Skip to content
AnalystLens

GILEAD SCIENCES, INC. 8-K Report, Financial Results (Feb 6, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed February 6, 2024
Period End
February 6, 2024
Security
GILD
In the record · 2016–202610-K1210-Q328-K117

GILD filed 12 annual reports (10-K), 32 quarterly reports (10-Q) and 117 current reports (8-K) between 2016 and 2026.

  1. Leadership change8-K · Dec ’18Dec ’18
  2. Deal closed8-K · Jan ’21Jan ’21
  3. Leadership change8-K · Jul ’22Jul ’22
  4. Material agreement8-K · May ’26May ’26

01—Abstract

Summary

Summary of the 8-K filed February 6, 2024. Cited figures are marked; the original filing is the authoritative source.

Gilead Sciences closed 2023 with total revenue of $27.1 billiona, down 1% year over year, as a $1.7 billion decline in Veklury (remdesivir) sales was largely offset by growth in HIV and Oncology.

Excluding Veklury, product sales rose 7% to $24.7 billionb. Biktarvy grew 14% to $11.8 billion, Trodelvy rose 56% to $1.1 billion, and Cell Therapy (Yescarta and Tecartus) grew 28% to $1.9 billion. The base business is clearly strengthening, while the headline top line is held back by the COVID-19 franchise's normalization.

Profitability was mixed. GAAP diluted EPS rose to $4.50c from $3.64, helped by lower IPR&D impairments and lower equity investment losses. Non-GAAP diluted EPS fell to $6.72 from $7.26, reflecting higher R&D and SG&A, including a $525 million HIV antitrust litigation settlement, and lower Veklury sales.

Fourth-quarter GAAP product gross margin fell sharply to 70.4% from 81.0%, driven by restructuring charges tied to a manufacturing strategy change. Cash generation remained solid, with full-year operating cash flow of $8.0 billiond and free cash flow of $7.4 billion, against $8.4 billion of cash and marketable securities. For 2024, management guided total product sales of $27.1 to $27.5 billion, non-GAAP diluted EPS of $6.85 to $7.25, and GAAP diluted EPS of $5.15 to $5.55.

Veklury is expected to contribute only about $1.3 billion. Management highlighted several 2024 catalysts, including long-acting HIV prevention and treatment updates, Cell Therapy milestones, and Trodelvy readouts.

Setbacks included the failed Phase 3 OAKTREE obeldesivir trial and the EVOKE-01 Trodelvy lung cancer trial. The quarterly dividend was set at $0.77 per share.

02—Key points

Key Highlights

  1. FY2023 total revenue fell 1% to $27.1B, but product sales excluding Veklury rose 7% to $24.7B, showing the core business is growing.
  2. Biktarvy sales rose 14% to $11.8B for the year, and HIV sales grew 6% to $18.2B, anchoring Gilead's franchise.
  3. Oncology sales grew 37% to $2.9B, led by Trodelvy (+56% to $1.1B) and Cell Therapy (+28% to $1.9B).
  4. Veklury sales fell 44% to $2.2B as COVID-19 hospitalizations declined, and 2024 guidance assumes only about $1.3B.
  5. FY2023 GAAP diluted EPS rose to $4.50 from $3.64, while non-GAAP diluted EPS fell to $6.72 from $7.26.
  6. Q4 GAAP product gross margin fell to 70.4% from 81.0%, driven by about $479M of restructuring tied to manufacturing changes.
  7. 2024 guidance calls for product sales of $27.1–27.5B and non-GAAP EPS of $6.85–7.25; the quarterly dividend is $0.77 per share.

03—Questions

Frequently Asked Questions

  1. Why did Gilead's GAAP EPS rise in 2023 while non-GAAP EPS fell?

    GAAP diluted EPS increased to $4.50 from $3.64 mainly because 2022 included a $2.7B IPR&D impairment and large unrealized losses on equity investments, which did not repeat at the same scale in 2023. Non-GAAP EPS excludes these items, and it fell to $6.72 from $7.26 because of higher R&D and SG&A spending, including a $525M litigation settlement, and lower Veklury revenue.

  2. How much does Veklury's decline affect Gilead's outlook?

    Veklury sales dropped 44% to $2.2B in 2023 and are guided to about $1.3B in 2024. Because Veklury is volatile and tied to COVID-19 hospitalization rates, its decline weighs on reported revenue. Management says product sales excluding Veklury are guided to $25.8–26.2B, which is a clearer view of the underlying business.

  3. What caused the sharp drop in Q4 product gross margin?

    GAAP product gross margin fell to 70.4% in Q4 2023 from 81.0% a year earlier. The main driver was about $479M of restructuring charges tied to changes in manufacturing strategy, along with higher intangible amortization from Trodelvy. Non-GAAP product gross margin was steadier at 86.1% versus 86.8%.

  4. What are the key risks and catalysts for investors in 2024?

    Catalysts include long-acting HIV prevention and treatment updates, Cell Therapy milestones, and Trodelvy data. Setbacks already occurred: the Phase 3 OAKTREE obeldesivir trial missed its primary endpoint, and the EVOKE-01 Trodelvy trial in lung cancer did not meet its overall survival endpoint. Gilead also faces pricing pressure in the U.S. HIV market, including unfavorable Descovy pricing, and the possibility of generic competition.

  5. Is Gilead's dividend and cash position well supported?

    Yes. Gilead generated $8.0B of operating cash flow and $7.4B of free cash flow in 2023, and it ended the year with $8.4B in cash and marketable securities. The company declared a $0.77 quarterly dividend for Q1 2024, although the filing notes that future dividends remain subject to board approval.

04—Continue

← View all 8-K filings