Pfizer Inc. (PFE) Earnings & Analysis

Latest quarter

Pfizer reported Q2 FY2026 revenue of $15.0 billion, above the consensus of $14.4 billion. Adjusted EPS, as the consensus counts it, was $0.77, above the consensus of $0.68. The company’s reported diluted EPS was −$0.04, compared with $0.51 in Q2 FY2025.

Pfizer said revenue increased from $14.7 billion a year earlier, with operational growth led by Eliquis, Padcev, the Vyndaqel family and Lorbrena, while COVID-19 product revenue declined. The filing said Comirnaty revenue fell 34% operationally and Paxlovid revenue fell 95% operationally. Pfizer said revenue excluding Comirnaty and Paxlovid increased 5% operationally.

The company reported gross margin of 72.8%, versus 74.2% a year earlier, and operating margin of 20.4%, versus 25.8%. Pfizer reported free cash flow of $302.0 million, compared with −$1.2 billion in the prior-year quarter. The filing attributed the loss from continuing operations before taxes in part to intangible-asset impairments, legal matters, restructuring charges, acquisition-related costs, R&D expense and cost of sales.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

Cécile Guégan, incoming interim chief financial officer, said Q2 revenue was $15 billion and that revenue excluding COVID products grew 5% operationally. She said the company’s commercial performance helped mitigate the effect of low COVID infection levels, while adjusted diluted EPS of $0.77 reflected non-COVID revenue and cost discipline.

Guégan said the quarter’s portfolio contribution was led by Eliquis, Padcev, the Vyndaqel family and Lorbrena. The filing said Eliquis growth reflected higher U.S. net price, including lower rebates and favorable channel mix, alongside higher global demand; it also cited generic entry and price erosion in some international markets. Pfizer said Vyndaqel-family growth reflected U.S. market expansion, international demand and access, partly offset by U.S. payer-contract price erosion. The filing attributed Padcev growth to market-share gains and launch uptake, while Lorbrena growth reflected increased patient share in the U.S., China and certain other international markets.

On margins and investment, Guégan said adjusted gross margin was 76% in the quarter, citing product mix and cost-control measures. She said adjusted R&D expense increased 12% operationally as Pfizer increased spending on certain oncology and obesity product candidates. The filing said reported R&D expense increased $327 million, primarily driven by higher spending on certain oncology and obesity candidates.

Guégan said Pfizer expected $700 million in Phase 1 manufacturing-optimization savings during 2026 and reported $175 million realized in Q2. Bourla said the company added expected savings from technology and simplification efforts, while the next manufacturing-optimization phase focuses on network structure, product-portfolio changes and operational efficiency.

In the Q&A, Guégan said the increased revenue outlook reflected performance above expectations in the non-COVID portfolio during Q1 and Q2, including momentum in key products, launched products and acquired products. Asked about COVID, Bourla said Paxlovid utilization is correlated with infection rates, whereas vaccination revenue tends to vary less with infection levels. He did not quantify the next year’s COVID season, saying it could be high or low. Bourla also said Pfizer would be strategic with its remaining business-development capacity and identified oncology, immune inflammation, primary care with obesity and vaccines as areas of focus.

Guidance

Pfizer raised its FY2026 revenue guidance to $60.5 billion–$62.5 billion from $59.5 billion–$62.5 billion. Guégan said the revised outlook included approximately $4.0 billion of FY2026 COVID-19 revenue, down from approximately $5 billion previously. Pfizer reaffirmed its FY2026 adjusted diluted EPS guidance of $2.80–$3.00; Guégan said that range absorbs an approximately $0.10 unfavorable impact from the InnoVent Biologics transaction.