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AstraZeneca’s 4Q17 Estimates: Segment Revenues

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AstraZeneca’s 4Q17 revenues

As we saw in the previous part, AstraZeneca’s (AZN) revenues are expected to decline 2.5% to $5.4 billion for 4Q17 compared to $5.6 billion in 4Q16. Nearly 60% of its total revenues are reported from sales outside the US markets, so it’s largely exposed to currency risk. For 4Q17, foreign exchange is expected to have a favorable impact on its overall revenues.

The above graph compares the revenues of AstraZeneca since 1Q16 and analysts’ estimates for 4Q17.

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Expectations for business segments

AstraZeneca’s business is classified into four segments. The expectations for each of the segments in 4Q17 are as follows:

  • The cardiovascular and metabolics diseases segment (or CVMD) includes Brilinta, Byetta, Atacand, Crestor, Seloken, and Farxiga. The segment’s revenues are expected to decrease in 4Q17 due to lower sales of Crestor and Byetta, partially offset by an increase in sales for Farxiga, Brilinta, and Seloken.
  • The oncology segment includes Iressa, Faslodex, Casodex, Arimidex, Lynparza, Zoladex, and Tagrisso. The segment’s revenues are expected to increase in 4Q17, driven by growth in sales of Lynparza, Tagrisso, Zoladex, and Faslodex, and partially offset by lower sales of Iressa.
  • The respiratory segment includes Daliresp, Tudorza, Symbicort, Pulmicort, and Duaklir. The segment’s revenues are expected to decrease in 4Q17 due to lower sales of Tudorza and Symbicort and partially offset by an increase in sales of Pulmicort, Daliresp, and Duaklir.
  • The other products segment includes Seroquel, Nexium, Synagis, and Losec. Revenues for these products are expected to decrease in 4Q17 due to lower sales of all the products in this segment.

The growth platforms

AstraZeneca’s growth platforms include the products and regions that contribute more than 65% of the company’s total revenues. Growth platforms include respiratory products, oncology products, and new CVMD products, as well as revenues from emerging markets and Japan.

The BLDRS Developed Markets 100 ADR ETF (ADRD) holds 17.4% of its total investments in healthcare companies. It holds 2% in AstraZeneca (AZN), 2.1% in GlaxoSmithKline (GSK), 2.3% in Sanofi (SNY), and 5.3% in Novartis AG (NVS).

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