10-Q · April 28, 2026
Incyte reported Q1 2026 revenue of $1,273,000,000 and diluted EPS of $1.81, both beating consensus (revenue est. $1,218,892,208; EPS est. $1.31). Revenue is up ~21% versus Q1 2025 ($1.05B) but down versus the prior…
Earnings analysis · 10-Q
INCY earnings analysis
Filed July 28, 2026 · Our reading of the company's report
The latest report
Incyte delivered strong Q2 results, with revenue of $1.674 billion and diluted EPS of $2.81, supported by broad product growth and a $246.0 million one-time OPZELURA CMS settlement benefit. Excluding that benefit,…
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Incyte delivered strong Q2 results, with revenue of $1.674 billion and diluted EPS of $2.81, supported by broad product growth and a $246.0 million one-time OPZELURA CMS settlement benefit. Excluding that benefit, revenue growth remains healthy, led by JAKAFI demand and rapid expansion in ZYNYZ, NIKTIMVO and MONJUVI/MINJUVI. Cash generation was robust, but the subsequent $1.25 billion Vega acquisition, ongoing R&D investment, JAKAFI's 2028 exclusivity expiry and drug-pricing exposure temper the otherwise positive operating trajectory.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $2.81
What stood out
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Revenue accelerated, aided by CMS benefit
Q2 revenue rose 37.7% year over year to $1.674 billion from $1.216 billion and approximately 31.8% sequentially from $1.27 billion in Q1 2026. The reported total includes a $246.0 million one-time, non-cash OPZELURA benefit from the CMS settlement; excluding it, revenue was approximately $1.428 billion, up 17.5% year over year.
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Earnings rose sharply
GAAP diluted EPS increased 37.7% year over year to $2.81 from $2.04, while net income rose to $585.6 million from $405.0 million. EPS also increased 91.2% sequentially from $1.47 in Q1 2026.
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Margins recovered sequentially
Calculated gross margin expanded to 93.7% from 93.5% a year earlier and 91.8% in Q1 2026. Calculated operating margin was 41.7%, up from 23.7% sequentially but below 43.6% in Q2 2025, which benefited from a $242.2 million contract-dispute settlement gain.
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Underlying demand growth remained solid
Core franchise growth remained broad: JAKAFI/JAKAFI XR sales rose $52.9 million year over year to $816.7 million, with paid demand up 9%; excluding the CMS item, OPZELURA grew $39.2 million to about $203.7 million, driven by $48.2 million of volume growth partly offset by a $9.0 million price decline.
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Growth portfolio broadened
Newer hematology/oncology products grew rapidly year over year: ZYNYZ increased to $49.9 million from $8.9 million, NIKTIMVO to $60.3 million from $36.2 million, and MONJUVI/MINJUVI to $53.7 million from $31.1 million. Product royalty revenue also increased to $174.7 million from $151.1 million, led by JAKAVI royalties of $124.2 million.
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Cash generation and liquidity are strong
Six-month operating cash flow rose to $877.0 million from $310.8 million, while capital expenditures were only $22.6 million, implying approximately $854.4 million of six-month free cash flow and 2.6% capex intensity. Liquidity was $4.5 billion at June 30, with no revolver borrowings; subsequent $1.25 billion cash consideration for Vega reduces pro forma liquidity to roughly $3.25 billion before subsequent cash generation.
What to watch
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OPZELURA growth includes a $246.0M one-time item
Reported OPZELURA sales of $449.7 million include a $246.0 million one-time, non-cash reversal of prior CMS-related accruals. Excluding this item, quarterly OPZELURA sales were approximately $203.7 million, making the reported 173.4% year-over-year increase non-recurring in large part.
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Vega deal creates execution and capital risk
The company paid $1.25 billion in July 2026 to acquire Vega Therapeutics, following June 30 liquidity of $4.5 billion. Management identifies integration, development, commercial execution, potential write-offs and contingent liabilities as acquisition risks; latarcibart VIVID-6 topline data are not anticipated until early 2029.
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JAKAFI concentration and 2028 patent cliff
JAKAFI/JAKAFI XR remained the largest product at $816.7 million, or 48.8% of total $1.674 billion revenue, and management expects JAKAFI sales to begin declining after patent exclusivity expires in 2028. Generic litigation remains pending against certain manufacturers, despite settlements with several challengers.
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Drug-pricing policy may pressure net sales
The filing newly emphasizes government pricing-policy exposure, including a May 12, 2025 executive order directing HHS to establish most-favored-nation price targets. It also notes that the Medicaid rebate cap was eliminated effective January 2024 and that government rebates/chargebacks may rise with price increases above inflation.
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Late-stage pipeline sustains high R&D spending
R&D expense increased 4.5% year over year to $517.0 million as clinical research and outside services reached $292.2 million. Management expects significant continuing development investment, while future Q3 Vega-related IPR&D expense was not quantified in this 10-Q.
Management's outlook
The 10-Q does not provide numerical full-year revenue or EPS guidance. MD&A contains pipeline timing expectations, including potential U.S. tafasitamab and povorcitinib approvals in Q1 2027, and expects improved OPZELURA gross-to-net following the CMS resolution.
Earlier filings 4
10-K · February 10, 2025
Incyte’s 10-K highlights continued revenue scale driven by product sales (Q4 revenue $1,179,000,000; implied FY 2024 revenue $4,241,630,000 using quarterly results). The company shows very high product gross margins…
10-Q · October 29, 2024
Incyte reported Q3 revenues of $1,137,871,000, up $218,846,000 (23.8%) versus Q3 2023, driven by product and royalty growth. Operating income declined to $146,085,000 from $214,705,000 a year ago (operating margin…
10-Q · July 30, 2024
Incyte reported Q2 revenue of $1,043,759,000, up $89,149,000 (+9.3%) versus Q2 2023, but posted a large operating loss of $478,130,000 and net loss of $444,601,000 (diluted EPS $(2.04)). Cash and cash equivalents fell…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.