Merck Q3 2025 earnings: Keytruda tops $8 billion, guidance nudged higher
Merck's Q3 2025 revenue rose 4% to $17.3 billion, led by Keytruda topping $8 billion for the first time, while it modestly raised full-year guidance.
| Q3 2025 | Reported |
|---|---|
| EPS | $2.32 |
| Revenue | $17.28B |
Figures as reported by the company to the SEC for the quarter ended September 30, 2025. Analyst estimates are not part of a filing, so no comparison to expectations is shown.
Key takeaways
- Keytruda, Merck’s top-selling cancer immunotherapy, topped $8 billion in quarterly sales for the first time, growing 10% as it’s increasingly used in earlier-stage cancers rather than just advanced disease.
- Winrevair, Merck’s pulmonary arterial hypertension drug, kept ramping up quickly, with sales more than doubling to $360 million since its 2024 launch.
- Gardasil, Merck’s HPV vaccine, was a weak spot: sales fell 24% to $1.7 billion, continuing a slump tied largely to soft demand in China.
- Merck slightly raised its full-year 2025 outlook, now projecting revenue of $64.5-65 billion and adjusted (non-GAAP) earnings of $8.93-8.98 per share, a modest bump from its previous forecast.
- Management highlighted a cost-cutting plan targeting $3 billion in savings by 2027, part of the company’s preparation for Keytruda losing US patent protection in 2028, after which lower-cost competing versions could cut into sales of its biggest product.
- Merck’s gross margin has stayed high, near 77% over the past year, meaning the core business of making and selling its drugs remains very profitable before other costs are counted.
- That strength doesn’t fully carry through to the bottom line: trailing twelve-month operating and net margins were much thinner, and earnings per share were down sharply versus a year earlier on that same basis, a gap driven mainly by one-time charges from acquisitions and R&D deal payments rather than weaker drug sales.
- The quarter’s reported (GAAP) earnings included a $0.10-per-share charge for a milestone payment to LaNova Medicines tied to a licensing and technology-transfer agreement.
Q3 2025 in context
| Metric | Sep 2025 | Sep 2024 | Change |
|---|---|---|---|
| Revenue | $17.3B | $16.7B | +3.7% |
| Net income | $5.8B | $3.2B | +83.2% |
| Free cash flow | $6.8B | $8.5B | -19.7% |
| Diluted EPS | $2.32 | $1.24 | +87.1% |
| Gross margin | 77.7% | 75.5% | +2.2 pts |
| Net margin | 33.5% | 19.0% | +14.5 pts |
Figures for the quarter ended Sep 2025 and the quarter ended Sep 2024, as reported to the SEC.
How the stock took it
Merck & Co Inc closed at $83.86 on Nov 4, 2025, the last session before the report, and at $85.78 on Nov 6, 2025, the first session after it — +2.3% across the report.
Closes from the market's daily record. Each figure spans the report date — from the last session that closed before it to the first that closed after — because a company may report before the open or after the close.
Sources: company report · earnings call