Bernstein: Amgen’s third-quarter results beat expectations, but growth quality and expense timing differ

How much of the third-quarter beat came from sustainable growth?

Amgen reported third-quarter 2026 revenue of 10.365 billion dollars, up 8.5% year over year and 3.4% above market consensus; non-GAAP earnings per share were 6.45 dollars, 12.1% above consensus. Strong sales and lower-than-expected selling, general and administrative expenses helped offset higher-than-expected research and development spending.
Sales of the company’s six strategic growth driver products rose 27% year over year and accounted for more than seventy percent of product sales, continuing to offset sales erosion from Prolia and XGEVA. Uplizna sales were 451 million dollars, up 191% year over year; Repatha sales were 1.085 billion dollars, up 37% year over year. They exceeded consensus by 22% and 5%, respectively.
But the beat did not come entirely from demand: the older drug Enbrel accounted for 113 million dollars of the 311 million-dollar product sales beat, with sales supported by favorable sales deductions and higher inventory; its net selling price fell 14% and volume also declined during the period. Bernstein believes this performance will be difficult to repeat.
Amid biosimilar competition, Prolia and XGEVA sales fell 45% and 47% year over year, respectively, both below consensus; TEPEZZA sales also fell 6% year over year, 11% below consensus.

Third-quarter Imdelltra sales were 406 million dollars, up 128% year over year and 27% above consensus; however, U.S. sales were flat quarter over quarter, and the entire beat came from launches in new markets outside the United States.
A longer-term opportunity lies in first-line maintenance treatment: median overall survival in the relevant study was 21.1 months, versus 12.7 months in the control group. Bernstein believes earlier use could increase the number of eligible patients and extend treatment duration, and expects the impact of expansion to emerge from late 2027 into 2028.
Reduced administration monitoring requirements may also help broaden use in U.S. community care settings: monitoring for the first two administrations of the approved second-line treatment has been reduced from 22–24 hours to 6–8 hours. The 1–2-hour monitoring used in the first-line study still awaits a future label change.

The company raised its 2026 revenue guidance from 38.2 billion–39.4 billion dollars to 38.9 billion–39.7 billion dollars, and its non-GAAP earnings-per-share guidance from 22.30–23.50 dollars to 22.90–23.70 dollars. Bernstein accordingly raised its full-year revenue forecast by 1.03 billion dollars to 39.58 billion dollars and its earnings-per-share forecast from 22.66 dollars to 23.31 dollars.
The third-quarter non-GAAP operating margin was 47.3%, 239 basis points above consensus, but the company maintained its full-year guidance of 45%–46%. Management expects expenses to increase significantly quarter over quarter in the fourth quarter: product mix and profit sharing will raise cost of sales, while commercial investment and the fading benefit of third-quarter expense timing will raise selling, general and administrative expenses.
For 2027, management expects the operating margin to be no lower than the 2026 guidance range despite continued pipeline investment; this is a margin reference provided before formal 2027 guidance is issued.

Bernstein raised its price target from 345 dollars to 400 dollars and maintained its market-perform rating. The firm increased the price-to-earnings multiple used in its valuation from 14.8 times to 17 times, citing factors including a sector valuation re-rating and improved execution on growth products and margins; the price target is below the 3 November closing price of 461.26 dollars.
The proposed differentiation for the weight-loss drug MariTide is administration four or six times a year once patients enter maintenance treatment, but no pivotal trial has yet tested this extended interval. Management provided no new tolerability evidence; Bernstein is focused on tolerability and discontinuation risks in the phase-three trial and the data readout in the first quarter of 2027.
A study of Dazodalibep for systemic manifestations of Sjögren’s syndrome has progressed, but another study addressing symptoms in a different patient population remains a separate hurdle and is expected to be completed in the fourth quarter of 2026. Bernstein also lists tax litigation as a downside risk.