Eli Lilly surges after smashing Q4 estimates, raising 2026 guidance
Strong Mounjaro and Zepbound sales drive 43% revenue growth to $19.3B, well above analyst expectations
Eli Lilly reported fourth-quarter 2025 financial results that dramatically exceeded Wall Street expectations, driven by explosive growth in its diabetes and weight-loss treatments, sending shares higher in pre-market trading before broader market pressures took hold.
The Indianapolis-based pharmaceutical giant posted revenue of $19.3 billion for the final quarter of 2025, a 43% year-over-year increase that comfortably surpassed the average analyst estimate of approximately $17.87 billion, according to MarketScreener. Adjusted earnings per share reached $7.54, beating consensus expectations of $6.99 per share and marking a significant acceleration from the prior year.
The standout performance came from Lilly's GLP-1 franchise, with Mounjaro generating $7.4 billion in quarterly sales—a 110% year-over-year surge—while Zepbound contributed $4.3 billion, up 123% from the same period in 2024. The two medications, which treat type 2 diabetes and obesity respectively, have become cornerstone products in Lilly's portfolio amid surging global demand for effective weight-loss therapies.
Based on the strong quarterly performance and its expanding production capacity, Lilly issued an optimistic outlook for 2026, projecting full-year revenue between $80 billion and $83 billion, with non-GAAP earnings per share expected to reach $33.50 to $35.00. Both the revenue and EPS guidance exceed current consensus estimates, according to PR Newswire.
"2025 was an important year... positioned to reach more patients than ever," the company's chief executive stated in the earnings announcement, highlighting Lilly's strategic investments in manufacturing expansion to meet continued demand for its GLP-1 therapies.
Despite the earnings beat, the stock's performance proved volatile. Shares initially rallied 5% in pre-market trading following the announcement, according to Seeking Alpha, but reversed course during regular trading sessions, closing down 3.9% on February 4th as broader market pressures and sector rotation weighed on pharmaceutical stocks. The stock remains near its 52-week high of $1,133.95, having gained substantial ground throughout 2025.
Analysts maintain a largely bullish stance on Lilly's prospects despite the day's share price decline. The company carries a consensus "Strong Buy" rating among covering analysts, with an average 12-month price target of approximately $1,162 to $1,204, suggesting potential upside of 12% to 16% from current levels around $1,003, according to MarketBeat. The most optimistic price target reaches $1,500.
Looking ahead, investors are closely watching Lilly's pipeline development, particularly the regulatory approval process for orforglipron, an oral GLP-1 drug that could provide a significant new growth vector in 2026 if approved. The company has submitted applications to U.S., Japanese, and European Union regulators for the oral medication targeting both obesity and type 2 diabetes.
However, analysts have flagged several potential risks that could temper future gains. These include the possibility of GLP-1 price wars, the impact of Medicare price negotiations, and patent cliffs for legacy products. Competition from Novo Nordisk's oral version of Wegovy also represents a looming challenge in the weight-loss market.
Lilly's substantial capital expenditures for new manufacturing facilities, while necessary to support growth, introduce execution risks that investors will monitor closely in the coming quarters, according to Trefis analysis.
The company, which operates in approximately 125 countries and reported a market capitalization of $936 billion, continues to distinguish itself through its focused therapeutic areas in diabetes, oncology, and neurodegenerative diseases. With a trailing price-to-earnings ratio of 51.3 and a forward P/E of 31.5, investors are pricing in continued robust growth from the GLP-1 franchise while awaiting pipeline catalysts.