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Eli Lilly & Co

LLY
10-KFiled:February 12, 2026

Summary

Full summary

The Print

positive

Revenue rose 45% to $65.2B and net income rose 95% to $20.6B, with diluted EPS of $22.95, as Mounjaro and Zepbound together accounted for 56% of total revenues.

Revenue increased 45% to $65.2B, which management attributes to increased volume, partially offset by lower realized prices, with the increased volume and lower realized prices primarily driven by Mounjaro and Zepbound. Net income and earnings per share increased primarily due to higher gross margin, partially offset by increased marketing, selling, and administrative expenses and research and development expenses. Gross margin as a percent of revenue increased 1.7 percentage points, primarily driven by favorable product mix and improved cost of production, partially offset by lower realized prices.

  • Revenue increased 45% to $65.2B in 2025 from $45.0B in 2024, driven by volume (+50% consolidated) partially offset by price (-6%), with U.S. revenue up 43% and outside-U.S. revenue up 48%.
  • Net income rose 95% to $20.6B and diluted EPS rose 96% to $22.95; gross margin as a percent of revenue was 83.0%, up 1.7 percentage points, which management attributes to favorable product mix and improved cost of production, partially offset by lower realized prices.
  • Mounjaro revenue reached $23.0B (+99%) and Zepbound $13.5B (+175%); the two incretin medicines accounted for 56% of total revenues in 2025.
  • Operating cash flow rose to $16.8B from $8.8B, while capital expenditures increased to $7.8B from $5.1B and total debt rose to $42.5B from $33.6B.

Results That Matter

  • Revenue
    Current period
    $65.2B
    Prior period
    $45.0B
    Change
    +44.7%
    Revenue increased in 2025 driven primarily by increased volume, partially offset by lower realized prices, with the increased volume and lower realized prices primarily driven by Mounjaro and Zepbound.
  • Net income
    Current period
    $20.6B
    Prior period
    $10.6B
    Change
    +94.9%
    Net income increased in 2025 primarily due to higher gross margin, partially offset by increased marketing, selling, and administrative expenses and research and development expenses.
  • Earnings per share - diluted
    Current period
    $23.0
    Prior period
    $11.7
    Change
    +96.0%
    Diluted EPS increased 96.0% while net income increased 94.9%; diluted shares used in the calculation declined to 899.3 million from 904.1 million.
  • Gross margin as a percent of revenue
    Current period
    83.0%
    Prior period
    81.3%
    Change
    +1.7 ppts
    Gross margin as a percent of revenue in 2025 increased 1.7 percentage points compared with 2024, primarily driven by favorable product mix and improved cost of production, partially offset by lower realized prices.
  • Research and development
    Current period
    $13.3B
    Prior period
    $11.0B
    Change
    +21.3%
    Research and development expenses increased 21 percent in 2025, primarily driven by continued investments in our early and late-stage portfolio.
  • Marketing, selling, and administrative
    Current period
    $11.1B
    Prior period
    $8.6B
    Change
    +29.1%
    Marketing, selling, and administrative expenses increased 29 percent in 2025, primarily driven by promotional efforts supporting ongoing and planned launches.
  • Acquired in-process research and development
    Current period
    $2.9B
    Prior period
    $3.3B
    Change
    −11.3%
    Acquired IPR&D charges recognized in 2025 were primarily related to the acquisitions of Scorpion Therapeutics, Inc.'s PI3Kα inhibitor program STX-478 and of SiteOne Therapeutics, Inc.
  • Income taxes
    Current period
    $5.1B
    Prior period
    $2.1B
    Change
    +143.6%
    The effective tax rate was 19.8 percent in 2025 compared with 16.5 percent in 2024, primarily driven by unfavorable impacts related to the jurisdictional mix of earnings and U.S. tax law changes in 2025 relative to 2024.

Earnings Quality & Cash Conversion

Reported net income of $20,640M includes acquired IPR&D charges of $2,910M, asset impairment, restructuring, and other special charges of $484M, and other—net, (income) expense of $571M. Acquired IPR&D charges in 2025 were primarily related to the acquisitions of Scorpion's PI3Kα inhibitor program STX-478 and of SiteOne. Asset impairment, restructuring, and other special charges recognized during 2025 were primarily related to a litigation charge and acquisition and integration costs associated with the acquisition of Verve. The filing does not report an adjusted or ex-item earnings total.

Red flag

Receivables increased $7,000M in 2025 versus a $2,155M increase in 2024, outpacing the 44.7% revenue increase.

Red flag

Inventories increased $4,671M in 2025 versus a $2,507M increase in 2024, with LIFO-valued inventories rising to $5.8B from $2.7B.

Red flag

Cash payments of income taxes rose to $10,814M in 2025 from $6,562M in 2024, including $6.6B paid to Ireland.

Value Drivers & Capital Allocation

“In 2025, we repurchased $4.1 billion of shares under our $15.0 billion share repurchase program that our board authorized in December 2024. As of December 31, 2025, we had $10.9 billion remaining under this program.”

— Filing statement

“Dividends of $6.00 per share and $5.20 per share were paid in 2025 and 2024, respectively. The quarterly dividend was increased to $1.73 per share effective for the dividend to be paid in the first quarter of 2026, resulting in an indicated annual rate for 2026 of $6.92 per share.”

— Filing statement

“Capital expenditures were $7.8 billion during 2025, compared to $5.1 billion in 2024. We are making investments in global facilities to manufacture existing and future products.”

— Filing statement

“In July 2025, we acquired all shares of Verve Therapeutics, Inc. (Verve) for a purchase price of $10.50 per share in cash (or an aggregate of $549 million, net of cash acquired), plus one non-tradeable contingent value right (CVR) per share that entitles the holder to receive up to an additional $3.00 per share (or an aggregate of up to approximately $300 million) payable, subject to certain terms and conditions, upon the achievement of a certain specified milestone.”

— Filing statement

Return on equity was 77.8% (prior 74.2%) (period net income / period-end equity, not annualized); return on assets 18.4% (prior 13.5%) (period net income / period-end assets, not annualized).

Forward Signals

No quantitative financial guidance is provided in the filing. Management states that it expects near-term financial performance will be impacted by, among other factors, the timing of potential regulatory approvals for orforglipron and U.S. Medicare access for Zepbound (and, if approved, orforglipron), as well as the demand and pace of uptake in new incretin channels and markets.

Known trends

  • Mounjaro and Zepbound accounted for 56 percent of our total revenues in 2025 and we expect cardiometabolic health products will continue to represent a significant and growing portion of our business, revenues, and prospects.
  • In January 2026, HHS selected Trulicity and Verzenio as additional medicines subject to government-set prices to be effective in 2028.
  • As we expand our manufacturing capacity in order to meet existing and expected demand of our medicines, we have entered, and expect to continue to enter, into various agreements for contract manufacturing and for supply of materials.
  • As part of our business development activities in 2026, we have entered into acquisition agreements, subject to closing conditions. Potential amounts payable at closing for these pending acquisitions would be less than $3 billion.

Subsequent events

  • The quarterly dividend was increased to $1.73 per share effective for the dividend to be paid in the first quarter of 2026, resulting in an indicated annual rate for 2026 of $6.92 per share.
  • In January 2026, HHS selected Trulicity and Verzenio as additional medicines subject to government-set prices to be effective in 2028.

“We expect our near-term financial performance will be impacted by, among other factors, the timing of potential regulatory approvals for orforglipron and U.S. Medicare access for Zepbound (and, if approved, orforglipron), as well as the demand and pace of uptake in new incretin channels and markets.”

— Eli Lilly and Company (Item 7, MD&A - Executive Overview)

“These investments, and other capital investments that support our operations, have increased our capital expenditures and will result in meaningfully higher capital expenditures in the near term.”

— Eli Lilly and Company (Item 7, MD&A - Financial Condition and Liquidity)

Risks

4 source-verified filing excerpts. 1 item withheld because the evidence could not be matched. Selected excerpts are not a complete risk inventory.

Filing excerpt 1

EvidenceWe derived direct product and/or collaboration and other revenues of more than $3 billion for each of Mounjaro, Zepbound, Verzenio, Trulicity, Taltz, and Jardiance (including Glyxambi, Synjardy, and Trijardy XR) that collectively accounted for 82 percent of our total revenues in 2025.

Filing excerpt 2

EvidenceFor example, in July 2025, CVS Caremark, the pharmacy benefit management division of CVS Health, stopped covering Zepbound as a preferred obesity management medicine on some insurance plans, which has negatively impacted access for patients covered under these plans.

Filing excerpt 3

EvidenceFor example, Trulicity will lose significant patent and remaining data protections in the next few years.

Filing excerpt 4

EvidenceWe continue to see the production, marketing, and sale of counterfeit, misbranded, adulterated, and mass-compounded incretins.

Balance Sheet & Liquidity

Leverage: Identified debt as of 2025-12-31: reported debt balance of unestablished maturity scope of $40.9B. The concept behind this balance does not establish which maturities it covers. Total debt, net debt and debt-to-equity are therefore not stated.

Liquidity: Cash and cash equivalents of $7.3B plus $10.1B of unused committed bank credit facilities, $10.0B of which is available to support the commercial paper program.

Cash flow: Cash flow — operating $16.8B, investing $-11.0B, financing $-2.2B.

Working capital: Current assets $55.6B vs. current liabilities $35.2B (current ratio 1.58x). Prior reported balance sheet as of 2024-12-31: $32.7B vs. $28.4B (1.15x).

Maturities & covenants

  • At December 31, 2025, we had $10.1 billion of unused committed bank credit facilities, which consisted primarily of a $4.0 billion credit facility that expires in December 2029 and a $6.0 billion 364-day facility that expires in August 2026, both of which are available to support our commercial paper program.
  • As of December 31, 2025, we have long-term income taxes payables of $1.1 billion that we expect to pay in 2027 and $4.8 billion that we cannot reasonably estimate the timing of future cash outflows.

Notable Footnotes

ItemImpact
Sales rebate, discount, and return liability sensitivityA 5 percent change in the consolidated sales return, rebate, and discount liability would result in a change in revenue of approximately $897 million.
Uncertain tax positions and valuation allowance sensitivityA 5 percent change in uncertain tax positions and the valuation allowance would change net income by $160 million and $61 million, respectively.
Unrecognized tax benefitsGross unrecognized tax benefits rose to $5,082M at December 31, 2025 from $3,976M at December 31, 2024; $3.2B would affect the effective tax rate if recognized.
Purchase obligations for contract manufacturing and materialsExecuted agreements related to medicines in development could require payments of up to approximately $10 billion if specified amounts of goods or services are not purchased over durations generally up to 8 years.

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AI-generated. Informational only, not investment advice. May be incomplete or contain errors. The authoritative source is always the original SEC filing.