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INCYTE CORP (INCY)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 total GAAP revenues were $1.37B, up 20% year-over-year; GAAP diluted EPS was $2.11 and Non-GAAP diluted EPS was $2.26, reflecting strong operating leverage from 19% net product revenue growth and 204% YoY increase in GAAP operating income; both revenue and EPS materially beat Wall Street consensus (Revenue $1.25B*, EPS $1.64*) .
  • Guidance raised: FY25 net product revenue to $4.23–$4.32B, Jakafi to $3.050–$3.075B, and other oncology products to $550–$575M; Opzelura guidance maintained at $630–$670M .
  • Commercial highlights: Jakafi net revenue $791M (+7% YoY) on +10% paid-demand growth; Opzelura $188M (+35% YoY) with improved PBM placement; Niktimvo $46M (+27% QoQ), now adopted by ~90% of U.S. BMT centers .
  • Near-term stock reaction catalysts: first mCALR (INCA033989) MF data at year-end, EU filing for Opzelura moderate AD by year-end, and advancing TGFβR2×PD‑1 (INCA33890) toward first-line MSS CRC registrational program in 2026 .

What Went Well and What Went Wrong

  • What Went Well

    • “Our third-quarter results demonstrate strong growth across our product portfolio, with net product revenues increasing 19% year-over-year,” said CEO Bill Meury, underscoring broad-based commercial momentum across Jakafi, Opzelura, and GVHD assets .
    • Jakafi demand robust across MF, GVHD, and PV; paid demand rose 10% YoY, and FY25 Jakafi guidance increased to $3.050–$3.075B, supported by PV thrombosis-free survival data driving earlier intervention .
    • Opzelura execution: $188M (+35% YoY), with two dedicated sales teams, improved formulary placement at two of the three largest PBMs, and strong ex‑U.S. growth ($44M; +117% YoY) on rapid adoption across France, Spain, Italy, and Canada .

  • What Went Wrong

    • Cost pressure: GAAP/non-GAAP cost of product revenues rose 15%/16% YoY to $99.0M/$92.7M, driven by net product revenue growth, Niktimvo profit share, and manufacturing costs .
    • SG&A increased 6%/11% YoY to $329.1M/$308.0M, reflecting international marketing and launch support; management aims to balance growth investments with margin discipline .
    • Pipeline rationalization: paused anti‑CD122 (INCA034460), BET inhibitor (INCB57643), and povorcitinib in CSU due to prioritization and an onerous regulatory bar, raising questions about breadth vs. focus of pipeline (near term, strategic clarity improves) .

Financial Results

  • Consolidated Results vs prior quarters
MetricQ1 2025Q2 2025Q3 2025
Revenue (GAAP, $USD Billions)$1.05 $1.22 $1.366
GAAP Diluted EPS ($)$1.16*$1.57*$2.11
Non-GAAP Diluted EPS ($)N/AN/A$2.26
GAAP Operating Income ($USD Millions)N/AN/A$443.5

Note: *Values retrieved from S&P Global.

  • Margins trend
MetricQ1 2025Q2 2025Q3 2025
EBIT Margin (%)20.65%*25.63%*31.63%*
Gross Profit Margin (%)55.00%*52.80%*55.67%*

Note: *Values retrieved from S&P Global.

  • Segment/Product Revenue Breakdown
ProductQ3 2024 ($MM)Q2 2025 ($MM)Q3 2025 ($MM)
Jakafi$741.2 $764.0 $791.1
Opzelura$139.3 $164.0 $188.0
Niktimvo— $36.0 $45.8
Total Net Product Revenues$963.0 $1,060.0 $1,149.9
Total Royalty Revenues$156.9 N/A$171.1
Milestone & Contract Revenues$18.0 N/A$45.0
  • Operating Expense Summary (Q3 2025 vs Q3 2024)
MetricQ3 2024 ($MM)Q3 2025 ($MM)Δ YoY
GAAP Cost of Product Revenues$86.0 $99.0 +15%
GAAP R&D$573.2 $506.6 -12%
GAAP SG&A$309.2 $329.1 +6%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Jakafi Net Product RevenuesFY 2025$3.00–$3.05B $3.050–$3.075B Raised
Opzelura Net Product RevenuesFY 2025$630–$670M Unchanged Maintained
Other Oncology Net Product RevenuesFY 2025$500–$520M $550–$575M Raised
GAAP Cost of Product RevenuesFY 20258–9% of net product rev. Unchanged Maintained
Non-GAAP Cost of Product RevenuesFY 20257–8% Unchanged Maintained
GAAP R&D ExpensesFY 2025$1.965–$1.995B Unchanged Maintained
Non-GAAP R&D ExpensesFY 2025$1.815–$1.840B Unchanged Maintained
GAAP SG&A ExpensesFY 2025$1.280–$1.310B Unchanged Maintained
Non-GAAP SG&A ExpensesFY 2025$1.160–$1.185B Unchanged Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2 2025)Current Period (Q3 2025)Trend
Pipeline prioritizationFramework to score programs; focus on novel biology; pauses possible Paused anti‑CD122, BET; discontinued povorcitinib CSU; focus on high-PTRS programs Sharpened focus; streamlined
mCALR (INCA033989)ET phase 1 showed platelet normalization, translational markers; MF data at year-end planned MF data previewed: will show monotherapy & add-on endpoints; pivotal in ET 1H26; ENABLE enFuse partnership for SC delivery Acceleration; device strategy
Dermatology (Opzelura)Pediatric AD approval guided; ex‑US ramp; plan EU moderate AD filing TRuE‑AD4: Week‑8 EASI‑75 70% and IGA‑TS 61% → EU Type‑II filing by year-end Label expansion; EU growth
GVHD (Niktimvo)Launch off to strong start; J‑code tailwind; 82% penetration $46M, +27% QoQ; 90% BMT centers adopted; repeat orders; 800 patients YTD; combo trials (Jakafi, steroids) advancing Strong uptake; earlier-line push
Solid tumorsCDK2 ovarian pivotal path; KRAS G12D and TGFβR2×PD‑1 POC data planned TGFβR2×PD‑1: ORR 15% in MSS CRC; registrational 2026; KRAS G12D ORR 34% in PDAC at 1200mg De-risked; moving to pivotal
Cost disciplineManage OpEx < revenue growth; margin focus post-settlement Multi-year margin improvement expected; ring-fencing growth drivers; “good costs vs bad costs” Margin expansion path
Tariffs/supply chainMinimal tariff exposure; dual manufacturing footprints No new issues noted [—]Stable

Management Commentary

  • “We are taking a deliberate approach to pipeline prioritization… focusing on high-value programs that are scientifically differentiated… and have the potential to significantly drive Incyte’s next phase of growth.” — Bill Meury, CEO .
  • “Jakafi Q3 sales reached $791 million, a 7% increase, with strong demand growth of 10% year over year… we’re raising our full-year guidance for Jakafi…” .
  • “Internationally, sales for Opzelura and vitiligo total $44 million, representing a 117% increase from last year… file an application for [moderate AD] in the EU by year-end…” .
  • “We’re planning to start a pivotal phase 3 trial evaluating [INCA33890] in first-line MSS CRC in 2026.” — R&D lead .
  • “Incyte and Enable Injections… announced a new partnership to… use enFuse… with INCA033989 in ET and MF.” .

Q&A Highlights

  • mCALR efficacy expectations: Single-agent activity in MF is essential; benchmarks (e.g., momelotinib SVR35 7–22%) inform second-line expectations; co‑primary endpoints likely clinical (SVR35, TSS50), with anemia impact considered .
  • CSU discontinuation: Priorities and regulatory burden drove decision despite positive PoC; data likely presented at a future conference .
  • TGFβR2×PD‑1 registrational path: First-line MSS CRC with FOLFOX+BEV, PFS primary, study size north of 500; enablement combos underway .
  • Niktimvo sustainability/profitability: Annualizing near $200M; high contribution margin and repeat ordering support durable growth trajectory .
  • XR strategy: Focused on once-daily convenience; targeted 15–30% IR conversion by 2028, supporting revenue preservation pre-generic .

Estimates Context

  • Actuals vs S&P Global consensus
MetricQ1 2025Q2 2025Q3 2025
Revenue Consensus ($MM)997.6*1,151.6*1,254.2*
Revenue Actual ($MM)1,052.9*1,215.5*1,366.0
EPS Consensus ($)1.033*1.473*1.637*
EPS Actual (GAAP, $)1.16*1.57*2.11

Note: *Values retrieved from S&P Global.

  • Q3 2025 featured a significant beat: Revenue +$111.8M vs consensus and EPS +$0.47 vs consensus, driven by Jakafi demand, Opzelura growth, Niktimvo uptake, and milestone revenue; estimate revisions likely bias upward for FY25 net product revenue and Jakafi .

Key Business KPIs

KPIQ2 2025Q3 2025
Jakafi paid-demand YoY growth+8% +10%
Opzelura ex‑U.S. net sales ($MM)$32 $44
Niktimvo adoption (% BMT centers)~82% penetration ~90%, all repeat orders YTD
Niktimvo patients on therapy (YTD)~700 ~800 (tracking to 1,000 YE)

Non-GAAP Adjustments and Accounting Notes

  • Non-GAAP excludes stock-based comp (R&D/SG&A/COGS), amortization of acquired product rights, change in fair value of contingent consideration, and the Novartis contract dispute settlement; tax effects applied using estimated annual effective rate .
  • Settlement with Novartis recorded $242.2M (nine months), affecting COGS and royalties; lowered COGS guide and improved operating leverage in 2025 .

Implications and “Why”

  • Beat drivers: Strong core demand (Jakafi +10% demand), Opzelura growth aided by PBM coverage and international launches, Niktimvo launch momentum and milestone revenue lift; OpEx growth < revenue growth expands margins .
  • Guidance raise rationale: Sustained demand for Jakafi and hematology/oncology portfolio; Opzelura maintained pending EU moderate AD expansion .
  • Strategic focus: Streamlining to concentrate capital on mCALR, XR, derm franchise, and de-risked solid tumor assets, positioning for post‑2029 durability .

Key Takeaways for Investors

  • Q3 print was a clean beat on revenue and EPS; operating leverage improving as revenue growth outpaces OpEx — positive for near-term sentiment and FY25 guide credibility .
  • Jakafi remains the cash engine; PV emerging as largest driver. Watch ASH MF data for mCALR to gauge pathway to pivotal and potential disease-modifying profile (front-line combo path) .
  • Opzelura trajectory strengthens with EU moderate AD filing backed by robust TRuE‑AD4 outcomes; monitor ex‑U.S. ramp and potential label expansion to sustain double-digit growth .
  • Niktimvo launch quality (penetration, persistence, repeat orders) supports upward estimate revisions; combo trials (Jakafi, steroids) are binary catalysts for earlier-line expansion .
  • Oncology pipeline de-risking: TGFβR2×PD‑1 and KRAS G12D show compelling early efficacy and combinability; 2026 registrational start could add medium-term optionality .
  • Margin expansion thesis intact: cost discipline, settlement tailwind to COGS, and leverage from sustained topline growth .
  • Near-term trading setup: ASH mCALR readout, EU Opzelura filing, and visible Niktimvo trajectory are catalysts; any strong MF data could reset medium-term pipeline value perception .
S&P Global disclaimer: Estimate and margin values marked with * are retrieved from S&P Global/Capital IQ consensus and fundamentals.