Bristol Myers Squibb (BMY) Q3 2026 earnings review
Bristol Myers raises its sales plan as key trials succeed
Bristol Myers Squibb grew sales on US blood-thinner pricing and newer drugs while licensing deals cut into quarterly profit. Third-quarter revenue rose 7% to $13.1 billion, above what the company's own plan pointed to, and chief executive Christopher Boerner raised the full-year sales outlook by $500 million. However, upfront drug-licensing charges pushed profit per share excluding one-offs down 17%, and by our math the updated plan leaves fourth-quarter sales flat as European Eliquis patents expire.
| Revenue | $13.07B +7% from a year ago |
|---|---|
| Growth Portfolio revenue | $7.66B +12% from a year ago (59% of total sales) |
| Profit per share, excluding one-offs | $1.35 -17% from a year ago (includes -$0.58 deal charges) |
| Full-year revenue outlook | Raised $500M middle of the range: $50.0B (+3.8% growth) |
⚖️ Verdict: 🟢 Bullish
The story got better because the pipeline delivered four late-stage clinical trial wins and on-time FDA approval for multiple-myeloma pill Zenbexus. After delays on other studies earlier this year, hitting the August approval date for Zenbexus and succeeding in the Phase 3 lung-scarring trial for Admilparant reduced the risk around the post-2028 product lineup. One caution: gross margin excluding one-offs fell 4.5 percentage points to 68.4% on product mix and a contract termination charge.
The question now is whether newer drugs and US Eliquis pricing can offset European Eliquis generic competition starting in November and a shrinking older portfolio. Optimists point to the 12% rise in the Growth Portfolio and new launches, while skeptics note that older drugs outside Eliquis shrank 55% this quarter. Initial 2027 financial targets next quarter will settle the debate.
🐂 Bull Case
FDA Approves Zenbexus and Four Trials Succeed
Bristol Myers Squibb needs new drugs to replace older medicines that are losing patent protection. In August, the US Food and Drug Administration approved Zenbexus (iberdomide), the company's first CELMoD, a new class of oral pill that breaks down disease-causing proteins. Chief executive Christopher Boerner said "The approval of Zenbexus , the first-in-class CELMoD, brings a new class of treatment to market for patients with multiple myeloma".
- Zenbexus in multiple myeloma (a blood cancer): Phase 3 study cut the risk of disease worsening or death by 51%
- Admilparant in idiopathic pulmonary fibrosis (a lung-scarring disease): Phase 3 trial met its main lung-function goal at the 60mg dose, though the 120mg dose did not reach statistical significance
- RYZ101 in neuroendocrine tumors (a rare cancer): Phase 3 trial met its main goal of slowing disease progression
- Arlo-cel in multiple myeloma and iza-bren in lung and breast cancers: each met its main trial goal
These trial wins matter because two of them — Zenbexus and Admilparant — landed on time and cleared major late-stage hurdles for the post-2028 product lineup. Initial Zenbexus sales currently sit inside a grouped product line rather than on their own row.
What to watch: standalone sales for Zenbexus and a regulatory filing for Admilparant in upcoming quarterly reports. Breaking out Zenbexus sales will show how quickly doctors adopt the new blood-cancer pill.
Newer Medicines Reach 59% of Total Sales
Bristol Myers divides its products into a Growth Portfolio of newer drugs and a Legacy Portfolio of older ones. The Growth Portfolio rose 12% from a year ago to $7.66 billion, reaching 58.6% of total revenue by our math. Earlier this year, the drugmaker also paired its research teams with AI tools from Anthropic and NVIDIA, though the release gave no new metrics on those partnerships.
- Breyanzi (a cell therapy for blood cancer): $526 million, up 46% from a year ago
- Camzyos (a heart-muscle drug): $420 million, up 42% after winning pediatric approval in September
- Reblozyl (an anemia treatment): $750 million, up 22%
- Opdivo Qvantig (an under-the-skin cancer shot): $334 million, up from $67 million a year ago, helping offset a 6% drop in intravenous Opdivo to $2.37 billion
What to watch: whether Opdivo Qvantig adds more revenue than intravenous Opdivo loses in the fourth quarter. In the third quarter, the two versions combined grew 4.2% by our math, showing the shot is expanding the franchise ahead of intravenous patent expiry.
🐻 Bear Case
Eliquis Carries Both Growth and Patent Risk
Bristol Myers raised its full-year sales outlook by $500 million at the middle of the range and attributed the increase to "broad-based and continuing momentum across the portfolio". Supporters point out that Eliquis, a blood thinner co-marketed with Pfizer, is a major cash generator this year after a US list-price cut eliminated government inflation penalties.
However, the pharmaceutical group relies heavily on this single maturing drug, which rose 25% to $4.69 billion and made up 35.9% of total company revenue by our math. US Eliquis sales jumped 39% to $3.65 billion, while international Eliquis sales fell 7% to $1.04 billion as generic copies entered early markets.
Outside Eliquis, the Legacy Portfolio shrank 55% from a year ago to $725 million by our math, as generic rivals took 47% of Revlimid sales and 81% of Pomalyst sales. Even after raising the full-year outlook, the company's plan leaves fourth-quarter total revenue at $12.47 billion by our math, down 0.3% from a year ago as European Eliquis patents expire in November.
What to watch: fourth-quarter international Eliquis revenue and the initial 2027 sales outlook next quarter. Those figures will show whether European generic erosion stays within the $1.5 billion to $2.0 billion annual drop management previously indicated.
Deal Charges Trigger a Full-Year Profit Cut
Bristol Myers includes upfront payments for outside drug licenses in its profit per share, excluding one-offs, but excludes future deals from its outlook until they close. In the third quarter, Acquired IPRD — upfront charges for buying rights to experimental medicines — rose 146% to $1.56 billion, or 11.9% of revenue, up 6.7 percentage points from a year ago.
The company said the charges "primarily reflect the execution of recent license agreements and charges associated with ongoing collaborations", which includes the Hengrui Pharma deal closed in July. Those charges reduced third-quarter profit by $0.58 per share, pushing profit per share excluding one-offs down 17% to $1.35 and forcing a $0.425 cut to the full-year profit outlook midpoint.
By our math, stripping out the net impact of licensing charges in both periods leaves third-quarter profit per share up 5.5%, at $1.93 versus $1.83 a year ago. What to watch: fourth-quarter Acquired IPRD charges, because any new business-development deal will directly reduce reported full-year profit below the updated $6.35 to $6.55 plan.
Product Mix and Contract Charge Squeeze Margins
Gross margin — the share of sales left after the cost of making the medicines and paying partner royalties — dropped sharply in the third quarter. Excluding one-offs, gross margin fell 4.5 percentage points from a year ago to 68.4%, as the cost of products sold climbed 4.5 percentage points of revenue to 31.6% ($4.13 billion).
Bristol Myers said the drop was "primarily reflecting a change in product mix and, to a lesser extent, a one-time charge related to a contract termination in 2026". When Eliquis grows 25% and high-margin blood-cancer pills Revlimid and Pomalyst shrink by more than half, profit-sharing payments to Pfizer take a larger slice of revenue.
What to watch: fourth-quarter gross margin excluding one-offs, which the unchanged 69% to 70% full-year outlook puts at 68.0% by our math. If fourth-quarter gross margin rebounds once the contract termination charge passes, the third-quarter dip was mostly a one-off rather than structural erosion.
Risks This Quarter Did Not Answer
Several standing clinical, commercial, and legal risks had no resolution in the third-quarter materials or saw their key catalysts remain in 2027.
- Delayed trial readouts: Phase 3 data for blood-thinner candidate milvexian in atrial fibrillation and Cobenfy in Alzheimer's psychosis (ADEPT) remain slated for 2027 after prior delays, while Sotyktu lupus data is still due in late 2026.
- Cobenfy prescription momentum: sales of the schizophrenia drug reached $57 million (up 33% from a year ago, but down from $63 million last quarter); the presentation cited "Potential new indications to drive next wave of growth" and "Improving patient experience through prescriber education emphasizing optimized dose utilization" without giving prescription counts.
- Patent challenges on growth drugs: the release gave no update on generic filings against Camzyos or upcoming biosimilar entry and government price cuts for Orencia.
- Celgene contingent value rights lawsuit: the release did not update the $6.4 billion litigation over Breyanzi regulatory milestones, which typically lives in the quarterly 10-Q filing.
- Debt and deal commitments: net debt fell $4.13 billion year-to-date to $29.92 billion, but future partnership payouts still must be funded as Eliquis patents expire.
👓 Other Themes
Drugmaker Commits $2.5 Billion to US Factories
In August, Bristol Myers announced two domestic manufacturing investments to support its newer medicines. The drugmaker plans to spend about $2.3 billion on a new manufacturing campus in Houston, Texas, creating nearly 500 jobs, and its RayzeBio unit will invest over $173 million in a new radiopharmaceutical facility in Whitestown, Indiana, with construction starting this year.
💲 Other KPIs
Net debt — total borrowings minus cash and marketable securities — fell 12.1% over the first nine months of 2026, down from $34.04 billion at the end of 2025. Cash and marketable securities rose to $12.96 billion while total debt dropped to $42.88 billion, reducing third-quarter interest expense by 16% from a year ago to $403 million.
Cash generated from operations fell 33.3% from $6.3 billion a year ago, though it stepped up from $1.1 billion in the first quarter and $3.4 billion in the second quarter. The company left its $5 billion share buyback authorization untouched again, using cash for debt reduction, dividends, and licensing deals.
Combined spending on research and development ($2.36 billion, down 3%) and selling, general and administrative overhead ($1.70 billion, down 5%) fell 3.7% from a year ago. Together, the two expense lines dropped to 31.1% of revenue from 34.5% a year ago by our math, helping cushion the drop in gross margin.
🔮 Guidance
Raised. The middle of the full-year sales range moved up $500 million to $50.0 billion, or 3.8% growth for the year by our math. After $37.53 billion in the first nine months, the plan leaves $12.47 billion for the fourth quarter by our math, a 0.3% decline from a year ago as European Eliquis patents expire in November. Second raise this year: +$0M, +$2,750M, +$500M.
Cut. Management lowered the middle of the full-year profit range by $0.425 per share to $6.45, reflecting $0.58 per share of third-quarter licensing charges (bringing the full-year charge impact to $0.60, up from $0.02). Excluding that $0.58 charge change, the operational midpoint rose by $0.155. By our math, the outlook leaves $1.48 per share for the fourth quarter, up 17.5% from a year ago.
Unchanged. The plan keeps full-year gross margin excluding one-offs at a 69.5% midpoint despite the third-quarter drop to 68.4%. Given a 70.0% gross margin across the first nine months, hitting the middle of the full-year range leaves fourth-quarter gross margin at 68.0% by our math, reflecting higher Eliquis profit-sharing.
Unchanged. The outlook holds combined selling, general and administrative and research spending at $16.5 billion for the year. After spending $12.06 billion across the first nine months, the plan leaves $4.44 billion for the fourth quarter by our math, up from $4.06 billion in the third quarter as the company funds new drug launches.
Raised. The company reduced its expected full-year net other expense by $50 million, citing favorable net interest as debt paydowns lowered borrowing costs and cash balances grew. Across the first nine months, net other expense excluding one-offs totaled $392 million, leaving about $258 million of net expense for the fourth quarter by our math.
Unchanged. The full-year tax rate plan remains at about 18%. Because the effective tax rate excluding one-offs was 14.1% in the third quarter and 16.4% across the first nine months, reaching an 18% full-year average implies a higher tax rate in the fourth quarter depending on where profits are earned.
Unchanged. Management kept its full-year Eliquis growth target at 20% to 25% over 2025's $14.44 billion. With Eliquis up 21% to $13.31 billion through nine months, the middle of the full-year range leaves fourth-quarter Eliquis sales at $4.39 billion by our math, up 27.0% from a year ago as US pricing gains offset November's European patent expiry.
Raised. On its presentation slides, Bristol Myers improved its expected full-year Legacy Portfolio decline by 1 percentage point to a 3% to 5% drop. Through nine months, the Legacy Portfolio is down 3% to $16.11 billion, so a 4% full-year drop leaves fourth-quarter Legacy sales at $4.80 billion by our math, down 6.1% from a year ago.
❓ Key Questions
How much did the contract termination hurt gross margin?
Gross margin excluding one-offs fell 4.5 percentage points to 68.4% on product mix and a one-time contract termination charge. Knowing the exact dollar size of the termination charge would show how much of the drop is recurring product-mix pressure.
Why did Admilparant miss at the higher 120mg dose?
In the Phase 3 lung-scarring trial, Admilparant met its primary goal at the 60mg dose, but the 120mg dose did not reach statistical significance. Doctors and regulators will look closely at why the higher dose underperformed the lower one.
Why did Cobenfy sales dip from the second quarter?
Cobenfy generated $57 million in the third quarter, down from $63 million in the second quarter, and the presentation noted prescriber education on dosing. Disclosing weekly prescription trends and the share of patients reaching the full dose would clarify demand.
When will Bristol Myers break out Zenbexus sales?
Following FDA approval in August, Zenbexus revenue sits inside the $731 million Other Growth Products line alongside six other drugs and royalties. Reporting Zenbexus on its own line would let investors track the commercial launch of the CELMoD platform.