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Johnson & Johnson Sees 35% Q2 Profit Hit, But Lifts Full-Year Guidance

Published 07/16/2020, 06:41 AM
Updated 07/16/2020, 06:41 AM
© Reuters.  J&J Earnings, Revenue Beat in Q2

© Reuters. J&J Earnings, Revenue Beat in Q2

Investing.com - Johnson & Johnson (NYSE:JNJ) reported a sharp drop in profits in its second quarter, with the Covid-19 outbreak hitting its medical devices division hard. But losses were not as large as had been expected and the company also raised its full-year guidance a little.

J&J announced adjusted earnings per share of $1.67, down 35% from last year, on revenue of $18.34 billion, a drop of 10.8%. Still, these came in ahead of expectations of EPS of $1.47 on revenue of $17.5 billion.

“Our second-quarter results reflect the impact of Covid-19 and the enduring strength of our pharmaceutical business, where we saw continued growth even in this environment,” said Alex Gorsky, Chairman and Chief Executive Officer.

At 7 AM ET (1100 GMT), J&J shares were up 0.1% premarket, up 1% from the beginning of the year.

The COVID-19 pandemic has hurt sales and left any future outlook uncertain. The New Brunswick (NYSE:BC), New Jersey-based company benefited from its business diversity and financial strength. The world’s largest maker of both consumer and pharmaceutical healthcare products is among a handful of mega-cap companies that have been able to provide full-year guidance during this global health crisis.

J&J was also able to raise this guidance, with its full-year adjusted profit forecast rising to $7.75 to $7.95 per share, from its prior estimate of $7.50 to $7.90 per share.

“The post-pandemic environment has brought many challenges for J&J, especially in its medical devices business where surgeries are being delayed to clear space for the virus patients,” said Haris Anwar, an analyst at Investing.com.

“That said, J&J is still in a better position to get through this difficult time due to its diversified operations. Demand for its consumer brands such as the pain reliever Tylenol and its blockbuster cancer drugs remain strong, offsetting some negative impact. J&J’s defensive nature and its attractive dividend should keep the stock well-supported in this crisis.”

Stay up-to-date on all of the upcoming earnings reports by visiting Investing.com's earnings calendar

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