Eli Lilly has recently announced a significant upward adjustment to its full-year financial outlook following the release of its robust second-quarter results, which exceeded analysts' expectations. This positive trajectory has been primarily driven by the soaring demand for its innovative diabetes medication, Mounjaro, alongside its promising weight-loss treatment, Zepbound.
The pharmaceutical giant now anticipates adjusted earnings for 2024 to fall between $16.10 and $16.60 per share, a substantial increase from prior guidance, which forecasted earnings in the range of $13.50 to $14 per share. This optimistic update marks a notable contrast to the consensus figure calculated by analysts on Capital IQ, which stands at a normalized EPS of $13.71.
In response to these favorable developments, Eli Lilly's stock experienced a robust uptick of approximately 13% during premarket trading. In terms of revenue, the company is projecting figures between $45.4 billion to $46.6 billion for the year, reflecting a revision from the previous forecast of $42.4 billion to $43.6 billion.
This significant upward shift can be attributed to the remarkable performance of Mounjaro and Zepbound, as well as the strength of its non-incretin pharmaceuticals. Analysts on The Street have set their expectations at $42.95 billion for revenue for the current fiscal year. For the quarter ending in June, Eli Lilly reported a staggering 86% surge in adjusted EPS, reaching $3.92 per share, which significantly outstripped analysts’ estimates of $2.76 per share.
The company’s revenue for the quarter also saw a considerable climb, resulting in a total of $11.3 billion, up from $8.31 billion in the same quarter the previous year—again surpassing the analysts' expectations of $9.97 billion. Chief Executive David Ricks commented on the results, stating, "Mounjaro, Zepbound, and Verzenio led our strong financial performance in the second quarter as we advanced our manufacturing expansion agenda.
It is equally exciting to see the growth around the world of our medicines for cancer, neurological disorders, and autoimmune diseases." Verzenio, which is utilized in the treatment of breast cancer, has also contributed positively to the company’s financial results. In terms of geographical sales, the US market witnessed a significant boom, with sales soaring by 42% to reach $7.84 billion, driven by increases of 27% in volume and 15% in prices.
Moreover, sales from non-US markets also saw an impressive rise of 25%, totaling $3.47 billion, although partially impacted by a 3% foreign-exchange headwind. Mounjaro's sales experienced a remarkable leap, climbing to $3.09 billion from $979.7 million in the same quarter last year, propelled largely by heightened demand in the US.
Zepbound, which made its US debut in November, generated $1.24 billion in revenue during the second quarter. In contrast, Verzenio recorded a 44% increase in sales, while its competitor Trulicity saw a downturn, declining by 31%. Eli Lilly's gross margin showed marked improvement, increasing by 2.5 percentage points to 80.8%.
This enhancement was primarily driven by a favorable product mix coupled with rising prices. It is also noteworthy that the company’s marketing, selling, and administrative expenses rose by 10% year-over-year, totaling $2.12 billion. Overall, Eli Lilly’s strong quarterly performance and revised earnings outlook highlight its robust position in the pharmaceutical industry, particularly driven by its innovative treatments that address critical health issues..