Eli Lilly Surges Past $1 Trillion Mark After Blowout Quarter

Eli Lilly, the pharmaceutical powerhouse long known for its innovations in diabetes and obesity treatments, has once again captured Wall Street’s attention. On February 4, 2026, shares of Eli Lilly soared by as much as 10%, pushing the company’s market capitalization above the coveted $1 trillion mark—a milestone it last reached in January, according to Barron’s and Dow Jones Market Data. The dramatic surge came on the heels of a fourth-quarter earnings report that not only exceeded analyst expectations but also set a bullish tone for the year ahead.

The numbers, frankly, were jaw-dropping. Eli Lilly posted adjusted earnings per share of $7.54 for the fourth quarter of 2025, easily beating the $6.91 consensus estimate tracked by FactSet. Revenue for the quarter came in at $19.3 billion, marking a 43% jump from the same period a year earlier and surpassing the expected $17.9 billion. The company’s impressive performance was largely fueled by soaring demand for its blockbuster drugs Mounjaro and Zepbound, both of which are based on the active ingredient tirzepatide and are revolutionizing the treatment of type 2 diabetes and chronic weight management.

To put the growth in perspective, Zepbound sales reached $4.3 billion in the fourth quarter of 2025, a 123% increase from the $1.9 billion reported in the same period the previous year, according to MarketWatch. Mounjaro wasn’t far behind, racking up $7.4 billion in sales—a 110% year-over-year leap. Combined, these two drugs generated $11.7 billion in quarterly revenue, smashing the $10.4 billion FactSet estimate. The impact on investor sentiment was immediate: Eli Lilly’s stock price surged to $1,106, and the company’s market cap topped $1.05 trillion, as reported by Barron’s.

But the company isn’t resting on its laurels. For the full year 2026, Lilly projects revenue between $80 billion and $83 billion, well above the $77.6 billion consensus estimate. Adjusted earnings are expected to land between $33.50 and $35 a share, outpacing Wall Street’s $33.04 target. The midpoint of Lilly’s revenue guidance implies a robust 25% sales growth for the year. Analysts at Truist Securities reiterated a Buy rating, setting a price target of $1,182, while UBS and Bernstein echoed the bullish sentiment with targets of $1,250 and $1,300, respectively, according to Investing.com.

CEO Dave Ricks offered insights into the company’s strategy during an exclusive interview with CNBC. He emphasized that upcoming government Medicare coverage of obesity treatments is poised to expand the U.S. market for these drugs in 2026, calling it a “big multiplier on the eligible pool” of patients. The company is also banking on continued worldwide demand for Mounjaro and Zepbound, as well as the anticipated U.S. launch of its oral GLP-1 pill, orforglipron, pending approval in the second quarter of the year. Regulatory submissions for orforglipron have already been filed in the U.S., Japan, and the European Union, signaling Lilly’s intent to stay ahead of rivals in the increasingly competitive obesity and diabetes drug markets.

Despite these tailwinds, Lilly is not immune to headwinds. The company acknowledged it will face a global pricing decline in the low- to mid-teens percentage range, primarily due to a pricing deal struck with the Trump administration. Under this agreement, both Eli Lilly and its main competitor, Novo Nordisk, will slash prices for Medicare and Medicaid beneficiaries and offer discounted rates to consumers via the forthcoming TrumpRx direct-to-consumer platform. In exchange, the companies receive a three-year exemption from tariffs. CEO Ricks was candid about the impact: “There will be a step down in pricing early this year,” he told CNBC, but he expects “volume growth of the company’s drugs will ramp on the back half of the year.”

The competitive landscape remains fierce. Novo Nordisk, Lilly’s closest rival, recently warned of a 5% to 13% sales decline in 2026, citing increased competition and the expiration of exclusivity for its blockbuster drugs in key international markets. Novo’s U.S.-listed shares plummeted 14% after the announcement, and the stock dropped another 4.7% following Lilly’s report, as noted by Barron’s. In contrast, Lilly’s share of the U.S. obesity and diabetes drug market rose to 60.5% in the fourth quarter of 2025, up 2.6 percentage points from the previous quarter, while Novo Nordisk held 39.1%.

Wall Street’s enthusiasm for Lilly is also reflected in its financial metrics. The company’s revenue grew 45.41% over the past twelve months, and its incretin portfolio—which includes both Mounjaro and Zepbound—has been a key driver. According to Investing.com, Lilly trades at a P/E ratio of 49.16, a figure seen as justified by its robust growth trajectory and strong pipeline. InvestingPro data gives Lilly a “GREAT” overall financial health score, and the stock is viewed as slightly undervalued given its low PEG ratio relative to earnings growth.

Looking ahead, Lilly is making strategic investments to secure its dominance. The company announced plans to invest over $3.5 billion in a new manufacturing facility in Lehigh Valley, Pennsylvania. The plant, expected to be operational by 2031, will focus on producing next-generation weight-loss medicines and is projected to create 850 permanent jobs.

It’s not just about obesity and diabetes, though. Lilly’s diversified portfolio includes treatments in oncology, such as Verzenio for breast cancer, which saw worldwide revenue grow 3% to $1.6 billion in the fourth quarter. While U.S. sales for Verzenio slipped 4%, international sales climbed 18%, highlighting the company’s global reach.

Of course, challenges remain. The market for weight-loss drugs is evolving rapidly, with competitors exploring oral medications and once-monthly injections—potentially more convenient alternatives to Lilly’s current once-weekly regimen. To stay ahead, Lilly is pushing hard on its own oral therapy, orforglipron, and has already adjusted its pricing structure to make its products more accessible. For example, the lowest dose of Zepbound is now available to cash-paying patients for $299 a month, while the oral orforglipron will cost $149 at the lowest dose, once approved.

All told, Eli Lilly’s blockbuster quarter and confident guidance have not only silenced the skeptics but also reinforced its position as the market leader in obesity and diabetes treatments. As the company navigates pricing pressures and intensifying competition, its strategic bets on innovation, manufacturing, and market expansion appear to be paying off—at least for now.