Pfizer (PFE) Q2 2025 Earnings Call August 05, 2025 10:00 AM ET Company ParticipantsFrancesca DeMartino - SVP & Chief Investor Relations OfficerAlbert Bourla - Chairman & CEODave Denton - EVP & CFOTrung Huynh - Executive Director & Equity ResearchAamir Malik - EVP & Chief U.S. Commercial OfficerChris Schott - Managing DirectorChris Boshoff - Chief Scientific Officer and President - R&DAlexandria Hammond - Director - Head of TherapeuticsMohit Bansal - Managing DirectorAlexandre de Germay - EVP & Chief Interna ...

Financial Data and Key Metrics Changes - For Q2 2025, Pfizer recorded revenues of $14.7 billion, an increase of 10% operationally compared to the previous year [32] - Reported diluted earnings per share (EPS) was $0.51, while adjusted diluted EPS was $0.78, exceeding expectations due to strong top-line performance and effective cost management [33][37] - Adjusted gross margin for the quarter was approximately 76%, reflecting the product mix [35] Business Line Data and Key Metrics Changes - The Vyndaqel family achieved 21% year-over-year operational growth, contributing significantly to the overall performance [20] - Recently launched and acquired products generated $4.7 billion in revenue, growing approximately 15% operationally [34] - Ibrance experienced declines, while Paxlovid and Eliquis showed strong contributions to revenue [33] Market Data and Key Metrics Changes - Internationally, Pfizer saw strong performance with 9% growth in emerging markets and 7% growth in Europe [84] - The oncology portfolio, particularly Paltzem, achieved 38% year-over-year operational growth [23] - The non-small cell lung cancer market is expected to reach over $60 billion by 2030, indicating significant growth potential for Pfizer's products in this area [12] Company Strategy and Development Direction - Pfizer's top strategic priority is improving R&D productivity, with a focus on key programs that address substantial patient needs [7] - The company is leveraging technology such as AI and automation to drive productivity gains and expand margins [6] - Pfizer aims to maintain a strong balance sheet while pursuing business development opportunities, particularly in oncology and immunology [39][88] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate a complex geopolitical environment while focusing on business advancement [6] - The guidance for full-year 2025 revenues is maintained in the range of $61 billion to $64 billion, reflecting strong operational performance [42] - Management is cautious about potential impacts from tariffs and price changes, indicating ongoing discussions with government officials [50][52] Other Important Information - Pfizer's capital allocation strategy includes maintaining and growing dividends while investing in R&D and pursuing share repurchases [38] - The company expects to achieve approximately $7.7 billion in savings by 2027 through cost realignment programs [40] - Pfizer is preparing for a phase three start of its second-generation C. Difficile vaccine candidate by the end of the year [15] Q&A Session Questions and Answers Question: Guidance on potential price changes and MFN impact - Management is engaged in productive discussions regarding the MFN situation and tariffs but cannot provide specific details at this time [49][51] Question: Insights on capital allocation and leverage targets - The target leverage has been lowered to 2.7 times due to improved cash generation capabilities, with a focus on smaller deals for business development [60][64] Question: Efficiency in operating model and investment priorities - Pfizer has implemented a new commercial model that emphasizes efficiency and resource reallocation, focusing on key growth drivers in various markets [81][85] Question: ADCETRIS performance and tax outlook - The cGen portfolio has integrated well, showing a 15% year-over-year growth, while the tax rate is expected to stabilize around 15% in the long term [102][104]