Viatris Gears Up to Report Q2 Earnings: What's in the Cards?

VTRS Q2 Earnings: Factors to Consider

The company reports under four segments based on geography — Developed Markets, Emerging Markets, Japan, Australia and New Zealand (“JANZ”) and Greater China.

Developed Markets sales are expected to rise, though growth in North America may be tempered by the Indore manufacturing facility import alert. Solid growth in EpiPen, Creon and Viatris’ thrombosis portfolio is likely to have enabled it to partially absorb the anticipated competition for Dymista. Incremental revenues from new products, such as iron sucrose, are likely to have boosted the quarterly top line.

Following an inspection of Viatris' oral finished dose manufacturing facility in Indore, India, in June 2024, the company received a warning letter and import alert from the FDA in December 2024. The import alert affected 11 actively distributed products, including lenalidomide and everolimus. The Zacks Consensus Estimate for revenues from Developed Markets is pinned at $2.18 billion.

Sales from Emerging Markets are expected to have experienced growth, driven by branded business in Turkey, Mexico and certain Asian markets. The generic business is likely to have seen growth due to the stabilization of supply for certain lower-margin ARB products. The Zacks Consensus Estimate for revenues from this geography is pegged at $558.5 million.

Viatris shares have surged 41.6% year to date against the industry’s 1.1% decline.

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Sales in JANZ are likely to have been adversely impacted by lower net sales of existing products in Japan and Australia due to government price reductions and additional competition. The Zacks Consensus Estimate for revenues from the JANZ markets is pinned at $285.1 million.

Sales in Greater China might have increased due to strong growth across multiple channels, including e-commerce, retail and private hospitals, as a result of higher marketing and selling efforts. The Zacks Consensus Estimate for revenues from this geography is pegged at $631.7 million.

Viatris also reports revenues under two divisions (in terms of product category) — brands and generics.

The brand business comprises the majority of the company’s portfolio. Brand performance is likely to have benefited from strong performance in Greater China and Emerging Markets, in addition to growth in certain key brands in Developed Markets.

However, the generics business is likely to have been negatively impacted by inspection at the Indore facility and competition for Wixela, partially offset by continued growth in Yupelri and Breyna in North America, strong performance across key European markets, and slight volume growth in JANZ.

On the profitability front, gross margin is likely to have been stable. Total operating expenses in the second quarter of 2026 are likely to have declined as a result of the planned cost-saving initiatives.

VTRS’ Impeccable Earnings Surprise History

Viatris’ earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 10.04%. In the last reported quarter, VTRS beat on earnings by 13.46%.

What Our Model Predicts for Viatris

Our proven model does not conclusively predict an earnings beat for VTRS this time around.  The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case here, as you will see below.

Earnings ESP:Viatris has an Earnings ESP of -0.81% as the Most Accurate Estimate of 61 cents per share is just shy of the Zacks Consensus Estimate of 62 cents. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Zacks Rank:VTRS currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks to Consider

Here are some stocks worth considering from the healthcare space, as our model shows that these have the right combination of elements to beat on earnings this reporting cycle.

ACADIA Pharmaceuticals ACAD has an Earnings ESP of +25.00% and a Zacks Rank #2 at present.

Shares of ACAD have lost 4.1% year to date. The company’s earnings beat estimates in three of the trailing four quarters and missed on the remaining occasion, delivering an average surprise of 20.83%. Acadia is scheduled to report second-quarter results on Aug. 4, after market close.

Arcutis Biotherapeutics ARQT has an Earnings ESP of +52.94% and a Zacks Rank #2 at present.

Shares of ARQT have lost 10.7% year to date. The company’s earnings beat estimates in three of the trailing four quarters but missed in the remaining quarter, delivering an average surprise of 42.78%. ARQT is scheduled to report second-quarter results on Aug. 5.

BridgeBio Pharma BBIO has an Earnings ESP of +13.69% and a Zacks Rank #3 at present.

Shares of BBIO have risen 4.5% year to date. BridgeBio Pharma’s earnings missed estimates in each of the trailing four quarters, delivering an average negative surprise of 18.94%.

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This article originally published on Zacks Investment Research (zacks.com).

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