Goldman Sachs: BeOne’s third-quarter profit growth outpaces revenue growth; full-year guidance raised again

Where did third-quarter revenue growth come from?

In the third quarter of 2026, BeOne’s product sales were $1.86 billion, up 33% year over year and above Goldman Sachs’ previous estimate of $1.74 billion. The main driver was global Brukinsa sales of $1.39 billion, up 34% year over year and above the firm’s estimate of $1.31 billion.
Brukinsa’s U.S. sales exceeded $1 billion for the first time in a single quarter, up 36% year over year; sales in Europe were $218 million, up 33% year over year. Goldman Sachs said this reflected the product’s continued share gains in key markets.
Sales of another product, Tevimbra, were $243 million, up 28% year over year. Of that amount, sales in China were $200 million, while overseas sales were $40 million, up 33% quarter over quarter.

Third-quarter gross margin was 88.3%, above 85.9% in the same period a year earlier, but slightly below Goldman Sachs’ estimate of 88.6%. A higher sales mix for Brukinsa and improved production efficiency lifted gross margin, while a $22 million non-cash impairment charge resulting from the discontinuation of POBEVCY offset part of the improvement.
Selling, general and administrative expenses increased 12% year over year to $593 million, while R&D expenses rose 26% to $661 million; both grew more slowly than product revenue. As a result, operating profit under U.S. GAAP increased 157% year over year to $419 million, also above Goldman Sachs’ estimate of $251 million.
The company raised its 2026 revenue guidance from $6.6 billion–$6.8 billion to $6.9 billion–$7 billion, and its operating profit guidance from $1 billion–$1.1 billion to $1.2 billion–$1.3 billion. Gross margin guidance remained near 90%, while operating expense guidance was narrowed to $4.9 billion–$5 billion.

Goldman Sachs is positive on the expansion of the hematologic oncology pipeline, including BEQALZI and the investigational drug tacabrutideg. The latter met the primary endpoint of objective response rate in its pivotal phase two trial in relapsed or refractory chronic lymphocytic leukemia, which could support the company in seeking marketing approval around mid-2027; a phase three combination study with BEQALZI is planned to start in the first half of 2027.
In solid tumors, BGB-B2033 is scheduled to start a phase three trial in second-line and later-line liver cancer in the fourth quarter of 2026, and a first-line phase three trial in the first half of 2027. Goldman Sachs believes progress in key trials can help reduce pipeline uncertainty and broaden medium-term growth sources beyond the core BTK products.
Pipeline expansion also requires investment: Goldman Sachs expects commercialization of recently launched products and multiple global phase three trials in solid tumors to drive operating expenses higher.

Goldman Sachs raised its EPS forecasts for 2026 and 2027 from $7.85 and $10.58 to $10.92 and $11.50, respectively, while lowering its forecast for 2028 from $11.59 to $8.35. Factors behind the changes included third-quarter results, recent gross margin and expense estimates, and higher R&D expenses resulting from the expansion of pivotal trials.
The firm added a CDK4 inhibitor and a GPC3/4-1BB program to its valuation, maintained Buy ratings on the U.S.-listed shares and A-shares, and raised its 12-month target prices from $441.30 and RMB 381.06 to $500.84 and RMB 421.45, respectively.