Pfizer’s (PFE) first quarter of 2025 showcased a disciplined and strategic approach to navigating a shifting pharmaceutical landscape, marked by declining COVID-19 revenues and policy pressures from U.S. Medicare Part D reforms. Total revenues for the quarter reached $13.7 billion, down 8% year-over-year (YoY), reflecting a 6% operational drop and a 2% negative impact from foreign exchange. Despite this topline decline, Pfizer delivered solid bottom-line results through cost optimization and selective growth across key product lines.

Reported net income came in at $3.0 billion, a 5% decrease YoY, with reported diluted EPS also down 5% at $0.52. However, on an adjusted basis, Pfizer demonstrated strength: adjusted income rose 12% YoY to $5.2 billion, and adjusted diluted EPS climbed 12% to $0.92—highlighting the underlying profitability improvements driven by operational efficiencies and favorable tax outcomes.

Cost discipline was a standout theme. Cost of sales fell 16% YoY to $2.8 billion, while SI&A expenses dropped 13% to $3.0 billion, and R&D expenses declined 12% to $2.2 billion, all reflecting improved productivity, pipeline optimization, and streamlined COVID-19-related spending. The effective tax rate was -6.8%, primarily due to favorable global tax resolutions, while the adjusted tax rate dropped to 7.8% from 16.6% a year ago.

In terms of segment performance, Global Biopharmaceuticals revenue totaled $13.4 billion, down 8% YoY, consistent with broader revenue trends. Pfizer CentreOne and Pfizer Ignite remained stable, with $257 million and $17 million in revenue, respectively.

Notable growth drivers included the Vyndaqel family, which surged 33% operationally, fueled by increased diagnosis rates and patient demand, despite IRA-related pricing pressure. Comirnaty saw a 62% operational increase, thanks to improved U.S. market dynamics and higher international shipments. Other high performers included Padcev (+25%), Nurtec ODT/Vydura (+40%), and Lorbrena (+39%), each showing strong uptake in key therapeutic areas.

Conversely, the wind-down of COVID-19-related demand led to a 75% drop in Paxlovid sales, a $1.5 billion decline. Eliquis and Xeljanz fell 4% and 31% operationally, respectively, primarily due to pricing and mix pressures under Medicare reforms, while Ibrance slipped 6%, impacted by generic competition and price erosion.

Despite a $273 million unfavorable swing in other income (driven by investment losses and the absence of prior-year asset sales), Pfizer maintained robust capital discipline. The company invested $2.2 billion in R&D and $90 million in business development, returned $2.4 billion to shareholders via dividends, and reaffirmed no share repurchases for the year—though $3.3 billion remains authorized. Management emphasized progress on deleveraging, with the company now below its stated leverage target.

Pfizer reaffirmed its full-year 2025 guidance, including revenues between $61.0 and $64.0 billion, adjusted EPS of $2.80 to $3.00, and continued operational savings initiatives. The company remains on track to achieve $4.5 billion in net cost savings by the end of 2025, with further productivity enhancements projected through 2027.

CEO Dr. Albert Bourla underscored Pfizer’s focus on execution, innovation, and adaptability, while CFO David Denton noted strong commercial delivery and operational efficiencies that position the company toward the upper end of its 2025 adjusted EPS range. With a robust pipeline, cost flexibility, and $10–15 billion in business development capacity, Pfizer enters the rest of 2025 with solid momentum and strategic optionality.