JNJ beats Q1 estimates, raises 2026 guidance as ex‑STELARA growth runs double‑digit

 

• Fiscal Q1 2026 non‑GAAP EPS and revenue both beat consensus estimates.
• Q1 sales $24.1B rose 10% YoY and grew 6.4% operationally; excluding STELARA headwind, enterprise grew double digits.
• Adjusted EPS $2.70 declined 2.5% YoY, pressured by heavier launch spend, tariffs, and adverse mix.
• Company lifts quarterly dividend 3.1% to $1.34, adding to shareholder returns alongside earnings and guidance update.
• Innovative Medicine sales $15.4B grew 7.4%; ex‑STELARA, segment grew ~16% with 10 brands double‑digit.
• Immunology strong: TREMFYA up 63.8% while STELARA fell 61.7% from biosimilar and novel‑class competition.
• ICOTYDE oral IL‑23 launched strongly, ~1,500 prescriptions and >1,000 prescribers already; viewed as potential mega‑blockbuster.
• Oncology momentum: DARZALEX $4B (+18%), CARVYKTI ~$600M (+57%), RYBREVANT combo $257M (+81%).
• MedTech grew 4.6% led by cardiovascular (Abiomed +14%, Shockwave +18%, electrophysiology +10%); surgery modest at 1.2%.
• Segment margins compressed: Innovative Medicine margin 39.7% and MedTech 22.3%, both down ~280–360 bps YoY.
• 2026 operational sales growth guidance raised to 5.9–6.9% (midpoint ~$100.2B); adjusted EPS to $11.30–11.50.
• Management reiterates line of sight to double‑digit growth by decade‑end without assuming further M&A.
• Main concern: Margin pressure and STELARA erosion as JNJ steps up investment behind multiple major launches.
• Strong quarter, driven by broad-based ex‑STELARA growth and robust uptake of new high-value products.

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