Johnson & Johnson on Tuesday reported adjusted earnings and revenue that surpassed Wall Street’s expectations, while raising full-year guidance due to strong sales in the pharmaceutical and medical devices businesses.
This marks J&J’s first quarterly report since the completion of its separation from consumer health spinoff Kenvue in August, which is the largest reorganization in the company’s history.
Upon the separation, J&J revised its full-year sales and profit guidance. However, the company has now raised its outlook for 2023, with anticipated sales of $83.6 billion to $84 billion and adjusted earnings per share of $10.07 to $10.13.
J&J also disclosed a one-time, non-cash gain of $21 billion related to the split with Kenvue.
Here is J&J’s third-quarter performance compared to analysts’ expectations:
- Earnings per share: $2.66 adjusted vs. $2.52 expected
- Revenue: $21.35 billion vs. $21.04 billion expected
J&J’s stock rose slightly in morning trading on Tuesday. However, its shares have declined by nearly 11% this year, bringing the company’s market value to approximately $379 billion.
The company, considered a key indicator for the health sector, reported a 6.8% growth in sales during the quarter.
J&J’s pharmaceutical sales reached $13.89 billion, excluding its Covid vaccine. The division saw significant growth in sales of Darzalex, Erleada, and other oncology treatments.
J&J’s medical devices business generated sales of nearly $7.46 billion, driven by acquisitions and growth in electrophysiological products, wound closure products, orthopedic trauma devices, and contact lenses.
The quarterly results come amid ongoing legal challenges relating to J&J’s talc-based products. Although these products now fall under Kenvue, J&J will assume talc-related liabilities in the U.S. and Canada.
Additionally, J&J is engaging in price negotiations for its drug Xarelto with the federal Medicare program. The company continues to express reservations about these negotiations, arguing that they may hinder innovation and the development of new therapies.
An entry sign to the Johnson & Johnson campus shows their logo in Irvine, California on August 28, 2019.
Mark Ralston | AFP | Getty Images
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