Q3 2025 Zoetis Inc Earnings Call

November 4, 2025

Hosting the call today is Steve Frank Vice President of Investor Relations for Zoe edits the presentation materials and additional financial tables are currently posted on the Investor Relations section of the wettest dotcom. The presentation slides can be managed by you the viewer and will not be forwarded automatically. In addition, a replay of this call.

All will be available approximately two hours after the conclusion of this call via dial in or on the Investor Relations section of <unk> Dot com at this time, all participants have been placed in a listen only mode and the floor will be opened for your questions. Following the presentation.

We would like to ask a question at that time. Please press star one on your telephone keypad. If at any point. Your question has been answered you may remove yourself from the queue by pressing star too in the interest of time, we ask that you. Please limit yourself to one question and then queue up again with any follow ups. Your line will be muted when you complete your question again.

Posing your question. Please pick up your handset to allow optimal sound quality I'll now turn the call over to Mr. Steve Frank. Please go ahead Sir.

Thank you operator.

Everyone and welcome to the <unk> third quarter 2025 earnings call I'm joined today by Kristin Peck, our Chief Executive Officer, and Whitney Joseph Our Chief Financial Officer before we begin I'll remind you that the slides presented on this call are available on the Investor Relations section of our website and that our remarks today will include forward looking statements.

And that actual results could differ materially from those projections for a list and description of certain factors that could cause results to differ.

For you to the forward looking statements in today's press release, and our SEC filings, including but not limited to our annual report on Form 10-K, and our reports on Form 10-Q.

Our remarks today will also include references to certain financial measures, which were not prepared in accordance with generally accepted accounting principles or U S. GAAP.

Reconciliation of these non-GAAP financial measures to the most directly comparable U S. GAAP measures is included in the financial tables that accompany our earnings press release.

The company's 8-K filing data today Tuesday November 4th 2025, we also cite operational results, which exclude the impact of foreign exchange with that I will turn the call over to Kristin.

E E and welcome everyone to our third quarter earnings call today, we reported 4% revenue growth and 9% growth in adjusted net income on an organic operational basis. Thanks to the relentless focus and consistent execution of our colleagues across the world.

Our international segment delivered 6% organic operational revenue growth with the U S contributed 3% growth excluding the impact of the MFA divestiture by species companion animal revenue grew 2% operationally and livestock organic.

Operational revenue grew 10% as we anticipated growth moderated this quarter driven by our strong year over year comp and macro factors, including that clinic visits and promotional activity.

Resilient growth engine remains strong fueled by our market, leading innovation and pipeline of diversified portfolio across species and geographies global reach and trusted brands that continue to lead their categories and remain essential to veterinarians. Despite some near term headwinds.

Operator: Financial results conference call and webcast for Zoetis. Hosting the call today is Steve Frank, Vice President of Investor Relations for Zoetis. The presentation materials and additional financial tables are currently posted on the Investor Relations section of zoetis.com. The presentation slides can be managed by you, the viewer, and will not be forwarded automatically. In addition, a replay of this call will be available approximately two hours after the conclusion of this call via dial-in or on the Investor Relations section of zoetis.com. At this time, all participants have been placed in a listen-only mode, and the floor will be open for your questions following the presentation. If you would like to ask a question at that time, please press star one on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing star two.

Now, let's turn to our key franchises, where we're continuing to drive growth and the market opportunities remain significant.

And Parasiticide art comparator franchise grew 7% operationally with 6% operational growth Crimson Parikh of trio.

Internationally, we delivered strong broad based double digit growth driven largely by the continued strength of trio across all regions underscoring the strong and growing global demand and trios. Most recent approval in Brazil further extend to that momentum. Another example of.

Power innovation and geographical expansion continue to fuel the franchise's long term growth.

In the U S. While broader end market dynamics affected overall franchise performance, we continue to see solid growth in retail and home delivery channels, which drive compliance and convenience or pet owners.

Operator: In the interest of time, we ask that you please limit yourself to one question and then queue up again with any follow-ups. Your line will be muted when you complete your question. Again, when posing your question, please pick up your handset to allow optimal sound quality. I'll now turn the call over to Mr. Steve Frank. Please go ahead, sir.

Trio growth moderated against a strong prior year comp with continued strength in the alternative channels, helping to partially offset subdued clinic traffic. We continue to navigate a more competitive U S market and hold share with discipline and focused execution.

Steve Frank: Thank you, Operator. Good morning, everyone, and welcome to the Zoetis third quarter 2025 earnings call. I am joined today by Kristin Peck, our Chief Executive Officer, and Wetteny Joseph, our Chief Financial Officer. Before we begin, I'll remind you that the slides presented on this call are available on the Investor Relations section of our website, and that our remarks today will include forward-looking statements, and that actual results could differ materially from those projections. For a list and description of certain factors that could cause results to differ, I refer you to the forward-looking statements in today's press release and our SEC filings, including but not limited to our annual report on Form 10-K, and our reports on Form 10-Q. Our remarks today will also include references to certain financial measures which were not prepared in accordance with generally accepted accounting principles or US GAAP.

Organic operational revenue growth with the U S contributed 3% growth excluding the impact of the MFA divestiture by species companion animal revenue grew 2% operationally and livestock organic operational revenue grew 10% as we anticipated growth moderated this quarter.

Trio continues to set the benchmark in the category supported by the broader strength of this imperative franchise, our first mover advantage strong retail presence and customer loyalty position us well for sustained momentum across the portfolio.

<unk> driven by our strong year over year comp and macro factors, including that clinic visits and promotional activity.

Parasiticide remained the largest category in animal health and as the clear leader, we are competing from a position of strength with best in class innovation and high adoption driving long term growth.

A resilient growth engine remains strong fueled by our market, leading innovation and pipeline of diversified portfolio across species and geographies global reach and trusted brands that continue to lead their categories and remain essential to veterinarians. Despite some near term headwinds.

Our key dermatology franchise grew 3% operationally in the quarter, reflecting the resilience of our differentiated and innovative portfolio.

In the U S growth was driven by apical chewable adoption and strong retail performance offset by clinic softness and competitive dynamics in the category internationally dermatology grew despite heightened competitive dynamics, including aggressive promotional activity tied to new product launches.

Steve Frank: The reconciliation of these non-GAAP financial measures to the most directly comparable US GAAP measures is included in the financial tables that accompany our earnings press release and the company's 8-K filing dated today, Tuesday, 4 November 2025. We also cite operational results which exclude the impact of foreign exchange. With that, I will turn the call over to Kristin.

Now, let's turn to our key franchises, where we're continuing to drive growth and the market opportunities remain significant.

And parasiticide, our comparator franchise grew 7% operationally with 6% operational growth from some parikh of trio.

At the same time, we continued to expand our differentiated portfolio with apical chewable approved in Chile, and say to point, receiving an expanded label in Brazil for allergic edge again, reflecting our approach to geographic expansion and lifecycle innovation that supports sustained category growth.

Kristin Peck: Thank you, Steve, and welcome everyone to our third quarter earnings call. Today, we reported 4% revenue growth and 9% growth in adjusted net income on an organic operational basis, thanks to the relentless focus and consistent execution of our colleagues across the world. Our international segment delivered 6% organic operational revenue growth, with the US contributing 3% growth, excluding the impact of the MFA divestiture. By species, companion animal revenue grew 2% operationally, and livestock organic operational revenue grew 10%. As we anticipated, growth moderated this quarter, driven by a strong year-over-year comp and macro factors, including vet clinic visits and promotional activity. Our resilient growth engine remains strong, fueled by our market-leading innovation and pipeline, a diversified portfolio across species and geographies, global reach, and trusted brands that continue to lead their categories and remain essential to veterinarians despite some near-term headwinds.

As expected we saw some minor share shifts during the launch period. However, we're confident our portfolio will maintain its position as the preferred choice among customers.

Our innovation and geographical expansion continue to fuel the franchise's long term growth in.

Even with this competitive backdrop, the overall opportunity in dermatology aimed significant more than half a curated cases globally remain untreated and we see substantial runway for continued growth and market expansion.

In the quarter, our osteoarthritis or OA pain franchise declined 11% operationally in addition to impact in the U S. Our performance in primarily English speaking international markets has also been affected by misperceptions amplified on social media contributing to a 15% operational decline.

<unk> continues to set the benchmark in the category.

Courted by the broader strength of this imperative franchise, our first mover advantage strong retail presence and customer loyalty position us well to sustain momentum across the portfolio.

<unk> and global umbrella fails.

Kristin Peck: Now, let's turn to our key franchises, where we're continuing to drive growth and the market opportunities remain significant. In parasiticides, our Simparica franchise grew 7% operationally, with 6% operational growth from Simparica Trio. Internationally, we delivered strong, broad-based double-digit growth, driven largely by the continued strength of Trio across all regions, underscoring the strong and growing global demand. Trio's most recent approval in Brazil further extends that momentum, another example of how our innovation and geographical expansion continue to fuel the franchise's long-term growth. In the US, while broader end market dynamics affected overall franchise performance, we continue to see solid growth in retail and home delivery channels, which drive compliance and convenience for pet owners. Trio growth moderated against a strong prior-year comp, with continued strength in the alternative channels, helping to partially offset subdued clinic traffic.

We are executing a focused multi pronged strategy to return liberal it to grow.

First we're increasing awareness it away is a serious progressive disease, requiring early and proactive care to control associated pain and improve our pets quality of life.

Our key dermatology franchise grew 3% operationally in the quarter, reflecting the resilience of our differentiated and innovative portfolio.

We're deepening education and engagement with specialists and veterinarian to reinforce labella positive risk benefit profile and real world impact.

Third we're continuing to share clear science based information and amplify the overwhelmingly positive experiences people and pets are having.

Finally, beginning in Q4, our phase four research conducted through independent third party studies aimed to provide that and specialists with even greater confidence in labella.

At the same time, we continued to expand our differentiated portfolio with apical chewable approved in Chile, and say to point received an expanded label in Brazil for allergic edge again, reflecting our approach to geographic expansion and lifecycle innovation that supports sustained category growth.

We are encouraged by recent trends showing signs of stabilization supported by strong satisfaction. Among the majority of pet owners, giving us confidence in the actions, we're taking to support recovery and in how we're applying those learnings to future launches.

Kristin Peck: We continue to navigate a more competitive US market and hold share with discipline and focused execution. Trio continues to set the benchmark in the category, supported by the broader strength of the Simparica franchise. Our first-mover advantage, strong retail presence, and customer loyalty position us well to sustain momentum across the portfolio. Parasiticides remain the largest category in animal health, and as the clear leader, we are competing from a position of strength, with best-in-class innovation and high adoption driving long-term growth. Our key dermatology franchise grew 3% operationally in the quarter, reflecting the resilience of our differentiated and innovative portfolio. In the US, growth was driven by Apoquel chewable adoption and strong retail performance, offset by clinic softness and competitive dynamics in the category. Internationally, dermatology grew despite heightened competitive dynamics, including aggressive promotional activity tied to new product launches.

As expected we saw some minor share shifts during these loss periods. However, we're confident our portfolio will maintain its position as the preferred choice among customers.

To that end, we are excited about the first market approval of Lin Nivea I distinct long acting molecule for dog that offers greater choice and flexibility for veterinarians and pet owners.

Even with this competitive backdrop, the overall opportunity in dermatology and significant.

In Canada with a lot of expected there in the first half of 2026.

<unk> also received a positive C D M P opinion recommending marketing authorization in Europe.

More than half of purity cases globally remain untreated and we see substantial runway for continued growth and market expansion.

In addition to that we received European approval or per kilo or long acting monoclonal antibody for feline OA pain with a launch also expected in the first half of 2026 further extending our leadership in chronic pain management across species.

In the quarter, our osteoarthritis or OA pain franchise declined 11% operationally in addition to impacts in the U S. Our performance in primarily English speaking international markets has also been affected by misperceptions amplified on social media contributing to a 15% operational decline.

These milestones highlight the durable strength of our innovation engine and our ability to advance our deep pipeline from approvals through launch and we anticipate a major new market approval each year for the next several years.

In global umbrella fails.

We are executing a focused multi pronged strategy to return liberal it to grow.

First we're increasing awareness it away is a serious progressive disease, requiring early and proactive care to control associated pain and improve our pets quality of life.

Together, Loretta Lynn Nivea, Valencia, and portela for them, a next generation OA pain portfolio unmatched in its depth and scientific innovation offering flexibility, reaching a broader patient population and reinforcing the long term growth trajectory of this important and.

Kristin Peck: At the same time, we continue to expand our differentiated portfolio, with Apoquel chewable approved in Chile and Cytopoint receiving an expanded label in Brazil for allergic itch, again reflecting our approach to geographic expansion and lifecycle innovation that supports sustained category growth. As expected, we saw some minor share shifts during these launch periods. However, we're confident our portfolio will maintain its position as a preferred choice among customers. Even with this competitive backdrop, the overall opportunity in dermatology remains significant. More than half of curated cases globally remain untreated, and we see substantial runway for continued growth and market expansion. In the quarter, our osteoarthritis or OA pain franchise declined 11% operationally. In addition to impacts in the US, our performance in primarily English-speaking international markets has also been affected by misperceptions amplified on social media, contributing to a 15% operational decline in global Librela sales.

Second, we're deepening education and engagement with specialists and veterinarians to reinforce labella positive risk benefit profile and real world impact.

Under penetrated market.

To enable growth in this expanding portfolio, we're continuing to invest in manufacturing excellence, including our new Atlanta advanced Biologics facility and expanded monocle antibody production capability, ensuring that every innovation, we bring to market, which is veterinarians and pet owners with a quad.

Third we're continuing to share clear science based information and amplify the overwhelmingly positive experiences people and pets are having.

Finally, beginning in Q4, our phase four research conducted through independent third party studies aimed to provide that's and specialists with even greater confidence in labella.

Liability in scale, they expect forms of lettuce.

Beyond our product portfolio, we're evolving our U S commercial structure to better serve customers and enhance our agility and efficiency building on the strength of our key companion animal franchises and the critical role in veterinary practices as.

As the U S pet market expands expectations for more personalized convenient and enhanced care continue to rise to better meet those needs. We're implementing our go to market model. It sharpens, our focus and simplify our structure. The result will be a leaner more agile field organization with single.

To that end, we are excited about the first market approval of Lin nivea distinct long acting molecule for dogs that offers greater choice and flexibility for veterinarians and pet owners in Canada with a launch expected there in the first half of 2026. We also received a positive C. D M D.

Kristin Peck: We are executing a focused, multi-pronged strategy to return Librela to growth. First, we're increasing awareness that OA is a serious, progressive disease requiring early and proactive care to control associated pain and improve a pet's quality of life. Second, we're deepening education and engagement with specialists and veterinarians to reinforce Librela's positive risk-benefit profile and real-world impact. Third, we're continuing to share clear, science-based information and amplify the overwhelmingly positive experiences people and pets are having. Finally, beginning in Q4, our phase four research conducted through independent third-party studies aims to provide vets and specialists with even greater confidence in Librela. We are encouraged by recent trends showing signs of stabilization supported by strong satisfaction among the majority of pet owners, giving us confidence in the actions we're taking to support recovery and in how we're applying those learnings to future launches.

Our contact coverage, expanding our reach and frequency and deepening engagement with our customers. We expect this model will support growth and bolster our competitive positioning and we will continue evaluating opportunities for similar enhancements across the business into 2026, ensuring we continue delivering the.

Recommending marketing authorization in Europe.

In addition to that we received European approval or per tower or long acting monoclonal antibody for feline OA pain with a launch also expected in the first half of 2026 further extending our leadership in chronic pain management across species.

Best experience for our customers and the strongest value for shareholders. We look forward to sharing updates on our progress.

These milestones highlight the durable strength of our innovation engine and our ability to advance a deep pipelines from approvals through launch and we anticipate a major new market approval each year for the next several years.

In livestock organic operational revenue grew 10% in the quarter, reflecting broad based growth across geographies and species and we're on track for a third consecutive year of above market growth in 2025 supported by strong execution and resilient market demand.

Together, Loretta Lynn Nivea, Celestia and portela for them, a next generation OA pain portfolio unmatched in its depth and scientific innovation offering flexibility, reaching a broader patient population and reinforcing the long term growth trajectory of this important and <unk>.

As an example, poultry continues to benefit from focused and vaccine led growth following in the MFA divestiture with deeper penetration among key accounts market expansion and growing adoption of <unk> across multiple regions.

You're penetrated market too.

To enable growth in this expanding portfolio, we're continuing to invest in manufacturing excellence, including our new Atlanta advanced Biologics facility and expanded monocle antibody production capabilities, ensuring that every innovation, we bring to market, which is veterinarians and pet owners with a quiet.

This progress reflects the strength of our strategy advancing innovation strengthening partnerships and ensuring our portfolio meets the evolving needs of producers worldwide.

Kristin Peck: To that end, we are excited about the first market approval of Linivia, a distinct, long-acting molecule for dogs that offers greater choice and flexibility for veterinarians and pet owners. In Canada, it was a launch expected there in H1 2026. We also received a positive CVMP opinion recommending marketing authorization in Europe. In addition to that, we received European approval for Portela, our long-acting monoclonal antibody for feline OA pain, with a launch also expected in H1 2026, further extending our leadership in chronic pain management across species. These milestones highlight the durable strength of our innovation engine and our ability to advance a deep pipeline, from approvals through launch, and we anticipate a major new market approval each year for the next several years.

I think protein consumption and the growing role of fish in the global food supply continue to reinforce the long term fundamentals of this business and.

Viability and scale they expect from go at it.

And beyond strong performance, we continued to live our purpose through innovation demonstrated by the speed and effectiveness of our response to emerging zoonotic diseases, including recent approvals related to H P AI and new world screw them.

As the U S pet market expands expectations for more personalized convenient and enhanced care continue to rise.

Turning to guidance, we are updating our full year outlook based on our year to date performance and expectations for the remainder of the year for organic operational revenue revising and narrowing our range to five five to $6 five giving them more measured view of the macro and operational environment in the back half of the year. We're also narrowing our.

To better meet those needs, we're implementing our go to market model, that's sharpens, our focus and simplify our structure. The result will be a leaner more agile field organization with single point of contact coverage, expanding our reach and frequency and deepening engagement with our customers. We expect this model with.

Organic operational adjusted net income growth range to 5.5% to 7% supported by continued cost discipline with a balanced approach to investment that enables us to sustain strong profitability and deliver shareholder value even amid near term variability.

Kristin Peck: Together, Librela, Linivia, Solensia, and Portela form a next-generation OA pain portfolio unmatched in its depth and scientific innovation, offering flexibility, reaching a broader patient population, and reinforcing the long-term growth trajectory of this important and under-penetrated market. To enable growth in this expanding portfolio, we're continuing to invest in manufacturing excellence, including our new Atlanta Advanced Biologics facility and expanded monoclonal antibody production capabilities, ensuring that every innovation we bring to market reaches veterinarians and pet owners with the quality and scale they expect from Zoetis. Beyond our product portfolio, we're evolving our US commercial structure to better serve customers and enhance our agility and efficiency, building on the strength of our key companion animal franchises and the critical role in veterinary practices. As the US pet market expands, expectations for more personalized, convenient, and enhanced care continue to rise.

Support growth and bolster our competitive positioning and we will continue evaluating opportunities for similar enhancements across the business into 2026, ensuring we continue delivering the best experience for our customers and the strongest value for shareholders. We look forward to sharing updates on our progress.

Overall, we have the right portfolio, the right strategy and deep connections with customers and pet owners positioning us not only to navigate the current environment, but to capture the significant opportunities ahead.

In livestock organic operational revenue grew 10% in the quarter, reflecting broad based growth across geographies and species and we're on track breath third consecutive year of above market growth in 2025 supported by strong execution and resilient market demand.

And we're delivering on the commitments we've made since outlining our innovation timeline in January we executed on or ahead of schedule. We are continuing to differentiate our portfolio with more than 130 geographic expansion and lifecycle innovations. This year several of which you can see in today's slides.

As an example, poultry continues to benefit from focused in vaccine led growth following in the MFA divestiture with deeper penetration among key accounts market expansion and growing adoption of <unk> across multiple regions.

Our ability to deliver on our commitments continues to define the wettest and position us to create significant value for shareholders is how do we build trust year after year with customers colleagues and investors alike. We are confident that the weather had the most robust comprehensive pipeline in animal health.

This progress reflects the strength of our strategy advancing innovation strengthening partnerships and ensuring our portfolio meets the evolving needs of producers worldwide.

Kristin Peck: To better meet those needs, we're implementing a go-to-market model that sharpens our focus and simplifies our structure. The result will be a leaner, more agile field organization with single point of contact coverage, expanding our reach and frequency, and deepening engagement with our customers. We expect this model will support growth and bolster our competitive positioning, and we will continue evaluating opportunities for similar enhancements across the business into 2026, ensuring we continue delivering the best experience for customers and the strongest value for shareholders. We look forward to sharing updates on our progress. In livestock, organic operational revenue grew 10% in the quarter, reflecting broad-based growth across geographies and species, and we're on track for a third consecutive year of above-market growth in 2025, supported by strong execution and resilient market demand.

I think protein consumption and the growing role of fish in the global food supply continue to reinforce the long term fundamentals of this business.

Advancing care across every category and stage powered by innovation and purpose, we're shaping the future of animal health and creating entirely new categories of care.

And with that in mind, as we announced yesterday, Rob Poser, our head of R&D will retire following a 10 year distinguished career at the wettest advancing our innovative pipeline, we are grateful for Ross incredible contribution Rob.

Rob will remain in his role until the end of the year and following his retirement at the end of February will be available to the west as a scientific advisor until the end of 2026, ensuring a smooth transition and continued momentum for the wettest as pipeline.

We are excited to appoint Kevin Nash as Rob successor effective January one Kevin has held a series of influential role in our R&D organization over the last decade and is ready to step in and lead the wettest as R&D into the future.

Kristin Peck: As an example, poultry continues to benefit from focus and vaccine-led growth following the MFA divestiture, with deeper penetration among key accounts, market expansion, and growing adoption of Procerta across multiple regions. This progress reflects the strength of our strategy, advancing innovation, strengthening partnerships, and ensuring our portfolio meets the evolving needs of producers worldwide. Rising protein consumption and the growing role of fish in the global food supply continue to reinforce the long-term fundamentals of this business. Beyond strong performance, we continue to live our purpose through innovation, demonstrated by the speed and effectiveness of our response to emerging zoonotic diseases, including recent approvals related to HPAI and new-world screw worm. Turning to guidance, we're updating our full-year outlook based on our year-to-date performance and expectations for the remainder of the year.

Seven has demonstrated a lifelong commitment to advancing animal health before joining the wettest Kevin was a practicing veterinarian and practice owner for more than 10 years and has a strong scientific background with formal training in public health immuno biology and pathology.

I hope you'll join us on Tuesday December 2nd at 830, a M. Eastern time for innovation webcast. When we will provide investors with the latest pipeline updates and the progress we're making to move the industry forward with a resilient business and unmatched pipeline and significant market potential we remain comes.

And we're delivering on the commitments we've made since outlining our innovation timeline in January we've executed on or ahead of schedule. We are continuing to differentiate our portfolio with more than 130 geographic expansion and lifecycle innovations. This year several of which you can see in today's slides.

And so what is the long term growth trajectory and with that I will turn it over to Whitney.

Thank you Kristen and Hello, everyone.

I'll provide some additional insights into our third quarter results.

We posted $2 $4 billion in revenue in the third quarter more than 1% on a reported basis and 4% organic operational basis.

Advancing care across every category and stage powered by innovation and purpose, we're shaping the future of animal health and creating entirely new categories of care.

Primarily driven by price as volume was flat in the quarter.

Kristin Peck: For organic operational revenue, we're revising and narrowing our range to 5.5% to 6.5%, giving a more measured view of the macro and operational environment in the back half of the year. We're also narrowing our organic operational adjusted net income growth range to 5.5% to 7%, supported by continued cost discipline with a balanced approach to investment that enables us to sustain strong profitability and deliver shareholder value even amid near-term variability. Overall, we have the right portfolio, the right strategy, and deep connections with customers and pet owners, positioning us not only to navigate the current environment but to capture the significant opportunities ahead. We're delivering on the commitments we've made. Since outlining our innovation timeline in January, we've executed on or ahead of schedule.

That's correct and noted we anticipated that growth would moderate as we entered the second half of the year.

Adjusted net income of $754 million grew 5% on a reported basis and 9% on an organic operational basis.

And with that in mind, as we announced yesterday, Rob holder, our head of R&D will retire following a 10 year distinguished career at the wettest advancing our innovative pipeline. We are grateful for Ross incredible contributions Rob will remain in his role until the end of the year and following his retirement at the end of February.

Our global companion animal portfolio posted revenue of $1 $7 billion growing 2% operationally in the quarter.

On an operational basis, or some burger franchise contributed $356 million growing 7% and keep their mythology books at $469 million growing 3%.

He will be available to the west as a scientific advisor until the end of 2026, ensuring a smooth transition and continued momentum Brazil wettest this pipeline.

This growth was partially offset by our order opinion franchise, which declined 11% operationally to $138 million.

We're excited to a point.

Okay.

The January one.

Kevin.

Our R&D organization.

Our global lifestyle portfolio with 10% on an organic operational basis in the quarter contributing $725 million in revenue with strong balanced performance across segments and species.

Right.

Kristin Peck: We are continuing to differentiate our portfolio with more than 130 geographic expansions and lifecycle innovations this year, several of which you can see in today's slides. Our ability to deliver on our commitments continues to define Zoetis and position us to create significant value for shareholders. It's how we build trust year after year with customers, colleagues, and investors alike. We are confident that Zoetis has the most robust, comprehensive pipeline in animal health, advancing care across every category and stage. Powered by innovation and purpose, we're shaping the future of animal health and creating entirely new categories of care. With that in mind, as we announced yesterday, Rob Holzer, our head of R&D, will retire following a 10-year distinguished career at Zoetis, advancing our innovative pipeline. We are grateful for Rob's incredible contributions.

He used the word as R&D into the future.

Kevin has devastated.

Good.

Helpful.

Do any of them.

Again. These results reflect the continued resilience of our business following last year's strong comparisons and they reaffirmed the solid fundamentals driving our growth.

The doctor practices.

For more than 10 years.

It has a strong scientific background.

Okay.

Allergy and pathology.

Even amid near term challenges.

He'll join us on Tuesday December 2nd at 830, a M. Eastern time for innovation webcast. When we will provide investors with the latest pipeline updates and the progress we're making to move the industry board with a resilient business and unmatched pipeline and significant market potential we remain company.

Stress market leading innovation.

Diversified global portfolio and trusted brands continues to position us well for future growth and market expansion.

Now moving onto our Q3 segment results.

As expected growth moderated in the U S. As we enter the second half of the year with revenue down 2% on a reported basis and up 3% organic operational basis.

So what is the long term growth trajectory and with that I will turn it over to Whitney.

Thank you Kristen and Hello, everyone. Let me now provide some additional insights into our third quarter results.

Companion animal was flat and lifestyle grew 14% organic operational basis.

We posted $2 $4 billion in revenue in the third quarter, one, 1% on a reported basis and 4% organic operational basis.

This moderation primarily reflected a strong comparable period and companion animal, particularly in derm and parasiticide.

Kristin Peck: Rob will remain in his role until the end of the year, and following his retirement at the end of February, he will be available to Zoetis as a scientific advisor until the end of 2026, ensuring a smooth transition and continued momentum for Zoetis's pipeline. We are excited to appoint Kevin Esch as Rob's successor, effective January 1. Kevin has held a series of influential roles in our R&D organization over the last decade and is ready to step in and lead Zoetis's R&D into the future. Kevin has demonstrated a lifelong commitment to advancing animal health. Before joining Zoetis, Kevin was a practicing veterinarian and practice owner for more than 10 years and has a strong scientific background with formal training in public health, immunobiology, and pathology.

And the vet channel we continue to believe clinic revenue is more impactful for growth than overall visits.

It was primarily driven by price as volume was flat in the quarter.

As Christian noted, we anticipated that growth would moderate as we entered the second half of the year.

That said, we saw a decline in visits across all major therapeutic areas during the third quarter, which impacted new patient starts.

Adjusted net income of $754 million grew 5% on a reported basis and 9% on an organic operational basis.

Meanwhile, the distributor inventory dynamics, we discussed earlier in the quarter normalized by quarter end.

And near the low end of Orange.

Our global companion animal portfolio posted revenue of $1 $7 billion growing 2% operationally in the quarter.

Our companion animal business was flat in the quarter with growth in North America into the mythology franchises offset by declines in our opinion labs.

On an operational basis, or some burger franchise contributed $356 million growing 7% and keep their mythology posted $469 million growing 3%.

Or some Burger franchise grew 2% in the quarter to $263 million in revenue.

Our plan is built off of a strong comparable period in the prior year, where we saw 27% operational growth driven by more disciplined approach to our promotional strategy.

This growth was partially offset by our order opinion franchise, which declined 11% operationally to $138 million.

Kristin Peck: I hope you'll join us on Tuesday, 02 December, at 8:30AM Eastern Time for an innovation webcast, where we will provide investors with the latest pipeline updates and the progress we're making to move the industry forward. With a resilient business, an unmatched pipeline, and significant market potential, we remain confident in Zoetis's long-term growth trajectory. With that, I will turn it over to Wetteny. Thank you, Kristin. Hello, everyone. Let me now provide some additional insights into our third-quarter results. We posted $2.4 billion in revenue in the third quarter, growing 1% on a reported basis and 4% on an organic operational basis. This was primarily driven by price, as volume was flat in the quarter. As Kristin noted, we anticipated that growth would moderate as we entered the second half of the year.

Growth in alternative channels continues fueled by pet owner preference and higher compliance.

Our global lifestyle portfolio with 10% on an organic operational basis in the quarter contributing $725 million in revenue with strong balanced performance across segments and species.

It helps sustain supercuts real momentum despite continued softness in the U S vet channel.

As the leader in Triple combination parasiticide, the fastest growing seven in animal health. So burger through is well positioned for continued growth driven by our first mover advantage blood label and strong market presence.

Again. These results reflect the continued resilience of our business following last year's strong comparisons and they reaffirmed the solid fundamentals driving our growth.

Even amid near term challenges of course stress market leading innovation.

Two dermatology sales grew 1% to $306 million with growth in evergreen being partially offset by declines in photo point due to lower them apology clinic visits.

A diversified global portfolio and trusted brands continues to position us well for future growth and market expansion.

Our growth in the quarter, primarily reflects the impact of initial distributor stocking of a couple of cool film coated tablet, which was made available to distribution in September.

Now moving onto our Q3 segment results.

As expected growth moderated in the U S. As we enter the second half of the year with revenue down 2% on a reported basis and up 3% organic operational basis.

In addition to a strong comparable period in the prior year, we saw modest share loss in the U S. Derm space, primarily driven by competitive discounting and simply related to new product launches.

Kristin Peck: Adjusted net income of $754 million, with 5% on a reported basis and 9% on an organic operational basis. Our global companion animal portfolio posted revenue of $1.7 billion, growing 2% operationally in the quarter. On an operational basis, our Simparica franchise contributed $356 million, growing 7%, and key dermatology posted $469 million, growing 3%. This growth was partially offset by our OA pain franchise, which declined 11% operationally to $138 million. Our global livestock portfolio grew 10% on an organic operational basis in the quarter, contributing $725 million in revenue, with strong balanced performance across segments and species. Again, these results reflect the continued resilience of our business following last year's strong comparison, and they reaffirm the solid fundamentals driving our growth. Even amid near-term challenges, our core strengths, market-leading innovation, a diversified global portfolio, and trusted brands continue to position us well for future growth and market expansion.

Companion animal was flat and lifestyle grew 14% organic operational basis.

Based on our experience. These impacts are typically short lived and we remain confident in the value of our dermatology portfolio provides the vets and pet owners that are pricing along with the quality and outcomes we deliver.

This moderation primarily reflected a strong comparable period and companion animal, but theyre, calling in derm and parasiticide.

And the vet channel we continue to believe clinic revenue is more impactful for growth than overall visits.

We are well positioned to grow and expand the dermatology market is moving forward anchored by our three differentiated brands with a proven track record of safety and efficacy and an estimated 11 million medicalized dogs, they remain untreated or under treated for each in the U S alone.

That said, we saw decline in visits across all major therapeutic areas during the third quarter, which impacted new patient starts.

Meanwhile, the distributor inventory dynamics, we discussed earlier in the quarter normalized by quarter end and remained near the low end of historical range.

Oh at pain products saw a decline of 21% in the U S and $58 million in sales.

The U S companion animal business was flat in the quarter with growth in North America. Thank you dermatology franchises offset by declines in our oil paint labs.

The brand posted $41 million in revenue for the quarter, a decline of 26% versus Q3 of last year.

Awesome Burger franchise grew 2% in the quarter to $263 million in revenue.

Christa highlighted our multi pronged strategy to returning to.

The growth and we are confident that the actions we are taking will help reaccelerate adoption.

Our plan is built off of a strong comparable period in the prior year, where we saw 27% operational growth driven by more disciplined approach to our promotional strategy.

Additionally, I will echo that we are seeing early signs that like Wella is beginning to stabilize while this is an early read we continue to see high satisfaction scores, among vets and pet owners, who use labelle.

Growth in alternative channels continues fueled by pet owner preference and higher compliance.

The meaningful and positive impact this brought it cause an adult living laboy.

This strength has helped sustain the Burger truth momentum despite continued softness in the U S vet channel.

Kristin Peck: Now, moving on to our Q3 segment results. As expected, growth moderated in the US as we entered the second half of the year, with revenue down 2% on a reported basis and up 3% on an organic operational basis. Companion animal was flat, and livestock grew 14% on an organic operational basis. This moderation primarily reflects the strong comparable period in companion animal, particularly in derm and parasiticides. In the vet channel, we continue to believe clinic revenue is more impactful to our growth than overall visits. That said, we saw declining visits across all major therapeutic areas during the third quarter, which impacted new patient starts. Meanwhile, the distributor inventory dynamics we discussed earlier in the quarter normalized by quarter end and remained near the low end of the historical range.

Well, that's your revenue of $17 million declined 4% in the quarter. Despite a decline this quarter driven by fewer new patient starts we remain optimistic about the untapped market potential of the feline OE space. We're currently only 15% of effective cats are receiving treatment.

As the leader in Triple combination parasiticide, the fastest growing seven in animal health. So Burger true is well positioned for continued growth driven by our first mover advantage blood label and strong market presence.

Sure Dermatology sales grew 1% to $306 million with growth in evergreen being partially offset by declines in photo point due to lower than mythology clinic visits.

Our U S livestock business posted broad based organic operational growth of 14% with almost all major brands showing improvement in the quarter.

Our growth in the quarter, primarily reflects the impact of initial distributor stocking of a couple of cool film coated tablet, which was made available to distribution in September.

Our performance was primarily driven by improved supply of a few here.

Additionally, as Christian mentioned, we have seen an acceleration in our lifestyle vaccines.

In addition to a strong comparable period in the prior year, we saw modest share loss in the U S. Derm space, primarily driven by competitive discounting and simply related to new product launches.

And I say divestiture due to increased field force focus.

Moving onto our international segment revenue grew 3% on a reported basis and 6% on an organic operational basis.

Based on our experience. These impacts are typically short lived and we remain confident in the value of our dermatology portfolio provides the vets and pet owners is that all pricing along with the quality and outcomes we deliver.

Kristin Peck: The US companion animal business was flat in the quarter, with growth in our Simparica and key Dermatology franchises offset by declines in our OA pain maps. Our Simparica franchise grew 2% in the quarter to $263 million in revenue. Our performance builds off of a strong comparable period in the prior year, where we saw 27% operational growth driven by a more disciplined approach to our promotional strategy. Growth in alternative channels continues, fueled by pet owner preference and higher compliance. This strength has helped sustain Simparica Trio's momentum despite continued softness in the US vet channel. As the leader in triple combination parasiticides, the fastest-growing segment in animal health, Simparica Trio is well-positioned for continued growth, driven by our first-mover advantage, broad label, and strong market presence.

Apparent animals grew 4% operationally and lifestyle grew 8% on an organic operational basis.

International Companion animal growth was driven by our <unk> and key dermatology franchises.

We are well positioned to grow and expand the dermatology market is moving toward anchored by our three differentiated brands with a proven track record of safety and efficacy and an estimated 11 million medicalized dogs, they remain untreated or under treated footage in the U S alone.

Our international <unk> franchise grew 22% operationally on $93 million in revenue with double digit growth across both brands.

It broke a true superstar personally to $41 million in sales bolstered by an increase in standard of care in many international markets.

Our OA pain products saw a decline of 21% in the U S and $58 million in sales.

And Parker with 15% operationally to 52 million that was himself growth remains strong, especially in markets that have not yet adopted triple combinations will that have low heartworm prevalence.

The brand posted $41 million in revenue for the quarter, a decline of 26% versus Q3 of last year.

Christa highlighted our multi pronged strategy to returning the bulk of the growth and we are confident that the actions. We are taking will help reaccelerate adoption.

Our key dermatology franchise grew 7% on an operational basis, what's being $162 million in revenue driven by both.

Additionally, I will echo that we are seeing early signs that lukoil is beginning to stabilize.

Kristin Peck: Key Dermatology sales grew 1% to $306 million, with growth in Apoquel being partially offset by declines in Cytopoint due to lower dermatology clinic visits. Our growth in the quarter primarily reflects the impact of the initial distributor stocking of the Apoquel film-coated tablet, which was made available to distribution in September. In addition to a strong comparable period in the prior year, we saw modest share loss in the US derm space, primarily driven by competitive discounting and sampling related to new product launches. Based on our experience, these impacts are typically short-lived, and we remain confident in the value our dermatology portfolio provides to vets and pet owners, and that our pricing aligns with the quality and outcomes we deliver.

Apple Quill and cider point.

Growth was driven primarily by Europe, where we continue to see expansion in new patients and increase compliance and corner cases, while we saw share loss to competitors in certain international markets with viewpoint like those in the U S are largely driven by launch promotions.

This is an early read we continue to see high satisfaction scores, among vets and pet owners, who use labella, reflecting the meaningful and positive impact. This has on those living with a boy.

Well, that's your revenue of $17 million declined 4% in the quarter. Despite a decline this quarter driven by fewer new patient starts we remain optimistic about the untapped market potential of the feline space. We're currently only 15% of effective cuts obviously having treatment.

We continue to see significant room for expansion in our international markets and remain confident in our differentiator franchise of products continuing to be first line treatments.

Our ODP maps declined 3% operationally in international markets on $80 million in revenue.

Our U S livestock business posted broad based organic operational growth of 14% with almost all major brands showing improvement in the quarter.

Internationally sales were $62 million down 6% operationally in the quarter.

As Christa highlighted we continue to see perception challenges primarily in English speaking countries and are implementing many of the same tactics to return to growth.

Kristin Peck: We are well-positioned to grow and expand the dermatology market moving forward, anchored by our three differentiated brands with a proven track record of safety and efficacy, and an estimated 11 million medicalized dogs that remain untreated or undertreated for itch in the US alone. Our OA pain products saw a decline of 21% in the US on $58 million in sales. Librela posted $41 million in revenue for the quarter, a decline of 26% versus Q3 of last year. Kristin highlighted our multi-pronged strategy to return Librela to growth, and we are confident that the actions we are taking will help re-accelerate adoption. Additionally, I will echo that we are seeing early signs that Librela is beginning to stabilize.

Our performance was primarily driven by improved supply of fear fear.

Additionally, as Christian mentioned, we have seen an acceleration in our lifestyle vaccines.

So, let's see yourselves grew 9% operationally $18 million.

And I say divestiture.

This will force focus.

Well, let's see adoption continues to expand as the product to redefine the standard of care for feline osteoarthritis supported by strong and sustained that satisfaction.

Moving onto our international segment revenue grew 3% on a reported basis and 6% on an organic operational basis.

We are excited about the recent European approval of a long acting feline away P Knab porcella.

Apparent animals grew 4% operationally and lifestyle grew 8% on an organic operational basis.

But that was extended dosing interval delivers meaningful quality of life benefits for cats, and pet owners alike gaming to drive stronger treatment compliance.

International Companion animal growth was driven by our some paragraphs. Thank you dermatology franchises.

Our international network of franchise with 22% operationally on $93 million in revenue with double digit growth across both brands.

International livestock grew 8% on an organic operational basis in the quarter with broad based growth across all.

Broker true with 32% operationally to $41 million in sales bolstered by an interesting standard of care in many international markets.

Kristin Peck: While this is an early read, we continue to see high satisfaction scores among vets and pet owners who use Librela, reflecting the meaningful and positive impact this product has on dogs living with OA. Solensia revenue of $17 million declined 4% in the quarter. Despite a decline this quarter driven by fewer new patient starts, we remain optimistic about the untapped market potential of the feline OA space, where currently only 15% of affected cats are receiving treatment. Our US livestock business posted broad-based organic operational growth of 14%, with almost all major brands showing improvement in the quarter. Our performance was primarily driven by improved supply of Ceftiofur. Additionally, as Kristin mentioned, we have seen an acceleration in our livestock vaccines post-MFA divestiture due to increased field force focus.

Four species.

In cattle growth was driven by both price and volume across the portfolio.

And Parker grew 15% operationally to 52 million that was himself growth remains strong, especially in markets that have not yet adopted triple combinations will that have low heartware and prevalence.

Poultry continues to benefit from focus and execution on vaccine growth. Additionally, we saw increased key account penetration across most geographies.

Finally, fish was driven by price increases as producers recognize the value our products provide driving healthier fish and Lori mortality rates contributing to higher yields.

Our key dermatology franchise grew 7% on an operational basis, what's being $162 million in revenue driven by both.

Ethical and cider point.

Now moving on to the rest of the P&L for the quarter.

Growth was driven primarily by Europe, where we continued to see expansion in new patients and increase compliance and corner cases.

Adjusted gross margins of 71.6, where thing with 90 basis points on a reported basis.

Saw share loss to competitors in certain international markets. These viewpoints like those in the U S are largely driven by launch promotions.

Foreign exchange had a favorable impact of 20 basis points.

Excluding the impact of foreign exchange, we saw higher margins due to favorable impact of our MFA divestiture.

We continue to see significant room for expansion in our international markets and remain confident in our differentiated franchise of products continuing to be first line treatments.

Well it benefits from price.

Adjusted operating expenses increased by a modest 1% operationally, reflecting our ongoing commitment to cost discipline and the dynamic and inflationary environment.

Kristin Peck: Moving on to our international segment, revenue grew 3% on a reported basis and 6% on an organic operational basis. Companion animal grew 4% operationally, and livestock grew 8% on an organic operational basis. International companion animal growth was driven by our Simparica and key dermatology franchises. Our international Simparica franchise grew 22% operationally on $93 million in revenue, with double-digit growth across both brands. Simparica Trio grew 32% operationally to $41 million in sales, bolstered by an increasing standard of care in many international markets. Simparica grew 15% operationally to $52 million in sales. Growth remained strong, especially in markets that have not yet adopted triple combinations or that have low heartworm prevalence. Our key dermatology franchise grew 7% on an operational basis, posting $162 million in revenue, driven by both Apoquel and Cytopoint.

Our ODP maps declined 3% operationally in international markets on $80 million in revenue.

Adjusted net income grew 5% operationally and 9% organic operational basis.

Internationally sales were $62 million down 6% operationally in the quarter.

Adjusted diluted EPS grew 7% operationally in the quarter and 12% on an organic operational basis.

As Chris highlighted we continue to see perception challenges primarily in English speaking countries and are implementing many of the same U S tactics to return to growth.

Now moving to guidance for full year 2025.

Please note that guidance reflects foreign exchange rates as of late October and does not assume any impact of future tariffs what policy changes.

So, let's see yourselves with 9% operationally $18 million.

Well, let's see adoption continues to expand as the product redefines definitive careful feline ulcerative colitis supported by strong and sustain that satisfaction.

We are revising our full year revenue guidance to a range of $9 4 billion and my point for seven $5 billion and organic operational growth of five 5% to 615% based on a more measured view of macro and operational trends in the back half of the year.

We are excited about the recent European approval over a long acting feline away P Knab portola.

But that was extended dosing interval delivers meaningful quality of life benefits for pets, and pet owners alike gaming to drive stronger treatment compliance.

We now expect adjusted net income to be in the range of $2 8 billion to $8 $4 billion, reflecting a narrowed organic operational growth range of five 5% to 7%.

National lifestyle grew 8% on an organic operational basis in the quarter with broad based growth across all.

Finally, we are maintaining our reported diluted and adjusted diluted EPS guidance range of $5 90 to $6.

Kristin Peck: Growth was driven primarily by Europe, where we continue to see expansion in new patients and increased compliance in chronic cases. While we saw share loss to competitors in certain international markets, these declines, like those in the US, are largely driven by launch promotions. We continue to see significant room for expansion in our international markets and remain confident in our differentiated franchise of products continuing to be first-line treatments. Our OA pain meds declined 3% operationally in international markets on $80 million in revenue. International Librela sales were $62 million, down 6% operationally in the quarter. As Kristin highlighted, we continue to see perception challenges primarily in English-speaking countries and are implementing many of the same US tactics to return to growth. Solensia sales grew 9% operationally to $18 million.

<unk> species.

In cattle growth was driven by both price and volume across the portfolio.

$6 30 to $6 40, respectively.

Poultry continues to benefit from focus and execution on vaccine growth. Additionally, we saw increased key account penetration across most geographies.

We are operating from a position of strength supported by the broadest portfolio in the industry, even though we don't navigating some temporary headwinds.

Finally, fish was driven by price increases as producers recognize the value of our products provide driving healthier fish and lower mortality rates contributing to higher deals.

We remain confident in the long term growth potential of both our business and the broader animal health market.

Now I'll hand things over to the operator to open the line for your questions.

Now moving on to the rest of the P&L for the quarter.

Later.

Mr. Joseph Ladies and gentlemen at this time, if you would like to ask a question. Please press star one on your telephone if at any point. Your question has been answered you may remove yourself from the queue by pressing star two and the interest of time, we ask that you. Please limit yourself to one question and then queue up again with any follow ups. Your line will be muted when you complete your question and when posing your question.

Adjusted gross margins of 71.6, where thing with 90 basis points on a reported basis.

Exchange had a favorable impact of 20 basis points.

Excluding the impact of foreign exchange, we saw higher margins due to favorable impact of our MSA divestiture.

Well as benefits from price.

Please pickup your handset to allow optimal sound quality will go first this morning to Erin Wright of Morgan Stanley.

Adjusted operating expenses increased by a modest 1% operationally, reflecting our ongoing commitment to cost discipline and the dynamic and inflationary environment.

Kristin Peck: Solensia adoption continues to expand as the product redefines the standard of care for feline osteoarthritis, supported by strong and sustained vet satisfaction. We are excited about the recent European approval of our long-acting feline OA pain med, Portela. Portela's extended dosing interval delivers meaningful quality-of-life benefits for cats and pet owners alike, aiming to drive stronger treatment compliance. International livestock grew 8% on an organic operational basis in the quarter, with broad-based growth across all four species. In cattle, growth was driven by both price and volume across the portfolio. Poultry continues to benefit from focus and execution on vaccine growth. Additionally, we saw increased key account penetration across most geographies. Finally, fish was driven by price increases as producers recognized the value our products provide in driving healthier fish and lower mortality rates, contributing to higher yields.

Great. Thanks so.

First I just wanted to know kind of what meaningfully changed for you kind of on an inter quarter basis. After you raised guidance last quarter and what were some of the key surprises that you saw whether it's competition or destock or otherwise, but also on competition. Just you mentioned some of the competitive dynamics in dermatology and just curious how you're seeing practices at this.

Adjusted net income grew 5% operationally and 9% on an organic operational basis.

Adjusted diluted EPS grew 7% operationally in the quarter and 12% on an organic operational basis.

Now moving to guidance for full year 2025.

Please note that guidance reflects foreign exchange rates as of late October and does not assume any impact of future tariffs or policy changes.

Point, how they're looking at the category are they carrying both JAK inhibitors and some of those certain international markets that you were you were talking about and.

We are revising our full year revenue guidance to a range of $9 4 billion and my point 47, $5 billion and organic operational growth of five 5% to 615 per cent is one a more measured view of macro and operational trends in the back half of the year.

What do you have embedded now in terms of competition like do you think that guidance is conservative enough at this point and should we anticipate a continuing impact as we head into 2026, how does that fit into your typical 6% to 8% top line growth guidance that you would typically get is as we head into next year.

We now expect adjusted net income to be in the range of $2 8 billion to $8 $4 billion, reflecting a narrowed organic operational growth range of five 5% to 7%.

Just given where it's tracking below that year to date. Thanks.

Kristin Peck: Now, moving on to the rest of the P&L for the quarter. Adjusted gross margins of 71.6% grew 90 basis points on a reported basis. Foreign exchange had a favorable impact of 20 basis points. Excluding the impact of foreign exchange, we saw higher margins due to favorable impact of our MFA divestiture, as well as benefits from price. Adjusted operating expenses increased by a modest 1% operationally, reflecting our ongoing commitment to cost discipline in a dynamic and inflationary environment. Adjusted net income grew 5% operationally and 9% on an organic operational basis. Adjusted diluted EPS grew 7% operationally in the quarter and 12% on an organic operational basis. Now, moving to guidance for the full year 2025. Please note that guidance reflects foreign exchange rates as of late October and does not assume any impact of future tariffs or policy changes.

Yeah, Thanks Jan look.

Finally, we are maintaining our reported diluted and adjusted diluted EPS guidance range of $5 90 to $6.

Clearly as we entered the year, we expected some deceleration.

<unk> in the back half of the year compared to how we would start 2025.

$6 30 to $6 40, respectively.

In the quarter, what we saw besides the really strong comp that we anticipated and factored in besides anticipating a competitive launch dynamics in terms of aggressive promotions, we factored into our thinking coming into the year, we certainly saw a bit of.

We are operating from a position of strength supported by the broadest portfolio in the industry, even though we are navigating some temporary headwinds.

We remain confident in the long term growth potential of both our business and the water animal health market.

Now I'll hand things over to the operator to open the line for your questions.

Later.

Macro impact, particularly in U S clinics over the last three quarters, you've seen therapeutic visits as you know overall visits so not a great gauge.

Thank you Mr. Joseph Ladies and gentlemen at this time, if you would like to ask a question. Please press star one on your telephone if at any point. Your question has been answered you may remove yourself from the queue by pressing star two and the interest of time, we ask that you. Please limit yourself to one question and then queue up again with any follow ups. Your line will be muted when you complete your question and when posing your question.

So our growth of therapeutics, because it certainly are and you need those to at least start patients before he can have multiple channels of fulfill those and so we saw three quarters in a row of therapeutic visit.

Pressure that has certainly impacted where the quarter landed and we factor those into our thinking in terms of the remainder of the year and the guidance that we have provided today to your point around guidance for 2026 as you know we will look forward to providing that in February however, I don't see the how we're exiting the year in the <unk>.

Please pickup your handset to allow optimal sound quality will go first this morning to Erin Wright of Morgan Stanley.

Kristin Peck: We are revising our full-year revenue guidance to a range of $9.4 billion to $9.475 billion, and organic operational growth of 5.5% to 6.5% based on a more measured view of macro and operational trends in the back half of the year. We now expect adjusted net income to be in the range of $2.8 billion to $2.84 billion, reflecting a narrowed organic operational growth range of 5.5% to 7%. Finally, we are maintaining our reported diluted and adjusted diluted EPS guidance range of $5.90 to $6.00 and $6.30 to $6.40, respectively. We are operating from a position of strength, supported by the broadest portfolio in the industry, even while we are navigating some temporary headwinds. We remain confident in the long-term growth potential of both our business and the broader animal health market. Now, I'll hand things over to the operator to open the line for your questions. Operator.

Great. Thanks so.

First I just wanted to know kind of what meaningfully changed for you kind of on an intra quarter basis. After you raised guidance last quarter and what were some of the key surprises that you saw whether it's competition or destock or otherwise, but also on competition just mentioned to make it happen.

Fourth quarter to be a read through to what 2026 will be I think there are a few.

Pieces here that I think are worth considering a four one we would typically see price contribution and as you know we have consistently done that over the years.

Yes.

How youre seeing this.

Please.

Got it.

Jackie.

We're typically we're in the 2% to 4% range, we've been above that if you look at the last couple of years.

So the international market.

And.

What do you have embedded now in terms of competition.

And this year, we're running closer to 4% and I think you can see us in the range that we typically would operate in from a price perspective.

That guidance is conservative and not at this point.

And we anticipate continuing that you'd have to ask you head into 2026, how does that fit into your typical to 8% top line growth guidance that you would typically as we head into next year.

Despite what we see historically as launch period aggressive promotions, we have high confidence in continuing to grow Aki franchise area, particularly germ parasiticide given the cigna.

We're tracking.

Good day.

Significant unmet.

Yeah.

Market opportunity in both of those areas. So we see those are driving growth for us as you look ahead and as we said in the prepared commentary we've seen signs of stabilization from the boiler perspective, which certainly has been a headwind for us throughout.

Hum.

Kristin Peck: Thank you, Mr. Joseph. Ladies and gentlemen, at this time, if you would like to ask a question, please press Star 1 on your telephone. If at any point your question has been answered, you may remove yourself from the queue by pressing Star 2. In the interest of time, we ask that you please limit yourself to one question and then queue up again with any follow-ups. Your line will be muted when you complete your question. And when posing your question, please pick up your handset to allow optimal sound quality. We'll go first this morning to Erin Wright of Morgan Stanley. Great. Thanks.

As we entered the year we expected.

Some deceleration in the back half of the year compared to how we would start 2025.

Certainly in the quarter, what we saw besides the really strong comp that we anticipated and factored in besides anticipating a competitive launch dynamics in terms of aggressive promotions.

Throughout this year, but particularly in the back half of this year and the consequent very strong in Q3 and labella comp in Q4 remained relatively strong so as we see signs of stabilization here, we would expect a return to growth.

<unk> thousand 26, and a couple of other things I would say here Aaron is that livestock has continued demonstrating the strength you've seen.

<unk> it into our thinking coming into the year, we certainly saw a bit of a macro impact, particularly in U S clinics over the last three quarters, you've seen therapeutic visits as you know overall visits are not a great gauge.

Kristin Peck: So at first, I just wanted to know kind of what meaningfully changed for you kind of on an interquarter basis after you raised guidance last quarter and what were some of the key surprises that you saw, whether it's competition or destock or otherwise. But also on competition, just you mentioned some of the competitive dynamics in dermatology. And just curious how you're seeing practices at this point, how they're looking at the category. Are they carrying both JAK inhibitors in some of those certain international markets that you were talking about? And what do you have embedded now in terms of competition? Do you think that guidance is conservative enough at this point? And shouldn't we anticipate a continuing impact as we head into 2026?

In our third year of consecutive growth above market and would anticipate continuing to see growth in livestock in 2026 as well. So those are the reasons why we would say the exit of this year is not indicative.

For a growth of therapeutics, because it certainly are and you need those to at least start patients before he can have multiple channels of fulfill those and so we saw three quarters in a row of therapeutic visit a pressure that has certainly impacted where the quarter landed and we factor those into our thinking in terms of the remainder of the year.

In terms of what 26 is though we're not prepared to give guidance here at this time.

Thank you Vanessa now to Michael Rice skin at Bank of America.

Great. Thanks for taking the question I wanted to stick on that topic of what's changed I mean, I hear your answer widening on some.

And the guidance that we have provided today to your point around guidance for 2026 as you know we will look forward to providing that in February however, I don't see the how we're exiting the year in the fourth quarter to be a read through to what 2026 will be I think there are a few.

Some of the macro and some of the dynamics I think the pushback kind of habit, but we've seen that be a challenge in the end market for several years now I think I mean, 2022 and 2023 whenever you with RBC.

Kristin Peck: How does that fit into your typical 6% to 8% top-line growth guidance that you would typically give as we head into next year, just given where it's tracking below that year to date? Thanks. Yeah, thanks, Erin. Look, clearly as we entered the year, we expected some deceleration in the back half of the year compared to how we would start 2025. Certainly, in the quarter, what we saw besides the really strong comp that we anticipated and factored in, besides anticipating competitive launch dynamics in terms of aggressive promotions, we factored into our thinking coming into the year, we certainly saw a bit of a macro impact, particularly in US clinics. Over the last three quarters, we've seen therapeutic visits. As you know, overall visits are not a great gauge for our growth, but therapeutic visits certainly are.

Pieces here that I think are worth considering a for one we would typically see price contribution and as you know we have consistently done that over the years.

No one else has really.

We've been able to put up better numbers than that in companion in the U S.

Through the second quarter surprisingly, we've heard you don't speak a thousand times about how you're insulated from some of those challenges about the importance of medication.

We're typically we're in the 2% to 4% range, we've been above that if you look at the last couple of years.

Certainly and this year, we're running closer to 4% and I think you can see us in the range that we typically would operate in from a price perspective.

As in the channels.

And all of that being able to sustain that growth. So it really is a pretty striking.

What we see historically as launch period aggressive promotions, we have high confidence in continuing to grow Aki franchise areas, particularly germ and parasiticide given the.

Shane.

In the U S and globally.

We've seen over the last couple of years.

I was just wondering the timing with competition coming on.

Significant unmet.

Yeah.

You mentioned some of that because that could be playing a bigger role because that would.

Market opportunity in both of those areas and we see those are driving growth for us as you look ahead and as we said in the prepared commentary we've seen signs of stabilization from a labor perspective, which certainly has been a headwind for us.

It will last longer.

Wondering if you could maybe dive into some of those things a little bit more and then as a follow up.

Kristin Peck: And you need those to at least start patients before you can have multiple channels fulfill those. And so we saw three quarters in a row of therapeutic visit pressure that has certainly impacted where the quarter landed. And we factored those into our thinking in terms of the remainder of the year and the guidance that we have provided today. To your point around guidance for 2026, as you know, we will look forward to providing that in February. However, I don't see how we're exiting the year in the fourth quarter to be a read-through to what 2026 will be. I think there are a few pieces here that I think are worth considering. For one, we would typically see price contribution. And as you know, we have consistently done that over the years. We're typically in the 2% to 4% range.

Throughout this year, but particularly in the back half of this year and the comps have been very strong in Q3 and labella comp in Q4 remains relatively strong so as we see signs of stabilization here, we would expect a return to growth in 2026 and a couple of other things I would say here Aaron is that livestock has continued to demonstrate strength plus you've seen.

Alluded to.

On the inter quarter dynamics.

The short of it by the end of the quarter see better trends.

You can say on distributor levels.

Inventory levels amongst some of your customers.

Just some thoughts on that as you go into the fourth quarter and into next year.

Now in our third year of consecutive growth above market and would anticipate continuing to see growth in livestock in 'twenty 'twenty six as well. So those are the reasons why we would see the exit of this year is not indicative.

Yeah sure I'd love to start and see if Chris wants to add anything in terms of the macro in terms of what we're seeing now suddenly as you.

Highlighted Mike over the last several years, you've seen overall visits being down.

And in fact down more than they were in the quarter.

In terms of what 26 is though we're not prepared to give guidance here at this time.

Overall visits were down somewhere just shy of 2% in the quarter.

You seem worse than that historically, what is different though is we have seen over the last three.

Thank you well go next now to Michael Rice skin at Bank of America.

Kristin Peck: We've been above that if you look at the last couple of years. Certainly, and this year, we're running closer to 4%. And I think you can see us in the range that we typically would operate in from a price perspective. Despite what we see historically as launch-period aggressive promotions, we have high confidence in continuing to grow our key franchise areas, particularly derm and parasite given the significant unmet market opportunity in both of those areas. So we see those driving growth for us as you look ahead. And as you said in the prepared commentary, we've seen signs of stabilization from a Librela perspective, which certainly has been a headwind for us throughout this year, but particularly in the back half of this year. And the comps have been very strong in Q3, and Librela comp in Q4 remains relatively strong.

Great. Thanks for taking the question I wanted to stick on that topic of what's changed I mean I hear your answer wasn't on.

Three quarters.

Recruiting visits being down if you recall last year, despite overall visits being down.

During visits were up about three or 4% on the year end or if he visits have been up a particular since we launched the OA pain products in the U S.

Some of the macro and some of the dynamics and the pushback I would have is that we've seen that be a challenge in the end market for several years now.

That has turned this year certainly you've seen that impact their beauty business I think we think heartworm, which are.

2022, and 2023 whenever you with RBC.

This is really.

Wellness visits.

<unk> been able to put up better numbers than that in companion in the U S.

Have consistently been down, but they've been more than offset by what's happening in the alternative channels. If you look at the last few years. So the difference here is there a therapeutic business, particularly when you look at.

Through the second quarter surprisingly strong we've heard you guys speak a thousand times about how you're insulated from some of those challenges.

<unk> as well as for the pain.

It'll translate into fewer patient starts and certainly we're starting to see that have an impact here now what is encouraging is we're continuing to see really strong growth across alternative channels. Those grew about 21% on the quarter.

So of the medication.

Falls in the channel there.

And all of that.

So it really is a pretty striking.

Kristin Peck: So as we see signs of stabilization here, we would expect a return to growth in 2026. And a couple of other things I would say here, Erin, is that livestock has continued to demonstrate strength for us. We've seen now in our third year of consecutive growth above market, and would anticipate continuing to see growth in livestock in 2026 as well. So those are all the reasons why we would say the exit of this year is not indicative in terms of what 2026 is, though we're not prepared to give guidance here at this time. Thank you. We'll go next now to Michael Ryskin at Bank of America. Great. Thanks for taking the question. I want to stick on that topic of what's changed. I mean, I hear your answer regarding some of the macro and some of the vet dynamics.

The companion animal in the U S.

And within that.

And globally.

Is actually a home delivery coming from vet channels as they continue to see opportunity to really drive and meeting the patients where they are we are seeing momentum in that area as well. It grew about the same reef is retail.

What we've seen over the last couple of years.

So I was just wondering the timing with competition coming on.

No.

You mentioned some of that because that could be playing a bigger role because that would be.

In the quarter again, some people will continue to encourage and watch as well as work with our clients to continue to drive so I think those elements certainly and continue to be there and are supportive of the business.

The last longer.

Wondering if you could maybe dive into some of those things a little bit more and then as a follow up.

Alluded to some of the inter quarter dynamics.

However, I think what we're seeing in terms of therapeutic business, where the impact has been and I think it's a bit of a combination of really a significant price increase that our customers have taken over the last few years, both across their products as well as services that are different from our price that we give to them and we're seeing that impacts, particularly those larger.

The short of it by the end of the quarter seeing better trends.

I'd say on distributor levels.

Inventory levels amongst some of your customers.

Some thoughts on that as you go into the fourth quarter.

And into next year.

Yeah sure I'd love to start and see if Chris wants to add anything in terms of the macro in terms of what we're seeing and certainly as you said you highlighted.

Accounts.

Kristin Peck: I think the pushback I have is that we've seen that be a challenge in the end market for several years now. I think, I mean, it's 2022 and 2023 where that really started being the case. And Zoetis has really consistently been able to put up better numbers than that in companion in the US, really through the second quarter, surprisingly strong. And we've heard you guys speak a thousand times about how you're insulated from some of those vet challenges, about the importance of medication, about some of the alternate channels that are able to go to, and all of that being able to sustain that growth. So it really is a pretty striking change in the companion outlook in the US and globally, sort of what we've seen over the last couple of years versus three Qs. So I'm just wondering the timing with competition coming on.

Well as we look at the numbers. So sitting here if you look at our portfolio of the broadest portfolio in the industry.

Highlighted Mike over the last several years, you've seen overall visits being down.

Our innovation engine continues to clock away the most productive in the industry as well so we're confident.

And in fact down more than they were in the quarter. We think overall visits were down somewhere just shy of 2% in the quarter.

They're there to drive growth as you look at the long term again, why we don't see the fourth quarter as an indication for 26 in particular.

You seem worse than that historically, what is different though is we have seen over the last.

Those give us a lot of confidence as we look ahead in terms of distributor inventory levels. We did highlight those in the middle of the quarter, we have seen distributors.

Three quarters.

Therapeutic visits being down if you recall last year. Despite overall visits being down during visits were up about three or 4% on the year and only paid visits have been up a particular since we launched the oil paint products in the U S. A.

Take moved ship their inventory levels down intra quarter. It did recover within the quarter and just to put it in the context Mike.

That has turned this year certainly you've seen that impact their beauty business, I think flea tick heartworm, which art.

Since the beginning of 2023, we have been operating at levels that are below the low end of the range in terms of level of inventory in distribution. We have remain there even as you exit the quarter. So while the adapt even further below where they have been operating last few years. They do recover back but the level is still below where it had been historically.

Wellness visits have consistently been down, but they've been more than offset by what's happening in the alternative channels. If you look at the last few years. So the difference here is there a therapeutic business, particularly when you look at it.

Kristin Peck: You mentioned some of that, but that could be playing a bigger role because that would indicate it would last longer. Just wondering if you could maybe dive into some of those changes a little bit more. And then as a follow-up, you alluded to some of the intra-quarter dynamics being short-lived, and by the end of the quarter, seeing better trends. Just anything you could say on distributor levels, inventory levels among some of your customers, just some thoughts on that as you go into the fourth quarter and again into next year. Thanks. Yeah, sure. I'd love to start and see if Kristin wants to add anything in terms of the macro, in terms of what we're seeing. Certainly, as you highlighted, Mike, over the last several years, you've seen overall visits being down. And in fact, down more than they were in the quarter.

<unk> Israel is boy pain.

That would translate into fewer patient starts and certainly we're starting to see that have an impact here now what is encouraging is we continue to see really strong growth across alternative channels. Those grew about 21% on the quarter and.

Thank you we'll go next now to Jon block with Stifel.

Hey, guys, sorry to harp on the same theme, but can I push you on the $4 25 exit not being sort of indicative for 26, we're calc ing.

And within that.

<unk> is actually a home delivery coming from the channels as we continue to see opportunity to really drive and meeting the patients where they are we are seeing momentum in that area as well. It grew about the same reef is retail within the quarter again, some people will continue to encourage and watch as well as work with our clients to continue to drive.

Sort of an implied 3% organic operational and <unk> hopefully we've got that right. It's off of a club that eases materially, but just to take a step back.

I would think that sort of implies zero was from volume in the back half of 'twenty. Five you said volume was zero. This quarter price was up four so if you think about like zero vols in two age 25 competition, increasing further in some key franchises, notably Derby, we never know exactly what's.

So I think those elements certainly continued to be there and are supportive of the business.

However, I think what we're seeing in terms of therapeutic visits where the impact has been and I think it's a bit of a combination of really significant price increase that our customers have taken over the last.

Kristin Peck: We think overall visits were down somewhere just shy of 2% in the quarter. And you've seen worse than that historically. What is different, though, is we have seen over the last three quarters therapeutic visits being down. If you recall last year, despite overall visits being down. Derm visits were up about 3% or 4% on the year. OA pain visits have been up, particularly since we launched our OA pain products in the US. That has turned this year. Certainly, you've seen that impact therapeutic visits. I think flea-tick heartworm, which are wellness visits, have consistently been down, but they've been more than offset by what's happening in the alternative channels if you look at the last three years. So the difference here is there are therapeutic visits, particularly when you look at derm, as well as OA pain, that are translating to fewer patient starts.

A few years both across their products as well as services that are different from our price that we give to them and we're seeing that impacts, particularly those larger corporate accounts.

Going to happen, but that seems to be the case.

Why would that be indicative in other words, what changes between the price volume Algo. There's price go higher you know where does ball's balance and evolve bounds why would that sort of a backdrop. Thanks for taking the time.

Well as we look at the numbers so.

Sitting here, if you look at our portfolio of the broadest portfolio in the industry.

Our innovation engine continues to clock away the most productive in the industry as well so we're confident.

Yes.

Alright.

I think what we said in terms of the fourth quarter exit and you're roughly right in terms of your calculation. However, I would remind you of a few things and again at the risk of being repetitive on this to some extent.

To drive growth as you look at the long term again, why we don't see the fourth quarter as an indication for 26 in particular.

Those give us a lot of confidence as we look ahead.

We are exiting with Dolby have year over year comps with respect to labella that continued to be.

Terms of distributor inventory levels, we did highlight those in the middle of the quarter, we have seen distributors.

Kristin Peck: And certainly, we're starting to see that have an impact here. Now, what is encouraging is we continue to see really strong growth across alternative channels. Those grew about 21% on the quarter. And within that is actually home delivery coming from vet channels as they continue to see opportunity to really drive and meeting the patients where they are. We are seeing momentum in that area as well. It grew about the same rate as retail within the quarter. Again, something we'll continue to encourage and watch, as well as work with our vet clients to continue to drive. So I think those elements certainly continue to be there and are supportive of the business. However, I think what we're seeing in terms of therapeutic visits is where the impact has been.

Challenging we are exiting with that showing signs of stabilizing and so again, we expect that to turn to growth as we get into 'twenty.

Move ship their inventory levels down central quarter, It did recover within the quarter and just to put it in the context Mike.

2026.

Since the beginning of 2023, we have been operating at levels that are below the low end of the range in terms of level of inventory in distribution. We have remain there even as you exit the quarter. So while the dip even further below where they have been operating last few years. They do recover back but the level is still below where it had been historically.

We came into this year expecting to see some competitive pressure as they launch their products and are looking to to.

Again, some traction given the high satisfaction level, we have no products.

Number of years that we have particularly when you think about dirt we'd been in the market for 11 years were roughly 120 million doses in when you look at a combination of App Aquila insider point the level of satisfaction with customers, both pet owners Israel events.

Very very hot so competitors as they launch their products are up against that strong.

Thank you we'll go next now to Jon block with Stifel.

Kristin Peck: And I think it's a bit of a combination of really significant price increase that our vet customers have taken over the last few years, both across their products, as well as services, that is different from our price that we give to them. And we're seeing that impact, particularly the larger corporate accounts, as well as we look at the numbers. So sitting here, if you look at our portfolio, we have the broadest portfolio in the industry. Certainly, our innovation engine continues to chug along the most productive in the industry as well. So we're confident in our ability to drive growth as we look at the long term. Again, why we don't see the fourth quarter as an indication for 2026 in particular. And that those give us a lot of confidence as we look ahead.

Hey, guys, sorry to sort of harp on the same theme, but can I push you on the four $2 25 exit not being sort of indicative for 26, we're calc ing.

Our position and our as we anticipated.

Being very aggressive to look to get position. If you look at where they are from a patient share perspective, it's still very limited.

Drove it implies 3% organic operational and <unk> hopefully we've got that right. It's off of a club that eases materially, but just to take a step back.

Now I think this is where the macro comes in and I think if you look at the macro in a market where are you seeing fewer visits.

Visits than the impact of those competitive pressures will be felt a little bit more than when you have extension now if you look at term and international <unk> grew 7% on the quarter and that's despite.

I would think that sort of implies zero was from volume in the back half of 'twenty. Five you said volume was zero. This quarter price was up four so if you think about like zero balls and <unk> 25 competition, increasing further in some key franchises, notably Durbin, we never know exactly what's.

Certain markets, where you seem very aggressive and competitive pressure, but you are seeing expansion all of those markets and.

Well I'm going to sit here and predict how long the macro will be there our position, though in terms of our polishing our portfolio couldn't be stronger and so again I don't see this as a permanent feature and as you've seen historically these initial watch.

Could it happen, but it seems to be the case.

Kristin Peck: In terms of distributor inventory levels, we did highlight those in the middle of the quarter. We have seen distributors shift their inventory levels down in the quarter. It did recover within the quarter. And just to put it in the context, Mike. Since the beginning of 2023, we have been operating at levels that are below the low end of the range in terms of level of inventory in distribution. We have remained there even as we exit the quarter. So while they dipped even further below where they have been operating the last two years, they did recover back, but the level is still below where they have been historically. Thank you. We'll go next now to Jon Block with Stifel. Hey, guys.

Why wouldn't that be indicative in other words, what changes between the price volume Algo. There's price go higher you know where does evolve balancing a ball bounce why would that sort of a backdrop. Thanks for taking the time.

Promotions tend to be short lived and so we'll make adjustments, where we see a necessary, but we will be disciplined as we execute in this market.

Yes.

We've been there before and so we will continue to do that and we're very strong in terms of our portfolio as well as what's coming in terms of what we're starting to see approvals on all right.

Sorry.

Thank you well go next now to Brandon Vazquez at William Blair.

We are exiting with Dolby have year over year comps with respect to labella, there continues to be challenging.

Hey, Thanks for taking my question I wanted to switch a little bit and talk about the new long acting the way drugs that had been approved or upcoming.

Challenging we are exiting with that showing signs of stabilizing and so again, we expect that to trend to growth as we get into.

The question being clearly library launch didn't go as planned I think the safety and efficacy stands behind it but social media kind of got a little bit ahead of our of the drug and impacted its adoption is we're seeing.

2026, so we came into this year expecting to see some competitive pressure as they launch their products and are looking to.

Kristin Peck: Sorry to sort of harp on the same theme, but can I push you on the Q4 2025 exit not being sort of indicative for 2026? We're calculating sort of an implied 3% organic operational in Q4. Hopefully, we've got that right. It's off of a comp that eases materially. But just to take a step back, I would think that sort of implies zero-ish volume in the back half of 2025. You said volume was zero this quarter, price was up four. So if you think about zero vols in H2 2025, competition increasing further in some key franchises, notably derm, we never know exactly what's going to happen, but that seems to be the case. Why wouldn't that be indicative? In other words, what changes between the price volume algo? Does price go higher, or does vols bounce?

To gain some traction given the high satisfaction level, we have no products and a number of years that we have particularly when you think about dirt we'd been in the market for 11 years were roughly 120 million doses in when you look at a combination of a prequel insider point the level of satisfaction with customers both pet owners as those reps.

What did you guys learn what is going to change as you launch these new long acting the way drugs because they.

A successful launch of these into 2026 feels like it could be one of the key levers to remain within the 6% to 8% organic growth that you guys had talked about for a long time. So just curious on thoughts of what that launch might look like relative to what library law was and what gives you. The confidence that you can kind of have a more successful ramp from there. Thank you.

Very very hot so competitors as they launch their products are up against that strong.

Our position and our as we anticipated.

Being very aggressive to look to get position. If you look at where they are from a patient share perspective, it's still very limited.

Thanks, Brendan I'll take that one.

We were very pleased with the approval in Canada, and a positive opinion in the EU on linear.

No I think this is where the macro it comes in and I think if you look at the macro in a market where are you seeing fewer visits.

Visits than the impact of those competitive pressures will be felt a little bit more than when you have an extension now if you look at term and international <unk> grew 7% on the quarter and that's despite.

I think another example of us delivering on our commitments across our innovation pipeline. You know we are really excited about that as well as portela, which received its first approval in the EU I think we are going to make sure that we apply all the learnings we had from liberal up to these new launches we are expecting launch as we mentioned in the first half up 26.

Kristin Peck: And if vols bounce, why with that sort of a backdrop? Thanks for taking the time. Yeah, Jon, I'll start. Look, I think what we said in terms of the fourth quarter exit, and you're roughly right in terms of your calculation. However, I would remind you of a few things. Again, at the risk of being repetitive on this to some extent, we are exiting with, though we have year-over-year comps with respect to Librela that continue to be challenging, we are exiting with that showing signs of stabilizing. So again, we expect that to turn to growth as we get into 2026.

Certain markets, where you've seen very aggressive and competitive pressure, but you are seeing expansion in all those markets and while.

Well I won't sit here and predict how long the macro will be there our position, though in terms of our products in our portfolio couldn't be stronger and so again I don't see this as a permanent feature and as you've seen historically. These initial watch promotions tend to be short lived and so we'll make adjustments, where we see a necessary, but we will be disciplined.

For linear and you know, we're gonna find learning from them about what we're gonna start as we talked about with early experience with specialists make sure. They understand the product well and then they can help us as we launch more into the general veterinary population.

We're going to make sure we continue to raise awareness of OA as a serious disease that requires a proactive approach to manage the pain. It's a progressive disease, we're going to make sure. We continue to deepen education with specialists Earth and also with with that and we're going to you know the same way, we're doing with their bellow, where in that thing.

Kristin Peck: Look, we came into this year expecting to see some competitive pressure as they launched their products and are looking to gain some traction given the high satisfaction level we have in our products and the number of years that we have, particularly when you think about derm. We've been in the market for 11 years. We're roughly 120 million doses in when you look at a combination of Apoquel and Cytopoint. The level of satisfaction with customers, both pet owners as well as vets, is very, very high. So competitors, as they launch their products, are up against that strong position and are, as we anticipated, being very aggressive to look to get position. If you look at where they are from a patient share perspective, it's still very limited. Now, I think this is where the macro comes in.

And as we execute in this market.

We've been there before and so we'll continue to do that and we're very strong in terms of our portfolio as well as what's coming in terms of what we're starting to see approvals on all right.

Thank you well go next now to Brandon Vazquez at William Blair.

In you know long term phase for research to make sure specialists and veterinarians continue to understand how best to use the products. You know we're really excited with these new products as you think about when nivea.

Hey, Thanks for taking my question I wanted to switch a little bit and talk about the new long acting the way drugs that had been approved or upcoming.

It will add convenience.

The question being clearly library lives launch didn't go as planned I think the safety and efficacy stands behind it but social media kind of got a little bit ahead of our of the drug and impacted its adoption as you're seeing.

Three months administration will help us expand the market some and put a lower barrier to entry I think will also help us increase compliance as we've talked about before when nivea will target a different location on NGL, it's a different molecule than labella, it'll provide long lasting relief at 10 times lower the dose that we do.

What did you guys learn what's going to change as you launch these new long acting away drugs because.

Kristin Peck: And I think if you look at the macro in a market where you're seeing fewer therapeutic visits, then the impact of those competitive pressures will be felt a little bit more than when you have extension. Now, if you look at derm in international, that grew 7% on the quarter. That's despite in certain markets where you've seen very aggressive competitive pressure, but you are seeing expansion of those markets. While I won't sit here and predict how long the macro will be there, our position, though, in terms of our products and our portfolio, couldn't be stronger. So, again, I don't see this as a permanent feature. As you've seen historically, these initial launch promotions tend to be short-lived. We'll make adjustments where we see necessary, but we'll be disciplined as we execute in this market. We've been there before. We'll continue to do that.

A successful launch of these into 2026, it feels like it could be one of the key levers to remain within the 6% to 8% organic growth that you guys had talked about for a long time, just curious on thoughts of what that launch might look like relative to what library law was and what gives you the confidence that can kind of have a more successful ramp from there. Thank you.

Fact, it to expand the market and provide incremental revenues, although obviously it will cannibalize some of labella I think its an exciting new opportunity for us I would say the same with portela, which is again a different area of MDF and are targeting it again is a different molecule, but I think especially if you think about how you can help us expand that market in cats.

<unk>.

Thanks, Brendan I'll take that one.

Bringing your cat in.

We were very pleased with the approval in Canada, and a positive opinion in the EU on linear.

Yeah every month is a big barrier as we know or cat and we're seeing strong growth in cats. So let's see how it grew in the quarter as you saw.

I think another example of us delivering on our commitments across our innovation pipeline and we are really excited about that as well as portela, which received its first approval in the EU I.

We see this thing you know the bright spot in this overall with cat visits increasing and we really believe it's Olympia is one of the reasons, it's helping drive that cat does it grow. So we're excited about both of those launches and their ability to expand the market for OA pain for us and 2026.

I think we are going to make sure that we apply all the learnings we had from liberal up to these new launches we are expecting launch as we mentioned in the first half up 26 for linear and you know we're gonna find the learnings from Labella I. We're gonna start as we talked about with early experience with specialists make sure they understand the product well and then they can help us as we launch.

Kristin Peck: We're very strong in terms of our portfolio, as well as what's coming in terms of what we're starting to see approvals on already. Thank you. We'll go next now to Brandon Vasquez at William Blair. Hey, thanks for taking the question. I wanted to switch a little bit and talk about the new long-acting OA drugs that have been approved or are upcoming. The question being that clearly Librela's launch didn't go as planned. I think the safety and efficacy stands behind it, but social media kind of got a little bit ahead of the drug and impacted its adoption as we're seeing. What have you guys learned? What's going to change as you launch these new long-acting OA drugs?

Thank you well go next now to Chris Schott at Jpmorgan.

Great. Thanks, so much for the questions.

Trying to get my hands around what happened with the U S. A term this quarter I know you've talked a lot about the comps in macro but can you just elaborate a little bit more in terms of what we're seeing either with its been really a or positioning ahead of a potential Merck launch. It just seems like we saw quite a trend break this quarter relative to the past year. It was trending a little.

More into the general veterinary population.

And also with that and we're going to you know the same way we're doing with their Bella we're investing in a long term phase for research to make sure specialists and veterinarians continue to understand how best to use the products. We're really excited with these new products as you think about when Nivea you know it will add convenience.

More color there.

Just as a follow up on the therapeutic visit side. It sounds like from your commentary that we need to see somebody's visit trends improve to get new starts in the right place et cetera can you just elaborate a little bit more in terms of what your outlook of when we could see that recovery or more just qualitatively what it's going to take to get these to recover again. Thanks. So much.

Kristin Peck: Because a successful launch of these into 2026 feels like it could be one of the key levers to remain within that 6% to 8% organic growth that you guys have talked about for a long time. Just curious on thoughts of what that launch might look like relative to what Librela was and what gives you the confidence it can kind of have a more successful ramp from there. Thank you. Thanks, Brandon. I'll take that one. We're very pleased with the approval in Canada and the positive opinion in the EU on Linivia. It's, I think, another example of us delivering on our commitments across our innovation pipeline. We are really excited about that, as well as Portela, which received its first approval in the EU. I think we are going to make sure that we apply all the learnings we had from Librela to these new launches.

You know a three month administration will help us expand the market them and put a lower barrier to entry I think will also help us increase compliance as we've talked about before when nivea will target a different location on NGL, it's a different molecule than labella. They provide long lasting relief at 10 times lower the dose.

Sure.

Look I think as we discussed the competitive positioning.

Positioning here isn't significantly different than what we anticipated coming into the year or even as we saw.

A quarter ago again, the if.

If you look at the patient share gains in here there relative to looking at it now as we look at Q4, we are factoring in a full launch of a competitive product in Europe are coming in with the mail V, which started in third quarter. So we are anticipating that and that's factored into our guidance certainly.

So we do expect it to expand the market and provide incremental revenues, although obviously it will cannibalize some of labella, but I think it's an exciting new opportunity.

I would say the same with Portola, which is again a different area and yet but are targeting it again is a different molecule, but I think especially as you think about cats, you can help us expand that market in cats were bringing your cat in.

Kristin Peck: We are expecting launches, we mentioned, in H1 2026 for Linivia. We're going to apply the learnings from Librela. We're going to start, as we talked about, with early experience with specialists, make sure they understand the product well, and then they can help us as we launch more into the general veterinary population. We're going to make sure we continue to raise awareness of OA as a serious disease that requires a proactive approach to manage the pain. It's a progressive disease. We're going to make sure we continue to deepen education with specialists first and also with vets. We're going to, the same way we're doing with Librela, invest in long-term phase four research to make sure specialists and veterinarians continue to understand how best to use the products. We're really excited with these new products. As you think about Linivia, it will add convenience.

No word yet in terms of exactly when the Mercury who will be in the U S.

As we have said that they expected approval.

Every month is a big barrier as we know or cat and we're seeing strong growth in cat. So let's see how it grew in the quarter as you saw and we see this thing you know the bright spot in visits overall with cat visits increasing and we really believe it's Olympia is one of the reasons, it's helping drive that cat does it grow. So we're excited about both of those launches.

This year early next year, so that's not really a potential topic here as we exit the year. However, the comparative again piece isn't significantly different I think the difference here, Chris it's truly what is the impact of therapeutic visits which were up the last few years, even as overall visits were down that turned this year, where we seem to have it because it's full.

And our ability to expand the market for OA pain for us and 2026.

Hum for derm declining on a year and the cumulative effect of those as we got into this quarter, we're seeing that impact in terms of a.

Thank you well go next now to Chris Schott at Jpmorgan.

Patient starts exactly when we will see those turnaround I won't venture to to give you here, but we are assuming the macro continues into the fourth quarter certainly what you see in fact in here and we will be built in terms of.

Great. Thanks, so much for the questions I'm, just still trying to get my hands around what happened with the U S. A term this quarter I know you've talked a lot about the comps and macro but can you just elaborate a little bit more in terms of what we're seeing either with centralia or positioning ahead of a potential Merck launch. It just seems like we saw quite a.

Kristin Peck: A three-month administration will help us expand the market some and put a lower barrier to entry. I think it will also help us increase compliance. As we've talked about before, Linivia will target a different location on NGF. It's a different molecule than Librela. It provides long-lasting relief at 10 times lower the dose. So we do expect it to expand the market and provide incremental revenues, although obviously it will cannibalize some of Librela. But I think it's an exciting new opportunity for us. I would say the same with Portela, which is, again, a different area of NGF that it's targeting. It again is a different molecule. But I think especially as you think about cats, it can help us expand that market in cats where bringing your cat in every month is a big barrier, as we know, for cats.

What that means in terms of the guidance in February one last point I will give is as you factor. These.

Once again, a very encouraging to see umbrella are showing signs of stabilization and so those are areas that we are looking forward to as we enter into 2026.

Trend break this quarter relative to the past year as supposed to trade at a little bit more color there and just as a follow up on the therapeutic visit side. It sounds like from your commentary that we need to see somebody's visit trends improve to get new starts in the right place et cetera can you just elaborate a little bit more in terms of what your outlook of when we could see that recovery or more just qual.

One last point in terms of the guidance very pleased if you look at the disciplined execution from our expense management perspective.

Not only in terms of the performance in the quarter with 12% growth.

Diluted EPS, but we are maintaining our guidance. So many P. S perspective in terms of bottom line for the year versus the guidance that we gave back in August again. These are elements that I'm going to want to remind you of kind of Christian on Saturday.

<unk>, what it's going to take to get these to recover again, thanks so much.

Sure.

Look I think as we discussed the competitive.

Positioning here isn't significantly different than what we anticipated coming into the year or even as we saw a quarter ago and the if.

The only thing I'll build on with regards to Labella is you know umbrella remains widely used with over 30 million doses distributed globally and we do remain confident in Nebraska has growth potential I you know I think executing on a multi pronged strategy.

Kristin Peck: And we're seeing strong growth in cats. Solensia grew in the quarter, as you saw. And we see cat visits being the bright spot in visits overall, with cat visits increasing. And we really believe that Solensia is one of the reasons it's helping drive that cat visit growth. So we are excited about both of those launches and their ability to expand the market for OA pain for us in 2026. Thank you. We'll go next now to Chris Schott at JPMorgan. Great. Thanks so much for the questions. I'm just still trying to get my hands around what happened with US derm this quarter. I know you've talked a lot about the comps and macro, but can you elaborate a little bit more in terms of what we're seeing, either with Zenrelia or positioning ahead of a potential Merck launch?

If you look at the patient share gains are in here are they're relatively limited now because we look at Q4, we are factoring in a full launch of a competitive product in Europe are coming in with the mail V, which started in third quarter. So we are anticipating that and that's factored into our guidance certainly.

We're starting to see the signs of stabilization right now it gives us confidence that the actions. We're taking are going to return the relative growth and as we mentioned, we believe will return to growth in 2026. So.

What gives us that confidence is watching the trends over the last few.

No word yet in terms of exactly when the Mercury who will be in the U S.

Few months ago, we look what we're trying to four to six weeks at a time rolling them and that's what gives us confidence that we'll see stabilizing and will return to growth in 2026.

As we have said that they expected approval.

This year early next year, so that's not really a potential topic here as we exit the year. However, the quoted again piece isn't significantly different I think the difference here Chris is truly what is the impact of therapeutic visits which were up the last few years, even as overall visits were down that turned this year, where we seem to have it because it's full.

I think it's really strong execution across our multi pronged strategy.

Thank you. We'll go next now to skeet, Steve Scala at TD Securities.

Thank you this is Chris on for Steve just.

Kristin Peck: It just seems like we saw quite a trend break this quarter relative to the past year, and it's turning a little bit more color there. And just as a follow-up, on the therapeutic visit side, it sounds like from your commentary, we need to see some of these visit trends improve to get new starts in the right place, et cetera. Can you just elaborate a little bit more in terms of what your outlook of when we could see that recovery, or more just qualitatively, what it's going to take to get these to recover again? Thanks so much. Sure. Look, I think, as we discussed, the competitive positioning here isn't significantly different than what we anticipated coming into the year, or even as we saw a quarter ago. Again, if you look at the patient share gains in here, they're relatively limited.

Just one question on livestock.

Hum for derm declining on a year and the cumulative effect of those as we got into this quarter, we've seen that impact in terms of Ah patient starts exactly when we will see those turnaround I won't venture to to give you here, but we are assuming the macro continues into the fourth quarter certainly what you see in fact in here and we will.

That's a very strong quarter.

Are these.

As you look ahead to 2026.

Yeah, we're very very pleased with double digit growth in livestock on the quarter.

Stock has now demonstrated growth above market. The last few years is the third year in a row and we are anticipating that continuing.

All of the bills in terms of what that means in terms of guidance in February one last point I will give is as you factor these trends.

In terms of our growth in next year I need the underlying demand picture and livestock and if you look at the secular trends that are driving that are sustainable.

Trends again very encouraging to see.

Well, Oh, showing signs of stabilization and so on those are areas that we are looking forward to as we enter into 'twenty 'twenty six but just one last point in terms of the guidance very pleased if you look at the disciplined execution from our expense management perspective, not only in terms of the performance on the quarter with 12% growth in adjusted diluted EPS, but we will maintain.

You know you see increased demand for protein you see population growth as well as.

Growth in emerging middle class.

As well as urbanization are driving these trends globally and again, we're very pleased to see the performance that on in the quarter. I think this demonstrates one of our core strengths with the diversification across the portfolio.

Kristin Peck: Now, as we look at Q4, we are factoring in a full launch of competitive product in Europe coming in with Numelvy, which started in the third quarter. So we are anticipating that, and that's factored into our guidance, certainly. Nowhere yet in terms of exactly when the Merck approval will be in the US. As they have said, that they expect an approval late this year or early next year. So that's not really a potential topic here as we exit the year. However, the competitive, again, piece isn't significantly different. I think the difference here, Chris, is truly what is the impact of therapeutic visits, which were up the last few years, even as overall visits were down, that turned this year where we're seeing therapeutic visits for derm declining on the year.

A double digit growth in livestock in a quarter, where you see some headwinds in terms of macro particularly in U S.

Our guidance from an EPS perspective in terms of bottom line for the year versus the guidance that we gave back in August again. These elements that I want to remind you of kind of Christina on Saturday and now the only thing I'll build on with regards to Labella is you know umbrella remains widely used with over 30 million doses distributed globally and we do remain confident.

Companion animal and again this is what makes this a great in terms of if you look at our portfolio and the breadth of it across species and across therapeutic areas et cetera.

We'll go next now to Nevada tie at BNP Paribas.

And the brands growth potential.

I think executing on a multi pronged strategy as you know and we're starting to see the signs of stabilization right now it gives us confidence that the actions, we're taking are going to return the relative growth and.

Hi, Thanks for taking my question.

I'm on the derm portfolio, if you could quantify.

How much is due to distributor inventory dynamic versus the competitive pressure from Zen with yard and new Malvine Europe and also on library, when do you see signs of stabilization and what other drivers.

We mentioned, we believe will return to growth in 2020 so.

What gives us that confidence just watching the trends over the last few.

Kristin Peck: And the cumulative effect of those, as we got into this quarter, we're seeing that impact in terms of patient starts. Exactly when we will see those turn around, I won't venture to give you here, but we are assuming the macro continues into the fourth quarter, certainly, which you see impacting here. And we will update those in terms of what that means in terms of guidance in February. One last point I will give is, as we factor these trends, again, very encouraging to see Librela showing signs of stabilization and so on. Those are areas that we are looking forward to as we enter into 2026. But just one last point in terms of the guidance.

A few months ago, we love what we're trying to four to six weeks at a time rolling.

Is that in your view.

That's what gives us confidence that we'll see stabilizing and will return to growth in 2026.

Thank you.

Yeah, sure really distributor inventory levels were not a point.

I think it's really strong execution across our multi pronged strategy.

To really raise here other than as we said in the prepared commentary, we did move applicable into distribution on a quarter of.

Thank you. We'll go next now to ski Steve Scala at TD Securities.

Thank you this is Chris on for Steve.

That was about a 10 million dollar contribution if you look at the figures in the U S. But there's not a point here in terms of distribution impact to speak of in terms of overall performance and again with respect to familiar both in the U S and across international markets.

Just one question on livestock.

No, it's a very strong quarter.

So let's look ahead to 2026.

Yeah, we're very very pleased with double digit growth in livestock on the quarter.

Kristin Peck: Very pleased, if you look at the discipline execution from an expense management perspective, not only in terms of the performance on the quarter with 12% growth in adjusted diluted EPS, but we are maintaining our guidance from an EPS perspective in terms of bottom line for the year versus the guidance that we gave back in August. Again, these are elements that I want to remind you of, as Kristin was adding. No, the only thing I'll build on with regards to Librela is Librela remains widely used with over 30 million doses distributed globally, and we do remain confident in Librela's growth potential. I think executing on our multi-pronged strategy, as we're starting to see the signs of stabilization right now, it gives us confidence that the actions we're taking are going to return Librela to growth.

Stock has now demonstrated growth above market. The last few years. This is the third year in a row and we are anticipating that.

Level of patient share that they're gaining here is.

As you know certainly in line with our expectations if not below it so.

So we don't see that really being a key factor that's different from what we came into the year with and it's been limited in terms of the impact.

Continuing.

In terms of growth into next year, I think the underlying demand picture and livestock and if you look at the secular trends that are driving that are sustainable.

I'll turn over to Christine on the older brother question, Yeah, I mean, I'll just reiterate we're encouraged that we've seen the recent signs of sequential stabilization and that really gives us confidence is the actions. We're taking are working and that's what gives us confidence on it will return to growth for 2026.

You see increased demand for protein you see population growth as well as growth.

Growth in emerging middle class.

Urbanization are driving these trends globally and again, we're very pleased to see the performance in the quarter I think this demonstrates one of our core strengths with the diversification across the portfolio.

We'll go next to Daniel Clark of Leerink partners.

Have a double digit growth in livestock in a quarter, where you see some headwinds in terms of macro particularly in U S. A.

Great. Thanks. Good morning, just wanted to circle back on some guidance you gave last quarter on double digit growth across the derm.

Kristin Peck: And as we mentioned, we believe it will return to growth in 2026. So what gives us that confidence is watching the trends over the last few months. We look over trends of four to six weeks at a time rolling, and that's what gives us confidence that it will be stabilizing and will return to growth in 2026. I think it's really strong execution across our multi-pronged strategy. Thank you. We'll go next now to Steve Scala at TD Securities. Thank you. This is Chris on for Steve. Just one question on livestock. We had a very strong quarter. How durable are these growth drivers as you look ahead to 2026? Yeah, we're very pleased with double-digit growth in livestock on the quarter. Livestock has now demonstrated growth above market the last two years. This is the third year in a row.

Companion animal and again this is what makes our zeolite is so great in terms of if you look at our portfolio and the breadth of it across species and across therapeutic areas et cetera.

Trio in OA pain franchises, how is that tracking at this point and how should we kind of think about.

The growth of those three going forward you know given all the dynamics you you've laid it on the call. Thank you.

We'll go next now to Nevada tie at BNP Paribas.

Yeah, Daniel are happy to take that.

Hi, Thanks for taking my question.

We came into the year and you've seen our key franchises that includes derm.

One on the derm portfolio, if you could quantify may.

Maybe how much is due to distributor inventory dynamic versus the competitive pressure from the <unk> yard and new Malvine Europe and also on library when do you see signs of that.

Person decides it's in Paris, as well as the Berlin or pain are driving a double digit growth for the year and through the first three quarters.

Even with the headwinds we've seen from all your opinion, particularly in the U S.

He's nation and what other drivers of that in your view.

Thank you.

Tracking to about 9% on a year to date basis, they were about 2% on the quarter.

Yeah sure.

Really distributor inventory levels were not a point to really raise here other than as we said in the prepared commentary we did move applicable into distribution on a quarter that was about a 10 million dollar contribution if you look at the Durham.

So we now expect those key franchises to.

Kristin Peck: And we are anticipating that continuing in terms of growth in next year. I think the underlying demand picture in livestock, and if you look at the secular trends that are driving that, are sustainable. You see increased demand for protein. You see population growth, as well as growth in emerging middle class, as well as urbanization driving this trend globally. And again, we're very pleased to see the performance not only in the quarter. I think this really demonstrates one of our core strengths, which is diversification across the portfolio. You have a double-digit growth in livestock in a quarter where you see some headwinds in terms of macro, particularly in US. Companion animal. And again, this is what makes Zoetis great in terms of, if you look at our portfolio and the breadth of it across species and across therapeutic areas, et cetera.

To be high single digits on a year.

I won't again, I won't venture into what our forecast might be as we go into next year, we'll provide more clarity on those in February or certainly we look forward to that.

In the U S, but there's not a point here in terms of distribution impact to speak of in terms of overall performance and again with respect to familiar both in the U S and across international markets.

I would say again the stabilization we've seen a lot of pain.

It's certainly helpful to see if you look at the OA pain in terms of the impact on the quarter. Certainly you can see how that plays out, particularly in these key franchise areas, but it is encouraging to see the stabilization in terms of Isabella into the therapeutic business that we talked about those have been down for the last three quarters, but it gives a derm for.

Level of patient share that they're gaining here is.

Certainly in line with our expectations if not below it.

So we don't see that really being a key factor that's different from what we came into the year with and it's been limited in terms of the impact I'll turn over to Christine on the Liberty Bush, Yeah, I mean, I'll just reiterate we're encouraged that we've seen the recent signs of sequential stabilization and that really gives us confidence is the actions. We're taking are working in Africa.

Temple visits for therapeutics in Durham, and the U S clinics were down.

Less than 1% down where there they were down more in the last couple of quarters. So we are encouraged by some of those again not necessarily forecasting what.

The macro would look like if you look at it.

Kristin Peck: We'll go next now to Navann Ty at BNP Paribas. Hi, thanks for taking my questions. One on the derm portfolio, if you could quantify. Maybe how much is due to distributor inventory dynamics versus the competitive pressure from Zenrelia and Numelvy in Europe. And also on Librela, when do you see signs of stabilization, and what are the drivers of that in your view? Thank you. Yeah, sure. Really, distributor inventory levels were not a point to really raise here, other than, as we said in the prepared commentary, we did move Apoquel into distribution on the quarter. That was about a $10 million contribution if you look at the derm figures in the US. But there's not a point here in terms of distribution impact to speak of in terms of overall performance.

This confidence on it will return to growth for 2026.

We'll go next now to Andrea Alfonso with UBS.

We'll go next now to Daniel Clark of Leerink partners.

Hi, everyone. Thanks, so much for taking the question I wanted to just.

Great. Thanks. Good morning, just wanted to circle back on some guidance you gave last quarter on double digit growth across the derm.

Just probe a little bit more disappearing trio franchise in the U S. In the corner I'll tell you the tough comp I guess would be curious if you could provide any color on the actual doses share in that clinics are particularly among new puppies did you retain or cede some share.

Trio in OA pain franchises, how is that tracking at this point and how should we kind of think about the growth of those three going forward you know given all the dynamics you you've laid out on the call. Thank you.

And also curious if you could speak to maybe some of the pricing spreads versus the competitors have been narrow in some of those new launches.

Yeah, Daniel are happy to take that.

We came into the year and you've seen our key franchises that includes derm.

And then.

The person who says it's in Paris, as well as the Berlin or pain are driving a double digit growth for the year and through the first three quarters.

Separately, but sort of at the same topic is in one of your slides at the Investor Day. There was some mention as new canine parasiticide in the innovation Road map slide. So just curious at all if you can comment or does simply long acting maybe any new efficacy and breadth that you expect to roll out there. Thanks, so much.

Kristin Peck: And again, with respect to Zenrelia, both in the US and across international markets, the level of patient share that they're gaining here is certainly in line with our expectations, if not below it. So we don't see that really being a key factor that's different from what we came into the year with. And it's been limited in terms of the impact. I'll turn it over to Kristin on the Librela question. Yeah, I mean, I'll just reiterate. We're encouraged that we've seen the recent signs of sequential stabilization, and that really gives us confidence that the actions we're taking are working. And that's what gives us confidence that we'll return to growth in 2026. We'll go next now to Daniel Clark of Leerink Partners. Great, thanks. Good morning.

Even with the headwinds we've seen from or opinion, particularly in the U S.

You're tracking to about 9% on a year to date basis, they were about 2% on the quarter.

And so we now expect those key franchises to be high single digits on a year I.

Yeah, I'll take the overall question and see if Christian one wants to chime in on.

I won't again, I won't venture into what our forecast might be as we go into next year, we will provide more clarity on those in February or certainly we look forward to that.

The pipeline here as we look at trio I know you said, despite the tough comp, but I do think that is probably the biggest factor here. In addition to the macro that we've already talked about if you look at where trio performed a year ago in the third quarter two was up 27%.

I would say again the stabilization, we're seeing a lot of pain.

It's certainly helpful to see if you look at the OA pain in terms of the impact on the quarter. Certainly you can see how that played out particularly on these key franchise areas, but it is encouraging to see the stabilization in terms of Isabella into the therapeutic business that we talked about those have been down for the last three quarters, but it gives a derm for it.

On the quarter. So I think clearly that is a very strong.

Comparator period in a strong performance. So I think we're up against and we knew that in coming in which is why we factored some of that in but I do think it's important in terms of share we are largely maintaining our share across.

Kristin Peck: Just wanted to circle back on some guidance you gave last quarter on double-digit growth across the derm trio and OA pain franchises. How is that tracking at this point, and how should we kind of think about the growth of those three going forward, given all the dynamics you've laid out on the call? Thank you. Yeah, Daniel, happy to take that. Look, we came into the year, and you've seen our key franchises that includes derm, parasiticides with Simparica, as well as Librela and OA pain driving double-digit growth for the year. And through the first three quarters, even with the headwinds we've seen from OA pain, particularly in the US, they're tracking to about 9% on a year-to-date basis. They're about 2% on the quarter. We now expect those key franchises to be high single-digit on the year.

Example of visits for therapeutics in Durham, and the U S clinics were down less than 1% down where they are they were down more in the last couple of quarters. So we are encouraged by some of those again not necessarily forecasting what the macro would look like as you look at it.

The vacuum and I think the reduction in our flea tick heartworm visits that we're seeing from a therapeutic category perspective is part of the impact here, but again the competitive share gains from a patient share perspective that we're seeing here are not significant.

Significantly again, they've been limited here, we are continuing to see expansion, though of the overall flea tick heartworm, particularly a triple combination space. As you look ahead and so there is still significant room to grow here over the last couple of years, you've seen that share of whats good prescribed.

We'll go next now to Andrea Alfonso with UBS.

Hi, everyone. Thanks, so much for taking the question I wanted to just.

Just probe a little bit more on this empirical trail franchise in the U S. In the corner outside of a tough comp I guess would be curious if you could provide any color on the actual doses share in that clinics are particularly among the puppies did you retain or or cede some share.

Prescribed medications go from 30% to 47% over the last few years with substantial more room to grow and trio is the market leader here certainly.

Certainly in the U S.

And also curious if you could speak to maybe some of the pricing spreads versus the competitors have they narrow in some of those new launches and then.

We continue to see opportunity to continue capitalize on that as the first mover and very very high satisfaction rates are.

Kristin Peck: Again, I won't venture into what the forecast might be as we go into next year. We'll provide more clarity on those in February. Certainly, we look forward to that. However, I would say, again, the stabilization we're seeing in OA pain is certainly helpful to see. If you look at the OA pain in terms of the impact on the quarter, certainly you can see how that played out, particularly in these key franchise areas. But it is encouraging to see the stabilization in terms of Librela and to the therapeutic visits that we talked about. Those have been down for the last three quarters. But if you look at derm, for example, visits for therapeutics in derm in the US clinics were down less than 1%, down, where they were down more in the last couple of quarters.

From a customer's here won't get into the specifics in terms of pricing spreads here again, there are some dynamics that we anticipate in terms of what happens during a period of launch historically those have been short lived and we won't get too deep into those other than to say, we're confident in our position across all products was off in the differentiation.

Separately, but sort of at the same topic is in one of your slides at the Investor Day. There was some mention as new canine parasiticide in the innovation roadmap slide. So just curious at all if you can comment are there simply long acting maybe any new efficacy and breadth that you expect to roll out there. Thanks, so much.

That we have across our products and that gives us a reason to be very disciplined as we cycle through those periods. Yeah. I'll just build on your second question, we would have to do with the pipeline.

Yeah I'll take the overall question and see if Christian woman wants to chime in on the pipeline here look at as we look at trio I know you said, despite the tough comp, but I do think that is probably the biggest factor here.

I said before we're really excited to be continuing to deliver on our commitments across our pipeline I think youre referencing a fly from J P. Morgan presentation, we continue to be on or ahead of schedule with them over a pipeline and we look forward to providing very specific updates on the progress of that pipeline, including Arcanine parents, which remain in.

Kristin Peck: So we are encouraged by some of those, again, not necessarily forecasting what the macro will look like as we look ahead. We'll go next now to Andrea Alfonso with UBS. Hi, everyone. Thanks so much for taking the question. I wanted to just probe a little bit more on this Simparica Trio franchise in the US in the quarter outside of the tough comp. I guess would be curious if you could provide any color on the actual dosage share in vet clinics, particularly among new puppies. Did you retain or cede some share? And also curious if you could speak to maybe some of the pricing spreads versus the competitors. Have they narrowed in some of those new launches?

In addition to the macro that we've already talked about if you look at where trio performed a year ago in the third quarter two was up 27%.

An important part of that pipeline on our webcast on December 2nd on innovation. So we'll give you a fulsome review of the pipeline progress in more information on it on the December 2nd about cats.

On the quarter. So I think clearly that is a very strong.

Comparator period in a strong performance that we're up against and we knew that in coming in which is why we factored some of that in but I do think it's important in terms of share we are largely maintaining our share across.

Thank you and ladies and gentlemen that is all the time, we have for questions. This morning, Mispick I'd like to turn the conference back to Ya man for any closing comments.

The vet clinic I think Oh.

Production in our facility.

Well, thanks, everyone for joining us today and for your thoughtful questions. We're proud of another solid quarter that reflects the consistency of execution and the strength of our portfolio and the focus of our colleagues around the world. As we look ahead, we will continue to advance our strategy and invest in innovation that is driving our sustainable growth and as always we remain committed to delivering long.

Clitic Heartware and visits that we're seeing from a therapeutic category perspective is part of the impact here, but again the competitive share gains from a patient share perspectives up sitting here or.

Not significantly limited our fear you are continuing to see expansion of the overall fleet.

Particularly a triple combination with speed as we look ahead and so there's still significant room to grow here over the last couple of years, you've seen that sheer of prescribed or medications go from 30% to 47% over the last two years.

Kristin Peck: And then separately, but sort of at the same topic, is in one of your slides of the investor deck, there was some mention of new canine parasiticides in the innovation roadmap slide. So just curious at all if you can comment, are those simply long-acting, maybe any new efficacy and breadth that you expect to roll out there? Thanks so much. Yeah, I'll take the overall question and see if Kristin wants to chime in on the pipeline here. Look, as we look at the trio, I know you said despite the tough comp, but I do think that is probably the biggest factor here in addition to the macro that we've already talked about. If you look at where trio performed a year ago in the third quarter, trio was up 27% on the quarter.

Term value for our shareholders and look forward to sharing continued progress on our innovation pipeline during the upcoming innovation webcast and we look forward to speaking to that and have a great day everybody.

Thank you very much Ms Peck and thank you Mr. Joseph again, ladies and gentlemen, this will bring us to the conclusion of <unk> third quarter 2025 financial results conference call again, thanks, so much for joining US everyone and we wish you all a great day Goodbye.

With substantial more room to grow and trio is the market leader here.

Certainly in the U S and we continue to see opportunity to continue capitalizing on that as the first mover and very very high satisfaction rates.

From a customer's here won't get into the specifics in terms of pricing spreads here again, there are some dynamics that we anticipate in terms of what happens during a period of launch.

Historically those have been short lived and we won't get too deep into those other than to say, we're confident in our position we're confident in our products and the differentiation.

Kristin Peck: So I think clearly that is a very strong comparative period and strong performance that we're up against. And we knew that in coming in, which is why we factored some of that in. But I do think it's important. In terms of share, we are largely maintaining our share across the vet clinic. I think the reduction in flea-tick heartworm visits that we're seeing from a therapeutic category perspective is part of the impact here. But again, the competitive share gains from a patient share perspective that we're seeing here are not significant. Again, they've been limited here. We are continuing to see expansion, though, of the overall flea-tic heartworm, particularly triple combination space as we look ahead. And so there's still significant room to grow here.

Differentiation that we have across our products and that gives us a reason to be very disciplined as we cycle through those periods. Yeah. I'll just build on your second question would have to do with the pipeline as I mentioned before.

Really excited to be continuing to deliver on our commitments across our pipeline I think youre referencing a fly from J P. Morgan presentation, we continue to be on or ahead of schedule, we think over our pipeline and we look forward to providing very specific updates on the progress of that pipeline, including Arcanine parents, which remain an important part of that pipeline.

On our webcast on December 2nd on innovation. So we'll give you a fulsome review of the pipeline progress in more information on it on the December 2nd Love Cats.

Thank you and ladies and gentlemen that is all the time, we have for questions. This morning, Ms. Peck I'd like to turn the conference back to Ya man for any closing comments.

Kristin Peck: Over the last couple of years, you've seen that share of prescribed oral medications go from 30% to 47% over the last two years, with substantial more room to go. And Trio is the market leader here, certainly in the US. And we continue to see our opportunity to continue to capitalize on that as a first mover and very, very high satisfaction rates from customers here. We'll get into the specifics in terms of pricing spreads here. Again, there are some dynamics that we anticipate in terms of what happens during the period of launch. Historically, those have been short-lived, and we won't get too deep into those other than to say we're confident in our position. We're confident in our product. We're confident in the differentiation that we have across our products. And that gives us a reason to be very disciplined as we cycle through those periods.

Well, thanks, everyone for joining us today and for your thoughtful questions. We're proud of another solid quarter that reflect the consistency of execution and the strength of our portfolio and the focus of our colleagues around the world. As we look ahead, we will continue to advance our strategy and invest in innovation that is driving our sustainable growth and as always we remain committed to delivering long term.

Value for our shareholders and look forward to sharing continued progress on our innovation pipeline during the upcoming innovation webcast I would look for.

So you can do that and have a great day everybody.

Kristin Peck: Yeah, I'll just build on your second question, which had to do with the pipeline. As I mentioned before, we're really excited to be continuing to deliver on our commitments across our pipeline. I think you're referencing a slide from our JPMorgan presentation. We continue to be ahead of schedule with the overall pipeline. And we look forward to providing very specific updates on the progress of that pipeline, including our canine parvo, which remain an important part of that pipeline, on our webcast on 2 December 2025 on innovation. So we'll give you a fulsome review of the pipeline progress and more information on it on the 2 December 2025 webcast. Thank you. And ladies and gentlemen, that is all the time we have for questions this morning. Ms. Peck, I'd like to turn the conference back to you, ma'am, for any closing comments.

Hum.

Hmm.

[music].

Oh.

Kristin Peck: Well, thanks, everyone, for joining us today and for your thoughtful questions. We're proud of another solid quarter that reflects the consistency of execution and the strength of our portfolio and the focus of our colleagues around the world. As we look ahead, we'll continue to advance our strategy and invest in innovation that is driving our sustainable growth. And as always, we remain committed to delivering long-term value for our shareholders and look forward to sharing continued progress on our innovation pipeline during the upcoming innovation webcast. I will look forward to speaking to you then. Have a great day, everybody. Thank you very much, Ms. Peck. And thank you, Mr. Joseph. Again, ladies and gentlemen, this will bring us to the conclusion of Zoetis's third quarter 2025 financial results conference call. Again, thanks so much for joining us, everyone, and we wish you all a great day. Goodbye.

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