How Did Amgen Perform in 3Q17?
Amgen revenue trends
In 3Q17, Amgen (AMGN) generated revenues of around $5.8 billion, which reflected a ~1% decline on a year-over-year (or YoY) basis and a ~1% decline on a quarter-over-quarter basis. In 3Q17, Amgen generated revenues of around $5.4 billion from product sales compared to $5.5 billion in 3Q16. In 3Q17, Prolia, Kyprolis, and Repatha primarily propelled the revenue growth, which was partially offset by the decline in Neupogen, Enbrel, and Epogen revenues.
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In 3Q17, Amgen reported non-GAAP (generally accepted accounting principles) operating income of around $3.0 billion compared to $2.9 billion in 3Q16. In 3Q17, non-GAAP operating income accounted for 55.6% of net product sales compared to 52.9% in 3Q16.
In 3Q17, Amgen reported non-GAAP net income of around $2.4 billion compared to $2.3 billion in 3Q16. In 3Q17, Amgen reported non-GAAP earnings per share (or EPS) of around $3.27 compared to $3.02 in 3Q16. In 3Q17, non-GAAP EPS witnessed 8% growth on a YoY basis. Higher operating margins were the main factor in the company’s EPS growth.
In 3Q17, Amgen reported the cost of product sales of around $735 million compared to $715 million in 3Q16. In 3Q17, Amgen reported R&D (research and development) expenses and SG&A (selling, general, and administrative) expenses of around $858 million and $1.1 billion, respectively, compared to $963 million and $1.2 billion in 3Q16.
2017 revenue guidance
After 3Q17, Amgen expects net revenues in fiscal 2017 to be in the range of $22.7 billion to $23.0 billion. Amgen anticipates earnings per share (or EPS) to be in the range of $12.50 to $12.70. Repatha and Kyprolis are expected to boost Amgen’s revenue growth.
AbbVie (ABBV), Celgene (CELG), and Johnson & Johnson (JNJ), Amgen’s peers in the rheumatology drugs market, generated revenues of around $7.0 billion, $3.2 billion, and $19.7 billion, respectively, in 3Q17.
The revenue growth of Amgen could boost the share prices of the Health Care Select Sector SPDR Fund (XLV). Amgen makes up about ~3.9% of XLV’s total portfolio holdings.