Regeneron Pharmaceuticals (NASDAQ: REGN) reported first-quarter financial results that surpassed Wall Street expectations, though ongoing headwinds in its Eylea franchise and a regulatory setback tempered investor enthusiasm. The stock slipped 1.1% in premarket trading following the release.
Financial Highlights
For the quarter ended March 31, 2026, Regeneron posted revenue of $3.605 billion, a 19% increase year-over-year, and adjusted earnings of $9.47 per share. Both figures exceeded analyst consensus estimates of $3.49 billion in revenue and $8.94 in adjusted profit, according to LSEG data cited by Reuters. The company filed a Form 8-K with the SEC detailing the results.
Key Product Performance
Dupixent, co-marketed with Sanofi, continued to be a growth driver, with global net sales climbing 33% to $4.88 billion, surpassing the $4.59 billion expected by analysts. Recent approvals, including for young children with chronic spontaneous urticaria, fueled demand. Libtayo also performed well, generating $438 million in revenue, up 54% from the prior year.
In contrast, the Eylea franchise faced headwinds. U.S. sales of Eylea HD, the higher-dose formulation, rose 52% to $468 million, but combined sales of Eylea HD and the original Eylea fell 10% to $941 million. The decline reflects increasing competition from lower-priced biosimilars and Roche's Vabysmo.
Regulatory and Operational Challenges
The FDA missed its April deadline to decide on a second contract manufacturer for the Eylea HD pre-filled syringe. Regeneron now expects a decision in the second quarter. Additionally, the company lowered its 2026 GAAP gross-margin outlook to 77%-78%, down from 79%-80%, citing an unexpected facility repair at its Limerick, Ireland site that temporarily disrupted bulk manufacturing. Production has resumed, and the company expects no impact on product availability.
Capital Allocation and Pipeline
Regeneron repurchased $803 million in shares during the quarter, authorized a new $3 billion buyback program, and declared a dividend of $0.94 per share. CEO Leonard S. Schleifer highlighted strong double-digit growth and a pipeline nearing 50 clinical candidates. CFO Christopher Fenimore emphasized a balanced approach to capital allocation.
Market Context and Analyst Views
RBC Capital Markets analyst Brian Abrahams noted that the stock's muted response was unsurprising given weaker Eylea HD sales, the regulatory overhang, and the company's decision to halt late-stage development of a lung cancer combination therapy. Goldman Sachs analyst Salveen Richter pointed to upcoming Phase 3 results for fianlimab in metastatic melanoma as a potential swing factor, with progression-free survival a key data point.
Investors remain cautious about the competitive pressures on Eylea, the FDA delay, and manufacturing costs. If these issues persist, Dupixent and Libtayo will need to shoulder even more of the growth burden as the legacy Eylea line continues to lose market share.
