01—Abstract
Summary
Summary of the 10-Q filed April 28, 2026. Cited figures are marked; the original filing is the authoritative source.
Incyte Corporation's first-quarter 2026 Form 10-Q reports total revenues of $1,272.7 milliona for the three months ended March 31, 2026, up from $1,052.9 million a year earlier.
Net sales were $1,104.5 millionb, led by JAKAFI at $757.8 million, and product royalty revenues were $151.2 million. Net income was $303.3 million, or $1.47 per diluted share, compared with $158.2 million, or $0.80 per diluted share, in the prior-year quarter. The effective tax rate fell to 11.7% from 32.4%, reflecting recognition of previously unrecognized tax benefits, valuation allowance reversals and favorable effects of the One Big Beautiful Bill Act.
The balance sheet strengthened, with cash and cash equivalents of $3.46 billionc and marketable securities of $554.7 million at March 31, 2026, and no outstanding borrowings under the $500.0 million revolving credit facility. Net cash provided by operating activities was $369.4 million. Research and development expense rose to $515.9 million and selling, general and administrative expense to $328.1 million.
A $23.2 milliond asset impairment and disposal charge related to the sale of downtown Wilmington, Delaware properties was also recorded. The filing highlights ongoing legal and commercial risks. The company has accrued approximately $245.9 million related to a dispute with CMS over whether OPZELURA should be treated as a line extension of JAKAFI for Medicaid rebate purposes.
Generic challenges to JAKAFI and OPZELURA patents remain pending, and the filing states that JAKAFI product sales are expected to decline after patent exclusivity expires in 2028. The filing also discloses the appointment of Suketu Upadhyay as Executive Vice President and Chief Financial Officer, effective May 4, 2026.
02—Key points
Key Highlights
- Total revenues were $1,272.7 million, up from $1,052.9 million in the first quarter of 2025, with net sales of $1,104.5 million and product royalty revenues of $151.2 million.
- JAKAFI net sales were $757.8 million versus $709.4 million a year earlier, driven primarily by a 6% increase in paid demand according to the filing.
- Net income rose to $303.3 million ($1.47 diluted EPS) from $158.2 million ($0.80 diluted EPS), with the effective tax rate at 11.7% versus 32.4%.
- NIKTIMVO net sales reached $55.1 million (from $13.6 million) and ZYNYZ net sales reached $41.4 million (from $3.0 million).
- Cash, cash equivalents and marketable securities totaled $4.0 billion at March 31, 2026, and the $500.0 million revolving credit facility had no outstanding borrowings.
- Approximately $245.9 million is accrued in connection with the CMS line-extension dispute over OPZELURA, which the filing says would reduce OPZELURA gross-to-net deductions if resolved in the company's favor.
- The company appointed Suketu Upadhyay as Executive Vice President and Chief Financial Officer, effective May 4, 2026.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2026, Incyte kept $0.24.
- Revenue$1.27B100.0%
- Cost of revenue−$104.5M8.2%
- Gross profit$1.17B91.8%
- Operating costs−$867.0M68.1%
- Operating income$301.1M23.7%
- Interest, other & tax$2.2M0.2%
- Net income$303.3M23.8%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed April 28, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $1.27B$1.05B | +20.9% |
| Cost of Revenue | $104.52M$73.19M | +42.8% |
| Gross Profit | $1.17B$979.71M | +19.2% |
| R&D Expenses | $515.90M$437.28M | +18.0% |
| SG&A Expenses | $328.09M$325.69M | +0.7% |
| Operating Expenses | $971.56M$847.73M | +14.6% |
| Operating Income | $301.12M$205.17M | +46.8% |
| Net Income | $303.33M$158.20M | +91.7% |
| EPS (Basic) | $1.52$0.82 | +85.4% |
| EPS (Diluted) | $1.47$0.80 | +83.7% |
| Shares Outstanding (Basic) | 199.34M193.71M | +2.9% |
| Shares Outstanding (Diluted) | 206.83M198.20M | +4.4% |
05—Questions
Frequently Asked Questions
What drove the increase in revenue this quarter?
Total revenues rose to $1,272.7 million from $1,052.9 million. The filing attributes the increase in net sales primarily to JAKAFI demand growth, higher OPZELURA sales from U.S. patient demand and ex-U.S. uptake, and increased demand for NIKTIMVO, MONJUVI/MINJUVI and ZYNYZ. Royalty growth was primarily driven by JAKAVI, and milestone and contract revenues of $17.0 million were recorded this quarter.
Why did the effective tax rate decline so sharply?
The effective tax rate was 11.7% for the first quarter of 2026 compared with 32.4% a year earlier. The filing attributes the decline to the recognition of previously unrecognized tax benefits, reversals of certain U.S. and foreign valuation allowances, and favorable effects of the One Big Beautiful Bill Act, partly offset by a net increase in valuation allowances on certain U.S. federal and state deferred tax assets.
What is the main long-term risk to JAKAFI revenue?
The filing states that JAKAFI product sales are expected to begin declining upon expiration of patent exclusivity in 2028. Generic manufacturers have filed ANDAs and a 505(b)(2) NDA with paragraph IV certifications challenging the relevant patents, and litigation against several of them remains pending while settlements have been reached with Hikma and Granules.
What is the status of the CMS dispute over OPZELURA?
The company has sued CMS over its definition of a line extension for the Medicaid rebate program, arguing OPZELURA should not be treated as a line extension of JAKAFI. As of March 31, 2026, approximately $245.9 million was accrued for the incremental rebates that would be owed if OPZELURA were so treated, and the impact on OPZELURA gross-to-net deductions for the quarter was approximately 8.4%.
What changes in the leadership and capital position are disclosed?
Suketu Upadhyay was appointed Executive Vice President and Chief Financial Officer effective May 4, 2026, with a base salary of $850,000 and a target bonus of 60% of base salary. At March 31, 2026, shares outstanding were 199,948,401 and stockholders' equity was $5.62 billion, with the company stating it had no borrowings under its revolving credit facility.
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