Stock Performance of Eli Lilly in 2023 Points to its Poorest Showing Since 2008 - Is this a Cause for Financial Concern?
In the second quarter of 2025, Eli Lilly posted impressive financial results, with adjusted earnings per share reaching $6.31, marking a 61% increase from the year-ago period. The pharmaceutical giant also reported a revenue surge of 38%, reaching $15.6 billion. However, the company's shares saw a dip following the earnings announcement, reflecting a more complex picture of successes and setbacks.
One of the standout performers in Eli Lilly's portfolio is tirzepatide, approved only three years ago. This medicine has quickly made its way to significant sales, generating over $8 billion in the second quarter of 2025. Sold under the brand names Mounjaro for diabetes and Zepbound for obesity, tirzepatide's success is a rare feat in the industry.
Eli Lilly's pipeline is particularly strong in its core areas of diabetes and obesity. In addition to tirzepatide, the company's portfolio includes other promising GLP-1 drugs such as Mounjaro and Zepbound, as well as the oral GLP-1 candidate orforglipron. The latter showed significant weight loss (around 11-12%) in Phase 3 trials for diabetes and obesity and is planned for FDA approval submission, positioning these drugs as promising future blockbuster drugs in these areas.
However, orforglipron's phase 3 data did not meet the market's expectations, leading to a sell-off of Eli Lilly's shares. The race for oral GLP-1 drugs is heating up, with the preference for oral formulations among patients and the cost-effectiveness for pharmaceutical companies driving the competition.
Eli Lilly's cancer medicine Verzenio also posted strong sales, with $1.3 billion in sales in the second quarter of 2025, up 12% year over year. Despite these successes, Eli Lilly has faced several missteps this year in terms of financial results and clinical and regulatory progress, contributing to its poor performance in 2025.
Despite these challenges, Eli Lilly remains a solid dividend stock and projections suggest that the company could become the world's leading pharmaceutical company by revenue by 2030. According to some projections, Mounjaro and Zepbound could combine for nearly $62 billion in sales by 2030.
In conclusion, while Eli Lilly's second-quarter earnings showed strong financial results, the company's shares have faced a dip due to a combination of clinical setbacks and poor bottom-line guidance for the rest of 2025. However, with its strong pipeline and focus on core areas of diabetes and obesity, Eli Lilly remains a key player in the pharmaceutical industry and a potential frontrunner for the future.
