Days after it announced a massive business overhaul, Novartis (NVS) stock is down after the pharmaceutical company saw weaker-than-expected earnings.
NVS reported $14.02 billion in first-quarter sales, with analysts’ average estimates being $14.25 billion.
Its pharmaceutical division also saw a 1% drop in sales. Novartis said the loss was in part due to generic drug competition for its bone repair drug Zometa, and sales declines for some of its leukemia and cancer drugs.
Novartis also reported a 24 percent jump in first-quarter net profit to $2.97 billion, beating analysts’ mean estimate of $2.7 billion. The figure was boosted by higher operating income which included a $900 million pretax gain from the divestment of its diagnostics unit to Spain’s Grifols last November.
Core earnings per share rose 1 percent to $1.31, in line with expectations and blunted by the stronger Swiss franc and weaker emerging market currencies.
NVS stock is down 2.4% in early morning trading, and down 1.9% year to date.
Earlier this week Novartis announced a business model change with multibillion-dollar deals with GlaxoSmithKline (GSK) and Eli Lilly & Co (LLY).
The partnerships work to assist each company as the industry rapidly looks to mergers and deals as a way to boost business strength in the pharmaceutical arena.
