Gilead Sciences Lifts Annual Outlook As Yeztugo Launch Nears

Gilead Sciences reported strong Q2 2025 results, with adjusted EPS of $2.01 and revenue of $7.08 billion, both exceeding consensus estimates, primarily driven by robust sales growth in key HIV therapies Biktarvy (+9%) and Descovy (+35%). The company raised its full-year 2025 adjusted EPS and sales guidance, signaling confidence in its outlook despite a lowered Veklury sales forecast and declines in Cell Therapy. This positive performance, alongside the authorization of a new $6.0 billion stock repurchase program, spurred analyst upgrades and a significant 9% increase in GILD's stock price.

Analysis

Gilead Sciences delivered a robust second-quarter 2025 performance, exceeding consensus estimates with an adjusted EPS of $2.01 and revenue of $7.08 billion. The core driver of this outperformance was the HIV franchise, where Biktarvy sales grew 9% to $3.5 billion and Descovy sales surged 35% to $653 million, fueled by strong demand and favorable pricing. This strength in the core business, along with a 14% increase in Trodelvy sales, successfully offset a predictable 44% decline in Veklury revenue and a more concerning 7% contraction in the Cell Therapy unit attributed to competitive headwinds. Critically, the company raised its full-year 2025 guidance for both adjusted EPS (to $7.95-$8.25) and total sales (to $28.3-$28.7 billion), a move made even more impressive by the simultaneous downward revision of its Veklury sales outlook by $400 million. This highlights significant momentum in the underlying portfolio. The positive operational results are further supported by a new $6.0 billion share repurchase authorization and an improved non-GAAP product gross margin of 86.9%, leading to a sharp 9.07% rise in the stock price and a notable upgrade from Truist Securities.

Key Decisions for Investors

• Investors should view the raised full-year guidance as a strong bullish signal, as it demonstrates significant underlying strength in the core HIV portfolio that more than compensates for the anticipated decline in Veklury sales.
• The new $6.0 billion share repurchase authorization is a key catalyst that signals management's confidence in the current valuation and enhances the total return proposition for shareholders.
• It is prudent to closely monitor the Cell Therapy division's performance, as its 7% sales decline due to competitive pressures represents the primary weakness in an otherwise strong report and a potential risk to sustained growth.