Eli Lilly & Co. has delivered a stellar performance in its second-quarter results, which has sent its shares surging by as much as 14%, marking the most significant intraday gain in a year.
The pharmaceutical giant’s strong results were driven primarily by its weight-loss therapy, Zepbound, which significantly outperformed expectations.
Lilly’s revenue for the second quarter reached $11.3 billion, a remarkable 36% increase year-over-year, comfortably beating the consensus estimate of $9.98 billion. The company’s adjusted earnings per share (EPS) also saw a dramatic rise to $3.92, compared to $2.11 in the same period last year. This robust performance led Lilly to revise its full-year revenue forecast upwards to a range of $45.4 billion to $46.6 billion, from the previous estimate of $42.4 billion to $43.6 billion. Similarly, the adjusted EPS forecast was raised to between $16.10 and $16.60, well above the previous consensus of $13.71.
The key drivers of this impressive growth were the diabetes and obesity treatments Mounjaro and Zepbound, along with cancer drug Verzenio. Mounjaro alone generated $3.09 billion in revenue, significantly exceeding the $2.37 billion estimate. Zepbound, another standout performer, brought in $1.24 billion, against expectations of $818.9 million. The strong sales of these drugs have been bolstered by higher realised prices in the US market and improved product availability.
Looking ahead, Eli Lilly’s growth path appears robust, with the company raising its full-year guidance, reflecting confidence in continued strong performance. However, the market will be closely monitoring the sustainability of its operating margin progression, especially as Lilly balances the need for investment in new launches and ongoing research and development.
As a reminder, LLY’s inclusion in the US Growth Portfolio is based on share price momentum, and while LLY’s continues to outperform peers on a relative basis, it will remain within the portfolio.
