Novartis delivers solid sales and core operating income growth with strong pipeline progress in Q3; reaffirms FY 2025 guidance

Core Insights - Novartis reported solid financial performance in Q3 2025, with net sales of USD 13.9 billion, an increase of 8% year-over-year, driven by strong execution on key growth drivers [3][8][32] - The company achieved FDA approval for Rhapsido and positive Phase III results for ianalumab, which are expected to support growth through 2030 and beyond [3][5][19] - Novartis reaffirmed its full-year 2025 guidance, expecting high single-digit sales growth and low-teens growth in core operating income [5][30] Financial Performance - Q3 2025 net sales reached USD 13.9 billion, up 8% from Q3 2024, with a 7% increase in constant currencies [3][32] - Operating income for Q3 2025 was USD 4.5 billion, a 24% increase year-over-year, while net income rose to USD 3.9 billion, up 23% [9][33] - Core EPS for Q3 2025 increased to USD 2.25, reflecting a 9% growth compared to the previous year [10][33] Key Growth Drivers - Significant sales growth was observed in priority brands: Kisqali (+68% cc), Kesimpta (+44% cc), Pluvicto (+45% cc), and Scemblix (+95% cc) [5][16] - The core operating income margin remained stable at 39.3%, despite the increasing impact of generics [5][10] Research and Development Updates - Rhapsido received FDA approval as the first oral BTK inhibitor for chronic spontaneous urticaria [19] - Ianalumab showed positive Phase III results in Sjögren's disease, with plans for global regulatory submissions [21] - Pluvicto demonstrated a 28% reduction in risk of progression or death in a Phase III trial for prostate cancer [22] Strategic Focus - Novartis is concentrating on four core therapeutic areas: cardiovascular-renal-metabolic, immunology, neuroscience, and oncology, with ongoing investments in R&D capabilities [5][6] - The company aims to strengthen its pipeline through strategic acquisitions and collaborations, including the recent agreement to acquire Tourmaline Bio [23][24] Capital Structure and Shareholder Returns - Novartis repurchased 66.4 million shares for USD 7.5 billion during the first nine months of 2025, reducing the total number of shares outstanding [27] - Net debt increased to USD 20.4 billion as of September 30, 2025, primarily due to cash outflows for dividends and share repurchases [28]