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Pfizer It forecast modest guidance for 2026 on Tuesday as it looks for longer-term investments in its portfolio to offset waning sales of Covid products and the decline of older drugs.
Those hurdles are neither surprising nor new for Pfizer, which has seen a dramatic drop in vaccine and antiviral sales after posting record revenue during the pandemic. The drugmaker has pursued deals of all sizes in recent years to generate new revenue streams, such as the recently closed $10 billion acquisition of obesity biotech Metsera and a whopping $43 billion for cancer drug maker Seagen in 2023.
But the guide emphasizes that these investments are still far from bearing fruit. Metsera, for example, offers a portfolio of drugs that are still in an early stage of development.
The company's shares fell nearly 5% on Tuesday. The stock is also down about 5% for the year.
The pharmaceutical company expects adjusted earnings to be between $2.80 and $3 per share next year. That's slightly below analysts' consensus estimate of $3.05 per share for the year, according to LSEG.
Revenue is expected to total between $59.5 billion and $62.5 billion, which would be largely flat compared to Pfizer's new 2025 sales guidance of $62 billion. Analysts expected 2026 sales of $61.59 billion, according to LSEG estimates.
The company said the lackluster revenue outlook is partly due to declining sales of its Covid vaccine and antiviral pill Paxlovid. Pfizer predicts that sales of these products in 2026 will fall by about $1.5 billion year over year, to $5 billion.
Pfizer also noted another expected drop of about $1.5 billion year-over-year in sales as certain products lost their market exclusivity. Some blockbuster drugs, such as the company's Prevnar pneumonia vaccine, face increased competition from rivals.
Pfizer's patent expirations are expected to occur primarily in 2026 and 2028, the company's chief financial officer, Dave Denton, said in an investor call on Tuesday. He said the drugmaker expects $17 billion in revenue to be affected by patent expirations and regulatory exclusivity.
The blood thinner Eliquis, one of the company's best sellers, will also have lower prices in Medicare starting next year after negotiations with the government as part of the Inflation Reduction Act. Some analysts also noted that the guidance likely reflects costs tied to the company's recent acquisitions, including Metsera.
In a note Tuesday, JPMorgan analyst Chris Schott called the outlook “largely expected.” He said Covid headwinds and investments in research and development will be partially offset by the company's ongoing restructuring.
In an investor call Tuesday, Pfizer said it surpassed its cost savings goals for 2025. The company is targeting more than $7 billion in cost cuts by 2027, and said Tuesday it expects to achieve most of those savings by next year.
Meanwhile, BMO Capital Markets analyst Evan Seigerman said the slightly lower outlook for 2026 “leaves room [for] “Adjustments in light of uncertainty over vaccine policy”.
Pfizer and other drugmakers have had to contend with changes to U.S. vaccine policy under Health and Human Services Secretary Robert F. Kennedy Jr., a prominent vaccine skeptic.
“Given the uncertainty with HHS policy and infection rates, we appreciate the conservative estimates and cost savings…heading into the new year,” Seigerman said.
On the call, Pfizer CEO Albert Bourla said the Food and Drug Administration's comments about the shots “have no merit” and “are not going to change the way we look at our long-term investments in vaccines.” Bourla did not comment specifically, but said he believes “this anomaly will correct itself.”
Earlier this year, Pfizer reached a landmark drug pricing deal with the Trump administration, including selling its existing drugs to Medicaid patients at the lowest price offered in other developed nations. Pfizer will also guarantee the same “most favored nation” pricing on its new drugs for Medicare, Medicaid and commercial payers.
In exchange, the company will get a three-year exemption from President Donald Trump's targeted pharmaceutical tariffs.
Denton said there is “price compression and margin compression built in” to the company's guidance for 2026 as it plans to offer “deeper discounts” on its Medicaid business as part of the deal with Trump.
