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Atripla's Good to Gilead

The company's HIV franchise lifts third-quarter earnings and revenue above expectations.

Gilead Sciences' (GILD) - Get Gilead Sciences, Inc. (GILD) Report strong HIV franchise helped push its third-quarter earnings and revenue easily past analysts' expectations.

Excluding items, Gilead earned 64 cents a share in the latest quarter, beating the Thomson First Call consensus of 56 cents. Revenue of $748.7 million also exceeded estimates of $706.8 million.

Including charges, the company lost 11 cents a share. Charges included $355.6 million for purchased in-process research and development incurred in the acquisition of Corus Pharma.

Gilead's new combination HIV therapy Atripla brought in $68 million in sales, trouncing the consensus estimate of $42 million. Atripla was approved by U.S. regulators in July.

Viread's $170 million in revenue was also stronger than analysts anticipated. Truvada recorded $309 million in sales, which was in line with expectations and was responsible for more than half of the company's $557 million in HIV revenue. Gross margins shrank to 84% from 86% due to the launch of Atripla.

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Gilead raised its full-year revenue guidance for its HIV franchise to a range of $2 billion to $2.05 billion from the old projection of $1.95 billion to $2 billion. The company also raised its research-and-development spending guidance to between $365 million and $385 million and narrowed its outlook for selling, general and administrative expenses to between $555 million and $575 million.

Shares of Gilead Sciences were trading slightly lower after hours.

In keeping with TSC's editorial policy, Lichtenfeld doesn't own or short individual stocks. He also doesn't invest in hedge funds or other private investment partnerships.

Marc Lichtenfeld was previously an analyst at Avalon Research Group and The Weiss Group and a trader at Carlin Equities. He holds NASD 86, 87, 7 and 63 licenses. His prior journalism experience includes being a reporter/anchor for On24 in San Francisco and a managing editor of InvestorsObserver, a personal finance Web site. He is a graduate of the State University of New York at Albany. He appreciates your feedback;

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