Elanco(US:ELAN)2025-11-05 11:30Revenue Performance - Revenue for Q3 2025 was $1,137 million, a 10% increase year-over-year, with 9% organic constant currency growth[5] - Pet Health revenue was $533 million in Q3 2025, a 10% increase year-over-year, driven by new products including Credelio Quattro and Zenrelia[8] - Farm Animal revenue reached $593 million in Q3 2025, a 12% increase year-over-year, with strong sales in cattle and poultry[10] - Revenue for Q3 2025 was $1,137 million, a 10.4% increase from $1,030 million in Q3 2024[37] Profitability Metrics - Adjusted EBITDA for Q3 2025 was $198 million, representing a 21% increase compared to Q3 2024, with an adjusted EBITDA margin of 17.5%[17] - Adjusted EPS for Q3 2025 was $0.19, a 46% increase compared to the same period in 2024[16] - Gross profit for Q3 2025 was $607 million, compared to $538 million in Q3 2024, resulting in a gross margin of 53.1%[39] - Adjusted gross profit for Q3 2025 was $601 million, with an adjusted gross margin percentage of 53.1%[39] Financial Guidance - The company raised its full-year revenue guidance to a range of $4,645 million to $4,670 million, expecting organic constant currency revenue growth of 6% to 6.5%[5] - Elanco plans to provide financial guidance for Q4 and full year 2025 during the conference call[25] - The full year 2025 adjusted EPS guidance is projected to be between $0.91 and $0.94, with reported loss per share guidance ranging from $(0.11) to $(0.08)[50] - The full year 2025 adjusted EBITDA guidance is estimated to be between $880 million and $900 million, with reported net loss guidance ranging from $(56) million to $(41) million[52] Debt and Leverage - The company improved its year-end net leverage ratio target to 3.7x to 3.8x, down from 4.3x at the end of 2024[5] - As of September 30, 2025, the company's net debt was $3,281 million, with a net leverage ratio of 3.7[48] - The company reported a total gross debt of $4,041 million as of September 30, 2025[48] - The company successfully refinanced its $2.1 billion Term Loan B debt facility, improving its debt portfolio's maturity risk profile[9] Expenses - Operating expenses for Q3 2025 were $440 million, a 7% increase year-over-year, driven by strategic investments in new product launches[12] - Research and development expenses for Q3 2025 were $89 million, slightly up from $87 million in Q3 2024[37] - The company reported an interest expense of $52 million for Q3 2025, down from $58 million in Q3 2024[37] Net Income and Loss - Net loss for Q3 2025 was $34 million, compared to a net income of $364 million in Q3 2024[37] - For the three months ended September 30, 2025, adjusted net income was $94 million, resulting in adjusted EPS of $0.19, compared to adjusted net income of $66 million and adjusted EPS of $0.13 for the same period in 2024[40] - The company reported a GAAP net loss of $34 million for the three months ended September 30, 2025, compared to a net income of $364 million for the same period in 2024[40] Future Projections - Reported net loss for Q4 2025 is projected between $(100) million and $(86) million[54] - Adjusted EBITDA guidance for Q4 2025 is estimated to be between $168 million and $188 million[54] - Adjusted EBITDA margin is expected to range from 15.5% to 16.9%[54] Innovation and Market Strategy - Credelio Quattro achieved $100 million in net sales in under eight months, marking it as Elanco's fastest pet health blockbuster[4] - Elanco's innovation revenue is defined as revenue from new products and geographic expansions, excluding cannibalization effects[34] - The company is focused on addressing risks related to competition, regulatory changes, and operational challenges in the animal health industry[30]