Merck Slashes Profit Outlook Despite Sales Surge

Merck announced a significantly reduced profit forecast for 2026, citing substantial charges from recent acquisitions. The company now anticipates adjusted earnings per share to range between $2.66 and $2.76, a considerable drop from earlier projections of $5.04 to $5.16. These revised figures include one-time charges of $2.31 per share for the Terns Pharmaceuticals acquisition and $3.62 per share from the Cidara Therapeutics deal.

Concurrently, Merck bolstered its sales outlook, expecting full-year revenue between $66.3 billion and $67.3 billion, an increase from the previous $65.8 billion to $67 billion range. The second quarter saw a net loss of $1.34 billion ($0.54 per share), a reversal from the prior year's net income. This quarterly loss was primarily driven by a $5.7 billion charge related to the Terns acquisition.

Revenue for the second quarter reached $16.61 billion, marking a 5% year-over-year increase and surpassing analyst expectations. Key product sales contributed to this growth, with Keytruda and its new injectable form, Keytruda Qlex, jointly generating $8.37 billion. Winrevair, a pulmonary arterial hypertension therapy, saw its sales climb 75% to $588 million, while the Capvaxive vaccine brought in $184 million, up 42%. The animal health segment also advanced by 8% to $1.78 billion.

Further underscoring its product pipeline, Merck received FDA approval in July for Lipfendra, a new once-daily oral PCSK9 inhibitor designed to lower LDL cholesterol in adults with hypercholesterolemia.