Novartis delivered a solid third quarter with headline beats on revenue and core earnings, despite significant generic erosion for older products. Core operating income margin expanded to 41.6%, a constant-currency increase of 2.0 percentage points, driven by strong uptake of priority brands and productivity efforts. However, IFRS net income was severely impacted by a $1.9 billion partial impairment charge following trial results for the del-desiran asset.
Key Highlights
- Core EPS of $2.46 beat the $2.25 consensus estimate, while revenue of $14.52 billion exceeded expectations.
- Priority growth drivers Kisqali (+37% cc), Scemblix (+67% cc), and Leqvio (+63% cc) provided substantial volume gains.
- Full-year 2026 guidance for core operating income was raised to 'in line to grow low single-digit,' up from a previous forecast of a low single-digit decline.
- IFRS operating income declined 61% to $1.8 billion, primarily due to the $1.9 billion impairment of the del-desiran IPR&D asset.