Merck & Co. reported fourth‑quarter 2025 results that surpassed expectations, with revenue of $16.4 billion—up 5% year‑over‑year—and adjusted earnings per share of $2.04, beating consensus estimates of $2.01–$2.03 by $0.01–$0.03. The company’s pharmaceutical segment generated $14.84 billion in sales, a 6% increase, while the animal‑health division added 8% year‑over‑year revenue. Keytruda sales rose 7% to $8.37 billion, and the new launch WINREVAIR delivered $467 million in sales, a 133% jump from the prior year.
The strong earnings beat was driven by a mix of high‑margin oncology and cardiometabolic growth and disciplined cost management. Keytruda’s continued uptake in both early‑stage and metastatic indications provided a solid revenue base, while WINREVAIR’s rapid adoption in respiratory markets added a new high‑growth engine. The animal‑health segment’s 8% growth reflects expanding demand for veterinary products and a favorable currency environment.
Merck’s non‑GAAP gross margin expanded to approximately 82% in Q4 2025, up from about 79.7% in the prior year, reflecting pricing power in its core therapeutic areas and a favorable product mix. Operating cash flow for the quarter was strong, supporting ongoing R&D investment and shareholder returns, though the exact figure was not disclosed in the fact‑check sources.
Full‑year 2025 guidance was revised to revenue of $65.5 billion to $67 billion and adjusted EPS of $5.00 to $5.15, both below analyst consensus of $67.6 billion and $5.36, respectively. Management cited a $9 billion one‑time charge related to the Cidara Therapeutics acquisition and the looming patent expirations for Januvia, Janumet, and Bridion as key factors limiting growth. The guidance signals a cautious outlook amid expected revenue erosion from patent cliffs and the integration costs of recent acquisitions.
Rob Davis, Chairman and CEO, said, “Our Q4 results demonstrate the strength of our portfolio and the effectiveness of our cost‑control initiatives. While we remain confident in our long‑term growth strategy, we are mindful of the upcoming patent expirations and the need to accelerate new product launches to sustain momentum.”
Investors reacted negatively to the conservative 2026 outlook, with the market focusing on the lower revenue and EPS guidance and the impact of patent expirations on future profitability.
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