.July 30, 2024 11:47:00 AM

Merck (NYSE:MRK) exceeded expectations in the second quarter with an EPS of $2.28, beating estimates by $0.12, and revenue of $16.11 billion, surpassing the consensus of $15.85 billion. Despite this, the stock dropped around 10% intra-day.

Chairman and CEO Robert Davis credited Merck’s strong performance to successful launches like WINREVAIR and positive European opinions for PAH. Sales of KEYTRUDA, the flagship cancer drug, grew by 16% to $7.3 billion, significantly contributing to the quarter’s success.

Merck’s total worldwide sales rose by 7% year-over-year, driven by a favorable product mix and reduced royalty rates on key products like KEYTRUDA and GARDASIL/GARDASIL 9.

Looking forward, Merck has raised its full-year 2024 sales forecast to $63.4 billion to $64.4 billion, slightly below the Street estimate. However, the adjusted EPS guidance for the year is between $7.94 and $8.04, lower than the consensus estimate due to a one-time charge related to the acquisition of EyeBio.