Merck & Co., Inc. NYSE: MRK reported first-quarter 2026 revenue of $16.3 billion, up 5% year over year, as the company highlighted continued oncology momentum, growing contributions from newer launches, and a series of regulatory and pipeline milestones discussed on its quarterly sales and earnings conference call.
Quarterly performance driven by oncology, animal health, and new products
Chairman and CEO Rob M. Davis said Merck delivered “year-over-year growth with revenue of $16.3 billion, driven by continued strength in oncology, Merck Animal Health, and growing contributions from new products.” He added that the company’s portfolio “transformation … to a far more diversified set of commercial drivers is now well underway,” citing initial launches of more than 20 new products that Merck believes “almost all … have blockbuster potential.”
Chief Financial Officer Caroline Litchfield said total revenue increased 5%, or 3% excluding foreign exchange. In oncology, sales of the KEYTRUDA family rose 8% to $8.0 billion on strong demand in metastatic indications and uptake in earlier-stage cancers. Litchfield said increased use in tumors “that primarily affect women, including breast and cervical cancers,” contributed to growth, along with increased use of KEYTRUDA in combination with PADCEV in urothelial cancer. She also noted U.S. growth benefited by about $250 million due to the timing of purchases, which she said will create a corresponding headwind in the third quarter.
Litchfield said KEYTRUDA QLEX generated $128 million in quarterly sales and received a permanent J-code on April 1. Beyond KEYTRUDA, WELIREG sales increased 43% to $199 million, driven by international launch uptake and increased U.S. use in certain previously treated advanced renal cell carcinoma patients.
In vaccines and infectious diseases, Gardasil sales were $1.1 billion, down 22%, which Litchfield attributed to “lower demand in China and Japan, consistent with our expectations,” and to timing of U.S. CDC purchases. In pneumococcal, CAPVAXIVE sales rose 31% to $142 million, supported by ongoing launches outside the U.S. and increased U.S. demand, partly offset by a reduction in wholesaler inventory.
In cardiometabolic and respiratory, WINREVAIR posted global sales of $525 million, which Litchfield said reflected continued demand. She said the company saw “more than 1,600 new patients” in the U.S. receiving a prescription in the quarter. Otivus, described as a novel maintenance treatment for adults with COPD, delivered $131 million in sales and was “adversely impacted by the CMS reimbursement change, as well as Medicare deductible resets,” though Merck said prescription trends began to recover in March.
Merck Animal Health revenue increased 6%. Litchfield said livestock sales grew 8% due to demand for ruminant and poultry products and price, while companion animal sales rose 4% due to new launches and price, partially offset by fewer veterinary visits. Davis highlighted the U.S. launch of Numelvi, which he called the “first and only second-generation JAK inhibitor for allergic dermatitis in dogs.”
One-time acquisition charge drives GAAP loss; Merck raises non-GAAP guidance midpoint
Litchfield said operating expenses rose to $15.2 billion, including a $9 billion one-time charge related to the acquisition of Sedera Therapeutics. Excluding that charge, she said operating expenses increased 2% due to higher investments behind growth drivers, partially offset by benefits from Merck’s multi-year optimization effort and external funding recognition tied to sac-TMT. Merck reported a loss of $1.28 per share, which included a negative impact of $3.62 per share from the Sedera charge.
On a non-GAAP basis, Merck narrowed its full-year 2026 guidance ranges and raised the midpoints. The company now expects:
- Revenue: $65.8 billion to $67.0 billion (1% to 3% growth), including about 1 point of FX benefit using mid-April rates
- Gross margin: approximately 82%
- Operating expenses: $36.0 billion to $36.8 billion (excluding the proposed Terns acquisition and any additional significant BD)
- Other expense: approximately $1.3 billion
- Tax rate: 23.5% to 24.5% (reflecting the non-tax-deductible Sedera charge)
- EPS: $5.04 to $5.16, including about $0.10 of FX benefit
She said guidance does not include the proposed acquisition of Terns Pharmaceuticals, which Merck expects to close soon. Merck anticipates a one-time charge that would increase R&D expense by approximately $5.8 billion, or about $2.35 per share, as well as ongoing EPS headwinds of about $0.12 this year from investment and financing.
Pipeline and regulatory updates: oncology, cardiometabolic, HIV, RSV, and ophthalmology
Merck Research Laboratories President Dean Y. Li outlined a “steady cadence of clinical and regulatory development,” including updates across cardiometabolic and respiratory, oncology, infectious diseases, and ophthalmology.
In cardiometabolic disease, Li pointed to additional phase III data for enlicitide, Merck’s investigational oral PCSK9 inhibitor, presented at the American College of Cardiology meeting. He said the phase III CORALreef add-on study showed “statistically significant and clinically meaningful” LDL cholesterol reductions at eight weeks versus other oral add-on therapies. During Q&A, Li said Merck is engaged in discussions with FDA under the commissioner’s national priority voucher (CMPV) process and reiterated his view that an approval in the second half of the year remains possible, while noting labeling discussions are ongoing.
Li also discussed WINREVAIR, noting phase II CADENCE results in a combined post- and pre-capillary pulmonary hypertension population with heart failure preserved ejection fraction. WINREVAIR met the primary endpoint of pulmonary vascular resistance reduction versus placebo, and at the 0.3 mg/kg dose prolonged time to first clinical worsening event (exploratory secondary endpoint) with a hazard ratio of 0.18. Li said discussions with FDA will focus on endpoints such as time to clinical worsening and inclusion criteria in a phase III program.
In oncology, Li said KEYTRUDA has 44 FDA-approved indications across 19 tumor types, plus two tumor-agnostic approvals. He noted FDA and European Commission approvals for KEYTRUDA in combination with paclitaxel with or without bevacizumab for certain platinum-resistant ovarian cancer patients based on KEYNOTE-B96, calling it “the first PD-1 inhibitor-based regimen” to show statistically significant improvements in both progression-free survival and overall survival versus the comparator regimen.
Li also highlighted KEYNOTE-B15 findings in muscle-invasive bladder cancer, saying KEYTRUDA plus PADCEV reduced risk of event-free survival events by 47% and reduced risk of death by 35% versus platinum-eligible patients. He said FDA accepted supplemental BLA filings for KEYTRUDA and KEYTRUDA QLEX under priority review, targeting an Aug. 17 action date.
For WELIREG, Li discussed renal cell carcinoma data from the LITESPARK program, including LITESPARK-022 (WELIREG plus KEYTRUDA in adjuvant setting) showing a 28% reduction in risk of recurrence or death versus KEYTRUDA alone, and LITESPARK-011 (WELIREG plus LENVIMA) showing a 30% reduction in risk of progression or death versus cabozantinib in certain advanced RCC patients. He said FDA granted priority review to supplemental applications for WELIREG plus KEYTRUDA or KEYTRUDA QLEX with a June 19 PDUFA date, and set an Oct. 4 PDUFA date for WELIREG plus LENVIMA.
Li said a separate first-line RCC study, LITESPARK-012, did not meet its dual primary endpoints of progression-free and overall survival versus KEYTRUDA plus LENVIMA, though he said Merck is studying the data for learnings and cautioned against reading through negatively to other trials that evaluate two-agent combinations.
Merck also cited progress in antibody-drug conjugates. Li said partner Kelun will present OptiTROP-Lung05 data in first-line non-small cell lung cancer at ASCO, and he emphasized differences in PD-L1 cutoffs between China and ex-China settings when evaluating results. In response to an analyst question, Li said Merck is “very interested” in PD-1/VEGF approaches and is “eager to move” its program forward, while also considering potential combinations with other portfolio assets, including sac-TMT.
In infectious diseases, Davis said the FDA approved Idvynso as a new treatment option for adults with virologically suppressed HIV-1. Li described Edvinso as a once-daily, single-tablet two-drug regimen (doravirine and islatravir) and said it is “the first approved two-drug regimen that does not include an integrase strand transfer inhibitor.” He said islatravir is being evaluated in late-stage trials as a once-weekly combination with Gilead’s lenacapavir and separately with an internally developed non-nucleoside reverse transcriptase inhibitor, ulonivirine.
Li also described new RSV data for Inflanzia from the phase III SMART study supporting prevention of RSV lower respiratory tract disease over two seasons in higher-risk infants and young children, which Merck plans to share with regulators with the intent to seek an expanded indication. He noted European Commission approval of Inflanzia for prevention of RSV disease in newborns and infants during their first season.
In ophthalmology, Li said Merck initiated phase IIb/III trials (MELBAC and TORONTE) for MK-8748, an investigational bispecific Tie-2 agonist VEGF inhibitor for neovascular age-related macular degeneration, based on phase I/IIa results from RIOJA. In Q&A on MK-3000, Li said initial dosing evaluation typically begins at every four weeks, with consideration of other frequencies later, adding that Merck is also advancing MK-8748 in late-phase development.
Business development, operating model changes, and AI partnerships
Davis said Merck’s planned acquisition of Terns Pharmaceuticals reflects its “science-led business development strategy,” describing TERN-701 as having potential to be best-in-class in chronic myeloid leukemia and calling its commercial opportunity “multibillion-dollar.” During Q&A, Davis said Merck’s BD “sweet spot” is generally in the $1 billion to $15 billion range, while maintaining capacity to go beyond that for the right deal. He named oncology, immunology, and cardiometabolic as key areas of interest, while stressing the company starts with scientific opportunity and strategic fit rather than fixed therapeutic-area targets.
In a separate Q&A exchange about TERN-701 data, Li said Merck’s internal assessment—based on patient-level review and an intent-to-treat perspective—suggests major molecular response will be “north of 50% and within the confidence interval as had been publicly stated,” adding that Merck views that range as “extremely compelling.”
Merck also outlined organizational changes intended to support execution of its expanding launch slate. Davis said the company is moving to a business-unit model organized around products and therapeutic areas to “drive accountability, sharpen focus, and increase agility.” He highlighted leadership appointments including Brian Foard to lead Specialty, Pharma and Infectious Diseases; Jannie Oosthuizen to lead Global Oncology and MSD International; and Chirfi Guindo to lead Strategic Access, Policy and Communications.
Davis additionally pointed to a multi-year partnership with Google Cloud to scale AI capabilities, alongside an expanded collaboration with Tempus AI and a new agreement with the Mayo Clinic to leverage clinical insights and genomic datasets.
Litchfield reiterated Merck’s capital allocation priorities, including continued investment in launches and pipeline, commitment to the dividend with a goal to increase over time, and share repurchases “on pace for approximately $3 billion” in 2026. She said Merck retains flexibility, within a strong investment-grade profile, to pursue additional “science-driven, value-enhancing transactions.”
About Merck & Co., Inc. NYSE: MRK
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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