Gilead Sciences Stock: HIV Leader Posts Strong Quarter Amid Market Caution

While numerous biotechnology firms grapple with disappointing quarterly earnings, Gilead Sciences stands out with a robust performance. The pharmaceutical giant not only surpassed market expectations but also upgraded its full-year guidance. Despite these solid results, investor reaction remained notably subdued, raising questions about what the market has already priced in.

The company now projects adjusted earnings per share will land between $8.05 and $8.25 for the year. It has also raised its HIV sales growth forecast to approximately 5%. Although total product revenue saw a slight 2% decline to $7.3 billion, primarily due to reduced sales of the COVID-19 treatment Veklury, the underlying business demonstrated significant resilience. Excluding Veklury, product sales actually increased by 4%, reaching $7.1 billion.

HIV Portfolio Continues to Drive Performance

Gilead's sustained success continues to be powered by its dominant HIV franchise. The flagship drug Biktarvy posted a strong 6% gain, generating $3.7 billion in revenue. A crucial development for the company's long-term outlook came from the patent arena. Through settlements in patent litigation, protection for Biktarvy has been extended until April 2036—more than two years longer than previously anticipated.

Should investors sell immediately? Or is it worth buying Gilead Sciences?

Pipeline Innovation and Future Catalysts

The market's restrained response, with shares hovering near €107 and approaching the 52-week high of €110.68, suggests that much of the positive news was already reflected in the stock price. However, a significant test looms on the horizon. In December, Gilead is scheduled to present key study data for Anito-cel, a promising multiple myeloma treatment, at the ASH conference. A positive outcome from this oncology pipeline asset could signal the next major growth phase for the biotech leader.

Another bright spot emerged from the newly launched HIV prevention therapy, Yeztugo. Approved in the US just this past June, the medication has already achieved $39 million in sales and secured coverage with 75% of payers—a pace that has exceeded initial projections. The drug's significance was further underscored when it received the prestigious Prix Galien USA Award for best pharmaceutical product.