GILEAD SCIENCES, INC. (GILD): Results of Operations and Financial Condition
GILEAD SCIENCES, INC. (GILD) filed an SEC Form 8-K — Results of Operations and Financial Condition. GILEAD SCIENCES ANNOUNCES SECOND QUARTER 2026 FINANCIAL RESULTS Product Sales Excluding Veklury Increased 10% Year-Over-Year to $7.6 billion Biktarvy Sales Increased 7% Year-Over-Year to $3.8 billion Diluted Loss Per Share was $(8.45) and Non-GAAP Diluted Loss Per Share was $(6.7
How this was made
The 30-second read
Why it matters
The filing discloses both operating momentum (HIV and select oncology/liver products) and major financial statement impacts from acquisition-related IPR&D, plus a significant cash balance decline and ongoing capital returns (dividends and buybacks).
Market read
Traders can update positioning based on the disclosed Q2 revenue/product drivers, the magnitude of acquisition-related IPR&D charges, and the cash balance trajectory.
What to watch
Cash fell sharply to $3.2B at June 30, 2026 due to acquisitions and debt repayments, which could matter more than the income statement for medium-term risk pricing.
GILEAD SCIENCES ANNOUNCES SECOND QUARTER 2026 FINANCIAL RESULTS
Total revenues increased 10% to $7.8 billion and product sales excluding Veklury increased 10% to $7.6 billion, led by HIV, Trodelvy and Livdelzi. However, acquired IPR&D expenses of $11.2 billion drove diluted loss per share of $(8.45), while Cell Therapy and Veklury sales declined.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenuesGAAP | $7.8 billion | – | increased 10% |
| Product salesGAAP | $7.6 billion | – | increased 8% |
| Product sales excluding VekluryGAAP | $7.6 billion | – | increased 10% |
| Diluted (loss) earnings per shareGAAP | $(8.45) | – | – |
| Non-GAAP diluted (loss) EPSnon-GAAP | $(6.75) | – | – |
| Product gross marginGAAP | 79.3% | – | – |
| Non-GAAP product gross marginnon-GAAP | 86.9% | – | – |
| Research and development expensesGAAP | $1.8 billion | – | – |
| Non-GAAP research and development expensesnon-GAAP | $1.4 billion | – | – |
| Acquired IPR&D expensesGAAP | $11.2 billion | – | – |
| Selling, general and administrative expensesGAAP | $1.9 billion | – | – |
| Non-GAAP selling, general and administrative expensesnon-GAAP | $1.5 billion | – | – |
| Effective tax rateGAAP | (2.4)% | – | – |
| Non-GAAP effective tax ratenon-GAAP | (11.4)% | – | – |
| Operating cash flowGAAP | $3.6 billion | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| HIV product salesHigher average realized price and demand. | $5.7 billion | – | increased 12% |
| Biktarvy salesHigher average realized price, favorable inventory dynamics and higher demand. | $3.8 billion | – | increased 7% |
| Descovy salesHigher average realized price and demand. | $967 million | – | increased 48% |
| Liver Disease portfolio salesHigher demand for Livdelzi, as well as chronic hepatitis B virus products and Hepcludex, partially offset by lower sales for HCV products. | $877 million | – | increased 10% |
| Veklury salesLower rates of COVID-19-related hospitalizations. | $23 million | – | decreased 81% |
| Cell Therapy product salesOngoing competitive headwinds. | $417 million | – | decreased 14% |
| Yescarta salesIn- and out-of-class competition. | $346 million | – | decreased 12% |
| Tecartus salesIn-class competition. | $70 million | – | decreased 24% |
| Trodelvy salesHigher demand. | $457 million | – | increased 26% |
full year 2026 outlook
- RevenueProduct sales: $30,100 to $30,400; Product sales excluding Veklury: $29,800 to $30,100
- NoteVeklury: ~ $300
- NoteDiluted loss per share: $ (3.75) to $ (3.40)
- NoteNon-GAAP diluted loss per share: $ (0.65) to $ (0.30)
- NoteFull year 2026 GAAP and non-GAAP diluted loss per share guidance includes the impact of approximately $9.08 due to acquired IPR&D charges of $11.1 billion related to the Arcellx, Tubulis and Ouro Medicines transactions, net of the impact of the Lakefront collaboration and related taxes.
Capital returns
- During the second quarter 2026, Gilead paid dividends of $1.0 billion.
- During the second quarter 2026, Gilead repurchased $355 million of common stock.
- Year-to-date cash outflows included $2.1 billion of dividend payments and $774 million of common stock repurchases.
What drove it
- Higher sales of HIV products, Trodelvy and Livdelzi.
- Higher royalty, contract and other revenues related to a previous sale of intellectual property.
- HIV growth reflected higher average realized price and demand.
- Trodelvy sales increased 26% to $457 million, primarily driven by higher demand.
- Liver Disease portfolio growth reflected higher demand for Livdelzi, chronic hepatitis B virus products and Hepcludex.
- The company received FDA approval of Trodelvy for first-line treatment of adult patients with unresectable locally advanced or metastatic triple-negative breast cancer in specified settings.
- The company received FDA accelerated approval for Hepcludex for chronic hepatitis delta virus infection in adults without cirrhosis or with compensated cirrhosis.
Concerns
- Acquired IPR&D expenses were $11.2 billion, primarily related to the Arcellx, Tubulis and Ouro Medicines acquisitions, net of the impact of the Lakefront collaboration.
- Diluted (loss) earnings per share was $(8.45), compared to $1.56 in the same period in 2025.
- Cell Therapy product sales decreased 14% to $417 million, reflecting ongoing competitive headwinds.
- Veklury sales decreased 81% to $23 million, primarily driven by lower rates of COVID-19-related hospitalizations.
- The Phase 3 EVOKE-03 study of Trodelvy in combination with Keytruda for investigational first-line metastatic non-small cell lung cancer with high PD-L1 expression was discontinued.
- GAAP R&D and SG&A expenses increased due to integration costs and other acquisition-related expenses.
What to watch
- Full year 2026 product sales guidance of $30,100 to $30,400.
- Full year 2026 product sales excluding Veklury guidance of $29,800 to $30,100.
- Full year 2026 Veklury guidance of ~ $300.
- Full year 2026 diluted loss per share guidance of $ (3.75) to $ (3.40).
- Full year 2026 non-GAAP diluted loss per share guidance of $ (0.65) to $ (0.30).
- FDA target action date of February 2, 2027 for the supplemental New Drug Application for Yeztugo 300-mg tablets as a potential once-weekly oral formulation for HIV PrEP.
- Commercial execution following the FDA approval of Trodelvy in first-line metastatic triple-negative breast cancer.
- Competitive trends in Cell Therapy, including Yescarta and Tecartus.
Balance sheet and cash flow
- As of June 30, 2026, Gilead had $3.2 billion of cash, cash equivalents and marketable debt securities compared to $10.6 billion as of December 31, 2025.
- During the second quarter 2026, Gilead generated $3.6 billion in operating cash flow.
- Year-to-date cash outflows of $11.3 billion were related to acquisitions.
- Year-to-date debt repayments were $2.8 billion.
- Year-to-date net proceeds from debt financing were $4.1 billion.
- Year-to-date operating cash flow was $6.1 billion.
Analysis
Gilead reported second quarter 2026 total revenues of $7.8 billion, up 10%, with product sales up 8% to $7.6 billion. Product sales excluding Veklury increased 10% to $7.6 billion. Management attributed the revenue performance primarily to higher HIV product sales, Trodelvy and Livdelzi, plus higher royalty, contract and other revenues related to a previous sale of intellectual property.
HIV was the principal commercial contributor, with sales increasing 12% to $5.7 billion. Biktarvy sales increased 7% to $3.8 billion, while Descovy sales increased 48% to $967 million. Liver Disease portfolio sales increased 10% to $877 million, supported by Livdelzi, chronic hepatitis B virus products and Hepcludex. Trodelvy sales increased 26% to $457 million. These gains were partly offset by the 81% decline in Veklury sales to $23 million and a 14% decline in Cell Therapy sales to $417 million amid competitive headwinds.
Profitability was dominated by acquisition-related charges. Acquired IPR&D expenses were $11.2 billion, including $7.0 billion for Arcellx, $3.1 billion for Tubulis and $1.0 billion for Ouro Medicines, net of the impact of the Lakefront collaboration. GAAP diluted loss per share was $(8.45), and non-GAAP diluted loss per share was $(6.75). GAAP product gross margin was 79.3% versus 78.7%, while non-GAAP product gross margin was 86.9% in both periods. GAAP R&D expenses rose to $1.8 billion and GAAP SG&A expenses rose to $1.9 billion, reflecting acquisition integration costs and higher HIV promotional activities.
Cash generation remained material despite the earnings loss, with $3.6 billion of second-quarter operating cash flow and $6.1 billion year-to-date. Cash, cash equivalents and marketable debt securities were $3.2 billion as of June 30, 2026, down from $10.6 billion as of December 31, 2025. The reduction reflected $11.3 billion of acquisition cash outflows, $2.8 billion of debt repayments, $2.1 billion of dividends and $774 million of common stock repurchases, partly offset by $4.1 billion of net debt-financing proceeds.
The full-year outlook raises the low end of product sales excluding Veklury to $29,800 and lowers Veklury expectations to ~ $300. Product sales guidance is $30,100 to $30,400, while GAAP diluted loss per share guidance is $ (3.75) to $ (3.40) and non-GAAP diluted loss per share guidance is $ (0.65) to $ (0.30). The guidance incorporates approximately $9.08 of impact from acquired IPR&D charges of $11.1 billion related to the Arcellx, Tubulis and Ouro Medicines transactions, net of the Lakefront collaboration and related taxes.
Management, verbatim
Gilead delivered a very strong second quarter, with 10% year-over-year revenue growth in our base business driven by our HIV portfolio, Trodelvy and Livdelzi. HIV sales grew 12%, reflecting continued strength in treatment and the rapid expansion of our PrEP business, supporting an increase in our base business revenue expectations for 2026.
Daniel O’Day, Chairman and Chief Executive Officer
We also made significant clinical progress with three FDA approvals and three positive Phase 3 updates. We look forward to delivering on our many opportunities in the second half of the year including another two potential launches in oncology and HIV.
Daniel O’Day, Chairman and Chief Executive Officer
Not in the filing
stated, not guessed- Operating income, operating margin, net income and their prior-year comparisons were not provided in the supplied filing text.
- Free cash flow was not provided in the supplied filing text.
- Ending debt balance was not provided in the supplied filing text.
- Prior-quarter comparisons for reported financial metrics and product sales were not provided in the supplied filing text.
- Prior full-year outlook was displayed in the current release, but no actual full-year 2026 results were reported for comparison.
- Full-year 2026 gross margin, operating-expense and tax-rate guidance were not provided in the supplied filing text.
- The supplied filing text is truncated following the oncology updates and does not include the accompanying financial tables or CFO commentary, if any.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
This is Gilead’s SEC 8-K (Item 2.02) reporting second-quarter 2026 financial results and related operating metrics.
Ticker impact
Gilead reported Q2 2026 results with 10% revenue growth to $7.8B, but diluted EPS of $(8.45) driven by $11.2B acquired IPR&D charges.
Likely choppy reaction, with upside bias if investors emphasize base-business growth and oncology/HIV FDA progress, offset by concerns over earnings dilution and cash usage.
The filing provides concrete Q2 revenue/product drivers (Biktarvy, Descovy, Trodelvy, Livdelzi) and quantifies the EPS deterioration and cash decline, which can drive both positive and negative positioning into guidance.
Market effects
Biopharma investors may reprice acquisition-driven earnings volatility versus underlying growth in HIV and select oncology assets.
Limited, primarily affects US large-cap biotech sentiment and peer read-through on HIV franchise durability.
Moderate, as HIV and oncology demand signals can influence global treatment-market expectations.
Counterpoint
The headline EPS loss is heavily accounting-driven by acquired IPR&D; traders may look through charges and focus on base-business growth and FDA approvals/Phase 3 updates.
Key entities
- companyGilead Sciences, Inc.
Reported Q2 2026 revenues, product sales by franchise, EPS including acquired IPR&D impacts, and cash flow/capital return details.
- acquired companyArcellx, Inc.
Acquisition-related acquired IPR&D expense cited as a major driver of Q2 EPS deterioration.
- acquired companyTubulis GmbH
Acquisition-related acquired IPR&D expense cited as a major driver of Q2 EPS deterioration.
- acquired companyOuro Medicines, LLC
Acquisition-related acquired IPR&D expense cited as a major driver of Q2 EPS deterioration.
- collaboration counterpartyLakefront Biotherapeutics NV
Collaboration impact referenced as netting part of acquired IPR&D expense.
