10-QPeriod: Q3 FY2025

JOHNSON & JOHNSON Quarterly Report for Q3 Ended Sep 28, 2025

Filed October 22, 2025For Securities:JNJ

Summary

Johnson & Johnson (JNJ) reported robust financial results for the fiscal third quarter ending September 27, 2025. Sales increased by 6.8% year-over-year to $24.0 billion, driven by strong performance in both the Innovative Medicine and MedTech segments. Net earnings saw a significant jump to $5.2 billion, translating to diluted earnings per share of $2.12, compared to $2.7 billion and $1.11 in the prior year's third quarter. This performance reflects broad-based growth across key therapeutic areas and product lines, alongside effective cost management. The company demonstrated strong operational execution, with a positive impact from currency fluctuations and strategic acquisitions contributing to top-line growth. The balance sheet remains solid, with total assets growing to $192.8 billion. The company's strategic focus on innovation and portfolio management is evident in the performance of its Innovative Medicine segment, which saw sales rise by 6.8% driven by strong oncology and neuroscience offerings, notably bolstered by the recent acquisition of CAPLYTA. The MedTech segment also performed well, with sales increasing by 6.8%, supported by growth in Cardiovascular and Vision franchises, including contributions from the Shockwave acquisition. Despite ongoing legal matters, particularly related to talc and opioids, the company's financial strength and operational efficiency continue to drive shareholder value.

Financial Highlights

51 data points
Beta

Revenue

$23.99B

69.6% Gross Margin

Net Income

$5.15B

21.5% Net Margin

EPS (Diluted)

$2.12

Total Assets

$192.82B

Cash & Equivalents

$18.23B

Free Cash Flow

$8.01B

Financial Statements
Beta
Revenue$23.99B
Cost of Revenue$7.30B
Gross Profit$16.69B
SG&A Expenses$5.92B
Net Income$5.15B
EPS (Basic)$2.14
EPS (Diluted)$2.12
Shares Outstanding (Basic)2.41B
Shares Outstanding (Diluted)2.43B

Key Highlights

  • 1Total sales for the fiscal third quarter increased by 6.8% to $24.0 billion, compared to $22.5 billion in the prior year.
  • 2Net earnings significantly increased to $5.2 billion, or $2.12 per diluted share, a substantial rise from $2.7 billion, or $1.11 per diluted share, in the same period last year.
  • 3The Innovative Medicine segment reported sales of $15.6 billion, up 6.8% operationally, driven by strong performance in Oncology and Neuroscience, with the CAPLYTA acquisition contributing positively.
  • 4The MedTech segment achieved sales of $8.4 billion, an increase of 6.8% operationally, supported by growth in Cardiovascular and Vision franchises, including contributions from the Shockwave acquisition.
  • 5Research and Development expenses decreased by 25.8% year-over-year to $3.7 billion, reflecting a more normalized spending level after significant investments in prior periods.
  • 6The company's cash and cash equivalents stood at $18.2 billion as of September 28, 2025, providing ample liquidity.
  • 7Positive currency impacts and strategic acquisitions contributed to the overall sales growth, underscoring effective strategic execution.

Frequently Asked Questions

Revenue growth was primarily driven by strong performance across both the Innovative Medicine and MedTech segments. Key drivers included the continued strong sales of Oncology and Neuroscience products within Innovative Medicine, notably boosted by the acquisition of CAPLYTA, and growth in the Cardiovascular and Vision franchises within MedTech, benefiting from the Shockwave acquisition. Operational growth, positive currency impacts, and strategic pricing actions also contributed significantly.

Both acquisitions had a positive impact on the reported results. The Intra-Cellular Therapies acquisition, adding CAPLYTA to the Innovative Medicine portfolio, contributed to sales growth. The Shockwave acquisition bolstered the Cardiovascular franchise within the MedTech segment, contributing to its overall sales increase. These acquisitions were noted as having a net positive impact on operational sales growth for both segments.

Johnson & Johnson continues to actively manage its legal matters. While specific financial impacts are noted (e.g., reversal of talc reserves following a Texas court dismissal), the company reiterates its belief in the safety of its talc products and is defending its position in the tort system. For opioid litigation, a significant portion of the settlement has been paid, and the company continues to defend remaining cases. Management believes that the ultimate outcome of these legal proceedings, net of liabilities accrued, is not expected to have a material adverse effect on the company's financial position, though it may impact results of operations and cash flows in a given period.

R&D expenses decreased significantly in the third quarter of fiscal 2025 compared to the prior year. This decrease is attributed to a more normalized spending level after substantial investments in prior periods, including the significant expense incurred in the prior year for the Yellow Jersey acquisition. While overall R&D spending decreased as a percentage of sales, the company continues to invest in its pipeline, particularly within the Innovative Medicine segment.