Johnson & Johnson (JNJ) reported mixed results for the third quarter of 2026, with adjusted earnings beating estimates but sales falling short. The company's adjusted earnings came in at $2.59 per share, surpassing the Zacks Consensus Estimate of $2.53. However, sales totaled $25.4 billion, just missing the estimate of $25.44 billion. Despite a 5.9% year-over-year increase in sales, the results were impacted by costs related to recent business development transactions and a significant one-time special charge linked to proposed talc litigation resolution.
The company's Innovative Medicine segment saw a 7.7% year-over-year sales increase to $16.76 billion, driven by strong performance from key products like Darzalex, Tremfya, and Erleada. Newer drugs such as Carvykti, Tecvayli, and Rybrevant also contributed to growth. However, the oncology division's overall sales missed estimates due to declines in Imbruvica and Erleada sales. The immunology segment faced challenges from biosimilar competition for Stelara, but Tremfya's sales surged 68.3% to $2.40 billion.
J&J's MedTech business also underperformed, with sales increasing just 2.5% to $8.64 billion, missing the estimate of $8.77 billion. The segment faced declines in Abiomed sales and challenges in the Surgery and Vision segments. Despite these setbacks, J&J raised its 2026 sales guidance, projecting a range of $101.0-$101.4 billion, up from the previous $100.8-$101.4 billion. The company's adjusted earnings per share guidance was also raised to $11.05-$11.15.
Despite the positive outlook, J&J's shares declined around 2% in pre-market trading, reflecting investor disappointment with the quarterly results, particularly the weaker-than-expected MedTech performance. The company's shares have risen 27.8% year to date, outperforming the industry's 13.0% appreciation.