10-QPeriod: Q1 FY2024

GILEAD SCIENCES, INC. Quarterly Report for Q1 Ended Mar 31, 2024

Filed May 8, 2024For Securities:GILD

Summary

Gilead Sciences, Inc. reported a net loss of $4.17 billion for the first quarter of 2024, a significant decrease from a net income of $1.01 billion in the prior year period. This loss was largely attributed to a substantial acquired in-process research and development (IPR&D) charge of $3.9 billion related to the acquisition of CymaBay Therapeutics and a $2.4 billion impairment charge for certain IPR&D assets connected to Trodelvy. Despite the net loss, total revenues saw a 5% increase year-over-year, reaching $6.69 billion. This growth was driven by strong performance in HIV and Oncology segments, with notable increases in Biktarvy and Trodelvy sales. However, Veklury sales experienced a decline, reflecting decreased COVID-19 related hospitalizations. Financial activities during the quarter included significant investments in acquisitions, notably the CymaBay purchase, and ongoing share repurchases and dividend payments, contributing to a decrease in cash and cash equivalents.

Financial Highlights

56 data points
Beta

Revenue

$6.69B

76.8% Gross Margin

Net Income

-$4.17B

-62.4% Net Margin

EPS (Diluted)

$-3.34

Total Assets

$56.29B

Cash & Equivalents

$4.72B

Free Cash Flow

$2.11B

Financial Statements
Beta
Revenue$6.69B
Cost of Revenue$1.55B
Gross Profit$5.13B
SG&A Expenses$1.38B
Operating Expenses$11.01B
Operating Income-$4.32B
Interest Expense$254.00M
Net Income-$4.17B
EPS (Basic)$-3.34
EPS (Diluted)$-3.34
Shares Outstanding (Basic)1.25B
Shares Outstanding (Diluted)1.25B

Key Highlights

  • 1Total revenues increased by 5% to $6.69 billion for Q1 2024, driven by growth in HIV and Oncology product sales.
  • 2Reported a net loss of $4.17 billion for Q1 2024, compared to a net income of $1.01 billion in Q1 2023, primarily due to significant IPR&D charges and impairments.
  • 3Acquisition of CymaBay Therapeutics for $3.9 billion (net cash) was completed in March 2024, adding seladelpar to the pipeline.
  • 4A $2.4 billion impairment charge was recognized for IPR&D assets related to Trodelvy for metastatic NSCLC, following a Phase 3 study that did not meet its primary endpoint.
  • 5HIV product sales grew 4% to $4.34 billion, led by strong demand for Biktarvy.
  • 6Trodelvy sales increased by 39% to $309 million, reflecting higher demand.
  • 7Net cash provided by operating activities was $2.22 billion, while net cash used in investing activities was $2.21 billion, largely due to the CymaBay acquisition.

Frequently Asked Questions

The net loss of $4.17 billion was primarily driven by a $3.9 billion acquired in-process research and development (IPR&D) charge related to the acquisition of CymaBay Therapeutics and a $2.4 billion impairment charge for certain IPR&D assets associated with Trodelvy. These are non-cash charges related to strategic investments and asset revaluations.

Total revenues increased by 5% to $6.69 billion. The HIV segment grew 4% to $4.34 billion, largely due to Biktarvy. Oncology product sales increased significantly, with Trodelvy up 39% to $309 million and Cell Therapy up 7% to $480 million. Liver Disease product sales also rose 9% to $737 million. Veklury (COVID-19 treatment) sales decreased by 3% to $555 million.

The primary investing activity was the completion of the acquisition of CymaBay Therapeutics for $3.9 billion (net cash). The company also made investments in equity securities and capital expenditures, while proceeds were generated from the sale and maturity of marketable debt securities, which were used to help fund the CymaBay acquisition.

Gilead maintained a strong operating cash flow of $2.22 billion. As of March 31, 2024, cash and cash equivalents were $4.72 billion. The company continued to return capital to shareholders through $990 million in dividend payments and $400 million in stock repurchases during the quarter. A $1.75 billion senior unsecured note was repaid in April 2024.