Pfizer (PFE) reported Q2 results that exceeded estimates. The pharmaceutical and biotech major reported adjusted diluted earnings of $0.60 per share in the second quarter, a decline of 11% year-over-year, which beat analysts’ consensus estimate of $0.46 per share.
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PFE’s Q2 Revenue Breakdown
Sales increased by 3% year-over-year, with revenue hitting $13.3 billion. This beat analysts’ expectations of $12.96 billion. More importantly, Pfizer reported its first topline revenue growth since the fourth quarter of 2022, following a peak in revenue from its COVID vaccines.
The company’s CFO and EVP, David Denton, commented that the second quarter demonstrated “strong 14% operational revenue growth of our non-COVID products in the second quarter,” which showed its “continued focus on commercial execution.”
Pfizer’s sales of COVID vaccine, Paxlovid, rose 76% to $251 million, driven by increased international demand. However, the sales of its other COVID vaccine, Comirnaty, saw revenue fall 87% year-over-year to $195 million due to declining demand in international markets and lower contractual deliveries.
Pfizer’s Cost-Cutting Initiatives
Pfizer is working to stabilize its business amid falling demand for COVID products. Last year, the company initiated a cost-cutting plan aiming for $4 billion in savings by the end of this year. In addition, Pfizer has announced a separate multi-year plan to cut costs that aims to deliver savings of $1.5 billion by 2027.
PFE’s FY24 Outlook
Looking forward, Pfizer raised its FY24 forecast by $1 billion to be in the range of $59.5 billion to $62.5 billion and raised its adjusted earnings guidance by $0.30 to be between $2.45 and $2.65 per share. The raised guidance now reflects projected revenues of $8.5 billion from Comirnaty and Paxlovid vaccines.
The company has projected adjusted earnings in the range of $2.45 to $2.65 per share in FY24, up from its prior outlook of $2.15 to $2.35 per share. For reference, analysts were expecting earnings of $2.37 per share on revenues of $60.6 billion.
Is Pfizer a Buy, Hold, or Sell?
Analysts remain cautiously optimistic about PFE stock, with a Moderate Buy consensus rating based on seven Buys and eight Holds. Year-to-date, PFE has increased by more than 10%, and the average PFE price target of $33.83 implies an upside potential of 10.1% from current levels. These analyst ratings are likely to change following PFE’s results today.
