second quarter of 2026
Filed Aug 5, 2026Portfolio Receipts increased by 6% to $773 million; Royalty Pharma raised full year 2026 Portfolio Receipts guidance to $3,400 million to $3,500 million.
Royalty Receipts grew 14% to $768 million, Adjusted EBITDA increased 16% to $736 million, and the company raised Portfolio Receipts guidance. Portfolio Receipts growth was lower at 6% because Milestones and other contractual receipts fell 91% versus a prior-year one-time distribution.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Portfolio Receiptsother | $773 million | – | 6% |
| Royalty Receiptsother | $768 million | – | 14% |
| Milestones and other contractual receiptsother | $5 million | – | (91)% |
| Net cash provided by operating activitiesGAAP | $728 million | – | 100% |
| Adjusted EBITDAnon-GAAP | $736 million | – | 16% |
| Portfolio Cash Flownon-GAAP | $736 million | – | 15% |
| Payments for operating and professional costsother | ($37) million | – | – |
| Payments for operating and professional costs as a percentage of Portfolio Receiptsother | 4.8% | – | – |
| Interest (paid)/received, netother | ($0) million | – | – |
| Weighted average Class A ordinary shares outstanding - dilutedother | 557 million | – | (1)% |
| Capital Deploymentother | $349 million | – | – |
| Purchases of available for sale debt securities, six months ended June 30other | — | – | – |
| Acquisitions of financial royalty assets, six months ended June 30other | ($703) million | – | – |
| Development-stage funding payments, six months ended June 30other | ($123) million | – | – |
| Milestone payments, six months ended June 30other | ($50) million | – | – |
| Contributions from legacy non-controlling interests - R&D, six months ended June 30other | — | – | – |
| Capital Deployment, six months ended June 30other | ($877) million | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Cystic fibrosis franchiseNo product-specific driver provided. | $194 million | – | 0% |
| TysabriNo product-specific driver provided. | $67 million | – | 19% |
| TrelegyNo product-specific driver provided. | $58 million | – | 3% |
| TremfyaIdentified as a primary driver of the increase in Royalty Receipts. | $57 million | – | 53% |
| EvrysdiRoyalty Receipts included the benefit of the additional royalties acquired in December 2025. | $47 million | – | 42% |
| VoranigoIdentified as a primary driver of the increase in Royalty Receipts. | $46 million | – | 72% |
| XtandiNo product-specific driver provided. | $44 million | – | 6% |
| ImbruvicaDeclines from Imbruvica partially offset Royalty Receipts growth. | $36 million | – | (16)% |
| Cabometyx/CometriqNo product-specific driver provided. | $23 million | – | 12% |
| ImdelltraIdentified as a primary driver of the increase in Royalty Receipts. | $17 million | – | n/a |
| TrodelvyNo product-specific driver provided. | $14 million | – | 36% |
| SpinrazaNo product-specific driver provided. | $11 million | – | (11)% |
| AmvuttraNo product-specific driver provided. | $9 million | – | n/a |
| PromactaDeclined due to U.S. generic competition. | $8 million | – | (75)% |
| Other products (5)No product-specific driver provided. | $139 million | – | 28% |
full year 2026 outlook
- RevenuePortfolio Receipts: $3,400 million to $3,500 million
- Operating expensesPayments for operating and professional costs: 5.5% to 6.5% of Portfolio Receipts
- NoteExpected Royalty Receipts growth: 7% to 10% in 2026.
- NoteInterest paid: $350 million to $360 million.
- NoteEstimated foreign exchange impact: approximately +1% to Portfolio Receipts.
- NoteInterest paid in the third quarter of 2026: approximately $175 million.
- NoteInterest paid in the fourth quarter of 2026: a de minimis amount.
- NoteGuidance assumes repayment of the $380 million term loan in July 2026 and no additional debt financing in 2026.
- NoteGuidance excludes new transactions and borrowings announced after the date of the release and contributions from transactions announced subsequent to the date of the press release.
Capital returns
- Quarterly dividend: $0.235 per share, equating to $135 million in dividends and distributions in the second quarter of 2026.
- Repurchased approximately 0.9 million Class A ordinary shares for $45 million in the second quarter of 2026.
- Repurchased two million Class A ordinary shares for $96 million for the first six months of 2026.
What drove it
- Royalty Receipts growth was primarily driven by Tremfya, Voranigo, Imdelltra and Evrysdi.
- Portfolio Receipts growth reflected the Royalty Receipts increases, partially offset by lower Milestones and other contractual receipts.
- Milestones and other contractual receipts declined due to a one-time distribution received in the prior-year period.
- Payments for operating and professional costs are expected to decrease as a percentage of Portfolio Receipts compared with 8.9% in 2025, primarily due to extinguishment of the management fee following the internalization transaction on May 16, 2025.
- Second-quarter Capital Deployment consisted primarily of royalty funding for daraxonrasib and R&D funding for JNJ-4804 and litifilimab.
Concerns
- Milestones and other contractual receipts declined 91% to $5 million, reflecting a one-time distribution received in the prior-year period.
- Promacta Portfolio Receipts declined 75% due to U.S. generic competition.
- Imbruvica Portfolio Receipts declined 16%.
- Guidance assumes no major unforeseen adverse events or changes in foreign exchange rates.
What to watch
- Delivery against full year 2026 Portfolio Receipts guidance of $3,400 million to $3,500 million and expected Royalty Receipts growth of 7% to 10%.
- The expected approximately $175 million of interest paid in the third quarter of 2026.
- Progress of daraxonrasib after the FDA accepted its NDA for review and the EMA started its accelerated review.
- The royalty on AstraZeneca's cliramitug, acquired in July 2026 for up to $425 million, including $125 million upfront.
- Deployment under the up to $1.7 billion of announced new transactions as of August 4, 2026.
Balance sheet and cash flow
- Cash and cash equivalents as of June 30, 2026: $812 million.
- Total debt with principal value as of June 30, 2026: $9.2 billion.
- Repaid the $380 million term loan upon maturity in July 2026.
- Net cash provided by operating activities was $728 million in the second quarter of 2026.
- Royalty Pharma collected interest of $5 million on its cash and cash equivalents in the second quarter of 2026.
- Capital Deployment was $349 million in the second quarter of 2026.
- As of August 4, 2026, announced new transactions of up to $1.7 billion and Capital Deployment of $1.1 billion.
Analysis
Royalty Pharma reported second-quarter Portfolio Receipts of $773 million, up 6% from $727 million, while Royalty Receipts grew 14% to $768 million. The difference reflects Milestones and other contractual receipts of $5 million, down 91% from $56 million because the prior-year period included a one-time distribution. The company raised full year 2026 Portfolio Receipts guidance to $3,400 million to $3,500 million from $3,325 million to $3,450 million.
Royalty Receipts growth was led by Tremfya, Voranigo, Imdelltra and Evrysdi. Tremfya increased 53% to $57 million, Voranigo increased 72% to $46 million, and Evrysdi increased 42% to $47 million, with Evrysdi benefiting from additional royalties acquired in December 2025. Offsetting portfolio pressure came from Promacta, down 75% to $8 million due to U.S. generic competition, and Imbruvica, down 16% to $36 million.
Cash generation improved materially. Net cash provided by operating activities was $728 million, compared with $364 million, while Adjusted EBITDA increased 16% to $736 million and Portfolio Cash Flow increased 15% to $736 million. Payments for operating and professional costs were $37 million and represented 4.8% of Portfolio Receipts. The company expects those costs to be 5.5% to 6.5% of full-year Portfolio Receipts, compared with 8.9% in 2025, primarily due to the extinguishment of the management fee following the May 16, 2025 internalization transaction.
Capital allocation remained active. Capital Deployment was $349 million in the quarter and $877 million for the first six months of 2026. As of August 4, 2026, the company had announced new transactions of up to $1.7 billion and Capital Deployment of $1.1 billion. In July, Royalty Pharma acquired a portion of Neurimmune AG's royalty interest in AstraZeneca's cliramitug for up to $425 million, including $125 million upfront.
Liquidity at June 30 included $812 million of cash and cash equivalents and $9.2 billion of total debt with principal value. The company repaid its $380 million term loan in July 2026. It returned capital through a $0.235 per-share quarterly dividend, equating to $135 million, and $45 million of second-quarter share repurchases. Guidance assumes interest paid of $350 million to $360 million for 2026, including approximately $175 million in the third quarter, no additional debt financing in 2026, and an estimated foreign exchange impact of approximately +1% to Portfolio Receipts.
Management, verbatim
Royalty Pharma delivered strong second quarter results with Royalty Receipts growth of 14%.
Pablo Legorreta, Chief Executive Officer and Chairman of the Board
Not in the filing
stated, not guessed- GAAP revenue, gross profit or gross margin were not provided in the supplied filing text.
- GAAP operating income, GAAP net income, GAAP diluted EPS, and non-GAAP EPS were not provided in the supplied filing text.
- Prior-quarter comparisons for Portfolio Receipts, Royalty Receipts, product-level Portfolio Receipts, cash flow measures, and diluted shares were not provided.
- A previous earnings release outlook section was not provided, so no reported actual-versus-prior-guidance comparison is included.
- Balance-sheet comparative cash and debt figures were not provided.
- Free cash flow was not reported.
- Product-level drivers were not separately provided for the cystic fibrosis franchise, Tysabri, Trelegy, Xtandi, Cabometyx/Cometriq, Trodelvy, Spinraza, Amvuttra, and Other products (5).
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.