Pfizer (PFE) Q3 2021 earnings summary

Executive summary

• Q3 operational revenue growth was 130%; excluding Comirnaty direct sales and alliance revenue, operational growth was 7%.

• Innovative medicines and vaccines reached nearly 1 billion people in 9M 2021; excluding Comirnaty, nearly 300 million people.

• 2021 revenue and adjusted EPS guidance increased, primarily on higher Comirnaty expectations.

Financial highlights

• Q3 reported diluted EPS grew 445% and adjusted diluted EPS grew 129%; FX contributed 4%, or $0.02, to adjusted EPS.

• Excluding Comirnaty, operational revenue growth was 7%, with 12% volume growth offset by a 5% price impact; Chantix reduced growth by ~2%.

• Adjusted cost of sales reduced Q3 gross margin by ~22 percentage points YoY, almost entirely due to Comirnaty.

• Adjusted SI&A increased as promotional spending and sales-force activity moved closer to pre-pandemic levels; adjusted R&D rose on COVID-19 and pipeline investments.

Outlook and guidance

• 2021 total revenue guidance rose to $81.0–$82.0B; Comirnaty revenue is expected to be ~$36B, or 44% of revenue at the midpoint.

• 2021 adjusted diluted EPS guidance increased to $4.13–$4.18, representing 84% growth at the midpoint vs. 2020, including an expected 4% FX benefit.

• Excluding Comirnaty, 2021 revenue guidance is $45–$46B, or ~6% operational growth at the midpoint; adjusted diluted EPS is $2.60–$2.65, or ~12% operational growth.

• 2022 Comirnaty revenue is expected to be ~$29B, reflecting revenues for 1.7B doses; production capacity is 4B doses.

• Long-term outlook remains at least 6% risk-adjusted revenue CAGR through 2025 and double-digit bottom-line growth; projections exclude Comirnaty and business development impacts.