Gilead Sciences delivered a better-than-expected second quarter, propelled by the strong performance of its HIV portfolio and the launch of Yeztugo, its twice-yearly injectable for HIV prevention. Management attributed the 7% year-over-year HIV growth to robust demand for Biktarvy and Descovy, along with effective commercial execution. CEO Daniel O’Day highlighted, “Biktarvy continues to lead in share in major markets around the world,” and described Descovy’s quarter as its “strongest ever,” supported by heightened awareness and growing use of pre-exposure prophylaxis (PrEP). The company also noted that new product launches, particularly Yeztugo, contributed to positive momentum, while declines in Veklury sales due to reduced COVID-19 hospitalizations partially offset gains in the base business.
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Gilead Sciences (GILD) Q2 CY2025 Highlights:
- Revenue: $7.08 billion vs analyst estimates of $7.00 billion (1.8% year-on-year growth, 1.1% beat)
- Adjusted EPS: $2.01 vs analyst estimates of $1.96 (2.7% beat)
- Adjusted EBITDA: $3.87 billion vs analyst estimates of $4.02 billion (54.7% margin, 3.6% miss)
- The company slightly lifted its revenue guidance for the full year to $28.5 billion at the midpoint from $28.4 billion
- Management raised its full-year Adjusted EPS guidance to $8.10 at the midpoint, a 2.5% increase
- Operating Margin: 34.9%, down from 38% in the same quarter last year
- Market Capitalization: $149.1 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Gilead Sciences’s Q2 Earnings Call
- Tyler Van Buren (TD Cowen) asked about the early uptake trajectory for Yeztugo and whether initial prescriptions would grow linearly or accelerate. Chief Commercial Officer Johanna Mercier said the launch was “super thrilled to see” but noted it was still early, emphasizing high prescriber engagement and the process of building access across plans.
- Terence C. Flynn (Morgan Stanley) inquired about the durability of Descovy’s growth rate and visibility of PrEP market trends. Mercier explained that robust PrEP market growth and improved access were key, but anticipated that as Yeztugo gains traction, a shift in product mix could occur.
- Umer Raffat (Evercore) questioned the impact of potential Medicaid policy changes, such as Most Favored Nation proposals, on Gilead’s revenue. CEO Daniel O’Day acknowledged industry uncertainty and highlighted that HIV’s safety net programs provide some protection, but broader policy changes remain a risk.
- Chris Schott (JPMorgan) sought clarification on the status of the WONDERS weekly HIV treatment program, which is on clinical hold. Chief Medical Officer Dietmar Berger said confidence in the pipeline remains high, with ongoing analysis to determine next steps for the program and updates expected in due course.
- Courtney Breen (Bernstein) followed up on why management did not raise Yeztugo launch expectations despite positive early access and uptake indicators. Mercier explained that the launch is only six weeks in and more time is needed to see sustained coverage and prescription momentum before updating guidance.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will monitor (1) the adoption curve and access expansion for Yeztugo in both U.S. and international PrEP markets, (2) pivotal clinical updates for ARTISTRY-1 and ARTISTRY-2, which could support new HIV treatment regimens, and (3) regulatory filings and data readouts for Trodelvy and anito-cel in oncology and cell therapy. Progress in reimbursement negotiations and updates on policy risk management will also be important indicators of execution.
Gilead Sciences currently trades at $120.22, up from $110.36 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free).
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