Lilly(LLY) - 2025 Q1 - Quarterly Report

Financial Performance - Revenue for the three months ended March 31, 2025, was $12,728.5 million, a 45$8,768.0 million in the same period of 2024[114] - Net income for the same period was $2,759.3 million, up 23$2,242.9 million year-over-year[114] - Earnings per share (diluted) increased to $3.06, a 23$2.48 in the prior year[114] - U.S. revenue increased by 49% to $8,489.4 million, while revenue outside the U.S. rose by 38$4,239.1 million[131] - Mounjaro revenue reached $3,841.8 million, a 113$1,806.5 million in the previous year[134] - Zepbound revenue in the U.S. was $2.31 billion, compared to$517.4 million in the same quarter of 2024, driven by increased demand[135] - Revenue of Verzenio increased 3 percent in the U.S. and 22 percent outside the U.S. during the three months ended March 31, 2025[136] - Gross margin for the three months ended March 31, 2025 was $10,504.3 million, a 48 percent increase from$7,094.5 million in 2024, with a gross margin percentage of 82.5%[137] Expenses and Investments - Research and development expenses rose 8 percent to $2,733.7 million, reflecting continued investments in the portfolio[138] - Marketing, selling, and administrative expenses increased 26 percent to$2,468.8 million, driven by promotional efforts for ongoing and future launches[139] Debt and Cash Management - Total debt increased to $38.52 billion as of March 31, 2025, up$4.87 billion from $33.64 billion as of December 31, 2024[148] - Cash and cash equivalents decreased to$3.09 billion as of March 31, 2025, compared to $3.27 billion as of December 31, 2024[145] - The company repurchased$1.20 billion of shares during the three months ended March 31, 2025, with $13.80 billion remaining under the share repurchase program[150] - The company has$8.42 billion of unused committed bank credit facilities, with $8.00 billion available to support the commercial paper program[149] Regulatory and Market Challenges - The company withdrew its U.S. application for tirzepatide for heart failure with preserved ejection fraction in 2025[116] - The European Medicines Agency did not recommend donanemab for approval for early symptomatic Alzheimer's disease, and the company is seeking re-examination[116] - Jardiance was selected for government-set prices effective in 2026, which may influence future business strategies[118] - The company continues to face challenges from regulatory scrutiny and potential tariffs that could impact operations and costs[120] Taxation - The effective tax rate increased to 20.2 percent for the three months ended March 31, 2025, compared to 11.6 percent in 2024[140] Future Commitments - The company expects to incur up to approximately$8 billion in payments related to executed agreements for contract manufacturing and supply of materials over the next several years[144]