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.
Will Keytruda Continue to Aid Merck's Top Line in Q1 Earnings?
Read MoreHide Full Article
Key Takeaways
Merck's Keytruda drives over half its pharma sales, with $31.7B in 2025 revenues, up 7% YoY.
Keytruda Q1 2026 sales are likely to have been aided by strong uptake in early and metastatic indications.
Merck expects Keytruda growth through 2028, targeting $35B peak sales before patent exclusivity ends.
A significant share of Merck’s (MRK - Free Report) revenues is derived from the oncology portfolio, led by its blockbuster PD-L1 inhibitor, Keytruda. The drug accounts for more than half of the company’s pharmaceutical sales. Keytruda has been a key driver of Merck’s consistent revenue growth in recent years, generating $31.7 billion in sales in 2025, increasing 7% year over year.
Building on this growing momentum, we expect investors to keep a close eye on Keytruda's sales performance when Merck reports its first-quarter 2026 results on April 30.
Keytruda sales are likely to have gained from rapid uptake across earlier-stage indications. Continued strong momentum in metastatic indications is also likely to boost sales growth in the first quarter. The company expects continued growth from Keytruda, particularly in the early lung cancer indication.
The Zacks Consensus Estimate for Keytruda’s first-quarter sales stands at $7.72 billion.
In 2026, Merck expects Keytruda to grow and expand into new indications and markets globally. Also, the recent FDA approval of Keytruda and Keytruda Qlex (subcutaneous formulation of the drug) for the ovarian cancer indication should contribute to sales growth in 2026. The drug previously had no approved use in this indication.
Importantly, the company expects Keytruda’s strong growth to continue until the drug loses patent exclusivity in 2028. Management expects the drug to achieve peak sales of $35 billion by 2028 before it loses exclusivity.
Merck is also pursuing multiple strategies to support Keytruda’s long-term growth, including innovative immuno-oncology combinations such as pairing Keytruda with LAG-3 and CTLA-4 inhibitors. These efforts are likely to sustain investor interest as the company approaches its upcoming earnings release.
PD-L1 Inhibitors Competing With MRK’s Keytruda
Keytruda faces competition from other PD-L1 inhibitors, including Bristol Myers’(BMY - Free Report) Opdivo, Roche’s (RHHBY - Free Report) Tecentriq and AstraZeneca’s (AZN - Free Report) Imfinzi.
BMY’s Opdivo, like Keytruda, is approved across multiple cancer types, including lung, melanoma and kidney cancers. Bristol Myers recorded $10.05 billion in Opdivo sales in 2025, up 8% year over year.
Tecentriq is Roche’s leading immuno-oncology drug approved for multiple cancer indications. Roche recorded CHF 3.56 billion in Tecentriq sales in 2025, up 3% year over year.
AstraZeneca’s Imfinzi generated sales of $6.06 billion in 2025, up 28%, driven by demand growth in bladder and liver cancer indications. Imfinzi has strategically expanded its use across multiple cancer indications, strengthening AstraZeneca’s oncology portfolio.
MRK's Price Performance, Valuation and Estimates
Year to date, shares of Merck have increased 13.9% against the industry’s decline of 2.8%. The stock has also outperformed the sector and the S&P 500 during the same time frame, as seen in the chart below.
Image Source: Zacks Investment Research
From a valuation standpoint, Merck is trading at a premium compared with the industry. Going by the price/earnings ratio, the company’s shares currently trade at 18.18 forward earnings, higher than 17.08 for the industry and its 5-year mean of 12.66.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2026 earnings per share has decreased from $5.54 to $5.26, while the same for 2027 has declined from $9.98 to $9.90 over the past 60 days.
View the Zacks #1 Rank List
Image: Bigstock
Will Keytruda Continue to Aid Merck's Top Line in Q1 Earnings?
Key Takeaways
A significant share of Merck’s (MRK - Free Report) revenues is derived from the oncology portfolio, led by its blockbuster PD-L1 inhibitor, Keytruda. The drug accounts for more than half of the company’s pharmaceutical sales. Keytruda has been a key driver of Merck’s consistent revenue growth in recent years, generating $31.7 billion in sales in 2025, increasing 7% year over year.
Building on this growing momentum, we expect investors to keep a close eye on Keytruda's sales performance when Merck reports its first-quarter 2026 results on April 30.
Keytruda sales are likely to have gained from rapid uptake across earlier-stage indications. Continued strong momentum in metastatic indications is also likely to boost sales growth in the first quarter. The company expects continued growth from Keytruda, particularly in the early lung cancer indication.
The Zacks Consensus Estimate for Keytruda’s first-quarter sales stands at $7.72 billion.
In 2026, Merck expects Keytruda to grow and expand into new indications and markets globally. Also, the recent FDA approval of Keytruda and Keytruda Qlex (subcutaneous formulation of the drug) for the ovarian cancer indication should contribute to sales growth in 2026. The drug previously had no approved use in this indication.
Importantly, the company expects Keytruda’s strong growth to continue until the drug loses patent exclusivity in 2028. Management expects the drug to achieve peak sales of $35 billion by 2028 before it loses exclusivity.
Merck is also pursuing multiple strategies to support Keytruda’s long-term growth, including innovative immuno-oncology combinations such as pairing Keytruda with LAG-3 and CTLA-4 inhibitors. These efforts are likely to sustain investor interest as the company approaches its upcoming earnings release.
PD-L1 Inhibitors Competing With MRK’s Keytruda
Keytruda faces competition from other PD-L1 inhibitors, including Bristol Myers’(BMY - Free Report) Opdivo, Roche’s (RHHBY - Free Report) Tecentriq and AstraZeneca’s (AZN - Free Report) Imfinzi.
BMY’s Opdivo, like Keytruda, is approved across multiple cancer types, including lung, melanoma and kidney cancers. Bristol Myers recorded $10.05 billion in Opdivo sales in 2025, up 8% year over year.
Tecentriq is Roche’s leading immuno-oncology drug approved for multiple cancer indications. Roche recorded CHF 3.56 billion in Tecentriq sales in 2025, up 3% year over year.
AstraZeneca’s Imfinzi generated sales of $6.06 billion in 2025, up 28%, driven by demand growth in bladder and liver cancer indications. Imfinzi has strategically expanded its use across multiple cancer indications, strengthening AstraZeneca’s oncology portfolio.
MRK's Price Performance, Valuation and Estimates
Year to date, shares of Merck have increased 13.9% against the industry’s decline of 2.8%. The stock has also outperformed the sector and the S&P 500 during the same time frame, as seen in the chart below.
Image Source: Zacks Investment Research
From a valuation standpoint, Merck is trading at a premium compared with the industry. Going by the price/earnings ratio, the company’s shares currently trade at 18.18 forward earnings, higher than 17.08 for the industry and its 5-year mean of 12.66.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2026 earnings per share has decreased from $5.54 to $5.26, while the same for 2027 has declined from $9.98 to $9.90 over the past 60 days.
Image Source: Zacks Investment Research
MRK’s Zacks Rank
Merck currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.