Third Quarter 2026
Filed Oct 29, 2026Lilly reports third-quarter 2026 financial results, raises full-year guidance and highlights regulatory progress across the portfolio
Third-quarter revenue increased 39% to $24.4 billion, led by Mounjaro and Zepbound, while the company raised its full-year revenue range to $91 to $92 billion and performance-margin range to 52.0% to 52.5%.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Revenue, three months ended September 30, 2026GAAP | $24.40B | – | 39% |
| Revenue, nine months ended September 30, 2026GAAP | $67.17B | – | 46% |
| Cost of sales, three months ended September 30, 2026GAAP | $3.93B | – | 31% |
| Cost of sales, nine months ended September 30, 2026GAAP | $10.78B | – | 40% |
| Gross margin, three months ended September 30, 2026GAAP | $20.46B | – | 40% |
| Gross margin as a percent of revenue, three months ended September 30, 2026GAAP | 83.9% | – | 1.0 percentage points |
| Gross margin, nine months ended September 30, 2026GAAP | $56.39B | – | – |
| Gross margin as a percent of revenue, nine months ended September 30, 2026GAAP | 84.0% | – | – |
| Research and development, three months ended September 30, 2026GAAP | $4.25B | – | 23% |
| Research and development, nine months ended September 30, 2026GAAP | $11.58B | – | 21% |
| Marketing, selling, and administrative, three months ended September 30, 2026GAAP | $3.13B | – | 14% |
| Marketing, selling, and administrative, nine months ended September 30, 2026GAAP | $9.49B | – | 19% |
| Acquired IPR&D, three months ended September 30, 2026GAAP | $4.18B | – | NM |
| Acquired IPR&D, nine months ended September 30, 2026GAAP | $7.54B | – | NM |
| Asset impairment, restructuring and other special charges, three months ended September 30, 2026GAAP | $303M | – | (17)% |
| Asset impairment, restructuring and other special charges, nine months ended September 30, 2026GAAP | $1.28B | – | NM |
| Operating income, three months ended September 30, 2026GAAP | $8.61B | – | 17% |
| Operating income, nine months ended September 30, 2026GAAP | $26.50B | – | 48% |
| Net interest income (expense), three months ended September 30, 2026GAAP | −$316M | – | – |
| Net interest income (expense), nine months ended September 30, 2026GAAP | −$843M | – | – |
| Net other income (expense), three months ended September 30, 2026GAAP | $114M | – | – |
| Net other income (expense), nine months ended September 30, 2026GAAP | $845M | – | – |
| Other income (expense), three months ended September 30, 2026GAAP | −$202M | – | 53% |
| Other income (expense), nine months ended September 30, 2026GAAP | $2M | – | (100)% |
| Income before income taxes, three months ended September 30, 2026GAAP | $8.41B | – | 16% |
| Income before income taxes, nine months ended September 30, 2026GAAP | $26.50B | – | 52% |
| Income tax expense, three months ended September 30, 2026GAAP | $1.96B | – | 18% |
| Income tax expense, nine months ended September 30, 2026GAAP | $5.56B | – | 61% |
| Effective tax rate, three months ended September 30, 2026GAAP | 23.3% | – | – |
| Effective tax rate, nine months ended September 30, 2026GAAP | 21.0% | – | – |
| Net income, three months ended September 30, 2026GAAP | $6.45B | – | 16% |
| Net income, nine months ended September 30, 2026GAAP | $20.94B | – | 50% |
| Earnings per share - diluted, three months ended September 30, 2026GAAP | $7.22 | – | 16% |
| Earnings per share - diluted, nine months ended September 30, 2026GAAP | $23.42 | – | 51% |
| Weighted-average shares outstanding (thousand) - diluted, three months ended September 30, 2026GAAP | 893.4M | – | – |
| Weighted-average shares outstanding (thousand) - diluted, nine months ended September 30, 2026GAAP | 894.4M | – | – |
| Gross margin, three months ended September 30, 2026non-GAAP | $20.59B | – | 40% |
| Gross margin as a percent of revenue, three months ended September 30, 2026non-GAAP | 84.4% | – | 0.8 percentage points |
| Gross margin, nine months ended September 30, 2026non-GAAP | $56.77B | – | – |
| Gross margin as a percent of revenue, nine months ended September 30, 2026non-GAAP | 84.5% | – | – |
| Net income, three months ended September 30, 2026non-GAAP | $6.68B | – | 6% |
| Net income, nine months ended September 30, 2026non-GAAP | $21.84B | – | – |
| Effective tax rate, three months ended September 30, 2026non-GAAP | 24.0% | – | – |
| Effective tax rate, nine months ended September 30, 2026non-GAAP | 20.9% | – | – |
| Earnings per share (diluted), three months ended September 30, 2026non-GAAP | $7.48 | – | 7% |
| Earnings per share (diluted), nine months ended September 30, 2026non-GAAP | $24.41 | – | – |
| Acquired IPR&D charges included in reported and non-GAAP EPS, Q3 2026other | $4.57 | – | – |
| Key Products revenue, Q3 2026other | $17.1B | – | – |
| U.S. revenue, Q3 2026other | $15.1B | – | 34% |
| Revenue outside the U.S., Q3 2026other | $9.3B | – | 47% |
| Jardiance sales-based milestones outside the U.S., Q3 2026other | $410M | – | – |
| Zepbound revenue, nine months ended September 30, 2026other | $14.44B | – | 56% |
| Mounjaro revenue, nine months ended September 30, 2026other | $29.33B | – | 89% |
| Jaypirca revenue, nine months ended September 30, 2026other | $585M | – | 63% |
| Ebglyss revenue, nine months ended September 30, 2026other | $548M | – | 100% |
| Kisunla revenue, nine months ended September 30, 2026other | $484M | – | NM |
| Omvoh revenue, nine months ended September 30, 2026other | $296M | – | 67% |
| Foundayo revenue, nine months ended September 30, 2026other | $281M | – | NM |
| Inluriyo revenue, nine months ended September 30, 2026other | $183M | – | NM |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Mounjaro, Q3 2026Worldwide revenue increased 65%, with U.S. revenue reflecting strong demand and revenue outside the U.S. primarily driven by volume growth, partially offset by lower realized prices driven by the addition of Mounjaro on the NRDL in Q1 2026. | $10.72B | – | 65% |
| Zepbound, Q3 2026U.S. Zepbound revenue increased 48%, primarily driven by strong demand, partially offset by lower realized prices. | $5.35B | – | 49% |
| Jaypirca, Q3 2026 | $228M | – | 59% |
| Ebglyss, Q3 2026 | $202M | – | 59% |
| Kisunla, Q3 2026 | $193M | – | 175% |
| Omvoh, Q3 2026 | $114M | – | 76% |
| Foundayo, Q3 2026Global launches of Foundayo were cited as a revenue-growth driver. | $184M | – | NM |
| Inluriyo, Q3 2026 | $73M | – | NM |
Full-year 2026 outlook
- Revenue$91 to $92 billion
- Tax rate19% to 20%
- NotePerformance Margin (non-GAAP): 52.0% to 52.5%
- NoteEarnings per Share (non-GAAP): $35.00 to $36.00
- NoteGuidance does not include acquired in-process research and development (IPR&D) incurred after September 30, 2026.
- NoteAssumes shares outstanding of approximately 894 million and foreign currency exchange rate assumptions of 1.13 (Euro), 157 (Yen) and 6.7 (Yuan)
Capital returns
- Dividends paid per share, three months ended September 30, 2026: $1.73; 2025: $1.50; 15%.
- Dividends paid per share, nine months ended September 30, 2026: $5.19; 2025: $4.50; 15%.
What drove it
- Worldwide revenue increased 39%, driven by a 53% increase in volume, partially offset by a 15% decrease in realized prices.
- Revenue growth was driven primarily by Mounjaro and Zepbound.
- U.S. revenue increased 34%, driven by a 41% increase in volume, partially offset by a 7% decrease in realized prices.
- Revenue outside the U.S. increased 47%, driven by a 76% increase in volume, partially offset by a 29% decrease in realized prices.
- Reported gross margin benefited from favorable product mix and improved cost of production, partially offset by lower realized prices.
- Q3 2026 revenue included approximately $900 million of benefits, primarily from $410 million of Jardiance milestones and favorable adjustments to rebate and discount estimates.
Concerns
- Realized prices decreased 15% worldwide, 7% in the U.S., and 29% outside the U.S.
- Acquired IPR&D increased to $4,181 million from $656 million, primarily related to the acquisitions of AtaiBeckley Inc. and Curevo Inc.
- The reported effective tax rate increased to 23.3% from 22.8%, primarily due to the unfavorable tax impact of nondeductible acquired IPR&D charges.
- Jardiance milestones of $410 million were included in Q3 2026 revenue, and no further milestones remain.
- Mounjaro pricing outside the U.S. was affected by its addition to the National Reimbursement Drug List in China.
What to watch
- Full-year 2026 revenue delivery against the updated $91 to $92 billion guidance range.
- Performance-margin delivery against the updated 52.0% to 52.5% non-GAAP range.
- Mounjaro and Zepbound demand, volume growth, realized-price trends, and obesity-care coverage.
- The impact of acquired IPR&D incurred after September 30, 2026, which is excluded from guidance.
- Phase 3 trials of EloraTZP, which are expected to start in Q4 2026.
- Execution of the AtaiBeckley acquisition and the subsequent acquisition of Merida Biosciences.
Analysis
Lilly delivered strong third-quarter growth, with revenue increasing 39% to $24.4 billion. Worldwide volume increased 53%, while realized prices declined 15%. Mounjaro generated $10,723 million of revenue, up 65%, and Zepbound generated $5,352 million, up 49%, making those products the central contributors to the quarter. Revenue also included approximately $900 million of benefits, primarily including $410 million of Jardiance milestones and favorable rebate and discount-estimate adjustments.
The geographic mix shows continued international expansion alongside strong U.S. demand. U.S. revenue increased 34% to $15.1 billion on 41% volume growth, while revenue outside the U.S. increased 47% to $9.3 billion on 76% volume growth. Price pressure was evident in both markets, particularly outside the U.S., where realized prices declined 29%, primarily due to Mounjaro being added to China's National Reimbursement Drug List.
Margins expanded despite lower realized prices. Reported gross margin rose 40% to $20,464 million and reached 83.9% of revenue, up 1.0 percentage points, driven by favorable product mix and improved cost of production. Non-GAAP gross margin was 84.4%. Operating income increased 17% to $8,608 million, but acquired IPR&D charges increased to $4,181 million from $656 million, primarily related to the AtaiBeckley and Curevo acquisitions. Reported EPS increased 16% to $7.22 and non-GAAP EPS increased 7% to $7.48; both included $4.57 of acquired IPR&D charges.
The company materially raised its outlook, increasing full-year revenue guidance from $85 to $87 billion to $91 to $92 billion and performance-margin guidance from 49.0% to 50.5% to 52.0% to 52.5%. Full-year non-GAAP EPS guidance moved to $35.00 to $36.00 from $35.50 to $36.50 because a $4.07 midpoint increase in underlying non-GAAP EPS guidance was more than offset by $4.57 of Q3 acquired IPR&D charges. The guidance excludes acquired IPR&D incurred after September 30, 2026, leaving subsequent business-development costs as an important variable.
Portfolio progress extended beyond current commercial products. Lilly cited FDA approvals and expanded indications across diabetes, oncology, and hematology, positive clinical results for retatrutide, Ebglyss, and EloraTZP, and planned Q4 2026 Phase 3 starts for EloraTZP. The company also completed the AtaiBeckley acquisition during the quarter and completed the Merida Biosciences acquisition subsequent to quarter end, adding further pipeline and integration activity alongside its manufacturing expansions in Texas and Virginia.
Management, verbatim
Lilly had another strong quarter, exceeding our prior expectations and allowing us to raise our full-year outlook.
David A. Ricks, Lilly chair and CEO
Not in the filing
stated, not guessed- Cash balance was not reported.
- Debt balance was not reported.
- Operating cash flow was not reported.
- Free cash flow was not reported.
- Share repurchases were not reported.
- Prior-quarter comparisons were not reported for the financial metrics.
- Segment operating income or segment profitability was not reported.
- A previous release outlook was not provided; therefore, no actual-versus-prior-guidance comparison is included.
- A forward-looking GAAP reconciliation for non-GAAP guidance was not provided because Lilly stated that comparable GAAP measures are not reasonably accessible or reliable.
Written by an AI language model 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 checked against the filing text, and a metric whose value, prior period and change do not add up is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.