Gilead Sciences Inc. late Thursday swung to a quarterly profit and reported rising sales thanks to its COVID-19 drug, but a revenue drop from two of its HIV drugs and ongoing concerns about the pandemic dragged the stock lower.
said it earned $1.52 billion, or $1.21 a share, in the second quarter, contrasting with a loss of $3.3 billion, or $2.66 a share, in the year-ago quarter. Adjusted for one-time items, the company earned $1.87 a share.
The drug maker said its revenue rose 21% to $6.2 billion, mostly on Veklury, the brand name of remdesivir, which is used in the treatment of COVID-19, as well as “higher demand” for drugs treating HIV and hepatitis.
Without Veklury, sales rose 5% to $5.3 billion, Gilead said. Sales of the COVID-19 drug reached $829 million.
Analysts polled by FactSet expected the company to report adjusted earnings of $1.74 a share on total sales of $6.08 billion. The stock fell 2% after ending the regular trading day down 0.3%.
Sales of Truvada and Atripla, antiviral medications used to treat HIV, fell 72% and 42%, respectively, Gilead said. That reflects the arrival of generics after the drugs’ loss of exclusivity in the U.S. in late 2020.
Gilead guided for product sales between $24.4 billion and $25 billion for the full year 2021, compared with a previous expectation of product sales between $23.7 billion and $25.1 billion, “reflecting solid results in the first half of the year and our updated expectations for the second half of 2021.”
Excluding Veklury, Gilead tweaked the top of the range for its 2021 product sales guidance to between $21.7 billion and $21.9 billion, compared with an earlier outlook calling for sales between $21.7 billion and 22.1 billion, “primarily reflecting the longer than expected pandemic impact on our HIV business, including the latest increase in COVID-19 cases.”
It called for total Veklury sales between $2.7 billion and $3.1 billion for the year, compared with a forecast of sales between $2 billion to $3 billion, thanks to “the ongoing role of Veklury in the pandemic, in addition to the continued uncertainties around the path of the pandemic since Veklury revenue tends to track hospitalization rates.”
Gilead also guided for adjusted EPS between $6.90 and $7.25, compared to a range between $6.75 and $7.45 previously.
Research and development costs dropped to $1.1 billion in the quarter, compared with $1.3 billion a year ago reflecting the wind-down of remdesivir-related programs, partly offset by increases in other clinical activities, the company said.