Pfizer’s stock is experiencing a decline ahead of the opening bell due to the company’s revision of its full-year financial outlook . The company cited a decrease in sales of its COVID-19-related products as the primary reason for this adjustment.
Pfizer’s shares are on a decline on the first trading day after the pharmaceutical company announced weaker-than-expected sales for its COVID-19 vaccine and treatment. As a result, they have revised their revenue projections for the year, reducing them by $9 billion.
These decreased sales have impacted Pfizer’s performance in the second quarter. However, in August, the company had anticipated a rebound in the second half of 2023. Despite this, shares of Pfizer have fallen by more than 1% before the market opening on Monday, and Moderna, a company highly dependent on its competing vaccine, also saw a nearly 5% decrease.
Pfizer reported that global usage of its Paxlovid treatment is slightly above last year’s levels, but it still falls below expectations. The fall vaccination season has just begun, and Pfizer mentioned that it’s too early to gauge vaccination rates for the entire year.
The full-year revenue expectations for Paxlovid and Comirnaty now stand at approximately $12.5 billion, which is $9 billion less than the initial projections. Specifically, Pfizer is lowering its full-year revenue outlook for Paxlovid by approximately $7 billion due to a delayed product commercialization, now expected in January 2024 instead of the second half of this year. Additionally, the 2023 revenue projections for Comirnaty are being reduced by approximately $2 billion, mainly because of lower vaccination rates.
As a result of these changes, Pfizer’s 2023 revenue forecast now falls within a range of $58 billion to $61 billion, down from the earlier estimate of $67 billion to $70 billion. The company anticipates adjusted earnings for the year between $1.45 and $1.65 per share, which is below the expectations of Wall Street, and significantly less than the company’s previous per-share earnings projections of $3.25 to $3.45.
JPMorgan suggests that Pfizer’s update addresses an ongoing debate regarding U.S. Paxlovid inventory and expects that the company’s substantial reductions in sales projections will help stabilize per-share earnings expectations for the next year.