Novo Nordisk will release its FY 2025 Q3 earnings report on August 6 before the U.S. market opens.
The market generally expects the company's performance to be under pressure, especially amidst intensified competition in the weight loss drug market. According to Bloomberg consensus forecasts:
Revenue: Expected to be 77.03 billion Danish kroner, a 13.2% year-over-year increase (though slower than previous growth expectations).
Adjusted net profit: Expected to be 26.94 billion Danish kroner, up 34% year-over-year.
Adjusted EPS: Expected to be 6.04 Danish kroner, up 34% year-over-year.
However, due to the company's recent downward revision of its annual guidance, the market remains cautious about Q2 actual performance, with the stability of sales data for Wegovy and Ozempic being crucial.
Novo Nordisk's FY 2025 Q1 performance showed signs of weakness, with multiple key indicators missing expectations:
Sales: 78.1 billion Danish kroner (approximately $11.3 billion), a 19% year-over-year increase (+18% at constant exchange rates), slightly below the expected 78.7 billion Danish kroner.
Operating profit: 38.8 billion Danish kroner (approximately $5.6 billion), a 22% year-over-year increase (CER +20%), exceeding market expectations.
Net profit: 29.03 billion Danish kroner, up 14% year-over-year, higher than expected.
Operating profit margin: 49.7%, significantly above the expected 47.5%.
Core Product Performance:
Wegovy (weight loss drug): Sales of 17.36 billion Danish kroner (+85%), but below the expected 18.98 billion Danish kroner.
Ozempic (diabetes/weight loss injection): Sales of 32.72 billion Danish kroner, slightly above expectations.
Rybelsus (oral GLP-1): Sales of 5.7 billion Danish kroner, below the expected 6.23 billion Danish kroner.
Weak Q1 Wegovy sales, along with the impact of U.S. generic drugs, have raised doubts about Novo Nordisk's growth prospects.
Novo Nordisk is facing its most severe challenge in its development history. The stock price plunged on July 29, erasing over €60 billion in market value, reflecting not only disappointment in its performance but also revealing deep-seated strategic crises. This quarter's earnings report will be a critical turning point in assessing whether the company can reverse its downward trend.
The crisis was triggered by the company's sudden downward adjustment of its 2025 earnings guidance: Revenue growth expectations were dramatically reduced from 13%-21% to 8%-14%, and operating profit growth expectations were lowered from 16%-24% to 10%-16%. Such a drastic expectation adjustment has led investors to question whether Novo Nordisk has lost control over the market. Further unsettling the market is the announcement of a change in CEO, with international business lead Mike Doustdar taking over. Whether this new leader can present a clear path to recovery during the earnings call will be a crucial factor affecting market sentiment.
An in-depth analysis of Novo Nordisk's predicament reveals three major strategic missteps hindering the company's development. Firstly, serious misjudgment in capacity planning. The company planned the production capacity for Wegovy and Ozempic based on the market response to the older Saxenda, severely underestimating market demand. Persistent supply shortages have led to a "patient exodus" in the U.S. market. As competitor 礼来 quickly resolved capacity bottlenecks, Novo Nordisk missed the optimal timing.
Secondly, substantial delay in commercialization rhythm. Lilly launched its direct sales platform LillyDirect in early 2024, successfully capturing market share for self-paying users, whereas Novo Nordisk only introduced NovoCare this March, missing a 15-month golden window. More critically, the company has continued to rely on traditional academic promotion models, failing to adapt to the trend of weight loss drugs becoming consumer products. Additionally, its globally diversified resource allocation strategy has weakened its competitiveness in the key U.S. market.
The third issue is a gap in research pipeline. The promising next-generation weight loss drug CagriSema achieved only 23% weight reduction in clinical trials, failing to meet the expected 25% target. Meanwhile, Lilly’s oral GLP-1 drug Orforglipron is progressing smoothly and expected to hit the market in 2026, which may further alter the competitive landscape.
The latest market data shows Novo Nordisk is losing its dominant position. According to IQVIA’s report, Lilly’s Mounjaro has surpassed Ozempic in prescription volume in the U.S., while Zepbound is rapidly eroding Wegovy’s market share. More concerning is the widespread feedback among physicians, who generally consider Lilly’s product superior in weight loss efficacy and side effect management.
To add insult to injury, the U.S. market faces a "generic drug crisis". The rampant illegal compounded GLP-1 drugs have severely impacted Wegovy’s penetration in cash payment channels, with the company acknowledging that this phenomenon will continue to affect second-half performance. Faced with such intense competition, Novo Nordisk urgently needs to find effective countermeasures.
The new CEO, Mike Doustdar, is tasked with navigating the company out of its predicament. In an emergency call, he candidly stated, "I don’t like the current stock price, but what determines the company’s fate is not the setbacks themselves, but how we respond." This statement hints at sweeping reforms on the horizon.
Doustdar faces three-fold challenges: In the short term, he must "stop the bleeding" in the U.S. market, tackle the impact of generic drugs, and optimize insurance coverage strategies; mid-term, he needs to reshape business efficiency, reform the sales system, and enhance digital marketing capabilities; long-term, he must expedite breakthroughs in the pipeline, advance next-generation weight loss drug development, and consider strategic acquisitions to strengthen the product line. Investors are eager to hear more specific reform plans at this earnings call.
Despite facing numerous challenges, some institutions remain optimistic about Novo Nordisk’s long-term value. 高盛 maintains a "buy" rating, with a target price of 745 Danish kroner, suggesting a potential upside of 65%. Their rationale is that the weight loss drug market is far from saturated, with over 1 billion obese patients globally, and Novo Nordisk still has advantages in manufacturing capability and global channels.
However, bearish views should not be overlooked. Barclays points out that Novo Nordisk’s commercialization falls behind Lilly by at least 12-18 months; Mizuhuo warns of potential valuation bubble risk within the entire weight loss drug industry. The fierce debate between bullish and bearish views aptly reflects the current market's high uncertainty.
At this critical juncture, this earnings report will answer one fundamental question: Is Novo Nordisk's crisis a short-term pain or the beginning of a long-term decline? Investors need to pay attention to three dimensions: whether Wegovy and Ozempic’s actual sales data stabilizes; whether the new CEO’s strategy is clear and feasible; and the company’s effective countermeasures against Lilly's competition. Only if all three aspects provide positive answers can Novo Nordisk truly regain market confidence.
Content is based on tiger AI and Bloomberg data for reference only.
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