrowly missed the Zacks Consensus Estimate of $1.04 billion.
Proquad, M-M-R II and Varivax vaccines recorded combined sales of $619 million, up 3%.
Merck’s newly launched pneumococcal 21-valent conjugate vaccine, Capvaxive, generated sales worth $279 million compared with $244 million reported in the previous quarter.
In the hospital specialty portfolio, neuromuscular blockade medicine, Bridion injection, generated sales of $499 million in the quarter, up 11%. While the drug’s sales benefited from higher demand in the United States, the gains were offset by generic competition in certain international markets.
In Diabetes, Januvia/Janumet franchise sales rose 3% year over year to $501 million. Sales of the drug were driven by higher net pricing in the United States, offset by lower demand in China and generic competition in most international markets.
New PAH drug Winrevair generated sales of $467 million, up 133% on a year-over-year basis and 29.7% on a sequential basis, reflecting continued strong uptake in the United States.
MRK's Animal Health Segment
The segment generated revenues of $1.51 billion, up 8% year over year on a reported basis and 6% excluding Fx. This growth was driven by higher demand for livestock products. Sales from this segment beat the Zacks Consensus Estimate of $1.48 billion.
Full-Year 2025 Results
Full-year 2025 sales rose 1% (2% ex Fx) to $65.01 billion, surpassing the Zacks Consensus Estimate of $64.80 billion. Pharmaceutical sales grew 1% (1% excluding Fx) to $58.10 billion.
Adjusted earnings for 2025 were $8.98 per share, increasing 17% year over year on a reported basis and 19% excluding Fx. Full-year adjusted earnings beat the Zacks Consensus Estimate of $8.95 per share.
MRK’s 2026 Guidance Fails to Impress Investors
Merck issued a fresh earnings and sales outlook for 2026.
Merck expects revenues to be in the range of $65.5-$67.0 billion in 2026. The forecasted range fell short of the Zacks Consensus Estimate of $67.36 billion.
Adjusted earnings per share are expected to be between $5.00 and $5.15. The Zacks Consensus Estimate for 2026 earnings is currently pegged at $6.20 per share. The guided range also includes a one-time charge of $9 billion or $3.65 per share related to the acquisition of San Diego-based biotech Cidara Therapeutics, which closed last month.
The guidance includes a positive impact from Fx of approximately 1% on sales and around 10 cents on EPS.
The adjusted gross margin is expected to be around 82%.
Adjusted operating expenses are expected to be in the range of $35.9 billion to $36.9 billion. The adjusted tax rate is expected to be approximately 23.5% to 24.5%.
Our Take on MRK’s Results
Merck delivered stronger-than-expected fourth-quarter results, beating estimates for both earnings and sales. The performance was driven by higher sales of oncology drugs such as Keytruda, strong demand in the Animal Health segment, and added contributions from recently launched products like Winrevair.
Despite the encouraging results, investors were left disappointed by the weak 2026 guidance that fell below expectations, resulting in the stock declining in pre-market trading hours on Feb. 3.
In the past six months, shares of Merck have rallied 42.4% compared with the industry’s increase 26.4%.
Image Source: Zacks Investment Research
Keytruda sales were better than expected in the fourth quarter and drove the majority of Merck’s Pharmaceutical revenues. However, the drug is set to lose exclusivity in 2028, which is likely to keep investors worried, given the company’s heavy reliance on it. Declining sales of Gardasil also remain an overhang.
Merck’s late-stage pipeline has almost tripled over the past three years, positioning it to launch several new vaccines and drugs over the next five years, with many having blockbuster potential. To build its long-term portfolio and diversify its product lineup, management is also tapping external sources, including mergers and acquisitions.
Merck & Co., Inc. Price, Consensus and EPS Surprise
Merck & Co., Inc. price-consensus-eps-surprise-chart | Merck & Co., Inc. Quote
MRK's Zacks Rank & Stocks to Consider
Merck currently has a Zacks Rank #4 (Sell).
Some better-ranked stocks in the biotech sector are Alkermes (ALKS - Free Report) and Castle Biosciences (CSTL - Free Report) , both sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here
Over the past 60 days, estimates for Alkermes’ 2026 earnings per share have increased from $1.54 to $1.91. Shares of ALKS have gained 30.6% over the past six months.
Alkermes’ earnings beat estimates in three of the trailing four quarters, while missing the same on the remaining occasion, with the average surprise being 4.58%.
Over the past 60 days, Castle Biosciences’ loss per share estimates for 2026 have decreased from $1.06 to 50 cents. Shares of CSTL have surged 157.8% over the past six months.
Castle Biosciences’ earnings beat estimates in three of the trailing four quarters, while missing the same on the remaining occasion, with the average surprise being 66.11%.