47c7a3fa019a354ed3b9ce253d03d560e91a49b567edc3fccc246e98df5e2ed6

Adjustments for Non-Cash Items [USD, Millions]

Stock-Based Compensation [USD, Millions]

Changes in Working Capital [USD, Millions]

Capital Expenditures (USD, Millions)

Proceeds from / Repayments of Debt [USD, Millions]

Share Repurchases [USD, Millions]

Dividend Payments [USD, Millions]

Net Change in Cash [USD, Millions]

57d4413f90d399f670982a435d2918995075b9d31611fbb2c2927ed87547f014

Cash and cash equivalents (USD, millions)

Short‐term marketable debt securities (USD, millions)

Accounts receivable, net (USD, millions)

Inventories (USD, millions)

Prepaid and other current assets (USD, millions)

Total current assets (USD, millions)

Property, plant and equipment, net (USD, millions)

Long‐term marketable debt securities (USD, millions)

Intangible assets, net (USD, millions)

Goodwill (USD, millions)

Other long-term assets (USD, millions)

Total assets (USD, millions)

Accounts payable (USD, millions)

Accrued rebates (USD, millions)

Current portion of long‐term debt and other obligations, net (USD, millions)

Other current liabilities (USD, millions)

Total current liabilities (USD, millions)

Long‐term debt, net (USD, millions)

Long-term income taxes payable (USD, millions)

Deferred tax liability (USD, millions)

Other long-term obligations (USD, millions)

Total liabilities and stockholders’ equity (USD, millions)

Preferred stock (USD, millions)

Common stock (USD, millions)

Additional paid‐in capital (USD, millions)

Accumulated other comprehensive income (USD, millions)

Retained earnings (USD, millions)

Total Gilead stockholders’ equity (USD, millions)

Noncontrolling interest (USD, millions)

Total stockholders’ equity (USD, millions)

9ccbd84dcbb4435ab2064d4a334f6818d3c430b28d56b3839e9c6532855d8126

12032a02e93dd4cd4b2a13d8416d70372eff6cee7de5b47b08d4a4a88d8ed24c

167f946a3af74bf6b87ff6a427189bacd5e99bd9f161d95c3aed8c70890019f2

U.S.

Europe

Other International

- Japan

Rest of World

Total Revenue

9e086f8ac403e1806f655005d640f2fffc904210c8566a495969fc969f60c3dc

Number of countries in which Gilead operates (countries)

Number of participants in Phase 3 PURPOSE 2 lenacapavir group (participants)

Percentage of participants who did not acquire HIV infection in Phase 3 PURPOSE 2 lenacapavir group (percent)

Number of incident HIV infection cases in Phase 3 PURPOSE 2 lenacapavir group (cases)

Reduction in HIV infections compared to background incidence in Phase 3 PURPOSE 2 lenacapavir group (percent)

Relative risk reduction of HIV infection versus daily Truvada in Phase 3 PURPOSE 2 lenacapavir group (percent)

b07363c3a46ca8a0b6c833dceff0af304d050b8555a434bcf42646abbe6a5122

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Revenues: Product sales (USD, millions)

Revenues: Royalty, contract and other revenues (USD, millions)

Total revenues (USD, millions)

Costs and expenses: Cost of goods sold (USD, millions)

Costs and expenses: Research and development expenses (USD, millions)

Costs and expenses: Acquired in-process research and development expenses (USD, millions)

Costs and expenses: In-process research and development impairment (USD, millions)

Costs and expenses: Selling, general and administrative expenses (USD, millions)

Total costs and expenses (USD, millions)

Operating income (loss) (USD, millions)

Interest expense (USD, millions)

Other (income) expense, net (USD, millions)

Income (loss) before income taxes (USD, millions)

Income tax (benefit) expense (USD, millions)

Net income (loss) (USD, millions)

Net loss attributable to noncontrolling interest (USD, millions)

Net income (loss) attributable to Gilead (USD, millions)

Basic earnings (loss) per share attributable to Gilead (USD)

Shares used in basic earnings (loss) per share attributable to Gilead calculation (millions)

Diluted earnings (loss) per share attributable to Gilead (USD)

Shares used in diluted earnings (loss) per share attributable to Gilead calculation (millions)

f70c078ba18623eaa78d7c23d67c45d61b435ec29447ae28a29a1ceed81bb089

The surge in operating cash flow was driven by **higher product sales**—with total Q3 2024 revenue increasing by **7%** to **$7.5 billion**, particularly in the HIV, Veklury (remdesivir), Oncology, and Liver Disease segments—as well as **improved operating cash flow generation** (with Q3 2024 reaching **$4.3 billion**) and strict **operating expense management** measures.  **[0000882095-24-000025_exhibit991earningspressrel.htm:12]** **[0000882095-24-000025_exhibit991earningspressrel.htm:0]** 

What drove the surge in operating cash flow in Q3 2024?

Operating cash flow in Q2 2024 was unusually low because several factors combined to depress the cash inflows. Firstly, there was a significant impact from a **net loss of $2,556 million** for the six months ended June 30, 2024, compared to a **net income of $2,024 million** in the comparable period last year. Secondly, there were substantial non-cash adjustments that affected the operating cash flow, including a marked increase in **acquired in-process research and development expenses ($4,169 million)** and a notable **in-process research and development impairment ($2,430 million)**. Additionally, increases in **amortization expense** and **stock-based compensation expense**, along with various changes in operating assets and liabilities (such as accounts receivable, inventories, and accounts payable), further contributed to the drop in operating cash flow in Q2 2024.  **[0000882095-24-000022_gild-20240630.htm:6]** 

Why was operating cash flow unusually low in Q2 2024?

The **spike** in acquired in-process R&D expenses in Q1 2024 was primarily driven by the **CymaBay Acquisition**, which resulted in a **$3.9 billion** charge, and an additional **$100 million** recorded for the **Arcus Biosciences Collaboration**. These contributions are in contrast to the expenses in Q1 2023, which were significantly lower due to the **Tmunity Therapeutics Acquisition** and the **Arcellx Collaboration**.  **[0000882095-24-000013_gild-20240331.htm:28]** **[0000882095-24-000013_gild-20240331.htm:13]** **[0000882095-24-000013_gild-20240331.htm:25]** 

What caused the spike in acquired in-process R&D expenses in Q1 2024?

Gilead Sciences' net income turned sharply negative in Q1 2024 mainly due to **extraordinary charges**. The company incurred a **$3.9 billion IPR&D charge** related to its acquisition of CymaBay Therapeutics and a **$2.4 billion pre-tax impairment charge** on assets acquired from Immunomedics, Inc., which significantly impacted its overall financial performance. Additionally, **higher operating expenses**, rising from **$4.6 billion in Q1 2023 to $11.0 billion in Q1 2024**, compounded these effects, resulting in the substantial shift from a net income in Q1 2023 to a net loss in Q1 2024.  **[0000882095-24-000013_gild-20240331.htm:25]** **[0000882095-24-000010_exhibit991earningspressrel.htm:0]** **[0000882095-24-000010_exhibit991earningspressrel.htm:6]** 

Why did net income turn sharply negative in Q1 2024?

88b88a2f9181d3f07fe305f3789af22096d74245e9a7068dc82566bf2a588365

Gilead Sciences’ cash drop to **$2,772 million** in Q2 2024 compared to **$6,085 million** at the end of Q4 2023 was mainly due to several significant cash outflows. The company spent **$3.9 billion** on the acquisition of CymaBay Therapeutics, repaid **$1.75 billion** in senior notes, paid **$1.962 billion** in dividends, and repurchased **$500 million** of its common stock. Although these outflows were partially offset by **$3.544 billion** generated from operating activities and additional expenditures like capital expenditures and purchases of equity securities, the net effect was a substantial decrease in its cash and cash equivalents during the period.  **[0000882095-24-000022_gild-20240630.htm:35]** **[0000882095-24-000020_exhibit991earningspressrel.htm:0]** **[0000882095-24-000022_gild-20240630.htm:6]** 

Why did cash drop to 2,772 in Q2 2024?

The **decline in total assets to 53,579** in Q2 2024 was primarily driven by several factors. **First**, the **acquisition of CymaBay Therapeutics** led to a **$3.9 billion charge for in-process R&D**, which significantly lowered cash reserves. **Next**, there was a **$1.75 billion repayment of senior notes** that further reduced cash and equivalents. In addition, a **$2.4 billion impairment charge** related to intangible assets from the Immunomedics, Inc. acquisition contributed to diminishing the value of intangible assets, which fell from **26,454** to **22,832** million. Finally, a general reduction in cash and cash equivalents—from **6,085 million** to **2,772 million**—also played a substantial role. These combined actions resulted in the marked drop in total assets by Q2 2024.  **[0000882095-24-000022_gild-20240630.htm:2]** **[0000882095-24-000020_exhibit991earningspressrel.htm:0]** **[0000882095-24-000022_gild-20240630.htm:6]** 

What caused total assets to fall to 53,579 in Q2 2024?

Gilead Sciences’ retained earnings dropped to **$10,656 million** in Q1 2024 because the company recorded a **net loss of $4,170 million**. This loss was mainly driven by a **$3.9 billion IPR&D charge** related to the acquisition of CymaBay Therapeutics and a **$2.4 billion pre-tax impairment** of assets acquired from Immunomedics, Inc. Additionally, **$980 million in dividends** declared during Q1 2024 further reduced retained earnings.  **[0000882095-24-000013_gild-20240331.htm:5]** **[0000882095-24-000010_exhibit991earningspressrel.htm:0]** **[0000882095-24-000022_gild-20240630.htm:4]** 

Why did retained earnings drop to 10,656 in Q1 2024?

The decrease to **20,546 million** in Q3 2024 was primarily driven by **impairment charges** and **increased amortization**. Specifically, Gilead recorded significant impairment charges on its in-process research and development intangible asset related to sacituzumab govitecan-hziy for NSCLC due to unfavorable clinical trial outcomes, and there was an increase in accumulated amortization for finite-lived intangible assets (for example, the amortization for sofosbuvir increased from **7,050 million** to **7,574 million** and for Trodelvy from **2,002 million** to **2,813 million**), leading to the overall reduction in the net intangible assets.  **[0000882095-24-000028_gild-20240930.htm:3]** **[0000882095-24-000028_gild-20240930.htm:18]** 

What led to intangible assets decreasing to 20,546 in Q3 2024?

0b81b73b673389438bb42bf8f8c7c9af23e3a0f6b03e6035c7aa08776299026c

Gilead Sciences’ operating income turned sharply negative in Q1 2024 primarily due to two extraordinary charges: a **$3.9 billion acquired In-Process Research and Development (IPR&D) charge** related to the acquisition of CymaBay Therapeutics and a **$2.4 billion pre-tax impairment charge** for IPR&D from assets acquired from Immunomedics, Inc. Additionally, total costs and expenses more than doubled to **$11,008 million** compared to **$4,647 million** in Q1 2023, further contributing to the decline.  **[0000882095-24-000010_exhibit991earningspressrel.htm:0]** **[0000882095-24-000013_gild-20240331.htm:25]** 

Why did operating income turn sharply negative in Q1 2024?

The net loss in Q1 2024 was primarily driven by several extraordinary factors. **Gilead Sciences incurred a $3.9 billion IPR&D charge** related to the acquisition of CymaBay Therapeutics, and there was also a **$2.4 billion impairment charge** on assets acquired from Immunomedics. In addition, **total costs and expenses surged to $11.0 billion** (up from $4.6 billion the previous year), and unfavorable **tax implications**—stemming from the nondeductible nature of the acquisition charge which reduced the effective tax rate to 7.0% compared to 24.3%—further compounded the impact on net income.  **[0000882095-24-000010_exhibit991earningspressrel.htm:0]** **[0000882095-24-000013_gild-20240331.htm:25]** **[0000882095-24-000010_exhibit991earningspressrel.htm:6]** **[GILD_3380813_7]** 

What drove the net loss in Q1 2024?

EPS turned negative in Q1 2024 primarily because of **extraordinay charges**. Gilead incurred a **$3.9 billion non-deductible IPR&D charge** due to the acquisition of CymaBay Therapeutics, impacting diluted EPS by approximately **$3.14 per share**. Additionally, the company recorded a **$2.4 billion pre-tax impairment charge** on intangible assets from Immunomedics, impacting GAAP EPS by about **$1.46 per share**. These substantial charges, along with a significant increase in overall costs and expenses (rising from **$4.6 billion** to **$11.0 billion** year-over-year), overwhelmed the modest revenue growth, leading to the negative EPS result.  **[0000882095-24-000010_exhibit991earningspressrel.htm:0]** **[0000882095-24-000010_exhibit991earningspressrel.htm:6]** **[0000882095-24-000013_gild-20240331.htm:25]** **[GILD_3380813_7]** 

Why did EPS turn negative in Q1 2024?

The dramatic surge in total costs in Q1 2024 was primarily driven by several factors. **Acquired In-Process Research and Development (IPR&D) expenses** skyrocketed to **$4,131 million** due to a **$3.9 billion charge** for the acquisition of CymaBay Therapeutics, a steep increase from **$481 million** in Q1 2023.  **[0000882095-24-000010_exhibit991earningspressrel.htm:6]** **[0000882095-24-000010_exhibit991earningspressrel.htm:0]** **[0000882095-24-000013_gild-20240331.htm:28]**  Additionally, a significant **IPR&D impairment of $2,430 million** related to assets from Immunomedics further escalated costs.  **[0000882095-24-000010_exhibit991earningspressrel.htm:6]** **[0000882095-24-000010_exhibit991earningspressrel.htm:1]**  Increases in **cost of goods sold**, **research and development**, and **selling, general and administrative expenses**—attributable to product mix changes, higher intangible asset amortization, and restructuring expenses—also contributed to the overall rise in total costs.  **[0000882095-24-000010_exhibit991earningspressrel.htm:6]** **[0000882095-24-000013_gild-20240331.htm:27]** **[0000882095-24-000010_exhibit991earningspressrel.htm:1]** 

What caused the dramatic surge in total costs in Q1 2024?

The spike in acquired in-process R&D expenses in Q1 2024 was primarily driven by the **CymaBay Therapeutics acquisition**, which contributed about **$3.9 billion**. Additionally, an extra **$100 million** was recorded from the **Arcus Biosciences collaboration**. These factors collectively led to the substantial increase compared to prior periods.  **[0000882095-24-000013_gild-20240331.htm:28]** **[0000882095-24-000013_gild-20240331.htm:13]** 

Why did acquired in-process R&D expenses spike in Q1 2024?

7ad7000299f3ef08f2c6fb55a0c500377d5ea38b191cd73309356b1c27cedb7a

Gilead Sciences Inc (GILD)

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