Pfizer misses revenue estimates, says it may cut costs if Covid product sales continue to disappoint
Pfizer on Tuesday reported second-quarter adjusted earnings that topped Wall Street's expectations, but posted revenue that fell short of estimates due to a plunge in Covid product sales.

The company also said it is prepared to cut costs if Covid-related revenue continues to disappoint this year.

Here's how Pfizer results compared with Wall Street expectations, based on a survey of analysts by Refinitiv:

Earnings per share: 67 cents per share adjusted, vs. 57 cents per share expected

67 cents per share adjusted, vs. 57 cents per share expected Revenue: $12.73 billion, vs. $13.27 billion expected

Pfizer reported second-quarter sales of $12.73 billion, down 54% from the same period a year ago.

"The contraction in revenues was driven by the anticipated decline in Paxlovid and Comirnaty sales," Pfizer CFO David Denton said during an earnings call on Tuesday.

The company's Covid vaccine raked in $1.49 billion in sales, down 83% from the year-ago quarter. Pfizer's Covid antiviral pill Paxlovid posted $143 million in revenue, a drop of 98%.

Together, the products pulled in $1.6 billion in revenue for the quarter. That compares with roughly $17 billion in sales during the same period a year ago.

The company reaffirmed its forecast of $13.5 billion in Covid vaccine sales and $8 billion in revenue for Paxlovid for 2023.

But Denton noted that Pfizer is prepared to launch a cost-cutting program if Covid product revenues for the full year are "less than what we assumed." He added that Pfizer would design the strategy to support its goal of growing its operating profit margin, and expects the effort to "begin to yield results in 2024."

"We look forward to sharing specific details of this program in our upcoming earnings calls," Denton said during the call.

Pfizer and rival drugmakers like Moderna have seen a steep drop in Covid-related sales this year as the world emerges from the pandemic and relies less on blockbuster vaccines and treatments that help protect against the virus.

Pfizer, Moderna and Novavax are preparing for the U.S. to shift Covid products to the commercial market, which means those companies will start selling vaccines and treatments directly to health-care providers this fall.

For the second quarter, Pfizer booked net income of $2.33 billion, or 41 cents per share. That fell from $9.91 billion, or $1.73 per share, during the same period a year ago.

Excluding certain items, the company's earnings per share were 67 cents per share for the quarter.

Looking ahead, the New York-based company narrowed its 2023 sales forecast to $67 billion to $70 billion, from a previous forecast of $67 billion to $71 billion.

Pfizer reiterated its full-year adjusted earnings outlook of $3.25 to $3.45 per share.

Pfizer CEO Albert Bourla said during an earnings call Tuesday that there is clearly a "higher level of uncertainty" about demand projections for Covid products than for the rest of the company's business.

He noted that the second half of the year will "play a bigger role in informing our expectations for the long-term demand" of the company's Covid vaccine and Paxlovid. Utilization "follows very closely" with Covid infection rates, he said.

"We expect a new COVID-19 wave to start in the U.S. this fall, and this expectation is supported by the increase in infection rates we are already seeing," Bourla said, referring to a slight uptick in Covid cases reported to the Centers for Disease Control and Prevention over the last few weeks.

Pfizer's stock closed more than 1% lower on Tuesday. The company's shares have dropped roughly 30% this year, putting Pfizer's market value at roughly $201 billion.