Bernstein: Bristol-Myers Squibb beats third-quarter revenue and earnings expectations as growth brands diverge

Where did the third-quarter beat come from?

The company reported third-quarter revenue of 13.069 billion dollars, up 7% year over year and 2.7% above market consensus. Non-GAAP earnings per share were 1.35 dollars, 18.8% above consensus but down 17% year over year.
The beat extended across new and established products: sales in the growth portfolio rose 12% year over year and were 2.0% above consensus; the mature portfolio was 3.1% above consensus, including Eliquis sales of 4.69 billion dollars, up 25% year over year.
The total revenue beat did not come entirely from product sales: net product sales were only 0.1% above consensus, while alliance and other revenue was 463 million dollars, 40.6% above consensus.

The growth portfolio performed well overall, but individual products differed. Opdivo Qvantig sales were 334 million dollars, 5.6% above consensus; Breyanzi sales were 526 million dollars, 6.6% above consensus.
Cobenfy sales were 57 million dollars, 14.3% below consensus and down 10% quarter over quarter; Camzyos sales were 420 million dollars, 2.3% below consensus. Bernstein said the growth portfolio improved the quality of the earnings beat, but Cobenfy remained weak.
Mature products did not all grow either: Revlimid sales were 303 million dollars, 29.7% above consensus but still down 47% year over year; Pomalyst/Imnovid sales fell 81% year over year.

Third-quarter gross margin was 68.4%, down 453 basis points year over year and below market consensus of 69.0%; cost of products sold rose 25% year over year, faster than revenue.
Operating margin was 25.4%, 99 basis points above consensus but down 782 basis points year over year. Bernstein said lower-than-expected research and development and selling, general and administrative expenses were the main reason operating margin beat expectations; the company’s full-year operating expense guidance remained unchanged.

The company raised its 2026 revenue guidance from 49 billion–50 billion dollars to 49.75 billion–50.25 billion dollars; the low end of the new range is slightly below market consensus of approximately 49.9 billion dollars. Full-year non-GAAP earnings-per-share guidance is 6.35–6.55 dollars, including the impact of 0.60 dollars per share in acquired in-process research and development charges. Bernstein said the guidance improvement came mainly from lower net other income and expenses.
The company maintained its outlook for Eliquis full-year revenue growth of 20%–25% and narrowed its expected full-year decline for the mature portfolio from 4%–6% to 3%–5%. Bernstein is watching the long-term decline trajectory of Eliquis and other mature products, as well as Cobenfy’s sales progress following launch.
For new drugs, results from the LIBREXIA-STROKE trial of milvexian are expected in 2026, and LIBREXIA-AF results are expected in the first quarter of 2027; results from the ADEPT-1, -2 and -4 trials of Cobenfy for Alzheimer’s disease-related psychosis are expected in 2027. Bernstein views these studies as key events with highly uncertain outcomes.
Bernstein rates the company Market Perform with a price target of 61 dollars. Its valuation discussion notes that a concentrated wave of patent expirations weighs on growth, while faster-than-expected declines in mature product sales are a downside risk.