Johnson & Johnson outperformed Wall Street expectations with its quarterly sales and raised its full-year outlook, signaling corporate resilience amid dual threats of tariffs and drug pricing controls facing the pharmaceutical sector. The healthcare giant reported second-quarter revenue of $23.7 billion, surpassing analysts' average projection of $22.8 billion.
The company's upgraded forecast comes against a backdrop of heightened uncertainty. President Donald Trump renewed tariff threats against drugmakers this week, warning of potential levies by month-end—just days after suggesting a 1-18 month grace period. "Initial tariffs would be relatively low," Trump told reporters Tuesday night, "followed by very high tariffs," reversing his earlier position communicated during a cabinet meeting where he'd threatened 200% tariffs unless production shifted stateside.
J&J CFO Joe Wolk interpreted the initial tariff delay positively, noting: "This shows recognition that biopharma manufacturing facilities can't be built overnight. As long as dialogues continue, we're in a reasonably good position." Consequently, J&J halved its projected 2025 tariff impact to $200 million—a figure reflecting existing duties, not potential future industry-specific tariffs.
Despite headwinds, J&J lifted its full-year revenue midpoint by $2 billion to $93.4 billion and raised adjusted EPS guidance by 25 cents to $10.80-$10.90. Key growth drivers included cancer therapy Darzalex ($3.54 billion sales, beating estimates) and immunology drug Tremfya ($1.19 billion, above forecasts). Wolk projected Tremfya—newly approved for inflammatory bowel disease—could achieve $10 billion peak annual sales. Medical devices also exceeded expectations with $8.54 billion revenue.
Challenges persist as Stelara, J&J's psoriasis blockbuster facing generic competition after key patent expirations in the U.S. and Europe, posted $1.65 billion sales—below estimates and signaling potentially faster decline for this cash cow. Legal uncertainties mounted as a federal judge rejected J&J's talc-litigation settlement strategy, forcing individual courtroom battles over cancer allegations tied to its baby powder.
As the first major healthcare firm to report quarterly results, J&J serves as an industry bellwether amid mounting pressures. Beyond tariffs, drugmakers confront potential policies targeting U.S. drug prices—including White House threats to mandate prices no higher than those charged in other wealthy nations. In May, Trump ordered companies to voluntarily cut prices or face regulatory action, while pushing foreign nations to pay more for prescriptions.
J&J's performance follows its March pledge to invest over $55 billion domestically over four years—part of broader industry commitments made since Trump's inauguration—though specific allocation across manufacturing, R&D, and technology remains undisclosed.