Earnings

Eli Lilly (LLY) Q4 2025 Earnings — Core Brief Edition

Core-Brief

08 Feb 2026 — 3 min read

Headline: Lilly capped a blockbuster 2025 with +45% revenue growth and laid out 2026 guidance for $80–$83B revenue and $33.50–$35.00 EPS, balancing industry-leading volume growth against a low-to-mid-teens pricing headwind as obesity access expands (Medicare Part D) and orals arrive in Q2 2026.

Key Metrics (bulleted)

FY2025 revenue: $65.2B (+45% YoY).
FY2025 EPS (non-GAAP): $24.21 (+86% YoY).
Q4 revenue: +43% YoY (exact $ not stated).
Q4 gross margin: 83.2% (flat YoY).
Q4 R&D: +26% YoY (investment-led).
Q4 SG&A: +29% YoY (launch + promotion support).
Q4 non-GAAP operating margin: 47.2% (+4.2 pts YoY).
Q4 effective tax rate: 19.7%.
Q4 EPS (non-GAAP): $7.54 (includes $0.52 acquired IPR&D charges; vs $5.32 prior-year with $0.19 IPR&D).
Key products: contributed >$13B in Q4 revenue and grew +91% YoY (aggregate of key products; individual totals not fully enumerated).
US pricing: -7% price impact in Q4, with volume-led growth (notably Mounjaro + Zepbound).
Manufacturing: produced 1.8x more incretin doses in 2H25 vs 2H24; >$55B committed since 2020 to manufacturing buildout.
Lilly Direct: >1M patients engaged in 2025; Zepbound self-pay vials ~1/3 of new patient starts among branded obesity meds.
Capital returns (2025): $1.3B dividends + $1.5B share repurchases.

Segment & Strategy Highlights

Cardio-metabolic (Obesity/Diabetes):
- US branded obesity market: total prescriptions +33% YoY; penetration in eligible obesity population still mid-single digits (room to expand).
- Zepbound: US revenue >2x YoY; ~70% share of new prescriptions in branded obesity market (as stated).
- Zepbound vials: ~1/3 of total Zepbound prescriptions; ~50% of new Zepbound prescriptions in Q4.
- Mounjaro: >55% of new Rx share in US T2D incretin market exiting Q4; strong uptake outside US with broader launches.
- International Mounjaro: company said it became share leader in “total incretins” ex-US; 2026 focus = penetration + reimbursed expansion (China NRDL listed for T2D effective Jan 1, 2026).
Neuroscience:
- Alzheimer’s therapy referenced as US market leader in amyloid-targeting space with >50% share of total prescriptions.
- Revenue cited: $109M (product name unclear in transcript).
Immunology:
- Atopic dermatitis franchise: US total prescriptions +25% vs Q3 2025; global revenue +55% YoY.
- Taltz global sales +30% YoY; Japan strong.
- Growing emphasis on incretin + immunology combinations (see below).
Oncology:
- Pirtobrutinib (Jaypirca): global sales +55% YoY; expanded US indication (post covalent BTK inhibitor) increases eligible pool.
- Verzenio global sales +3%; early breast cancer penetration plateauing in US.
- Multiple Phase 3 data points highlighted for pirtobrutinib (large risk-reduction figures in CLL trials) and additional trials coming.

Product, Tech, AI / Blockchain

AI: Lilly announced collaboration with NVIDIA to open a co-innovation AI lab to accelerate drug discovery; continuing to invest in AI + new supercomputer.
Oral obesity (orforglipron): positioned as market-expanding (more “new starts”), with a simpler real-world regimen (no food/water restrictions highlighted).
Device/Presentation: Zepbound approved in the US in a multi-use KwikPen; launch expected “within the next few weeks.”

Credit & Risk

Not a major focus in this transcript. Key watch-items were pricing headwinds (US + international) and coverage dynamics (Medicaid reductions in 2026; new states possibly adding in 2027).

Balance Sheet & Capital

Manufacturing buildout: >$55B committed since 2020; new sites in the US/Europe; began production at new Wisconsin + North Carolina sites.
Shareholder returns (2025): $1.3B dividends; $1.5B repurchases.

Guidance / Outlook (explicit)

FY2026 revenue: $80–$83B (midpoint $81.5B, +25% vs FY2025).
FY2026 non-GAAP operating margin: 46.0%–47.5% (stable to slightly down vs Q4’s 47.2%, per commentary).
FY2026 EPS: $33.50–$35.00.
Pricing outlook: expected low-to-mid-teens drag on growth (US: Medicare access agreement, DTC/Zepbound changes, lower Medicaid prices for later lifecycle meds; ex-US: China NRDL impact).
Obesity Medicare access: expected effective no later than July 1, 2026, with a stated $50/month patient out-of-pocket; ramp builds over time.
orforglipron US launch: targeted Q2 2026 for chronic weight management; most international launches in 2027 (with some exceptions/earlier markets).
Medicaid: expects reduced coverage in 2026 due to some states (e.g., California) removing obesity coverage; expects additional states may add coverage in 2027.

Bottom Line

Lilly is explicitly framing 2026 as another volume-driven year: obesity/diabetes momentum plus new access channels (Medicare) and an oral launch should expand the treated population, even as pricing becomes a bigger headwind. Profitability remains high (Q4 47.2% op margin; 2026 guide 46–47.5%) while R&D spend ramps to feed a broad late-stage pipeline (including next-gen incretins and multi-indication expansion).