uploads/2018/07/medicine-1309148_1280.jpg

Celgene Raises Revenue Guidance after Solid Growth in Q2 2018

By

Updated

Revenue trends

In the second quarter of 2018, Celgene (CELG) reported revenues of $3.8 billion, compared to $3.3 billion in the second quarter of 2017, reflecting ~17% growth on a year-over-year (or YoY) basis and ~8% growth sequentially.

Celgene’s top products Revlimid, Pomalyst, Otezla, and Abraxane generated revenues of $2.45 billion, $507.0 million, $375.0 million, and $243.0 million, respectively, reflecting ~21% growth, ~30% growth, ~5% growth, and a ~4% decline on a YoY basis.

Celgene reported GAAP net income and diluted earnings per share of $1.0 billion and $1.43, respectively.

The company reported an operating cash flow of $1.2 billion, compared to $1.6 billion in the second quarter of 2017.

Article continues below advertisement

Expense trends

Celgene reported GAAP research and development expenditure of $1.25 billion and selling, general, and administrative expenses of $790.0 million, compared to $835 million and $939.0 million in the second quarter of 2017, respectively.

The company reported a cost of goods sold, excluding the amortization of acquired intangible assets, of $126.0 million, compared to $111.0 million in the second quarter of 2017.

Updated guidance for 2018

After strong results in the second quarter of 2018, Celgene raised its full-year financial guidance. It raised its estimated net revenue guidance for 2018 from $14.8 billion to $15.0 billion. Celgene especially raised its revenue guidance for its top drug, Revlimid. The company expects Revlimid to generate revenue of $9.7 billion in fiscal 2018, compared to the prior estimate of $9.5 billion.

Celgene updated its GAAP operating margin to ~35% from its prior estimate of 38%. It increased its GAAP diluted EPS to $5.95–$6.25 from its prior estimate of $6.31.

Peers in the biopharmaceuticals market Eli Lilly (LLY), Johnson and Johnson (JNJ), and Novartis (NVS) reported revenues of $6.4 billion, $20.8 billion, and $13.2 billion, respectively.

The revenue growth at Celgene could boost the iShares Nasdaq Biotechnology ETF (IBB). Celgene makes up about ~7.5% of IBB’s total portfolio.

Advertisement

More From Market Realist