01—Abstract
Summary
Summary of the 8-K filed August 7, 2025. Cited figures are marked; the original filing is the authoritative source.
Eli Lilly reported second-quarter 2025 results that substantially beat the prior run-rate and prompted a raise to full-year guidance.
Revenue rose 38% year over year to $15.56 billiona, driven by volume growth of 42% that more than offset a 6% decline from lower realized prices. Growth was led by Zepbound (U.S. revenue up 172% to $3.38 billion) and Mounjaro (worldwide revenue up 68% to $5.20 billion). Gross margin expanded 3.5 points to 84.3% of revenue on improved cost of production and favorable mix.
Reported EPS rose 92% to $6.29b and non-GAAP EPS rose 61% to $6.31, both including a $0.14 acquired IPR&D charge. Reported net income was $5.66 billion, and R&D rose 23% to $3.34 billion, or 21.4% of revenue. Management raised 2025 revenue guidance by $1.5 billion at the midpoint to $60.0-62.0 billion.
Reported EPS guidance moved to $20.85c-22.10 and non-GAAP EPS guidance to $21.75-23.00. The reported EPS increase is partly offset by a higher expected reported tax rate of about 19% (from about 17%), which reflects a third-quarter charge tied to recently enacted U.S. tax legislation. Guidance includes $1.73 billion (about $1.86 per share) of acquired IPR&D charges incurred through Q2 and excludes any future IPR&D, so later deal activity could pressure reported results.
Guidance also assumes existing tariffs as of August 7, 2025, and does not reflect potential pharmaceutical-sector tariff changes. For investors, the key takeaways are the strength of the incretin franchise, the expansion of margins, and the earnings upgrade.
The filing also flags pipeline progress, including positive orforglipron obesity data and Mounjaro cardiovascular outcomes data in type 2 diabetes. Risks that remain include continued U.S. price erosion, tariff and tax policy uncertainty, and ongoing business development spending.
02—Key points
Key Highlights
- Q2 2025 revenue rose 38% to $15.56B, driven by a 42% volume increase partly offset by a 6% decline in realized prices.
- Zepbound U.S. revenue grew 172% to $3.38B and Mounjaro worldwide revenue grew 68% to $5.20B, together driving most of the growth.
- Gross margin reached 84.3% of revenue, up 3.5 percentage points, on better production costs and favorable mix.
- Reported EPS rose 92% to $6.29 and non-GAAP EPS rose 61% to $6.31, both after a $0.14 acquired IPR&D charge.
- 2025 revenue guidance raised by $1.5B at the midpoint to $60.0-62.0B; reported EPS guidance raised to $20.85-22.10 and non-GAAP EPS to $21.75-23.00.
- Reported tax rate guidance increased to about 19% from about 17%, reflecting a Q3 charge from recently enacted U.S. tax legislation.
- Guidance includes $1.73B of acquired IPR&D through Q2 and excludes future IPR&D, and assumes current tariffs as of August 7, 2025.
03—Questions
Frequently Asked Questions
What drove Lilly's revenue growth in Q2 2025?
Revenue grew 38% to $15.56 billion, mainly from volume growth of 42% led by Zepbound and Mounjaro. Lower realized prices reduced growth by about 6%. U.S. revenue rose 38% to $10.81 billion and revenue outside the U.S. rose 37% to $4.74 billion, with a small favorable foreign exchange impact.
Why did Lilly raise its guidance, and what offsets the raise?
Lilly raised 2025 revenue guidance to $60.0-62.0 billion, citing strong underlying performance across the portfolio and favorable foreign exchange. Reported EPS guidance rose, but the expected reported tax rate increased to about 19% because of a third-quarter charge from recently enacted U.S. tax legislation. The non-GAAP tax rate stays at about 17%.
Are there items that could affect future reported results?
Yes. Guidance excludes acquired IPR&D charges expected after Q2 2025, so new business development deals could reduce reported EPS. Guidance also reflects existing tariffs as of August 7, 2025, and does not include possible pharmaceutical-sector tariff changes. The Q3 tax charge is also already included in reported guidance.
How profitable was the quarter on an underlying basis?
Gross margin was 84.3% on a reported basis and 85.0% on a non-GAAP basis, with the improvement driven by production costs and product mix. Non-GAAP net income was $5.68 billion, and non-GAAP EPS was $6.31. Operating income on a reported basis rose 85% to $6.87 billion.
What are the key pipeline and regulatory developments mentioned?
Lilly reported positive orforglipron Phase 3 obesity results, Mounjaro SURPASS-CVOT cardiovascular data in type 2 diabetes, and a head-to-head Phase 3 win for Jaypirca over Imbruvica in CLL/SLL. Regulatory items included a CHMP positive opinion and an FDA label update for Kisunla, plus an FDA label update for Amyvid. The company also completed the acquisitions of SiteOne Therapeutics and Verve Therapeutics.
04—Continue