Gilead lifts 2026 sales outlook on HIV strength

Gilead Sciences raised its 2026 sales outlook after reporting robust third-quarter 2026 results driven by its HIV portfolio and oncology medicines. The company now expects full-year product sales of approximately $31.0 billion to $31.3 billion, including base-business sales of $30.7 billion to $31.0 billion excluding Veklury. This reflects a higher base-business growth outlook of 10% to 11% for 2026, supported by projected HIV revenue growth of about 12%. The company increased its base-business sales guidance by $900 million following the quarter, and said the outlook is $1.65 billion higher than at the beginning of the year.

Total product sales in the quarter ended September 30, 2026, rose 13% year over year to $8.3 billion and 9% sequentially. Sales excluding Veklury, Gilead’s COVID-19 therapy, climbed 16% to $8.2 billion, marking the company’s strongest base-business growth in more than a decade. Veklury revenue fell to $86 million, a 69% decline from a year earlier, reflecting fewer COVID-19-related hospitalizations and widening the gap between overall and base-business performance.

HIV medicines remained the main growth engine in the third quarter. HIV product sales increased 18% year over year and 10% sequentially to $6.25 billion, the strongest annual growth for the portfolio in more than seven years. Gilead attributed the performance to higher average realized prices, stronger demand and favorable inventory movements. Biktarvy, a core HIV therapy, generated $4.1 billion in sales, up 10% year over year and 8% sequentially, and reached an estimated U.S. market share of about 53%.

The HIV prevention franchise also expanded rapidly. The prevention business, including Descovy for PrEP and Yeztugo, produced $1.0 billion in quarterly sales, an increase of 49% year over year and 8% sequentially. Yeztugo contributed $305 million and grew 31% sequentially, with full-year 2026 sales expected to be near $1 billion. Gilead further broadened its HIV treatment offerings with the August U.S. launch of Bixlenvo, a once-daily single-tablet regimen for virologically suppressed adults switching therapies, and reported rapid initial uptake among patients on complex regimens.

Beyond HIV, oncology and liver disease products added to base-business momentum. Growth from Trodelvy and Livdelzi helped offset continued weakness in cell therapy. Gilead reported that Livdelzi now accounts for more than half of the U.S. second-line primary biliary cholangitis market. Favorable pricing in hepatitis C and hepatitis B also supported the liver portfolio, partly offset by fewer hepatitis C treatment starts.

Management highlighted diversification across HIV, oncology and inflammation as a strategic priority. The company pointed to ongoing commercial launches and clinical development aimed at sustaining growth across these therapeutic areas while managing reimbursement pressures.

Gilead’s profitability remained solid in the third quarter. Non-GAAP operating income rose 6% to $4.17 billion, with an operating margin of about 50%. Product gross margin improved by 165 basis points to 88%. Non-GAAP diluted earnings per share increased to $2.55 from $2.47 a year earlier, and excluding a prior-year benefit from intellectual-property asset sales, non-GAAP diluted EPS grew 15%.

At the same time, spending continued to rise. Research and development expense increased 19% to $1.59 billion, driven by higher compensation accruals and clinical costs, while selling, general and administrative expense rose 14% to $1.54 billion, mainly reflecting HIV promotional activity, legal costs and higher compensation accruals. For the full year, Gilead expects mid- to high-single-digit R&D growth and high-single-digit SG&A growth, and projects acquired in-process R&D of about $12.9 billion, including roughly $1.4 billion of upfront payments in the fourth quarter tied to planned transactions.

The company also flagged regulatory and clinical uncertainties. It cited clinical holds affecting GS-3107 and KITE-753, and noted that the EVOKE-03 study of Trodelvy did not meet its primary endpoint and was discontinued. Management additionally highlighted an expected Biktarvy pricing headwind of $1.5 billion in 2028, underscoring longer-term pricing and reimbursement risk.

The raised outlook and quarterly beat prompted positive reactions from equity analysts. UBS increased its stock price target for Gilead, citing a revenue beat of about $500 million and a roughly $900 million increase in fiscal 2026 guidance, driven by continued HIV portfolio strength. TD Cowen lifted its price target to $175 with a Buy rating, while BMO Capital raised its target to $184 with an Outperform rating, pointing to the commercial performance of Yeztugo and growth in pre-exposure prophylaxis products.

Gilead’s shares trade at a Price-to-Sales ratio of about 6.75, compared with a historical median of 3.75 over the past decade.