NYSE$MRK

Merck & Co. · Q3 2024 earnings

Q3 2024 earnings · · Investor relations

Briefing

Merck's third-quarter results were strong, driven by KEYTRUDA, new launches, and Animal Health business, but partially offset by lower sales of JANUVIA, JANUMET, GARDASIL/GARDASIL 9, and LAGEVRIO.

Merck reported a 4% increase in worldwide sales, reaching $16.7 billion in Q3 2024. GAAP EPS was $1.24, and non-GAAP EPS was $1.57. The results were driven by KEYTRUDA, new product launches like WINREVAIR, and strong growth in Animal Health, offset by declines in other products.

  • Total worldwide sales reached $16.7 billion, a 4% increase compared to Q3 2023.
  • GAAP EPS was $1.24, while non-GAAP EPS was $1.57.
  • Sales growth was driven by KEYTRUDA, new launches including WINREVAIR, and Merck’s Animal Health business.
  • Growth was partially offset by lower sales of JANUVIA and JANUMET, lower combined sales of GARDASIL/GARDASIL 9 and lower sales of LAGEVRIO.

Headline financials

Total Revenue

$16.7B

Previous: $16B+4.4%
EPS

$1.24

Previous: $2.13-41.8%
KEYTRUDA sales

$7.43B

Previous: $6.34B+17.3%
GARDASIL sales

$2.31B

Previous: $2.61B-11.7%
WINREVAIR sales

$149M

No prior period
Capital Expenditures

-$2.44B

Previous: -$2.87B+15.3%
Free Cash Flow

$722M

Previous: $1.87B-61.4%
Net Income

$3.16B

Previous: $4.75B-33.5%
Operating Income

$3.93B

Previous: $5.73B-31.5%
Gross Profit

$12.6B

Previous: $11.7B+7.5%
Cash & Equivalents

$14.6B

Previous: $8.61B+69.6%
Total Assets

$118B

Previous: $107B+10.1%
R&D Expense

$5.84B

Previous: $3.31B+76.5%
Stock-Based Comp

$195M

Previous: $164M+18.9%

Revenue & EPS history

Merck · Revenue · Quarterly

$16.7B

Q3 2024+4.4%vs Q3 2023
Beat estimate in 12 of 15 quarters(80%)
ActualEstimate

Revenue by segment

Merck · $15B total across 2 segments · Q2 2023

  • Pharmaceutical
    $13.5B+5.6%
  • Animal Health
    $1.51B+0.6%

Forward guidance

Merck narrowed the range of its full-year sales outlook. Merck now expects its full-year sales to be between $63.6 billion and $64.1 billion, including a negative impact of foreign exchange of approximately 3 percentage points, at mid-October 2024 exchange rates. Merck now expects its full-year non-GAAP effective income tax rate to be between 16.0% and 17.0%, which includes an unfavorable impact related to the one-time charge associated with the acquisition of CN201 (MK-1045) from Curon. Merck now expects its full-year non-GAAP EPS to be between $7.72 and $7.77.

Tailwinds

  • Full-year sales expected to be between $63.6 billion and $64.1 billion.
  • Strong growth, including from KEYTRUDA, new product launches and Animal Health is expected
  • Approximately 2 percentage points of the negative impact of foreign exchange is due to the devaluation of the Argentine peso, which is being largely offset by inflation-related price increases, consistent with practice in that market.
  • Full-year non-GAAP effective income tax rate to be between 16.0% and 17.0%.
  • Full-year non-GAAP EPS to be between $7.72 and $7.77.

Headwinds

  • Includes a negative impact of foreign exchange of approximately 3 percentage points.
  • Includes an unfavorable impact related to the one-time charge associated with the acquisition of CN201 (MK-1045) from Curon.
  • The outlook includes a negative impact of foreign exchange of approximately $0.30 per share.
  • Non-GAAP EPS excludes acquisition- and divestiture-related costs, costs related to restructuring programs, income and losses from investments in equity securities, as well as a tax benefit in 2024 due to a reduction in reserves for unrecognized income tax benefits, resulting from the expiration of the statute of limitations for assessments related to the 2019 federal tax return year.
  • Financial outlook does not assume additional significant potential business development transactions.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2024

Historical avgQ3 2024

-0.4%

Avg return

Earnings day

-0.4%

Avg return

5 days after

+1.4%

Avg return

30 days after

51%

37 / 73 earnings

Positive

+8.0%

Q3 2021

Best reaction

-11.7%

Q3 2017

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+1.0%+2.0%+6.9%
Q4 2025+2.2%+7.6%+2.4%
Q3 2025-1.0%-3.1%+21.1%
Q2 2025+1.2%+1.0%+5.2%
Q1 2025+1.5%+7.6%-1.5%
Q4 2024-9.1%-12.5%-5.8%
Q3 2024-2.8%-3.0%-3.0%
Q2 2024-11.5%-9.8%-8.1%
Q1 2024+3.3%+1.7%+2.0%
Q4 2023+4.7%+5.1%+5.1%
Q3 2023-0.8%-0.9%-1.7%
Q2 2023-0.9%-1.5%+2.2%
Q1 2023+1.8%+3.9%-2.1%
Q4 2022-3.8%-1.2%-0.1%
Q3 2022+2.4%+1.4%+9.2%
Q2 2022-2.1%-4.0%-2.2%
Q1 2022+5.1%+3.2%+10.3%
Q4 2021-4.2%-6.2%-5.1%
Q3 2021+8.0%+9.2%-2.9%
Q2 2021-1.9%-2.5%-2.6%
Q1 2021-3.4%-1.4%-1.6%
Q4 2020-2.0%-2.9%-5.4%
Q3 2020-3.4%-4.6%+1.5%
Q2 2020+4.5%+3.4%+8.4%
Q1 2020-3.8%-7.5%-5.9%
Q4 2019-3.0%-3.1%-7.0%
Q3 2019+4.9%+3.3%+6.6%
Q2 2019+0.6%+2.4%+5.1%
Q1 2019+2.5%+4.2%+3.8%
Q4 2018+3.3%+4.0%+9.7%
Q3 2018-0.2%+3.3%+5.9%
Q2 2018+1.2%+2.3%+7.9%
Q1 2018-2.7%-1.9%+1.1%
Q4 2017-5.8%-6.6%-9.2%
Q3 2017-11.7%-10.7%-12.3%
Q2 2017+0.3%-0.4%-1.2%
Q1 2017+2.0%+2.5%+4.6%
Q4 2016+3.5%+3.4%+7.2%
Q3 2016+0.2%-3.1%+1.5%
Q2 2016+0.4%-1.3%+7.6%
Q1 2016-2.2%
Q4 2015-3.6%
Q3 2015+4.1%
Q2 2015+2.7%
Q1 2015+4.5%
Q4 2014-3.0%
Q3 2014-3.1%
Q2 2014+0.2%
Q1 2014+3.3%
Q4 2013+0.5%
Q3 2013-2.1%
Q2 2013-0.3%
Q1 2013-2.7%
Q4 2012-5.6%
Q3 2012-1.4%
Q4 2011-1.0%
Q2 2012+2.6%
Q1 2012+2.0%
Q3 2011-1.5%
Q2 2011-1.6%
Q1 2011-0.7%
Q4 2010+0.8%
Q3 2010-1.8%
Q2 2010+0.8%
Q1 2009-0.1%
Q1 2010+0.1%
Q4 2009+1.4%
Q4 2007+1.4%
Q3 2009-3.5%
Q3 2008-3.5%
Q2 2008+1.7%
Q2 2009+1.7%
Q4 2008+1.7%

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