10-QPeriod: Q1 FY2024

PFIZER INC Quarterly Report for Q1 Ended Mar 31, 2024

Filed May 8, 2024For Securities:PFE

Summary

Pfizer Inc. (PFE) reported its first-quarter 2024 financial results, showing a notable decrease in total revenues to $14.9 billion from $18.5 billion in the prior year period, a 20% decline driven primarily by lower sales of its COVID-19 products, Comirnaty and Paxlovid. Excluding these, total revenues saw an operational increase of 11%, bolstered by the recent acquisition of Seagen, continued growth in the Vyndaqel family and Eliquis, and the launch of Abrysvo for older adults. Net income attributable to Pfizer Inc. common shareholders significantly decreased to $3.1 billion, or $0.55 per diluted share, compared to $5.5 billion, or $0.97 per diluted share, in the first quarter of 2023. The company continues to manage its cost base, announcing a multi-year enterprise-wide cost realignment program expected to yield at least $4 billion in net cost savings by 2024. Integration of the Seagen acquisition, which closed in December 2023, is ongoing and is expected to generate approximately $1 billion in annual cost synergies by 2026. Pfizer also reported a substantial decrease in operating cash flow, alongside strategic actions such as the partial sale of its Haleon investment, generating $3.5 billion in proceeds.

Financial Highlights

52 data points
Beta

Revenue

$14.88B

77.3% Gross Margin

Net Income

$3.12B

20.9% Net Margin

EPS (Diluted)

$0.55

Total Assets

$221.09B

Cash & Equivalents

$719.00M

Free Cash Flow

$386.00M

Financial Statements
Beta
Revenue$14.88B
Cost of Revenue$3.38B
Gross Profit$11.50B
SG&A Expenses$3.50B
Interest Expense$790.00M
Net Income$3.12B
EPS (Basic)$0.55
EPS (Diluted)$0.55
Shares Outstanding (Basic)5.66B
Shares Outstanding (Diluted)5.70B

Key Highlights

  • 1Total revenues decreased by 20% year-over-year to $14.9 billion, primarily due to a significant decline in COVID-19 product sales (Comirnaty and Paxlovid).
  • 2Excluding COVID-19 products, operational revenue increased by 11%, driven by contributions from the Seagen acquisition, growth in key products like Vyndaqel family and Eliquis, and new product launches such as Abrysvo.
  • 3Net income attributable to Pfizer Inc. common shareholders fell to $3.1 billion ($0.55/share) from $5.5 billion ($0.97/share) in the prior year period.
  • 4Operating cash flow decreased to $1.1 billion compared to $1.2 billion in Q1 2023.
  • 5The company is executing a cost realignment program targeting at least $4 billion in savings by 2024 and is projecting $1 billion in annual synergies from the Seagen acquisition by 2026.
  • 6Pfizer sold a portion of its investment in Haleon in March 2024, realizing $3.5 billion in proceeds.
  • 7Significant patent litigation and regulatory reviews remain ongoing for key products, including COVID-19 vaccines and treatments.

Frequently Asked Questions

The primary reason for the significant year-over-year revenue decrease is the substantial decline in sales of Pfizer's COVID-19 products, Comirnaty and Paxlovid. These products saw reduced demand and a transition from government contracts to traditional commercial market sales, leading to lower revenues.

Pfizer announced a multi-year, enterprise-wide cost realignment program aimed at aligning costs with long-term revenue expectations. This program is expected to deliver at least $4 billion in net cost savings by 2024. Additionally, integration of the Seagen acquisition is underway, with projected annual cost synergies of approximately $1 billion by 2026.

The acquisition of Seagen, which closed in December 2023, contributed to revenue growth in the first quarter of 2024, particularly within the oncology segment. The company is also working on integrating Seagen to achieve cost synergies and expects this acquisition to be a key driver for its oncology leadership goal.

Pfizer's condensed consolidated balance sheet shows cash and cash equivalents of $719 million and short-term investments of $11.2 billion as of March 31, 2024. The company reported operating cash flow of $1.1 billion for the quarter. Pfizer states it believes it has the ability to meet its liquidity needs for the foreseeable future through operating cash flows, financial assets, and access to capital markets.