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Eli Lilly & Co.’s Revenues in 1Q17

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Eli Lilly & Co.’s revenues

Eli Lilly & Co. (LLY) reported 7% growth in its 1Q17 revenues to ~$5.2 billion, compared to ~$4.9 billion in 1Q16. The chart below shows Eli Lilly & Co.’s revenues since 1Q15.

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Revenues and profitability

Eli Lilly (LLY) reported a 7% top-line increase in 1Q17 following the strong performance of its pharmaceuticals products including Cyramza, Forteo, Humalog, Strattera, and Trulicity.

However, due to the nondeductible expense of ~$858 million toward the acquisition of CoLucid Pharmaceuticals, LLY reported a net loss of $110.8 million for 1Q17. This acquisition was reported under the company’s acquired in-process research and development charges (or IPRD). Overall, its lower operating income also impacted its profit margin during 1Q17.

Geographical performance

Geographically, the US market contributed nearly 56% of Eli Lilly’s total revenues for 1Q17. The company’s reported growth was 15% to ~$2.9 billion during 1Q17, mainly driven by pharmaceutical products and companion animal products. 

The company’s revenues from international markets decreased marginally to $2.29 billion for 1Q17, compared to $2.31 billion in 1Q16. The decrease in revenues for international markets was driven by the lower sales and lower realized prices for the drugs Cymbalta in Europe and Canada, Zyprexa in Japan, and Alimta in few countries due to loss of exclusivity.

For broad-based exposure to the industry, investors can consider the Fidelity MSCI Healthcare ETF (FHLC), which holds ~2.2% of its total assets in Eli Lilly. The Fidelity MSCI Healthcare ETF also holds 8.8% of its total assets in Johnson & Johnson (JNJ), 6.7% in Pfizer (PFE), and 5.3% in Merck & Co. (MRK).

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