JNJ · Q2 2025 Earnings
BullishJohnson & Johnson
Reported July 16, 2025
30-second summary
J&J posted $23.7B in Q2 revenue (+5.8% YoY) and $2.77 adjusted EPS while absorbing $1.2B of Stelara biosimilar erosion — Innovative Medicine ex-Stelara grew 15.5% with 13 brands in double-digit growth. Management raised FY25 sales guidance midpoint to $93.4B and adjusted EPS to $10.85 (8.7% growth at midpoint), and the CFO went further on the call, saying he'd "be willing to bet" the company beats the upper end of the 2023 long-range targets. Oncology growing 22.3% operationally now anchors a hard $50B-by-2030 commitment, shifting that goal from aspiration to base case.
Headline numbers
EPS
Q2 FY2025
$2.77
Revenue
Q2 FY2025
$23.74B
+5.8% YoY
Gross margin
Q2 FY2025
67.9%
Operating margin
Q2 FY2025
27.3%
Key financials
Q2 FY2025| Metric | Q2 FY2025 | YoY |
|---|---|---|
| Revenue | $23.74B | +5.8% |
| EPS | $2.77 | — |
| Gross margin | 67.9% | — |
| Operating margin | 27.3% | — |
Guidance
Prior quarter data unavailable — comparison not possible.
Segment KPIs
Q2 FY2025| Segment | Q2 FY2025 | YoY |
|---|---|---|
| Innovative Medicine | $15.202B | +4.9% |
| MedTech | $8.541B | +7.3% |
| Innovative Medicine Oncology Revenue | $6.312B | — |
| MedTech Cardiovascular Revenue | $2.313B | — |
| MedTech Orthopaedics Revenue | $2.305B | — |
Other KPIs
Q2 FY2025| Segment | Q2 FY2025 | YoY |
|---|---|---|
| U.S. | $13.544B | +7.8% |
| Europe | $5.387B | +3.3% |
| Western Hemisphere excluding U.S. | $1.206B | -0.5% |
| Asia-Pacific, Africa | $3.606B | +4.4% |
| Darzalex Revenue | $3.539B | — |
| Stelara Revenue | $1.653B | — |
| Tremfya Revenue | $1.186B | — |
| Operating Margin | 27.3% | — |
| Adjusted Non-GAAP EPS | $2.77 | — |
Management tone
Five tone shifts define this print, and they all point the same direction.
Stelara is no longer framed as a vulnerability to manage but as evidence of structural advantage. CEO and CFO both leaned into the same line: "No other healthcare company has grown through the loss of exclusivity of a multi-billion dollar product in the first year. In our case, Stelara. And yet, that is exactly what we are doing, and for the second quarter in a row." Two quarters of growth through a $1.2B annualized headwind has converted the LOE story from defense to offense.
Oncology has been promoted from aspiration to commitment. Management stated flatly: "we expect to become the number one oncology company by 2030 with sales of more than $50 billion... you can see that we are well on our way to achieving that." The 22.3% operational growth in Q2 oncology is being used as load-bearing evidence that the $50B target is the base case, not a stretch.
Pipeline language hardened from hope to validation. The CFO offered an unusually personal signal: "the progress across our pipeline in the first half of the year heightens our conviction to achieve, and I'd be willing to bet likely beat, the upper end of the growth targets we conveyed at our 2023 Enterprise Business Review." That is not the typical J&J vocabulary — it suggests internal forecasts are now running meaningfully ahead of public commitments, with TAR200's internal forecast reportedly 3x street consensus for 2028.
Shockwave moved from "recent acquisition" to delivering platform. Management now describes it as "our 13th billion dollar medtech platform by the end of the year" — the integration narrative is closed.
MedTech margin posture shifted from defensive to confident. Despite tariffs and China VBP, the team reiterated the ~300bps full-year operating margin improvement without qualification.
Recurring themes management leaned on this quarter:
Risks management surfaced:
Q&A highlights
Chris Schott · J.P. Morgan
What are the drivers of upside to guidance, and how much is coming from innovative business versus med tech and specific franchises?
Both innovative and med tech businesses contributing. Pharma achieved first $15 billion quarter despite $1.2B Stellara erosion. Non-Stellara business grew 15.5% with 13 double-digit growth brands. Key drivers: Darzalex, Carvicti, Erleada, Ribrevansubq/Lasclues in oncology; Tramphia in immunology; Spravato and Caplida in neuroscience. MedTech operational growth 6.1%, up 4.4% sequentially, with cardiovascular up 22%, vision strong, surgery solid.
Terrence Flynn · Morgan Stanley
How does J&J support $50 billion oncology target by end of decade versus consensus, and what is status on ribrevansubq CRL response and target review date?
Confident in $50B oncology target based on strength across portfolio. Multiple myeloma with Darzalex continuing growth; Carvicti a $5B+ brand; TAR200 launching H2 with largest disconnect between internal forecasts and street expectations - 3x higher than 2028 consensus. Ribrevansubq/Lasclues launch progressing well, now #1 prescribed regimen for frontline EGFR lung cancer. Company responded to CRL with manufacturing-related questions (no new clinical studies required); approval expected H2. Also advancing in colorectal cancer and head/neck squamous cell carcinoma, TAR210 with 90%+ complete responses, and Romantamig tri-specific with 100% ORR.
Asad Haider · Goldman Sachs
What is J&J's perspective on pharma tariff announcement from President with low initial rate and one-year build period, and does company have sufficient US manufacturing capacity for US market?
Tax policies creating American jobs and driving innovation. J&J committed to $55 billion investment in US over next four years with goal to manufacture all US-consumed medicines in US by completion of plan. Company on track to achieve this goal. Difficult to know ultimate tariff outcomes but company focused on positioning for manufacturing self-sufficiency.
Shugun Singh · RBC Capital Markets
Can you clarify OTAVA submission timeline pushed to 2026, and what feedback are doctors providing on Varipulse adoption given EP headwinds?
OTAVA timeline not pushed - all milestones met including submission late last year, approval late last year, patient starts Q1, with de novo filing expected Q1 next year. EP growth 10% in Q2 of $5B base, representing 9% sequential growth versus Q1 with acceleration within quarter. Varipulse adoption strong with 10,000+ cases globally, neurovascular event rate below 0.5% (well below ADMIRE-IDE trial and published rates). Physician feedback phenomenal. FDA approved IFU update for optimized flow rate. Company confident in competitive positioning with zero-fluoro solution and deep sedation workflows. Pipeline includes dual-energy STSF catheter (EU approved), OmniPulse, and Soundstar Crystal ultrasound catheter. CARDO mapping software and 5,000-unit installed base provide differentiation.
Alex Hammond · Wolf Research
What is J&J's launch strategy for TAR200 including sales force training, supply chain, patient access, and physician education, and what are expectations for patient penetration?
600,000 new patients diagnosed annually plus 400,000 recurrent patients represent large opportunity. Entering first indication in BCG-experienced/failed patients, then expanding to broad non-muscle invasive space. Product leverages J&J's dual strengths: innovative medicine plus med tech expertise including engineers, catheter development, and J&J Institutes best-in-class training. Launch planning well underway with team excited for successful launch. Specific sales force, supply chain, and access details not disclosed.
What to watch into next quarter
TAR200 approval and launch trajectory — watch for FDA action in H2 2025 and any disclosure of early script or institutional uptake. Management's internal forecast is reportedly 3x 2028 street consensus, making this the single largest oncology variance to watch.
Stelara erosion shape — Q2 erosion was ~$1.2B YoY; the question is whether the year-two biosimilar curve mirrors Humira's accelerating pattern. Watch the Stelara dollar print in Q3 against the $1.65B Q2 base.
MedTech operating margin progress — management reiterated ~300bps full-year improvement; Q2 was already a sequential acceleration but H2 has to do the heavy lifting. Watch the operating margin print and any change in tariff or China VBP commentary.
Rybrevant/Lazcluze CRL resolution — H2 approval is the stated expectation; any further delay would dent the oncology narrative materially.
MFN policy inclusion in guidance — currently excluded; first commentary on quantified impact will move the 2026 setup.
Sources
- Johnson & Johnson Q2 2025 Earnings Press Release (Exhibit 99.2), filed July 16, 2025 — https://www.sec.gov/Archives/edgar/data/200406/000020040625000170/a2025q2exhibit992.htm
- Johnson & Johnson Q2 2025 Earnings Call transcript and prepared remarks (CEO and CFO commentary, Q&A session).
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