Dj Amgen Inc. Stock Sheds 4.3%, Underperforms Competitors

Johnson & Johnson’s JNJ first-quarter 2025 earnings came in at $2.77 per share, which beat the Zacks Consensus Estimate of $2.57. Earnings rose 2.2% from the year-ago period.

Adjusted earnings exclude intangible amortization expense and special items and reversal of special charges, which were previously reserved for the bankruptcy resolution. Including these items, reported earnings were $4.54 per share, up 238.8% year over year.

Sales of this drug and medical devices giant came in at $21.89 billion, which marginally beat the Zacks Consensus Estimate of $21.62 billion. (Find the latest earnings estimates and surprises on Zacks Earnings Calendar.)

Sales rose 2.4% from the year-ago quarter, reflecting an operational increase of 4.2% and a negative currency impact of 1.8%. Organically, excluding the impact of acquisitions/divestitures and currency, sales rose 3.3% on an operational basis.

First-quarter sales in the domestic market rose 5.9% to $12.3 billion. Excluding the impact of all acquisitions and divestitures on an adjusted operational basis, domestic sales rose 4.4% in the quarter.

International sales declined 1.8% on a reported basis to $9.59 billion, reflecting an operational increase of 2.1% and a negative currency impact of 3.9%. Excluding the impact of all acquisitions and divestitures on an adjusted operational basis, international sales rose 1.9% in the quarter.

J&J’s Innovative Medicines Unit Outperforms, MedTech Misses

With the complete separation of the Consumer Health segment into a newly listed company called Kenvue KVUE in 2023, J&J has now become a two-sector company focused on the Pharmaceutical and MedTech fields. KVUE will report its first-quarter results in early May.

J&J’s Innovative Medicines segment sales rose 2.3% year over year to $13.87 billion, reflecting a 4.2% operational increase, offset by a 1.9% negative currency impact. Excluding the impact of all acquisitions and divestitures and currency on an adjusted operational basis, worldwide sales rose 4.4%. Innovative Medicines sales beat the Zacks Consensus Estimate of $13.46 billion as well as our model estimate of $13.57 billion.

Higher sales of key products such as Darzalex, Tremfya and Erleada due to strong market growth and share gains drove the segment’s growth. Xarelto and Simponi/Simponi Aria sales also rose in the quarter. New drugs like Carvykti, Tecvayli, Talvey, Rybrevant and Spravato also contributed to growth. The sales growth was partially dampened by lower sales of key drugs, Stelara, Imbruvica, Uptravi, and generic/biosimilar competition to drugs like Zytiga and Remicade.

Sales of blockbuster multiple myeloma medicine Darzalex rose 20.3% year over year to $3.24 billion in the quarter. Sales beat the Zacks Consensus Estimate of $3.13 billion and our model estimate of $3.15 billion.

Sales of the blockbuster psoriasis drug Stelara declined 33.7% to $1.63 billion in the quarter due to the impact of current and potential biosimilar competition. While U.S. sales of Stelara declined 29.8%, international sales declined 38.9% in the quarter. Stelara sales missed the Zacks Consensus Estimate of $1.64 billion as well as our model estimate of $1.66 billion.

A biosimilar version of Stelara was launched in certain European markets for some indications in July 2024. Several biosimilar versions of Stelara are expected to be launched in the United States in 2025. Amgen AMGN launched the first Stelara biosimilar, Wezlana, in January 2025, while Teva Pharmaceutical Industries TEVA launched Selarsdi in February 2025. Both Amgen and Teva had entered into settlement agreements with J&J for their respective biosimilar launches. Stelara biosimilar competition is expected to accelerate throughout 2025 as the number of biosimilar entrants increases.

Imbruvica sales declined 9.5% to $709.0 million. Rising competitive pressure in the United States due to new oral competition has been hurting Imbruvica's sales for the past few quarters. Imbruvica sales were, however, better than the Zacks Consensus Estimate of $678.0 million and our estimate of $703.0

Erleada generated sales of $771.0 million in the quarter, up 11.9% year over year. Erleada sales missed the Zacks Consensus Estimate of $817 million as well as our model estimate of $855.3 million. Tremfya recorded sales of $956.0 million in the quarter, up 18.2% year over year. Tremfya sales beat the Zacks Consensus Estimate of $939.0 million but missed our model estimate of $989.7 million.

New drug Carvykti recorded sales of $369 million compared with $334 million in the previous quarter. Another new drug, Tecvayli, recorded sales of $151.0 million in the quarter, up 13.3% year over year,

J&J began disclosing separate sales of new drugs, Talvey and Rybrevant, from the first quarter of 2025. Sales of Talvey were $86 million, up 48.4% year over year. Rybrevant sales were $141 million compared with $47 million in the year-ago quarter.

Spravato recorded sales of $320.0 million, up 41.9% year over year.

Pulmonary arterial hypertension (PAH) drug Uptravi recorded sales of $451.0 million, down 3.6% year over year. Another PAH drug, Opsumit, recorded sales of $522 million, down 0.5% year over year.

Xarelto sales rose 33.3% in the quarter to $690.0 million. Invega Sustenna/Xeplion/Invega Trinza/Trevicta sales declined 14.5% to $903 million in the quarter. Simponi/Simponi Aria sales rose 18.9% to $659.0 million, while Prezista sales declined 3.7% to $403.0 million. 

Zytiga sales declined 30.9% to $129.0 million in the quarter due to generic competition. Sales of Remicade rose 7.5% in the quarter to $467.0 million.

MedTech segment sales came in at $8.02 billion, up 2.5% from the year-ago period, as an operational increase of 4.1% was offset by a negative currency movement of 1.6%. MedTech segment sales missed the Zacks Consensus Estimate as well as our model estimate of $8.14 billion.

Excluding the impact of all acquisitions and divestitures, and currency, on an adjusted operational basis, worldwide sales rose 1.3%.

Sales in the MedTech business are being driven by new product uptake and commercial execution, which is being partially offset by continued headwinds in Asia Pacific, specifically in China and increased competitive pressure in some MedTech businesses. Sales in China in the first quarter were hurt by the impact of the volume-based procurement (VBP) program. VBP is a government-driven cost containment effort in China.

JNJ Slightly Ups 2025 Sales Guidance, Maintains EPS Range

The company raised its sales expectations for 2025 to reflect the addition of schizophrenia drug Caplyta, following the $14.6 billion acquisition of Intra-Cellular Therapies closed earlier this month.

The sales guidance was raised from a range of $89.2 billion-$90.0 billion to $91.0 billion-$91.8 billion. The Zacks Consensus Estimate stands at $90.22 billion.

The sales range indicates growth in the range of 2.6%-3.6% versus the prior expectation of 0.5%-1.5%. Operational sales growth is expected in the range of 3.3%-4.3% (previously 2.5%-3.5%).

The adjusted operational sales (excluding currency impact, acquisitions/divestitures) growth guidance was maintained in the range of 2.0%-3.0%.

The adjusted earnings per share guidance was maintained in the range of $10.50-$10.70. J&J said that the guidance range includes tariff costs and dilution from the Intra-Cellular Therapies acquisition. The Zacks Consensus Estimate for 2025 earnings is pegged at $10.54 per share.

The earnings range implies growth in the range of 5.2% to 7.2%.

Our Take on JNJ’s Q1 Results

J&J beat first-quarter estimates for both earnings and sales. Despite the loss of exclusivity (“LOE”) of Stelara, its Innovative Medicines unit once again outperformed expectations, with sales of key drugs Darzalex and Tremfya beating estimates. However, Erleada and Uptravi’s sales slightly missed expectations. The Stelara LOE hurt revenue growth by 810 basis points in the quarter.

MedTech unit’s sales also missed estimates. J&J slightly raised its sales guidance while keeping the EPS range intact. J&J also announced a 4.8% increase in its quarterly dividend from $1.24 per share to $1.30 per share

J&J’s shares were down around 1% in pre-market trading on Tuesday. So far this year, J&J’s stock has risen 7.6% against a decrease of 6.0% for the industry.

J&J’s Innovative Medicine unit is showing a growth trend. In 2025, J&J expects growth in the Innovative Medicine segment to be driven by its key products, such as Darzalex, Tremfya, Spravato and Erleada, as well as new drugs like Carvykti, Tecvayli and Talvey, and new indications for Tremfya and Rybrevant.

J&J is also making rapid progress with its pipeline and has been on an acquisition spree lately, which has strengthened its pipeline. 

However, the softness in the MedTech unit, the Stelara patent cliff and the potential impact of Part D redesign will be significant headwinds in 2025. It remains to be seen how the company navigates them. The legal battle surrounding its talc lawsuits has created a bearish sentiment around the stock. The lawsuits allege that its talc products contain asbestos, which caused many women to develop ovarian and some other cancers. Earlier this month, a bankruptcy court in Texas rejected J&J’s proposed bankruptcy plan to settle its talc lawsuits. J&J will go back to the traditional tort system to fight lawsuits individually, using its bankruptcy strategy to settle lawsuits that fail for the third time.

J&J’s Zacks Rank

J&J currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Johnson & Johnson Price and Consensus

Johnson & Johnson price-consensus-chart | Johnson & Johnson Quote

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research

Amgen has an average rating of overweight and mean price target of $314.73, according to analysts polled by FactSet.