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Core Insights - Gilead Sciences reported quarterly earnings of $2.01 per share, exceeding the Zacks Consensus Estimate of $1.95 per share, with an earnings surprise of +3.08% [1] - The company generated revenues of $7.08 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.95% and showing a year-over-year increase from $6.95 billion [2] - Gilead's stock has increased by approximately 19.4% year-to-date, outperforming the S&P 500's gain of 7.9% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $2.16, with expected revenues of $7.45 billion, and for the current fiscal year, the EPS estimate is $8.02 on revenues of $28.68 billion [7] - The estimate revisions trend for Gilead was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Medical - Biomedical and Genetics industry, to which Gilead belongs, is currently ranked in the top 41% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Data and Key Metrics Changes - The company reported base business sales of $6.9 billion, growing 4% year over year, driven by strong performance in HIV products [6][41] - Total product sales reached $7.1 billion, reflecting a 2% year-over-year increase, partially offset by a 44% decline in Vecluri sales due to fewer COVID-19 related hospitalizations [6][41] - Non-GAAP diluted EPS for the quarter was $2.01, with a product gross margin of 87% [42][41] Business Line Data and Key Metrics Changes - HIV sales amounted to $5.1 billion, representing a 7% year-over-year growth, with Biktarvy and Descovy contributing significantly [14][41] - Biktarvy sales grew 9% year over year to $3.5 billion, while Descovy saw a remarkable 35% increase to $653 million [14][16] - Trodelvy sales reached $364 million, up 14% year over year, reflecting strong demand in metastatic breast cancer [24][41] Market Data and Key Metrics Changes - The U.S. PrEP market has expanded to over 5 million active users, growing in the mid-teens year over year [17][20] - Descovy's market share for PrEP grew to over 40% in the U.S., with unrestricted access covering 88% of total lives [17][66] - The company anticipates a 3% growth in HIV sales for 2025, up from previous expectations of flat revenue [20][21] Company Strategy and Development Direction - The company is focused on expanding its HIV product portfolio, with plans for up to eight additional product launches by 2033 [32] - The recent FDA approval of lenacapavir (YES2Go) is seen as a transformative step in HIV prevention, with a strong commercial launch strategy in place [5][18] - The company aims to enhance its oncology pipeline, particularly with Trodelvy, which is expected to advance into first-line treatment settings [10][36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong performance of the HIV portfolio and the potential of lenacapavir to significantly impact the HIV epidemic [8][20] - The company is closely monitoring the macroeconomic landscape and is prepared to adapt its strategies as needed [47] - Management highlighted the importance of maintaining operational discipline while pursuing growth opportunities [48] Other Important Information - The company returned $1.5 billion to shareholders in the second quarter, including $527 million in share repurchases [48] - A new $6 billion share repurchase program has been approved to support continued buybacks [48] Q&A Session Summary Question: Can you elaborate on the early uptake with YES2Go? - Management reported strong early uptake with over 25,000 customer calls executed, indicating high awareness and readiness for the launch [51][56] Question: How durable is the growth rate for Descovy? - Management noted that the PrEP market is growing at about 15% year over year, with Descovy's performance driven by favorable access and reduced co-pays [63][66] Question: What is the potential impact of the MFN proposal on Gilead's business? - Management acknowledged ongoing discussions regarding the MFN proposal and emphasized the importance of maintaining patient access to medications [71][72] Question: How would changes in the USPSTF guidelines affect commercialization? - Management expressed confidence that even if guidelines change, the company could still ensure access to HIV prevention through strong payer relationships [80][82] Question: What updates should be expected regarding the WONDERS program? - Management indicated that updates on the WONDERS program would be forthcoming, particularly following the resolution of the clinical hold [85]

Financial Data and Key Metrics Changes - The company reported base business sales of $6.9 billion, a 4% year-over-year increase, driven by growth in Biktarvy, Descovy, Libdelzi, and Trodelvy [6][42] - Total product sales reached $7.1 billion, reflecting a 2% year-over-year growth, with a notable decline in Vecluri sales by 44% due to fewer COVID-19 related hospitalizations [6][42] - Non-GAAP diluted EPS for the quarter was $2.01, with an operating margin of 46% [42][44] Business Line Data and Key Metrics Changes - HIV sales amounted to $5.1 billion, showing a strong 7% year-over-year growth, primarily driven by increased demand and higher average realized prices [14][42] - Biktarvy sales grew 9% year-over-year to $3.5 billion, while Descovy saw a remarkable 35% increase to $653 million, marking its strongest quarter ever [7][16] - Trodelvy sales increased by 14% year-over-year to $364 million, reflecting continued strength in metastatic breast cancer [24][42] Market Data and Key Metrics Changes - The U.S. PrEP market has expanded to over 5 million active users, growing in the mid-teens year-over-year, with Descovy capturing over 40% market share [17][21] - The company anticipates HIV sales to grow approximately 3% in 2025, up from a previous assumption of flat revenue year-over-year [21][44] - The company is experiencing strong demand for Libdelzi, with revenue almost doubling from $40 million in Q1 to $78 million in Q2 [22][42] Company Strategy and Development Direction - The company is focused on expanding its HIV product portfolio, targeting up to eight additional product launches by 2033, including five by 2030 [32] - The recent FDA approval of lenacapavir (YES2Go) for HIV prevention is seen as a transformative opportunity to address the epidemic [5][32] - The company is committed to facilitating access to lenacapavir globally, partnering with the Global Fund to reach approximately 2 million people in low-income countries over three years [20][32] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong performance in both HIV treatment and prevention, leading to an increase in full-year sales guidance [21][44] - The company remains cautious about potential impacts from the Medicare Part D redesign, which is expected to affect the HIV business by approximately $900 million in 2025 [21][44] - Management emphasized the importance of maintaining operational discipline and adapting to macroeconomic changes while driving forward with new product launches [44][49] Other Important Information - The company returned $1.5 billion to shareholders in Q2, including $527 million in share repurchases, and announced a new $6 billion repurchase program [48] - R&D expenses were up 9% year-over-year, reflecting investments in clinical manufacturing and study activities, with expectations for flat expenses for the full year [42][44] Q&A Session Summary Question: Early uptake of YES2Go and expected trends - Management reported over 25,000 customer calls executed in the field, with a target base of about 15,000, indicating strong early engagement [51][56] - The company anticipates achieving 75% access for YES2Go within six months of launch and 90% within twelve months [58][60] Question: Durability of Descovy's growth rate - Management noted that the PrEP market is growing at about 15% year-over-year, with Descovy's performance driven by favorable access and reduced co-pays [66][69] - There may be a slight decline in Descovy's growth as YES2Go gains traction, but overall market growth is expected to continue [66][70] Question: Impact of MFN proposal on Medicaid - Management acknowledged ongoing discussions regarding the MFN proposal and emphasized the importance of maintaining patient access to medications [74][76] - The company highlighted that HIV treatment has a strong safety net, ensuring coverage for patients even in changing legislative environments [78][79] Question: Changes in commercialization approach if PrEP is removed as a preventative medicine - Management expressed confidence in the current guidelines supporting prevention services and noted that the market has been growing robustly even before recent guidelines [82][84] Question: Confidence in the WONDERS program following clinical hold - Management expressed high confidence in the treatment pipeline, emphasizing a variety of approaches being explored [87]

PART I. FINANCIAL INFORMATION [Item 1. Condensed Consolidated Financial Statements](index=5&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) Presents Gilead Sciences, Inc.'s unaudited interim financial statements as of June 30, 2025, detailing financial position, operations, and cash flows [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to **$55.7 billion** by June 30, 2025, driven by reduced cash, while liabilities and debt also declined Condensed Consolidated Balance Sheet Highlights (in millions) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $5,144 | $9,991 | | Total current assets | $14,718 | $19,173 | | Intangible assets, net | $18,566 | $19,948 | | Goodwill | $8,314 | $8,314 | | **Total assets** | **$55,721** | **$58,995** | | **Liabilities & Equity** | | | | Total current liabilities | $11,189 | $12,004 | | Long-term debt, net | $22,140 | $24,896 | | **Total liabilities** | **$36,131** | **$39,749** | | **Total stockholders' equity** | **$19,590** | **$19,246** | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Gilead reported **$7.08 billion** in Q2 2025 revenues and a significant turnaround to **$3.28 billion** net income for the first six months of 2025 Q2 2025 vs Q2 2024 Statement of Operations (in millions, except EPS) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Total revenues | $7,082 | $6,954 | | Operating income | $2,474 | $2,644 | | Net income attributable to Gilead | $1,960 | $1,614 | | Diluted EPS | $1.56 | $1.29 | Six Months 2025 vs 2024 Statement of Operations (in millions, except EPS) | Metric | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | | Total revenues | $13,749 | $13,640 | | Operating income (loss) | $4,711 | $(1,678) | | Net income (loss) attributable to Gilead | $3,275 | $(2,556) | | Diluted EPS (loss) | $2.61 | $(2.05) | - A significant driver of the improved six-month performance was the reduction in Acquired IPR&D expenses to **$315 million** in 2025 from **$4.17 billion** in 2024, and lower IPR&D impairments of **$190 million** compared to **$2.43 billion** in the prior year[15](index=15&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities decreased to **$2.6 billion** for the first six months of 2025, with significant cash used in financing activities Six Months Ended June 30 Cash Flow Summary (in millions) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $2,584 | $3,544 | | Net cash used in investing activities | $(2,531) | $(2,514) | | Net cash used in financing activities | $(4,993) | $(4,314) | | **Net change in cash and cash equivalents** | **$(4,848)** | **$(3,313)** | - Significant financing activities in the first six months of 2025 included **$1.3 billion** in stock repurchases, **$1.8 billion** in debt repayments, and **$2.0 billion** in dividend payments[26](index=26&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes provide detailed disclosures on accounting policies, revenue breakdown, acquisitions, impairment charges, legal proceedings, and tax rates [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=31&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 and first-half 2025 financial results, highlighting revenue drivers, expense changes, and capital allocation priorities - Total revenues increased **2%** to **$7.1 billion** in Q2 2025, driven by higher HIV, Livdelzi, and Trodelvy sales, partially offset by lower HCV and Veklury sales[108](index=108&type=chunk) - Net income for the first six months of 2025 was **$3.3 billion**, a significant improvement from a **$2.6 billion** net loss in the same period of 2024, primarily due to the absence of large IPR&D expenses and impairment charges from 2024[109](index=109&type=chunk)[110](index=110&type=chunk) - Key business updates include FDA approval for Yeztugo (lenacapavir) for HIV PrEP, conditional EU marketing authorization for seladelpar for PBC, and positive topline results from the Phase 3 ASCENT-03 trial for Trodelvy[105](index=105&type=chunk)[106](index=106&type=chunk) [Results of Operations - Revenues](index=33&type=section&id=Results%20of%20Operations%20-%20Revenues) Total product sales for Q2 2025 were **$7.05 billion**, up **2%** year-over-year, driven by strong HIV franchise growth, offsetting declines in Veklury and Liver Disease sales Product Sales by Therapeutic Area (Q2 2025 vs Q2 2024, in millions) | Therapeutic Area | Q2 2025 Sales | Q2 2024 Sales | YoY Change | | :--- | :--- | :--- | :--- | | **Total HIV** | **$5,088** | **$4,745** | **+7%** | | Biktarvy | $3,530 | $3,232 | +9% | | Descovy | $653 | $485 | +35% | | **Total Liver Disease** | **$795** | **$832** | **-4%** | | **Veklury** | **$121** | **$214** | **-44%** | | **Total Oncology** | **$849** | **$841** | **+1%** | | Cell Therapy | $485 | $521 | -7% | | Trodelvy | $364 | $320 | +14% | - HIV product sales growth was driven by higher demand and higher average realized price, which includes the impact of the U.S. Medicare Part D program redesign[113](index=113&type=chunk) - Veklury sales continued to decline significantly, down **44%** in Q2 and **45%** in the first half of 2025, due to lower rates of COVID-19-related hospitalizations[117](index=117&type=chunk) [Results of Operations - Costs and Expenses](index=36&type=section&id=Results%20of%20Operations%20-%20Costs%20and%20Expenses) R&D expenses increased **10%** in Q2 2025, with a **$190 million** IPR&D impairment for bulevirtide, while Acquired IPR&D and impairments significantly decreased year-over-year for the first six months Costs and Expenses (Q2 2025 vs Q2 2024, in millions) | Expense Category | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Cost of goods sold | $1,501 | $1,544 | -3% | | Research and development (R&D) | $1,491 | $1,351 | +10% | | Acquired IPR&D | $61 | $38 | +61% | | IPR&D impairments | $190 | $0 | NM | | Selling, general & administrative (SG&A) | $1,365 | $1,377 | -1% | - A partial impairment charge of **$190 million** was recorded in Q2 2025 for the bulevirtide IPR&D asset, reflecting a more competitive market outlook[136](index=136&type=chunk) - For the first six months of 2024, the company recorded a **$2.4 billion** partial impairment charge for the Trodelvy NSCLC IPR&D asset after the Phase 3 EVOKE-01 study did not meet its primary endpoint[138](index=138&type=chunk) [Liquidity and Capital Resources](index=40&type=section&id=Liquidity%20and%20Capital%20Resources) Gilead held **$5.1 billion** in cash as of June 30, 2025, with **$2.6 billion** in operating cash flow and **$5.0 billion** used in financing activities for dividends, debt, and repurchases Cash Flow Summary (Six Months Ended June 30, in millions) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $2,584 | $3,544 | | Net cash used in investing activities | $(2,531) | $(2,514) | | Net cash used in financing activities | $(4,993) | $(4,314) | - The company's capital priorities are: (i) investing in the business and R&D, (ii) partnerships and business development, (iii) growing the dividend, and (iv) repurchasing shares[152](index=152&type=chunk) - In August 2025, the Board of Directors declared a quarterly dividend of **$0.79 per share**[158](index=158&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=41&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes to market risk disclosures were reported since the 2024 Annual Report, except for updates in specific financial notes - There were no material changes to the company's market risk disclosures from the 2024 Annual Report, except for updates provided in Notes 3, 4, 5, and 9 of this 10-Q[163](index=163&type=chunk) [Item 4. Controls and Procedures](index=41&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls were effective as of June 30, 2025, while noting ongoing changes due to a new ERP system implementation - The CEO and CFO concluded that disclosure controls and procedures were effective as of June 30, 2025[164](index=164&type=chunk) - The company is implementing a new enterprise resource planning (ERP) system in phases, which has required changes to its internal control over financial reporting[165](index=165&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 10 for detailed descriptions of significant pending legal proceedings, including generic challenges, antitrust lawsuits, and government investigations - For a detailed description of significant legal proceedings, the report refers to Note 10 in Part I, Item 1[167](index=167&type=chunk) - As of December 31, 2024, the company had accrued approximately **$242 million** for legal matters, including **$200 million** for a settlement with the U.S. Attorney's Office that was paid in Q2 2025[79](index=79&type=chunk) [Item 1A. Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors) This section details material risks that could adversely affect Gilead's business, including product, development, regulatory, operational, and financial risks [Product and Commercialization Risks](index=43&type=section&id=Product%20and%20Commercialization%20Risks) Gilead faces risks from heavy reliance on HIV product revenues, complexities of cell therapy commercialization, intense competition, and significant pricing pressures - A substantial portion of revenue comes from HIV products, and the inability to sustain sales or introduce new competitive products could force a scale-back of operations[169](index=169&type=chunk) - The Inflation Reduction Act (IRA) is anticipated to increase payment obligations, limit prices, and increase rebates, thereby reducing profitability[184](index=184&type=chunk)[185](index=185&type=chunk) - The company faces significant competition, and successful commercialization depends on reimbursement from third-party payers who are increasingly attempting to limit or regulate drug prices[181](index=181&type=chunk)[182](index=182&type=chunk) - The company has identified and seized counterfeit versions of its medicines sold by unauthorized distributors, posing a risk to patient health and the company's reputation[196](index=196&type=chunk)[197](index=197&type=chunk) [Product Development and Supply Chain Risks](index=47&type=section&id=Product%20Development%20and%20Supply%20Chain%20Risks) The company faces significant risks in clinical trials, including unfavorable results and delays, and relies heavily on third-party CROs and limited suppliers for manufacturing - There are numerous risks in clinical trials, including unfavorable results; in June 2025, the FDA placed a clinical hold on HIV treatment trials of GS-1720 and GS-4182[200](index=200&type=chunk) - Gilead depends on third-party contract manufacturing organizations (CMOs) for the majority of its active pharmaceutical ingredients and drug products, and some materials are sourced from a single supplier[204](index=204&type=chunk) [Regulatory and Other Legal Risks](index=49&type=section&id=Regulatory%20and%20Other%20Legal%20Risks) Gilead's operations are subject to complex and evolving regulations, with risks from non-compliance, healthcare laws, intellectual property challenges, and ongoing litigation - The company is subject to complex FDA and international regulations, and failure to comply can result in significant penalties, product recalls, or suspension of approvals[207](index=207&type=chunk)[211](index=211&type=chunk) - Generic manufacturers are actively seeking to market generic versions of Gilead's products, leading to patent litigation that could result in an earlier-than-expected loss of exclusivity[220](index=220&type=chunk) - The company is involved in numerous litigation and government investigation matters, which require substantial resources and could result in significant monetary damages or penalties[223](index=223&type=chunk)[225](index=225&type=chunk) [Operational Risks](index=52&type=section&id=Operational%20Risks) Gilead's global operations are exposed to risks from public health emergencies, foreign currency fluctuations, climate change, ERP system implementation, and cybersecurity threats - Global operations are subject to risks including foreign currency exchange fluctuations, political instability, and changes in trade policies[227](index=227&type=chunk) - Climate change poses physical risks to facilities located in vulnerable regions (e.g., California) and transition risks from evolving environmental regulations[228](index=228&type=chunk)[229](index=229&type=chunk) - The company is currently implementing a new ERP system, which entails risks of business disruption, cost overruns, and potential negative impacts on internal controls[241](index=241&type=chunk) - Cybersecurity attacks are increasing in frequency and sophistication, posing a threat to sensitive data, intellectual property, and business operations[242](index=242&type=chunk)[243](index=243&type=chunk) [Strategic and Financial Risks](index=56&type=section&id=Strategic%20and%20Financial%20Risks) Gilead faces risks from unsuccessful acquisitions and collaborations, potential impairment charges, increased debt from financing transactions, and changes in effective tax rates - Acquisitions and collaborations may not be successful and can lead to significant impairment charges, such as those recorded for IPR&D assets in Q2 2025 and Q1 2024[246](index=246&type=chunk) - The company has incurred additional debt to finance strategic transactions, which could result in credit rating downgrades and reduced financial flexibility[247](index=247&type=chunk) - The company's effective tax rate is subject to change based on the mix of earnings across jurisdictions and evolving tax laws, which could adversely affect earnings[248](index=248&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=57&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2025, Gilead repurchased approximately **5.0 million** shares for **$528 million**, and a new **$6.0 billion** stock repurchase program was authorized in July 2025 Stock Repurchase Activity (Q2 2025) | Period | Total Shares Purchased (thousands) | Average Price Paid per Share | Shares Purchased as Part of Program (thousands) | | :--- | :--- | :--- | :--- | | April 2025 | 1,711 | $105.88 | 1,662 | | May 2025 | 1,936 | $103.00 | 1,888 | | June 2025 | 1,887 | $109.49 | 1,425 | | **Total** | **5,534** | **$106.10** | **4,975** | - In July 2025, the Board authorized a new **$6.0 billion** stock repurchase program with no fixed expiration, to begin after the current **$5.0 billion** program is completed[250](index=250&type=chunk) [Item 5. Other Information](index=57&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the second quarter of 2025 - No directors or officers adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter ended June 30, 2025[253](index=253&type=chunk) [Item 6. Exhibits](index=57&type=section&id=Item%206.%20Exhibits) This section provides an index of all exhibits filed with the Form 10-Q, including various agreements, indentures, compensatory plans, and certifications - The Exhibit Index lists all documents filed with the report, such as merger agreements, indentures for senior notes, equity incentive plans, and officer certifications[256](index=256&type=chunk)[257](index=257&type=chunk)[258](index=258&type=chunk)

Financial Performance - Gilead lifted its full-year outlook after strong HIV drug sales in the second quarter [1] - Revenue and earnings modestly beat analyst expectations [1]

Financial Performance - Total product sales excluding Veklury increased by 4% year-over-year (YoY) to $6.9 billion, driven by HIV, Livdelzi, and Trodelvy[8] - Total HIV product sales increased by 7% YoY to $5.1 billion[12] - Oncology product sales increased by 1% YoY to $849 million[12] - Veklury sales decreased by 44% YoY to $121 million[12] - Liver disease product sales decreased by 4% YoY to $795 million[12] - Cell Therapy product sales decreased by 7% YoY to $485 million[12] HIV Business - Biktarvy sales increased by 9% YoY[8] - Descovy sales increased by 35% YoY[8] - FY25 HIV revenue guidance updated to reflect year-to-date (YTD) strength, expecting >7% YoY growth[22] Oncology - Trodelvy sales increased by 14% YoY[8] - Cell Therapy saw a 7% YoY decrease due to evolving competitive landscape[8] Pipeline and Regulatory Updates - FDA approved Yeztugo (lenacapavir) as a twice-yearly injection for HIV prevention[8] - Phase 3 ASCENT-03 & -04 data for Trodelvy in 1L mTNBC showed clinically meaningful results, with FDA filings expected in ~2H 2025[8]

[Second Quarter 2025 Financial Results](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Results) [Overall Performance](index=1&type=section&id=Overall%20Performance) Gilead's Q2 2025 total revenue increased 2% to $7.1 billion, with GAAP EPS rising to $1.56 and non-GAAP EPS flat at $2.01 Q2 2025 Key Financial Metrics | Metric | Q2 2025 | Q2 2024 | Change (YoY) | | :--- | :--- | :--- | :--- | | Total Revenue | $7.1 billion | $7.0 billion | +2% | | Product Sales | $7.1 billion | $6.9 billion | +2% | | Product Sales (ex-Veklury) | $6.9 billion | $6.7 billion | +4% | | GAAP Diluted EPS | $1.56 | $1.29 | +21% | | Non-GAAP Diluted EPS | $2.01 | $2.01 | 0% | | Operating Cash Flow | $827 million | $1,325 million | -38% | - The increase in GAAP EPS was primarily driven by net unrealized gains on securities in Q2 2025 compared to net unrealized losses in Q2 2024, partially offset by a **$190 million** IPR&D impairment charge related to the MYR acquisition[6](index=6&type=chunk) - During the quarter, Gilead paid **$994 million** in dividends and repurchased **$527 million** of common stock[6](index=6&type=chunk) [Product Sales Performance](index=1&type=section&id=Product%20Sales%20Performance) Total product sales increased 2% to $7.1 billion, driven by HIV and Trodelvy, offset by declines in Veklury and Cell Therapy [HIV Franchise](index=1&type=section&id=HIV%20Franchise) HIV franchise sales grew **7%** to **$5.1 billion**, led by **Biktarvy** and **Descovy** Q2 2025 HIV Product Sales (YoY) | Product | Q2 2025 Sales | Change (YoY) | | :--- | :--- | :--- | | **Total HIV** | **$5.1 billion** | **+7%** | | Biktarvy | $3.5 billion | +9% | | Descovy | $653 million | +35% | [Liver Disease Franchise](index=2&type=section&id=Liver%20Disease%20Franchise) Liver Disease sales decreased **4%** to **$795 million** due to lower HCV sales, partially offset by other products - Liver Disease sales decreased **4%** to **$795 million**, mainly driven by lower HCV sales[8](index=8&type=chunk) - The decline in HCV was partly offset by sales growth from Livdelzi, Hepcludex, and HBV products[8](index=8&type=chunk) [Oncology Franchise](index=2&type=section&id=Oncology%20Franchise) Oncology sales showed mixed results, with **Trodelvy** up **14%** but Cell Therapy down **7%** due to competition Q2 2025 Oncology Product Sales (YoY) | Product/Category | Q2 2025 Sales | Change (YoY) | | :--- | :--- | :--- | | **Trodelvy** | **$364 million** | **+14%** | | **Cell Therapy** | **$485 million** | **-7%** | | Yescarta | $393 million | -5% | | Tecartus | $92 million | -14% | [Veklury (COVID-19)](index=2&type=section&id=Veklury%20(COVID-19)) Veklury sales significantly declined **44%** to **$121 million** due to lower COVID-19 hospitalization rates - Veklury sales decreased **44%** to **$121 million**, driven by lower COVID-19 hospitalization rates[8](index=8&type=chunk) [Operating Expenses and Profitability](index=2&type=section&id=Operating%20Expenses%20and%20Profitability) Gross margins improved, R&D expenses increased due to clinical activity, while SG&A remained flat, impacting profitability Q2 2025 Operating Metrics | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Product Gross Margin (GAAP) | 78.7% | 77.7% | | Product Gross Margin (Non-GAAP) | 86.9% | 86.0% | | R&D Expenses (GAAP) | $1.5 billion | $1.4 billion | | SG&A Expenses (GAAP) | $1.4 billion | $1.4 billion | | Effective Tax Rate (GAAP) | 19.3% | 21.4% | | Effective Tax Rate (Non-GAAP) | 18.8% | 17.8% | - The increase in R&D expenses was primarily due to increased clinical manufacturing and study expenses, as well as valuation adjustments to the MYR-related contingent consideration[13](index=13&type=chunk) [Guidance and Outlook](index=2&type=section&id=Guidance%20and%20Outlook) [Full-Year 2025 Guidance](index=2&type=section&id=Full-Year%202025%20Guidance) Gilead raised its full-year 2025 guidance for product sales (ex-Veklury) and EPS, while lowering Veklury sales forecast Updated Full-Year 2025 Guidance | Metric | New Guidance (Aug 7, 2025) | Prior Guidance | | :--- | :--- | :--- | | Product Sales | $28.3B - $28.7B | $28.2B - $28.6B | | Product Sales (ex-Veklury) | $27.3B - $27.7B | $26.8B - $27.2B | | Veklury Sales | ~$1.0B | ~$1.4B | | Diluted EPS (GAAP) | $5.85 - $6.15 | $5.65 - $6.05 | | Non-GAAP Diluted EPS | $7.95 - $8.25 | $7.70 - $8.10 | [Key Business and Pipeline Updates](index=3&type=section&id=Key%20Business%20and%20Pipeline%20Updates) [Virology](index=3&type=section&id=Virology) Virology highlights include FDA approval for **Yeztugo** HIV PrEP, a Global Fund partnership, and a clinical hold on HIV trials - Received U.S. FDA approval for **Yeztugo® (lenacapavir)** for pre-exposure prophylaxis (PrEP), making it the first twice-yearly HIV prevention option[17](index=17&type=chunk) - Announced a strategic partnership with the Global Fund to accelerate access to lenacapavir for HIV PrEP in low- and lower-middle-income countries[17](index=17&type=chunk) - The FDA placed a clinical hold on the HIV treatment trials of investigational candidates GS-1720 and/or GS-4182[17](index=17&type=chunk) [Oncology](index=3&type=section&id=Oncology) Oncology updates include positive **Trodelvy** Phase 3 results, **Yescarta** real-world data, and a new licensing deal with Kymera Therapeutics - Announced positive topline results from the Phase 3 ASCENT-03 trial evaluating **Trodelvy** in 1L metastatic triple-negative breast cancer (mTNBC)[17](index=17&type=chunk) - Presented new real-world data supporting the use of **Yescarta** in outpatient care settings for patients with relapsed or refractory large B-cell lymphoma[17](index=17&type=chunk) - Entered into an exclusive option and license agreement with Kymera Therapeutics to develop novel oral molecular glue CDK2 degraders for oncology[17](index=17&type=chunk) [Inflammation](index=4&type=section&id=Inflammation) New data on **Livdelzi** for primary biliary cholangitis was presented at EASL, including an interim long-term study analysis - Presented new data at EASL from multiple analyses evaluating **Livdelzi** for the treatment of primary biliary cholangitis[18](index=18&type=chunk) [Corporate Developments](index=4&type=section&id=Corporate%20Developments) Corporate developments include a **$0.79** dividend, a **$6.0 billion** stock repurchase program, and a DOJ settlement - The Board declared a Q3 2025 dividend of **$0.79 per share**[25](index=25&type=chunk) - A new **$6.0 billion** stock repurchase program was authorized by the Board[25](index=25&type=chunk) - Reached a final settlement agreement with the U.S. Department of Justice for a legacy compliance matter, which was previously accrued in 2024[25](index=25&type=chunk) [Financial Statements](index=7&type=section&id=Financial%20Statements) [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Unaudited income statements for Q2 and H1 2025 and 2024, detailing revenues, costs, operating income, and net income [Condensed Consolidated Balance Sheets](index=14&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Unaudited balance sheets as of June 30, 2025, and December 31, 2024, detailing assets, liabilities, and equity Balance Sheet Summary | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash, cash equivalents and marketable debt securities | $7,126 million | $9,991 million | | Total Assets | $55,721 million | $58,995 million | | Total Liabilities | $36,131 million | $39,748 million | | Stockholders' Equity | $19,590 million | $19,246 million | [Selected Cash Flow Information](index=15&type=section&id=Selected%20Cash%20Flow%20Information) Cash flow details for Q2 and H1 2025 and 2024, covering operating, investing, and financing activities, including non-GAAP free cash flow Cash Flow Summary (Three Months Ended June 30) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $827 million | $1,325 million | | Net cash used in investing activities | ($2,116) million | ($307) million | | Net cash used in financing activities | ($1,566) million | ($2,953) million | [Detailed Product Sales Summary](index=8&type=section&id=Detailed%20Product%20Sales%20Summary) Detailed product sales breakdown by therapeutic area, major product, and geographic region for Q2 and H1 2025 and 2024 [Reconciliation of GAAP to Non-GAAP Measures](index=9&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Measures) Detailed reconciliation tables for GAAP to non-GAAP financial results for reported periods and full-year 2025 guidance

Earnings Report - Gilead Sciences, Inc. is set to release its second-quarter earnings results on August 7, with analysts expecting earnings of $1.96 per share, a decrease from $2.01 per share in the same period last year [1] - The projected quarterly revenue is $6.96 billion, slightly up from $6.95 billion a year earlier [1] Analyst Upgrade - Needham analyst Joseph Stringer upgraded Gilead Sciences from Hold to Buy, setting a price target of $133 [2] - The company currently offers an annual dividend yield of 2.87%, translating to a quarterly dividend of 79 cents per share, or $3.16 annually [2] Dividend Strategy - To achieve a monthly income of $500 from dividends, an investment of approximately $209,422 or around 1,899 shares is required [2] - For a more modest monthly income of $100, an investment of $41,906 or around 380 shares is necessary [2] Dividend Yield Calculation - The dividend yield is calculated by dividing the annual dividend payment by the stock's current price, which can fluctuate based on stock price changes [3] - Changes in dividend payments also affect the yield; an increase in dividends raises the yield if the stock price remains constant, while a decrease lowers it [4] Stock Performance - Gilead Sciences shares fell by 1.9%, closing at $110.28 on Wednesday [4]

Industry Overview - The second-quarter earnings season for the drug and biotech sector is in full swing, with major companies like Pfizer, Eli Lilly, Amgen, Gilead Sciences, and Novo Nordisk set to announce results [1] - The earnings season began mid-July with Johnson & Johnson reporting strong results, exceeding estimates for both earnings and sales [1] Company Performance Pfizer (PFE) - Pfizer has consistently exceeded earnings expectations in the last four quarters, with an average earnings surprise of 43.49% [6] - The Zacks Consensus Estimate for second-quarter sales and earnings is $13.78 billion and 58 cents per share, respectively [6] - Higher sales from products like Vyndaqel and Padcev are expected to offset weaker sales from Prevnar and Ibrance [8] Eli Lilly (LLY) - Eli Lilly's performance has been mixed, exceeding earnings expectations in two of the last four quarters, with an average earnings surprise of 6.69% [11] - The Zacks Consensus Estimate for second-quarter sales and earnings stands at $14.75 billion and $5.61 per share, respectively [11] - Strong demand for Mounjaro and Zepbound is anticipated to drive top-line growth [12] Amgen (AMGN) - Amgen has shown strong performance, beating earnings estimates in each of the last four quarters, with an average earnings surprise of 8.34% [14] - The Zacks Consensus Estimate for second-quarter sales and earnings is $8.86 billion and $5.26 per share, respectively [14] - Sales growth is expected to be driven by products like Evenity and Repatha, despite price declines due to higher rebates [15] Gilead Sciences (GILD) - Gilead's performance has been mixed, with earnings beating estimates in three of the last four quarters, averaging a surprise of 16.48% [17] - The Zacks Consensus Estimate for second-quarter sales and earnings is $6.95 billion and $1.95 per share, respectively [17] - Increased demand for HIV therapies like Biktarvy is expected to boost sales [18] Novo Nordisk (NVO) - Novo Nordisk's performance has been mixed, with earnings beating estimates in one of the last four quarters, delivering an average surprise of 0.02% [20] - The Zacks Consensus Estimate for second-quarter sales and earnings is $11.79 billion and 93 cents per share, respectively [20] - The company lowered its 2025 sales and operating profit growth outlook due to weaker momentum in key markets for its semaglutide-based drugs [21]