Gilead(GILD) - 2025 Q2 - Quarterly Results

Second Quarter 2025 Financial Results Overall Performance 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] - During the quarter, Gilead paid $994 million in dividends and repurchased $527 million of common stock[6] Product Sales Performance Total product sales increased 2% to $7.1 billion, driven by HIV and Trodelvy, offset by declines in Veklury and Cell Therapy HIV Franchise 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 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] - The decline in HCV was partly offset by sales growth from Livdelzi, Hepcludex, and HBV products[8] Oncology Franchise 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) 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] Operating Expenses and Profitability 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] Guidance and Outlook Full-Year 2025 Guidance 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 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] - Announced a strategic partnership with the Global Fund to accelerate access to lenacapavir for HIV PrEP in low- and lower-middle-income countries[17] - The FDA placed a clinical hold on the HIV treatment trials of investigational candidates GS-1720 and/or GS-4182[17] 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] - 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] - Entered into an exclusive option and license agreement with Kymera Therapeutics to develop novel oral molecular glue CDK2 degraders for oncology[17] 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] Corporate Developments 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] - A new $6.0 billion stock repurchase program was authorized by the Board[25] - Reached a final settlement agreement with the U.S. Department of Justice for a legacy compliance matter, which was previously accrued in 2024[25] Financial Statements Condensed Consolidated Statements of Operations Unaudited income statements for Q2 and H1 2025 and 2024, detailing revenues, costs, operating income, and net income Condensed Consolidated Balance Sheets 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 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 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 Detailed reconciliation tables for GAAP to non-GAAP financial results for reported periods and full-year 2025 guidance