Earning Date, Transcript Summary & Report

Fourth Quarter Sales Growth: Sales in the fourth quarter grew 9% to approximately $12.3 billion, driven by volume growth across the portfolio and higher inventory levels in the market.

Strong Sales Growth: The growth portfolio delivered another strong quarter with sales up 23%, representing slightly more than half of total revenue, with key brands like REBIZEL, Briyansi, Khemzias, and Optilag achieving significant growth.

Eliquis Q4 Sales Surge: Eliquis delivered over $3 billion in fourth quarter sales, with U.S. sales growing 19% due to strong demand and typical inventory build.

Strong Sales Uptake: Cobenphi sales in the fourth quarter were approximately $10 million, reflecting strong prescription uptake during the initial months of launch, with favorable feedback from patients and physicians.

Cost Savings Expansion: The company expects to capture an additional $2 billion in savings from an expanded cost savings program, with approximately $1 billion to be realized in 2025, enhancing financial flexibility for growth investments.

Revenue Guidance Adjustment: Revenue guidance for 2025 is approximately $1,000,000,000 less than consensus, primarily due to expected declines in the legacy portfolio, with a projected 18% to 20% decline due to generics and foreign exchange headwinds.

Legacy Portfolio Decline: The legacy portfolio is expected to decline approximately 10% to 12% sequentially in 2025, reflecting the impact of increased generic competition and the anticipated loss of exclusivity for key products like Revlimid and POMALYST.

Gross Margin Decline: Gross margin declined by approximately 240 basis points in the fourth quarter, driven primarily by product mix, indicating potential pressure on profitability moving forward.

Rising Operating Expenses: Operating expenses increased approximately 8% in the fourth quarter, largely driven by R&D investments, which may limit the company's ability to manage costs effectively in the near term.

Effective Tax Rate Increase: The effective tax rate for the quarter was 19.9%, up from 14.9% in the prior year, primarily driven by earnings mix, which could impact net income and earnings per share going forward.