Pfizer (PFE.US) eases profit pressure: Strong demand for legacy drugs in Q2 drives 2026 revenue guidance upward, with an additional $2.5 billion in cost reductions

According to Zhitong Finance APP, before the US stock market opened on Tuesday, Pfizer (PFE.US) released its financial results for the second quarter of 2026. Against the backdrop of a continuous decline in Covid-19 product revenues, the company achieved revenue growth exceeding expectations thanks to the strong performance of core non-Covid products such as Eliquis and Padcev, and raised the lower end of its full-year revenue guidance. However, a $4.3 billion non-cash impairment of intangible assets dragged GAAP net income into the red, resulting in a net loss, with the share price rising about 0.52% in pre-market trading to $25.16.

Key Data: Non-Covid Products Grow 18% Against the Trend, Eliquis Surpasses Expectations

In the second quarter, Pfizer achieved revenue of $15.03 billion, a year-on-year increase of 3%, far exceeding the market expectation of $14.41 billion. Adjusted earnings per share were $0.77, also significantly above analysts' forecasts of $0.68.

However, under GAAP, the company recorded a net loss of $248 million, or a loss of $0.04 per share, compared to net income of $2.91 billion in the same period last year. The loss was mainly due to a $4.3 billion non-cash impairment of intangible assets.

Non-Covid products were the core highlight of this financial report. Excluding Comirnaty and Paxlovid, Pfizer's operational revenue grew by 5%; the portfolio of marketed and acquired products grew by 18%. Among them, sales of the blood thinner Eliquis reached $2.43 billion, up 19% year-on-year, far surpassing analysts' expectations of $2.08 billion. Padcev's operational growth was 23%, Lorbrena grew 37%, and the Vyndaqel family grew 8%. The strong performance of marketed and acquired products added about $1.5 billion upside to the full-year guidance.

Covid-19 products continued to drag on performance. Paxlovid plummeted 95% in operational revenue, while Comirnaty dropped 34%. Pfizer lowered its full-year Covid-19 product revenue outlook from about $5 billion previously to about $4 billion.

Full-Year Guidance: Raises Revenue Lower Bound, Maintains Profit Outlook

Based on the better-than-expected performance of non-Covid products, Pfizer raised its 2026 full-year revenue guidance from the previous $59.5–62.5 billion to $60.5–62.5 billion. The midpoint of the new guidance is $500 million higher than before.

The company also reiterated its adjusted full-year earnings per share guidance of $2.80 to $3.00, roughly in line with market expectations of $2.95. This guidance already includes a negative impact of about $0.10 from the Innovent Biologics transaction.

Cost Cuts Increased: Additional $2.5 Billion Savings for 2027-2029

Pfizer announced an expansion of its cost reduction program, expecting to achieve an additional $2.5 billion in net cost savings between 2027 and 2029. Of this, $1 billion comes from ongoing cost adjustment plans and $1.5 billion from the next phase of manufacturing optimization.

Added to the previously announced $5.7 billion savings target, Pfizer’s total net cost savings are expected to reach about $6.7 billion by 2029. The company stated that as of August 4, there was $3.3 billion remaining in its share repurchase authorization, but no share buybacks are expected in 2026.

CFO Change

Pfizer CEO Albert Bourla said in the earnings statement: "Pfizer delivered another strong quarter, delivering on our financial commitments and advancing our strategy. The performance of marketed and acquired products has been strong, the obesity program is advancing with meaningful momentum, and our oncology portfolio remains a core strength."

However, market doubts over Pfizer's R&D pipeline remain unresolved. In June, an experimental antibody-drug conjugate failed to improve survival in patients with late-stage lung cancer. The drug was one of the main assets acquired through Pfizer's $43 billion purchase of Seagen at the end of 2023. BMO Capital Markets analysts pointed out that ongoing questions about the value of the Seagen acquisition indicate that Pfizer “still needs to further clarify the scope and timing of its oncology business opportunities.”

Meanwhile, Pfizer is undergoing a major change in its financial leadership. CFO Dave Denton will leave the company on August 15 to join Nike. Veteran finance executive Cecile Guegan, who has served the company for over 20 years, will become interim CFO the following day. The company is conducting an internal and external search for a permanent successor.

Pfizer expects to resume strong growth after the expiration of key patents in 2028. Bourla stated on the conference call that the company’s “marketed and acquired products are performing well... our obesity program is steadily advancing.” However, with a patent cliff approaching, Covid-19 revenues continuing to shrink, and key late-stage pipeline data still uncertain, whether this pharmaceutical giant can maintain its hard-won growth momentum throughout the remainder of 2026 remains a key focus for the market.