Why did GAAP EPS rise so much while non-GAAP EPS grew only modestly?

GAAP EPS benefited from a 6.5-point improvement in GAAP operating margin, mainly from lower amortization of acquisition-related intangibles (acquisition-related cost of sales fell from $1.46B to $0.94B). Non-GAAP results exclude those amortization charges, and they also exclude equity investment losses. Non-GAAP EPS growth of 4% was held back by higher R&D (up 10%, driven by MariTide Phase 3 spending), higher profit share and manufacturing costs, and a higher non-GAAP tax rate of 15.6% versus 14.2%.

How much of the free cash flow increase is structural versus one-time?

Part of the improvement is one-time. Q2 2025 included the final repatriation tax payment, so the year-over-year comparison is inflated. Amgen attributes the rest to business performance, partly offset by working capital timing. Six-month FCF of $5.0B versus $2.9B in the prior year provides a fuller picture, but the same repatriation effect still distorts that comparison.

What is the main risk to the TAVNEOS franchise?

The FDA's Center for Drug Evaluation and Research has asked Amgen to voluntarily withdraw TAVNEOS from the U.S. market. Amgen requested a hearing on June 1, 2026, and submitted supporting materials on July 23, 2026, arguing for a favorable benefit-risk profile. TAVNEOS generated $150M in Q2 sales, up 36%, so a withdrawal would remove a meaningful but not large revenue stream. The outcome of the hearing is not yet known.

Is MariTide on track, and what does it mean for spending?

Amgen has several Phase 3 MariTide studies ongoing or enrolling, including MARITIME-1 and -2 for weight management, MARITIME-CV and -HF for cardiovascular and heart failure outcomes, and additional sleep apnea and switch studies. Three Phase 3 studies in type 2 diabetes will start in 2026. This pipeline is the main driver of R&D growth, so near-term operating expense growth is likely to persist even though the program is long-dated.

Why did legacy product sales fall, and will the decline continue?

Prolia and XGEVA sales fell 32% and 34% due to multiple denosumab biosimilar launches, which reduced both volume and net selling price. Enbrel's net selling price dropped 22% due to Medicare Part D price setting under the Inflation Reduction Act, effective January 1, 2026, and a higher 340B mix. Amgen says more biosimilars are expected, so further pressure on these franchises is likely, and the growth drivers must offset it.

AMGN 8-K: Earnings & Results

01—Abstract

Summary

Summary of the 8-K filed August 4, 2026. Cited figures are marked; the original filing is the authoritative source.

Amgen reported second-quarter 2026 results that beat on the top and bottom lines against the prior-year period.

Total revenues rose 10% to $10.1 billion^a, with product sales up 9% to $9.5 billion driven mainly by volume. GAAP diluted EPS more than doubled... rising 65% to $4.37, largely because of lower acquisition-related amortization and a much smaller prior-year equity investment loss. Non-GAAP diluted EPS grew 4% to $6.29, held back by higher R&D (up 10%, led by MariTide Phase 3 spending), higher cost of sales from profit share and manufacturing, and a higher tax rate.

Free cash flow was $3.5 billion^b versus $1.9 billion a year earlier, though the comparison is flattered by the final repatriation tax payment in Q2 2025. Growth is concentrated in newer products. Six key growth drivers rose 26% and represent nearly 70% of product sales, with strong gains from Repatha (+37%), EVENITY (+38%), TEZSPIRE (+42%), UPLIZNA (+90%), PAVBLU (+121%) and IMDELLTRA (+115%).

Legacy franchises are under pressure from biosimilar and IRA-related pricing erosion: Prolia fell 32%, XGEVA fell 34%, Otezla fell 21%, and Enbrel fell 4% with net selling price down 22%. The company also faces a regulatory overhang on TAVNEOS, where the FDA has requested voluntary withdrawal and Amgen has requested a hearing, and it paused enrollment in two subcutaneous blinatumomab studies after an FDA partial clinical hold. Guidance was not changed in the excerpt provided: full-year 2026 non-GAAP EPS is $22.30 to $23.50^c, GAAP EPS is $15.80 to $17.08, and total revenues are expected at $38.2 to $39.4 billion.

Balance sheet leverage increased, with debt rising to $57.3 billion^d from $54.6 billion at year-end 2025, and no share repurchases were made in the quarter. Investors will likely focus on the durability of the growth franchises, MariTide's Phase 3 progress, and the TAVNEOS regulatory outcome.

02—Key points

Key Highlights

Total revenues up 10% YoY to $10.1B; product sales up 9% to $9.5B, driven by volume growth
GAAP diluted EPS up 65% to $4.37 vs. $2.65; non-GAAP diluted EPS up 4% to $6.29 vs. $6.02
Six key growth drivers up 26% YoY, comprising nearly 70% of Q2 product sales (Repatha +37%, EVENITY +38%, TEZSPIRE +42%, UPLIZNA +90%, IMDELLTRA +115%, PAVBLU +121%)
Biosimilar and IRA pressure on legacy products: Prolia -32%, XGEVA -34%, Otezla -21%, Enbrel -4% with net selling price down 22%
Free cash flow of $3.5B vs. $1.9B in Q2 2025, flattered by the 2025 final repatriation tax payment; no share repurchases in the quarter
Regulatory risk: FDA requested voluntary withdrawal of TAVNEOS (Amgen requested a hearing); FDA partial clinical hold paused two subcutaneous blinatumomab studies
FY2026 guidance unchanged in the excerpt: non-GAAP EPS $22.30–$23.50, GAAP EPS $15.80–$17.08, revenues $38.2–$39.4B; total debt rose to $57.3B from $54.6B

03—Questions

Frequently Asked Questions

Why did GAAP EPS rise so much while non-GAAP EPS grew only modestly?
GAAP EPS benefited from a 6.5-point improvement in GAAP operating margin, mainly from lower amortization of acquisition-related intangibles (acquisition-related cost of sales fell from $1.46B to $0.94B). Non-GAAP results exclude those amortization charges, and they also exclude equity investment losses. Non-GAAP EPS growth of 4% was held back by higher R&D (up 10%, driven by MariTide Phase 3 spending), higher profit share and manufacturing costs, and a higher non-GAAP tax rate of 15.6% versus 14.2%.
How much of the free cash flow increase is structural versus one-time?
Part of the improvement is one-time. Q2 2025 included the final repatriation tax payment, so the year-over-year comparison is inflated. Amgen attributes the rest to business performance, partly offset by working capital timing. Six-month FCF of $5.0B versus $2.9B in the prior year provides a fuller picture, but the same repatriation effect still distorts that comparison.
What is the main risk to the TAVNEOS franchise?
The FDA's Center for Drug Evaluation and Research has asked Amgen to voluntarily withdraw TAVNEOS from the U.S. market. Amgen requested a hearing on June 1, 2026, and submitted supporting materials on July 23, 2026, arguing for a favorable benefit-risk profile. TAVNEOS generated $150M in Q2 sales, up 36%, so a withdrawal would remove a meaningful but not large revenue stream. The outcome of the hearing is not yet known.
Is MariTide on track, and what does it mean for spending?
Amgen has several Phase 3 MariTide studies ongoing or enrolling, including MARITIME-1 and -2 for weight management, MARITIME-CV and -HF for cardiovascular and heart failure outcomes, and additional sleep apnea and switch studies. Three Phase 3 studies in type 2 diabetes will start in 2026. This pipeline is the main driver of R&D growth, so near-term operating expense growth is likely to persist even though the program is long-dated.
Why did legacy product sales fall, and will the decline continue?
Prolia and XGEVA sales fell 32% and 34% due to multiple denosumab biosimilar launches, which reduced both volume and net selling price. Enbrel's net selling price dropped 22% due to Medicare Part D price setting under the Inflation Reduction Act, effective January 1, 2026, and a higher 340B mix. Amgen says more biosimilars are expected, so further pressure on these franchises is likely, and the growth drivers must offset it.

04—Continue

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