Pfizer’s modest 2026 outlook shows its big investments will take time to pay off

Pfizer on Tuesday forecast modest 2026 guidance as it looks to longer-term investments in its pipeline to counter waning Covid product sales and declines from older drugs.

Those hurdles aren't surprising or new for Pfizer, which has seen a dramatic decline in Covid vaccine and antiviral sales after raking in record-setting revenue during the pandemic. The drugmaker has pursued deals of all sizes in recent years to build new revenue streams, such as its recently closed $10 billion acquisition of the obesity biotech Metsera and the whopping $43 billion tie-up for cancer drugmaker Seagen in 2023.

But the guidance underscores that those investments are still some distance from paying off. Metsera, for example, brings a pipeline of drugs that are still in early-stage development.

Shares of the company slid nearly 5% on Tuesday. The stock is also down about 5% for the year.

The drugmaker expects adjusted profit to come in between $2.80 and $3 per share next year. That's slightly below analysts' consensus estimate of $3.05 per share for the year, according to LSEG. 

Revenue is expected to total $59.5 billion to $62.5 billion, which would largely be flat compared to Pfizer's new 2025 sales guidance of $62 billion. Analysts were expecting 2026 sales of $61.59 billion, LSEG estimates said. 

The company said the lackluster revenue outlook comes in part from declining sales of its Covid vaccine and antiviral pill Paxlovid. Pfizer forecasts 2026 sales from these products will fall by about $1.5 billion year-over-year to $5 billion. 

Pfizer also pointed to another roughly $1.5 billion year-over-year expected drop in sales due to certain products losing their market exclusivity. Some blockbuster drugs, such as the company's pneumonia vaccine Prevnar, are facing more competition from rivals.

Pfizer's patent expirations are primarily expected to occur in 2026 and 2028, the company's CFO Dave Denton said on an investor call Tuesday. He said the drugmaker expects $17 billion in revenues to be impacted by patent and regulatory exclusivity expirations. 

The blood thinner Eliquis, among the company's top sellers, will also have lower prices in Medicare starting next year after negotiations with the government as part of the Inflation Reduction Act. Some analysts also noted that the guidance likely reflects costs tied to the company's recent acquisitions, including Metsera.

In a note Tuesday, JPMorgan analyst Chris Schott called the outlook "largely expected." He said the Covid headwinds and research and development investments will be partially offset by ongoing restructuring at the company. 

On an investor call Tuesday, Pfizer said it exceeded its cost-saving goals for 2025. The company is targeting more than $7 billion in cost cuts by 2027, and said Tuesday that it expects to deliver the majority of those savings by next year.

Meanwhile, BMO Capital Markets analyst Evan Seigerman said the slightly lower 2026 outlook "leaves room [for] adjustments in light of vaccine policy uncertainty." 

Pfizer and other drugmakers have had to grapple with changes to U.S. vaccine policy under Health and Human Services Secretary Robert F. Kennedy Jr., a prominent shot skeptic. 

"Given uncertainty with HHS policy, and infection rates we appreciate conservative estimates and cost-savings … heading into the new year," Seigerman said. 

On the call, Pfizer CEO Albert Bourla said comments by the Food and Drug Administration around shots "don't have merit" and are "not going to change the way we are looking at our long term investments in vaccines." Bourla did not point to specific remarks, but said he believes "this anomaly will correct itself."

Earlier this year, Pfizer struck a landmark drug pricing deal with the Trump administration, which includes selling its existing drugs to Medicaid patients at the lowest price offered in other developed nations. Pfizer will also guarantee the same "most-favored-nation" pricing on its new drugs for Medicare, Medicaid and commercial payers.

In return, the company will get a three-year exemption from President Donald Trump's pharmaceutical-specific tariffs. 

Denton said there is "price compression and margin compression baked into" the company's 2026 guidance as it plans to provide "deeper discounts" in its Medicaid business as part of the deal with Trump.