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BRISTOL MYERS SQUIBB CO 8-K Report, Financial Results (Oct 31, 2024)

Reports
Earnings & Results·Regulation FD·Exhibits & Filings
Filing Date
Filed October 31, 2024
Period End
October 31, 2024
Securities
BMYCELG-RIBMYMP
In the record · 2016–202610-K1110-Q328-K169

BMY filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 169 current reports (8-K) between 2016 and 2026.

  1. Deal closed8-K · Nov ’19Nov ’19
  2. Leadership change8-K · Aug ’21Aug ’21
  3. Leadership change8-K · Oct ’23Oct ’23

01—Abstract

Summary

Summary of the 8-K filed October 31, 2024. Cited figures are marked; the original filing is the authoritative source.

Bristol Myers Squibb reported third quarter 2024 results on October 31, 2024, with total revenues of $11.9 billiona, up 8% reported and 10% excluding foreign exchange.

The Growth Portfolio was the main driver, with revenues of $5.8 billionb, up 18% reported and 20% ex-FX, led by Reblozyl, Breyanzi, Camzyos, and Opdualag. The Legacy Portfolio grew 1% to $6.1 billion, supported by Eliquis (up 11%), which offset steep erosion in Sprycel (down 44%) following U.S. generic entry. The most notable regulatory event was the U.S. FDA approval of Cobenfy (xanomeline and trospium chloride) for schizophrenia on September 26, 2024, which management describes as the first new pharmacological mechanism for the condition in decades.

Management expects the majority of patient access by the second half of 2025. Profitability was mixed. GAAP EPS fell 35% to $0.60c from $0.93, and non-GAAP EPS fell 10% to $1.80 from $2.00.

Both figures include a net $(0.09) per share charge from acquired IPRD and licensing income. GAAP gross margin declined to 75.1% from 77.1%, and the GAAP effective tax rate rose to 27.5% from 9.5%. Interest expense rose to $505 milliond from $280 million, reflecting higher debt after recent acquisitions.

Net debt stood at $41.3 billion at September 30, 2024, versus $27.1 billion at year-end 2023. Management reported that total debt was reduced by about $2.7 billion in the quarter and by about $5.9 billion over Q2 and Q3, and it targets roughly $10 billion of debt paydown by the end of 1H 2026. Full-year 2024 guidance was raised.

Reported revenue growth is now expected at about 5% (about 6% ex-FX), and non-GAAP EPS guidance was raised to $0.75 to $0.95 from $0.60 to $0.90. Investors should note that the CheckMate-8HW trial met its primary endpoint, while CheckMate-901 missed its overall survival endpoint in urothelial carcinoma. The company also flagged increased Q4 operating expense investment and expected pressure on Abraxane U.S. sales from generic entrants.

02—Key points

Key Highlights

  1. Q3 2024 total revenues of $11.9 billion rose 8% (10% ex-FX), with the Growth Portfolio up 18% (20% ex-FX) to $5.8 billion.
  2. Cobenfy received FDA approval on September 26, 2024 for schizophrenia, the first new pharmacological approach in decades, with launch now underway.
  3. GAAP EPS fell 35% to $0.60 and non-GAAP EPS fell 10% to $1.80, both including a $(0.09) per share net impact from acquired IPRD charges and licensing income.
  4. FY2024 guidance raised: revenue growth to about 5% reported (6% ex-FX) and non-GAAP EPS to $0.75 to $0.95 from $0.60 to $0.90.
  5. Net debt rose to $41.3 billion from $27.1 billion at year-end 2023, with interest expense up to $505 million from $280 million year over year; management reports about $5.9 billion of debt reduction across Q2 and Q3.
  6. Sprycel revenues fell 44% due to U.S. generic entry (September 1, 2024), and Legacy Portfolio growth was held to 1% by Eliquis growth of 11%.
  7. CheckMate-8HW met its PFS primary endpoint in MSI-H/dMMR colorectal cancer, while CheckMate-901 missed its overall survival primary endpoint in urothelial carcinoma.

03—Questions

Frequently Asked Questions

  1. What drove the revenue growth in the third quarter of 2024?

    Total revenues rose 8% to $11.9 billion (10% ex-FX). The Growth Portfolio, up 18% to $5.8 billion, was led by Reblozyl (up 80%), Breyanzi (up 143%), Camzyos (up 129%), and Opdualag (up 40%). Eliquis, up 11% to $3.0 billion, also contributed, partly offset by Sprycel's 44% decline.

  2. Why did GAAP EPS decline so sharply compared with the prior year?

    GAAP EPS fell to $0.60 from $0.93. Drivers included a GAAP gross margin decline to 75.1% from 77.1% due to product mix, a GAAP effective tax rate increase to 27.5% from 9.5%, higher interest expense, and higher acquired IPRD charges ($262 million versus $80 million). Non-GAAP EPS declined less, to $1.80 from $2.00.

  3. How did management change its 2024 financial outlook?

    Management raised 2024 guidance: total revenues are now expected to grow about 5% reported (about 6% ex-FX), up from the upper end of a low-single-digit range. Non-GAAP diluted EPS is now expected at $0.75 to $0.95, up from $0.60 to $0.90. Gross margin is now expected at about 74.5% to 75%, and the non-GAAP tax rate at about 60%. Guidance excludes future acquisitions, divestitures, and future acquired IPRD charges.

  4. What are the key risks for investors from the balance sheet and pipeline?

    Net debt increased to $41.3 billion from $27.1 billion at year-end 2023, and interest expense rose substantially. Management plans to pay down about $10 billion of debt by the end of 1H 2026. On the pipeline side, the CheckMate-901 trial missed its overall survival endpoint in urothelial carcinoma, while Cobenfy's expansion depends on future Phase 3 readouts expected in 2025 and 2026. Continued Sprycel and Abraxane generic erosion is also a headwind.

04—Continue

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