AbbVie(US:ABBV)2023-05-04 16:00Financial Performance - AbbVie reported worldwide net revenues of $12.2 billion for the three months ended March 31, 2023, a decrease of 10% on a reported basis and 8% on a constant currency basis compared to the same period in 2022[107]. - Total net revenues for the three months ended March 31, 2023 were $12,225 million, a decrease of 9.7% compared to $13,538 million for the same period in 2022[120]. - International net revenues decreased by 5.2% to $3.0 billion, with a slight increase of 0.9% on a constant currency basis[115]. - Gross margin for the three months ended March 31, 2023 was $8,239 million, representing a 13% decrease from $9,486 million in the prior year[122]. - Operating cash flows decreased to $4,193 million for the three months ended March 31, 2023, compared to $4,908 million in the prior year[130]. - The effective tax rate increased to 49% for the three months ended March 31, 2023, compared to 9% for the same period in 2022[129]. - Cash dividend payments increased to $2.7 billion for the three months ended March 31, 2023, up from $2.5 billion in the prior year[133]. Earnings and Costs - Diluted earnings per share for the same period was $0.13, impacted by after-tax costs including $1.8 billion for contingent consideration liabilities and $1.6 billion for amortization of intangible assets[107]. - Research and development expenses increased to $2,292 million for the three months ended March 31, 2023, a 53% increase compared to $1,497 million in the prior year[124]. - Interest expense for the three months ended March 31, 2023 was $553 million, up from $548 million in the prior year, primarily due to higher interest rates[126]. Product Performance - The U.S. net revenues for Humira decreased by 26.1% to $2.9 billion, while Skyrizi's U.S. revenues increased by 45.9% to $1.1 billion[116]. - Global Humira sales decreased 24% for the three months ended March 31, 2023, with U.S. sales down 26% due to direct biosimilar competition[118]. - Net revenues for Skyrizi increased 46% for the three months ended March 31, 2023, driven by strong volume and market share uptake[118]. - Net revenues for Rinvoq increased 51% for the three months ended March 31, 2023, primarily due to continued strong volume and market share uptake[119]. Pipeline and Development - AbbVie's pipeline includes over 90 compounds, with more than 50 in mid- and late-stage development, focusing on immunology, oncology, aesthetics, neuroscience, and eye care[108]. - AbbVie expects multiple mid-stage programs to transition into late-stage programs within the next 12 months, indicating a strong pipeline progression[110]. - The company anticipates several regulatory submissions and data readouts from key clinical trials in the next 12 months, supporting its growth strategy[106]. - Qulipta received FDA approval for the preventive treatment of chronic migraine in adults, marking a significant addition to AbbVie's neuroscience portfolio[113]. Financial Strategy and Flexibility - AbbVie aims to generate substantial operating cash flows to support investment in innovative research and development while returning cash to shareholders through dividends[106]. - AbbVie authorized a $5.0 billion increase to its stock repurchase program, repurchasing 10 million shares for $1.6 billion in Q1 2023[135]. - The company entered into a five-year revolving credit facility, increasing commitments from $4.0 billion to $5.0 billion, maturing in March 2028[136]. - AbbVie had no outstanding amounts under its credit facility as of March 31, 2023, and was in compliance with all covenants[136]. - The company believes it has sufficient financial flexibility to issue debt and attract long-term capital to support growth objectives[137]. Risk Management and Accounting - AbbVie continues to monitor economic conditions and customer creditworthiness to mitigate credit risk[136]. - The company has established an allowance for credit losses based on estimated future losses over the life of outstanding accounts receivable[136]. - AbbVie cautions that forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially[140]. - The company has not made significant changes to its critical accounting policies in Q1 2023[139]. - For detailed market risk disclosures, refer to Item 7A in AbbVie's Annual Report on Form 10-K for the year ended December 31, 2022[141].