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Merck Stock Slips After Earnings but Keytruda Sales Impress

New CEO Rob Davis says he's 'confident that we will deliver sustained long-term growth' following in-line second-quarter earnings.

Merck & Co.  (MRK) - Get Merck & Co., Inc. (MRK) Report posted better-than-expected second-quarter revenue Thursday, thanks in part to solid sales of its key cancer and HPV vaccine treatments. 

Merck said non-GAAP earnings for the three months ending in June were pegged at $1.31, down 4.4% from the same period last year but largely in-line with the Street consensus forecast. Group revenues, Merck said, rose 22% to $11.4 billion, topping analysts' estimates of an $11.1 billion tally. Sales for Keytruda, Merck's blockbuster cancer treatment, rose 23% to $4.2 billion while its Gardasil HPV vaccine sales rose 88% to $1.2 billion

Looking into the 2021 financial year, Merck said it sees worldwide sales of between $46.4 billion and $47.4 billion and non-GAAP earnings of between $5.47 and $5.57 per share.

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“We are encouraged by the strong momentum of our underlying business led by our key growth drivers as the impact of the pandemic on our performance lessens,” said new CEO Rob Davis. “We are confident that we will deliver sustained long-term growth and value creation enabled by our strengthening discovery research engine and by working with increased speed, urgency and agility to accelerate the delivery of our innovations to the patients who depend on them.”  

Merck shares were marked 1.6% lower in early trading  following the earnings release to change hands at $77.05 each, a move that would nudge the stock into negative territory for the year.

Merck had tapped Davis to replace outgoing CEO Ken Frazier, with the longtime boss transitioning to executive chairman of the company's board at the end of last month.