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    GILD
    Earnings call· Jun 2025(Q2 FY25)

    GILEAD SCIENCES Q2 FY25 earnings call GILD

    Aug 7, 2025 Source

    Executive summary

    Gilead Sciences Q2 FY25 — Strong Performance Driven by HIV Portfolio and Yeztugo Launch, Full-Year Guidance Raised

    Gilead delivered a very strong second quarter, exceeding expectations with robust growth in its HIV portfolio, particularly Biktarvy and Descovy, and the successful early launch of Yeztugo for HIV prevention. Despite headwinds from lower Veklury sales and Medicare Part D redesign, the company raised its full-year revenue and EPS guidance. The quarter also saw significant clinical progress, including positive Phase III results for Trodelvy and advancements in the cell therapy pipeline, underscoring strong R&D and commercial execution.

    Highlights

    5

    • Excluding Veklury, base business sales of $6.9 billion grew 4% year-over-year.

    • HIV sales grew 7% year-over-year to $5.1 billion, driven by demand and higher realized price.

    • Biktarvy sales grew 9% year-over-year to $3.5 billion, expanding U.S. market share to over 51%.

    • Descovy sales increased 35% year-over-year to $653 million, with U.S. PrEP market expanding to over 0.5 million active users.

    • FDA approval and successful early launch of Yeztugo for twice-yearly HIV prevention, with first prescription within hours of approval.

    Concerns

    5

    • Veklury sales declined 44% year-over-year to $121 million due to fewer COVID-19 hospitalizations.

    • HCV sales were down 4% year-over-year, impacted by lower average realized price and patient starts.

    • Cell therapy sales were down 7% year-over-year to $485 million, facing competitive headwinds.

    • Medicare Part D redesign expected to impact HIV business by approximately $900 million in FY25.

    • WONDERS program (weekly HIV treatment) on clinical hold pending further analysis.

    Guidance & targets

    17
    CategoryTargetConfidence
    Full-year 2025 Product Sales (excluding Veklury)
    $27.3 billion to $27.7 billion
    high materiality
    High
    Full-year 2025 HIV Sales Growth
    approximately 3% year-over-year
    high materiality
    High
    Full-year 2025 Veklury Sales
    approximately $1 billion
    medium materiality
    High
    Full-year 2025 Total Product Sales
    $28.3 billion to $28.7 billion
    high materiality
    High
    Full-year 2025 Product Gross Margin (non-GAAP)
    approximately 86%
    medium materiality
    High
    Full-year 2025 R&D Expenses
    roughly flat on a dollar basis from 2024
    medium materiality
    High
    Full-year 2025 Acquired IPR&D Expenses
    approximately $400 million
    medium materiality
    High
    Full-year 2025 SG&A Expenses
    decline by a mid- to high single-digit percentage compared to 2024
    medium materiality
    High
    Full-year 2025 Operating Income
    between $13 billion and $13.4 billion
    high materiality
    High
    Full-year 2025 Effective Tax Rate
    approximately 19%
    low materiality
    High
    Full-year 2025 Diluted EPS
    between $7.95 and $8.25
    high materiality
    High
    Yeztugo Access Target
    75% access within 6 months of launch and 90% within 12 months
    high materiality
    High
    European Commission Decision on lenacapavir
    decision expected
    medium materiality
    High
    PURPOSE-365 (once yearly lenacapavir for PrEP) Launch
    as early as 2028
    medium materiality
    Medium
    ISLEND (islatravir and lenacapavir) Launch
    2027
    medium materiality
    Medium
    Lenacapavir plus bNAbs Launch
    2030
    medium materiality
    Medium
    Anito-cel Commercial Launch
    2026
    high materiality
    High

    Segment performance

    5
    SegmentRevenueYoYQoQMargin
    HIV
    Strong demand-driven growth, partially offsetting Medicare Part D redesign impact. Biktarvy expanded U.S. market share. Descovy had its strongest quarter ever, driven by PrEP market expansion.
    Biktarvy sales: $3.5 billionBiktarvy growth YoY: 9%Biktarvy market share (U.S.): over 51%Descovy sales: $653 millionDescovy growth YoY: 35%Descovy PrEP market share (U.S.): more than 40%U.S. PrEP market active users: more than 0.5 millionU.S. PrEP market growth YoY: mid-teens
    		$5.1 billion7%11%—
    Liver Disease
    Sales down following strong Q2 2024, impacted by lower HCV pricing and patient starts. Livdelzi showed strong performance and early launch success in Europe.
    Livdelzi sales: $78 millionLivdelzi sales QoQ: almost doubled (from $40 million in Q1)Livdelzi market share: growing second-line PBC
    		$795 million-4%——
    Oncology (Trodelvy)
    Continued strength in metastatic breast cancer, offsetting bladder cancer indication withdrawal. Strong international demand and share gains.
    		$364 million14%24%—
    Cell Therapy
    Faced competitive headwinds, but sequential growth helped by FX and higher demand for Yescarta (U.S.) and Tecartus (globally). FDA changes to REMS program and patient restrictions expected to aid adoption.
    		$485 million-7%5%—
    Veklury
    Sales declined due to fewer COVID-19 hospitalizations.
    U.S. hospitalized patients treated for COVID-19 share: well over 60%
    		$121 million-44%——

    Operational metrics

    19
    Product gross margin (non-GAAP)
    87%up 1% YoY
    Q2 FY25
    R&D expenses
    —up 9% YoY
    Q2 FY25

    compared to a relatively low Q2 2024, reflecting investments in clinical manufacturing and study activities

    Acquired IPR&D expenses
    $61 million
    Q2 FY25
    SG&A expenses
    —flat YoY
    Q2 FY25

    higher sales and marketing expenses (HIV) offset by lower G&A expenses

    Operating margin (non-GAAP)
    46%
    Q2 FY25
    Operating margin (non-GAAP, excluding acquired IPR&D)
    47%
    Q2 FY25
    Effective tax rate (non-GAAP)
    19%
    Q2 FY25
    Share repurchases
    $527 million
    Q2 FY25

    currently being executed under the 2020 plan

    Capital returned to shareholders
    $1.5 billion
    Q2 FY25
    Share repurchase authorization (new)
    $6 billion
    approved recently

    intended to offset equity dilution at a minimum, can be used opportunistically

    Base business sales (ex-Veklury)
    $6.9 billionup 4% YoY
    Q2 FY25
    Total product sales
    $7.1 billionup 2% YoY
    Q2 FY25
    HIV growth (ex-Medicare Part D impact)
    more than 7%
    FY25

    excluding the anticipated $900 million impact from Medicare Part D redesign

    Yeztugo unaided awareness (HCPs)
    72%
    pre-launch

    more than twice the typical pre-launch awareness

    Yeztugo aided awareness (HCPs)
    95%
    pre-launch
    Yeztugo J-code availability
    October 1
    2025

    ahead of expectations, simplifies billing and reimbursement process

    CAR T REMS program requirement
    removed
    recent

    reduces burden of CAR T administration for healthcare providers, patients and caregivers

    CAR T patient proximity restriction
    50% reduction
    recent

    reduces the time patients need to remain near their treating center

    CAR T driving restrictions
    75% reduction
    recent

    improves patient and caregiver quality of life

    Industry KPIs

    3
    MetricValueDetails
    Launch access metrics75%%
    Therapeutic drug market shareover 51%%
    Clinical trial efficacy safety data11.2 monthsmonths

    Product announcements

    4
    ProductTypeDetails
    lenacapavir (Yeztugo)launch
    lenacapavirmilestone
    Biktarvyexpansion
    CAR T product labelsupdate

    Deals & partnerships

    2
    Kymeracollaboration

    Acquired IPR&D expenses of $61 million in Q2 2025 were primarily driven by the Kymera collaboration announced in June.

    The Global Fundpartnership to bring lenacapavir to low and lower middle-income countriesover the next 3 years

    Announced a partnership with the Global Fund to bring lenacapavir to approximately 2 million people in primarily low and lower middle-income countries over the next 3 years.

    Risks & headwinds

    5
    Medicare Part D redesign impact on HIV businessFY25

    approximately $900 million in 2025

    Mitigation: Strong Biktarvy and Descovy performance, increased demand, higher average realized price.

    Lower Veklury sales due to reduced COVID-19 hospitalizationsQ2 FY25 and full year 2025

    $121 million in Q2 FY25 (down 44% YoY)

    Mitigation: Adjusted full-year Veklury sales expectations to $1 billion.

    Competitive headwinds in Cell TherapyQ2 FY25

    sales down 7% YoY to $485 million

    Mitigation: FDA changes to REMS program and patient restrictions, focus on outpatient delivery, new real-world data for Yescarta, continued development of next-gen CAR Ts.

    Clinical hold on WONDERS weekly HIV treatment programongoing

    delay of 3 to 6 quarters for wholly owned once-weekly program

    Mitigation: Further analysis of data, plans to move forward with other molecules in the portfolio, strong overall HIV pipeline (daily, monthly, quarterly, other weekly programs like ISLEND).

    Potential MFN proposal impact on Medicaidpotential late '26 into '27 for current legislation

    Medicaid business for HIV is mid-to-lower 20s of total HIV sales

    Mitigation: Ongoing discussions with administration, strong safety net programs for HIV patients, focus on preserving ecosystem for innovation.

    What to watch in Q3 FY25

    5

    Yeztugo access expansion

    next quarter or two
    CurrentEarly wins in CA/FL Medicaid, J-code Oct 1
    TargetSignificant increase in covered lives

    Why it matters

    Critical for accelerating Yeztugo's commercial momentum and achieving access targets.

    But I think more importantly, we really need to see the number of covered lives increase over the next quarter or two to really see that momentum and really pull through those intake calls into scripts and injections.

    Q&A highlights

    7

    How is Yeztugo uptake progressing, and will it be linear or exponential?

    Johanna Mercier expressed satisfaction with the early launch, highlighting high pre-launch awareness (72% unaided), rapid first prescription/injection, and proactive engagement with payers. She noted early wins with J-code confirmation for Oct 1 and formulary access in key states (CA, FL Medicaid). She expects more clarity on the launch curve in future quarters as access expands.

    “We've already had over about 25,000 customer calls executed in the field and just understanding that our target base is about 15,000. So many of those customers have seen either a representative or a medical sales representative more than once.”

    asked by Tyler Van Buren · answered by Johanna Mercier

    2 min read6 chapters

    Detailed Narrative

    01

    Yeztugo Launch and HIV Prevention

    Gilead achieved FDA approval for lenacapavir (Yeztugo) for twice-yearly HIV prevention in mid-June, marking a significant milestone. The launch has seen strong early execution, with the first prescription written within hours and the first dose administered within days. Unaided awareness among healthcare providers was 72% pre-launch, significantly higher than typical. The company aims for 75% access within 6 months and 90% within 12 months, supported by early J-code confirmation for October 1 and formulary wins in key states like California and Florida.

    02

    HIV Treatment Portfolio Strength

    The HIV segment delivered robust 7% year-over-year growth, reaching $5.1 billion in sales, despite an anticipated $900 million impact from Medicare Part D redesign. Biktarvy sales grew 9% to $3.5 billion, expanding its U.S. market share to over 51%. Descovy sales surged 35% to $653 million, benefiting from increased awareness and unrestricted access in the growing PrEP market, which now exceeds 0.5 million active users.

    03

    Oncology Pipeline Advancements

    Gilead announced positive Phase III results for Trodelvy from ASCENT-03 and ASCENT-04 studies in first-line metastatic triple-negative breast cancer (TNBC). Detailed data from ASCENT-04 showed an 11.2 months median progression-free survival with Trodelvy plus pembrolizumab, a 35% improvement. These results support a planned filing for full approval in the first-line setting, with a potential FDA decision in 2026, aiming to expand Trodelvy's reach to a patient population almost twice the size of the second-line setting.

    04

    Cell Therapy Progress and Challenges

    Cell therapy sales were down 7% year-over-year to $485 million, facing competitive headwinds. However, sales were up 5% sequentially, and the company is making progress in reducing adoption barriers. Recent FDA changes removed the CAR T REMS program requirement and reduced patient proximity and driving restrictions, which are expected to improve patient quality of life and broader adoption. New real-world data at ASCO also supported the viability of outpatient administration for Yescarta.

    05

    Clinical Pipeline Depth

    Beyond Yeztugo, Gilead's clinical pipeline remains active. In HIV, new Phase III trials include PURPOSE-365 (once-yearly lenacapavir for PrEP) and ARTISTRY-1 and ARTISTRY-2 (bictegravir/lenacapavir combination for treatment). The company also has multiple next-generation CAR T constructs in development, with pivotal data for anito-cel in multiple myeloma expected later this year, targeting a 2026 launch.

    06

    Financial Performance and Outlook

    The strong first-half performance led to an increase in full-year 2025 guidance for product sales (excluding Veklury) to $27.3 billion-$27.7 billion and diluted EPS to $7.95-$8.25. This reflects robust HIV growth and encouraging momentum in Livdelzi and Trodelvy, partially offset by a reduction in Veklury sales expectations due to lower COVID-19 hospitalizations and softer cell therapy expectations.

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