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    ABBV
    Earnings call· Mar 2025(Q1 FY25)

    AbbVie Inc. ABBV

    Apr 25, 2025 Source

    Executive summary

    AbbVie Q1 FY25 — Strong Ex-Humira Growth and Raised FY25 EPS Guidance

    AbbVie delivered a strong Q1 FY25, driven by exceptional performance from its ex-Humira portfolio, particularly Skyrizi and Rinvoq, leading to an upward revision of full-year EPS guidance. Despite faster-than-expected Humira erosion and ongoing macroeconomic pressures on aesthetics, the company is strategically investing in its pipeline, including new obesity programs and oncology ADCs, to secure long-term growth beyond its core immunology franchise. Management emphasized its robust U.S. manufacturing footprint and commitment to innovation amidst evolving policy landscapes.

    Highlights

    5

    • Adjusted EPS of $2.46, exceeding guidance midpoint by $0.10.

    • Total net revenues of over $13.3 billion, nearly $550 million ahead of expectations.

    • Ex-Humira platform delivered robust sales growth of more than 21%.

    • Skyrizi and Rinvoq combined sales of $5.1 billion, growing over 65%.

    • Full-year adjusted EPS guidance raised by $0.10 to $12.09-$12.29.

    Concerns

    3

    • Humira global sales of $1.1 billion, down 49.5% on an operational basis, below expectations due to faster biosimilar erosion and molecule compression.

    • Aesthetics global sales of $1.1 billion, down 10.2% on an operational basis, impacted by economic headwinds and moderated category growth assumptions.

    • Potential impact from sectoral tariffs not contemplated in guidance, with management acknowledging it could be in line with peers.

    Guidance & targets

    18
    CategoryTargetConfidence
    Full-year adjusted earnings per share
    $12.09-$12.29
    high materiality
    High
    Full-year total net revenues
    approximately $59.7 billion
    high materiality
    High
    Full-year Skyrizi global revenues
    $16.5 billion
    medium materiality
    High
    Full-year Rinvoq global sales
    $8.2 billion
    medium materiality
    High
    Full-year U.S. Humira revenues
    $3.5 billion
    high materiality
    High
    Full-year Botox Therapeutic global sales
    $3.6 billion
    medium materiality
    High
    Full-year total oral CGRP revenues
    $2.2 billion
    medium materiality
    High
    Full-year Imbruvica global revenues
    $2.8 billion
    medium materiality
    High
    Full-year Venclexta global sales
    $2.7 billion
    medium materiality
    High
    Full-year Aesthetics global sales
    $5.1 billion
    medium materiality
    High
    Full-year adjusted gross margin
    approximately 84% of sales
    medium materiality
    High
    Full-year adjusted SG&A expense
    approximately $13.2 billion
    medium materiality
    High
    Full-year adjusted R&D expense
    approximately $8.9 billion
    medium materiality
    High
    Full-year adjusted operating margin ratio
    roughly 46.5% of sales
    medium materiality
    High
    Q2 net revenues
    approximately $15 billion
    medium materiality
    High
    Q2 adjusted operating margin ratio
    roughly 49.5%
    medium materiality
    High
    Q2 adjusted earnings per share
    $3.26-$3.30
    high materiality
    High
    Revenue CAGR
    high single-digit
    high materiality
    High

    Segment performance

    5
    SegmentRevenueYoYQoQMargin
    Immunology
    Exceeded expectations, strong performance across IBD, dermatology, and rheumatology.
    Skyrizi & Rinvoq combined sales: $5.1BSkyrizi & Rinvoq combined growth: >65%Crohn's disease in-play patient capture (U.S.): ~1 in 2IBD total prescription share: mid-teensUlcerative colitis in-play patient capture: 1 in 3Skyrizi psoriatic disease in-play share: leading in nearly 30 countries
    		$6.2B———
    Humira
    Below expectations due to faster share erosion from biosimilar competition and molecule compression in the U.S.
    		$1.1B-49.5% operational——
    Oncology
    Exceeded expectations. Venclexta showed strong performance in CLL and AML. Imbruvica impacted by competitive dynamics.
    Imbruvica global sales: $738MImbruvica growth: -11.9%Venclexta global sales: $665MVenclexta growth: +12.3% operationalElahere global sales: $179M
    		$1.6B———
    Aesthetics
    In line with expectations, impacted by economic headwinds and moderated market growth assumptions. U.S. Botox market share gained 1 point back after initial loss due to Alle redesign.
    Botox Cosmetic global revenues: $556MBotox Cosmetic growth: -10.7% operationalJuvederm sales: $231MJuvederm growth: -20% operational
    		$1.1B-10.2% operational——
    Neuroscience
    All key products exceeded expectations, strong share capture for Vraylar, double-digit growth for migraine portfolio, strong uptake for Vyalev.
    Vraylar global sales: $765MVraylar growth: +10.3%Botox Therapeutic global revenues: $866MBotox Therapeutic growth: +17%Ubrelvy global sales: $240MUbrelvy growth: +18%Qulipta global revenues: $193MQulipta growth: +48.3%Vyalev global sales: $63M
    		$2.3B+17% operational——

    Operational metrics

    17
    Adjusted earnings per share
    $2.46+$0.10 vs guidance midpoint
    Q1 FY25

    Includes a $0.13 unfavorable impact from acquired IPR&D expense.

    Total net revenues
    $13.3B+$550M vs expectations
    Q1 FY25

    null

    Ex-Humira platform sales growth
    >21%
    Q1 FY25

    null

    Total net revenues operational growth
    9.8%
    Q1 FY25

    Excluding a 1.4% unfavorable impact from foreign exchange.

    FX impact on total net revenues
    -1.4%unfavorable
    Q1 FY25

    null

    Adjusted gross margin
    84.1%
    Q1 FY25

    null

    Adjusted R&D expense
    15.4%
    Q1 FY25

    null

    Adjusted SG&A expense
    24.6%
    Q1 FY25

    null

    Adjusted operating margin ratio
    42.3%
    Q1 FY25

    Includes a 1.9% unfavorable impact from acquired IPR&D expense.

    Net interest expense
    $627M
    Q1 FY25

    null

    Adjusted tax rate
    14.2%
    Q1 FY25

    null

    Estimated FX impact on full-year sales growth
    -0.6%unfavorable
    FY25

    null

    Estimated FX impact on Q2 sales growth
    -0.3%unfavorable
    Q2 FY25

    null

    ABBV-295 mean weight loss
    7.8%vs 2% weight gain in placebo
    6 weeks

    Interim results from Phase I multiple ascending dose study for long-acting amylin analog.

    ABBV-295 half-life
    270
    null

    Could allow for twice a month or monthly dosing.

    Aesthetics tariff impact (existing rules)
    $30M
    FY25

    Modest impact from current tariff rules, absorbed in guidance.

    U.S. manufacturing investment
    $10B
    next decade

    Planned capital investment to support volume growth and expansion into new areas like obesity.

    Industry KPIs

    8
    MetricValueDetails
    Launch access metricsearly launch feedback positive
    Pipeline read out calendarSeveral important data readouts
    Product franchise net sales$5.1BUSD
    Regulatory approvals filingsEuropean approval for Rinvoq in GCA; FDA approval expected soon
    Peak long term sales guidancehigh single-digit% CAGR
    Therapeutic drug market sharemid-teens%
    Prescription volume new starts1 out of every 2
    Clinical trial efficacy safety data7.8% mean weight loss%

    Product announcements

    3
    ProductTypeDetails
    BoNT/Emilestone
    Teliso-Vmilestone
    Tavapadonmilestone

    Deals & partnerships

    2
    Nimble TherapeuticsAcquisition to expand immunology portfolio with oral peptides.

    This includes the recent acquisition of Nimble Therapeutics to expand our immunology portfolio with oral peptides.

    GubraLicense agreement to develop an amylin analog for the treatment of obesity.

    as well as the license agreement with Gubra to develop an amylin analog for the treatment of obesity.

    Risks & headwinds

    5
    Faster Humira erosionQ1 FY25, continuing into FY25

    Global sales down 49.5% operationally to $1.1B, leading to a $500M decrease in FY25 U.S. Humira revenue guidance.

    Mitigation: Focus on ex-Humira growth platform, monitoring 2026 access.

    Economic headwinds impacting aesthetics marketQ1 FY25, continuing through FY25

    Global sales down 10.2% operationally to $1.1B, leading to a $100M decrease each for Botox and Juvederm FY25 sales guidance.

    Mitigation: Moderating assumptions for category growth, long-term prospects remain attractive, new product (BoNT/E) to activate new patients.

    Potential sectoral tariffsFY25 (partial year impact if enacted)

    Not quantified, but management stated it would be 'in line with our peers' and current guidance does not contemplate impact. Modest impact of ~$30M from existing tariffs on aesthetics absorbed in guidance.

    Mitigation: Inventory management, alternate API sources, cost efficiencies, productivity initiatives, long-term U.S. manufacturing expansion ($10B+ investment).

    Competitive dynamics in CLL impacting ImbruvicaQ1 FY25

    Global sales down 11.9% to $738M.

    Mitigation: Focus on Venclexta's strong performance and emerging solid tumor portfolio.

    Drug pricing reform / international reference pricingOngoing policy discussions.

    Not quantified.

    Mitigation: Advocating for balanced approach that encourages innovation, supporting policies that properly value innovation, engaging with lawmakers on tax reform and patient affordability.

    What to watch in Q2 FY25

    5

    Teliso-V regulatory approval and commercialization

    Q2 FY25 (next couple of months)
    CurrentPending accelerated approval
    TargetApproval and commercial launch

    Why it matters

    Teliso-V is a potential new medicine for late-line NSCLC patients, representing an emerging commercial portfolio in solid tumors.

    We anticipate accelerated approval in the second quarter for Teliso-V as a monotherapy in previously treated non-squamous non-small cell lung cancer with high c-Met expression... U.S. regulatory approval and commercialization expected in the next couple of months.

    Q&A highlights

    5

    What indications are driving Skyrizi/Rinvoq upside, competitive landscape (TREMFYA in IBD), and Humira tail expectations given faster erosion?

    Skyrizi upside is split between psoriatic ($200M) and IBD ($400M) indications. Rinvoq upside ($300M) is across rheumatology, derm, and IBD. Management is confident in IBD performance despite competition, citing the overall growth of the IL-23 class. Humira erosion is faster than expected, but the real impact of the tail is when it no longer presents a meaningful headwind, which is expected to develop around the 2026 time period.

    “the real impact of the tail is when Humira does not have a meaningful headwind to our overall growth as a corporation. So we expect that to start to develop over that '26 time period.”

    asked by Chris Schott · answered by Jeffrey Stewart

    2 min read6 chapters

    Detailed Narrative

    01

    Immunology Portfolio Strength

    Skyrizi and Rinvoq continue to drive significant growth, with combined sales exceeding $5.1 billion, up over 65%. They are capturing substantial share in IBD, particularly in Crohn's disease (roughly 1 in 2 in-play patients in the U.S.) and ulcerative colitis (1 in 3 in-play patients for Skyrizi). Strong momentum is also noted across indications in dermatology and rheumatology, leading to raised full-year sales guidance for both products.

    02

    Oncology Pipeline Advancement

    AbbVie is making progress with its oncology pipeline, including Teliso-V for non-small cell lung cancer with expected regulatory approval and commercialization in the next couple of months. Next-generation ADCs like TMAb A and ABBV-706 are advancing, with TMAb A Phase I results to be presented at ASCO and ABBV-706 showing 60% objective response rate in relapsed/refractory SCLC. The Phase III Venclexta MDS trial data readout remains on track for this year.

    03

    Neuroscience Franchise Growth

    The neuroscience portfolio delivered strong operational growth of 17%, with Vraylar, Botox Therapeutic, Ubrelvy, and Qulipta all exceeding expectations. Vraylar gained share in bipolar I and major depression, while the migraine portfolio showed double-digit growth. Vyalev is seeing strong uptake in Japan and Europe, with early positive feedback in the U.S. as Medicare coverage is established. Tavapadon, for Parkinson's disease, is expected to be submitted for regulatory review later this year.

    04

    Obesity Strategy and Amylin Analog

    AbbVie is expanding into the obesity market, acquiring Nimble Therapeutics to broaden its immunology portfolio and licensing an amylin analog (ABBV-295) from Gubra. Early Phase I data for ABBV-295 showed dose-dependent mean weight loss of 7.8% at 2mg, with a favorable tolerability profile. The company plans further investment in obesity, aiming for a differentiated asset with potential for monotherapy or combination use, with full Phase I data expected next year.

    05

    Tariff and Manufacturing Footprint

    Management addressed potential sectoral tariffs, stating current guidance does not contemplate their impact. AbbVie highlighted its extensive U.S. manufacturing network across 11 sites, with plans to invest over $10 billion in capital in the U.S. over the next decade to support volume growth and expansion into new areas like obesity. The company believes a more competitive tax policy, building on 2017 tax reform, will encourage sustainable U.S. manufacturing.

    06

    Aesthetics Market Headwinds

    Global aesthetics sales declined 10.2% operationally, in line with expectations, due to continued economic headwinds and moderated assumptions for category growth. Despite near-term challenges, the long-term prospects remain attractive given high consumer interest and low penetration rates. The company is preparing for the commercialization of BoNT/E, a fast-acting toxin, next year, which has the potential to be an important catalyst for new patient activation.

    AI-generated summary of the company’s earnings call. Not investment advice.