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2025-07-29 18:32:12
[Merck Earnings Alert: Restructuring for Survival or Market Illusion?] ⑴ On the evening of July 29th, Merck released its second-quarter financial results, reporting sales of $15.81 billion and adjusted earnings per share of $2.13. ⑵ Core product performance varied. Sales of the cancer drug Keytruda increased 9% to $7.96 billion, while sales of the GARDASIL/GARDASIL 9 vaccine plummeted 55% to $1.13 billion. Sales of JANUVIA/JANUMET also fell 1% to $623 million, primarily due to declining market demand. ⑶ To address these challenges, Merck launched a new multi-year optimization plan, projected to achieve $3 billion in annual cost savings by the end of 2027. ⑷ The plan involves restructuring efforts aimed at streamlining administrative, sales, and R&D positions, and optimizing its global real estate and manufacturing network. $649 million in restructuring charges were incurred in the second quarter. ⑸ Despite the challenges, the company expects the restructuring to generate approximately $1.7 billion in annual cost savings, which will be fully reinvested in new product launches and its pipeline across multiple therapeutic areas. ⑹ In addition, Merck updated its full-year sales forecast to $64.3 billion to $65.3 billion and anticipates a negative foreign exchange impact of approximately $0.15 per share. ⑺ The $200 million cost impact associated with Trump's tariff rhetoric remains unchanged, adding uncertainty to future performance. ⑻ Looking ahead, whether Merck can successfully reverse the decline of some product lines through structural adjustments and new product launches will warrant continued market attention.
