Merck & Co (MRK) Q3 2025 earnings summary

Executive summary

• Q3 2025 revenue reached $17.3B, up 4% year-over-year, driven by oncology, animal health, and new product launches including WINREVAIR, CAPVAXIVE, ENFLONSIA, and the addition of OHTUVAYRE via the Verona Pharma acquisition.

• Robust pipeline with approximately 80 Phase 3 trials and significant regulatory milestones, including approvals for KEYTRUDA QLEX and WINREVAIR.

• Significant investments in U.S. manufacturing and R&D, with a $70B plan for expanded operations beginning in 2025.

• Net income for Q3 2025 was $5.8B (GAAP), up from $3.2B in Q3 2024; non-GAAP net income was $6.4B.

Financial highlights

• Q3 2025 revenue: $17.3B, up 4% year-over-year (3% ex-FX); Oncology sales led by KEYTRUDA up 10% to $8.1B; WINREVAIR sales surged 141% to $360M.

• GARDASIL/GARDASIL 9 sales declined 24–25% to $1.7B, mainly due to lower demand in China and Japan; CAPVAXIVE sales reached $244M; ENFLONSIA launch generated $79M.

• Animal Health sales up 7–9% to $1.6B, with livestock up 14–16% and companion animal down 2–3%.

• Gross margin improved to 81.9% (non-GAAP) and 77.7% (GAAP); Q3 EPS was $2.58 (non-GAAP, up 64%) and $2.32 (GAAP, up 87%).

Outlook and guidance

• 2025 full-year revenue guidance: $64.5–$65.0B, with non-GAAP EPS of $8.93–$8.98; guidance reflects Verona Pharma acquisition and FX headwinds.

• Operating expense growth expected to accelerate in 2026 due to increased R&D and SG&A investments, including over $500M for OHTUVAYRE.

• Anticipates continued negative impact from global pricing pressures, U.S. healthcare reforms, and government price-setting programs.