AstraZeneca posts 5% revenue growth as oncology sales drive Q2 beat

AstraZeneca PLC reported a 5% increase in currency-adjusted revenue for the second quarter, driven by continued strength in its oncology portfolio.

"The results reflect strong momentum across our targeted therapies and core markets," Pascal Soriot, chief executive officer of AstraZeneca, said.

The oncology segment grew 16% from a year earlier, led by Tagrisso, Imfinzi, Lynparza, Calquence and the Enhertu partnership with Daiichi Sankyo. Oncology sales now account for 44% of total company revenue, up from 40% a year ago, according to the company's earnings statement. Earnings per share exceeded the consensus estimate of $1.27, according to analyst data.

The results follow recent regulatory wins. The European Union last week approved Enhertu in combination with pertuzumab as a first-line treatment for HER2-positive metastatic breast cancer, based on data showing a 44% reduction in the risk of disease progression or death. The company also received a positive EU recommendation for Trixeo Aerosphere in asthma.

AstraZeneca shares closed at $169.26 on Friday before the release, giving the company a market capitalization of $262.5 billion. The stock trades at 25.6 times trailing earnings, near its five-year low of 25.4, with a consensus analyst price target of $213.89 implying roughly 26% upside. The stock's 52-week range spans $142.98 to $212.71.

The company's oncology growth outpaces rivals including Merck & Co. and Pfizer, which reported slower segment expansion in their most recent quarters. AstraZeneca's trailing 12-month revenue stands at $60.4 billion, with a profit margin of 17.2 percent and return on equity of 23.5 percent. The company employs about 96,100 people and generates roughly one-third of its revenue from the US market.

The results show that AstraZeneca's oncology-led strategy continues to deliver growth as the company expands its pipeline. The company faces upcoming patent expirations on some key drugs but has a deep pipeline of late-stage candidates to offset potential revenue losses. Investors will watch the earnings call later Monday for updated guidance on margins and pipeline milestones.

This article is for informational purposes only and does not constitute investment advice.