Bristol Myers Squibb (BMY) Q4 2025 earnings review
Growth Portfolio Wins the Quarter, but Legacy Drag Wins the Year
BMS is executing its pivot, but the math remains stubborn. In Q4, the Growth Portfolio surged 16% to $7.4B, finally overtaking the collapsing Legacy business ($5.1B, -15%). However, the transition friction is palpable in the 2026 guidance, which calls for a revenue contraction to ~$46.75B (midpoint) from $48.2B in 2025. While Eliquis (+8%) defied Part D headwinds and new launches like Cobenfy are ramping, the patent cliff for Revlimid and Sprycel is eroding the top line faster than the new pipeline can backfill it. EPS of $1.26 beat muted expectations but was heavily weighed down by a $0.60 IPRD charge, signaling that this transition remains expensive.
🐂 Bull Case
The Growth Portfolio now generates nearly 60% of total revenue ($7.4B vs $5.1B Legacy). With Reblozyl (+22%), Camzyos (+59%), and Breyanzi (+49%) firing on all cylinders, the company is successfully reducing its reliance on expiring assets.
Despite widespread fears regarding Medicare Part D redesign and pricing pressures, Eliquis grew 8% YoY to $3.45B. Management guides for 10-15% growth in 2026, suggesting the franchise has significantly more durability than the market priced in.
🐻 Bear Case
Management's 2026 guidance ($46.0-$47.5B) implies a ~3% revenue decline vs. FY25 ($48.2B). The 'Growth' story is technically a 'Shrink' story for the next 12 months as the legacy portfolio sheds another 12-16%.
Non-GAAP Gross Margin compressed from 74.0% in 24Q4 to 71.9% in 25Q4. The favorable mix of Revlimid is gone, and the new launch portfolio carries lower initial margins. 2026 guidance sees margins falling further to ~69-70%.
⚖️ Verdict: ⚪
Neutral. The execution on the Growth Portfolio is impressive, but the 2026 financial reality involves shrinking revenue and compressing margins. Until the pipeline creates net growth rather than just offset, the stock lacks a near-term catalyst.
Key Themes
The 'New Big 3' Carry the Load
Opdivo, Reblozyl, and Camzyos are doing the heavy lifting. Opdivo remains the anchor ($2.7B, +9%), but Camzyos is the star performer, accelerating to $353M (+59% YoY) with strong U.S. demand. Reblozyl added $120M in incremental quarterly revenue YoY (+22%). These three assets alone must offset the entirety of the Revlimid decline.
The Legacy Cliff is Steep
The erosion of legacy assets is accelerating. Revlimid collapsed 55% YoY to $602M (down from $1.34B a year ago). Sprycel fell 60% to just $79M. Pomalyst is down 16% globally. This drag is masking the double-digit success of the new portfolio and is guided to drop another 12-16% in 2026.
Cobenfy Launch: Steady, Not Explosive
Cobenfy (schizophrenia) posted $51M in Q4 revenue. While management cites 'steady growth' and >200% growth (from a low base), the sequential ramp ($35M Q2 -> $43M Q3 -> $51M Q4) suggests a linear rather than exponential adoption curve so far. Breaking 30 years of standard-of-care habits is proving to be a grind.
Gross Margin Compression
Decelerating. Non-GAAP Gross Margin fell 210bps YoY to 71.9% in Q4, and FY26 guidance points to a further drop to ~69-70%. This is structural: high-margin Revlimid is being replaced by lower-margin launch assets and alliance revenues (Eliquis) where profits are shared. This limits earnings leverage even if revenue stabilizes.
Persistent IPRD Charges
The 'clean' Non-GAAP EPS number continues to be noisy. Q4 Non-GAAP EPS of $1.26 includes a massive $0.60 hit from Acquired IPRD (Orbital Therapeutics). FY25 EPS of $6.15 included a $1.40 hit. While these signal active business development, they continuously obscure the underlying earnings power of the business.
Opdivo SubQ (Qvantig) Adoption
Accelerating. Qvantig (Opdivo Subcutaneous) revenue doubled sequentially from $67M in Q3 to $133M in Q4. This is a critical defensive play to convert the franchise before IV patent expiry. Rapid uptake here is a strong signal of franchise durability.
Other KPIs
Stable (+1% YoY). Beat expectations of significant declines, primarily due to Growth Portfolio strength (+16%) offsetting Legacy declines (-15%). Ex-FX revenues were flat.
Decelerating (-25% YoY). Down from $1.67 in 24Q4. The decline is driven by lower gross margins (mix shift) and a $0.60 per share impact from Acquired IPRD charges. Without the IPRD charge, EPS would have been ~$1.86.
Cash flow remains robust despite P&L volatility. FY25 Operating Cash Flow was reported as ~$15.1B (based on prior quarters + Q4 implied). This funded $11.1B in debt reduction and dividend payments, leaving cash balance at $10.2B.
Guidance
Decelerating/Reversing. 2025 reported revenue was $48.2B. The 2026 guide implies a 1.5% to 4.5% contraction. Management cites a 12-16% decline in Legacy Portfolio as the primary headwind.
Stable. The midpoint ($6.20) is roughly flat vs FY25 Actual ($6.15). While revenue is shrinking, cost discipline ($16.3B OpEx guide) is protecting the bottom line. Note: This guide likely assumes minimal IPRD charges, which have been historically frequent.
Decelerating. Down from 71.1% (GAAP) / 72.6% (Non-GAAP) in FY25. Continued mix shift away from mature high-margin products to profit-shared and launch-phase products.
Accelerating/Strong. Despite market fears of generic erosion or pricing pressure, BMS forecasts robust double-digit growth for its largest asset, signaling confidence in volume gains overcoming price headwinds.
Key Questions
Cobenfy Acceleration Plan
With Q4 sales at $51M, the ramp is steady but not vertical. What specific commercial levers (DTC, sales force expansion) are being pulled in 1H 2026 to accelerate this launch curve closer to blockbuster trajectory?
Gross Margin Floor
Guidance suggests margins dipping below 70% in 2026. Is this the trough, or does the increasing mix of alliance revenue (Eliquis) and lower-margin new launches mean the structural margin profile of BMS is permanently reset lower?
Legacy Portfolio Visibility
Revlimid and Sprycel missed expectations significantly in Q4. With a guided 12-16% decline for the Legacy portfolio in 2026, how much conservatism is baked in, given the accelerating rate of erosion seen in 25Q4?