• Group Sales: Up 4% in Q1 2025.
• Operating Profit: Increased by 5%.
• Core Earnings Per Share: Rose 5% to GBP 0.449.
• Specialty Medicines Sales: Up 17%.
• Vaccine Sales: Down 6%.
• Cash Generated from Operations: Over GBP 1 billion.
• Dividend: Increased to GBP 0.16 per share.
• Share Buyback Program: GBP 2 billion commenced.
• Sales in Q1: GBP 7.5 billion, up 4% year-over-year.
• Europe Sales Growth: Up 11%.
• U.S. Sales Growth: Up 4%.
• Oncology Sales: Up 53%.
• HIV Sales Growth: Up 7%.
• Vaccine Sales for Q1: Over GBP 2 billion, down 6%.
• General Medicine Sales: Stable, with respiratory sales up 1%.
• Core Operating Margin: Improved to 33.5%.
• Cash Generated from Operations (excluding Zantac payments): GBP 1.4 billion.
• Free Cash Flow (excluding Zantac payments): Improved by GBP 0.5 billion.
• Royalty Income for 2025: Expected to be GBP 750 to 800 million.

• Warning! GuruFocus has detected 2 Warning Sign with GSK.

Release Date: April 30, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• GSK PLC (NYSE:GSK) reported a 4% increase in group sales and a 5% rise in operating profit, demonstrating the strength and resilience of its portfolio.
• Specialty medicines, the largest business segment, grew by 17%, driven by strong performances in respiratory, immunology, inflammation, oncology, and HIV.
• The company completed the acquisition of IDRX, adding a promising oncology asset to its pipeline.
• GSK PLC (NYSE:GSK) generated over GBP1 billion in cash from operations, supporting further investment in growth and shareholder returns.
• The company confirmed its financial guidance for 2025, indicating confidence in continued profitable growth.

Negative Points

• Vaccine sales were down 6%, with the pace of penetration in the US slowing due to high immunization rates.
• The introduction of the Inflation Reduction Act (IRA) is expected to be a GBP400 million to GBP500 million headwind throughout the year.
• General medicine sales were broadly stable, with some areas experiencing declines due to generic competition.
• The macro environment presents elevated levels of uncertainty, including potential sector tariffs.
• The company faces challenges in the US vaccines market, with potential impacts from political rhetoric and regulatory hurdles.

Q & A Highlights

Q: What are your expectations for the upcoming launches of Newuara COPD and Glenrep? Could there be strong uptake in H2 2025, or are these more 2026 stories? Also, how might tariffs impact GSK, and what are the mitigating strategies? A: (Dame Emma Walmsley, CEO) We are excited about the new launches. For Newuara COPD, the May 7th PDUFA is on track, and we expect strong physician interest. However, pulmonologists are generally conservative, so uptake might be gradual. For Glenrep, we are cautious about immediate contribution due to the need for careful management of ocular side effects. Regarding tariffs, we have prepared multiple strategies, including regional supply chain resilience and productivity improvements, to mitigate potential impacts.

Q: How is the new US administration affecting vaccine demand, especially in the pediatric space, and what is the impact of Medicare Part D redesign on GSK? A: (Dame Emma Walmsley, CEO) We are cautious about the vaccine market, but we are where we expected to be. The Medicare Part D redesign impact is within expectations, with HIV being the largest affected area. (Julie Brown, CFO) The impact is spread evenly throughout the year, with HIV contributing GBP150-200 million of the total GBP400-500 million headwind.

Q: Can you explain how GSK manages SGNA growth while launching new products, and how tariffs might affect your supply chain? A: (Julie Brown, CFO) We manage SGNA growth by reallocating resources from mature lines and using marketing models to optimize investment. Our supply chain is complex, but most products touch the US, allowing us to absorb potential tariffs through customs value calculations. We are confident in our dual sourcing and productivity initiatives.

Q: What are the dynamics within the PREP market, and is there any impact from the US aid shutdown on clinical trial recruitment? A: (David Redfern, President-Corporate Development) The PREP market is underdeveloped, with only a third of potential beneficiaries receiving it. We see opportunities to switch oral patients to long-acting injectables. The US aid shutdown has not directly impacted our trials, but we are working with the community to address broader impacts.

Q: What is GSK's long-term HIV strategy, and how do you view the potential impact of long-acting orals from competitors? A: (David Redfern, President-Corporate Development) We focus on long-acting injectables, with promising data for our VH 184 asset. We believe long-acting injectables offer clear patient preference, and while we monitor long-acting orals, we expect them to primarily cannibalize daily orals.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.