BRISTOL MYERS SQUIBB CO (BMY) Q2 2025 Earnings Summary

Executive Summary

• Q2 2025 delivered a clean beat on both revenue and EPS vs Street: revenues $12.27B vs ~$11.38B consensus; non-GAAP EPS $1.46 vs ~$1.10 consensus; EBITDA also above estimates, aided by strong Growth Portfolio brands and inventory build effects in select franchises. Bold beat drivers: Opdivo, Breyanzi, Reblozyl, Camzyos; BioNTech IPR&D charge reduced reported EPS by $0.57 but underlying performance remained strong .
• Management raised FY25 revenue guidance to $46.5–$47.5B, increased OI&E to ~$250M income, and trimmed non-GAAP EPS to $6.35–$6.65 to reflect the Q2 BioNTech IPR&D; operating expense outlook increased to ~$16.5B to fund BD and Growth Portfolio investments .
• Strategic actions were a key stock reaction catalyst: global co-dev/commercialization alliance with BioNTech for BNT327, RayzeBio licensing of OncoACP3, and creation of an immunology NewCo with Bain Capital to externalize five assets—shoring up late-2020s growth visibility while optimizing capital allocation .
• Execution narrative improved: Growth Portfolio +18% YoY to $6.60B; Legacy Portfolio declined less than previously expected (now -15% to -17%), with FY Revlimid sales raised to ~$3B; SG&A and R&D trended lower non-GAAP, confirming productivity initiatives, while gross margin compression reflected mix .
• Notable policy/commercial initiative: Eliquis direct-to-patient option (more than 40% discount to list) to improve affordability and reduce middlemen—framing a constructive policy stance and potential template for other brands .

What Went Well and What Went Wrong

What Went Well

• Growth Portfolio momentum: WW sales +18% to $6.60B, led by Opdivo (+7%), Reblozyl (+34%), Breyanzi (+125%), Camzyos (+87%), Opdualag (+21%), with strong U.S. and international demand and favorable FX in some lines .
• Strategic BD strengthening the pipeline: BioNTech alliance for BNT327 (PD‑L1/VEGF bispecific) positions BMY first/second in class; Philochem’s OncoACP3 augments radiopharma; Bain Capital NewCo to focus five immunology assets—management: “enhanced portfolio and pipeline” and “positioned to win commercially” .
• Clear guidance raise despite IPR&D headwind: FY revenue +$0.7B at midpoint to $46.5–$47.5B; OI&E increased to ~$250M income; Legacy decline moderated; CFO reiterated productivity initiatives funding “up-invest” in growth areas .

What Went Wrong

• Non-GAAP gross margin fell to 72.6% (from 75.6% YoY) on product mix; GAAP gross margin declined to 72.5% (from 73.2%) .
• Reported EPS burdened by $1.5B acquired IPR&D (BioNTech) → $0.57/sh negative impact; non-GAAP EPS $1.46 down YoY (from $2.07) largely due to this charge .
• Select indications faced headwinds: Abecma (-8% WW); Zeposia flat WW; legacy erosion continued (Revlimid -38%, Pomalyst -26%), though moderation vs prior expectations was flagged; Sprycel down -72% WW on U.S. generics .

Financial Results

Results vs Consensus (S&P Global):

Values retrieved from S&P Global. (*)

Segment breakdown (selected):

KPIs:

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “We are making good progress rewiring the company for long-term growth… delivered strong results across our Growth Portfolio, continued to optimize our cost structure, and added to our innovative pipeline with strategic partnerships.” – CEO Chris Boerner .
• On BioNTech alliance: “Positioned to be first or second… speed to market is critical; leveraging our commercial infrastructure to accelerate and broaden development” .
• CFO on capital allocation: “$13.9B cash; on track to pay down ~$10B debt by first half of 2026… productivity initiatives enable up-invest behind growth portfolio and BD” .
• On Cobenfy adoption: “Tracking over 2,000 weekly TRx; expanding prescriber base; phase 4 switch study reads out end of year” .

Q&A Highlights

• BioNTech partnership differentiation: PD‑L1/VEGF bispecific specificity to tumor and speed-to-market focus intended to secure early leadership; leveraging BMY’s global clinical footprint .
• Cobenfy launch dynamics: focus on switching, prescriber breadth and hospital expansion; weekly TRx >2,000; management confident schizophrenia and Alzheimer’s programs can drive multi‑billion opportunity long term .
• Camzyos competition: label change eased echo burden; management sees no meaningful clinical differentiation from aficamten and expects to maintain leadership .
• Milvexian: differentiated dosing strategy across AF (100 mg bid) vs SSP/ACS (25 mg bid) to balance efficacy/bleeding risk; large commercial opportunity across undertreated populations .
• Macro/policy: Eliquis direct-to-patient program (more than 40% discount to list) as affordability lever and “cut out middlemen” approach; broader platform potential under evaluation .

Estimates Context

• Q2 2025 beats: revenue $12.27B vs ~$11.38B consensus (beat); EPS $1.46 vs ~$1.10 consensus (beat); EBITDA ~$5.12B vs ~$3.08B consensus (beat). Count of estimates: EPS (21), revenue (19). Values retrieved from S&P Global. (*) .
• Implications: Street models likely move higher on Growth Portfolio strength (Opdivo, Breyanzi, Reblozyl, Camzyos), moderated legacy decline (Revlimid to ~$3B FY), and higher OI&E, partially offset by higher OpEx and inclusion of Q2 IPR&D charge in EPS guidance .

Key Takeaways for Investors

• Bold beat: BMY materially outperformed consensus on revenue/EPS/EBITDA; underlying demand, favorable FX, and some inventory phasing supported the beat .
• Guidance raise: FY25 revenue increased $0.7B at midpoint; OI&E lifted; EPS framework reset to include BioNTech IPR&D—quality of earnings intact; operating margin non-GAAP ~37% unchanged .
• Growth Portfolio durability: multi-brand strength (Opdivo, Reblozyl, Breyanzi, Camzyos, Opdualag) offsetting legacy erosion better than expected (Legacy now -15–17% vs -16–18% prior) .
• Strategic pipeline positioning: BioNTech BNT327 alliance, radiopharma expansion (OncoACP3), and immunology NewCo create optionality and capital efficiency for late‑decade growth .
• Execution and balance sheet: $13.9B cash; net debt down to ~$35.2B; operating cash flow $3.9B; continued deleveraging and dividend continuity support defensive profile .
• Near-term trading catalysts: continued Growth Portfolio momentum, ADAPT‑2 Alzheimer’s psychosis readout timing update, Cobenfy phase 4 switch data, and visibility on late‑stage readouts through 2026–2027 .
• Monitor mix/margin: gross margin compression from product mix persisted; watch trajectory as legacy high‑margin brands roll off and Growth Portfolio mix evolves .