Gilead Sciences (GILD 1.27%), a biopharmaceutical company known for its innovations in HIV and hepatitis C treatments, released its earnings report for the first quarter of 2024 on April 25. The company reported a non-GAAP diluted loss of $1.32 per share, outperforming analysts' expectations for a loss of $1.49 per share. Its Q1 revenue grew 5% year over year to $6.69 billion, compared to the analysts' average expectation of $6.36 billion.
Despite management's decision to take a write-down on acquired in-process research and development assets from its purchase of CymaBay Therapeutics, which closed in March, Gilead's financial performance and sector-leading HIV product sales depict a robust quarter overall.
| Metric | Q1 2024 | Estimates | Q1 2023 | % Change |
|---|---|---|---|---|
| Total revenue | $6.69 billion | $6.36 billion | $6.35 billion | 5% |
| Non-GAAP diluted EPS | ($1.32) | ($1.49) | $1.37 | N/A |
| HIV product sales | $4.34 billion | N/A | $4.19 billion | 4% |
| Oncology sales | $789 million | N/A | $670 million | 18% |
| Liver disease sales | $737 million | N/A | $675 million | 9% |
Understanding Gilead Sciences
Gilead Sciences is a pioneer in the biopharmaceutical industry, focusing on life-saving treatments for HIV, hepatitis, oncology, and inflammatory and respiratory diseases. Its HIV treatments dominate that market, and it continues to research and develop new therapies to combat viral diseases. Its acquisition of CymaBay Therapeutics -- which brought the promising liver disease treatment candidate Seladelpar into its portfolio -- underscores its commitment to expanding its therapeutic footprint.
The company's financial strength is largely attributable to its HIV product lineup, led by Biktarvy and Truvada, and its burgeoning oncology division, which is spearheaded by Trodelvy. This strategic diversity positions Gilead for sustainable growth amid evolving healthcare challenges.
Quarterly highlights
Gilead's key HIV, liver disease, and oncology segments showed notably strong Q1 performances, with new launches and global expansion fueling its sales. Sales of Biktarvy, its leading HIV treatment, rose 10%, highlighting Gilead's continued dominance in this niche. Its 18% year-over-year growth in oncology sales reflected the company's success in expanding its cancer treatment portfolio.
It also took a significant impairment charge on in-process research and development from its CymaBay acquisition -- a purchase made to diversify and strengthen its long-term pipeline. Despite that write-down, the company's overall sales growth and operational adjustments exhibit a solid business trajectory.
Looking ahead
Gilead's management adjusted its full-year EPS outlook downward, attributing those changes primarily to the financial impacts of its recent acquisition. Previously, it was forecasting non-GAAP (generally accepted accounting principles) diluted EPS in the $6.85 to $7.25 range. Now, it's guiding for a $3.45 to $3.85 range. It kept its product sales outlooks steady, however, signaling confidence in the continuing strength of its core business. Investors should keep a particular eye on how Gilead's integration of CymaBay progresses, and watch for developments from its pipeline.
Given the strategic significance of Gilead's R&D investments and pipeline development, stakeholders should also pay attention to upcoming trial results and news regarding regulatory approvals. These factors, combined with market dynamics in the HIV and Oncology segments, will be crucial in determining Gilead's performance in the forthcoming quarters.
