Amgen(US:AMGN)2024-05-02 23:27Financial Performance - Total revenues for the three months ended March 31, 2024, were $7,447 million, a 22% increase from $6,105 million in the same period of 2023[10]. - Product sales reached $7,118 million, up from $5,846 million, reflecting a 22% growth year-over-year[10]. - Operating income decreased to $991 million from $1,921 million, representing a decline of 48%[10]. - Net loss for the three months ended March 31, 2024, was $(113) million compared to a net income of $2,841 million in the same period of 2023[10]. - Basic and diluted loss per share for the current period was $(0.21), down from earnings of $5.32 and $5.28, respectively, in the prior year[10]. - The company reported a pretax loss of $68 million for Q1 2024, compared to a pretax income of $3,442 million in Q1 2023[45]. - The effective tax rate for the three months ended March 31, 2024, was (66.2)%, compared to 17.5% for the same period in 2023, primarily due to the earnings mix from the inclusion of the Horizon business[45][46]. Expenses and Investments - Research and development expenses increased to $1,343 million from $1,058 million, marking a 27% rise[10]. - Total operating expenses rose to $6,456 million, up from $4,184 million, indicating a 54% increase[10]. - The company reported depreciation and amortization expenses of $1,399 million for the quarter, compared to $900 million in the prior year[23]. - Amortization of finite-lived intangible assets for the three months ended March 31, 2024, was $1.2 billion, compared to $693 million for the same period in 2023, indicating a significant increase of approximately 73.2%[74]. - The total estimated amortization of finite-lived intangible assets for the remaining nine months of 2024 is projected to be $3.6 billion[74]. Cash and Assets - Cash and cash equivalents decreased to $9,708 million from $10,944 million[15]. - Total assets as of March 31, 2024, were $92,980 million, down from $97,154 million at the end of 2023[15]. - Total inventories decreased to $8,724 million as of March 31, 2024, from $9,518 million as of December 31, 2023, a decline of approximately 8.3%[67]. - The fair value of money market mutual funds decreased from $10,266 million as of December 31, 2023, to $9,099 million as of March 31, 2024[89]. - The fair value of equity securities decreased from $4,514 million as of December 31, 2023, to $3,985 million as of March 31, 2024[89]. Debt and Liabilities - Long-term debt decreased to $60,061 million from $63,170 million, reflecting a reduction of 5%[15]. - The total carrying value of debt decreased to $64,020 million as of March 31, 2024, from $64,613 million as of December 31, 2023[78]. - The company repurchased portions of various notes for an aggregate cost of $410 million during the three months ended March 31, 2024, resulting in a $133 million gain on extinguishment of debt[79]. - Total liabilities as of March 31, 2024, were $1,168 million, compared to $1,188 million as of December 31, 2023[89]. Acquisitions - The company completed the acquisition of Horizon Therapeutics for approximately $27.8 billion, enhancing its portfolio in rare diseases[31]. - The acquisition included cash consideration of $26.7 billion and additional costs related to options and equity awards totaling $523 million[33]. - The fair value of developed-product-technology rights acquired in the Horizon acquisition was estimated at $19,590 million[34]. - The estimated fair value of acquired inventory from Horizon was $5,025 million, with amortization expected over approximately 27 months[35]. Legal and Regulatory Matters - Legal proceedings and investigations may have outcomes that are difficult to predict, potentially affecting the company's financial position[116]. - The company is involved in patent litigation concerning Repatha and other products, with significant hearings scheduled in the coming years[118]. - Amgen's patent claims related to the '736 Patent were found valid and enforceable by the New Jersey District Court[121]. - Amgen successfully dismissed indirect purchasers' claims in the antitrust class actions in Delaware District Court[122]. Market and Investment Risks - The company recognized an unrealized loss of $454 million on its equity investment in BeiGene for the three months ended March 31, 2024, compared to an unrealized gain of $1.9 billion for the same period in 2023[60]. - The carrying value of the equity investment in BeiGene was $3.0 billion as of March 31, 2024, down from $3.4 billion as of December 31, 2023[60]. - The company incurred net changes in valuations of contingent consideration obligations of $2 million for the three months ended March 31, 2024[94].