Johnson & Johnson beat analyst expectations for the second quarter of 2015 with earnings per share of $1.71, the company announced Tuesday. That's despite reporting a 9% decrease in sales compared with the second quarter of 2014.
The pharmaceutical and medical-device giant still managed to beat Wall Street's forecast even after experiencing a revenue dip in the second quarter to $17.8 billion compared with $19.5 billion in sales reported for the second quarter last year. Estimates had the company delivering earnings of $1.68 per share and $17.7 billion in revenue, according to Zack's Investment Research.
The company saw its net income rise by 4.6% in the second quarter of 2015 compared with the second quarter of 2014 to $4.5 billion, improving its earnings guidance for the full year of 2015 to $6.10-$6.20 per share. The company stated the negative impact of foreign currency was responsible for a 14.8% drop in sales, which would have increased by 1.7% during the quarter without that impact.
The mostly positive results were driven largely by strong sales in worldwide consumer products and pharmaceuticals. The company reported worldwide consumer product sales of $3.5 billion of over-the-counter items like the allergy medication Zyrtec and the pain reliever Tylenol. Foreign currency had a 9% negative impact on sales, but excluding that factor, sales reportedly increased by 3.1% for the quarter.
“Our solid sales and earnings results in the quarter reflect the strong underlying growth we're seeing across the enterprise,” Alex Gorsky, chairman and CEO of Johnson & Johnson, said in a statement. “Our diverse portfolio and scale are enabling this performance, and we've continued to invest in building a robust enterprise pipeline that will drive our growth over the long term. Our passion to deliver transformational new medicines and products reflects the ongoing commitment of our dedicated employees to improve health and well-being.”
Worldwide Medical Devices sales of $6.4 billion for the second quarter represented a decrease of 12.2% versus the prior year consisting of an operational decrease of 4.7% and a negative currency impact of 7.5%. Domestic sales decreased 5.8%; international sales decreased 17.3%, which reflected an operational decrease of 3.9% and a negative currency impact of 13.4%. Excluding the net impact of acquisitions and divestitures, on an operational basis, worldwide sales increased 1.4%, domestic sales increased 1.6% and international sales increased 1.4%.*
Pharmaceutical sales saw a 6.6% decline compared with last year at $7.9 billion. Much like consumer products however, a large contributor to the decline had to do with the negative impact of foreign currency, which caused sales to fall by 7.6%. Worldwide otherwise increased by 1.5% during the quarter without the impact of such factors.
In May, Johnson & Johnson announced plans to seek approval for more than 10 new products within its pharmaceutical business by 2019. Each new drug is expected to have the potential to reach $1 billion in annual sales as they will focus on such in-demand areas as immunology, infectious diseases and vaccines, neuroscience, cardiovascular and metabolism, and oncology.