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    GILD
    Earnings call· Jun 2026(Q2 FY26)

    GILEAD SCIENCES Q2 FY26 earnings call GILD

    Aug 4, 2026 Source

    Executive summary

    Gilead Q2 FY26 — Strong Commercial Execution and Pipeline Advancement

    Gilead delivered a strong second quarter, marked by robust commercial execution across its core therapeutic areas, particularly in HIV and oncology. The company raised its full-year HIV growth expectations and advanced its extensive pipeline through strategic acquisitions and positive clinical readouts. Management remains focused on integrating new programs and preparing for several key product launches in the near term, while continuing to diversify its portfolio.

    Highlights

    5

    • Base business sales increased 10% year-over-year to $7.6 billion, driven by HIV, Trodelvy, and Livdelzi.

    • HIV sales grew 12% year-over-year to $5.7 billion, with Biktarvy sales up 7% to $3.8 billion.

    • PrEP business sales doubled year-over-year, exceeding $1 billion quarterly for the first time, with an annual run rate of $4 billion.

    • Trodelvy sales were up 26% year-over-year to $457 million, driven by strong demand and new first-line approvals.

    • Livdelzi sales more than doubled year-over-year to $167 million, establishing it as the leading second-line PBC regimen.

    Concerns

    3

    • Cell therapy sales were down 14% year-over-year to $417 million due to ongoing in and out-of-class competition.

    • Veklury sales are now expected to be approximately $300 million for FY26, down from $600 million previously, reflecting lower COVID-19 hospitalizations.

    • HIV treatment market growth slowed in Q2 due to changes in the Affordable Care Act, impacting patient insurance coverage.

    Guidance & targets

    13
    CategoryTargetConfidence
    Full-year HIV sales growth
    9% to 10% year-over-year
    high materiality
    High
    Full-year Yeztugo sales
    approximately $1 billion
    medium materiality
    High
    Full-year base business sales
    $29.8 billion to $30.1 billion
    high materiality
    High
    Full-year total product sales
    $30.1 billion to $30.4 billion
    high materiality
    High
    Full-year Veklury sales
    approximately $300 million
    medium materiality
    High
    Full-year acquired IPR&D expenses
    $11.5 billion
    high materiality
    High
    Full-year R&D expenses
    increase mid-single-digit percentage on a dollar basis
    medium materiality
    High
    Full-year SG&A expenses
    increase mid-single-digit percentage on a dollar basis
    medium materiality
    High
    Full-year non-GAAP effective tax rate
    140% and 115%
    medium materiality
    High
    Full-year non-GAAP effective tax rate (excluding acquisitions)
    20%
    medium materiality
    High
    Full-year non-GAAP EPS
    negative $0.65 to negative $0.30
    high materiality
    High
    Full-year non-GAAP diluted EPS (illustrative, excluding acquisitions and nonrecurring revenue)
    $8.50 to $8.85
    high materiality
    High
    Cell therapy sales decline
    mid-teens percentage year-over-year
    medium materiality
    High

    Segment performance

    4
    SegmentRevenueYoYQoQMargin
    HIV
    Strong performance driven by Biktarvy in treatment and Descovy/Yeztugo in PrEP, with higher average realized price and demand. Sequential growth also driven by inventory build and typical seasonality.
    Biktarvy sales: $3.8BBiktarvy growth YoY: 7%Biktarvy growth QoQ: 12%PrEP sales: >$1BPrEP growth YoY: >100%Yeztugo sales: $232MYeztugo growth QoQ: 40%Descovy PrEP sales: ~$801MDescovy PrEP growth YoY: 60%
    		$5.7B12%13%—
    Oncology
    Exceptional growth for Trodelvy driven by strong demand across triple-negative and pretreated HR-positive/HER2-negative metastatic breast cancer, and new first-line approvals.
    Trodelvy sales: $457MTrodelvy growth YoY: 26%Trodelvy growth QoQ: 13%
    		————
    Cell Therapy
    Sales decline year-over-year due to expected ongoing in and out-of-class competition. Sequential growth driven by increased Yescarta demand, partially offset by competitive pressures for Tecartus.
    		$417M-14%2%—
    Liver Disease
    Overall growth reflects increased demand across PBC, HBV, and HDV, partially offset by lower HCV starts. Livdelzi continues to gain momentum as the leading second-line PBC regimen.
    Livdelzi sales: $167MLivdelzi growth YoY: >100%Livdelzi growth QoQ: 26%
    		$877M10%14%—

    Operational metrics

    20
    Total product sales (excluding Veklury)
    $7.6Bup 10% YoY
    Q2 FY26

    Driven by strong growth in Biktarvy, Descovy, Yeztugo, Trodelvy, and Livdelzi.

    Total product sales (including Veklury)
    $7.6Bup 8% YoY
    Q2 FY26

    Reflects 10% growth in base business, partially offset by lower Veklury sales.

    Other revenue
    $176M
    Q2 FY26

    Nonrecurring and noncash item reflecting an accounting change.

    Product gross margin
    87%flat YoY
    Q2 FY26

    In line with full-year guidance.

    R&D expenses
    $1.4Brelatively flat YoY
    Q2 FY26

    Reflects strategic shifts in R&D focus and integration of new acquisitions.

    Acquired IPR&D expenses
    $11.2B
    Q2 FY26

    Significant expense related to recent strategic acquisitions.

    SG&A expenses
    $1.5Bup 12% YoY
    Q2 FY26

    Increased due to launch support for key products.

    Operating margin
    -94%
    Q2 FY26

    Reflecting acquisitions of Arcellx, Tubulis, and Ouro Medicines.

    Operating margin (excluding acquired IPR&D)
    49%
    Q2 FY26

    Consistent with prior quarters and in the top quartile of peer group, underscoring disciplined operating model.

    Non-GAAP effective tax rate
    -11.4%
    Q2 FY26

    Primarily driven by the acquisitions of Arcellx, Tubulis, and Ouro Medicines.

    Non-GAAP effective tax rate (excluding acquisitions)
    19%
    Q2 FY26

    Consistent with prior guidance when excluding acquisition impacts.

    Non-GAAP diluted EPS
    -$6.75
    Q2 FY26

    Reflected higher acquired IPR&D, tax, and SG&A expenses, partially offset by higher revenue.

    Non-GAAP diluted EPS (illustrative, excluding acquisitions and nonrecurring revenue)
    $2.27up ~13% YoY (illustrative)
    Q2 FY26

    Illustrative EPS growth compared to the same period last year, highlighting business model leverage.

    Share repurchases
    $355M
    Q2 FY26

    Part of capital returned to shareholders.

    Capital returned to shareholders
    $1.4B
    Q2 FY26

    Represents approximately 49% of free cash flow returned in H1 FY26.

    HIV treatment market growth
    slowing
    Q2 FY26

    Due to market dynamics, including greater-than-expected impact from changes in the Affordable Care Act. Expected to trend back to typical 2% to 3% annual growth rate.

    U.S. PrEP market growth
    14%
    YoY

    Marking another quarter of double-digit percentage growth on an increasingly larger base of users.

    Yeztugo persistency rate
    >70%
    6 months

    High level of persistency, believed to be well above available PrEP options.

    Yescarta manufacturing success rate
    98%
    Q2 FY26

    Reinforcing Kite's operational and technical leadership.

    Yescarta global median turnaround time
    18 days
    Q2 FY26

    Confidence in meeting needs of multiple myeloma patients awaiting anito-cel launch.

    Industry KPIs

    10
    MetricValueDetails
    Launch access metricsExtensive launch readiness activities
    Pipeline read out calendarMultiple readouts and initiations
    Product franchise net salesBiktarvy: $3.8B; Yeztugo: $232M; Descovy (PrEP): ~$801M; Trodelvy: $457M; Livdelzi: $167MUSD
    Regulatory approvals filingsMultiple approvals and filings
    Peak long term sales guidanceApproximately $1 billionUSD
    Therapeutic drug market shareIncreased share
    Prescription volume new startsU.S. PrEP market grew approximately 14% YoY%
    Clinical trial efficacy safety dataPositive data
    Collaboration milestone royalty revenue$156MUSD
    Cumulative patients uptake since launch>70%%

    Product announcements

    2
    ProductTypeDetails
    Hepcludexlaunch
    Trodelvyexpansion

    Deals & partnerships

    5
    TubulisAcquisition of an industry-leading ADC platform and promising clinical stage ADCs.

    Provides novel linker and payload technologies, complementing Gilead's ADC leadership. Closed this quarter.

    ArcellxAcquisition to gain full ownership of anito-cel and the D-Domain binder platform.

    Enables faster, more focused execution in multiple myeloma and future opportunities in CAR T. Closed in April.

    Ouro MedicinesAcquisition adding bispecific T-cell engager assets.

    Expands the breadth of Gilead's innovation engine. Closed this quarter.

    MerckCollaboration on once-weekly oral HIV treatment regimen (islatravir + lenacapavir).

    Shared positive Phase III data for ISL/LEN at IAS. Working towards global regulatory filings and potential launch in 2027.

    PregeneCollaboration to accelerate in vivo CAR T platform development.

    Enables speed to clinic for updated in vivo platform, with two investigator-sponsored studies starting later this year.

    Risks & headwinds

    3
    Competition in cell therapyQ2 FY26 and ongoing

    Cell therapy sales down 14% YoY

    Mitigation: Launch readiness activities for anito-cel, focus on differentiated profile, expanding D-Domain binder platform for future CAR T opportunities.

    Decline in Veklury salesFY26

    Full-year Veklury sales guidance reduced from $600M to $300M

    Mitigation: Focus on growth in base business and new product launches to offset decline.

    Impact of Affordable Care Act (ACA) changes on HIV treatment marketQ2 FY26, expected to normalize

    Slowing in HIV treatment market growth in Q2

    Mitigation: Monitoring patient navigation of insurance changes; expect trend back to typical 2-3% annual growth rate.

    What to watch in Q3 FY26

    5

    BIC/LEN FDA decision

    Q3 FY26
    CurrentExpected later this month (August)
    TargetApproval decision

    Why it matters

    This is a key regulatory catalyst for a new daily oral HIV treatment option, crucial for expanding Gilead's leadership in the switch market.

    Later this month, we expect an FDA decision on our once-daily oral treatment combining bictegravir and lenacapavir.

    Q&A highlights

    6

    Can you explain the growing delta between Yeztugo prescription trends (IQVIA) and reported sales, and what are the biggest growth drivers for Yeztugo through year-end?

    Gilead will not comment on IQVIA data but is confident in its own reported data. Key growth drivers for Yeztugo include strong uptake in naive and switch markets, growing HCP confidence, the expanding PrEP market (14% YoY growth), and a high persistency rate of over 70% at 6 months. The company remains confident in its $1 billion full-year sales guidance for Yeztugo.

    “For Yeztugo, as you think about the back half of this year, really building on a really strong first half. And I would say that we expect strong continued launch momentum because we're still in launch mode. And that's really driven by the strong uptake we've been seeing in both naive and switch market, the growing confidence that we're seeing with our health care professionals with access pathways, logistics, experience with Yeztugo.”

    asked by Tyler Van Buren · answered by Johanna Mercier

    2 min read6 chapters

    Detailed Narrative

    01

    HIV Portfolio Strength and Pipeline Expansion

    Gilead's HIV business demonstrated significant strength, with overall sales up 12% year-over-year. Biktarvy continued its leadership in treatment, while the PrEP business, driven by Descovy and Yeztugo, doubled year-over-year to exceed $1 billion in quarterly sales. The company is expanding its HIV pipeline with potential new daily, weekly, monthly, twice-yearly, and yearly options, including an anticipated FDA decision for BIC/LEN and planned launch of ISL/LEN in 2027.

    02

    Oncology Growth and ADC Platform Advancement

    Trodelvy sales grew 26% year-over-year, benefiting from strong demand in metastatic breast cancer and recent FDA approvals for first-line metastatic triple-negative breast cancer. The acquisition of Tubulis closed, providing an industry-leading ADC platform and promising clinical-stage ADCs like GS-8824 (formerly TUB-040) which showed encouraging Phase I data in platinum-resistant ovarian cancer. Gilead aims to be a leader in ADC innovation long-term.

    03

    Cell Therapy Progress and Anito-cel Launch Readiness

    Despite a 14% year-over-year decline in cell therapy sales due to competition, Gilead is actively preparing for the potential launch of anito-cel for multiple myeloma, with a PDUFA date in December. The acquisition of Arcellx gives full ownership of anito-cel and the D-Domain binder platform, enabling faster execution and future opportunities in CAR T. Enrollment for iMMagine-3 in second-line multiple myeloma was completed, with potential filing as early as 2027.

    04

    Liver Disease Momentum and New Approvals

    The liver disease business saw strong performance, with Livdelzi sales more than doubling year-over-year and gaining momentum as the leading second-line treatment for primary biliary cholangitis (PBC). Positive Phase III IDEAL data further strengthens Livdelzi's opportunity. Hepcludex was also launched in the U.S. as the first and only FDA-approved treatment for chronic hepatitis delta virus (HDV), addressing a small but underserved patient population.

    05

    Strategic Acquisitions and Pipeline Diversification

    Gilead completed acquisitions of Arcellx, Tubulis, and Ouro Medicines, significantly expanding its pipeline in cell therapy, antibody-drug conjugates, and bispecific T-cell engagers. These acquisitions complement the company's existing pipeline and support its long-term strategy to diversify beyond virology into oncology and inflammation. The company does not anticipate additional sizable M&A this year but remains opportunistic.

    06

    Financial Performance and Capital Allocation

    The company reported strong base business growth and raised its full-year sales and illustrative EPS guidance. Non-GAAP diluted EPS, excluding acquired IPR&D and nonrecurring revenue, grew approximately 13% year-over-year. Gilead returned nearly $1.4 billion to shareholders in Q2, including $355 million in share repurchases, representing approximately 49% of free cash flow returned in the first half of 2026.

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