Amgen's Q2 Profit Dips Amid Increased Expenses Despite Revenue Surge

Amgen's second-quarter profit declined by 1% due to increased expenses, despite a 20% rise in revenue following its acquisition of Horizon Therapeutics. The company reported adjusted earnings of $4.97 per share, missing analyst estimates. Investors are focused on Amgen's experimental weight-loss drug, MariTide, which is expected to have mid-stage trial data by the end of the year.

Amgen reported a 1% decline in its second-quarter profit on Tuesday, attributing the drop to rising expenses that overshadowed a 20% rise in revenue driven by its acquisition of Horizon Therapeutics.

The biotechnology company reported adjusted earnings of $4.97 per share, just shy of the analyst consensus estimate of $5.00 per share, according to LSEG data. Revenue for the quarter hit $8.39 billion, slightly above the $8.37 billion forecast by analysts.

While Amgen's shares closed up 1% at $328.95, they fell 1.5% in after-hours trading.

Sales of Repatha, a cholesterol drug, rose 25% to $532 million. In contrast, sales of Enbrel, an older rheumatoid arthritis treatment, dropped 15% to $902 million. Horizon's drug Tepezza, for thyroid eye disease, saw a 7% increase in sales to $479 million, and gout medication Krystexxa's sales rose 20% to $294 million.

Excluding Horizon's products, overall product sales increased by 5%. However, net earnings for the quarter fell 46% to $1.38 per share due to higher operating expenses related to the Horizon deal and R&D activities.

Investor attention is now focused on Amgen's promising experimental weight-loss drug MariTide, with initial data from a mid-stage trial expected by year's end. CFO Peter Griffith emphasized the company's dedication to quickly launching a Phase 3 program for MariTide.

Analysts are optimistic about the weight-loss drug market, projecting it to reach $130 billion annually by the early 2030s. In light of its investment in MariTide and manufacturing, Amgen has raised its 2024 capital spending target to $1.3 billion, up from $1.1 billion.

The company also adjusted its 2024 revenue outlook, now forecasting between $32.8 billion and $33.8 billion, and narrowed its adjusted earnings estimate to a range of $19.10 to $20.10 per share.

Analysts have predicted earnings of $19.51 per share on $33.1 billion in revenue for 2024.

(Reporting by Deena Beasley in Los Angeles; Editing by Bill Berkrot)