$MRK · Merck & Co., Inc.
Merck reported Q3 2026 results with worldwide sales of $18.085B (+5% YoY), GAAP EPS of $2.04, and Non-GAAP EPS of $2.49. KEYTRUDA sales reached $8.6B (+6%) while WINREVAIR surged 93% to $694M. The company narrowed and raised FY2026 guidance: sales to $66.8B–$67.3B and Non-GAAP EPS to $2.77–$2.82, both including a $0.12/share SciBrunch license charge.
- Q3 worldwide sales $18.085B, +5% YoY (+4% ex-FX), driven by KEYTRUDA at $8.6B (+6%) and WINREVAIR at $694M (+93%)
- GAAP EPS $2.04 vs $2.32 prior year; Non-GAAP EPS $2.49 vs $2.58, both include $0.12/share one-time SciBrunch license charge
- GAAP gross margin fell to 72.9% from 77.7% on higher amortization, restructuring costs, and production costs
- FY2026 sales guidance narrowed and raised to $66.8B–$67.3B; Non-GAAP EPS guidance narrowed and raised to $2.77–$2.82
- R&D expenses rose 7% to $4.5B, including $400M SciBrunch charge, partially offset by $200M Blackstone funding agreement
Extended-hours trading shows MRK at $143.25, +1.51% vs the regular close of $141.12, suggesting a positive initial reaction to the raised guidance despite the EPS decline. Markets were closed at filing; the full regular-session reaction is pending.
Merck's guidance raise and pipeline catalysts — including the first Phase 3 validation of a therapeutic cancer vaccine (INTerpath-001 with Moderna) — signal confidence in life beyond KEYTRUDA's eventual patent cliff.
Merck's KEYTRUDA franchise continues to dominate oncology at a $34B+ annualized run rate. The sac-TMT BLA acceptance and INTerpath-001 melanoma vaccine data with Moderna position Merck to defend against post-2028 KEYTRUDA LOE. WINREVAIR's 93% growth trajectory signals a credible second pillar emerging in cardiovascular.
KEYTRUDA concentration risk: the single product represents $8.6B of $18.1B quarterly sales (47.5%). Generic erosion continues with BRIDION down 67% and JANUVIA/JANUMET down 39% YoY. GAAP gross margin compression of 480 bps YoY signals rising cost pressures from amortization and restructuring.