TLDR
- Q2 net sales hit $14.41 billion, up 3% in USD, with volume growth driving momentum
- Core operating profit rose to $5.94 billion, beating analyst expectations of $5.31 billion
- Kisqali sales jumped 44% to $1.7 billion; Scemblix nearly doubled to $562 million
- Entresto sales dropped 50% to $1.18 billion due to generic competition in the US
- Novartis reaffirmed 2026 guidance and stock rose about 2% in early trading
Novartis posted Q2 net sales of $14.41 billion on Tuesday, up 3% in US dollars, as its newer drug portfolio outweighed a sharp decline in heart drug Entresto.
NOVARTIS $NVS Q2’26 EARNINGS HIGHLIGHTS
🔹 Revenue: $14.41B (Est. $14.2B) 🟢; +3% YoY
🔹 Core EPS: $2.41 (Est. $2.2) 🟢; flat YoY
🔹 Core Oper. Margin: 41.2%; -100 bps YoY
🔹 FCF: $5.56B; -12% YoYReaffirms FY26 Guide:
🔹 Sales Growth: Low single-digit (Est. +0.41%) 🟢
🔹 Core… pic.twitter.com/po3GsgFGWQ— Wall St Engine (@wallstengine) July 21, 2026
The stock rose about 2% in early trading following the results, with the company’s market cap sitting around $310 billion after a 14% gain so far this year.
Core operating profit, the key non-IFRS figure watched by analysts, came in at $5.94 billion. That was well above the average analyst estimate of $5.31 billion cited by Visible Alpha.
Barclays analysts noted the profit beat was driven mostly by cost control. Core selling, general and administrative expenses fell 6% to $3.24 billion in the quarter.
Net income fell 19% to $3.26 billion, hit by higher income taxes and interest expense. Earnings per share dropped 17% to $1.71.
Kisqali, the breast cancer drug, grew 44% to $1.7 billion. Scemblix nearly doubled, rising 89% to $562 million. Kesimpta gained 32% to $1.42 billion, Pluvicto climbed 43% to $651 million, and Leqvio advanced 59% to $480 million.
The good news on newer drugs was offset by Entresto, which fell 50% to $1.18 billion as generic competition intensified in the US. Analysts had expected $1.23 billion. Tasigna also dropped 58% to $142 million.
Guidance Reaffirmed
Novartis kept its full-year 2026 outlook unchanged. The company expects net sales to grow at a low single-digit rate and core operating income to decline by a low single-digit percentage at constant currencies.
CEO Vas Narasimhan said the quarter showed a “solid” return to sales growth and that the company remains “on track to deliver our full-year guidance and mid-term outlook.”
Free cash flow fell 12% to $5.56 billion. Net debt rose to $39.4 billion at the end of June, up from $21.9 billion at end of 2025. The increase was driven by $15.3 billion in acquisition and intangible asset spending, a $9.1 billion dividend payment, and $3.1 billion in share buyback activity.
Pipeline in Focus
Investors are watching three experimental drugs closely — pelacarsen, remibrutinib, and del-desiran. Analysts estimate the trio could generate up to $10 billion in peak annual sales.
That pipeline matters because Cosentyx and Kisqali, two of Novartis’ current growth drivers, are set to lose patent exclusivity beyond 2030.
Cosentyx posted 12% growth to $1.82 billion in Q2, partly boosted by a roughly $100 million one-off benefit in the US.
In July, Novartis agreed to acquire Myricx Bio, a biotech developing antibody-drug conjugates, with the deal expected to close in the second half of 2026.
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