AstraZeneca (AZN) Q1 2025 earnings summary

Executive summary

• Total revenue grew 10% year-over-year at constant exchange rates (CER) to $13.5bn–$13.6bn in Q1 2025, with broad-based growth across therapy areas and geographies.

• Core EPS increased 21% year-over-year to $2.49, reflecting strong operational leverage and margin expansion.

• 13 regulatory approvals and five positive phase III results, including two NMEs, were secured across key regions.

• The company is on track to deliver at least 20 NMEs by 2030, with nine already approved.

• Significant investments in transformative technologies, R&D, and manufacturing, especially in the US and China, support long-term growth.

Financial highlights

• Product revenue grew 10% at CER to $13,514m; alliance revenue up 42% to $639m.

• Gross margin was 84%, benefiting from product mix and favorable FX; core operating profit margin reached 35%.

• Core R&D costs were 23% of revenue; core SG&A costs rose 4%, below revenue growth.

• Net cash inflow from operations was $3.7bn, up 49% year-over-year; CapEx was $500m, expected to rise 50% in 2025.

• Net debt increased by $1.5bn to $26.1bn, mainly due to a $3.3bn dividend payment.

Outlook and guidance

• FY 2025 guidance reiterated: high single-digit percentage revenue growth and low double-digit percentage Core EPS growth at CER.

• Core tax rate expected between 16–22%; adverse FX impact on revenue and Core EPS anticipated to be low single-digit percentage.

• Gross margin expected to decline 60–70 bps in 2025 due to U.S. Part D redesign, China VBP, biosimilar competition, and increased profit share.

• Sustained growth anticipated across all therapy areas and geographies, with global demand expected to offset known headwinds.

• On track for $80bn total revenue ambition by 2030 and mid-30s% Core operating margin by 2026.