Novartis Reports Strong Q3 Earnings
Novartis achieves strong Q3 earnings, surpassing estimates and raising 2023 guidance, despite stock market declines.
Novartis, a leading Swiss pharmaceutical company, has successfully completed its transition to a pure-play innovative medicines business after the recent spinoff of its generic drugs unit, Sandoz. This strategic move puts a greater emphasis on Novartis' pipeline of innovative medicines and the performance of its top-selling drugs.
In the third quarter, Novartis experienced robust sales from its key drugs, resulting in an impressive profit beat. Sales of Kesimpta, their multiple sclerosis treatment, saw a significant jump of 124%, while Pluvicto, a prostate cancer drug, recorded a sales increase of 217%.
According to FactSet, Novartis' earnings per share stood at $1.74, surpassing analysts' estimates of $1.67. However, net sales of $11.8 billion fell short of the projected $12.4 billion.
Driven by this strong performance, Novartis has raised its 2023 guidance for the third time. They now anticipate a mid- to high-teen growth in core operating income, compared to their previous guidance of "low double-digit to mid-teens" growth. Their initial forecast of high-single-digit growth in net sales remains unchanged.
Despite these positive developments, U.S.-listed shares were down 0.9% before the market opened, and Swiss-listed stocks fell by 0.6% in early European trading.
While Novartis has made a promising start following the spinoff of its generic drugs business, investors may still require further convincing.