Merck's Stock Faces Premarket Decline After Earnings Announcement

Merck & Co. Inc. (MRK) has seen a significant decline in its stock price during premarket trading today, with a drop of $7.95, or 8%, bringing the current price down to $91.84. This movement follows the company’s release of its fourth-quarter and full-year 2024 financial results.

Despite reporting a 7% increase in fourth-quarter worldwide sales to $15.6 billion compared to the previous year, the overall earnings report reveals mixed results for some of Merck’s flagship products. Notably, sales of GARDASIL declined by 17%, reflecting lower demand in certain markets.

In contrast, the sales of KEYTRUDA, Merck's blockbuster cancer therapy, grew by 19%, contributing to total worldwide sales of $64.2 billion for the full year, a 7% increase year-over-year. This growth showcases the continued demand for oncology products amidst ongoing competition and market challenges.

Merck's adjusted non-GAAP earnings per share (EPS) for the fourth quarter was reported at $1.72, compared to just $0.03 in the same quarter last year. The company's GAAP EPS stood at $1.48, a significant rise from a loss per share of $0.48 a year prior.

While the company focused on its pharmaceutical segment, which saw an overall growth of 7%, there were adverse impacts noted from foreign exchange rates and some product declines that could influence investor sentiment moving forward.

Looking ahead, Merck's financial outlook for 2025 anticipates worldwide sales between $64.1 billion and $65.6 billion, suggesting potential stability despite recent market fluctuations. However, the pause in shipments of GARDASIL into China may affect their performance in that key market.

As investors react to this latest financial news, it remains to be seen how these earnings results and the market's perception of Merck’s growth strategies will influence stock performance in the coming weeks.