Pfizer Inc. (NYSE: PFE) reported financial results for first-quarter 2016 and updated certain components of its 2016 financial guidance. Reported revenues totaled $13.0 billion, an increase of $2.1 billion, or 20%, which reflects operational growth of $2.9 billion, or 26%, partially offset by the unfavorable impact of foreign exchange of $729 million, or 7%. Excluding the impact of legacy Hospira operations of $1.2 billion and foreign exchange, Pfizer-standalone revenues increased by $1.7 billion operationally, or 15%. Compared with the prior-year quarter, first-quarter 2016 revenues were favorably impacted by approximately $900 million as a result of first-quarter 2016 having five additional selling days in the U.S. and four additional selling days in international markets. This imbalance in selling days will be offset in fourth-quarter 2016 resulting in essentially the same number of selling days in full-year 2016 as 2015.
Operational revenue growth in developed markets was driven primarily by the inclusion of $1.1 billion of revenues from legacy Hospira operations and continued strong performance of several key products, notably Ibrance, Prevnar 13, Eliquis, Xeljanz and Lyrica - all primarily in the U.S. In emerging markets, revenues increased 14% operationally, favorably impacted by the addition of legacy Hospira operations, which contributed $78 million, as well as the performance of Enbrel, Prevenar 13 and continued strong volume growth from certain other products.
Operational revenue growth was partially offset primarily by the loss of exclusivity and associated generic competition for Zyvox, primarily in the U.S. and certain developed Europe markets, and Lyrica in certain developed Europe markets.
The ranges for certain components of Pfizer's 2016 financial guidance have been updated, primarily reflecting the following:
- Operational Factors: Strong performance to date coupled with an improved business outlook for 2016, which favorably impacted the midpoint of the guidance range for reported revenue by approximately $1.0 billion and for reported and adjusted diluted EPS by $0.12.
- Foreign Exchange: Favorable changes in foreign exchange rates since mid-January 2016, which favorably impacted the midpoint of the guidance range for reported revenue by approximately $1.0 billion and for reported and adjusted diluted EPS by $0.06.
Ian Read, Chairman and Chief Executive Officer, stated, "We began the year with very strong operational performance across both our Innovative and Established businesses and this has served as a key driver of an increase in both our revenue and earnings per share guidance for the remainder of the year. I believe this performance results from our Company being well positioned in terms of product portfolio, organizational structure and leadership, as well as by our continued strong financial flexibility. In addition, our late stage product pipeline is increasingly ready to deliver our next set of prospective growth drivers with competitive positions in high-potential therapeutic areas where I believe Pfizer can be a leader.
"In addition, we have made excellent progress integrating the legacy Hospira operations and now expect to achieve $1.0 billion of Hospira cost savings by 2018, 25% more than our initial cost savings target of $800 million. Overall, we remain focused on delivering continued revenue growth both through internal and external opportunities, managing an efficient operating structure and making shareholder-friendly capital allocation and business portfolio decisions," Mr. Read concluded.
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At Pfizer, we apply science and our global resources to bring therapies to people that extend and significantly improve their lives. We strive to set the standard for quality, safety and value in the discovery, development and manufacture of health care products. Our global portfolio includes medicines and vaccines as well as many of the world's best-known consumer health care products. Every day, Pfizer colleagues work across developed and emerging markets to advance wellness, prevention, treatments and cures that challenge the most feared diseases of our time. Consistent with our responsibility as one of the world's premier innovative biopharmaceutical companies, we collaborate with health care providers, governments and local communities to support and expand access to reliable, affordable health care around the world. For more than 150 years, Pfizer has worked to make a difference for all who rely on us.