Eli Lilly and Co LLY stock is trading lower after the company released first-quarter earnings and lowered 2025 guidance.
The U.S. pharma giant reported first-quarter revenue of $12.73 billion, up 45% year over year, almost in line with the consensus of $12.67 billion, driven by a 53% increase in volume, partially offset by a 6% decrease due to lower realized prices and a 2% unfavorable impact of foreign exchange rates.
Key Products revenue grew by $4.09 billion to $7.52 billion in Q1 2025, led by Mounjaro and Zepbound.
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Revenue in the U.S. increased 49% to $8.49 billion, driven by a 57% increase in volume, partially offset by a 7% decrease due to lower realized prices. Zepbound and Mounjaro drove the increase in U.S. volume.
Revenue outside the U.S. increased 38% to $4.24 billion, driven by a 46% increase in volume.
The volume increase outside the U.S. was driven primarily by Mounjaro and, to a lesser extent, Jardiance.
The company reported an adjusted EPS of $3.34, compared to $2.58 from a year ago, beating the consensus of $3.02.
Mounjaro sales jumped 113% to $3.84 billion. U.S. revenue was $2.66 billion, an increase of 75%, reflecting continued strong demand, partially offset by lower realized prices.
Revenue outside the U.S. increased to $1.19 billion compared with $286.2 million in Q1 2024, primarily driven by volume growth, including entry into new markets, partially offset by lower realized prices.
Sales of Verzenio (a breast cancer drug) increased 10% to $1.16 billion. U.S. revenue was $657.6 million, a 3% increase driven by higher realized prices. Increased demand was more than offset by wholesaler buying patterns and competitive dynamics.
Revenue outside the U.S. was $501.3 million, an increase of 22%, primarily driven by volume growth, partially offset by the unfavorable impact of foreign exchange rates.
Zepbound sales reached $2.31 billion, surging from $517.4 million a year ago, driven by demand growth despite pricing pressures.
Guidance: Eli Lilly reaffirms fiscal year 2025 sales of $58 billion—$61 billion versus a consensus of $59.52 billion and $45.04 billion in 2024.
Eli Lilly lowers the 2025 adjusted EPS outlook from $22.50-$24.00 to $20.78-$22.28 compared to the consensus of $21.93 to reflect the impact of the Q1 2025 acquired IPR&D.
In Q1 2025, the company recognized acquired in-process research and development (IPR&D) charges of $1.57 billion compared with $110.5 million in Q1 2024, primarily related to acquiring Scorpion Therapeutics, Inc.’s STX-478 program.
In January, Eli Lilly agreed to acquire Scorpion Therapeutics’ PI3Kα inhibitor program STX-478.
STX-478 is a once-daily oral, mutant-selective PI3Kα inhibitor currently being evaluated in a Phase 1/2 clinical trial for breast cancer and other advanced solid tumors.
Under the terms of the agreement, Lilly will acquire Scorpion, and Scorpion shareholders could receive up to $2.5 billion in cash. Up to $1 billion will be paid upfront, with an additional $1.5 billion contingent on meeting specific performance milestones.
Eli Lilly added that the guidance includes the existing tariff and trade environment and does not reflect any policy shifts, including pharmaceutical sector tariffs, that could impact business.
In an interview with CNBC, Eli Lilly CEO Dave Ricks said, “I think that actually the threat of tariffs is already bringing back critical supply chains into important industries, chips and pharma.”
“So do we need to enact [tariffs?] I’m not so sure,” Ricks said.
Price Action: At last check on Thursday, LLY stock was down 6.91% to 837.26.
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