Merck & Co. reported first‑quarter 2026 revenue of $16.29 billion, a 5 % year‑over‑year increase that exceeded the consensus estimate of $15.91 billion. The lift was driven by a 12 % rise in Keytruda sales to $8.0 billion and an 88 % jump in Winrevair revenue to $525 million, offsetting a 19 % decline in Gardasil sales.
The company posted a GAAP net loss of $4.24 billion, or $1.72 per share, largely because of a $9.0 billion charge related to the acquisition of Cidara Therapeutics, which translates to a $3.62 per‑share impact. Non‑GAAP loss per share was $1.28, slightly better than the $1.31 estimate.
Non‑GAAP gross margin fell to 81.9 % from 82.2 % in the same quarter a year earlier, a modest compression attributed to the one‑time acquisition costs and a slight shift in product mix.
Management raised its full‑year 2026 outlook to worldwide sales of $65.8 billion to $67.0 billion, up from the previous $65.5 billion to $67.0 billion range, and adjusted earnings per share to $5.04 to $5.16, an increase from the prior $5.00 to $5.15 range. The upward revision of the lower end signals confidence in continued demand for the company’s oncology and animal‑health products.
Merck acknowledged a $2.5 billion headwind from generic competition and Inflation Reduction Act pricing pressures, but emphasized that its science‑led business‑development strategy is accelerating pipeline growth. CEO Robert M. Davis said, “We are moving with speed to transform our portfolio to one with a diversified set of growth drivers across a broad set of therapeutic areas.” He added, “During the first quarter, we continued to strengthen our pipeline with science‑led business development, including our planned acquisition of Terns.”
Investors reacted positively to the earnings beat and the raised guidance, with analysts noting the company’s ability to maintain revenue growth while managing the impact of the Cidara acquisition.
The company also highlighted recent milestones, including the FDA approval of IDVYNSO for HIV treatment and the launch of CD388, a long‑acting antiviral for influenza prevention, underscoring its commitment to expanding its pipeline beyond Keytruda.
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