How significant was the third-quarter beat?

  • Regeneron’s third-quarter revenue was 5.116 billion dollars, up 36% year over year and 12% above market consensus. Diluted earnings per share under US generally accepted accounting principles were 18.45 dollars, up 35% year over year and 28% above consensus.
  • Profit grew faster than revenue: GAAP operating profit was 2.048 billion dollars, up 99% year over year. Global revenue from cancer drug Libtayo also rose 51% year over year to 550 million dollars.

What did Eylea HD’s growth change?

  • Eylea HD’s third-quarter US revenue was 699 million dollars, up 17% quarter over quarter and 6% above market consensus. Over the same period, US revenue for competing product Vabysmo rose 3% quarter over quarter. Bernstein believes Eylea HD’s additional dosing intervals and retinal vein occlusion indication may have driven demand.
  • However, US revenue for the standard formulation of Eylea fell 41% year over year, leaving US revenue for the overall Eylea product line down 1% year over year at 1.099 billion dollars. Sequentially, product-line revenue rose 9%.
  • Bernstein expects that, if approved, the Eylea HD prefilled syringe could provide a new driver of growth; its review milestone is in the fourth quarter of 2026.

How did Dupixent drive collaboration revenue?

  • Dupixent’s third-quarter global sales rose 35% year over year and 9% quarter over quarter, exceeding market consensus by 6%. US sales grew 45% year over year and were the main driver; international sales rose 19% year over year.
  • Bernstein attributed the growth to launch momentum in indications including chronic obstructive pulmonary disease, chronic spontaneous urticaria and bullous pemphigoid. Regeneron’s collaboration revenue with Sanofi was 2.724 billion dollars, up 68% year over year and 11% above consensus.
  • The balance of Sanofi’s development expenses was fully repaid in the second quarter of 2026, and Bernstein expects the collaboration’s profit margin to expand further.

Why did the rating remain unchanged despite higher earnings forecasts?

  • Taking into account third-quarter performance and the company’s updated expense guidance, Bernstein raised its revenue forecasts for 2026 and 2027 by 7% and 4%, respectively, and its GAAP operating profit forecasts by 24% and 13%, respectively.
  • The company raised the midpoint of its 2026 non-GAAP research and development expense guidance by 100 million dollars, while lowering the midpoint of its selling, general and administrative expense guidance by 100 million dollars. It raised its GAAP gross margin guidance for net product sales from 78%–79% to approximately 80%.
  • Bernstein raised its price target from 756 dollars to 812 dollars and maintained its Market Perform rating; the new target is approximately 12% below the 30 October 2026 closing price of 927.89 dollars. The firm’s model forecasts revenue growth slowing from 27% in 2026 to 2% in 2027, with non-GAAP diluted earnings per share of 64.33 dollars and 64.43 dollars, respectively.