On Tuesday, Pfizer Inc. PFE released its full-year 2025 financial guidance, projecting revenues between $61.0 billion and $64.0 billion compared to a consensus of $63.28 billion.
For 2025, Pfizer expects revenue from COVID-19 products to remain consistent with 2024, excluding approximately $1.2 billion in one-time Paxlovid revenue recognized in 2024.
The guidance accounts for an estimated $1 billion net unfavorable revenue impact due to changes under the Inflation Reduction Act (IRA), particularly Medicare Part D redesign.
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While IRA provisions like the $2,000 annual out-of-pocket cap are expected to benefit revenues, these are offset by eliminating the Coverage Gap Discount Program and adding manufacturer discounts in certain coverage phases.
The company projects operational revenue growth of flat to 5% year-over-year from the midpoint of 2024 baseline guidance, excluding non-recurring items.
On expenses, Pfizer anticipates full-year 2025 adjusted Selling, Informational, and Administrative expenses of $13.3 billion and $14.3 billion, while adjusted R&D expenses are expected between $10.7 billion and $11.7 billion.
Pfizer estimates total adjusted SI&A and R&D expenses to fall between $24.0 billion and $26.0 billion, reflecting $4.0 billion in savings from its cost realignment program by the end of 2024 and an additional $500 million in savings expected in 2025.
For adjusted EPS, Pfizer projects $2.80 to $3.00 in 2025, reflecting anticipated operational growth of 10% to 18% year-over-year from the midpoint of 2024 baseline guidance.
The expected improvement is attributed to higher revenues, improved operating margins driven by ongoing cost management, and the non-recurrence of one-time items that boosted 2024 adjusted EPS by approximately $0.30.
These items included $1.2 billion in Paxlovid revenue and the removal of Haleon equity method income following the reduction of Pfizer’s ownership stake in the fourth quarter of 2024.
The company also reaffirmed its 2024 full-year 2024 guidance.
Dr. Albert Bourla, Pfizer Chairman and Chief Executive Officer, stated: “Pfizer is in a strong position to continue making a positive impact for patients and delivering on our financial commitments in 2025.”
He added, “We also expect to continue improving our operating margins with focused financial discipline. We’ve been successful in delivering on our goal of $4 billion in net operating expense savings through 2024 from our cost realignment program, with an additional $500 million still expected to come in 2025. Additionally, in support of our ongoing efforts to improve gross margin performance, we will work to make additional progress with our Manufacturing Optimization Program in the coming year.”
On the conference call, the company said it does not expect material U.S. policy changes regarding vaccines from the incoming administration in 2025.
Price Action: At last check on Tuesday, PFE stock was up 2.46% to $25.87 during the premarket session.
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