How much did third-quarter results exceed expectations?

  • BeOne’s revenue in 3Q26 was 1.89 billion US dollars, up 33.8% year over year, above Bloomberg’s and Visible Alpha’s expectations of 1.75 billion and 1.76 billion US dollars, respectively. Net profit attributable to shareholders was 385 million US dollars, up 208.2% year over year, also above the two firms’ respective forecasts of 237 million and 218 million US dollars.

Which product drove most of the growth, and how is the competitive landscape evolving?

  • Third-quarter sales of zanubrutinib were 1.391 billion US dollars, up 33.7% year over year and 11.5% quarter over quarter. Sales in the US, Europe and China were 1.005 billion, 218 million and 103 million US dollars, respectively, up 36%, 33% and 12% year over year. The US was the largest source of revenue among them.
  • Performance among competing drugs in the same quarter was mixed: ibrutinib sales were 760 million US dollars, down 23% year over year; acalabrutinib sales were 1.065 billion US dollars, up 16%; and sales of newcomer pirtobrutinib were 228 million US dollars, up 59%. Thus, zanubrutinib’s growth outpaced that of the first two drugs, while the new entrant also grew rapidly from a smaller sales base.

How fast does revenue need to grow in the fourth quarter after the full-year guidance increase?

  • Management raised FY26 revenue guidance from 6.6 billion–6.8 billion US dollars to 6.9 billion–7 billion US dollars. GAAP operating profit guidance increased from 1 billion–1.1 billion US dollars to 1.2 billion–1.3 billion US dollars, while non-GAAP operating profit guidance rose from 1.7 billion–1.8 billion US dollars to 1.9 billion–2 billion US dollars. The gross margin guidance remained unchanged at a level in the high eighties of percentage points.
  • According to Nomura’s estimates, the new revenue guidance implies revenue of 1.79 billion–1.89 billion US dollars in 4Q26, up 19.6%–26.3% year over year. Bloomberg’s forecast is 1.8 billion US dollars, within the company’s guidance range. Compared with the third quarter’s 33.8% year-over-year revenue growth, fourth-quarter growth is expected to slow but remain positive.

Nomura maintains Buy; what underpins its valuation?

  • Nomura maintained its Buy rating and target price of HK$288.70. The closing price on 4 November was HK$231.60. Its valuation uses a discounted cash flow model, assuming a weighted average cost of capital of 10.6% and a perpetual growth rate of 4.0%.
  • The report identifies slower sales growth as a downside risk. Based on Nomura’s forecast, BeOne’s current share price represents a price-to-earnings ratio of 49.8 times its FY26 earnings per share of 0.64 US dollars. The sustainability of growth is an important condition supporting this valuation.