Merck & Co (MRK) Q4 2025 earnings summary

Executive summary

• Achieved Q4 2025 sales of $16.4B (up 5% year-over-year) and full-year 2025 sales of $65.0B (up 1%), driven by Oncology, Animal Health, and new product launches, with over 20 new growth drivers in the pipeline.

• Strategic acquisitions of Verona Pharma and Cidara Therapeutics expanded the pipeline and portfolio, including the addition of MK-1406.

• Pipeline advanced with 18 positive Phase 3 trial results and multiple regulatory milestones, including FDA and EC approvals for KEYTRUDA and WINREVAIR.

• Line of sight to over $70B in potential commercial opportunity by mid-2030s, $20B higher than last year, driven by pipeline and new launches.

• Confidence in sustainable long-term growth post-Keytruda LOE, supported by robust pipeline and animal health business.

Financial highlights

• Q4 2025 revenues were $16.4B, up 5% year-over-year; full-year 2025 sales reached $65.0B.

• Q4 non-GAAP EPS was $2.04 (up 19%); GAAP EPS was $1.19 (down 20% due to charges); full-year non-GAAP EPS was $8.98, GAAP EPS $7.28 (up 8%).

• Keytruda family sales rose 5% to $8.4B in Q4; full-year sales reached $31.7B (up 7%).

• Animal Health sales grew 8% in Q4 and 6% for the year, led by livestock products.

• WINREVAIR and CAPVAXIVE contributed $1.4B and $759M in annual sales, respectively.

Outlook and guidance

• 2026 revenue guidance: $65.5B–$67.0B (1–3% growth), including ~1% FX benefit.

• Non-GAAP gross margin expected at ~82%; operating expenses $35.9–$36.9B, including a $9B one-time Cidara charge.

• Non-GAAP EPS guidance: $5.00–$5.15, with a one-time $3.65–$3.95/share charge for the Cidara acquisition.

• Headwinds of ~$2.5B from generic competition, IRA price setting, and lower Lagevrio sales expected.

• $3B in share repurchases planned; continued commitment to dividend growth and disciplined business development.