MRK's 2027 Outlook Challenging, Long-Term Prospects Promising

Merck reported Q3 2026 sales of $18.1 billion, up 5% year over year, and adjusted EPS of $2.49, down 3%; it raised 2026 guidance to $66.8-$67.3 billion in revenue and $2.77-$2.82 adjusted EPS. The company expects more than $2 billion in generic headwinds in 2027, while Keytruda biosimilar competition is anticipated around 2028-2029 and could sharply reduce its sales. Merck sees more than $70 billion in potential non-risk-adjusted pipeline commercial opportunity by the mid-2030s, though development and post-Keytruda recovery remain uncertain.