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AbbVie Inc. (ABBV - Free Report) reported earnings of $2.83 per share for the third quarter of 2020, comfortably beating the Zacks Consensus Estimate of $2.75 and exceeding the guided range of $2.73-$2.74. Earnings rose 21.5% year over year.
Meanwhile, the company’s revenues of $12.9 billion beat the Zacks Consensus Estimate of $12.67 billion. The top line improved 52.1% year over year on a reported basis. However, on an operational basis, revenues increased 4.1%.
Please note that AbbVie completed the acquisition of Allergan in May 2020. Revenues include the first full-quarter of Allergan’s product revenues. AbbVie represented sales numbers as reported as well as on “comparable operational” basis, which included prior-year sales of Allergan’s products, as the acquisition closed on Jan 1, 2019, at constant currency rates.
AbbVie’s shares were up 1.4% in pre-market trading. AbbVie’s shares have gained 1.3% so far this year against the industry’s 1.7% decrease.
Quarter in Detail
Key drug Humira recorded sales increase of 4.4% on an operational basis with revenues from the same coming in at $5.14 billion. Sales in the United States climbed 7.7% to $4.19 billion. However, Humira sales in the ex-U.S. markets were down 8% on an operational basis and 9.3% on a reported basis to $951 million. International sales were affected by the launch of several direct biosimilar drugs in Europe by other pharma companies including Amgen (AMGN - Free Report) , Sandoz and Biogen.
New immunology drugs, Skyrizi and Rinvoq registered sales of $435 million and $215 million, respectively. In the previous quarter, Skyrizi and Rinvoq recorded sales of $330 million and $149 million, respectively. Strong sequential growth in sales of both drugs in the past couple of quarter reflects strong uptake.
AbbVie’s oncology/hematology (including Imbruvica and Venclexta) sales rose 16.4% on an operational basis to $1.72 billion in the quarter, driven by strong growth of both Imbruvica and Venclexta.
Third-quarter net revenues from Imbruvica were $1.37 billion, up 9% year over year. U.S. sales of Imbruvica grossed $1.12 billion, up 7.4% from the year-ago figure. AbbVie’s share of profit from International sales of the drug rose 17% to $251 million. Notably, AbbVie shares international profits earned from Imbruvica with Johnson & Johnson (JNJ - Free Report) .
The company’s leukemia drug Venclexta generated revenues of $352 million in the reported quarter, reflecting growth of 58.3% year over year on an operational basis. AbbVie has a partnership with Roche (RHHBY - Free Report) for Venclexta.
Other products that delivered an encouraging performance include Creon and Duodopa, which recorded revenue growth of 5.9% and 2%, respectively, on an operational basis. Lupron and Synthroid witnessed a revenue decrease of 41.3% and 3.6%, respectively. Orilissa sales were down 3.2% year over year. Sales of Mavyret were $414 million, down 41.1% operationally.
AbbVie added several drugs to its portfolio with the acquisition of Allergan. Key among them include multi-indication drug, Botox, and Vraylar. Botox is sold as a cosmetic as well as therapeutic. Botox Cosmetic net revenues were $393 million, down 2.2% on an operational basis. Botox Therapeutic net revenues decreased 1.8% to $523 million. However, Vraylar sales were up 48.4% to $358 million.
Adjusted SG&A expenses increased 68% to $2.72 billion while R&D expenses were $1.51 billion in the third quarter, rising 23.3% year over year. Adjusted operating margin represented 48.8% of sales.
2020 Guidance
AbbVie issued new EPS guidance for 2020, which includes results of Allergan from May 8 to Dec 31. The company now expects adjusted EPS to be in the range of $10.47-$10.49 compared with $10.35-$10.45 expected previously. The increase in earnings expectations reflect recovery in demand for AbbVie’s products following COVID-19 related disruption in the second quarter. The Zacks Consensus Estimate for current-year earnings per share is pegged at $10.42.
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AbbVie (ABBV) Beats on Q3 Earnings & Sales, Ups 2020 Guidance
AbbVie Inc. (ABBV - Free Report) reported earnings of $2.83 per share for the third quarter of 2020, comfortably beating the Zacks Consensus Estimate of $2.75 and exceeding the guided range of $2.73-$2.74. Earnings rose 21.5% year over year.
Meanwhile, the company’s revenues of $12.9 billion beat the Zacks Consensus Estimate of $12.67 billion. The top line improved 52.1% year over year on a reported basis. However, on an operational basis, revenues increased 4.1%.
Please note that AbbVie completed the acquisition of Allergan in May 2020. Revenues include the first full-quarter of Allergan’s product revenues. AbbVie represented sales numbers as reported as well as on “comparable operational” basis, which included prior-year sales of Allergan’s products, as the acquisition closed on Jan 1, 2019, at constant currency rates.
AbbVie’s shares were up 1.4% in pre-market trading. AbbVie’s shares have gained 1.3% so far this year against the industry’s 1.7% decrease.
Quarter in Detail
Key drug Humira recorded sales increase of 4.4% on an operational basis with revenues from the same coming in at $5.14 billion. Sales in the United States climbed 7.7% to $4.19 billion. However, Humira sales in the ex-U.S. markets were down 8% on an operational basis and 9.3% on a reported basis to $951 million. International sales were affected by the launch of several direct biosimilar drugs in Europe by other pharma companies including Amgen (AMGN - Free Report) , Sandoz and Biogen.
New immunology drugs, Skyrizi and Rinvoq registered sales of $435 million and $215 million, respectively. In the previous quarter, Skyrizi and Rinvoq recorded sales of $330 million and $149 million, respectively. Strong sequential growth in sales of both drugs in the past couple of quarter reflects strong uptake.
AbbVie’s oncology/hematology (including Imbruvica and Venclexta) sales rose 16.4% on an operational basis to $1.72 billion in the quarter, driven by strong growth of both Imbruvica and Venclexta.
Third-quarter net revenues from Imbruvica were $1.37 billion, up 9% year over year. U.S. sales of Imbruvica grossed $1.12 billion, up 7.4% from the year-ago figure. AbbVie’s share of profit from International sales of the drug rose 17% to $251 million. Notably, AbbVie shares international profits earned from Imbruvica with Johnson & Johnson (JNJ - Free Report) .
The company’s leukemia drug Venclexta generated revenues of $352 million in the reported quarter, reflecting growth of 58.3% year over year on an operational basis. AbbVie has a partnership with Roche (RHHBY - Free Report) for Venclexta.
Other products that delivered an encouraging performance include Creon and Duodopa, which recorded revenue growth of 5.9% and 2%, respectively, on an operational basis. Lupron and Synthroid witnessed a revenue decrease of 41.3% and 3.6%, respectively. Orilissa sales were down 3.2% year over year. Sales of Mavyret were $414 million, down 41.1% operationally.
AbbVie added several drugs to its portfolio with the acquisition of Allergan. Key among them include multi-indication drug, Botox, and Vraylar. Botox is sold as a cosmetic as well as therapeutic. Botox Cosmetic net revenues were $393 million, down 2.2% on an operational basis. Botox Therapeutic net revenues decreased 1.8% to $523 million. However, Vraylar sales were up 48.4% to $358 million.
Adjusted SG&A expenses increased 68% to $2.72 billion while R&D expenses were $1.51 billion in the third quarter, rising 23.3% year over year. Adjusted operating margin represented 48.8% of sales.
2020 Guidance
AbbVie issued new EPS guidance for 2020, which includes results of Allergan from May 8 to Dec 31. The company now expects adjusted EPS to be in the range of $10.47-$10.49 compared with $10.35-$10.45 expected previously. The increase in earnings expectations reflect recovery in demand for AbbVie’s products following COVID-19 related disruption in the second quarter. The Zacks Consensus Estimate for current-year earnings per share is pegged at $10.42.
AbbVie Inc. Price, Consensus and EPS Surprise
AbbVie Inc. price-consensus-eps-surprise-chart | AbbVie Inc. Quote
Zacks Rank
Currently, AbbVie is a Zacks Rank #3 (Hold) stock.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Have You Seen Zacks’ 2020 Election Stock Report?
The upcoming election could be a massive buying opportunity for savvy investors. Trillions of dollars will shift into new market sectors after the election. The question is, which sectors will soar for each candidate? Zacks has put together a new special report to help readers like you target big profits.
The 2020 Election Stock Report reveals specific stocks you’ll want to own immediately after the results are announced – 6 if Trump wins, 6 if Biden wins. Past election reports have led investors to gains of +71%, +83%, even +185% in the following months. This year’s picks could be even more lucrative.
Check out Zacks’ 2020 Election Stock Report >>