Novartis reported modest second-quarter sales growth and reaffirmed its full-year 2026 guidance, as strong demand for key innovative medicines offset mounting generic competition and higher costs. Net sales rose to USD 14.4 billion, up 3% in reported terms and 1% at constant exchange rates, driven by double-digit constant-currency gains from oncology and immunology brands including Kisqali (+43%), Kesimpta (+32%), Scemblix (+89%), Pluvicto (+43%) and Leqvio (+59%).
Core operating income was stable at USD 5.9 billion, with a core margin of 41.2%, down 0.7 percentage points in constant currencies as lower gross profit and pricing pressure weighed on profitability. Reported operating income fell 3% at constant exchange rates to USD 4.8 billion, while net income dropped 19% to USD 3.3 billion, reflecting higher income taxes and interest expense. Free cash flow declined 12% to USD 5.6 billion on lower operating cash flows.
CEO Vas Narasimhan said the quarter marked a “solid” return to top-line growth, underpinned by priority brands and early traction from new launches Rhapsido in chronic spontaneous urticaria and Itvisma in spinal muscular atrophy. The company highlighted pipeline progress, including European and Japanese approvals for Rhapsido, EU approval of Itvisma as the only gene replacement therapy for a broad SMA population, updated overall survival data for Kisqali in early breast cancer, and an FDA accelerated approval filing for del-zota in Duchenne muscular dystrophy.
Novartis reiterated its 2026 outlook, guiding to low single-digit net sales growth and a low single-digit decline in core operating income at constant currencies.
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