New York, February 4, 2026, 12:39 (EST) — Regular session
- Merck shares gained roughly 3% mid-session, with investors actively trading ahead of the company’s 2026 forecast
- Merck projected 2026 sales will fall short of estimates, citing a $2.5 billion drag from aging drugs and pricing pressure
- Keytruda pushed Q4 results above expectations, but Gardasil plunged amid soft demand in China
Merck & Co shares (MRK) climbed roughly 2.8% to $119.11 by midday in New York on Wednesday, gaining $3.27 since Tuesday’s close. The stock’s intraday range has been between $115.79 and $119.93.
This shift isn’t just about last quarter—it’s about what’s coming next. Investors are focused on whether Merck can sustain growth as its older drugs decline and U.S. price pressures hit the financials sooner than expected.
Merck on Tuesday projected 2026 revenue between $65.5 billion and $67.0 billion, falling short of the $67.6 billion average analyst forecast. The company pointed to a $2.5 billion impact from generic competitors, Medicare pricing discussions, and softer sales of its COVID-19 treatment Lagevrio. CEO Rob Davis attributed the “disconnect” with Wall Street to patent expirations on older drugs. Evan Seigerman of BMO Capital described the quarter as a “reasonable foundation.” 1
Merck beat expectations with fourth-quarter sales hitting $16.4 billion, a 5% increase, and non-GAAP EPS at $2.04, excluding some one-time charges. Yet, its 2026 guidance left investors hesitant, projecting non-GAAP EPS between $5.00 and $5.15, factoring in an acquisition-related hit. Keytruda sales rose 7% to $8.37 billion, while Gardasil dropped sharply by 34% to $1.03 billion during the quarter.
In a separate statement, Davis noted that demand for newer cardiometabolic and respiratory launches, along with growth in animal health, supported the business in 2025. He added that “momentum is building” as the portfolio evolves. Merck has bolstered its lineup beyond oncology through deals, including acquisitions of Verona Pharma and Cidara Therapeutics. 2
Analysts keep returning to one key issue: the 2026 outlook could carry more weight than the Q4 earnings beat. Cantor analyst Carter Gould told clients the real focus was always on the “’26 guide” optics. MarketWatch highlighted the pipeline as a make-or-break scenario, with crucial Phase 3 readouts due in 2026, including enlicitide and islatravir. 3
On Tuesday, Merck filed an 8-K that detailed the results along with supporting tables, including their earnings release and supplemental schedules.
The near-term outlook could sour fast. Should Gardasil demand remain sluggish in China, or if generic competition ramps up for Januvia and its diabetes portfolio, quarterly sales could take a sharp hit.
Loss of exclusivity means patents expire, letting cheaper versions flood the market. Medicare negotiations involve the U.S. program’s power to set prices on certain drugs, a factor increasingly shaking up company forecasts.
In the days following the earnings call, traders will be eyeing any revisions to estimates and updates on vaccine demand, especially the pace at which older brands are fading. Buzz around potential deals could still swing this stock on news alone.
Merck’s first-quarter earnings call is set for April 30. 4
