Will Weak Gardasil Sales Continue to Ail MRK Revenues in Q4 Earnings?

Core Insights - Merck (MRK) is experiencing significant challenges with its second-largest product, Gardasil, which has seen a decline in sales starting in 2024 after consistent growth until 2022 [1][3] Sales Performance - In the first nine months of 2025, Gardasil sales fell by 40% year-over-year to $4.20 billion, primarily due to weak demand in China amid an economic slowdown [2][9] - The company has temporarily halted Gardasil shipments in China to manage excess inventory levels at its partner Zhifei [3][9] - Sales of other vaccines, including ProQuad, M-M-R II, Varivax, RotaTeq, and Pneumovax 23, also declined during the same period [5][9] New Products and Competition - Merck's new RSV antibody, Enflonsia, was approved in the U.S. in June 2025 and generated $79 million in sales in Q3 2025, although it faces competition from AstraZeneca/Sanofi's Beyfortus, which recorded €1.09 billion in sales, up 33.8% year-over-year [6][7] - The company anticipates that sales of Enflonsia will be a focal point in the upcoming Q4 2025 results [6] Market Performance and Valuation - Over the past six months, Merck's shares have increased by 37.2%, outperforming the industry average of 23.6% [8] - Merck's current price/earnings ratio stands at 13.54, which is lower than the industry average of 17.72 but higher than its five-year mean of 12.48 [10] Earnings Estimates - The Zacks Consensus Estimate for Merck's 2025 earnings per share has slightly decreased from $8.97 to $8.96, while the estimate for 2026 has dropped from $9.28 to $7.92 over the past 60 days [11]