GILD · Q1 2026 Earnings

Cautious

Gilead Sciences

Reported May 7, 2026

30-second summary

30-second take: Gilead delivered Q1 FY2026 revenue of $6.96B (+4% YoY) and non-GAAP EPS of $2.03, raised FY2026 product sales guidance by $400M at both ends to $30.0B–$30.4B on HIV strength, and reduced FY2026 non-GAAP EPS guidance by ~$9.50/share to a loss of $(1.05)–$(0.65), entirely attributable to IPR&D charges and financing costs from Arcellx, Ouro and Tubilis; underlying EPS guide effectively maintained per management. Yeztugo answered the watch list cleanly with $166M (+72% QoQ) and guidance raised to $1B for the year, but the headline EPS optic — even with the IPR&D bridge in the press release — forces investors to re-underwrite the FY profitability framing through the acquisition lens.

Headline numbers

EPS

Q1 FY2026

$2.03

Revenue

Q1 FY2026

$6.96B

+4.0% YoY

Gross margin

Q1 FY2026

79.2%

Free cash flow

Q1 FY2026

$2.43B

Operating margin

Q1 FY2026

37.2%

Key financials

Q1 FY2026

Metric	Q1 FY2026	YoY	Q4 FY2025	QoQ
Revenue	$6.96B	+4.0%	$7.92B	-12.2%
EPS	$2.03	—	$1.86	+9.1%
Gross margin	79.2%	—	79.5%	-30bps
Operating margin	37.2%	—	25.0%	+1220bps
Free cash flow	$2.43B	—	$3.12B	-22.2%

Guidance

FY2026 revenue guidance raised modestly on strong Q1 performance, but GAAP and Non-GAAP EPS guidance slashed dramatically to losses, indicating major cost headwinds or R&D investments ahead.

Guidance is issued for the full year only, refreshed each quarter. Prior and new below are the same FY updated this quarter.

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
Product Sales (total)	FY 2026	$29,600 to $30,000 million	$30,000 to $30,400 million	+$400M at high end (+1.3%), +$400M at low end (+1.3%)	Raised
Product Sales Excluding Veklury	FY 2026	$29,000 to $29,400 million	$29,400 to $29,800 million	+$400M at both low and high ends (+1.4%)	Raised
Diluted EPS (GAAP)	FY 2026	$6.75 to $7.15	$(2.85) to $(3.25)	Loss of $9.60 to $10.40 per share; massive swing from profitable to loss guidance	Lowered
Non-GAAP Diluted EPS	FY 2026	$8.45 to $8.85	$(0.65) to $(1.05)	Loss of $9.10 to $9.90 per share; swing from +$8.65 midpoint to -$0.85 midpoint	Lowered

Reaffirmed unchanged this quarter: Veklury ($600 million)

Segment KPIs

Q1 FY2026

Segment	Q1 FY2026	YoY
HIV	$5.03B	+10.0%
Liver Disease	$0.767B	+1.0%
Oncology	$0.81B	+7.0%
Cell Therapy	$0.407B	-12.0%
Veklury	$0.144B	-52.0%
Biktarvy	$3.361B	+7.0%
Trodelvy	$0.402B	+37.0%
Descovy	$0.807B	+38.0%
Product Sales Excluding Veklury	$6.8 billion	—
HIV Product Sales Growth	10% YoY	—

Other KPIs

Q1 FY2026

Segment	Q1 FY2026
Non-GAAP Product Gross Margin	87.5%
Non-GAAP Operating Margin	46.9%
Operating Cash Flow	$2.544 billion
Free Cash Flow	$2.427 billion
Dividend Per Share	$0.82
Cash, Equivalents and Marketable Securities	$8.625 billion

Management tone

The center of gravity has shifted from defending HIV revenue to deploying capital into ADC, T-cell engager and cell-therapy assets — three acquisitions (Arcellx, Ouro, Tubilis) reshape the pipeline this quarter. Management's language — "well-positioned for sustained growth" and "up to four potential launches and five Phase 3 updates anticipated in 2026" — frames the FY2026 GAAP loss guide as backward-looking accounting for deals already signed, not a deterioration in underlying earnings.

The Yeztugo language has matured into operational granularity — "$1B Yeztugo guidance for 2026 vs. $800M start-of-year, 95% coverage with 95% having $0 copay, switch share roughly one-third split among other LAIs, Truvada generics, and Descovy, market growing ~14%." This is the language of an asset transitioning from launch to franchise, and the $200M FY guidance lift in one quarter is the clearest validation of the launch curve.

The Tubilis acquisition is being defended on platform grounds, not just on TUB-40 ovarian cancer data — the P5 linker technology and the ALCO5 conjugation platform, plus TUB-30 (5T4-targeted, Phase I basket including head/neck and NSCLC), are positioned as a multi-asset bet alongside the lead ovarian program. Management's framing: ovarian cancer alone justifies the transaction price (price not disclosed in current materials), with lung and platform optionality as upside.

Q&A highlights

Akash Tiwari · Jefferies

Regarding Tubulus acquisition: what portion of the $3.5B ovarian cancer market opportunity is driven by TUB40 versus potential in lung cancer given NAPI 2B expression? Also, what additional validation is needed from PD-1 VEGF class data at ASCO before pursuing combination approaches with ADC platform?

Tubulus provides unprecedented ovarian cancer data with strong ORR and durability without biomarker selection, plus TUB30 platform potential in other solid tumors. The P5 linker technology and ALCO5 platform enable novel payload delivery with differentiated tolerability (no lung, ocular toxicity). Combination strategies require tumor-type-specific evaluation of PD-1/VEGF mechanisms.

TUB40 data presented at ESMO showed strong objective response rate and durabilityNo lung toxicity, ocular toxicity, stomatitis, or neuropathy observed with TUB40Ovarian cancer opportunity alone justifies transaction priceTUB30 in Phase I basket trial in multiple solid tumors including head/neck and NSCLC

Terrence Flynn · Morgan Stanley

On Yes2Go launch: provide latest mix of switch versus naive patients, buy-and-bill dynamics, and validation of adherence assumptions embedded in $1B guidance.

Switch share is higher than naive but naive showing strong momentum. Market share approximately one-third split among other LAI injectable, Truvada generics, and Descovy. Persistency trending higher than current competition; second dose return rates encouraging. 95% coverage with 95% having $0 copay. DTC campaign started late February showing strong brand awareness.

$1B Yes2Go guidance for 2026 vs. $800M start-of-year95% coverage with 95% having $0 copayQ1 sales $166M, up 72% sequentiallySwitch share showing one-third split among LAI options

Salveen Richter · Goldman Sachs

For Yes2Go users: what proportion of those not returning for second dose are stopping PrEP versus switching to another option versus experiencing delays? Also, impact of DTC efforts on persistence.

Claims data tracking shows positive comeback patterns on second dose within expected timeframe. DTC efforts (started late February) driving increased brand awareness and reminding patients to return for injections. Market research with HCPs shows positive feedback. Specialty pharmacy outreach supporting persistence. DTC results still early (6-12 months typical lag for full output).

Good second dose comeback within expected timeframeDTC launched late February showing huge brand awareness increaseSocial media awareness ramping up6-12 month typical lag for DTC output measurement

Mohit Bansal · Wells Fargo

On BICLEN (bictegravir plus lenacapavir) treatment opportunity: 5-6% of HIV market on complex multi-pill regimens represents sizable opportunity. How does management view BICLEN's market size potential even in the switch market? How will it compete against BIKTARVI?

Two opportunities identified: (1) 5-6% of PLWH on complex multi-pill regimens (5-8 pills daily) for simplification, (2) ~20% switch market where physicians/patients pursue innovation. BICLEN targets complex-regimen simplification and switch market currently captured by competitors. Biktarvi expected to remain standard of care through 2036 LOE. Combination of bictegravir + lenacapavir orthogonal mechanisms with no cross-resistance. Modest 2026 revenue with ramp in 2027+ following late August 2026 launch.

5-6% of PLWH on complex multi-pill regimens (target simplification)~20% of market switches annuallyBIKTARVI LOE not until 2036Two orthogonal mechanisms with no cross-resistance

Alex Hammond · Wolf Research

With three new acquisition integrations running simultaneously alongside multiple commercial launches, how should investors think about margin dynamics near-term and long-term, particularly 2027-2028? Is there room for margin expansion?

Q1 operating margin at 47%, strengthening YoY. Revenue outperformance ($400M increase) and disciplined expense management offsetting incremental acquisition expenses (~$400M, with ~$200M in R&D). On apples-to-apples basis (excluding IPR&D and financing costs), maintaining start-of-year EPS guidance. 2027 expected to accommodate incremental expenses within portfolio; 2028+ expects margin strengthening as phase 3 trials wrap up. Acquisitions are high-quality assets; no expectation of material margin pressure.

Q1 operating margin 47%~$400M incremental operating expenses~$200M of incremental expenses are R&DOffsetting with revenue outperformance and expense discipline

Answers to last quarter's watch list

Yeztugo Q1 2026 print vs. the implied $800M FY2026 trajectory. Yeztugo printed $166M in Q1, +72% QoQ from $96M in Q4 and well above the ~$120M risk threshold. Management raised FY2026 Yeztugo guidance to $1B (from $800M), a 25% lift in one quarter. Status: Resolved positively

Veklury Q1 2026 vs the new $600M FY guide. Veklury printed $144M, -52% YoY and below the implied quarterly run rate of ~$150M to hit $600M. The $600M FY guide was reaffirmed unchanged. Status: Continue monitoring

anito-cel launch readiness milestones. PDUFA target action date of December 23, 2026 confirmed; per Mercier's prepared remarks, "factoring in the time needed for site activation, we expect revenue from [anito-cel] to begin in early 2027." Status: Resolved (with revenue beginning early 2027, not H2 2026)

HIV ex-Part D / ex-policy framing for FY2026. Management framed Q1 as "8% YoY growth in our base business and 10% growth in HIV," and Dickinson disclosed a ~2% growth headwind from policy (the December 2025 Medicaid pricing agreement and the ACA), implying ex-policy base business growth of 7%–8%. Status: Resolved

GS3242 Phase I data disclosure. Phase I data shared at CROI in February showed potential for injectable dosing every four months; higher-dose cohorts targeting twice-yearly dosing are ongoing. A Phase II trial combining GS3242 with lenacapavir is targeted to initiate 2H 2026. Status: Resolved

Cell Therapy stabilization confirmation. Cell Therapy printed -12% YoY, with Yescarta -14% and Tecartus -4%, reflecting continued in- and out-of-class competition. The franchise is stepping back down, not stabilizing. Status: Resolved negatively

What to watch into next quarter

The IPR&D/financing-cost bridge disclosure in the 10-Q. The press release attributes the full ~$9.50/share EPS swing to Arcellx/Ouro/Tubilis IPR&D ($11.5B) and financing costs. Watch for the explicit non-GAAP add-back schedule and any drift in underlying ex-deal EPS framing.

Yeztugo Q2 print vs. the implied $1B FY trajectory. Q1 $166M against a $1B FY implies ~$278M/quarter average for the remaining three quarters. A Q2 print below $200M would suggest the guide is back-loaded; above $230M would set up another raise.

Veklury Q2 vs $600M FY reaffirmation. Q1 at $144M is below the ~$150M quarterly run rate. If Q2 prints below $140M, the $600M floor will be tested mid-year.

anito-cel early-2027 revenue ramp readiness. December 23, 2026 PDUFA, then site activation through 1H 2027. Watch for site-activation count, manufacturing turnaround disclosure, and IMAGINE-3 enrollment-completion confirmation in Q2.

BICLEN August 2026 PDUFA and launch trajectory. PDUFA target August 27, 2026; watch whether management quantifies the complex-regimen and switch-market addressable share at Q2.

TUB-40 ASCO update and TUB-30 basket trial readout cadence. More mature TUB-40 Phase I ovarian data at ASCO in June; any TUB-30 head/neck or NSCLC disclosure would crystallize the multi-asset platform thesis.

Sources

Gilead Sciences Q1 FY2026 press release and financial tables (SEC EDGAR exhibit 99.1), 2026-05-07: https://www.sec.gov/Archives/edgar/data/882095/000088209526000022/exhibit991earningspressrel.htm
Gilead Sciences Q1 FY2026 earnings call prepared remarks and Q&A (transcript, partial — Q&A truncated mid-Flynn response)
Gilead Sciences Q4 FY2025 Tapebrief, 2026-02-10 (prior-quarter watch list and FY2026 initial guidance baseline)

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