Novartis AG (NVS) Earnings Date & Reports

Novartis reported net sales of $13,113 million for Q1 2026, a 1% decline on a reported basis and 5% in constant currency (cc, which adjusts for foreign exchange impacts) from $13,233 million in Q1 2025. This missed Wall Street consensus of around $13.5 billion, primarily due to a 14 percentage point drag from U.S. generics, partially offset by 13 points of volume growth from priority products and pricing dynamics.

Core EPS was $1.99, down 13% reported and 15% cc from $2.28, falling short of the $2.10 estimate. GAAP EPS stood at $1.65, down 10% reported. Core operating income declined 12% to $4,897 million (margin 37.3%, down 4.8 percentage points), reflecting lower sales and higher R&D investments.

Key metrics showed strength in innovative portfolio: Top 20 brands sales at $10,763 million (-3% cc). Standouts included Kisqali ($1,516 million, +55% cc), Pluvicto ($642 million, +70% cc), Kesimpta ($1,164 million, +26% cc), Leqvio ($452 million, +69% cc), and Scemblix ($433 million, +79% cc). Entresto sales dropped 46% cc to $1,305 million due to generics. Guidance for FY 2026 was reaffirmed unchanged.

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Market Reaction and Investor Sentiment

Following the Q1 release on April 28, 2026, Novartis shares traded lower, closing down approximately 0.9% at $144.18 amid pre-market weakness. The reaction reflected investor disappointment over the revenue and core EPS misses, despite beats in free cash flow and positive pipeline updates. Sentiment remains cautious heading into the year, with focus on generic erosion, but reaffirmed guidance provided some reassurance. Analysts noted the resilience of growth brands as a bright spot.

Forward Outlook and Key Factors to Monitor

With FY 2026 guidance intact—net sales low single-digit cc growth and core operating income low single-digit cc decline—investors should track execution on priority brands like Kisqali and Pluvicto, which are expected to drive momentum.

Pipeline catalysts loom large, including Phase III readouts for remibrutinib in chronic inducible urticaria (positive data already shared) and food allergy trials starting H2 2026. Fabhalta's Phase III results in IgA nephropathy (showing 49% eGFR decline reduction) could support label expansions. Regulatory milestones for ianalumab in Sjogren's disease and Cosentyx in pediatric hidradenitis suppurativa are also key.

U.S. generic pressures on Entresto and others will persist, but new launches like Rhapsido and Avidity assets in neuromuscular diseases offer offsets. Monitor R&D spend trends, margin recovery, and M&A integration (M&A: mergers and acquisitions). Free cash flow supports $10 billion share repurchase program. Broader dynamics include China access gains (e.g., Leqvio NRDL) and global pricing.

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