Shares of Gilead Sciences (NASDAQ: GILD) are down 3.7% as of 3:30 p.m. ET Wednesday after the biopharmaceuticals giant announced mixed quarterly results relative to Wall Street's expectations.
Why Gilead's "strong" year wasn't enough
Gilead's fourth-quarter 2023 revenue declined 3.7% year over year to $7.115 billion, translating to non-GAAP (adjusted) net income of $1.72 per share (up from $1.67 per share in the same year-ago period). Analysts, on average, were expecting higher adjusted earnings of $1.76 per share on slightly lower revenue of $7.1 billion.
Gilead's revenue decline came as lower sales of COVID-19 treatment Veklury and HIV products were only partially offset by higher oncology segment sales. Still, excluding Veklury, total product sales would have been up 7% year over year.
Gilead chairman and CEO Daniel O'Day called it "another strong year of revenue growth for Gilead's base business, [providing] a solid foundation as we enter a new catalyst-rich phase for the company."
What's next for Gilead shareholders?
O'Day singled out expectations in 2024 for updates on long-acting HIV prevention and treatment, as well as advances in both the cell therapy segment and Gilead's bladder cancer drug, Trodelvy. Shares of Gilead plunged last month after a late-stage trial of Trodelvy failed to meet its primary endpoint.
For the full year 2024, Gilead issued guidance for total product sales between $27.1 billion and $27.5 billion and adjusted earnings per share of between $6.85 and $7.25. Here again, the midpoints of both ranges were well below consensus estimates for 2024 earnings of $7.24 per share on revenue closer to $27.7 billion.
In the end, this was an underwhelming quarterly update that left little reason for Gilead bulls to cheer. The stock is simply responding in kind.
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Steve Symington has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Gilead Sciences. The Motley Fool has a disclosure policy.
