Summary
Amgen Inc. reported total revenues of $6.71 billion for the third quarter of 2021, a 4% increase compared to the same period in the prior year. This growth was driven by a 19% increase in Rest of World (ROW) product sales and a 21% increase in other revenues, largely attributed to sales of COVID-19 antibody material. However, net income decreased by 7% year-over-year to $1.88 billion, and diluted earnings per share (EPS) declined by 3% to $3.31. The nine-month period ending September 30, 2021, showed a 2% increase in total revenues to $19.13 billion, but a significant 29% drop in net income to $3.99 billion and a 27% decrease in diluted EPS to $6.93. This decline in profitability was significantly impacted by higher operating expenses, including $1.5 billion in acquired in-process research and development related to the Five Prime acquisition and a $400 million upfront payment for a licensing agreement with Kyowa Kirin. The company also faces ongoing significant legal challenges related to U.S. tax matters, with a potential tax liability of approximately $3.6 billion, plus interest, which could materially impact future financial statements. Amgen continues to return capital to shareholders through dividends and stock repurchases, with approximately $2.9 billion remaining under its stock repurchase program as of September 30, 2021. Subsequent to the quarter, the company announced an additional $4.5 billion authorization for repurchases. The company also completed the acquisition of Teneobio, Inc. for an upfront payment of $900 million, plus potential future milestone payments, to expand its pipeline in antibody therapeutics.
Financial Highlights
54 data points| Revenue | $6.71B |
| Cost of Revenue | $1.61B |
| Gross Profit | $5.10B |
| SG&A Expenses | $1.30B |
| Operating Expenses | $4.33B |
| Operating Income | $2.38B |
| Interest Expense | $296.00M |
| Net Income | $1.88B |
| EPS (Basic) | $3.32 |
| EPS (Diluted) | $3.31 |
| Shares Outstanding (Basic) | 567.00M |
| Shares Outstanding (Diluted) | 570.00M |
Key Highlights
- 1Total revenues for Q3 2021 increased 4% to $6.71 billion, while nine-month revenues grew 2% to $19.13 billion, driven by ROW product sales and other revenues (including COVID-19 antibody material).
- 2Net income for Q3 2021 decreased 7% to $1.88 billion and for the nine-month period declined 29% to $3.99 billion, significantly impacted by higher operating expenses.
- 3Operating expenses increased 9% in Q3 and 18% year-to-date, primarily due to acquired in-process R&D from the Five Prime acquisition ($1.5 billion) and an upfront payment for the Kyowa Kirin licensing agreement ($400 million).
- 4Diluted EPS for Q3 2021 decreased 3% to $3.31, and for the nine-month period, it fell 27% to $6.93.
- 5Amgen completed the acquisition of Five Prime Therapeutics for $1.6 billion in April 2021, recognizing $1.5 billion in acquired in-process R&D.
- 6The company continues to return capital to shareholders, with $2.9 billion authorized for stock repurchases remaining as of September 30, 2021, and an additional $4.5 billion authorized in October 2021.
- 7Amgen faces significant U.S. tax litigation concerning profit allocation between the U.S. and Puerto Rico, with potential additional federal tax liabilities of approximately $3.6 billion, plus interest.