Pfizer Q2 2022 Earnings Report Recap

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Pfizer (PFE) Financial Results: Analysis

Pfizer Inc. (PFE) reported Q2 FY 2022 earnings results that solidly surpassed analyst expectations. Adjusted earnings per share (EPS) surged by 92.5% relative to the year-ago quarter, beating expectations by a wide margin. Pfizer's revenue grew by 46.8% year-over-year (YOY). While this was a slower pace of growth in this area than the last quarter on a sequential basis, revenue nonetheless also far exceeded analyst expectations. Approximately 37.7% of this revenue was from vaccine sales, including sales of the company's COVID-19 vaccine, developed with German-based BioNTech SE (BNTX).

PFE COVID-19 Vaccine

A significant contribution to Pfizer's revenue growth came from its vaccine business, including sales of two products related to COVID-19: Comirnaty, the company's vaccine against the disease; and Paxlovid, its oral antiviral treatment against COVID-19. Paxlovid contributed $8.1 billion in worldwide sales for the quarter. Excluding sales from Comirnaty and Paxlovid, Pfizer's revenue increased 1% operationally (operational revenue excludes the impact of foreign exchange rates).

Paxlovid received emergency use authorization (EUA) by the Food and Drug Administration (FDA) in December 2021. It is a prescription-only medication used for treating cases of COVID-19 in adults and pediatric patients at least 12 years of age or weighing at least 88 pounds. It is the first oral antiviral treatment for COVID-19 to receive EUA. In June, Pfizer submitted a New Drug Application (NDA) to the FDA for Paxlovid for the treatment of patients at high risk of severe illness from COVID-19, consistent with the current EUA.

Pfizer, in collaboration with BioNTech, was also the first company to receive an EUA from the FDA for its vaccine. In August 2021, it also became the first company to gain full approval from the FDA for use of its vaccine in individuals 16 years of age or older. In October, the FDA authorized the Pfizer-BioNTech vaccine for emergency use by millions of children 5 through 11 years of age. The FDA approved at the end of March a second booster dose of the vaccine for people 50 years of age and older and certain immunocompromised individuals. In June, the FDA authorized Comirnaty for emergency use by children as young as 6 months of age.

PFE Outlook and Stock Performance

Pfizer affirmed its FY 2022 guidance for Comirnaty and Paxlovid revenue of roughly $32 billion and $22 billion, respectively. It raised its operational guidance for total revenue and adjusted EPS for FY 2022 by about $2 billion and 24 cents, respectively. Including the impact of foreign exchange rates, the company's guidance for revenue remains $98 billion to $102 billion, while the guidance for adjusted EPS becomes $6.30 to $6.45, adjusted slightly from $6.25 to $6.45.

PFE Conference Call Recap

In an earnings call after results were announced, Pfizer Chief Executive Officer (CEO) Albert Bourla indicated that his company will continue to see strong demand for its Covid-19 treatments.

“After 2½ long years, like everyone else, we would hope that this global health crisis would be over soon,” Bourla said. “But as much as hope is important, hope is not science. And science is telling us that Covid-19 likely will remain a major global healthcare concern for years to come." The company said it is focusing on developing the next generation of Covid-19 vaccines as well as new uses for existing Covid-19 products.

After briefly rising, Pfizer shares traded roughly sideways in pre-market trading hours July 28 after the company's earnings report. The company's stock has provided a 1-year trailing total return of 27.6%, well ahead of the -8.6% total return of the S&P 500, as of July 28.

Pfizer's next earnings report (for Q3 FY 2022) is expected to be released on Nov. 1, 2022.