10-QPeriod: Q2 FY2021

JOHNSON & JOHNSON Quarterly Report for Q2 Ended Apr 4, 2021

Filed April 30, 2021For Securities:JNJ

Summary

Johnson & Johnson (JNJ) reported strong performance for the first quarter of 2021, with total sales reaching $22.3 billion, a 7.9% increase year-over-year. This growth was driven by a 5.5% operational increase and a favorable currency impact of 2.4%. The Pharmaceutical segment was a key driver, showing a 9.6% increase in sales to $12.2 billion, fueled by strong performance in Oncology, Immunology, and Pulmonary Hypertension therapeutic areas. The Medical Devices segment also demonstrated robust growth, with sales up 10.9% to $6.6 billion, largely due to recovery in surgical procedures and strong performance in Interventional Solutions. While the Consumer Health segment experienced a slight decline of 2.3% in sales to $3.5 billion, this was attributed to comparisons with prior year COVID-19 related pantry loading and a weaker cough, cold, and flu season. Net earnings for the quarter were $6.2 billion, or $2.32 per diluted share, up from $5.8 billion, or $2.17 per diluted share, in the prior year. The company maintained a healthy cash flow from operations of $4.1 billion, supporting dividend payments and share repurchases, while also managing significant legal and restructuring reserves.

Financial Highlights

53 data points
Beta

Revenue

$22.32B

68.4% Gross Margin

Net Income

$6.20B

27.8% Net Margin

EPS (Diluted)

$2.32

Total Assets

$172.56B

Cash & Equivalents

$12.67B

Free Cash Flow

$3.40B

Financial Statements
Beta
Revenue$22.32B
Cost of Revenue$7.06B
Gross Profit$15.26B
SG&A Expenses$5.43B
Interest Expense$63.00M
Net Income$6.20B
EPS (Basic)$2.35
EPS (Diluted)$2.32
Shares Outstanding (Basic)2.63B
Shares Outstanding (Diluted)2.67B

Key Highlights

  • 1Total sales increased by 7.9% to $22.3 billion, driven by operational growth of 5.5% and a positive currency impact of 2.4%.
  • 2Pharmaceutical segment sales grew 9.6% to $12.2 billion, with key drivers including strong performance in Oncology (DARZALEX®, ERLEADA®, IMBRUVICA®) and Immunology (STELARA®, TREMFYA®).
  • 3Medical Devices segment sales surged by 10.9% to $6.6 billion, reflecting market recovery and growth in Surgery and Interventional Solutions.
  • 4Consumer Health segment sales saw a slight decrease of 2.3% to $3.5 billion, primarily due to challenging year-over-year comparisons and a less severe flu season.
  • 5Net earnings increased to $6.2 billion ($2.32 per diluted share) from $5.8 billion ($2.17 per diluted share) in the prior year's quarter.
  • 6Operating cash flow remained strong at $4.1 billion, providing ample liquidity for operations, dividends, and share repurchases.
  • 7The company continues to manage significant litigation reserves, particularly related to talc and opioid claims, which remain a key area of focus.

Frequently Asked Questions

Johnson & Johnson reported a total sales increase of 7.9% to $22.3 billion in the first quarter of 2021, compared to $20.7 billion in the same period of 2020. This growth was driven by a 5.5% operational increase and a positive currency impact of 2.4%.

The Pharmaceutical segment was the strongest contributor, with sales growing by 9.6% to $12.2 billion, driven by key products in Oncology and Immunology. The Medical Devices segment also showed robust growth, increasing sales by 10.9% to $6.6 billion, benefiting from market recovery in surgical procedures.

The Consumer Health segment experienced a slight decrease in sales by 2.3% to $3.5 billion. This was primarily due to challenging year-over-year comparisons from COVID-19 related 'pantry loading' in the prior year and a milder cough, cold, and flu season. However, categories like Baby Care and Skin Health/Beauty showed operational growth.

Johnson & Johnson generated strong operating cash flow of $4.1 billion in the first quarter of 2021. The company ended the quarter with $12.7 billion in cash and cash equivalents and $11.9 billion in marketable securities, indicating a solid liquidity position to fund operations, dividends, and share repurchases.

The filing extensively details ongoing litigation and legal proceedings, particularly concerning talc-based powders and opioid-related claims, for which the company holds significant accruals. While the company believes it has defenses, the ultimate outcome could materially impact future results of operations and cash flows. Restructuring charges related to the global supply chain optimization were also noted.