AstraZeneca Q3 core profit beats on cancer drugs, unveils $1.5 billion savings plan; shares up about 3% to 4%

AZN reported third-quarter core (non-GAAP) earnings of $2.79 per share, up 19% at constant exchange rates, beating analyst forecasts of $2.59 (Reuters) to $2.62 (Investing.com). Reported (GAAP) EPS was $2.02. Total revenue rose 7% at both actual and constant rates to $16,209 million, against a Reuters consensus of $15.94 billion. AstraZeneca reconfirmed its 2026 guidance for a mid-to-high single-digit rise in total revenue and a low double-digit rise in core EPS at constant rates.

Cancer drugs carried the quarter. Oncology revenue rose 17% to $7.77 billion, about 48% of the total, with Enhertu up 35% to $969 million and Imfinzi up 26% to about $2 billion. Tagrisso brought in $2.09 billion against $2.01 billion expected. Diabetes drug Farxiga fell 25% to $1.61 billion, and US Farxiga sales dropped 71% to $127 million after generic versions launched in the second quarter.

Core operating profit was $5.86 billion against a $5.40 billion consensus, a 36% margin that was 2.5 percentage points above forecasts, helped by lower costs than expected. UBS noted that about $100 million of the beat came from a Zoryve royalty disposal absent from its model. Separately, AstraZeneca launched its "Reshaping for Sustainable Growth" programme, which aims for $1.5 billion of annualised pre-tax savings over three years, essentially complete by the end of 2029, at up to $2.0 billion of one-time costs. Reuters said the company gave few details on how it would get there or whether jobs would be cut.

Shares rose about 3% in morning trade in London per Reuters, with Yahoo Finance reporting a 4% gain to 13,516p as Jefferies and UBS assessed the beat. The quarter had weak spots: Truqap sales of $210 million missed the $254 million forecast on US destocking, the Etcamah SERENA-4 trial missed its main goal, and a volrustomig lung cancer trial was discontinued.

Watch whether the savings show up against operating expenses, which rose 7% to $27.56 billion in the first nine months and which the company expects to rise again in the fourth quarter, and how the Farxiga erosion tracks against oncology growth.