Pfizer Inc. (NYSE:PFE) revealed its fourth-quarter earnings for 2024 on February 4, reporting revenues and adjusted earnings per share significantly above Wall Street's expectations. This strong financial performance was predominantly fueled by sales from non-COVID-19 products, indicating the pharmaceutical giant's efforts to pivot away from dependence on pandemic-related products.
For the fourth quarter, Pfizer's revenue reached $17.8 billion, marking a 22% increase compared to $14.6 billion during the same period last year. This performance exceeded analysts’ estimates of $17.28 billion, reflecting significant operational growth.
“2024 was a strong year of execution and performance for Pfizer, wherein we met or exceeded our strategic and financial commitments,” stated CEO Albert Bourla. He noted the company made substantial progress, particularly from their Seagen acquisition, contributing $3.4 billion to the total revenue as several products demonstrated strong growth.
For FY 2024, Pfizer reported total revenues of $63.6 billion—up 7% from 2023—dispatching earnings per share of $3.12, also above the expected $2.97. This performance demonstrates Pfizer's successful maneuver through the post-COVID market dynamics.
Despite the upward trends, Pfizer acknowledges challenges, particularly as demand for its COVID-19 products, particularly the vaccine Comirnaty and antiviral Paxlovid, faces declines. Sales from Comirnaty fell to $3.38 billion, dropping 38% operationally from last year, reflective of fewer vaccination rates globally. Paxlovid, on the other hand, saw revenues of $727 million, reversing the previous year’s significant revenue decline caused by one-time accounting adjustments.
To navigate these headwinds, Pfizer is implementing substantial cost-cutting measures, projected to save approximately $4.5 billion by the end of 2025. CFO David Denton expressed satisfaction with the execution of the company’s cost realignment program, which has already yielded approximately $4 billion net savings. “We are on track to deliver these savings and are confident of returning to pre-pandemic operating margins,” Denton revealed.
Investors appeared cautiously optimistic post-earnings, with Pfizer’s stock rising initially by 2.6% before fluctuated as broader market sentiments took hold. The stock has struggled, trading significantly lower than its pandemic peak, yet recent results have prompted some analysts to forecast hope for a turnaround, particularly with investment strategies directed at future growth.
Analysts are closely watching Pfizer's pipeline, especially following the acquisition of Seagen. The company is focused on maximizing returns from several new oncology drugs, including Padcev, which garnered $444 million this quarter, close to analyst expectations.
Bourla accentuated the importance of sharpening their R&D productivity to bolster future revenue streams. With three drugs undergoing Medicare price negotiations, including the breast cancer medication Ibrance and prostate cancer drug Xtandi, Pfizer will need to balance these challenges against its growth ambitions.
Looking forward, Pfizer has reasserted its financial guidance for 2025, projecting adjusted earnings per share between $2.80 and $3.00, and revenues to fall between $61 and $64 billion. This outlook underlines the firm's commitment to delivering value through operational efficiencies and strategic growth.
While the company faces uncertainties surrounding future regulatory environments and market dynamics, particularly under the new U.S. administration, Bourla expressed optimism about engaging positively with stakeholders, stating, “the opportunities for the pharmaceutical industry probably outweigh the risks.”
Pfizer is clearly at a crossroads, transitioning its focus back to core non-COVID products and managing changes resulting from both operational synergies and financial headwinds. The upcoming year promises both challenges and prospects, as the company seeks to stabilize and grow beyond the pandemic era.