Novartis (NYSE:NVS) shares jumped on Tuesday after the Swiss drugmaker raised its full-year guidance on strong drug sales and announced a $15-billion share buyback.
The company made both announcements as it reported second-quarter earnings, which topped Wall Street’s expectations.
The share buybacks will go to the end of 2025, Novartis said. The company, which is sitting on a large cash pile after selling its stake in Swiss rival Roche in 2021, completed an earlier buyback program of roughly the same size last month.
Novartis expects sales to rise by a high-single-digit percentage in 2023, an increase from a previous expectation of mid-single-digit growth. The company also anticipates group core operating income will grow by a low double-digit percentage, up from a previous expectation of high-single-digit growth.
Earnings per share proved $1.83 vs. $1.68 expected, on revenue of $13.62 billion vs. $13.19 billion expected.
The company posted a net income of $2.32 billion, or $1.11 per share, for the quarter. That compares with $1.70 billion, or 77 cents per share, for the same period a year ago. Excluding certain items, Novartis’ adjusted earnings per share were $1.83 for the quarter.
Novartis reported total revenue of $13.62 billion for the quarter, up around 7% from $12.78 billion the same period a year ago.
The company’s innovative medicines business, which develops patented medicines, raked in sales of $11.24 billion for the quarter. That also rose 7% from a year ago.
NVS shares hiked $4.43, or 4.5%, mid-afternoon at $103.37. The stock has climbed more than 14% this year, putting the company’s market value at around $236 billion.