Gilead stock dipped Friday after beating second-quarter expectations on the back of stronger-than-expected sales of non-core products.
Though the company's biggest moneymaker, an HIV treatment called Biktarvy, narrowly topped Street forecasts, the lion's share of the beat came from better-than-expected sales of hepatitis C drugs and Veklury, Gilead Sciences' Covid treatment.
But RBC Capital Markets analyst Brian Abrahams noted these are "not core long-term drivers."
On today's stock market, Gilead stock fell 2.6% to 73.66.
Gilead Stock: Sales, Earnings Beat
Total product sales — which excludes other sources of revenue like royalties — increased 5% to $6.91 billion. Excluding revenue from Covid treatment Veklury, which saw a 16% decline, total product sales rose 6%. Analysts called for $6.67 billion in product sales.
Gilead also earned an adjusted $2.01 per share, beating expectations and growing from $1.34 a share in the year-earlier period.
Importantly, Biktarvy sales beat expectations, rising 8.5% to $3.2 billion. Analysts called for a slightly lower $3.18 billion in sales. The biotech company is also looking ahead to lenacapavir, its once-every-six-months shot to prevent HIV.
"Gilead believes twice-yearly injectables could possibly 'redefine' the market," Mizuho Securities analyst Salim Syed said in a report. He has an outperform rating on Gilead stock.
Cancer Treatments Mixed
Meanwhile, cancer treatments proved a mixed bag. Revenue from cell therapies Tescartus and Yescarta topped expectations with a respective $107 million and $414 million. But sales of breast cancer treatment Trodelvy came in light at $320 million, though grew more than 23%.
Gilead kept its sales outlook for $27.1 billion to $27.5 billion. Analysts following Gilead stock projected $27.4 billion in product sales. The company boosted its adjusted earnings outlook by 10 cents at the midpoint to $3.60 to $3.90 per share. The Street called for $3.76.
Gilead stock is forming a cup-with-handle base with a buy point at 78.45, according to MarketSurge.
Follow Allison Gatlin on X, the platform formerly known as Twitter, at @IBD_AGatlin.
