Johnson & Johnson Q3 2026 earnings: CEO and CFO prepared remarks

Below are the CEO and CFO prepared remarks from Johnson & Johnson’s third-quarter 2026 earnings call. For the complete transcript, financial results, supplemental materials and additional information, please visit our Investor Relations website . Remarks by Joaquin Duato, Chairman and Chief Executive Officer Our strong performance in the third quarter reinforces our confidence in 2026 as a year of accelerated growth and impact for Johnson & Johnson. In Q3, we reported operational sales growth of 6%—ahead of analyst consensus—and increased sequential growth compared to the second quarter. With six strategic focus areas—Oncology, Immunology, Neuroscience, Cardiovascular, Surgery, and Vision—we are leading in areas of high unmet need where innovation can make the greatest difference for patients. Our powerful combination of Innovative Medicine and MedTech expertise strengthens our competitiveness. Twenty-nine of our products and platforms now generate at least $1 billion in annual sales. Our marketed portfolio continues to perform, our launches are gaining significant traction, and we are advancing our new product pipeline that will sustain our growth into the next decade. With sales in the quarter of more than $25 billion, we are on track to meet our guidance and exceed $100 billion in annual revenue for the first time in our Company’s 140-year history. As we advance our differentiated portfolio and pipeline, we have a clear path to double-digit growth by the end of the decade. Innovative Medicine In Innovative Medicine, we delivered operational sales growth of 7.9%, with eight brands growing double digits. Let’s start with Oncology. We are making progress to redefine cancer care from treatment to cure. In the third quarter, our Oncology business grew approximately 17%. Our multiple myeloma portfolio and pipeline are unmatched, with 80% of patients receiving a Johnson & Johnson therapy as part of their treatment journey. And we continue to strengthen the body of evidence supporting our recently launched multiple myeloma therapies and combination regimens. New Phase 3 results announced in July demonstrated that the combination of TECVAYLI plus TALVEY reduced the risk of disease progression or death by 89% as early as the second line of treatment. In solid tumors, sales of RYBREVANT increased by 64%, reflecting its strength in lung cancer. And, by the end of the year, we expect to receive U.S. FDA approval for RYBREVANT FASPRO in advanced head and neck cancer, a disease with significant unmet needs. In bladder cancer, INLEXZO has rapidly emerged as a market leader for new patient share, just one year after its launch. Nearly one in three eligible patients started on an INLEXZO regimen in the third quarter, demonstrating its growing role in transforming care in high-risk, non-muscle invasive disease. During the quarter, we also invested to bolster our Oncology pipeline. We completed our acquisition of Firefly Bio, adding a promising new degrader antibody conjugate platform that targets drivers of difficult-to-treat cancers, including KRAS. Our ambition is to become the #1 Oncology company by 2030, with sales projected to exceed $50 billion. Turning to Immunology , we are building on our 25-year legacy to drive industry-leading innovation for patients. TREMFYA delivered exceptional sales growth of 68% in the quarter, reflecting strong momentum across its indications. In the U.S., it is now the #1 IL-23 inhibitor in new-to-brand share in Crohn’s disease, ulcerative colitis, and psoriatic arthritis. And we continue to generate evidence that reinforces TREMFYA’s clinical differentiation. Based on the landmark STAR study, TREMFYA is the first and only IL-23 inhibitor to demonstrate positive outcomes in axial disease clinical trials, including significant improvements in spinal pain, stiffness, and inflammation in patients with psoriatic arthritis. This momentum reinforces our conviction in TREMFYA as a foundational medicine in inflammatory bowel and psoriatic diseases—and our belief that it can grow into a $10 billion-plus franchise. ICOTYDE, our first-in-class targeted oral peptide for plaque psoriasis, continues to outpace recent competitors’ launches. More than 20,000 patients have initiated therapy through nearly 9,000 prescribers since ICOTYDE’s launch in the U.S. We continue to make strong progress on commercial access, with ICOTYDE now broadly covered across all national plans. Also this quarter, IMAAVY was approved as the first advanced treatment specifically for warm autoimmune hemolytic anemia, a rare, life-threatening disease that causes severe anemia and fatigue. This new indication builds on IMAAVY’s momentum in generalized myasthenia gravis and reflects its broad potential across autoantibody diseases. And we continue to pursue next-generation therapies. In July, we announced a collaboration with Sail Biomedicines to advance in vivo CAR-T approaches for immune-mediated diseases. Next, in Neuroscience , we aim to transform the future of brain health by addressing complex nervous system disorders. Today, we are the definitive leader in neuropsychiatry. CAPLYTA reached $1 billion in year-to-date sales, making it our 29th billion-dollar platform. Driven by strong uptake as an adjunctive treatment for major depressive disorder, CAPLYTA is now the fastest-growing oral branded therapy in this space. And last month, we presented pivotal Phase 3 data that showed CAPLYTA significantly and rapidly improved symptoms of bipolar mania. SPRAVATO also delivered impressive growth of 36% this quarter, reflecting strong demand in treatment-resistant depression. MedTech Now let’s turn to MedTech, where we delivered Q3 operational sales growth of 2.5%. While we fell short of our expectations for the segment, our conviction in our future direction has not changed. Starting with Cardiovascular , we continue to invest in heart recovery, circulatory restoration, and heart rhythm disorders to address the leading global cause of death. This was another strong quarter for SHOCKWAVE, our Circulatory Restoration business, which grew 17%. The ongoing global launch of SHOCKWAVE C2 AERO continues to broaden the reach of our intravascular lithotripsy platforms. VARIPULSE, our pulsed field ablation platform, reached a major milestone this quarter, with more than 100,000 AFib patients treated worldwide. VARIPULSE Pro, which delivers five-times faster ablation speed, has been very well received in Europe, where it is driving double digit growth. And just last week, we received approval for VARIPULSE Pro in Japan. With increasing clinical experience, we are seeing differentiated benefits from VARIPULSE. In a recent retrospective analysis, VARIPULSE demonstrated a 68% lower risk of adverse cardiac events compared to a competing pulsed field ablation platform. And in Heart Recovery, while physician selectivity continued to affect ABIOMED performance, we remain confident in the technology and focused on supporting appropriate patient selection. In Surgery , we are poised to shape the next era of care through robotics, digital innovation, and advanced instrumentation. In July, the U.S. FDA granted De Novo authorization for OTTAVA, the world’s first table-integrated soft tissue robotic system. This is one of the most significant MedTech innovations we will bring to market this decade. OTTAVA’s unique architecture, automated features, and next-generation robotic instruments help address surgeons’ needs for operating-room space and better surgical workflows. Its connection to our open digital ecosystem, POLYPHONIC, turns procedure data into actionable insights for clinicians. We already signed our first commercial customer for OTTAVA, and we are progressing our development program. Our Investigational Device Exemption trial is already underway in inguinal hernia repair, with future plans for indication expansion into urology and gynecology. Finally, in Vision , we are advancing lifelong eye health to bring better sight to more than 40 million people each year. The recent U.S. launch of TECNIS PureSee further strengthened our portfolio of intraocular lenses. During the quarter, TECNIS PureSee and TECNIS Odyssey surpassed 1 million implants worldwide, reflecting continued surgeon adoption and our leadership in personalized vision solutions. We also received CE marking for ACUVUE OASYS MAX 2-Week reusable lenses, expanding our ACUVUE portfolio in Europe. Overall, this quarter’s strong results demonstrate the impact of the choices we have made to build a foundation for durable growth. We sharpened our portfolio to focus on innovation with the greatest potential to change lives. We proved our ability to grow through a significant loss of exclusivity. Our strategic investments in high-growth areas are delivering results, and our innovation engine continues to drive breakthroughs for patients. That is why we have the confidence to say that we will finish 2026 strong and that 2027 will be an even better year for Johnson & Johnson. Remarks by Joe Wolk, Executive Vice President and Chief Financial Officer As you heard from Joaquin and Ryan, our third-quarter results were driven by the strength of our Innovative Medicine business. This performance more than offset headwinds in certain areas of MedTech, enabling us to exceed expectations on both the top and bottom line, while continuing to invest in our pipeline and future growth. We are clear on where MedTech performance needs to improve, specifically Cardiovascular and Surgery outside the U.S., and are taking action to strengthen results. While disappointing, the underlying fundamentals of the MedTech business remain strong, supporting our confidence in the long-term for that business. Across Johnson & Johnson, the drivers underpinning our outlook remain firmly in place. As a result, we are raising our guidance for 2026 versus our most recent update in July. The depth of our portfolio, momentum from new product launches, and upcoming pipeline catalysts further reinforce our conviction in achieving double-digit growth by the end of this decade with sustainable growth beyond. Cash and Capital Allocation Turning to financial metrics and our cash position… we ended the third quarter with approximately $17 billion of cash and marketable securities and approximately $45 billion of debt for a net debt position of approximately $28 billion, generating more than $6 billion in free cash flow in the third quarter. We remain confident in our full-year free cash flow guidance of approximately $21 billion. During the quarter, we completed the $1 billion acquisition of Firefly Bio, deepening capabilities in Oncology with next-generation antibody engineering to address complex tumor biology. As Joaquin referenced earlier, we also entered into a collaboration with Sail Biomedicines to advance in vivo CAR-T therapies for immune-mediated diseases. Our disciplined approach to capital allocation is principled on prioritizing investments that support key commercial launches, accelerating future innovation, increasing our annual dividend, and strengthening our pipeline through strategic, value-creating inorganic opportunities. In July, we announced an agreement for a resolution of the ovarian talc litigation for $5.5 billion which is reflected in our third quarter GAAP results. The agreement is conditioned upon the express participation of at least 95% of the remaining ovarian claims. We are trending to meet the 95% threshold. Full-Year 2026 Guidance Let me now turn to full-year 2026 guidance. As always, our outlook reflects what we know today regarding foreign exchange rates, the broader macroeconomic environment, and other external factors. Based on our year-to-date performance and expectations for the fourth quarter, we are raising the midpoint and tightening the range of our operational sales guidance. We now expect full-year operational sales growth in the range of 6.7% to 7.1%, which represents operational sales of $100.7 billion at the midpoint, or growth of 6.9%. We do not speculate on future currency movements. As of last week, the Euro Spot Rate to the U.S. dollar was $1.12, however, the average rate for the fiscal year stands at $1.15. Based on that average rate, we estimate reported sales growth of 7.2% to 7.6%, with a midpoint of $101.2 billion or 7.4%. Assuming the current spot rate holds into next year, you could expect currency to be a headwind. Notable Items on the P&L Turning now to other items of the P&L, regarding operating margin, we now expect a decline of approximately 60 basis points. This is an improvement from the 75 basis point decline reflected in our updated July guidance that included the impact of the Firefly Bio and Sail Biomedicines transactions, which had an unfavorable impact of 150 basis points. Absent those deals, we continue to deliver base margin improvement. As a reminder, our pre-tax adjusted operating margin outlook also reflects the costs associated with the 53rd week of operations and our previously announced agreement with the U.S. government to improve access to medicines. For net interest expense, we are lowering our guidance to $150 million to $200 million. We are also tightening the range of our effective tax rate guidance. Based on our year-to-date results, we now expect a full-year effective tax rate of 17.0% to 17.5%. Given those updates, we now expect adjusted operational earnings per share in the range of $10.95 to $11.05 or 2.0% at the midpoint. We expect reported adjusted earnings per share of $11.05 to $11.15, with a midpoint of $11.10, or growth of 2.9%. Excluding the impact of the Firefly Bio and Sail Biomedicines transactions of $0.64, reported EPS growth would approach 9%. As a reminder for your 2027 modeling, we expect Firefly Bio and Sail Biomedicines to have a combined dilutive impact of $1.36 per share on full-year adjusted earnings per share next year. We will provide more details on our 2027 outlook later this year at our Enterprise Business Review. Commercial Outlook and Pipeline Progress Let me now highlight several upcoming developments that reinforce our growth outlook and performance for the remainder of the year. In Oncology , we expect several important data readouts in the fourth quarter. These include data for pasritamig, a first-in-class bispecific antibody in patients with advanced prostate cancer who have progressed after multiple lines of therapy. We also expect data for JNJ-6143, an investigational first-in-class once-daily oral therapy for metastatic castration-resistant prostate cancer. We continue to see strong adoption for INLEXZO, with year-to-date sales of approximately $200 million and expect to build on that momentum with a data readout in high-risk non-muscle invasive bladder cancer later this year. We also expect U.S. approval of RYBREVANT FASPRO in advanced head and neck cancer. In Immunology , as Joaquin referenced earlier, ICOTYDE is off to a strong start and we look forward to presenting data in psoriatic arthritis later this year. In MedTech , we expect U.S. approval of VARIPULSE Pro in the fourth quarter, further complementing last week’s approval in Japan. In Heart Recovery , we are taking corrective action to improve ABIOMED performance. We continue to invest in clinical evidence and expect results from the HRPCI Protect IV trial in 2027. The trial will have 1,252 patients, 4 times more than the CHIP-BCIS3 study. This large-scale study will evaluate the safety and efficacy of ABIOMED’s Impella CP pump during high-risk percutaneous coronary intervention. In Surgery , we are focused on commercializing OTTAVA following its recent FDA De Novo authorization. We expect adoption and revenue contribution to build over time, with the goal of establishing OTTAVA as a significant pillar of our Surgery portfolio by the end of the decade. Orthopaedics Separation Update Regarding Orthopaedics, we remain on track for the planned separation of DePuy Synthes by mid-2027. I am really proud of the team working to evaluate all separation vehicles and all options are better positioned today than when we announced our intentions with this business. Given the way DePuy Synthes is performing and the momentum Namal Nawana and his team are generating, we are leaning towards a spin as being the best option to create long-term value for Johnson & Johnson shareholders. That has always been our base plan and we are confident that it can be successfully executed. We will provide additional updates as appropriate and when there is more information to share. Enterprise Business Review Preview Finally, I am really looking forward to and hope you join us for the Enterprise Business Review on December 8th. At that event, we will provide additional perspective on our 2027 outlook and the key drivers that reinforce our conviction in achieving double-digit growth by the end of the decade. Perhaps more importantly, we will highlight our earlier stage pipeline and how it represents the next wave of growth into the next decade. Attendees will also have the opportunity to experience first-hand some of our latest innovations, such as OTTAVA. Conclusion 2026 is on track for another successful year, exceeding expectations set at the beginning of the year. We look forward to closing out 2026 strong and setting up 2027 for continued success. Thank you to our colleagues whose dedication and commitment continue to advance innovation, improve patient outcomes, and create long-term value for shareholders. Note to investors concerning forward-looking statements These remarks contain “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995 regarding, among other things: future operating and financial performance, product development, and market position and business strategy. The reader is cautioned not to rely on these forward-looking statements. These statements are based on current expectations of future events. If underlying assumptions prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from the expectations and projections of Johnson & Johnson. A further list and descriptions of these risks, uncertainties and other factors can be found in Johnson & Johnson’s most recent Annual Report on Form 10-K, including in the sections captioned “Cautionary Note Regarding Forward-Looking Statements” and “Item 1A. Risk Factors,” and in Johnson & Johnson’s subsequent Quarterly Reports on Form 10-Q and other filings with the Securities and Exchange Commission. Copies of these filings are available online at www.sec.gov, www.jnj.com, investor.jnj.com, or on request from Johnson & Johnson. Any forward-looking statement made in these remarks speaks only as of the date of this release. Johnson & Johnson does not undertake to update any forward-looking statement as a result of new information or future events or developments. Cautionary note on Non-GAAP financial measures These remarks refer to certain non-GAAP financial measures. These non-GAAP financial measures should not be considered replacements for, and should be read together with, the most comparable GAAP financial measures. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in the accompanying financial schedules of the earnings release and the Investor Relations section of the Company’s website. Johnson & Johnson does not provide GAAP financial measures on a forward-looking basis, as the company is unable to predict with reasonable certainty the ultimate outcome of adjusted items, such as legal proceedings, unusual gains and losses, acquisition-related expenses, and purchase accounting fair value adjustments without unreasonable effort. These items are uncertain, depend on various factors, and could be material to Johnson & Johnson’s results computed in accordance with GAAP. — Company newsroom — sourced from Johnson & Johnson. Matter furnished by the company. Not a Notice Nearby paid placement. This page reprints matter furnished by the company from its official newsroom. Notice Nearby did not write this release. Read the original: https://www.jnj.com/media-center/press-releases/johnson-johnson-q3-2026-earnings-ceo-and-cfo-prepared-remarks