ABBV
Abbvie INC
NYSE
8-K: AbbVie Updates 2024 Earnings Guidance to Include $164 Million IPR&D Expense
Sentiment:
Earnings Guidance Update
3 April 2024 4:06 PM
AbbVie has revised its 2024 earnings guidance to incorporate a $164 million expense related to acquired IPR&D and milestones, impacting both GAAP and adjusted non-GAAP diluted earnings per share.
Worse than expected
The company's earnings per share guidance has been lowered due to a $164 million expense related to acquired IPR&D and milestones.
Summary
- AbbVie has announced that its first quarter 2024 results will include a $164 million pre-tax expense for acquired IPR&D and milestones.
- This expense will negatively impact both GAAP and adjusted non-GAAP diluted earnings per share by $0.08.
- The company's full-year 2024 adjusted diluted earnings per share guidance, including this expense, is now $10.97 $11.17.
- The first quarter 2024 adjusted diluted earnings per share guidance, including the expense, is $2.18 $2.22.
- The company does not forecast future acquired IPR&D and milestone expenses due to the uncertainty of these transactions.
Sentiment
Score: 4
Explanation: The sentiment is slightly negative due to the downward revision of earnings guidance caused by the IPR&D expense. While these expenses are common, they still negatively impact the company's short-term financial outlook.
Negatives
- The $164 million IPR&D and milestones expense negatively impacts both GAAP and adjusted non-GAAP diluted earnings per share by $0.08.
- The full-year and first quarter adjusted diluted EPS guidance ranges have been lowered to reflect this expense.
Risks
- The final results for the quarter ended March 31, 2024, are not yet finalized and may differ from these preliminary estimates.
- Future acquired IPR&D and milestone expenses are uncertain and cannot be reliably forecasted, potentially impacting future earnings.
- The company faces risks related to intellectual property, competition, research and development, litigation, and regulatory changes.
Future Outlook
AbbVie's 2024 adjusted diluted EPS guidance excludes any impact from acquired IPR&D and milestones expense that may be incurred beyond the first quarter of 2024, as both cannot be reliably forecasted.
Management Comments
- AbbVie does not forecast acquired IPR&D and milestones expense due to uncertainty of the future occurrence and timing of these transactions.
- AbbVie undertakes no obligation to release publicly any revisions to forward-looking statements as a result of subsequent events or developments, except as required by law.
Industry Context
The pharmaceutical industry often sees fluctuations in earnings due to research and development expenses, particularly those related to acquisitions and licensing agreements. This announcement reflects the inherent uncertainty in these types of investments.
Comparison to Industry Standards
- Other large pharmaceutical companies such as Pfizer, Merck, and Johnson & Johnson also experience fluctuations in earnings due to IPR&D expenses.
- These expenses are common in the industry due to the high cost of drug development and acquisitions.
- The impact of $0.08 per share is within the range of what is typically seen for similar expenses in the sector.
- It is common for companies to not forecast these expenses due to their unpredictable nature.
Stakeholder Impact
- Shareholders will see a reduction in earnings per share due to the IPR&D expense.
- Analysts may adjust their financial models to reflect the updated guidance.
- The company's financial performance will be closely monitored in the coming quarters.
Key Dates
- April 3, 2024: Date of the 8-K filing and the earliest event reported.
- February 12, 2024: Date of the previously announced 2024 adjusted diluted earnings per share guidance.
- March 31, 2024: End of the first quarter for which results are being reported.
Keywords
IPR&D, milestones, earnings per share, EPS, financial guidance, AbbVie, pharmaceuticals, adjusted earnings
ABBV
Abbvie INC
NYSE
Sector: TBD
Filings with Classifications
Better than expected
9 May 2025 1:24 PM
Quarterly Report
- The company reported an 8% increase in net revenues on a reported basis and a 10% increase on a constant currency basis, indicating strong growth.
- Operating earnings reached $3.7 billion, with diluted earnings per share at $0.72, reflecting improved profitability.
- Key growth drivers included Skyrizi and Rinvoq in immunology, and Vraylar and Botox Therapeutic in neuroscience, demonstrating successful product performance.
Better than expected
25 April 2025 7:48 AM
Quarterly Report
- AbbVie's first-quarter results exceeded expectations, leading to an increase in the company's full-year adjusted diluted EPS guidance.
Worse than expected
3 April 2025 4:13 PM
8-K Filing
- The company's full-year adjusted diluted EPS guidance has been lowered from $12.12 $12.32 to $11.99 $12.19 due to the $248 million IPR&D expense in Q1 2025.
Better than expected
24 March 2025 4:28 PM
Proxy Statement
- AbbVie's 2024 results exceeded expectations with strong revenue growth and a robust R&D pipeline, indicating better-than-expected performance.
Capital raise
26 February 2025 5:04 PM
Debt Offering Announcement
- AbbVie completed an underwritten public offering of $4 billion in senior notes.
- The offering was registered under the Securities Act of 1933.
- The proceeds from the notes offering are likely to be used for general corporate purposes, including refinancing existing debt, funding acquisitions, and investing in research and development.
Capital raise
19 February 2025 9:22 AM
Debt Offering Announcement
- AbbVie is issuing $4 billion in senior notes.
- The offering includes notes due in 2028, 2030, 2035, and 2055.
- The company expects to receive approximately $3.98 billion in net proceeds.
Better than expected
18 February 2025 5:00 PM
SEC Form 4
- The vesting of performance-based awards suggests that the company exceeded its performance targets, leading to the release of these shares to the executive.
Worse than expected
14 February 2025 1:17 PM
Annual Report (Form 10-K)
- Humira sales declined by 37% globally due to biosimilar competition, which is worse than expected.
Delay expected
14 February 2025 1:17 PM
Annual Report (Form 10-K)
- AbbVie received a Complete Response Letter (CRL) from the FDA for the New Drug Application (NDA) for ABBV-951 for the treatment of motor fluctuations in adults with advanced Parkinson's disease.
Worse than expected
31 January 2025 7:42 AM
Quarterly Report
- The full-year diluted EPS decreased by 12.1% on a GAAP basis and 8.9% on an adjusted basis.
- The company experienced a diluted loss per share in the fourth quarter on a GAAP basis.
- The fourth-quarter results included a significant unfavorable impact from acquired IPR&D and milestones expense.
- The company recorded a non-cash after-tax intangible asset impairment charge of $3.5 billion related to emraclidine.
Worse than expected
10 January 2025 8:31 AM
8-K Filing
- The document details a $3.5 billion impairment charge due to failed clinical trials, indicating worse than expected results for the emraclidine program.
Worse than expected
6 January 2025 4:02 PM
Earnings Guidance Update
- The updated guidance includes a $1.6 billion charge for acquired IPR&D and milestones expense, which significantly reduces both Q4 and full-year adjusted diluted EPS compared to previous guidance.
Worse than expected
4 November 2024 2:19 PM
Quarterly Report
- The company's diluted earnings per share of $0.88 for the quarter and $2.41 for the nine months ended September 30, 2024 were negatively impacted by significant expenses related to amortization of intangible assets, changes in fair value of contingent consideration liabilities, acquisition and integration costs, and litigation matters.
- The company's operating cash flows decreased compared to the prior year due to the timing of working capital, higher contingent consideration payments and decreased results from operations driven by acquisition-related cash expenses.
Delay expected
4 November 2024 2:19 PM
Quarterly Report
- AbbVie received a Complete Response Letter from the FDA for the New Drug Application for ABBV-951 due to observations identified during inspection of a third-party manufacturer.
Better than expected
30 October 2024 7:43 AM
Quarterly Report
- The company raised its full-year adjusted diluted EPS guidance, indicating better than expected performance.
- The company's adjusted diluted EPS of $3.00 was better than the previous year's $2.95.
- The company's net revenues increased by 3.8 percent on a reported basis, indicating better than expected performance.
Worse than expected
3 October 2024 4:07 PM
Earnings Guidance Update
- The $82 million expense for acquired IPR&D and milestones will negatively impact both GAAP and adjusted non-GAAP diluted earnings per share by $0.04.
- The full-year and third quarter adjusted diluted EPS guidance ranges have been lowered to reflect this expense.
Delay expected
7 August 2024 3:00 PM
Quarterly Report
- AbbVie received a Complete Response Letter from the FDA for ABBV-951 due to observations identified during inspection of a third-party manufacturer, delaying the potential approval of the drug.
Worse than expected
7 August 2024 3:00 PM
Quarterly Report
- The company's earnings per share were negatively impacted by acquisition-related costs and amortization of intangible assets.
- Humira sales declined significantly due to biosimilar competition, which was worse than expected.
- Operating cash flows decreased compared to the prior year due to working capital timing and acquisition-related expenses.
Capital raise
7 August 2024 3:00 PM
Quarterly Report
- AbbVie issued $15 billion in senior notes to finance the acquisitions of ImmunoGen and Cerevel Therapeutics.
- The company also borrowed and repaid $5.0 billion under a term loan credit agreement in connection with these acquisitions.
Better than expected
25 July 2024 7:41 AM
Quarterly Report
- The company's second-quarter results exceeded expectations, driven by strong performance in its ex-Humira portfolio.
- AbbVie raised its full-year adjusted diluted EPS guidance, indicating better than previously anticipated financial performance.
Delay expected
25 July 2024 7:41 AM
Quarterly Report
- AbbVie received a Complete Response Letter (CRL) from the FDA for the New Drug Application (NDA) for ABBV-951, citing observations identified during inspection of a third-party manufacturer, which will delay the launch of the product.
Worse than expected
3 July 2024 2:07 PM
Earnings Guidance Update
- The company's earnings guidance for both the full year and the second quarter has been lowered due to a significant $937 million IPR&D expense.
Better than expected
3 May 2024 11:04 AM
Quarterly Report
- The diluted earnings per share significantly increased to $0.77 from $0.13 year-over-year, indicating better than expected profitability.
- Net earnings attributable to AbbVie Inc. were $1.369 billion, a substantial increase from $239 million in the first quarter of 2023, showing better than expected results.
Capital raise
3 May 2024 11:04 AM
Quarterly Report
- AbbVie issued $15 billion in senior notes to finance the acquisition of ImmunoGen and the proposed acquisition of Cerevel Therapeutics.
- The company borrowed and repaid $5.0 billion under a term loan credit agreement in February 2024.
Delay expected
3 May 2024 11:04 AM
Quarterly Report
- The company made a decision to revise the research and development plan for AGN-151607, a novel investigational neurotoxin, which contributed to a delay in the estimated timing of regulatory approval.
Better than expected
26 April 2024 7:43 AM
Quarterly Report
- The company raised its full-year adjusted diluted EPS guidance, indicating better than expected future performance.
- First quarter results were well ahead of expectations, driven by excellent performance from the ex-Humira growth platform.
Worse than expected
3 April 2024 4:06 PM
Earnings Guidance Update
- The company's earnings per share guidance has been lowered due to a $164 million expense related to acquired IPR&D and milestones.
Capital raise
26 February 2024 5:08 PM
Debt Offering Announcement
- AbbVie is raising $15 billion through the issuance of senior notes.
- The notes are being sold to underwriters in a registered public offering.
- The proceeds will be used for specific purposes including acquisitions and debt repayment.
Worse than expected
12 February 2024 7:49 AM
Merger Announcement
- The acquisition is expected to be dilutive to AbbVie's EPS in 2024, with a $0.42 per share impact for the full year and $0.04 per share in the first quarter.
Worse than expected
2 February 2024 7:51 AM
Quarterly Report
- The full-year GAAP diluted EPS decreased by 59.0%, indicating worse than expected profitability.
- The overall net revenues decreased by 6.4% on a reported basis, showing worse than expected sales performance.
- Humira revenues experienced a substantial decline due to biosimilar competition, which was worse than expected.
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