Robust Earnings Boosted by GLP-1 Sales
Eli Lilly and Company (NYSE:LLY) reported significantly better-than-expected earnings on Thursday, with revenue surpassing Wall Street estimates by 13%, reaching $11.3 billion for the second quarter. This represents a 36% increase in revenue from the previous year, primarily driven by GLP-1 drugs Mounjaro and Zepbound, which generated $4.3 billion in sales. This exceeded Wall Street’s consensus of $3.2 billion. The sales boost comes as the U.S. Food and Drug Administration (FDA) removed both drugs from its shortage list, indicating that Lilly’s supply issues have been resolved. Consequently, Lilly raised its full-year revenue forecast for the second time this year, increasing its guidance from the previously set range of $40.4 billion to $41.6 billion to a new range of $45.4 billion to $46.6 billion.
The company’s stock surged more than 10% on the news Thursday morning.
Positive Future Outlook for GLP-1 Market
Mizuho’s health sector expert Jared Holz noted that the earnings beat should alleviate any concerns about the pace of GLP-1 drug adoption. Holz remarked that it is unusual to see such strong results from a large-cap pharmaceutical company like Eli Lilly.
Looking ahead, Eli Lilly is focusing on advancing a pill form of the GLP-1 drug, orforglipron, currently in clinical trials, and exploring additional use cases for its existing drugs. These developments could lead to increased adoption and sales of its injectable GLP-1s. The company has already applied for Zepbound to treat sleep apnea in the U.S. Expanding the use cases for GLP-1 drugs could also lead to broader insurance coverage, as many large payers currently do not cover the drugs for weight loss alone.
JPMorgan analyst Chris Schott emphasized that Eli Lilly’s recent performance is not a one-time event. Schott highlighted that Eli Lilly remains one of JPMorgan’s top picks in the sector, anticipating further upside to street estimates as injectable capacity increases, orforglipron becomes available, and data supports the broader use of obesity medications.
Featured Image: Megapixl
Author Faith Yakubu 
