Eli Lilly (LLY, Financial) reported lower-than-expected third-quarter profits and revenue, significantly revising its full-year profit forecast. This led to a pre-market stock drop of about 10%. While the company's revenue grew by 20% to $11.44 billion, it fell short of the market's estimate of $12.18 billion. The revenue hike was partly driven by sales of Mounjaro and Zepbound, with a 42% rise excluding olanzapine combination income.
The net profit for the quarter was $970 million, translating to an adjusted earnings per share of $1.18, below analyst expectations of $1.51. Last year, this figure was $0.10. For 2024, the company adjusted its annual revenue prediction to $454-460 billion, previously estimated at $454-466 billion. Adjusted earnings per share are now expected to range from $12.05 to $12.55, down from the earlier forecast of $16.1-$16.6.
Eli Lilly's slimming drugs Mounjaro and Zepbound underperformed, with revenues attributed to reduced wholesale inventory channels. The company has invested billions in expanding production, including a $7 billion investment in Indiana and Ireland facilities. Mounjaro's global revenue was $3.11 billion, up from $1.41 billion last year, while Zepbound earned $1.26 billion, both missing expectations. Analysts had predicted $4.2 billion for Mounjaro and $1.69 billion for Zepbound this quarter, with total sales expected to reach $19 billion this year.
Mizuho Medical expert Jared Holz suggested that Mounjaro's sales might slightly underperform due to more patients opting for the higher-dose benefits of Zepbound. Despite some declaring a peak in Lilly's stock, the complex health care environment suggests investors remain keen on weight-loss stocks.
Eli Lilly's Chair and CEO, David A. Ricks, noted the robust growth with a 42% rise in total revenue after adjusting for last year's divestment activities. The company also achieved a 17% increase in revenues from oncology, immunology, and neuroscience sectors compared to 2023's third quarter. New product approvals and promising pipeline data point to significant future growth.
Furthermore, research progress was made with a 176-week tirzepatide study indicating a 94% reduction in Type 2 diabetes risk for prediabetic or obese adults. Additionally, a 6-month Alzheimer's study, TRAILBLAZER-ALZ 6, demonstrated a reduction in amyloid plaque and a decrease in ARIA-E incidence from 24% to 14% with a modified dosing approach.
