Abstract

Alkermes PLC is scheduled to report its quarterly results on February 25, 2026 Pre-Market, with investor focus on the initial quarter of Avadel integration, the expected transaction-related charges, and the company’s guidance for 2026.

Market Forecast

Consensus expectations for Alkermes PLC point to revenue of $381.85 million for the current quarter, implying 0.56% year-over-year growth, with estimated earnings per share at $0.33 and EBIT at $60.60 million, reflecting year-over-year declines of 58.31% and 52.25% respectively; explicit gross margin or net margin forecasts were not disclosed. The main revenue engine remains the “Products, net” portfolio, and near-term outlook suggests modest top-line expansion but materially lower earnings as one-time and integration-related expenses from the Avadel acquisition are recognized. The segment with the strongest near-term contributions is “Products, net,” which generated $317.42 million last quarter; overall revenue rose 4.24% year-over-year last quarter and is forecast to grow 0.56% year-over-year this quarter.

Last Quarter Review

Alkermes PLC delivered last quarter revenue of $394.19 million (up 4.24% year-over-year), a gross profit margin of 86.91%, GAAP net profit attributable to the parent company of $82.76 million, a net profit margin of 21.00%, and adjusted EPS of $0.49 (down 31.94% year-over-year). A notable highlight was profitability and execution ahead of acquisition close: EBIT reached $89.08 million versus an estimate of $53.18 million, a positive surprise of $35.90 million, and adjusted EPS outperformed estimates by $0.19, while revenue surpassed consensus by $38.04 million. The main business mix featured “Products, net” revenue of $317.42 million and “Manufacturing and use” revenue of $76.76 million, with total company revenue rising 4.24% year-over-year.

Current Quarter Outlook

Products, net: revenue base, margin profile, and near-term cadence

“Products, net” underpinned the company’s revenue last quarter at $317.42 million, accounting for the majority of the $394.19 million total. The segment’s high-margin profile aligns with the company-level gross margin of 86.91% reported last quarter, and it remains the anchor for near-term revenue stability. This quarter’s modest top-line growth forecast (+0.56% year-over-year) suggests a relatively steady demand profile across the proprietary portfolio, yet earnings will be constrained by one-time and integration-related items, rather than by underlying revenue generation. Operationally, retention of pricing, unit demand, and disciplined cost control in the core portfolio are central to preserving the gross-margin foundation in the face of expenses linked to the Avadel deal. The mix of contributions within the “Products, net” portfolio will matter for reported metrics, but given the scale of non-operational charges expected in the quarter, EPS and EBIT will reflect these below-the-line burdens more than any substantial changes in core product revenues.

Avadel integration and Lumryz: one-time charges now, accretive potential later

On February 12, 2026, Alkermes PLC completed the acquisition of Avadel, adding Lumryz to the company’s commercial portfolio and financing the transaction with approximately $1.53 billion in term loans due 2031 and about $775.00 million in cash. Management indicated that the quarter would include transaction-related expenses of about $40.00 million, a step-up of approximately $180.00 million on Lumryz inventory, net interest expense of $75.00 million to $85.00 million, and amortization of intangible assets of $95.00 million to $105.00 million. These items are expected to weigh on reported earnings in the current period, creating substantial headwinds for EPS and EBIT despite steady core revenues. The inventory step-up will elevate cost of sales when those units are recognized, pressuring gross margin temporarily relative to last quarter’s 86.91% baseline. Higher interest expense from the new debt structure and intangible amortization will also compress net margin and reduce EPS, consistent with forecasts that imply a 58.31% year-over-year decline in EPS and a 52.25% year-over-year decline in EBIT. While near-term results will be burdened by integration costs and accounting effects, management has communicated that the deal is expected to be accretive in 2026, and the update to combined-company expectations is planned for February 25, 2026. The trajectory from Q2 onward should reflect diminishing one-time charges, clearer operating cadence for Lumryz, and potential uplift from portfolio breadth, provided the integration track meets execution milestones.

Key stock-price drivers this quarter: revenue resilience vs. non-operational charges and guidance clarity

The tug-of-war in the share price over the next several weeks is likely to hinge on the interplay between steady revenue performance and the gravity of non-operational charges. With consensus calling for $381.85 million in revenue (+0.56% year-over-year), the top line appears resilient; however, the current quarter’s EPS and EBIT declines on a year-over-year basis are driven primarily by transaction-related accounting and financing impacts rather than deterioration in the revenue base. Investors will focus on the magnitude and phasing of the inventory step-up recognition in cost of sales, the run-rate implications of the new interest burden, and the amortization schedule of intangibles introduced with the Avadel deal. The February 25, 2026 guidance for the combined company becomes a major catalyst: clarity on pro forma revenue, margin normalization timelines, and the path to accretion will be critical in shaping expectations for the remainder of 2026. Another focal point will be how the revenue mix evolves as Lumryz is integrated, and how management frames the normalization of gross margin once inventory step-up effects roll off. Finally, the surprise potential in adjusted metrics—excluding one-time integration items—will be closely watched, as it can help investors separate ongoing operating performance from transient accounting noise.

Analyst Opinions

Bullish views dominate in the current window, with the ratio of bullish to bearish opinions at 100% to 0%. Mizuho Securities analyst Uy Ear reiterated a Buy rating on Alkermes PLC and set a $45.00 price target in January 2026, signaling confidence in the company’s ability to navigate near-term charges and unlock accretive benefits from the Avadel acquisition. The analyst’s stance aligns with a framework where the current quarter’s EPS and EBIT declines are largely non-recurring or front-loaded, while the top-line remains intact and poised to broaden with the addition of Lumryz. From a modeling perspective, the forecast revenue of $381.85 million (+0.56% year-over-year) indicates continuity in the core portfolio’s contribution, and the magnitude of expected charges explains the sharp year-over-year compression in EPS and EBIT without implying structural weakness in demand. In this context, the central thesis among bullish institutions is that valuation should be assessed against normalized margins after the inventory step-up and integration costs subside, and that cash-flow visibility will improve as interest and amortization burdens are embedded in forward estimates. Investors will look for management’s combined-company guidance on February 25, 2026 to validate this thesis, with particular attention on the timeline to margin recovery, the cadence of debt service, and the earnings bridge from reported to adjusted figures. The consistency between the revenue outlook and the acquisition’s promised accretion in 2026 supports the bullish view that, once transitory costs are absorbed, Alkermes PLC can return to an earnings trajectory more reflective of its core revenue base and the incremental contributions from the newly added product. In sum, the majority institutional perspective emphasizes patience through a noisy quarter, the distinction between one-time and recurring items, and the importance of the upcoming guidance in establishing a clearer path for EPS normalization in the second half of 2026.