Pfizer stock sank early Tuesday after the pharma giant unexpectedly reported a fourth-quarter profit despite missing sales expectations.
During the December quarter, Pfizer earned 10 cents per share, beating forecasts for an 18-cent loss per share. Earnings tumbled 91% year over year. Sales also plunged 41% to $14.25 billion and missed projections for $14.37 billion.
"The stronger bottom line was tied to much better-than-expected gross margins and substantially lower (research and development spending) as the company slashed costs," Third Bridge analyst Lee Brown said in an email to Investor's Business Daily.
He noted research and development costs declined 23% year over year and undercut expectations by 36%.
Meanwhile, the lion's share of the sales downfall was due to a continual, and expected, decline in sales of Covid products. Excluding the vaccine and oral antiviral, Pfizer's total sales climbed 8% operationally, Chief Financial Officer David Denton said in a written statement.
On today's stock market, Pfizer stock fell 1.7% to 27.02.
Pfizer Stock: Prevnar, Oncology Misses
There were puts and takes across the board from Pfizer's biggest moneymakers.
Bearishly, revenue from pneumococcal vaccine Prevnar slipped 8% to $1.61 billion and missed projections by 20%, Third Bridge's Brown said. The company blamed the sales decline on lower demand and unfavorable timing of customer orders.
On the flip side, Pfizer reported $1.61 billion in sales of blood thinner Eliquis, which it developed with Bristol Myers Squibb. Eliquis sales grew 9% and topped Pfizer stock analysts' forecast by 5%.
Brown noted Eliquis lost patent protection abroad — a phenomenon which is about to repeat in the U.S. Further. Medicare officials will soon negotiate the price they'll pay for Eliquis. "So our longer-term excitement for the drug is tempered," he said.
Also on a promising note, Pfizer's new vaccine for respiratory syncytial virus, or RSV, generated $515 million in sales. That shot, Abrysvo, competes against GSK's Arexvy. The Vyndaqel drugs, which treats the buildup of abnormal plaque on the heart, brought in a total $961 million, surging 41% and narrowly beating forecasts.
But Leerink Partners analyst David Risinger noted that sales from cancer drugs came in 4% light due to shortfalls from Ibrance and Xtandi.
Pfizer reiterated its outlook for the year, which calls for steep declines. The company projects adjusted earnings of $2.05 to $2.25 per share and $58.5 billion to $61.5 billion in sales.
Follow Allison Gatlin on X, the platform formerly known as Twitter, at @IBD_AGatlin.
