Gilead(US:GILD)2025-05-07 20:32Financial Performance - Total revenues for Q1 2025 were $6,667 million, a slight decrease of 0.3% compared to $6,686 million in Q1 2024[15] - Product sales amounted to $6,613 million in Q1 2025, down from $6,647 million in Q1 2024, reflecting a decrease of 0.5%[15] - Net income for Q1 2025 was $1,315 million, a significant recovery from a net loss of $4,170 million in Q1 2024[15] - Operating income for Q1 2025 was $2,237 million, compared to an operating loss of $4,322 million in the same period last year[15] - Basic earnings per share attributable to Gilead for Q1 2025 was $1.06, a recovery from a loss of $3.34 per share in Q1 2024[15] - Gilead's income before income taxes for Q1 2025 was $1,649 million, compared to a loss of $4,486 million in Q1 2024[86] Cash Flow and Investments - Cash provided by operating activities for the three months ended March 31, 2025, was $1,757 million, down from $2,219 million in the same period of 2024[24] - Net cash used in investing activities was $415 million for Q1 2025, compared to $2,207 million in Q1 2024, indicating a reduction in cash outflow[24] - The company reported a net cash used in financing activities of $3,426 million for Q1 2025, an increase from $1,361 million in Q1 2024[24] - Cash and cash equivalents at the end of the period were $7,926 million, up from $4,718 million at the end of Q1 2024[24] - Total cash and cash equivalents at the beginning of the period were $9,991 million, reflecting a strong liquidity position[24] Assets and Liabilities - Total current assets decreased to $16,901 million as of March 31, 2025, down from $19,173 million as of December 31, 2024[13] - Total assets decreased to $56,434 million as of March 31, 2025, compared to $58,995 million as of December 31, 2024[13] - Long-term debt decreased to $22,146 million as of March 31, 2025, down from $24,896 million as of December 31, 2024[13] - As of March 31, 2025, total debt, net amounted to $24,952 million, a decrease from $26,710 million as of December 31, 2024[69] - The company repaid $1.75 billion of principal balance related to senior unsecured notes due at maturity in February 2025[70] Research and Development - Research and development expenses decreased to $1,379 million in Q1 2025 from $1,520 million in Q1 2024, a reduction of approximately 9.3%[15] - A partial impairment charge of $2.4 billion was recorded for certain acquired in-process research and development assets during the three months ended March 31, 2024[38] - A partial impairment charge of $2.4 billion was recognized for the NSCLC IPR&D intangible asset due to a failed Phase 3 study[58] Legal and Regulatory Matters - The company intends to vigorously defend against various lawsuits, including those related to product liability involving approximately 22,000 active plaintiffs[79] - The company is involved in litigation with generic manufacturers regarding the exclusivity of its products, which could significantly impact revenues[73] - The company has approximately $220 million in accruals for legal matters as of March 31, 2025, down from $242 million as of December 31, 2024[72] - A settlement agreement was reached in April 2025 with the U.S. Attorney's Office for the Southern District of New York related to a government investigation[80] - The company accrued approximately $200 million for a settlement with the U.S. Attorney's Office for the Southern District of New York in April 2025[72] Segment Performance - Product sales in the HIV segment totaled $4,587 million for Q1 2025, up from $4,342 million in Q1 2024, representing an increase of 5.6%[29] - The company recognized $54 million in royalty, contract, and other revenues for Q1 2025, compared to $39 million in Q1 2024[29] Expenses - Selling and marketing expenses increased to $753 million in Q1 2025 from $743 million in Q1 2024, while general and administrative expenses decreased to $505 million from $632 million[89] - Gilead's total selling, general, and administrative expenses for Q1 2025 were $1,258 million, down from $1,375 million in Q1 2024[89] - Other (income) expense, net reported a loss of $328 million in Q1 2025, compared to a gain of $91 million in Q1 2024[68] Tax Matters - The effective tax rate for Q1 2025 was 20.2%, up from 7.0% in Q1 2024, primarily due to tax benefits from stock-based compensation and adjustments[86][87] - The company is currently under examination by the IRS for tax years 2019 to 2021, which may lead to disputes regarding tax deductions and income allocations[88] - Gilead's effective income tax rate in Q1 2024 was impacted by $3.9 billion of non-deductible acquired IPR&D expenses related to the acquisition of CymaBay[87] Other Financial Metrics - Unrealized losses related to equity securities amounted to $436 million for the three months ended March 31, 2025, compared to $15 million in the same period of 2024[44] - The fair value of the contingent consideration liability related to the acquisition of MYR GmbH increased to $216 million as of March 31, 2025, from $206 million at the beginning of the period[36] - The total estimated fair value of senior unsecured notes was $21.886 billion as of March 31, 2025, down from $23.335 billion at the end of 2024[39] - The liability related to future royalties from the acquisition of Immunomedics, Inc. was approximately $0.9 billion as of March 31, 2025[40] Acquisitions and Investments - Gilead made a $250 million upfront payment to LEO Pharma for a strategic partnership to develop STAT6 programs, with potential additional milestone payments of up to $1.5 billion[54] - Gilead acquired approximately 15.2 million additional shares of Arcus for $320 million, increasing its stake to approximately 30%[55] - The acquisition of CymaBay Therapeutics, Inc. was completed for total consideration of $3.9 billion in March 2024[51] Subsequent Events - There were no subsequent events or transactions to disclose beyond those already mentioned in the financial statements[90]