Merck & Co., Inc. (NYSE:MRK) Releases Quarterly Earnings Results, Beats Expectations By $0.03 EPS

Key Points

• Merck beat Q1 expectations with $16.3 billion in revenue (up ~5%) and reported ($1.28) EPS (beat by $0.03), while narrowing and raising its FY‑2026 non‑GAAP guidance to $65.8–$67.0 billion revenue and $5.04–$5.16 EPS.
• A large one‑time acquisition‑related charge (~$9 billion) and related tax effects drove a GAAP pre‑tax loss this quarter, and the proposed Terns deal would add ~$5.8 billion one‑time R&D cost (~$2.35/share) and roughly a ‑$0.12 EPS drag near term.
• Commercial and pipeline momentum remains strong: Keytruda sales rose to $8.0 billion (+8%) with early sales of KEYTRUDA QLEX at $128 million, alongside regulatory wins and reviews including FDA approval of Edvinso and upcoming PDUFA dates for multiple oncology candidates.

Merck & Co., Inc. (NYSE:MRK - Get Free Report) announced its quarterly earnings data on Thursday. The company reported ($1.28) earnings per share for the quarter, topping the consensus estimate of ($1.31) by $0.03, FiscalAI reports. Merck & Co., Inc. had a return on equity of 44.57% and a net margin of 28.08%.The company had revenue of $16.29 billion for the quarter, compared to analyst estimates of $15.91 billion. During the same quarter last year, the firm earned $2.22 EPS. Merck & Co., Inc.'s revenue for the quarter was up 4.9% compared to the same quarter last year. Merck & Co., Inc. updated its FY 2026 guidance to 5.040-5.160 EPS.

Here are the key takeaways from Merck & Co., Inc.'s conference call:

• Merck reported Q1 revenue of $16.3 billion (up 5%) and has narrowed and raised its 2026 non‑GAAP guidance to $65.8–$67.0 billion revenue and $5.04–$5.16 EPS, citing continued oncology, Animal Health, and new‑product momentum.
• A $9 billion one‑time acquisition‑related charge for Sedera drove a GAAP pre‑tax loss and produced a reported loss of $1.28/share this quarter, including a $3.62/share hit from the charge and an unusual tax rate impact (‑43.5%).
• Meaningful pipeline and regulatory progress — FDA approval of the once‑daily two‑drug HIV regimen Edvinso (doravirine+islatravir), priority review for Ifinatamab deruxtecan in extensive‑stage SCLC (PDUFA Oct 10), and upcoming PDUFA dates for Keytruda+Padcev and WELIREG combinations.
• Commercial strength and new launches: Keytruda family sales rose to $8.0 billion (+8%) with KEYTRUDA QLEX early sales of $128 million and permanent J‑code, while Animal Health delivered mid‑single‑digit growth and new product launches (e.g., Numelvy) support long‑term growth.
• Proposed acquisition of Terns (TERN‑701) targets a high‑value hematology opportunity with multibillion upside but will create a near‑term headwind — ~$5.8 billion one‑time R&D charge (~$2.35/share) and ~‑$0.12 EPS drag this year — management frames it as science‑led BD to strengthen the pipeline.

Merck & Co., Inc. Price Performance

Shares of Merck & Co., Inc. stock traded down $1.62 during midday trading on Thursday, hitting $109.33. 17,085,152 shares of the company were exchanged, compared to its average volume of 8,626,114. The company has a debt-to-equity ratio of 0.89, a current ratio of 1.54 and a quick ratio of 1.30. The firm has a market cap of $270.03 billion, a P/E ratio of 15.02, a PEG ratio of 2.25 and a beta of 0.26. Merck & Co., Inc. has a 52 week low of $73.31 and a 52 week high of $125.14. The firm has a 50 day simple moving average of $117.69 and a 200-day simple moving average of $107.39.

Key Stories Impacting Merck & Co., Inc.

Here are the key news stories impacting Merck & Co., Inc. this week:

• Positive Sentiment: Q1 results and product momentum: Merck beat Q1 revenue and adjusted EPS expectations, driven by continued Keytruda demand and contributions from newer launches (Winrevair reported at ~$525M), which underpin near‑term revenue growth. Merck Sales Beat As Winrevair Hits $525 Million
• Positive Sentiment: Management raised adjusted EPS guidance and emphasized oncology strength: Merck narrowed its 2026 guidance range but lifted its profit outlook on stronger Keytruda and new product trends, a positive for earnings power even as revenue bands were tightened. Merck beats quarterly estimates on strength of Keytruda and new products, narrows outlook
• Positive Sentiment: Clinical pipeline progress: Merck dosed the first patient in Phase 3 studies of enpatoran for lupus skin manifestations — a near‑term clinical milestone that could add long‑term pipeline value if successful. Merck Announces First Dose in Phase 3 Study with Enpatoran
• Neutral Sentiment: Calls and disclosures available: The full Q1 earnings call transcript and the investor slide deck are posted for deeper review of sales mix, margin drivers and forward guidance assumptions. Q1 2026 Earnings Call Transcript Earnings Presentation
• Neutral Sentiment: Minor analyst estimate moves: Some shops trimmed FY forecasts modestly (e.g., Erste’s slight EPS tweak), indicating traders are tweaking models but not overhauling consensus. MRK Q1 Earnings & Sales Beat; 2026 Sales View Tightened
• Negative Sentiment: One‑time acquisition charge produced a GAAP loss: Merck reported a quarterly loss driven by a Cidara‑related acquisition charge, which suppresses headline earnings and can weigh on near‑term sentiment. Merck posts quarterly loss due to Cidara charge
• Negative Sentiment: Tighter revenue guidance and mixed product trends: Management narrowed the sales range for 2026 and flagged mixed growth among some newer and legacy products, which leaves upside constrained and raises uncertainty about sustained top‑line acceleration. Merck Q1 earnings beat; 2026 guidance narrowed
• Negative Sentiment: Market concerns about future sales erosion: Commentary and coverage highlighted risks from expected declines in certain legacy drugs (HPV vaccine, diabetes medicine) and the company’s efforts to offset those losses, which contributes to investor caution. Merck Stock Falls After Earnings

Insider Buying and Selling at Merck & Co., Inc.

In related news, EVP Richard R. Deluca sold 37,685 shares of the firm's stock in a transaction that occurred on Friday, February 6th. The stock was sold at an average price of $120.92, for a total transaction of $4,556,870.20. Following the completion of the transaction, the executive vice president owned 160,174 shares in the company, valued at $19,368,240.08. This trade represents a 19.05% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through the SEC website. Also, CEO Robert M. Davis sold 47,434 shares of the firm's stock in a transaction that occurred on Wednesday, February 4th. The stock was sold at an average price of $118.04, for a total value of $5,599,109.36. Following the transaction, the chief executive officer owned 443,602 shares of the company's stock, valued at $52,362,780.08. This trade represents a 9.66% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold 320,176 shares of company stock worth $38,281,735 over the last three months. 0.17% of the stock is currently owned by insiders.

Hedge Funds Weigh In On Merck & Co., Inc.

Several institutional investors have recently bought and sold shares of MRK. Wellington Management Group LLP raised its position in Merck & Co., Inc. by 14.8% in the 4th quarter. Wellington Management Group LLP now owns 86,435,458 shares of the company's stock valued at $9,098,196,000 after purchasing an additional 11,156,354 shares during the last quarter. Price T Rowe Associates Inc. MD raised its position in Merck & Co., Inc. by 37.9% in the 4th quarter. Price T Rowe Associates Inc. MD now owns 18,753,390 shares of the company's stock valued at $1,973,983,000 after purchasing an additional 5,152,069 shares during the last quarter. Marshall Wace LLP raised its position in Merck & Co., Inc. by 985.4% in the 4th quarter. Marshall Wace LLP now owns 3,969,469 shares of the company's stock valued at $417,826,000 after purchasing an additional 3,603,769 shares during the last quarter. Federated Hermes Inc. raised its position in Merck & Co., Inc. by 590.9% in the 4th quarter. Federated Hermes Inc. now owns 2,492,038 shares of the company's stock valued at $262,312,000 after purchasing an additional 2,131,343 shares during the last quarter. Finally, AQR Capital Management LLC raised its position in Merck & Co., Inc. by 21.3% in the 3rd quarter. AQR Capital Management LLC now owns 10,658,099 shares of the company's stock valued at $851,369,000 after purchasing an additional 1,870,827 shares during the last quarter. Institutional investors own 76.07% of the company's stock.

Analyst Upgrades and Downgrades

Several analysts have recently weighed in on the company. JPMorgan Chase & Co. lifted their price objective on Merck & Co., Inc. from $125.00 to $135.00 and gave the stock an "overweight" rating in a report on Monday, April 6th. Wolfe Research raised Merck & Co., Inc. from a "peer perform" rating to an "outperform" rating and set a $135.00 price objective on the stock in a report on Thursday, January 8th. Barclays assumed coverage on Merck & Co., Inc. in a report on Friday, February 20th. They set an "overweight" rating and a $140.00 price objective on the stock. Cantor Fitzgerald lifted their price objective on Merck & Co., Inc. from $116.00 to $120.00 and gave the stock a "neutral" rating in a report on Wednesday, February 4th. Finally, Citigroup lifted their price objective on Merck & Co., Inc. from $120.00 to $125.00 and gave the stock a "neutral" rating in a report on Friday, March 20th. One research analyst has rated the stock with a Strong Buy rating, eleven have assigned a Buy rating and seven have assigned a Hold rating to the company. According to MarketBeat.com, the stock has a consensus rating of "Moderate Buy" and an average price target of $128.47.

Merck & Co., Inc. Company Profile

Merck & Co, Inc is a global biopharmaceutical company engaged in the discovery, development, manufacture and marketing of prescription medicines, vaccines, biologic therapies and animal health products. Its portfolio spans multiple therapeutic areas with a particular emphasis on oncology, vaccines and infectious disease, as well as therapies for metabolic and chronic conditions. Among its well-known products are the cancer immunotherapy Keytruda (pembrolizumab) and the human papillomavirus vaccine Gardasil; the company also markets a range of medicines and vaccines for veterinary use through Merck Animal Health.

Founded in the late 19th century as the U.S.

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